UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                        _________________________________

                                    FORM 10-Q

(Mark One)

X        QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2003


TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934

              FOR THE TRANSITION PERIOD FROM _________ TO _________

                         Commission File Number: 0-21487

                              CARVER BANCORP, INC.
                              --------------------
             (Exact name of registrant as specified in its charter)


                DELAWARE                                         13-3904174
                --------                                         ----------
     (State or Other Jurisdiction of                          (I.R.S. Employer
     Incorporation or Organization)                          Identification No.)

75 WEST 125TH STREET, NEW YORK, NEW YORK                            10027
----------------------------------------                            -----
(Address of Principal Executive Offices)                         (Zip Code)

       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (212) 876-4747
                                                           --------------

         Indicate by check |X| whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

                             Yes X         No
                                ---           ---

         Indicate by check |X| whether the registrant is an accelerated filer
(as defined in rule 12b-2 of the Exchange Act).

                             Yes           No  X
                                ---           ---

         Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.

COMMON STOCK, PAR VALUE $.01                                2,284,390
----------------------------                                ---------
           Class                                 Outstanding at October 31, 2003

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>                                                                                                            <C>
PART I.  FINANCIAL INFORMATION

         Item 1.  Financial Statements

                           Consolidated Statements of Financial Condition as of
                           September 30, 2003 (unaudited) and March 31, 2003......................................1

                           Consolidated Statements of Income for the Six Months
                           Ended September 30, 2003 and 2002 (unaudited)..........................................2

                           Consolidated Statement of Changes in Stockholders' Equity and
                           Comprehensive Income for the Six Months Ended September 30, 2003 (unaudited)...........3

                           Consolidated Statements of Cash Flows for the Six Months
                           Ended September 30, 2003 and 2002 (unaudited)..........................................4

                           Notes to Consolidated Financial Statements (unaudited).................................5

         Item 2.  Management's Discussion and Analysis of Financial Condition
                  and Results of Operations.......................................................................7

         Item 3.  Quantitative and Qualitative Disclosures About Market Risk.....................................21

         Item 4.  Controls and Procedures........................................................................21

PART II.  OTHER INFORMATION

         Item 1.  Legal Proceedings..............................................................................21

         Item 2.  Changes in Securities and Use of Proceeds......................................................22

         Item 3.  Defaults Upon Senior Securities................................................................22

         Item 4.  Submission of Matters to a Vote of Security Holders............................................22

         Item 5.  Other Information..............................................................................23

         Item 6.  Exhibits and Reports on Form 8-K...............................................................23


SIGNATURES.......................................................................................................25

EXHIBITS.........................................................................................................26
</TABLE>

<PAGE>

PART I.  FINANCIAL INFORMATION
ITEM 1.  FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                           CARVER BANCORP, INC. AND SUBSIDIARIES
                                       CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                                             (IN THOUSANDS, EXCEPT SHARE DATA)

                                                                                             SEPTEMBER 30,      MARCH 31,
                                                                                                 2003             2003
                                                                                            ---------------   -------------
ASSETS                                                                                       (Unaudited)
<S>                                                                                         <C>               <C>
Cash and cash equivalents:
    Cash and due from banks                                                                       $ 11,856        $ 17,660
    Federal funds sold                                                                               9,000           5,500
                                                                                            ---------------   -------------
         Total cash and cash equivalents                                                            20,856          23,160
                                                                                            ---------------   -------------
Securities:
     Available-for-sale, at fair value (including pledged as collateral of
       $96,333 at September 30, 2003 and $124,139 at March 31, 2003)                               102,650         129,055
     Held-to-maturity, at amortized cost (including pledged as collateral of
       $50,543 at September 30, 2003 and $35,138 at March 31, 2003; fair value
       of $52,227 at September 30, 2003 and $37,543 at March 31, 2003)                              51,852          36,530
                                                                                            ---------------   -------------
          Total securities                                                                         154,502         165,585
                                                                                            ---------------   -------------
Loans receivable:
     Real estate mortgage loans                                                                    316,555         294,710
     Consumer and commercial business loans                                                          2,117           2,186
     Allowance for loan losses                                                                      (4,113)         (4,158)
                                                                                            ---------------   -------------
          Total loans receivable, net                                                              314,559         292,738
                                                                                            ---------------   -------------
Office properties and equipment, net                                                                10,469          10,193
Federal Home Loan Bank of New York ("FHLB-NY") stock, at cost                                        5,602           5,440
Accrued interest receivable                                                                          2,984           3,346
Identifiable intangible assets, net                                                                     71             178
Other assets                                                                                        12,885           9,205
                                                                                            ---------------   -------------
          Total assets                                                                           $ 521,928       $ 509,845
                                                                                            ===============   =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
     Deposits                                                                                    $ 361,220       $ 347,164
     Advances from the FHLB-NY and other borrowed money                                             97,644         108,996
     Other liabilities                                                                               7,956          12,612
                                                                                            ---------------   -------------
          Total liabilities                                                                        466,820         468,772
                                                                                            ---------------   -------------
Guaranteed preferred beneficial interest in junior subordinated debentures                          12,742               -
Stockholders' equity:
     Preferred stock (par value $0.01 per share; 1,000,000
        shares authorized; 100,000 issued and outstanding)                                               1               1
     Common stock (par value $0.01 per share: 5,000,000 shares authorized;
      2,316,358 shares issued; 2,283,558 and 2,296,960 shares outstanding at
      September 30, 2003 and March 31, 2003, respectively)                                              23              23
     Additional paid-in capital                                                                     23,811          23,781
     Retained earnings                                                                              18,898          16,712
     Unamortized awards of common stock under  management recognition plan ("MRP")                     (36)             (4)
     Treasury stock, at cost (32,800 shares at September 30, 2003 and 19,398
      shares at March 31, 2003)                                                                       (412)           (190)
     Accumulated other comprehensive income                                                             81             750
                                                                                            ---------------   -------------
          Total stockholders' equity                                                                42,366          41,073
                                                                                            ---------------   -------------
     Total liabilities and stockholders' equity                                                  $ 521,928       $ 509,845
                                                                                            ===============   =============
</TABLE>

See accompanying notes to consolidated financial statements.


                                       1
<PAGE>

<TABLE>
<CAPTION>
                                             CARVER BANCORP, INC. AND SUBSIDIARIES
                                               CONSOLIDATED STATEMENTS OF INCOME
                                             (IN THOUSANDS, EXCEPT PER SHARE DATA)
                                                          (UNAUDITED)

                                                                                 THREE MONTHS ENDED        SIX MONTHS ENDED
                                                                                    SEPTEMBER 30,           SEPTEMBER 30,
                                                                                  2003         2002        2003        2002
                                                                              ------------- ----------- ----------- -----------
<S>                                                                                <C>         <C>         <C>        <C>
Interest Income: (1)
   Loans                                                                           $ 5,061     $ 5,310     $ 9,927    $ 10,688
   Total securities                                                                  1,515       1,372       3,111       2,652
   Federal funds sold                                                                   26          77          81         188
                                                                              ------------- ----------- ----------- -----------
     Total interest income                                                           6,602       6,759      13,119      13,528
                                                                              ------------- ----------- ----------- -----------

Interest expense:
   Deposits                                                                          1,133       1,469       2,405       3,071
   Advances and other borrowed money                                                   953         741       1,911       1,478
                                                                              ------------- ----------- ----------- -----------
     Total interest expense                                                          2,086       2,210       4,316       4,549
                                                                              ------------- ----------- ----------- -----------
     Net interest income                                                             4,516       4,549       8,803       8,979
Provision for loan losses                                                                -           -           -           -
                                                                              ------------- ----------- ----------- -----------
     Net interest income after provision for loan losses                             4,516       4,549       8,803       8,979
                                                                              ------------- ----------- ----------- -----------

Non-interest income:
   Depository fees and charges                                                         490         457         974         861
   Loan fees and service charges                                                       492         257       1,137         804
   Gain on sale of securities                                                           31           -          31           -
   Other                                                                               561           2         572           4
                                                                              ------------- ----------- ----------- -----------
      Total non-interest income                                                      1,574         716       2,714       1,669
                                                                              ------------- ----------- ----------- -----------

Non-interest expense: (1)
   Compensation and benefits                                                         1,798       1,589       3,603       3,263
   Net occupancy expense                                                               343         320         667         656
   Equipment                                                                           399         354         781         772
   Capital securities cost                                                              23           -          23           -
   Other                                                                             1,350       1,270       2,620       2,636
                                                                              ------------- ----------- ----------- -----------
      Total non-interest expense                                                     3,913       3,533       7,694       7,327
                                                                              ------------- ----------- ----------- -----------

      Income before income taxes                                                     2,177       1,732       3,823       3,321
Income taxes                                                                           751         797       1,310       1,511
                                                                              ------------- ----------- ----------- -----------
      Net income                                                                   $ 1,426       $ 935     $ 2,513     $ 1,810
                                                                              ============= =========== =========== ===========

Dividends applicable to preferred stock                                               $ 49        $ 49        $ 98        $ 98
                                                                              ------------- ----------- ----------- -----------

      Net income available to common stockholders                                  $ 1,377       $ 886     $ 2,415     $ 1,712
                                                                              ============= =========== =========== ===========

Earnings per common share:
       Basic                                                                        $ 0.60      $ 0.39      $ 1.05      $ 0.75
                                                                              ============= =========== =========== ===========
       Diluted                                                                      $ 0.55      $ 0.37      $ 0.98      $ 0.72
                                                                              ============= =========== =========== ===========
</TABLE>

(1) Reclassifications have been made to prior year periods to conform with
current periods.

See accompanying notes to consolidated financial statements.


