UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, DC 20549

FORM 10-Q/A(Amendment No. 1)Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2006

Commission file number 000-27481

Rome Bancorp, Inc.(Exact name of registrant as specified in its charter)

|Delaware                        |  | 16-1573070         
|------------------------------- |  | -------------------
|(State or other jurisdiction of |  | (I.R.S. Employer   
|incorporation or organization)  |  | Identification No.)

100 West Dominick Street, Rome, NY 13440-5810(Address of Principal executive offices)(315) 336-7300(Registrant's telephone number, including area code)

Indicate
    by check mark whether the registrant (1) has filed all reports required to
    be filed by Section 13 or 15(d) of the Exchange Act during the preceding
    12 months and (2) has been subject to such filing requirements for the past
    90 days. Yes X No __

Indicate
    by check mark whether the registrant is a large accelerated file, an accelerated
    filer, or a non-accelerated filer.

Large accelerated filer ___                          Accelerated
    filer ___                          Non-accelerated filer _X_

Indicate by check mark whether
    the registrant is a shell company (as defined in rule 12b-2 of the Exchange
    Act.)                Yes __      No _X_

Indicate
    the number of shares outstanding of each class of issuer's classes of common
    stock as of the last practicable date:

|                             |  | Outstanding at 
|---------------------------- |  | ---------------
|Class                        |  | August 10, 2006
|Common Stock, par value $.01 |  | 8,795,020      

Explanatory Note

The purpose of this amended Quarterly Report on Form 10-Q/A of Rome Bancorp, Inc. (the "Company") is to restate the Company's consolidated condensed financial statements for the three and six months ended June 30, 2006
("the financial statements") and to modify the related disclosures. See Note 1 to the financial statements included in this amended Quarterly Report.

The restatement arose from the Company's determination that an error had occurred in the amortization of stock options and restricted share grants made in 2006. The restatement is necessary in order to immediately fully
expense the award of certain stock-based compensation grants at the award date for those recipients who were eligible for retirement at the award grant. The Company had been expensing these grants over a five year service vesting period.

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This amended Quarterly Report does not update or discuss any other Company developments after the date of the original filing. All information contained in this amended Quarterly Report and the
original Quarterly Report is subject to updating and supplementing in the periodic reports that the Company has filed and will file after the original filing date with the Securities and Exchange Commission.

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ROME BANCORP, INC.FORM 10-Q/A FOR THE QUARTER ENDED JUNE 30, 2006

TABLE OF CONTENTS

|         |                                                             |  | PAGE
|-------- | ----------------------------------------------------------- |  | ----
|        
|PART I   | FINANCIAL INFORMATION                                       |  | 4   
|        
|ITEM 1.  | FINANCIAL STATEMENTS (unaudited)(restated):                 |  |     
|         | CONDENSED CONSOLIDATED BALANCE SHEET                        |  | 4   
|         | CONDENSED CONSOLIDATED STATEMENTS OF INCOME                 |  | 5   
|         | CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY    |  | 6   
|         | AND COMPREHENSIVE INCOME                                    |  |     
|         | CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS             |  | 7   
|         | NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL         |  | 9   
|         | STATEMENTS                                                  |  |     
|        
|ITEM 2.  | MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL           |  |     
|         | CONDITION AND RESULTS OF OPERATIONS                         |  | 18  
|ITEM 3.  | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK  |  | 28  
|ITEM 4.  | CONTROLS AND PROCEDURES                                     |  | 28  
|        
|PART II  | OTHER INFORMATION                                           |  |     
|        
|ITEM 1.  | LEGAL PROCEEDINGS                                           |  | 28  
|ITEM 1A. | RISK FACTORS                                                |  | 28  
|ITEM 2.  | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |  | 28  
|ITEM 3.  | DEFAULTS UPON SENIOR SECURITIES                             |  | 28  
|ITEM 4.  | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS         |  | 28  
|ITEM 5.  | OTHER INFORMATION                                           |  | 29  
|ITEM 6.  | EXHIBITS                                                    |  | 29  
|        
|         | SIGNATURES                                                  |  | 30  

1

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PART I FINANCIAL INFORMATION

Item 1. Financial Statements

ROME BANCORP, INC. AND SUBSIDIARYCondensed Consolidated Balance SheetJune 30, 2006 and December 31, 2005(in thousands, except share data)

|                                                                           |  | (unaudited) |         |   |              |   |        
|-------------------------------------------------------------------------- |  | ----------- | ------- | - | ------------ | - | -------
|                                                                           |  | (Restated - |         |   |              |   |        
|                                                                           |  | See Note 1) |         |   |              |   |        
|                                                                           |  | June 30,    |         |   | December 31, |  
|                                                                           |  | 2006        |         |   | 2005         |  
|Assets                                                                     |  |             |         |   |              |   |        
|Cash and due from banks                                                    |  | $           | 6,493   |   |              | $ | 7,457  
|Federal funds sold and other short-term investments                        |  |             | 11,115  |   |              |   | 26,778 
|Total cash and cash equivalents                                            |  |             | 17,608  |   |              |   | 34,235 
|Securities available for sale, at fair value                               |  |             | 5,159   |   |              |   | 9,666  
|Securities held to maturity (fair value of $1,196 and $1,428               |  |             |         |   |              |   |        
|at June 30, 2006 and December 31, 2005, respectively)                      |  |             | 1,202   |   |              |   | 1,440  
|Federal Home Loan Bank Stock                                               |  |             | 813     |   |              |   | 776    
|Loans                                                                      |  |             | 256,423 |   |              |   | 253,878
|Less: Allowance for loan loss                                              |  |             | (1,954  | ) |              |   | (1,960 
|Net loans                                                                  |  |             | 254,469 |   |              |   | 251,918
|Premises and equipment, net                                                |  |             | 4,940   |   |              |   | 4,503  
|Accrued interest receivable                                                |  |             | 1,014   |   |              |   | 1,053  
|Other assets                                                               |  |             | 13,944  |   |              |   | 5,262  
|Total assets                                                               |  | $           | 299,149 |   |              | $ | 308,853
|                                                                          
|Liabilities & Equity                                                       |  |             |         |   |              |   |        
|                                                                          
|Liabilities                                                                |  |             |         |   |              |   |        
|Deposits:                                                                  |  |             |         |   |              |   |        
|Non-interest bearing                                                       |  | $           | 29,703  |   |              | $ | 30,039 
|Savings                                                                    |  |             | 88,070  |   |              |   | 89,138 
|Money market                                                               |  |             | 5,139   |   |              |   | 4,929  
|Time                                                                       |  |             | 69,088  |   |              |   | 66,298 
|Other interest bearing                                                     |  |             | 12,006  |   |              |   | 11,064 
|Total deposits                                                             |  |             | 204,006 |   |              |   | 201,468
|Borrowings                                                                 |  |             | 8,878   |   |              |   | 9,374  
|Other liabilities                                                          |  |             | 4,772   |   |              |   | 4,533  
|Total liabilities                                                          |  |             | 217,656 |   |              |   | 215,375
|                                                                          
|Shareholders' equity                                                       |  |             |         |   |              |   |        
|Common Stock, $.01 par value; authorized: 30,000,000 shares;               |  |             |         |   |              |   |        
|issued and outstanding 9,715,020 and 8,807,120 shares at June 30, 2006 and |  |             |         |   |              |   |        
|9,678,128 and 9,678,128 shares at December 31, 2005                        |  |             | 97      |   |              |   | 97     
|Additional paid-in capital                                                 |  |             | 60,344  |   |              |   | 60,013 
|Retained earnings                                                          |  |             | 35,328  |   |              |   | 35,983 
|Accumulated other comprehensive income                                     |  |             | 38      |   |              |   | 85     
|Treasury stock; 907,900 shares at June 30, 2006                            |  |             | (11,723 | ) |              |   | -      
|Unallocated shares of employee stock ownership plan (ESOP); 439,153        |  |             |         |   |              |   |        
|shares at June 30, 2006 and 462,135 shares at December 31, 2005            |  |             | (2,591  | ) |              |   | (2,700 
|Total shareholders' equity                                                 |  |             | 81,493  |   |              |   | 93,478 
|Total liabilities and shareholders' equity                                 |  | $           | 299,149 |   |              | $ | 308,853

See accompanying notes to unaudited condensed consolidated financial statements.