                                       2

<PAGE>

<TABLE>
<CAPTION>
                                             CARVER BANCORP, INC. AND SUBSIDIARIES
                                   CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
                                                   AND COMPREHENSIVE INCOME
                                                          (UNAUDITED)
                                                        (IN THOUSANDS)

                                                                                                   ACCUMULATED       COMMON
                                                           ADDITIONAL                                 OTHER          STOCK
                                 PREFERRED      COMMON      PAID-IN      RETAINED    TREASURY     COMPREHENSIVE     ACQUIRED
                                    STOCK        STOCK      CAPITAL      EARNINGS      STOCK          INCOME         BY MRP
                                 ------------- ---------- ------------- ----------- ------------ ----------------- -----------
<S>                                        <C>       <C>       <C>         <C>            <C>                <C>          <C>
Balance-March 31, 2003                     $1        $23       $23,781     $16,712        ($190)             $750         ($4)

Comprehensive income:
    Net Income for the period
    ended June 30, 2003                     -          -             -       1,087            -                 -           -
    Change in net unrealized
    gain on securities, net of
    taxes                                   -          -             -           -            -               (36)          -
Dividends paid                              -          -             -        (213)           -                 -           -
Allocation of shares for MRP                -          -            22           -            -                 -         (36)
Treasury stock activity                     -          -             -           -         (233)                -           -
                                 ------------- ---------- ------------- ----------- ------------ ----------------- -----------
Balance-June 30, 2003                      $1        $23       $23,803     $17,586        ($423)             $714        ($40)
                                 ------------- ---------- ------------- ----------- ------------ ----------------- -----------

Comprehensive income:
    Net Income for the period
    ended September 30, 2003                -          -             -       1,426            -                 -           -
    Change in net unrealized
    gain on securities, net of
    taxes                                   -          -             -           -            -              (633)          -
Dividends paid                              -          -             -        (114)           -                 -           -
Allocation of shares for MRP                -          -             -           -            -                 -           4
Treasury stock activity                     -          -             8           -           11                 -           -
                                 ------------- ---------- ------------- ----------- ------------ ----------------- -----------
Balance-September 30, 2003                 $1        $23       $23,811     $18,898        ($412)              $81        ($36)
                                 ============= ========== ============= =========== ============ ================= ===========
</TABLE>

                                    TOTAL
                                   STOCK-
                                  HOLDERS'
                                   EQUITY
                                 ----------
Balance-March 31, 2003             $41,073

Comprehensive income:
    Net Income for the period
    ended June 30, 2003             $1,087
    Change in net unrealized
    gain on securities, net of
    taxes                             ($36)
Dividends paid                       ($213)
Allocation of shares for MRP          ($14)
Treasury stock activity              ($233)
                                 ----------
Balance-June 30, 2003              $41,664
                                 ----------

Comprehensive income:
    Net Income for the period
    ended September 30, 2003         1,426
    Change in net unrealized
    gain on securities, net of
    taxes                             (633)
Dividends paid                        (114)
Allocation of shares for MRP             4
Treasury stock activity                 19
                                 ----------
Balance-September 30, 2003         $42,366
                                 ==========

See accompanying notes to consolidated financial statements.


                                       3
<PAGE>

<TABLE>
<CAPTION>
                                  CARVER BANCORP, INC. AND SUBSIDIARIES
                                  CONSOLIDATED STATEMENTS OF CASH FLOWS
                                               (UNAUDITED)
                                              (IN THOUSANDS)

                                                                              SIX MONTHS ENDED SEPTEMBER 30,
                                                                                  2003             2002
                                                                                  ----             ----
<S>                                                                             <C>              <C>
Cash flows from operating activities:
  Net income                                                                    $ 2,513          $ 1,810
  Adjustments to reconcile net income to net cash provided
     by operating activities:
     Provision for loan losses                                                        -                -
     ESOP and MRP expense                                                            18              149
     Depreciation and amortization expense                                          570              652
     Amortization of intangibles                                                    107              106
     Other amortization                                                           2,349              632
     Changes in assets and liabilities:
       Decrease (increase) in accrued interest receivable                           362             (155)
       Increase in other assets                                                  (4,238)              (2)
       Decrease in other liabilities                                             (4,706)          (2,707)
                                                                          --------------   --------------
          Net cash (used in) provided by operating activities                    (3,025)             485
                                                                          --------------   --------------
Cash flows from investing activities:
  Purchases of securities:
     Available-for-sale                                                         (36,925)         (36,848)
     Held-to-maturity                                                           (19,880)          (4,167)
  Proceeds from principal payments, maturities and calls of securities:
     Available-for-sale                                                          37,442           10,182
     Held-to-maturity                                                             4,452            2,307
  Proceeds from sale of available-for-sale securities                            23,871                -
  Disbursements for loan originations                                           (36,683)         (30,079)
  Loans purchased from third parties                                            (38,751)         (13,861)
  Principal collections on loans                                                 53,389           52,897
  Purchase of FHLB-NY stock                                                        (162)            (690)
  Proceeds from loans sold                                                            -            1,493
  Additions to premises and equipment                                              (846)            (455)
                                                                          --------------   --------------
          Net cash used in  by investing activities                             (14,093)         (19,221)
                                                                          --------------   --------------
Cash flows from financing activities:
  Net increase in deposits                                                       14,056            5,388
  Advances from FHLB-NY and other borrowed money                                 34,000           29,300
  Repayment of FHLB-NY advances and other borrowed money                        (45,352)         (15,603)
  Issuance of trust preferred securities                                         12,740                -
  Purchase of treasury stock                                                       (303)             (74)
  Dividends paid                                                                   (327)             (98)
                                                                          --------------   --------------
          Net cash provided by financing activities                              14,814           18,913
                                                                          --------------   --------------
Net (decrease) increase in cash and cash equivalents                             (2,304)             177
Cash and cash equivalents at beginning of the period                             23,160           34,851
                                                                          --------------   --------------
Cash and cash equivalents at end of  the period                                $ 20,856         $ 35,028
                                                                          ==============   ==============

Supplemental information:
Noncash Transfers-
  Change in unrealized gain on valuation of available-for-sale
       investments, net                                                           ($669)            $483
                                                                          ==============   ==============

Cash paid for-
  Interest                                                                        4,300            4,549
                                                                          ==============   ==============
  Income taxes                                                                    2,825            2,228
                                                                          ==============   ==============
</TABLE>

See accompanying notes to consolidated financial statements


                                       4
<PAGE>

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1) BASIS OF PRESENTATION

         The accompanying unaudited consolidated financial statements of Carver
Bancorp, Inc. (the "Holding Company"), have been prepared in accordance with
accounting principles generally accepted in the United States of America
("GAAP") for interim financial information and with the instructions to Form
10-Q and Article 10 of Regulation S-X promulgated by the Securities and Exchange
Commission ("SEC"). Accordingly, they do not include all of the information and
footnotes required by GAAP for complete consolidated financial statements. In
the opinion of management, all adjustments (consisting of normal recurring
adjustments) necessary for fair presentation have been included. The unaudited
consolidated financial statements presented herein should be read in conjunction
with the consolidated financial statements and notes thereto included in the
Holding Company's Annual Report on Form 10-K for the year ended March 31, 2003
("2003 10-K") previously filed with the SEC. The consolidated results of
operations and other data for the three-month period ended September 30, 2003
are not necessarily indicative of results that may be expected for the entire
fiscal year ending March 31, 2004 ("fiscal 2004"). The unaudited consolidated
financial statements include the accounts of the Holding Company and its wholly
owned subsidiaries, Carver Federal Savings Bank (the "Bank" or "Carver
Federal"), Carver Statutory Trust I, Alhambra Holding Corp., an inactive
Delaware corporation and the Bank's wholly owned subsidiaries, CFSB Realty
Corp., CFSB Credit Corp. and Carver Asset Corporation. The Holding Company and
its consolidated subsidiaries are referred to herein collectively as "Carver" or
the "Company." All significant inter-company accounts and transactions have been
eliminated in consolidation. We have no unconsolidated subsidiaries or
unconsolidated special purpose entities. Certain information and note
disclosures normally included in financial statements prepared in accordance
with GAAP have been condensed or omitted pursuant to the rules and regulations
of the SEC. Certain reclassifications have been made to prior period amounts to
conform to the current period presentation.

(2) NET INCOME PER COMMON SHARE

         Basic earnings per common share is computed by dividing income
available to common stockholders by the weighted-average number of common shares
outstanding. Diluted earnings per common share include any additional common
shares as if all potentially dilutive common shares were issued (for instance,
convertible preferred stock and stock options with an exercise price that is
less than the average market price of the common shares for the periods stated).
For the purpose of these calculations, unreleased ESOP shares are not considered
to be outstanding. For each of the three-month periods ended September 30, 2003
and 2002, preferred dividends of $49,000 were deducted from net income to arrive
at the amount of net income available to common stockholders. Additionally, for
both the three-month periods ended September 30, 2003 and 2002, 208,333 shares
of common stock potentially issuable from the conversion of preferred stock and
81,384 shares of common stock at September 30, 2003 potentially issuable from
the exercise of stock options with an exercise price that is less than the
average market price of the common shares for the three-months ended September
30, 2003 were considered in determining the diluted net income per common share.

(3) STOCK OPTION PLAN

ACCOUNTING FOR STOCK BASED COMPENSATION

         Since we have elected to apply the intrinsic value method, we are
required to disclose the pro-forma impact on net income and earnings per share
that the fair value-based method would have had if it were applied rather than
the intrinsic value method. Our policy with regards to stock-based compensation
has been to grant stock options and restricted stock awards after fiscal
year-end. Since stock options are typically awarded after fiscal year-end and
contain a nominal vesting period, no pro-forma compensation expense and its



                                        5
<PAGE>

related effect on net income and earnings per share has been reported herein.
Further disclosure is presented in Note 1 - "Summary of Significant Accounting
Policies -- Stock Based Compensation Plans" of our audited consolidated
financial statements in Carver's 2003 10-K.

(4) RECENT ACCOUNTING PRONOUNCEMENTS

ACCOUNTING FOR CERTAIN FINANCIAL INSTRUMENTS WITH CHARACTERISTICS OF BOTH
LIABILITIES AND EQUITY: RESCISSION OF SFAS NO. 150

         In November 2003, the FASB rescinded Statement of Financial Accounting
Standards ("SFAS") No. 150, "ACCOUNTING FOR CERTAIN FINANCIAL INSTRUMENTS WITH
CHARACTERISTICS OF BOTH LIABILITIES AND EQUITY." Issued in May 2003, SFAS 150
required issuers of certain financial instruments that fell within the scope of
SFAS No. 150, having characteristics of both liabilities and equity, to be
classified and measured as liabilities. SFAS No. 150 was effective for financial
instruments entered into or modified after May 31, 2003, and otherwise was
effective at the beginning of the first interim period beginning after June 15,
2003. The rescission of SFAS No. 150 did not have a material impact on our
financial condition or results of operations.

AMENDMENT OF STATEMENT 133 ON DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

         In April 2003, the FASB issued Statement of Financial Accounting
Standards ("SFAS") No. 149, "Amendment of Statement 133 on Derivative
Instruments and Hedging Activities," which amends and clarifies financial
accounting and reporting of derivative instruments, including certain derivative
instruments embedded in other contracts, and for hedging activities under SFAS
No. 133, "Accounting for Derivative Instruments and Hedging Activities." SFAS
No. 149 is generally effective for contracts entered into or modified after June
30, 2003, and for hedging relationships designated after June 30, 2003, and
should generally be applied prospectively. The provisions of SFAS No. 149 that
relate to SFAS No. 133 Implementation Issues that have been effective for fiscal
quarters that began prior to June 15, 2003, should continued to be applied in
accordance with their respective effective dates. In addition, the provisions of
SFAS No. 149 which relate to forward purchases or sales of when-issued
securities or other securities that do not yet exist, should be applied to both
existing contracts and new contracts entered into after June 30, 2003. The
adoption of SFAS No. 149 did not have a material impact on our financial
condition or results of operations.

GUARANTOR'S ACCOUNTING AND DISCLOSURE REQUIREMENTS FOR GUARANTEES, INCLUDING
INDIRECT GUARANTEES OF INDEBTNESS OF OTHERS

         In November 2002, the Financial Accounting Standards Board ("FASB")
issued Interpretation No. 45, "GUARANTOR'S ACCOUNTING AND DISCLOSURE
REQUIREMENTS FOR GUARANTEES, INCLUDING INDIRECT GUARANTEES OF INDEBTNESS OF
OTHERS" ("FIN 45"), which addresses the disclosure to be made by a guarantor in
its interim and annual financial statements about its obligations under
guarantees. FIN 45 also requires the recognition of a liability by a guarantor
at the inception of certain guarantees.

         FIN 45 requires the guarantor to recognize a liability for the
non-contingent component of the guarantee; this is the obligation to stand ready
to perform in the event that specified triggering events or conditions occur.
The initial measurement of this liability is the fair value of the guarantee at
inception. The recognition of the liability is required even if it is not
probable that payments will be required under the guarantee or if the guarantee
was issued with a premium payment or as part of a transaction with multiple
elements.

         The Company has adopted the disclosure requirements of FIN 45 and will
apply the recognition and measurement provisions for all guarantees entered into
or modified after March 31, 2003. As of September 30, 2003, the Company
maintained one letter of credit in the amount of $1.9 million. The adoption of
this interpretation had no significant effect on the Company's earnings or
financial position.

ACQUISITIONS OF CERTAIN FINANCIAL INSTITUTIONS

         In October 2002, the FASB issued Statement of Financial Accounting
Standards ("SFAS") No. 147, "ACQUISITIONS OF CERTAIN FINANCIAL INSTITUTIONS."
SFAS No. 147 amends SFAS No. 72, "Accounting for Certain Acquisitions of Banking
or Thrift Institutions," SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets", and FASB Interpretation No. 9, "Applying APB
Opinions Nos. 16 and 17 When a Savings and Loan Association or a Similar
Institution is Acquired in a Business Combination Accounted for by the Purchase
Method." SFAS No. 147 removes acquisitions of financial institutions, other than
transactions between two or more mutual enterprises, from the scope of SFAS No.
72 and FASB Interpretation No. 9. SFAS No. 147 also amends SFAS No. 144 to
include long-term customer-relationship intangible assets such as depositor- and
borrower-relationship intangible assets and credit card holder


                                       6
<PAGE>

intangible assets. The provisions of SFAS No. 147 became effective October 1,
2002. The adoption of this statement had no significant effect on the Company's
earnings or financial position.

ACCOUNTING FOR COSTS ASSOCIATED WITH EXIT OR DISPOSAL ACTIVITIES

         In June 2002, the FASB issued SFAS No. 146, "ACCOUNTING FOR COSTS
ASSOCIATED WITH EXIT OR DISPOSAL ACTIVITIES." The Statement requires companies
to recognize costs associated with exit or disposal activities when they are
incurred rather than at the date of a commitment to an exit or disposal plan.
Examples of costs covered by this standard include lease termination costs and
certain employee severance costs that are associated with a restructuring,
discontinued operation, plant closing or other exit or disposal activity.
Previous accounting guidance was provided by Emerging Issues Task Force ("EITF")
Issue No. 94-3, "Liability Recognition for Certain Employee Termination Benefits
and Other Costs to Exit an Activity (including Certain Costs Incurred in a
Restructuring)." SFAS No. 146 replaces EITF Issue No. 94-3. SFAS No. 146 is to
be applied prospectively to exit or disposal activities initiated after December
31, 2002. The adoption of this statement had no significant effect on the
Company's earnings or financial position.

RESCISSION OF FASB STATEMENTS NO. 4, 44, AND 64, AMENDMENT OF FASB STATEMENT NO.
13, AND TECHNICAL CORRECTIONS

         In April 2002, the FASB issued SFAS No. 145, "RESCISSION OF FASB
STATEMENTS NO. 4, 44, AND 64, AMENDMENT OF FASB STATEMENT NO. 13, AND TECHNICAL
CORRECTIONS." The Statement updates, clarifies and simplifies existing
accounting pronouncements. SFAS No. 145 rescinds SFAS No. 4, "Reporting Gains
and Losses from Extinguishment of Debt," which required all gains and losses
from extinguishment of debt to be aggregated and, if material, classified as an
extraordinary item, net of related income tax effect. As a result, the criteria
in Accounting Principles Board Opinion ("APB") No. 30, "Reporting the Effects of
Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently
Occurring Events and Transactions," will now be used to classify those gains and
losses. SFAS No. 64, "Extinguishments of Debt Made to Satisfy Sinking-Fund
Requirements," amended SFAS No. 4 and is no longer necessary because SFAS No. 4
has been rescinded. SFAS No. 145 amends SFAS No. 13, "Accounting for Leases," to
require that certain lease modifications that have economic effects similar to
sale-leaseback transactions be accounted for in the same manner as
sale-leaseback transactions. This amendment is consistent with the FASB's goal
of requiring similar accounting treatment for transactions that have similar
economic effects. SFAS No. 145 also makes technical corrections to existing
pronouncements. While those corrections are not substantive in nature, in some
instances they may change accounting practice. The provisions of SFAS No. 145
are effective for fiscal years beginning after May 15, 2002. The adoption of
this statement had no significant effect on the Company's earnings or financial
position.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

EXPLANATORY NOTE

         This Quarterly Report on Form 10-Q contains forward-looking statements
as that term is defined in the Private Securities Litigation Reform Act of 1995.
In addition, senior management may make forward-looking statements verbally to
analysts, investors, the media and others. Such forward-looking statements may
be identified by the use of such words as "believe," "expect," "anticipate,"
"intend," "should," "could," "plan," "estimate," "potential" and similar terms
and phrases, or future or conditional verbs such as "will," "would," "should,"
"could," or "may." Such forward-looking statements are subject to risks and
uncertainties, many of which are beyond our control, which could cause actual
results to differ materially from those currently anticipated due to a number of
factors. Factors which could result in material variations include, but are not
limited to, the Company's success in implementing its initiatives, including
expanding its product line, successfully opening new ATM centers and Bank
branches, successfully rebranding its image and achieving greater operating
efficiencies; changes in interest rates which could affect net


                                       7
<PAGE>

interest margins and net interest income; competitive factors which could affect
net interest income and non-interest income; general economic conditions which
could affect the volume of loan origination, deposit flows and real estate
values; changes in the quality and composition of the Bank's loan and investment
portfolios; changes in management's business strategy; the levels of
non-interest income and the amount of loan losses as well as other factors
discussed in documents filed by the Company with the SEC from time to time.

         Any forward-looking statements made in this report or incorporated by
reference in this report are made as of the date of this report, and, except as
required by applicable law, we assume no obligation to update the
forward-looking statements or to update the reasons why actual results could
differ from those projected in the forward-looking statements. You should
consider these risks and uncertainties in evaluating forward-looking statements
and you should not place undue reliance on these statements.

         As used in this Form 10-Q, "we," "us" and "our" refer to Carver
Bancorp, Inc. and its consolidated subsidiaries, unless the context otherwise
requires.

CRITICAL ACCOUNTING POLICIES

         Note 1 to our Consolidated Financial Statements for fiscal 2003
included in our 2003 Form 10-K, as supplemented by this report, contains a
summary of our significant accounting policies. We believe our policies with
respect to the methodology for our determination of the allowance for loan
losses and asset impairment judgments, including the recoverability of goodwill
and other than temporary declines in the value of our securities, involve a high
degree of complexity and require management to make difficult and subjective
judgments which often require assumptions or estimates about highly uncertain
matters. Changes in these judgments, assumptions or estimates could cause
reported results to differ materially. These critical policies and their
application are periodically reviewed with our Finance and Audit Committee and
our Board of Directors.

GENERAL

         The Holding Company, a Delaware corporation, is the holding company for
Carver Federal, a federally chartered savings bank, and, on a parent-only basis,
had minimal results of operations. The Holding Company is headquartered in New
York, New York. At this time, the Holding Company conducts business as a unitary
savings and loan holding company, and the principal business of the Holding
Company consists of the operation of its wholly-owned subsidiary, Carver
Federal, which operates five full-service banking locations in the New York City
boroughs of Brooklyn, Queens and Manhattan.

         The Company is dependent on dividends from the Bank, its own earnings,
capital raised and borrowings for sources of funds. The information below
reflects principally the financial condition and results of operations of the
Bank. The Bank's results of operations are primarily dependent on its net
interest income. The Bank also generates other income, such as fee income on
deposit and loan accounts and, to a lesser extent, debit card interchange
credit, and, depending on market conditions, net gains on sales of securities
and loans. The level of its expenses, such as salaries and benefits, occupancy
and equipment costs, other general and administrative expenses, net losses on
sales of securities and loans and income tax expense, further affects the Bank's
net income. This discussion and analysis should be read in conjunction with the
Consolidated Financial Statements, the notes thereto and other financial
information included in the Company's 2003 Form 10-K.

COMPARISON OF FINANCIAL CONDITION AT
SEPTEMBER 30, 2003 AND MARCH 31, 2003

ASSETS

         Total assets increased by $12.1 million, or 2.4%, to $521.9 million at
September 30, 2003 compared to $509.8 million at March 31, 2003. The change was
primarily attributable to increases of $21.8 million and $3.7 million in total
loans receivable, net, and other assets, respectively, partially offset by


                                       8
<PAGE>

decreases of $11.1 million and $2.3 million in total securities and total cash
and cash equivalents, respectively.