2

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ROME BANCORP, INC. AND SUBSIDIARYCondensed Consolidated Statements of IncomeFor the Three and Six Months Ended June 30, 2006 and 2005(in thousands, except share data)(unaudited)

|                                                    |  | For the three months ended |       | For the six months ended
|--------------------------------------------------- |  | -------------------------- | ----- | ------------------------
|                                                    |  | June 30,                   |       | June 30,                
|                                                    |  | 2006                       |       |                         
|                                                    |  | (Restated                 |       |                         
|                                                    |  | See Note 1)                |       |                         
|                                                   
|Interest income:                                    |  |                            |       |                         
|Loans                                               |  | $                          | 4,011 |                         
|Securities                                          |  |                            | 100   |                         
|Other short-term investments                        |  |                            | 276   |                         
|Total interest income                               |  |                            | 4,387 |                         
|                                                   
|Interest expense:                                   |  |                            |       |                         
|Deposits                                            |  |                            | 774   |                         
|Borrowings                                          |  |                            | 79    |                         
|Total interest expense                              |  |                            | 853   |                         
|                                                   
|Net interest income                                 |  |                            | 3,534 |                         
|                                                   
|Provision for loan losses                           |  |                            | -     |                         
|Net interest income after provision for loan losses |  |                            | 3,534 |                         
|                                                   
|Non-interest income:                                |  |                            |       |                         
|Net gain on securities transactions                 |  |                            | -     |                         
|Other                                               |  |                            | 466   |                         
|Total non-interest income                           |  |                            | 466   |                         
|                                                   
|                                                   
|Non-interest expense:                               |  |                            |       |                         
|Salaries and employee benefits                      |  |                            | 2,769 |                         
|Building, occupancy and equipment                   |  |                            | 457   |                         
|Other                                               |  |                            | 811   |                         
|Total non-interest expense                          |  |                            | 4,037 |                         
|                                                   
|                                                   
|Income (loss) before income tax expense             |  |                            | (37   | )                       
|Income tax expense                                  |  |                            | 41    |                         
|Net income (loss)                                   |  | $                          | (78   | )                       
|                                                   
|Basic earnings (loss) per share                     |  | $                          | (0.01 | )                       
|Diluted earnings (loss) per share                   |  | $                          | (0.01 | )                       

See accompanying notes to unaudited condensed consolidated financial statements.

3

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ROME BANCORP, INC. AND SUBSIDIARYCondensed Consolidated Statement of Shareholders'Equity and Comprehensive IncomeFor the Six Months Ended June 30, 2006 and 2005(in thousands, except share and per share data)(unaudited)

|                                                  |   |        |  |   |            |  |   |          |  |   |           |  |   | Accumulated   |  |   |             |  |   |              |  |   |         
|------------------------------------------------- | - | ------ |  | - | ---------- |  | - | -------- |  | - | --------- |  | - | ------------- |  | - | ----------- |  | - | ------------ |  | - | --------
|                                                  |   |        |  |   | Additional |  |   |          |  |   |           |  |   | other         |  |   | Unallocated |  |   |              |  |   |         
|                                                  |   | Common |  |   | paid-in    |  |   | Retained |  |   | Treasury  |  |   | comprehensive |  |   | ESOP        |  |   | Unearned     |  |   |         
|                                                  |   | stock  |  |   | Capital    |  |   | earnings |  |   | Stock     |  |   | income        |  |   | shares      |  |   | compensation |  |   | Total   
|Balances at January
        1, 2005               | $ | 33     |  | $ | 10,756     |  | $ | 34,627   |  | $ | $ (8,963) |  | $ | 391           |  | $ | (560)       |  | $ | (26)         |  | $ | 36,258  
|Comprehensive
        income:                     |   |        |  |   |            |  |   |          |  |   |           |  |   |               |  |   |             |  |   |              |  |   |         
|Net
        Income                                |   |        |  |   | -          |  |   | 1,609    |  |   | -         |  |   | -             |  |   | -           |  |   | -            |  |   | 1,609   
|Other
        comprehensive loss                  |   | -      |  |   | -          |  |   |          |  |   | -         |  |   | (195)         |  |   | -           |  |   | -            |  |   | (195)   
|Total
        comprehensive income                |   |        |  |   |            |  |   |          |  |   |           |  |   |               |  |   |             |  |   |              |  |   | 1,414   
|Proceeds of common
        stock offering and     |   |        |  |   |            |  |   |          |  |   |           |  |   |               |  |   |             |  |   |              |  |   |         
|conversion
        of existing shares, net of tax |   | 75     |  |   | 57,769     |  |   | -        |  |   |           |  |   | -             |  |   | (2,360)     |  |   | -            |  |   | 55,484  
|Retirement of
        1,747,266 treasury shares   |   | (12)   |  |   | (8,963)    |  |   | -        |  |   | 8,963     |  |   | -             |  |   | -           |  |   | -            |  |   | (12)    
|Amortization of
        unearned compensation     |   | -      |  |   | -          |  |   | -        |  |   | -         |  |   | -             |  |   | -           |  |   | 26           |  |   | 26      
|Dividends paid
        ($0.132 per share)         |   |        |  |   | -          |  |   | (834)    |  |   | -         |  |   | -             |  |   | -           |  |   | -            |  |   | (834)   
|Exercise of stock
        options                 |   | -      |  |   | 7          |  |   | -        |  |   | -         |  |   | -             |  |   | -           |  |   | -            |  |   | 7       
|Tax benefit of
        vested RRP shares          |   | -      |  |   | 73         |  |   | -        |  |   | -         |  |   | -             |  |   | -           |  |   | -            |  |   | 73      
|ESOP shares released
        for                  |   |        |  |   |            |  |   |          |  |   |           |  |   |               |  |   |             |  |   |              |  |   |         
|allocation
        (19,050 shares)                |   |        |  |   | 127        |  |   | -        |  |   | -         |  |   | -             |  |   | 71          |  |   | -            |  |   | 198     
|Balances at June
        30, 2005                 | $ | 96     |  | $ | 59,769     |  | $ | 35,402   |  | $ | -         |  | $ | 196           |  | $ | (2,849)     |  | $ | -            |  | $ | 92,614  
|(Restated  See
        Note 1)                   |   |        |  |   |            |  |   |          |  |   |           |  |   |               |  |   |             |  |   |              |  |   |         
|Balances at January
        1, 2006               | $ | 97     |  | $ | 60,013     |  | $ | 35,983   |  | $ | -         |  | $ | 85            |  | $ | (2,700)     |  | $ | -            |  | $ | 93,478  
|Comprehensive
        income:                     |   |        |  |   |            |  |   |          |  |   |           |  |   |               |  |   |             |  |   |              |  |   |         
|Net
        Income                                |   | -      |  |   | -          |  |   | 730      |  |   | -         |  |   | -             |  |   | -           |  |   | -            |  |   | 730     
|Other
        comprehensive loss                  |   | -      |  |   | -          |  |   | -        |  |   | -         |  |   | (47)          |  |   | -           |  |   | -            |  |   | (47)    
|Total
        comprehensive income                |   |        |  |   |            |  |   |          |  |   |           |  |   |               |  |   |             |  |   |              |  |   | 683     
|Purchases of 1,025,900
        treasury shares    |   | -      |  |   | -          |  |   | -        |  |   | (13,234)  |  |   | -             |  |   | -           |  |   | -            |  |   | (13,234)
|Transfer of treasury
        shares to RRP plan   |   | -      |  |   | (1,511)    |  |   | -        |  |   | 1,511     |  |   | -             |  |   | -           |  |   | -            |  |   | -       
|Amortization of
        unearned compensation     |   | -      |  |   | 1,489      |  |   | -        |  |   | -         |  |   | -             |  |   | -           |  |   | -            |  |   | 1,489   
|Dividends paid
        ($0.15 per share)          |   | -      |  |   | -          |  |   | (1,385)  |  |   | -         |  |   | -             |  |   | -           |  |   | -            |  |   | (1,385) 
|Exercise of stock
        options                 |   | -      |  |   | 186        |  |   | -        |  |   | -         |  |   | -             |  |   | -           |  |   | -            |  |   | 186     
|ESOP shares released
        for                  |   |        |  |   |            |  |   |          |  |   |           |  |   |               |  |   |             |  |   |              |  |   |         
|allocation
        (19,050 shares)                |   | -      |  |   | 167        |  |   | -        |  |   | -         |  |   | -             |  |   | 109         |  |   | -            |  |   | 276     
|Balances at June
        30, 2006                 | $ | 97     |  | $ | 60,344     |  | $ | 35,328   |  | $ | (11,723)  |  | $ | 38            |  | $ | (2,591)     |  | $ | -            |  | $ | 81,493  