         Total loans receivable, net, increased $21.8 million, or 7.5%, to
$314.6 from $292.7 million at March 31, 2003. The increase resulted from
mortgage loan originations and purchases exceeding loan repayments during the
first six months of fiscal 2004. During the six-month period ended September 30,
2003, loan purchases and originations were $38.8 million and $36.7 million,
respectively, offset in part by loan repayments of $53.4 million. The $75.5
million in total loan originations and purchases for the period was primarily
comprised of $26.7 million in multifamily loans, $22.2 million in one- to
four-family loans, $21.0 million in non-residential real estate mortgage loans
and $5.1 million in construction loans. Management has evaluated yields and loan
quality in the competitive New York metropolitan area market and has made
decisions in certain instances to purchase mortgage-backed securities. It is
management's intent to continue to use proceeds from security repayments to fund
mortgage loan growth. Management will continue to evaluate the balance of
interest earning assets allocated to loan originations and purchases as well as
additional purchases of mortgage-backed securities while continuing to assess
yields and economic risk.

         Cash and cash equivalents for the six-month period decreased $2.3
million from March 31, 2003. The reduction was due to the Bank effectively
managing its lower yielding excess liquid assets by investing in mortgage loans
and mortgage-backed securities.

         Total securities decreased $11.1 million, or 6.7%, to $154.5 million
from $165.6 million at March 31, 2003 as repayments, maturities and sales
exceeded new security purchases. The decline is attributed to the low interest
rate environment, which in turn has accelerated mortgage refinancing and
prepayments of the Company's mortgage-backed securities. Principal repayments of
mortgage-backed securities of $24.9 million, maturities of investment securities
of $17.0 million and sales of $23.9 million were partially offset by new
purchases of $56.8 million.

         Other assets increased $3.7 million, or 40.0%, to $12.9 million from
$9.2 million at March 31, 2003. The increase is primarily due to a receivable
booked in the quarter ended September 30, 2003 for $9.0 million relating to the
sale of investment securities that was received in October 2003, partially
offset by a $3.5 million reduction in mortgage loans in process and a decline in
the Bank's deferred tax asset of $1.6 million.

LIABILITIES AND STOCKHOLDERS' EQUITY

         LIABILITIES

         At September 30, 2003, total liabilities decreased by $2.0 million, or
0.4%, to $466.8 million compared to $468.8 million at March 31, 2003. The
decrease in liabilities primarily reflects a decrease of $11.4 million in
advances from the Federal Home Loan Bank of New York ("FHLB-NY") and other
borrowed money and a decrease of $4.7 million in other liabilities partially
offset by deposit growth of $14.1 million.

         The decrease of $11.4 million in advances from the FHLB-NY and other
borrowed money resulted from a repayment of maturing FHLB-NY borrowings using
cash flow from the repayment of mortgage loans and mortgage-backed securities.
The decrease in other liabilities was primarily the result of a decline in the
liability for income taxes of $3.1 million as tax payments were remitted.

         The $14.1 million increase in deposit balances is primarily
attributable to new relationships with corporate and not-for-profit entities
which contributed to increases of $9.9 million in NOW accounts, $5.2 million in
money market accounts and $1.4 million in savings and club accounts. The
increases in core deposits were partially offset by a decrease of $2.4 million
in certificates of deposit accounts. Other factors contributing to deposit
growth include an emphasis on developing depository relationships with borrowers
and the use of special promotions to attract deposits. At September 30, 2003,
the Bank had five branches and one stand-alone 24/7 ATM center. We believe that
deposits will continue to grow with the addition of new branches and 24/7 ATM
centers coupled with our business development efforts.


                                       9
<PAGE>

         On September 17, 2003, the Holding Company, through a subsidiary
business trust, Carver Statutory Trust I, issued 13,000 shares, liquidation
amount $1,000 per share, of floating rate capital securities. Gross proceeds
from the sale of these trust preferred securities were $13.0 million, and,
together with the proceeds from the sale of the trust's common securities, were
used to purchase approximately $13.4 million aggregate principal amount of the
Holding Company's floating rate junior subordinated debt securities due 2033.
The trust preferred securities are redeemable quarterly at the option of the
Company beginning on or after July 7, 2007 and have a mandatory redemption date
of September 17, 2033. Cash distributions on the trust preferred securities are
cumulative and payable at a floating rate per annum (reset quarterly) equal to
3.05% over 3-month LIBOR, with an initial rate of 4.19%. The Holding Company has
guaranteed the obligations of Carver Statutory Trust I to the trust's capital
security holders. The $12.7 million net proceeds of the issuance of trust
preferred securities were contributed to the Bank to enhance regulatory capital,
which will facilitate the Company's growth strategy.

         STOCKHOLDERS' EQUITY

         Total stockholders' equity increased $1.3 million, or 3.1%, to $42.4
million at September 30, 2003 compared to $41.1 million at March 31, 2003. The
increase in total stockholders' equity was primarily attributable to an increase
in retained earnings year-to-date of $2.2 million, partially offset by a
decrease of $669,000 in accumulated other comprehensive income and a $222,000
decrease related to treasury stock. The $222,000 decrease related to treasury
stock is attributable to repurchases of the Company's stock, partially offset by
payments made from treasury stock for stock-based compensation plans.
Accumulated other comprehensive income decreased as a result of a reduction in
net unrealized gains, net of taxes, relating to certain investment and
mortgage-backed securities. Investment and mortgage-backed securities accounted
for as held-to-maturity are carried at cost while such securities designated as
available-for-sale are carried at market with an adjustment to stockholders'
equity, net of taxes.

         During the quarter ended September 30, 2003, the Holding Company did
not purchase any additional shares of its common stock. To date, the Holding
Company has purchased 29,100 shares of its common stock in open market
transactions at an average price of $13.84 per share as part of its repurchase
program announced on August 6, 2002. The Holding Company intends to use
repurchased shares to fund its stock-based benefit and compensation plans and
for any other purpose the Board of Directors of the Holding Company deems
advisable in compliance with applicable law.

ASSET/LIABILITY MANAGEMENT

         The Company's primary earnings source is net interest income, which is
affected by changes in the level of interest rates, the relationship between
rates, the impact of interest rate fluctuation on asset prepayments, the level
and composition of deposits and the credit quality of earning assets.
Management's asset/liability objectives are to maintain a strong, stable net
interest margin, to utilize its capital effectively without taking undue risks,
to maintain adequate liquidity and to manage its exposure to changes in interest
rates.

         The Company's Asset/Liability and Interest Rate Risk Committee
("ALCO"), comprised of members of the Board of Directors, meets periodically
with senior management to evaluate the impact of changes in market interest
rates on assets and liabilities, net interest margin, capital and liquidity.
Risk assessments are governed by policies and limits established by senior
management that are reviewed and approved by ALCO and the entire Board of
Directors.

         The economic environment continually presents uncertainties as to
future interest rate trends. ALCO regularly monitors the Company's cumulative
gap position, which is the difference between the sensitivity to rate changes on
our interest earning assets and interest bearing liabilities. In addition, the
Company utilizes a model that projects net interest income based on increasing
or decreasing interest rates, in order to respond effectively to changes in
interest rates.

LIQUIDITY AND CAPITAL RESOURCES

         Liquidity is a measure of the Bank's ability to generate adequate cash
to meet financial obligations. The principal cash requirements of a financial
institution are to cover downward fluctuations


                                       10
<PAGE>

in deposit accounts and increases in its loan and investment portfolio. The
Company's primary sources of funds are deposits, borrowed funds and principal
and interest payments on loans, mortgage-backed securities and investment
securities. While maturities and scheduled amortization of loans,
mortgage-backed securities and investment securities are predictable sources of
funds, deposit flows and loan and mortgage-backed securities prepayments are
strongly influenced by changes in general interest rates, economic conditions
and competition.

         Other sources of liquidity include the ability to borrow under
repurchase agreements, FHLB-NY advances utilizing unpledged mortgage-backed
securities and certain mortgage loans, the sale of available-for-sale securities
and the sale of loans. At September 30, 2003, the Bank had the ability to borrow
from the FHLB-NY an additional $39.0 million on a secured basis, utilizing
mortgage-related loans and securities as collateral.

         The Consolidated Statements of Cash Flows present the change in cash
from operating, investing and financing activities. During the six months ended
September 30, 2003, total cash and cash equivalents decreased by $2.3 million.
Net cash used in operating activities during this period was $3.0 million,
primarily representing decreases in other liabilities and increases in other
assets, adjusted for the balances of depreciation and amortization expense and
other amortization. Net cash used in investing activities was $14.1 million,
primarily representing the purchase of securities, loan purchases and
originations offset in part by principal payments and maturities of securities,
sale of available-for-sale securities and principal collections on loans. Net
cash provided by financing activities was $14.8 million, primarily representing
a net increase in deposits and proceeds from the issuance of trust preferred
securities, partially offset by a decrease in advances from the FHLB-NY.

         The Bank is required to maintain sufficient liquidity to ensure its
safe and sound operation. Management believes the Bank's short-term assets have
sufficient liquidity to cover loan demand, potential fluctuations in deposit
accounts and to meet other anticipated cash requirements. The Bank monitors its
liquidity utilizing guidelines that are contained in a policy developed by
management of the Bank and approved by the Bank's Board of Directors. The Bank's
several liquidity measurements are evaluated on a frequent basis. The Bank was
in compliance with this policy as of September 30, 2003. The levels of the
Bank's short-term liquid assets are dependent on the Bank's operating, financing
and investing activities during any given period. The most significant liquidity
challenge the Bank faces is the variability in cash flows as a result of
mortgage refinance activity. As mortgage interest rates decline, customers'
refinance activities tend to accelerate, causing the cash flow from both the
mortgage loan portfolio and the mortgage-backed securities portfolio to
accelerate. When mortgage interest rates increase, the opposite effect tends to
occur. In addition, as mortgage interest rates decrease, customers generally
tend to prefer fixed rate mortgage loan products over variable rate products.
Since the Bank generally sells its 15-year and 30-year fixed rate loan
production into the secondary mortgage market, the origination of such products
for sale does not significantly reduce the Bank's liquidity.