See accompanying notes to unaudited condensed consolidated financial statements.

4

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ROME BANCORP, INC. AND SUBSIDIARYCondensed Consolidated Statements of Cash FlowsFor the Six Months Ended June 30, 2006 and 2005(unaudited) (in thousands)

|                                                     |  |   | 2006        |   |  |   | 2005    |  
|---------------------------------------------------- |  | - | ----------- | - |  | - | ------- | -
|Cash flows from operating activities:                |  |   | (Restated - |   |  |   |         |  
|                                                     |  |   | See Note 1) |   |  |   |         |  
|Net income                                           |  | $ | 730         |   |  | $ | 1,609   |  
|Adjustments to reconcile net income to net cash      |  |   |             |   |  |   |         |  
|Provided by operating activities:                    |  |   |             |   |  |   |         |  
|Depreciation and amortization                        |  |   | 268         |   |  |   | 250     |  
|Increase in accrued interest receivable              |  |   | 40          |   |  |   | 2       |  
|Net gain on securities sold                          |  |   | (11         | ) |  |   | (46     | )
|Provision for loan losses                            |  |   | 115         |   |  |   | -       |  
|Loss on disposal of fixed asset                      |  |   | 7           |   |  |   | -       |  
|Net accretion on securities                          |  |   | (6          | ) |  |   | (2      | )
|Proceeds from sales of loans                         |  |   | 543         |   |  |   | 293     |  
|Net gain on loans sold                               |  |   | (8          | ) |  |   | (5      | )
|Originations of loans held for sale                  |  |   | (535        | ) |  |   | (288    | )
|Increase (decrease) in other liabilities             |  |   | 238         |   |  |   | (26     | )
|(Increase) decrease in other assets                  |  |   | (707        | ) |  |   | 546     |  
|Allocation of ESOP shares                            |  |   | 276         |   |  |   | 198     |  
|Amortization of unearned compensation                |  |   | 1,489       |   |  |   | 26      |  
|Net cash provided by operating activities            |  |   | 2,439       |   |  |   | 2,557   |  
|                                                    
|Cash flows from investing activities:                |  |   |             |   |  |   |         |  
|Net increase in loans                                |  |   | (2,612      | ) |  |   | (12,608 | )
|Purchase of Bank owned life insurance                |  |   | (8,000      | ) |  |   | -       |  
|Proceeds from sales of securities available for sale |  |   | 365         |   |  |   | 679     |  
|Proceeds from maturities and principal reductions of |  |   |             |   |  |   |         |  
|securities available for sale                        |  |   | 4,087       |   |  |   | 2,912   |  
|Purchases of securities available for sale           |  |   | -           |   |  |   | (1      | )
|Purchases of Federal Home Loan Bank stock            |  |   | (37         | ) |  |   | (175    | )
|Proceeds from maturities and principal reductions of |  |   |             |   |  |   |         |  
|securities held to maturity                          |  |   | 232         |   |  |   | 27      |  
|Additions to premises and equipment                  |  |   | (709        | ) |  |   | (384    | )
|Net cash used in investing activities                |  |   | (6,674      | ) |  |   | (9,550  | )
|                                                    
|Cash flows from financing activities:                |  |   |             |   |  |   |         |  
|Increase (decrease) in time deposits                 |  |   | 2,790       |   |  |   | (1,740  | )
|Decrease in other deposits                           |  |   | (252        | ) |  |   | (2,484  | )
|Net proceeds of stock offering and conversion        |  |   | -           |   |  |   | 55,472  |  
|Repayments of borrowings                             |  |   | (497        | ) |  |   | (11,980 | )
|Additional borrowings                                |  |   | -           |   |  |   | 3,000   |  
|Purchase of treasury stock                           |  |   | (13,234     | ) |  |   | -       |  
|Dividends paid                                       |  |   | (1,385      | ) |  |   | (834    | )
|Exercise of stock options                            |  |   | 186         |   |  |   | 7       |  
|Net cash (used in) provided by financing activities  |  |   | (12,392     | ) |  |   | 41,441  |  
|                                                    
|Net (decrease) increase in cash and cash equivalents |  |   | (16,627     | ) |  |   | 34,448  |  
|Cash and cash equivalents at beginning of period     |  |   | 34,235      |   |  |   | 6,929   |  
|                                                    
|Cash and cash equivalents at end of period           |  | $ | 17,608      |   |  | $ | 41,377  |  

Condensed Consolidated Statements of Cash Flows continued on next page.

5

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ROME BANCORP, INC. AND SUBSIDIARYCondensed Consolidated Statements of Cash FlowsFor the Six Months Ended June 30, 2006 and 2005(unaudited) (in thousands)

|                                                  |  |  |  | 2006          |  | 2005 
|------------------------------------------------- |  |  |  | ------------- |  | -----
|                                                  |  |  |  | (Restated -   |  |      
|                                                  |  |  |  | See Note 1)   |  |      
|Supplemental disclosure of cash flow information: |  |  |  |               |  |      
|Non-cash investing activities:                    |  |  |  |               |  |      
|Transfer of loans to real estate owned            |  |  |  | $          54 |  | -    
|Cash paid during the period for:                  |  |  |  |               |  |      
|Interest                                          |  |  |  | 1,639         |  | 1,504
|Income taxes                                      |  |  |  | 925           |  | 900  

See accompanying notes to unaudited condensed consolidated financial statements.