         During the fiscal year ended March 31, 2002 ("fiscal 2002"), the
Federal Open Market Committee reduced the federal funds rate on eight separate
occasions by a total of 325 basis points, resulting in a lower interest rate
environment in fiscal 2002 compared to the fiscal year ended March 31, 2001.
During the fiscal year ended March 31, 2003 ("fiscal 2003"), the federal funds
rate was again lowered on three separate occasions a total of 125 basis points.
To date, during fiscal 2004 the federal funds rate has remained unchanged. The
increase in loan and securities repayments experienced by the Bank over the past
two fiscal years was primarily the result of the increase in mortgage loan
refinancing activity caused by this lower interest rate environment.

         The Office of Thrift Supervision (the "OTS"), the Bank's primary
federal regulator, requires that the Bank meet minimum capital requirements.
Capital adequacy is one of the most important factors used to determine the
safety and soundness of individual banks and the banking system. At September
30, 2003, the Bank exceeded all regulatory minimum capital requirements and
qualified, under OTS regulations, as a well-capitalized institution. The table
below presents certain information relating to the Bank's capital compliance at
September 30, 2003.


                                       11
<PAGE>

<TABLE>
<CAPTION>
                                     REGULATORY CAPITAL
                                   AT SEPTEMBER 30, 2003

                                                                  Amount       % of Assets
                                                                  ------       -----------
<S>                                                                <C>               <C>
Total capital (to risk-weighted assets):
Capital level                                                      $59,337          17.83 %
Less requirement                                                    26,622           8.00
                                                               ------------  -------------
Excess                                                             $32,715           9.83 %
                                                               ============  =============

Tier 1 capital (to risk-weighted assets):
Capital level                                                      $55,224          10.51 %
Less requirement                                                    21,022           4.00
                                                               ------------  -------------
Excess                                                             $34,202           6.51 %
                                                               ============  =============

Tier 1 Leverage capital (to adjusted total assets):
Capital level                                                      $55,224          16.59 %
Less requirement                                                    13,311           4.00
                                                               ------------  -------------
Excess                                                             $41,913          12.59 %
                                                               ============  =============
</TABLE>

         On October 23, 2003, the Board of Directors declared a quarterly
dividend of $0.05 per common share. The dividend will be payable on November 18,
2003 to stockholders of record at the close of business on November 3, 2003.

ANALYSIS OF EARNINGS

        The Company's profitability is primarily dependent upon net interest
income, which mainly represents the difference between income on
interest-earning assets and expense on interest-bearing liabilities. Net
interest income is dependent on the difference between the average balances and
rates earned on interest-earning assets and the average balances and rates paid
on interest-bearing liabilities. Provisions for loan losses, non-interest
income, non-interest expense and income taxes further affect net income. The
earnings of the Company are significantly affected by general economic and
competitive conditions, particularly changes in market interest rates, and to a
lesser extent by government policies and actions of regulatory authorities.

        The following tables set forth, for the periods indicated, certain
information relating to Carver's average interest-earning assets, average
interest-bearing liabilities, net interest income, interest rate spread and
interest rate margin. It reflects the average yield on assets and the average
cost of liabilities. Such yields and costs are derived by dividing annualized
income or expense by the average balances of assets or liabilities,
respectively, for the periods shown. Average balances are derived from daily or
month-end balances as available. Management does not believe that the use of
average monthly balances instead of average daily balances has caused any
material difference in information presented. The average balance of loans
includes loans on which the Company has discontinued accruing interest. The
yield and cost include fees, which are considered adjustments to yields.


                                       12

<PAGE>

<TABLE>
<CAPTION>
                                                                      THREE MONTHS ENDED SEPTEMBER 30,
                                         -----------------------------------------------------------------------------------
                                                            2003                                     2002
                                         --------------------------------------------- --------------------------------------
                                            Average                   Annualized Avg.    Average              Annualized Avg.
                                            Balance      Interest       Yield/Cost       Balance    Interest   Yield/Cost
                                         -------------- ------------  ---------------  ------------ ------------------------
                                                                         (Dollars in thousands)
<S>                                           <C>            <C>               <C>        <C>          <C>            <C>
Loans receivable (1)                          $305,391       $5,061            6.58%      $282,684     $5,310         7.45%
Investment securities (2)                      172,311        1,515            3.49%       110,036      1,372         4.95%
Federal funds                                   11,622           26            0.90%        17,871         77         1.72%
                                         -------------- ------------                   ------------ ----------
Total interest earning assets                  489,324        6,602            5.35%       410,591      6,759         6.53%
Non-interest earning assets                     31,459                                      31,429
                                         --------------                                ------------
Total assets                                  $520,783                                    $442,020
                                         ==============                                ============

Liabilities and Equity
----------------------
Deposits:
NOW accounts                                   $25,472          $23            0.36%       $17,948        $33         0.73%
Savings and club accounts                      131,435          243            0.73%       127,002        373         1.17%
Money market accounts                           27,341           54            0.78%        15,660         46         1.17%
Certificates of deposit                        161,118          813            2.00%       152,330      1,017         2.65%
                                         -------------- ------------                   ------------ ----------
Total deposits                                 345,366        1,133            1.30%       312,940      1,469         1.86%
Mortgagor's deposits                             1,183           10            3.49%         2,506          1         0.16%
Borrowed money                                 104,927          943            3.56%        67,904        740         4.32%
                                         -------------- ------------                   ------------ ----------
Total interest-bearing liabilities             451,476        2,086            1.82%       383,350      2,210         2.29%
Non-interest-bearing DDA accounts               18,319                                      14,169
Other non-interest-bearing liabilities           6,873                                       6,530
                                         --------------                                ------------
Total liabilities                              476,668                                     404,049
Guaranteed beneficial interest in junior
subordinated debentures                          1,904
Stockholders' equity                            42,211                                      37,971
                                         --------------                                ------------
Total liabilities and stockholders'
equity                                        $520,783                                    $442,020
                                         ============== ------------                   ============ ----------
Net interest income                                          $4,516                                    $4,549
                                                        ============                                ==========
Interest rate spread                                                           3.53%                                  4.24%
                                                                      ===============                         ==============

Net interest margin                                                            3.66%                                  4.40%
                                                                      ===============                         ==============

Ratio of average interest-earning assets to
deposits and interest-bearing liabilities                     1.08x                                     1.07x
                                                        ============                                ==========
</TABLE>

(1) Includes non-accrual loans.
(2) Includes FHLB-NY stock.


                                       13

<PAGE>

<TABLE>
<CAPTION>
                                                                      SIX MONTHS ENDED SEPTEMBER 30,
                                         -----------------------------------------------------------------------------------
                                                           2003                                      2002
                                         --------------------------------------------- --------------------------------------
                                            Average                   Annualized Avg.    Average              Annualized Avg.
                                            Balance      Interest       Yield/Cost       Balance    Interest   Yield/Cost
                                         -------------- ------------  ---------------  ------------ ------------------------
                                                                         (Dollars in thousands)
<S>                                           <C>            <C>               <C>        <C>         <C>             <C>
Loans receivable (1)                          $300,782       $9,927            6.58%      $284,092    $10,688         7.50%
Investment securities (2)                      170,004        3,111            3.65%       105,318      2,652         5.02%
Federal funds                                   15,289           81            1.07%        22,201        188         1.69%
                                         -------------- ------------                   ------------ ----------
Total interest earning assets                  486,075       13,119            5.38%       411,611     13,528         6.55%
Non-interest earning assets                     30,227                                      30,422
                                         --------------                                ------------
Total assets                                  $516,302                                    $442,033
                                         ==============                                ============

Liabilities and Equity
----------------------
Deposits:
NOW accounts                                   $23,624          $48            0.41%       $18,815        $81         0.86%
Savings and club accounts                      131,190          563            0.86%       127,724        816         1.27%
Money market accounts                           26,421          116            0.88%        15,224         96         1.26%
Certificates of deposit                        161,606        1,678            2.07%       152,187      2,078         2.72%
                                         -------------- ------------                   ------------ ----------
Total deposits                                 342,841        2,405            1.40%       313,950      3,071         1.95%
Mortgagor's deposits                             1,711           15            1.72%         2,506          2         0.16%
Borrowed money                                 102,731        1,896            3.68%        66,107      1,476         4.45%
                                         -------------- ------------                   ------------ ----------
Total interest-bearing liabilities             447,283        4,316            1.92%       382,563      4,549         2.37%
Non-interest-bearing DDA accounts               19,301                                      14,041
Other non-interest-bearing liabilities           7,120                                       7,872
                                         --------------                                ------------
Total liabilities                              473,704                                     404,476
Guaranteed beneficial interest in
junior subordinated debentures                     957
Stockholders' equity                            41,641                                      37,557
                                         --------------                                ------------
Total liabilities and stockholders'
equity                                        $516,302                                    $442,033
                                         ============== ------------                   ============ ----------
Net interest income                                          $8,803                                    $8,979
                                                        ============                                ==========
Interest rate spread                                                           3.46%                                  4.18%
                                                                      ===============                         ==============

Net interest margin                                                            3.61%                                  4.35%
                                                                      ===============                         ==============

Ratio of average interest-earning
assets to deposits and interest-
bearing liabilities                                            1.09x                                     1.08x
                                                        ============                                ==========
</TABLE>

(1) Includes non-accrual loans.
(2) Includes FHLB-NY stock.


                                       14
<PAGE>

COMPARISON OF OPERATING RESULTS FOR THE
THREE MONTHS ENDED SEPTEMBER 30, 2003 AND 2002

OVERVIEW

         Selected operating ratios for the three months ended September 30, 2003
and 2002 are set forth in the table below. The following analysis discusses the
changes in components of operating results giving rise to net income.

                                                       THREE MONTHS ENDED
SELECTED OPERATING RATIOS:                                SEPTEMBER 30,
                                                      2003            2002
                                                 ---------------  -------------

Return on average assets(1)                            1.10 %         0.85 %
Return on average equity(1)                           13.51           9.85
Interest rate spread(1)                                3.53           4.24
Net interest margin(1)                                 3.66           4.40
Operating expenses to average assets(1)                3.01           3.20
Equity-to-assets                                       8.12           8.30
Efficiency ratio                                      64.25          67.10
Average interest-earning assets to
  interest-bearing liabilities                        1.08x          1.07x

(1)  Annualized

NET INCOME

         Net income for the three-month period ended September 30, 2003 was $1.4
million compared to net income of $935,000 for the corresponding prior year
period. Net income available to common stockholders (after adjustment for
dividends payable on the Company's preferred stock) was $1.4 million, or $0.55
per diluted common share, compared to $886,000, or $0.37 per diluted common
share, for the corresponding prior year period. Net income available to common
stockholders increased $491,000 primarily due to an increase in non-interest
income of $858,000, partially offset by an increase in non-interest expense of
$357,000. Income for the three months ended September 30, 2003 includes a
recovery of $558,000 related to previously unrecognized income from prior fiscal
year periods from mortgage loans.