6

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ROME BANCORP, INC.Notes to Unaudited Condensed Consolidated Financial Statements

(1) Restatement of Financial Statements

The Company has determined that in the second quarter of 2006, an error was made in recording the non-cash amortization expense related to grants made during that quarter under the Company's 2006 Stock Option Plan and Recognition
and Retention Plan. Under the provisions of Statement of Financial Accounting Standard ("FAS") No. 123(R), which the Company adopted in fiscal 2006, share-based grants that vest to awardees upon retirement, regardless of requisite service
requirements, should be fully expensed when retirement eligibility is attained. As part of its year end closing process, the Company determined that certain of the recipients of the awards made under these plans during the second quarter of 2006
were already eligible for retirement or early retirement under the Company's defined benefit pension plan and accordingly, their grants should have been expensed upon issuance rather than over the five year requisite service period. The Company's
previously issued consolidated condensed financial statements for the three and six months ended June 30, 2006 have been restated to reflect the accurate amortization of this stock-based compensation.

The following table summarizes the effect of the restatement adjustments on the financial statements as of and for the three and six months ended June 30, 2006.

|                                           |  | Three months ended June 30, 2006               
|------------------------------------------ |  | -----------------------------------------------
|                                           |  | (Previously Reported)                          
|                                           |  | (in thousands, except share and per share data)
|Salaries and employee benefits             |  | $                                              
|Total non-interest expense                 |  |                                                
|Income (loss) before income taxes          |  |                                                
|Income tax expense                         |  |                                                
|Net income (loss)                          |  |                                                
|Basic net income (loss) per share          |  | $                                              
|Diluted net income (loss) per share        |  | $                                              
|                                          
|                                          
|                                           |  | Six months ended June 30, 2006                 
|                                           |  | (Previously Reported)                          
|                                           |  |                                                
|Salaries and employee benefits             |  | $                                              
|Total non-interest expense                 |  |                                                
|Income (loss) before income taxes          |  |                                                
|Income tax expense                         |  |                                                
|Net income                                 |  |                                                
|Basic net income per share                 |  | $                                              
|Diluted net income per share               |  | $                                              
|                                          
|                                          
|                                           |  | As of June 30, 2006                            
|                                           |  | (Previously Reported)                          
|                                           |  | (in thousands, except share and per share data)
|Other assets                               |  | $                                              
|Total assets                               |  |                                                
|Additional paid in capital                 |  |                                                
|Retained earnings                          |  |                                                
|Total shareholders' equity                 |  |                                                
|Total liabilities and shareholders' equity |  |                                                

7

---



The adjustments to the balance sheet and income statement at and for the three and six months ended June 30, 2006 had no impact on total cash flows from operating, investing and financing activities. The restatement of the
consolidated financial statements also affected footnotes 4 and 8.

(2)           The accompanying unaudited condensed consolidated financial statements include the accounts of Rome Bancorp, Inc. ("Rome Bancorp" or the "Company") and The Rome Savings Bank (the "Bank"), a wholly-owned subsidiary of the
Company, as of June 30, 2006 and December 31, 2005 and for the three and six month periods ended June 30, 2006 and 2005. All inter-company accounts and transactions have been eliminated in consolidation. The accompanying unaudited condensed
consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not
include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.  The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. In the opinion of management, the unaudited condensed consolidated financial statements include all necessary
adjustments, consisting of normal recurring accruals, necessary for a fair presentation for the periods presented.

The Company believes that the disclosures are adequate to make the information presented not misleading; however, the results of operations and other data presented for the periods presented are not
necessarily indicative of results to be expected for the entire fiscal year.

The data in the condensed consolidated balance sheet for December 31, 2005 was derived from the Company's 2005 Annual Report on Form 10-K.
That data, along with the interim financial information presented in the condensed consolidated balance sheet, statements of income, statement of shareholders'equity and comprehensive
income and statements of cash flows should be read in conjunction with the 2005 consolidated financial statements, including the notes thereto included in the Company's Annual Report on Form 10-K.

Amounts in the prior period's consolidated financial statements are reclassified when necessary to conform with the current period's
presentation.

(3) Stock Offering and Conversion

Stock Offering and Conversion

On March 30, 2005, the second step conversion of Rome, MHC into a stock holding company structure and the related stock offering of this new stock holding company were completed. As a result of the second-step conversion, New
Rome Bancorp, Inc. became the holding company for the Bank and was immediately renamed "Rome Bancorp, Inc." Rome Bancorp issued 5,900,000 shares of common stock at a price of $10.00 per share in the related stock offering and exchanged 1,650,254
shares of common stock of the now predecessor Rome Bancorp, Inc. into 3,742,246 shares of common stock of the newly formed Rome Bancorp, Inc. pursuant to an exchange ratio of 2.26784, cashing out fractional shares. The reorganization was accounted
for as a change in corporate form with no resulting change in the historical basis of the Company's assets, liabilities and equity. Direct offering costs totaling $3.1 million were deducted from the proceeds of the shares sold in the
offering.As a result of the exchange and stock offering, as of March 30, 2005, the Company had 9,642,246 shares of common stock issued and outstanding. Net proceeds of $53.5 million
were raised in the stock offering, excluding $2.36 million which was loaned by the company to a trust for the Employee Stock Ownership Plan (ESOP) enabling it to purchase 236,000 shares of common stock in the stock offering for allocation under
such

8

---



plan. In addition, as part of the conversion and dissolution of Rome, MHC, the Bank received $1.9 million of cash previously held by Rome, MHC.

As a result of the second-step conversion, all share and per share amounts have been restated giving retroactive recognition to the second-step conversion ratio of 2.26784. Options granted under the Company's 2000 Stock Option
Plan and common shares held by the Company's ESOP and Recognition and Retention Plan prior to the conversion were also exchanged using the conversion ratio of 2.26784.

(4) Earnings Per Share

The following summarizes the computation of earnings per share for the three and six month periods ended June 30, 2006 and 2005.

|                                               |  | Three and six months ended                     
|---------------------------------------------- |  | -----------------------------------------------
|                                               |  | June 30                                        
|                                               |  | (in thousands, except share and per share data)
|                                              
|                                              
|                                               |  | Three months ended                             
|                                               |  | 2006                                           
|Basic earnings (loss) per share:               |  |                                                
|Income (loss) available to common shareholders |  | $                                              
|Weighted average basic shares outstanding      |  |                                                
|                                              
|Basic earnings (loss) per share                |  | $                                              
|                                              
|Diluted earnings (loss) per share:             |  |                                                
|Income (loss) available to common shareholders |  | $                                              
|Weighted average basic shares outstanding      |  |                                                
|Effect of dilutive securities:                 |  |                                                
|Stock options                                  |  |                                                
|Unearned compensation                          |  |                                                
|Weighted average diluted shares outstanding    |  |                                                
|                                              
|Diluted earnings (loss) per share              |  | $                                              

(5) Other Comprehensive Income (Loss)

|                                                        |  | Three months ended |    |      | Six months ended |    
|------------------------------------------------------- |  | ------------------ | -- | ---- | ---------------- | ---
|                                                        |  | June 30,           |    |      | June 30,         |    
|                                                       
|                                                        |  | 2006               |    | 2005 |                  |    
|Net change in unrealized gain (loss) on                 |  |                    |    |      |                  |    
|available-for-sale securities arising during the period |  | $                  | 52 |      | $                | (90
|Reclassification adjustment for net realized gain       |  |                    |    |      |                  |    
|included in net income                                  |  |                    | -  |      |                  | (17
|Other comprehensive gain (loss), before tax             |  |                    | 52 |      |                  | (73
|Deferred tax expense (benefit)                          |  |                    | 21 |      |                  | (29
|                                                       
|Other comprehensive gain (loss)                         |  | $                  | 31 |      | $                | (44

9

---



(6)      Securities

Securities are summarized as follows (in thousands):

|                                |  |   | June 30, 2006 |  | December 31, 2005
|------------------------------- |  | - | ------------- |  | -----------------
|                               
|                                |  |   | Amortized     |  |                  
|                                |  |   | Cost          |  |                  
|                               
|Available-for-sale:             |  |   |               |  |                  
|U.S. Government agencies        |  | $ | 577           |  | $                
|State and Municipal obligations |  |   | 2,480         |  |                  
|Mortgage-backed securities      |  |   |               |  |                  
|FHLMC                           |  |   | 400           |  |                  
|Corporate bonds                 |  |   | 502           |  |                  
|                               
|Total debt securities           |  |   | 3,959         |  |                  
|                               
|Equity and other securities     |  |   | 1,137         |  |                  
|                               
|Total available for sale        |  | $ | 5,096         |  | $                
|                               
|Held-to-maturity:               |  |   |               |  |                  
|U.S. Government securities      |  | $ | 1,002         |  | $                
|Mortgage-backed securities      |  |   |               |  |                  
|GNMA                            |  |   | 34            |  |                  
|FHLMC                           |  |   | 3             |  |                  
|Other bonds                     |  |   | 163           |  |                  
|                               
|Total held to maturity          |  | $ | 1,202         |  | $                
|                               
|FHLB Stock                      |  | $ | 813           |  | $                

FHLB stock is carried at cost since fair values are not readily determinable.

Securities pledged at both June 30, 2006 and December 31, 2005 had a carrying amount of $1.0 million and $1.1 million, respectively. These securities collateralize state and Treasury department programs. As of these
dates,there were noholdings of securities of any one issuer, other than the U.S. Government and its
agencies, in an amount greater than 10% of shareholders' equity.

10

---



(7)Loans

Loans are summarized as follows (in thousands):

|                         |  | June 30, |         | December 31,
|------------------------ |  | -------- | ------- | ------------
|                         |  | 2006     |         | 2005        
|Mortgage loans:          |  |          |         |             
|Residential (1-4 family) |  | $        | 129,723 |             
|Commercial               |  |          | 51,043  |             
|Construction and land    |  |          | 5,501   |             
|                        
|Total Mortgage loans     |  |          | 186,267 |             
|Other loans:             |  |          |         |             
|Commercial               |  |          | 23,030  |             
|Automobile loans         |  |          | 18,238  |             
|Property improvement     |  |          |         |             
|and equipment            |  |          | 15,339  |             
|Other consumer           |  |          | 13,549  |             
|                        
|Total Other loans        |  |          | 70,156  |             
|                        
|Total Loans              |  | $        | 256,423 |             

Changes in the allowance for loan losses are summarized as follows (in thousands):

|                                |  | Three months ended |       |   | Six months ended |  
|------------------------------- |  | ------------------ | ----- | - | ---------------- | -
|                                |  | June 30,           |       |   | June 30,         |  
|                                |  | 2006               |       |   | 2005             |  
|                               
|Balance at beginning of period  |  | $                  | 1,958 |   |                  | $
|Provision charged to operations |  |                    | -     |   |                  |  
|Loans charged off               |  |                    | (83   | ) |                  |  
|Recoveries                      |  |                    | 79    |   |                  |  
|                               
|Balance at end of period        |  | $                  | 1,954 |   |                  | $

The Company's recorded investment in loans that are considered impaired totaled $333,000 and $211,000 at June 30, 2006 and December 31, 2005, respectively. These impaired loans carried
allowances of $187,000 at June 30, 2006 and $127,000 as of year-end 2005. The average recorded investment in impaired loans was $358,000 and $255,000 in the first six months of 2006 and 2005, respectively. The Company recognized no
interest on impaired loans during the six month periods ended June 30, 2006 and 2005.

The principal balances of loans not accruing interest amounted to $1.0 million and $871,000 at June 30, 2006 and December 31, 2005, respectively.  Loans 90 days past due and accruing interest
amounted to

11

---



$72,000 and $75,000 at June 30, 2006 and December 31, 2005, respectively. The differences between the amount of interest income that would have been recorded if non-accrual loans had been paid in accordance with their
original terms and the amount of interest income that was recorded during the three months ended June 30, 2006 and 2005 was $48,800 and $41,100, respectively. There are no commitments to extend further credit on non-accruing loans.

A substantial portion of the Company's loans are mortgage and consumer loans in Oneida County. Accordingly, the ultimate collectibility of a substantial portion of the Company's loan portfolio is
susceptible to changes in market conditions in this area. A majority of the Company's loan portfolio is secured by real estate.  Other than general economic risks, management is not aware of any material concentrations of credit risk to any industry
or individualborrower.

(8) Stock-Based Compensation

Effective January 1, 2006, the Company adopted the fair value method of accounting for share-based compensation arrangements in accordance with Statement of Financial Accounting Standards No. 123 (revised 2004), Share-Based
Payment (FAS 123(R)), using the modified prospective method of transition. Under the provisions of FAS 123(R), the estimated fair value of share-based awards granted is recognized as compensation expense over the service period. Using the
modified prospective method, compensation expense is recognized beginning with the effective date of adoption of FAS 123(R) for all share-based payments (i) granted after the effective date of adoption and (ii) granted prior to the effective date of
adoption and that remain unvested on the date of adoption. The Company had no unvested stock options outstanding at the date of adoption.

Prior to January 1, 2006, the Company accounted for share-based employee compensation plans using the intrinsic value method of accounting in accordance with Accounting Principles Board Opinion No. 25, Accounting for Stock
Issued to Employees (APB 25), and its related interpretations. Under the provisions of APB 25, no compensation expense was recognized when stock options were granted with exercise prices equal to or greater than market value on the date of
grant.

Prior to the adoption of FAS 123(R), the Company presented all tax benefits resulting from share-based compensation as cash flows from operating activities in the condensed consolidated statements of cash flows. FAS 123(R)
requires cash flows resulting from tax deductions in excess of the grant-date fair value of share-based awards to be included in cash flows from financing activities. This tax benefit of $106,000 related to share-based compensation in the first
half of 2006 has been included in cash flows from financing activities.

Under the modified prospective method of transition, the Company is not required to restate its prior period financial statements to reflect disclosures of its net income and earnings per share for the prior year period. The
following table illustrates the effect on net income and earnings per share if the Company had applied the fair value recognition provisions of FAS 123 to stock-based employee compensation for the three and six months ended June 30, 2005:

12

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|                                                      | Three and six months ended                |             
|----------------------------------------------------- | ----------------------------------------- | ------------
|                                                      | June 30, 2005                             |             
|                                                      | (in thousands, except per
    share data) |             
|                                                     
|Net income:                                           |                                           | Three Months
|As reported                                           |                                           | $           
|Add: Stock based compensation expense included in net |                                           |             
|income, net of related tax expense                    |                                           |             
|Deduct: Total stock based compensation expense        |                                           |             
|determined under fair value method, net of related    |                                           |             
|tax expense                                           |                                           |             
|Pro forma                                             |                                           | $           
|                                                     
|                                                     
|Basic earnings per share:                             |                                           |             
|As reported                                           |                                           | $           
|Pro forma                                             |                                           | $           
|                                                     
|Diluted earnings per share:                           |                                           |             
|As reported                                           |                                           | $           
|Pro forma                                             |                                           | $           

On May 24, 2006, the Company's Board of Directors issued 354,000 stock options to directors and key employees with an exercise price equal to the market price of the Company's stock on that day. These options have a ten year life
and vest ratably over a five year period, or immediately upon a recipients death, disability or retirement. The fair value of the options granted is estimated at grant date using a Black-Scholes option pricing model based upon the following
assumptions: expected dividend yield 2.52%, expected stock price volatility 8.247%, risk free interest rate 4.599% and an expected option life of 6.5 years. At date of grant, certain of the recipients were eligible for retirement or early retirement
under the Company's defined benefit plan and accordingly, their option grants were immediately expensed, resulting in $ 350,000 of amortization being recorded in the second quarter of 2006. As of June 30, 2006, unrecognized compensation cost
related to the remaining options was $245,000. This expense is being amortized on a straight line basis over the sixty month vesting period of the options.