INTEREST INCOME

         Interest income decreased by $157,000, or 2.3%, to $6.6 million for the
three months ended September 30, 2003 compared to $6.8 million in the prior year
period. Interest income decreased primarily as a result of the lower interest
rate environment compared to the prior year period. The change in total interest
income was attributable to a decrease of 118 basis points in the annualized
average yield on interest-earning assets to 5.35% for the three months ended
September 30, 2003 compared to 6.53% for the prior year period. This was
partially offset by an increase in the average balance of interest-earning
assets of $78.7 million, or 19.2%, to $489.3 million for the three months ended
September 30, 2003 compared to $410.6 million for the prior year period. Net
interest margin declined 74 basis points to 3.66% for the three months ended
September 30, 2003 compared to 4.40% for the prior year period resulting from
lower interest rates.

         Interest income on loans decreased by $249,000 or 4.7%, to $5.1 million
for the three months ended September 30, 2003 compared to $5.3 million for the
prior year period. The change was primarily due to a decline in interest rates,
which resulted in decreased yields in the loan portfolio. The annualized average
yield on loans for the three months ended September 30, 2003 declined 87 basis
points to 6.58% compared to 7.45% for the prior year period. The decline in
interest income on loans was partially offset by an increase in average mortgage
loan balances of $22.7 million to $305.4 million compared to $282.7


                                       15
<PAGE>

million for the prior year period.

         Interest income on total securities increased by $143,000, or 10.4%, to
$1.5 million for the three months ended September 30, 2003 compared to $1.4
million for the prior year period. The change was primarily due to an increase
of $62.3 million, or 56.6%, in the average balance of securities to $172.3
million compared to $110.0 million in the prior year period, partially offset by
a 146 basis point decrease in the annualized average yield on securities to
3.49% from 4.95% in the prior year period. The growth in the average balance of
securities, primarily mortgage-backed securities, reflects execution of our
balance sheet management strategy. Portfolio yields and interest income declined
as new purchases and the reinvestment of portfolio cash flows were at yields
significantly below existing portfolio yields. To mitigate interest rate risk,
we have purchased short duration securities that by their nature have lower
yields. Additionally, yields and income were impacted by prepayment activity,
which has shortened the anticipated life of mortgage-backed securities and
accelerated premium amortization.

         Interest income on federal funds sold decreased by $51,000, or 66.2%,
to $26,000 for the three months ended September 30, 2003 compared to $77,000 for
the prior year period. The decline was primarily attributable to a decrease in
the average balance of federal funds of $6.2 million, or 35.0%, to $11.6 million
from $17.9 million in the prior year period. Also contributing to the decline in
interest income was a decrease of 82 basis points in the annualized yield on
federal funds sold, which was 0.90% for the three months ended September 30,
2003 compared to 1.72% in the prior year period due to lower short-term interest
rates.

INTEREST EXPENSE

         Total interest expense decreased by $124,000, or 5.6%, to $2.1 million
for the three months ended September 30, 2003 compared to $2.2 million for the
prior year period. The change in interest expense is primarily due to the lower
interest rate environment cited above. The annualized average cost of
interest-bearing liabilities decreased 47 basis points to 1.82% from 2.29% for
the prior year period. The decrease in interest expense was partially offset by
an increase in the average balance of interest-bearing liabilities of $68.1
million, or 17.8%, to $451.5 million from $383.4 million during to the prior
year period.

         Interest expense on deposits decreased $336,000, or 22.9%, to $1.1
million for the three months ended September 30, 2003 compared to $1.5 million
for the prior year period. The decrease in interest expense on deposits was due
primarily to a 56 basis point decline in the rate paid on deposits to 1.30%
compared to 1.86% for the prior year period, partially offset by a $32.4 million
increase in the average balance of interest-bearing deposits to $345.4 million
for the three months ended September 30, 2003 from $312.9 million for the prior
year period. Customer deposits have historically provided Carver with a
relatively low cost funding source from which its net interest income and net
interest margin have benefited. The Bank's success in growing core deposits,
thereby benefiting net interest income and net interest margin, has been
tempered by the sustained low interest rate environment.

         Interest expense on advances and other borrowed money increased
$212,000, or 28.6%, to $953,000 for the three months ended September 30, 2003
compared to $741,000 for the prior year period. This was primarily due to an
increase of $37.0 million in the average balance of borrowed money to $104.9
million from $67.9 million for the corresponding prior year period, partially
offset by a decrease of 76 basis points in the cost of borrowings to 3.56% from
4.32% for the prior year period.

NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES

         Net interest income before the provision for loan losses was
substantially unchanged at $4.5 million for the three months ended September 30,
2003 compared to the prior year period. The Company's annualized average
interest rate spread decreased by 71 basis points to 3.53% for the three months
ended September 30, 2003 compared to 4.24% for the prior year period.

PROVISION FOR LOAN LOSSES AND ASSET QUALITY


                                       16
<PAGE>

         The Company did not provide for additional loan loss reserves for the
three months ended September 30, 2003 or 2002 as the Company considers the
overall allowance for loan losses to be adequate. During the second quarter of
fiscal 2004, the Company recorded net loan charge-offs of $10,000 compared to
net recoveries of $40,000 for the prior year period. At September 30, 2003, the
Bank's allowance for loan losses was $4.1 million compared to $4.2 million at
March 31, 2003.

         At September 30, 2003, non-performing assets totaled $2.9 million, or
0.91% of total loans, compared to $1.8 million, or 0.61% of total loans
receivable, at March 31, 2003. Non-performing assets include loans 90 days past
due, non-accrual loans and other real estate owned. Other real estate owned
consists of property acquired through foreclosure or deed in lieu of
foreclosure. The Bank had no foreclosed real estate as of September 30, 2003.
The increase of $1.1 million in non-performing loans is primarily attributable
to three loans that were 90 days past due at September 30, 2003. Future levels
of non-performing assets will be influenced by economic conditions, including
the impact of those conditions on our customers, interest rates and other
internal and external factors existing at the time.

         The ratio of the allowance for loan losses to non-performing loans was
141.8% at September 30, 2003 compared to 230.7% at March 31, 2003. The ratio of
the allowance for loan losses to total loans was 1.29% at September 30, 2003
compared to 1.40% at March 31, 2003.

         Management's judgment in determining the adequacy of the allowance for
loan losses is based on an evaluation of individual loans, the risk
characteristics and size of the loan portfolio, an assessment of current
economic and real estate market conditions, estimates of the current value of
underlying collateral, past loan loss experience, review of regulatory authority
examination reports and other relevant factors. Based on the process employed,
management believes that the allowance for loan losses is adequate under
prevailing economic conditions to absorb losses on existing loans that may
become uncollectible. While management estimates loan losses using the best
available information, no assurance can be made that future adjustments to the
allowance will not be necessary based on changes in economic and real estate
market conditions, further information obtained regarding known problem loans,
identification of additional problem loans, results of regulatory examinations
and other factors, both within and outside of management's control.

NON-INTEREST INCOME

         Total non-interest income in the second quarter of fiscal 2004
increased $858,000, or 119.8%, to $1.6 million compared to $716,000 for the
prior year period. The increase was primarily attributable to a recovery of
$558,000 in mortgage income of which $411,000 related to the recognition of
previously unrecognized mortgage loan income from one problem loan that had been
held in escrow pending the resolution of certain mechanics' liens. The remaining
$147,000 resulted from the recognition of previously unrecognized prepaid
mortgage loan income. Further contributing to the increase in non-interest
income was an increase in loan fees and service charges of $235,000 and an
increase of $33,000 in depository fees and charges, which can be attributed to
increased ATM usage, growth in debit card income and the restructuring of
depository fees and charges during the second quarter of fiscal 2003. Loan fees
and service charges increased primarily as a result of recognition of higher
mortgage prepayment penalties due to refinancing activity. A gain on the sale of
securities of $31,000 was recognized as a result of the sale of certain
mortgage-backed securities in the second quarter of fiscal 2004. Non-interest
income represented 19.3% of revenue (interest income plus non-interest income)
for the second quarter of fiscal 2004 compared to 9.6% for the corresponding
prior year period.

NON-INTEREST EXPENSE

         For the quarter ended September 30, 2003, total non-interest expense
increased $380,000, or 10.8%, to $3.9 million compared to $3.5 million for the
prior year period. The increase in non-interest expense was primarily due to a
rise in employee compensation and benefit expense resulting from salary
increases effective as of September 1, 2003, new hires at higher average
salaries, an increase in the costs to


                                       17
<PAGE>

provide employee benefits and the timing of accruals for employee bonus
expense. It is the Bank's policy that employee bonuses are expensed in each
quarter when the performance of the Bank indicates that they will likely be
earned by year-end. In fiscal 2003 the application of this policy resulted in
the majority of employee bonuses being both earned and expensed in the fourth
quarter, whereas in fiscal 2004, due to the performance of the Bank, more
employee bonuses have been expensed earlier in the year. Additionally, the
capital securities cost of $23,000 related to the issuance of the subordinated
debentures during the second quarter was minimal as the securities were issued
in mid-September.

INCOME TAX EXPENSE

         For the three-month period ended September 30, 2002, the Company
accrued for Federal, New York State and New York City income tax expense at a
combined total tax rate of 45%. For the three-month period ended September 30,
2003, the Company decreased its tax rate following the establishment of Carver
Asset Corporation, the Bank's real estate investment trust.

         For the three-month period ended September 30, 2003, income before
taxes increased $445,000, or 25.7%, to $2.2 million compared to $1.7 million for
the prior year period. Income tax expense decreased $46,000, or 5.8%, to
$751,000 compared to $797,000 for the prior year period.

COMPARISON OF OPERATING RESULTS FOR THE
SIX MONTHS ENDED SEPTEMBER 30, 2003 AND 2002

OVERVIEW

         Selected operating ratios for the six months ended September 30, 2003
and 2002 are set forth in the table below. The following analysis discusses the
changes in components of operating results giving rise to net income.