Following is a summary of the Company's 2006 year to date stock option activity:

|                                         |  | Six Months ended June 30, 2006
|---------------------------------------- |  | ------------------------------
|                                         |  | (Dollars in thousands)        
|                                         |  |                               
|                                         |  |                               
|                                         |  | Shares                        
|Options outstanding, beginning of period |  | 219,798                       
|Exercised                                |  | (36,892                       
|Granted                                  |  | 354,000                       
|Options outstanding at end of period     |  | 536,906                       
|Options exercisable at end of period     |  | 182,906                       

The aggregate intrinsic value of all options outstanding and exercisable at June 30, 2006 was $1,975,000. The intrinsic value of options exercised during the quarter and six months ended June 30, 2006 was $241,000 and
$359,000, respectively.

On May 24, 2006, the Company's Board of Directors awarded 168,300 shares of restricted stock to directors and certain key employees. These shares vest to the recipients ratably over a five year period, or immediately upon a
recipient's death, disability or retirement. The grants awarded to individuals who

13

---



|     | were eligible for retirement or early retirement under the Company's defined benefit plan were expensed upon award, resulting in second quarter 2006 amortization expense related to this plan of $1.1 million.
At June 30, 2006, the unrecognized compensation cost attributable to the remaining restricted stock awards was $1.0 million, which will be expensed over the vesting period. The aggregate intrinsic value of restricted stock that is expected to
vest in the future was $2.2 million at June 30, 2006.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    
|     | Compensation cost for the Company's stock option and restricted stock plans in the 2006 and 2005 second quarters was $1.5 million and $13,000, respectively. For the six months ended June 30, 2006 and
2005 compensation cost related to these plans was $1.5 million and $26,000, respectively.                                                                                                                                                                                                                       
|    
|(10) | Pension and Postretirement Medical Benefit Expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    
|     | The components of net periodic pension and postretirement benefit cost consisted of the following:                                                                                                                                                                                                                                                                                                                                                                                                                      
|    

|                                         |  | Three months ended June 30,
|---------------------------------------- |  | ---------------------------
|                                         |  | (in thousands)             
|                                         |  | Pension benefits           
|                                         |  |                            
|Components of net periodic pension cost: |  | 2006                       
|Service cost                             |  | $                          
|Interest cost                            |  |                            
|Expected return on plan assets           |  |                            
|Curtailment charge                       |  |                            
|Amortization                             |  |                            
|                                        
|Net periodic pension cost                |  | $                          
|                                        
|                                         |  | Six months ended June 30,  
|                                         |  | (in thousands)             
|                                         |  | Pension benefits           
|                                         |  |                            
|Components of net periodic pension cost: |  | 2006                       
|Service cost                             |  | $                          
|Interest cost                            |  |                            
|Expected return on plan assets           |  |                            
|Curtailment charge                       |  |                            
|Amortization                             |  |                            
|                                        
|Net periodic pension cost                |  | $                          

In December of 2002, the Company's Board of Directors amended the defined benefit pension plan to cease the accrual of further benefits. For the fiscal year ended December 31, 2006, the Company expects to make no contributions to
the defined benefit pension plan.

14

---



(11)New Accounting Pronouncements

In July 2006, the FASB released Interpretation
      No. 48, "Accounting for Uncertainty in Income Taxes." This Interpretation
      revises the recognition tests for tax positions taken in tax returns such
      that a tax benefit is recorded only when it is more likely than not that
      the tax position will be allowed upon examination by taxing authorities.
      The amount of such a tax benefit to record is the largest amount that is
      more likely than not to be allowed. Any reduction in deferred tax assets
      or increase in tax liabilities upon adoption will correspondingly reduce
      retained earnings. The Company has not yet determined the effect of adopting
      this Interpretation, which is effective for it on January 1, 2007. Item 2. Management's
        Discussion and Analysis of Financial Condition and Results of Operations


Forward-Looking Statements

Statements included in this discussion and in future filings by Rome Bancorp, Inc. ("Rome Bancorp" or the "Company") with the Securities and Exchange Commission, in Rome Bancorp press releases, and in oral statements made with the
approval of an authorized executive officer, which are not historical or current facts, are "forward-looking statements" made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, and are subject to certain
risks and uncertainties that could cause actual results to differ materially from historical earnings and those presently anticipated or projected. Rome Bancorp wishes to caution readers not to place undue reliance on such forward-looking
statements, which speak only as of the date made. The following important factors, among others, in some cases have affected and in the future could affect Rome Bancorp actual results, and could cause Rome Bancorp, Inc. actual financial performance
to differ materially from that expressed in any forward-looking statement: (1) changes in the real estate market or local economy, (2) changes in interest rates, (3) changes in laws and regulations to which we are subject, and (4) competition in our
primary market area. Rome Bancorp disclaims any obligation to subsequently revise any forward-looking statements to reflect events or circumstances after the date of such statements, or to reflect the occurrence of anticipated or unanticipated
events.

General

The Company is a Delaware corporation regulated by the Office of Thrift Supervision ("OTS") as a savings and loan holding company, whose sole business is conducted by its wholly owned subsidiary, the Rome Savings Bank (the
"Bank.") The Bank's principal business is accepting deposits from the general public and using those deposits to make residential and commercial real estate loans, as well as commercial and consumer loans to individuals and small businesses
primarily in Oneida County and also elsewhere in New York State. The Bank also invests in long and short-term marketable securities and other liquid investments. Following its conversion to a federal charter on April 27, 2004, the Bank has been
regulated by the OTS as a federal savings bank.

Overview

The Bank's results of operations depend primarily on its net interest income, which is the difference between the interest income it earns on its loans and investments and the interest it pays on its deposits and other
interest-bearing liabilities. Net interest income is affected by the relative amounts of interest-bearing assets and interest-bearing liabilities and the interest rates earned or paid on these balances. The Bank's operations are also affected by
non-interest income, such as service fees and gains and losses on sales of securities, the provision for loan losses and non-interest expense such as salaries and employee benefits, occupancy costs, and other general and administrative expenses.
Financial institutions in general, including the Bank, are significantly affected by economic conditions, competition and the monetary and fiscal policies of the federal government. Lending activities are influenced by the demand for and supply of
housing, competition among lenders, interest rate conditions and funds availability. The Bank's operations and lending are principally concentrated in the

15

---



Central New York area, therefore its operations and earnings are influenced by the economics of the area it operates in. Deposit balances and cost of funds are influenced by prevailing market rates on competing investments,
customer preferences and levels of personal income and savings in the Bank's primary market area.

Net income for the second quarter of 2006 was a loss of $78,000, compared to the prior year's second quarter net income of $970,000. The significant factors and trends impacting the second quarter of 2006, which are
discussed in greater depth below, were as follows:

- Net interest income increased by $155,000 or 4.6% from the same quarter last year as a result of an increase in the yield on earning assets, partially offset by an increase in
deposit interest expense. The Company's net interest margin increased from 4.64% in the second quarter of 2005 to 5.02% in the same quarter of 2006.
- Non-interest income decreased by $116,000 from second quarter 2005 levels primarily due to a non- recurring settlement received in June of 2005 and a decrease in securities gains,
partially offset by increased fee revenue.
- Non-interest expense increased to $4.0 million in the second quarter of 2006 from $2.4 million in the same quarter of the prior year, primarily due to amortization expense
related to stock-based compensation as accounted for under FAS No. 123(R).

Critical Accounting Policies

The preparation of consolidated financial statements requires management to make estimates and assumptions. Changes in these estimates and assumptions affect the reported amounts of certain assets, liabilities, revenue and
expenses. Different amounts could be reported under different conditions, or if different assumptions were used in the application of these accounting policies.

It is management's opinion that accounting estimates covering certain aspects of the business have more significance than others due to the relative importance of those areas to overall performance, or the level of subjectivity
required in making these estimates. Management of the Company considers the accounting policy relating to the allowance for loan losses to be a critical accounting policy given the uncertainty in evaluating the level of the allowance required for
probable credit losses and the material effect that such judgments can have on the results of operations. Management's quarterly evaluation of the adequacy of the allowance considers the Company's historical loan loss experience, review of specific
loans, current economic conditions and such other factors considered appropriate to estimate losses. Management uses presently available information to estimate probable losses on loans; however, future additions to the allowance may be necessary
based on changes in estimates, assumptions or economic conditions. Significant factors that could give rise to changes in these estimates include, but are not limited to, changes in economic conditions in the local area, concentrations of risk and
declines of local property values.

The Company's critical policies and their application are reviewed periodically by the Audit Committee and the Board of Directors. All accounting policies are important, and as such, we encourage the reader to review each of the
policies included in Note 2 to the consolidated financial statements reported on the Company's 2005 Form 10-K to obtain a better understanding of how our financial performance is reported.

16

---



Analysis of Net Interest Income.Average Balances, Interest and Average Yields- The following table sets forth certain information relating to the Company's average balance sheets and reflects the average yield on
interest-earnings assets and average cost of interest-bearing liabilities, interest earned and interest paid for the periods indicated. Such yields and costs are derived by dividing income or expense by the average balance of interest-earning assets
or interest-bearing liabilities, respectively, for the periods presented. Average balances are derived from daily balances over the periods indicated. The average balances for loans are net of allowance for loan losses, but include non-accrual
loans. Interest income on securities includes a tax equivalent adjustment for bank qualified municipals.

|                                           |  |                                          |         |         |                                          |       |        |         | Average Balances, Interest and Average Yields |         |  |         |        
|------------------------------------------ |  | ---------------------------------------- | ------- | ------- | ---------------------------------------- | ----- | ------ | ------- | --------------------------------------------- | ------- |  | ------- | -------
|                                           |  | For the three months ended June 30, 2006 |         |         | For the three months ended June 30, 2005 |      
|                                           |  |                                          |         |         | Interest                                 |       |        | Average |                                               |         |  |         |        
|                                           |  | Average                                  |         | Income/ |                                          |       | Yield/ |         |                                               | Average |  | Income/ |        
|                                           |  | Balance                                  |         | Expense |                                          |       | Cost   |         |                                               | Balance |  | Expense |        
|Assets:                                    |  | (Dollars in thousands)                  
|Interest-earning assets:                   |  |                                          |         |         |                                          |       |        |         |                                               |         |  |         |        
|Loans                                      |  | $                                        | 252,772 |         | $                                        | 4,011 |        |         | 6.37                                          | %       |  | $       | 238,903
|Securities (1)                             |  |                                          | 8,305   |         |                                          | 120   |        |         | 5.82                                          |         |  |         | 16,295 
|Federal funds sold & other                 |  |                                          |         |         |                                          |       |        |         |                                               |         |  |         |        
|Interest bearing deposits                  |  |                                          | 22,795  |         |                                          | 276   |        |         | 4.85                                          |         |  |         | 40,559 
|Total interest-earnings assets             |  |                                          | 283,872 |         |                                          | 4,407 |        |         | 6.23                                          |         |  |         | 295,757
|Noninterest-earning assets                 |  |                                          | 20,048  |         |                                          |       |        |         |                                               |         |  |         | 16,351 
|Total assets                               |  | $                                        | 303,920 |         |                                          |       |        |         |                                               |         |  | $       | 312,108
|Liabilities and Shareholders' Equity:      |  |                                          |         |         |                                          |       |        |         |                                               |         |  |         |        
|Interest-bearing liabilities:              |  |                                          |         |         |                                          |       |        |         |                                               |         |  |         |        
|Savings accounts                           |  | $                                        | 88,947  |         | $                                        | 166   |        |         | 0.75                                          |         |  | $       | 94,872 
|Time deposits                              |  |                                          | 68,605  |         |                                          | 569   |        |         | 3.32                                          |         |  |         | 67,385 
|Money market accounts                      |  |                                          | 4,934   |         |                                          | 22    |        |         | 1.81                                          |         |  |         | 5,814  
|Other interest bearing deposits            |  |                                          | 11,371  |         |                                          | 17    |        |         | 0.60                                          |         |  |         | 9,770  
|Total interest-bearing deposits            |  |                                          | 173,857 |         |                                          | 774   |        |         | 1.79                                          |         |  |         | 177,841
|Borrowings                                 |  |                                          | 8,965   |         |                                          | 79    |        |         | 3.51                                          |         |  |         | 9,949  
|Total interest-bearing liabilities         |  |                                          | 182,822 |         |                                          | 853   |        |         | 1.87                                          |         |  |         | 187,790
|Noninterest-bearing deposits               |  |                                          | 28,258  |         |                                          |       |        |         |                                               |         |  |         | 27,618 
|Other liabilities                          |  |                                          | 4,561   |         |                                          |       |        |         |                                               |         |  |         | 4,169  
|Total liabilities                          |  |                                          | 215,641 |         |                                          |       |        |         |                                               |         |  |         | 219,577
|Shareholders' equity                       |  |                                          | 88,279  |         |                                          |       |        |         |                                               |         |  |         | 92,531 
|Total liabilities and shareholders' equity |  | $                                        | 303,920 |         |                                          |       |        |         |                                               |         |  | $       | 312,108
|Net interest income                        |  |                                          |         |         |                                          | 3,554 |        |         |                                               |         |  |         |        
|Tax equivalent adjustment on securities    |  |                                          |         |         |                                          | (20   | )      |         |                                               |         |  |         |        
|Net interest income per consolidated       |  |                                          |         |         |                                          |       |        |         |                                               |         |  |         |        
|financial statements                       |  |                                          |         |         | $                                        | 3,534 |        |         |                                               |         |  |         |        
|                                          
|Net interest rate spread                   |  |                                          |         |         |                                          |       |        |         | 4.36                                          | %       |  |         |        
|Net interest margin                        |  |                                          |         |         |                                          |       |        |         | 5.02                                          | %       |  |         |        
|Ratio of interest-earning assets to        |  |                                          |         |         |                                          |       |        |         |                                               |         |  |         |        
|interest-bearing liabilities               |  |                                          |         |         |                                          |       |        |         | 1.55                                          | x       |  |         |        

(1) Includes tax equivalent adjustment for the Company's tax-exempt municipal securities.