                                                      SIX MONTHS ENDED
SELECTED OPERATING RATIOS:                              SEPTEMBER 30,
                                                     2003            2002
                                                ---------------  -------------

Return on average assets(1)                           0.97 %         0.82 %
Return on average equity(1)                          12.07           9.64
Interest rate spread(1)                               3.46           4.18
Net interest margin(1)                                3.61           4.35
Operating expenses to average assets(1)               2.98           3.32
Equity-to-assets                                      8.12           8.30
Efficiency ratio                                     66.81          68.81
Average interest-earning assets to
  interest-bearing liabilities                       1.09x          1.08x

(1)  Annualized

NET INCOME

         The Company reported net income for the six-month period ended
September 30, 2003 of $2.5 million compared to net income of $1.8 million for
the corresponding prior year period. Net income available to common stockholders
(after adjustment for dividends payable on the Company's preferred stock) was
$2.4 million, or $0.98 per diluted common share, compared to $1.7 million, or
$0.72 per diluted common share, for the corresponding prior year period. Income
for the six months ended September 30, 2003 includes a recovery of $558,000
related to previously unrecognized income from prior fiscal year periods from
mortgage loans. This recovery was recorded in other non-interest income. Net
income available to common stockholders increased $703,000 primarily due to a
rise in non-interest income of $1.0


                                       18
<PAGE>

million, partially offset by an increase in non-interest expense of $344,000.

INTEREST INCOME

         Interest income decreased by $409,000, or 3.0%, to $13.1 million for
the six months ended September 30, 2003 compared to $13.5 million in the
corresponding prior year period. The decrease in interest income was due to a
lower interest rate environment during the six-month period ended September 30,
2003 compared to the corresponding prior year period. The change in total
interest income was attributable to a decrease of 117 basis points in the
annualized average yield on interest-earning assets to 5.38% for the six months
ended September 30, 2003 compared to 6.55% for the corresponding prior year
period. This was partially offset by an increase in the average balance of
interest-earning assets of $74.5 million, or 18.1%, to $486.1 million for the
six months ended September 30, 2003 compared with $411.6 million for the
corresponding prior year period.

         Interest income on loans decreased by $761,000, or 7.1%, to $9.9
million for the six months ended September 30, 2003 compared to $10.7 million
for the corresponding prior year period. The decline in interest income was due
primarily to a decrease in the annualized average yield on mortgage loans to
6.58% compared to 7.50% for the six months ended September 30, 2002.
Additionally, the decrease in interest income was due to the inclusion of an
acceleration in the recognition of deferred loan fees of $212,000 resulting from
higher than anticipated mortgage loan prepayments in the income of the prior
fiscal year. The decrease in interest income on loans was offset by an increase
in average mortgage loan balances of $16.7 million, or 5.9%, to $300.8 million
for the six months ending September 30, 2003 compared to $284.1 million for the
corresponding prior year period.

         Interest income on total securities increased by $459,000, or 17.3%, to
$3.1 million for the six months ended September 30, 2003 compared to $2.7
million for the corresponding prior year period. The change was primarily due to
an increase in the average balance of total securities of $64.7 million, or
61.4%, to $170.0 million for the six months ended September 30, 2003 compared to
$105.3 million for the corresponding prior year period, partially offset by a
decrease in the annualized average yield on mortgage-backed securities of 137
basis points to 3.65% from 5.02% during the same period.

         Interest income on federal funds sold decreased by $107,000, or 56.9%,
to $81,000 for the six months ended September 30, 2003 compared to $188,000 for
the corresponding prior year period. The annualized yield on federal funds sold
declined 62 basis points to 1.07% for the six months ended September 30, 2003
compared to 1.69% for the corresponding prior year period due to a lower
short-term interest rate environment. In addition, the average balance of
federal funds decreased $6.9 million, or 31.1%, to $15.3 million from $22.2
million for the corresponding prior year period.

INTEREST EXPENSE

         Total interest expense decreased by $233,000, or 5.1%, to $4.3 million
for the six months ended September 30, 2003 compared to $4.5 million for the
corresponding prior year period. The reduction in interest expense is primarily
due to the lower interest rate environment partially offset by higher average
borrowings year over year to fund the growth of the balance sheet. The
annualized average cost of interest-bearing liabilities decreased 45 basis
points to 1.92% from 2.37% for the corresponding prior year period. The decrease
in the average cost of interest-bearing liabilities was partially offset by an
increase in the average balance of interest-bearing liabilities of $64.7
million, or 16.9%, to $447.3 million from $382.6 million compared to the
corresponding prior year period.


                                       19
<PAGE>

         Interest expense on deposits decreased $666,000, or 21.7%, to $2.4
million for the six months ended September 30, 2003 compared to $3.1 million for
the corresponding prior year period. The decrease in interest expense on
deposits was due primarily to a 55 basis point decline in the rate paid on
deposits to 1.40% for the six months ended September 30, 2003 compared to 1.95%
for the corresponding prior year period. This was partially offset by a $28.9
million increase in the average balance of interest-bearing deposits to $342.8
million from $314.0 million for the corresponding prior year period.

         Interest expense on advances and other borrowed money increased
$433,000, or 29.3%, to $1.9 million for the six months ended September 30, 2003
compared to $1.5 million for the corresponding prior year period. This increase
in interest expense was primarily due to a $36.6 million, or 55.4%, increase in
the average balance of borrowed money to $102.7 million from $66.1 million for
the corresponding prior year period, partially offset by a decrease of 77 basis
points in the cost of borrowings to 3.68% from 4.45% for the corresponding prior
year period.

NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES

         Net interest income before the provision for loan losses decreased by
$176,000, or 2.0%, to $8.8 million for the six months ended September 30, 2003
compared to $9.0 million for the corresponding prior year period. Total interest
income decreased by $409,000 while total interest expense decreased by $233,000
for the six months ended September 30, 2003. The Company's annualized average
interest rate spread decreased by 72 basis points to 3.46% for the six months
ended September 30, 2003 compared to 4.18% for the corresponding prior year
period.

PROVISION FOR LOAN LOSSES AND ASSET QUALITY

         The Company did not provide for additional loan losses for each
six-month period ended September 30, 2003 and 2002. Due to the credit quality of
the loan portfolio at period end, the Company believed the total loan loss
allowance to be adequate. During the first six months of fiscal 2004, Carver
recorded net loan charge-offs of $45,000 to the allowance for loan losses
compared to net recoveries of $44,000 for the corresponding prior year period.
At September 30, 2003, the Bank's allowance for loan losses at $4.1 million
compared to $4.2 million at March 30, 2003.

         At September 30, 2003, non-performing loans totaled $2.9 million, or
0.91% of total loans, compared to non-performing loans of $1.8 million, or 0.61%
of total loans, at March 31, 2003, an increase of $1.1 million or 61.0%. The
increase in non-performing loans lowered the ratio of the allowance for loan
losses to non-performing loans to 141.8% at September 30, 2003 compared to
230.7% at March 31, 2003. The ratio of the allowance for loan losses to total
loans at September 30, 2003 was 1.29% compared to 1.40% March 31, 2003.

         Management's judgment in determining the adequacy of the allowance for
loan losses is based on an evaluation of individual loans, the risk
characteristics and size of the loan portfolio, an assessment of current
economic and real estate market conditions, estimates of the current value of
underlying collateral, past loan loss experience, review of regulatory authority
examination reports and other relevant factors. Based on the process employed,
management believes that the allowance for loan losses is adequate under
prevailing economic conditions to absorb losses on existing loans that may
become uncollectible. While management estimates loan losses using the best
available information, no assurance can be made that future adjustments to the
allowance will not be necessary based on changes in economic and real estate
market conditions, further information obtained regarding known problem loans,
identification of additional problem loans and other factors, both within and
outside of management's control.

NON-INTEREST INCOME

         Total non-interest income increased $1.0 million, or 62.6%, to $2.7
million for the six-month period ended September 30, 2003 compared to $1.7
million for the corresponding prior year period. The increase in non-interest
income resulted from increases in depository fees and charges, loan fees and


                                       20
<PAGE>

service charges and other non-interest income. The increases in loan fees and
service charges as well as depository fees and charges were primarily due to
higher mortgage prepayment penalties, increases in ATM usage over the
corresponding prior year period, growth in debit card income and a restructuring
of loan and depository fees and service charges which began in the second
quarter of fiscal 2003. Other non-interest income increased as a result of a
recovery of $558,000 of which $411,000 was related to the recognition of
previously unrecognized mortgage loan income from one problem loan that had been
held in escrow pending the resolution of certain mechanics' liens. The remaining
recovery of $147,000 was from previously unrecognized prepaid mortgage loan
income. In an effort to reposition the balance sheet, the Company sold
investment securities during the second quarter of fiscal 2004 that generated a
net gain on sale of securities of $31,000.

NON-INTEREST EXPENSE

         Total non-interest expense increased $367,000, or 5.0%, to $7.7 million
for the six months ended September 30, 2003 compared to $7.3 million for the
corresponding prior year period. The increase was primarily attributable to
increases in employee compensation and benefits. Employee compensation and
benefit expense was higher year over year by $340,000 as a result of salary
increases, new hires at higher average salaries, increased cost of benefit plans
and the timing of accruals for employee bonus expense. Additionally, the
capital securities cost of $23,000 related to the issuance of the subordinated
debentures during the period was minimal as the securities were issued in
mid-September. Other non-interest expense includes a $204,000 increase in
consulting expenses related to establishing the Bank's real estate investment
trust, offset by reductions in advertising expense of $124,000 and loan expenses
of $77,000.

INCOME TAX EXPENSE

         For the six-month period ended September 30, 2002, the Company accrued
for Federal, New York State and New York City income tax expense at a combined
total tax rate of 45%. For the six-month period ended September 30, 2003, the
Company decreased its rate following the establishment of Carver Asset
Corporation.

         For the six-month period ended September 30, 2003, income before taxes
increased $502,000, or 15.1%, to $3.8 million compared to $3.3 million for the
prior year period. Income tax expense decreased $201,000, or 13.3%, to $1.3
million compared $1.5 million for the prior year period.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

         Quantitative and qualitative disclosure about market risk is presented
at March 31, 2003 in Item 7 of the Company's 2003 10-K. The Company believes
that there have been no material changes in the Company's market risk at
September 30, 2003 compared to March 31, 2003.

ITEM 4.  CONTROLS AND PROCEDURES

           The Company maintains controls and procedures designed to ensure that
information required to be disclosed in the reports that the Company files or
submits under the Securities Exchange Act of 1934 ("Exchange Act") is recorded,
processed, summarized and reported within the time periods specified in the
rules and forms of the SEC. As of September 30, 2003, the Company carried out an
evaluation, under the supervision and with the participation of the Company's
management, including the Company's Chief Executive Officer and Chief Financial
Officer, of the effectiveness of the Company's disclosure controls and
procedures pursuant to Exchange Act Rule 13a-15. Based on that evaluation, the
Chief Executive Officer and Chief Financial Officer concluded that the Company's
disclosure controls and procedures are effective and timely in alerting them to
material information relating to the Company (including its consolidated
subsidiaries) required to be included in the Company's periodic SEC filings.


                                       21
<PAGE>

         There were no changes in our internal control over financial reporting
that occurred during the period covered by this report that has materially
affected, or is reasonably likely to materially affect, our internal control
over financial reporting.

PART II.          OTHER INFORMATION

ITEM 1.           LEGAL PROCEEDINGS


         Disclosure regarding legal proceedings that the Company is a party to
is presented in Note 13 to our Consolidated Financial Statements in the 2003
10-K. Except as set forth below, there have been no material changes with regard
to such legal proceedings since the filing of the 2003 10-K.

         On or about April 29, 1999, plaintiff Reginald St. Rose ("St. Rose"), a
former Carver Federal employee, filed suit against Carver Federal in the Supreme
Court of the State of New York, County of New York (the "St. Rose Action"). In
his complaint, St. Rose alleged the following causes of action relating to a
January 12, 1999 agreement between the parties concerning St. Rose's separation
from Carver Federal: (1) breach of contract; (2) promissory estoppel, and (3)
fraudulent misrepresentation. On Carver Federal's motion, the Court dismissed
the fraudulent misrepresentation claim. St. Rose seeks damages in an amount not
less than $50,000 with respect to the breach of contract cause of action and
seeks undisclosed damages with respect to the promissory estoppel claim. Carver
Federal has not yet filed an answer to the remaining two claims because its time
to do so has been extended without date. Carver Federal has unasserted
counterclaims against St. Rose for, among other claims, payment of certain
financial obligations to Carver Federal, which obligations remain outstanding as
of the date of this Form 10-Q. Carver Federal and St. Rose have recently resumed
settlement discussions. If the parties do not reach a settlement, Carver Federal
intends to continue to defend the St. Rose Action vigorously.

         Carver Federal is also a defendant in two actions brought by Ralph
Williams ("Williams I" and "Williams II") and an action brought by Janice
Pressley (the "Pressley Action") all of which arise out of events concerning the
Northeastern Conference Federal Credit Union ("Northeastern"), a federal credit
union that maintained accounts with Carver Federal and certain other banks in
the New York metropolitan area (the "Bank Defendants"). Plaintiff Williams is a
former member of the Board of Directors of Northeastern and plaintiff Pressley
is a former treasurer of Northeastern. Plaintiffs allege that the National
Credit Union Administration (the "NCUA") acted improperly when it placed
Northeastern into conservatorship and subsequent liquidation. In or about July
1998, Williams commenced Williams I in the United States District Court,
District of Columbia seeking to restrain the NCUA from executing on the
conservatorship order and an order directing the Bank Defendants to "restore
[their] accounts to their original status." The Bank Defendants were not served
with the pleadings in Williams I, and the Court entered judgment against them on
default. After the Bank Defendants learned of this case, they made a motion in
September 2001 to vacate the default judgment. That motion is still pending.

         On or about November 22, 2000, Williams filed Williams II in the United
States District Court, District of Columbia, against the NCUA and the Bank
Defendants seeking damages in the amount of $1 million plus certain additional
unspecified amounts, and plaintiff Pressley filed the Pressley Action in the
same court against the same defendants seeking unspecified compensatory and
punitive damages. Williams seeks damages for the allegedly "unauthorized" or
"invalid" actions of the NCUA Board of Directors in taking control of
Northeastern as well as damages for discrimination and civil rights violations.
Pressley seeks damages based on identical allegations except that she also
alleges certain claims of employment discrimination.

         The Bank Defendants filed a joint motion to dismiss Williams II, which
motion was granted by the District Court. Williams filed a notice of appeal on
August 24, 2003. Pursuant to a scheduling order issued by the Court, Carver
Federal filed a Notice of Appearance, Certificate of Counsel and Disclosure
Statement. The Bank Defendants collectively filed a motion for summary
affirmance of the District Court's decision on October 9, 2003. The scheduling
order required that Williams make certain submissions on or before September 24,
2003 in support of his appeal. Williams failed to do so and the Court issued an
order


                                       22
<PAGE>

directing Williams to show cause by November 7, 2003 why the appeal should not
be dismissed for want of prosecution. On November 7, 2003, Williams filed an
answer to the order to show cause and a motion for leave to file his submissions
late. The court has not yet ruled on that motion as of the date of filing of
this Form 10-Q.

         The Bank Defendants also made a joint motion to dismiss the Pressley
Action. In September 2001, the District Court granted that motion. Pressley
appealed the decision and the Court of Appeals remanded the case for a
clarification by the District Court of its order as to whether it was a final
order applicable to all of the defendants. The Court of Appeals dismissed the
appeal in August 2003 and, in October 2003 with the consent of Pressley's
counsel, the District Court dismissed Pressley's case against the Bank
Defendants and has entered an order to that effect, resolving the Pressley
Action in its entirety.

         In or about November 2001, Monique Barrow, a former branch teller,
filed an action against Carver Federal in the United States District Court for
the Southern District of New York alleging that Carver Federal's termination of
her employment constituted a violation of the federal Family and Medical Leave
Act and each of the New York State and City Human Rights Laws. Ms. Barrow seeks
back pay, front pay and benefits with interest in an amount not less than $5
million, and punitive, liquidated and other compensatory damages in an amount
not less than $10 million. On August 5, 2003, Carver Federal filed a motion for
summary judgment to dismiss the complaint in its entirety. It is fully
submitted, and Carver Federal awaits the Court's decision.


ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

         None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

         None.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         The Holding Company held its Annual Meeting on September 22, 2003 for
the fiscal year ended March 31, 2003.

         The purpose of the Annual Meeting was to vote on the following
proposals:

         1.       the election of two directors for terms of three years each;

         2.       the ratification of the appointment of KPMG, LLP as
                  independent auditors of the Holding Company for the fiscal
                  year ended March 31, 2004; and

         3.       the approval of an amendment to the Carver Bancorp, Inc
                  Management Recognition Plan.

The results of voting were as follows:

<TABLE>
<CAPTION>
<S>                                                                          <C>
         Proposal 1:      Election of Directors:
                          Holding Company Nominees

                          Robert Holland, Jr.                                For         2,163,382
                                                                             Withheld      153,855

                          Frederick O. Terrell                               For         2,163,357
                                                                             Withheld      153,880

         Proposal 2:      Ratification of Appointment of Independent         For         2,216,277


                                       23
<PAGE>

                          Auditors
                                                                             Withheld       99,374
                                                                             Abstain         1,586

         Proposal 3       Ratification of Amendment to the Carver Bancorp    For         2,095,003
                          Management Recognition Plan                        Withheld      220,323
                                                                             Abstain         1,911
</TABLE>

         In addition to the nominees elected at the Annual Meeting, the
following persons' terms of office as directors continued after the Annual
Meeting: David L. Hinds, Pazel G. Jackson, Jr., Carol Baldwin Moody, Edward B.
Ruggiero, Deborah C. Wright and Strauss Zelnick.

ITEM 5.  OTHER INFORMATION

         None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)      The following exhibits are submitted with this report:

                  Exhibit 4.1       Guarantee Agreement by and between Carver
                                    Bancorp, Inc. and U.S. Bank National
                                    Association, dated as of September 17, 2003.

                  Exhibit 4.2       Amended and Restated Declaration of Trust by
                                    and among, U.S. Bank National Association,
                                    as Institutional Trustee, Carver Bancorp,
                                    Inc. as Sponsor and Linda Dunn, William Gray
                                    and Deborah Wright as Administrators, dated
                                    as of September 17, 2003.

                  Exhibit 4.3       Indenture, dated as of September 17, 2003,
                                    between Carver Bancorp, Inc., as Issuer and
                                    U.S. Bank National Association, as Trustee.

                  Exhibit 11.       Computation of Net Income Per Share.

                  Exhibit 31.1      Certification of Chief Executive Officer.

                  Exhibit 31.2      Certification of Chief Financial Officer.

                  Exhibit 32.1(*)   Written Statement of Chief Executive Officer
                                    furnished pursuant to Section 906 of the
                                    Sarbanes-Oxley Act of 2002, 18 U.S.C.
                                    Section 1350.

                  Exhibit 32.2(*)   Written Statement of Chief Financial Officer
                                    furnished pursuant to Section 906 of the
                                    Sarbanes-Oxley Act of 2002, 18 U.S.C.
                                    Section 1350.

     * Pursuant to SEC rules, this exhibit will not be deemed filed for purposes
     of Section 18 of the Exchange Act or be otherwise subject to the liability
     of that section.

(b)      Current Reports on Form 8-K.

We furnished the following Current Reports on Form 8-K during the quarter ended
September 30, 2003:

         1.       Current report on Form 8-K, dated September 17, 2003, an
                  announcement of private placement of $13 million in Trust
                  Preferred Securities.



                                       24
<PAGE>

         2.       Current report on Form 8-K/A, dated August 18, 2003, which
                  includes information being filed pursuant to Item 12 but was
                  filed under Item 9, an announcement of amendment to the
                  Company's financial results for the first quarter ended June
                  30, 2003.

         3.       Current report on Form 8-K, dated July 23, 2003, which
                  includes information being filed pursuant to Item 12 but was
                  filed under Item 9, an announcement of the Company's financial
                  results for the first quarter ended June 30, 2003.





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<PAGE>

                                   SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                           CARVER BANCORP, INC.


Date: November 14, 2003                    /s/ Deborah C. Wright
                                           -------------------------------------
                                           Deborah C. Wright
                                           President and Chief Executive Officer





Date: November 14, 2003                    /s/ William C. Gray
                                           -------------------------------------
                                           William C. Gray
                                           Senior Vice President
                                            and Chief Financial Officer




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