17

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|                                           |  |                                        |         |                                        |          |       |        |         | Average Balances, Interest and Average Yields |         |  |         |        
|------------------------------------------ |  | -------------------------------------- | ------- | -------------------------------------- | -------- | ----- | ------ | ------- | --------------------------------------------- | ------- |  | ------- | -------
|                                           |  | For the six months ended June 30, 2006 |         | For the six months ended June 30, 2005
|                                           |  |                                        |         |                                        | Interest |       |        | Average |                                               |         |  |         |        
|                                           |  | Average                                |         | Income/                                |          |       | Yield/ |         |                                               | Average |  | Income/ |        
|                                           |  | Balance                                |         | Expense                                |          |       | Cost   |         |                                               | Balance |  | Expense |        
|Assets:                                    |  | (Dollars in thousands)                
|Interest-earning assets:                   |  |                                        |         |                                        |          |       |        |         |                                               |         |  |         |        
|Loans                                      |  | $                                      | 252,539 |                                        | $        | 7,988 |        |         | 6.38                                          | %       |  | $       | 236,264
|Securities (1)                             |  |                                        | 9,968   |                                        |          | 276   |        |         | 5.58                                          |         |  |         | 17,063 
|Federal funds sold & other                 |  |                                        |         |                                        |          |       |        |         |                                               |         |  |         |        
|Interest bearing deposits                  |  |                                        | 25,453  |                                        |          | 576   |        |         | 4.56                                          |         |  |         | 23,002 
|Total interest-earnings assets             |  |                                        | 287,960 |                                        |          | 8,840 |        |         | 6.19                                          |         |  |         | 276,329
|Noninterest-earning assets                 |  |                                        | 18,349  |                                        |          |       |        |         |                                               |         |  |         | 17,030 
|Total assets                               |  | $                                      | 306,309 |                                        |          |       |        |         |                                               |         |  | $       | 293,359
|Liabilities and Shareholders' Equity:      |  |                                        |         |                                        |          |       |        |         |                                               |         |  |         |        
|Interest-bearing liabilities:              |  |                                        |         |                                        |          |       |        |         |                                               |         |  |         |        
|Savings accounts                           |  | $                                      | 89,358  |                                        | $        | 333   |        |         | 0.75                                          |         |  | $       | 98,557 
|Time deposits                              |  |                                        | 67,501  |                                        |          | 1,076 |        |         | 3.22                                          |         |  |         | 67,947 
|Money market accounts                      |  |                                        | 5,154   |                                        |          | 36    |        |         | 1.40                                          |         |  |         | 6,795  
|Other interest bearing deposits            |  |                                        | 11,310  |                                        |          | 34    |        |         | 0.60                                          |         |  |         | 9,571  
|Total interest-bearing deposits            |  |                                        | 173,323 |                                        |          | 1,479 |        |         | 1.72                                          |         |  |         | 182,870
|Borrowings                                 |  |                                        | 9,089   |                                        |          | 159   |        |         | 3.53                                          |         |  |         | 13,836 
|Total interest-bearing liabilities         |  |                                        | 182,412 |                                        |          | 1,638 |        |         | 1.81                                          |         |  |         | 196,706
|Noninterest-bearing deposits               |  |                                        | 28,041  |                                        |          |       |        |         |                                               |         |  |         | 27,406 
|Other liabilities                          |  |                                        | 4,898   |                                        |          |       |        |         |                                               |         |  |         | 4,238  
|Total liabilities                          |  |                                        | 215,351 |                                        |          |       |        |         |                                               |         |  |         | 228,350
|Shareholders' equity                       |  |                                        | 90,958  |                                        |          |       |        |         |                                               |         |  |         | 65,009 
|Total liabilities and shareholders' equity |  | $                                      | 306,309 |                                        |          |       |        |         |                                               |         |  | $       | 293,359
|Net interest income                        |  |                                        |         |                                        |          | 7,202 |        |         |                                               |         |  |         |        
|Tax equivalent adjustment on securities    |  |                                        |         |                                        |          | (46   | )      |         |                                               |         |  |         |        
|Net interest income per consolidated       |  |                                        |         |                                        |          |       |        |         |                                               |         |  |         |        
|financial statements                       |  |                                        |         |                                        | $        | 7,156 |        |         |                                               |         |  |         |        
|                                          
|Net interest rate spread                   |  |                                        |         |                                        |          |       |        |         | 4.38                                          | %       |  |         |        
|Net interest margin                        |  |                                        |         |                                        |          |       |        |         | 5.04                                          | %       |  |         |        
|Ratio of interest-earning assets to        |  |                                        |         |                                        |          |       |        |         |                                               |         |  |         |        
|interest-bearing liabilities               |  |                                        |         |                                        |          |       |        |         | 1.58                                          | x       |  |         |        

(1) Includes tax equivalent adjustment for the Company's tax-exempt municipal securities.

18

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Rate Volume Analysis The following table analyzes the dollar amount of changes in interest income and interest expense for major components of interest-earning assets and interest-bearing
liabilities. It shows the amount of the change in interest income or expense caused by either changes in outstanding balances (volume) or changes in interest rates. The effect of a change in volume is measured by applying the average rate during the
first period to the volume change between the two periods. The effect of changes in rate is measured by applying the change in rate between the two periods to the average volume during the first period. Changes attributable to both rate and volume,
which cannot be segregated, have been allocated proportionately to the absolute value of the change due to volume and the change due to rate.

|                                                                                          |  | Rate Volume Analysis                         |                
|----------------------------------------------------------------------------------------- |  | -------------------------------------------- | ---------------
|                                                                                          |  | Three months ended June 30, 2006             |                
|                                                                                          |  | Compared to Three months ended June 30, 2005 |                
|                                                                                         
|                                                                                          |  | Increases (decreases) due to                 |                
|                                                                                          |  | Rate                                         |                
|                                                                                          |  |                                              | ( in thousands)
|Assets:                                                                                   |  |                                              |                
|Interest-earning assets:                                                                  |  |                                              |                
|Loans                                                                                     |  | $                                            | 144            
|Securities (1)                                                                            |  |                                              | 16             
|Federal funds sold & other                                                                |  |                                              |                
|Interest bearing deposits                                                                 |  |                                              | 118            
|Total interest-earnings assets                                                            |  |                                              | 278            
|                                                                                         
|Interest-bearing liabilities:                                                             |  |                                              |                
|Savings accounts                                                                          |  |                                              | -              
|Time deposits                                                                             |  |                                              | 120            
|Money market accounts                                                                     |  |                                              | 14             
|Other interest bearing deposits                                                           |  |                                              | 3              
|Total interest-bearing deposits                                                           |  |                                              | 137            
|Borrowings                                                                                |  |                                              | -              
|Total interest-bearing liabilities                                                        |  |                                              | 137            
|                                                                                         
|Net change in interest income (1)                                                         |  | $                                            | 141            
|(1) Includes tax equivalent adjustment for the Company's tax-exempt municipal securities. |  |                                              |                

Comparison of Financial Condition at June 30, 2006 and December 31, 2005:

Total assets at June 30, 2006 were $299.1 million, a decrease of $9.7 million from $308.9 million at December 31, 2005. Cash and federal funds decreased by $16.6 million in the first six months of 2006 from
$34.2 million at December 31, 2005 to $17.6 million at June 30, 2006 due to investments in treasury stock and bank owned life insurance. Securities decreased by $4.7 million from $11.9 million to $7.2 million over the same
period. The decrease in securities was attributable to the sale of shares in an equity mutual fund, as well as maturities in the investment portfolio.

The Company's loan portfolio increased by $2.5 million, or 1.0%, during the first half of 2006 from $253.9 million at December 31, 2005 to $256.4 million at June 30, 2006. During the first
half of 2006, the Company originated approximately $22.3 million of loans, as compared to approximately $30.4 million of loans originated in the same period of 2005. The majority of the loan originations this year to date has been in the
mortgage area. Non-performing loans as a percentage of total loans increased to 0.42% at June 30, 2006, as compared to 0.37% at December 31, 2005. The allowance for loan losses as a percentage of total loans was 0.76% and 0.77% at June 30, 2006 and
December 31, 2005, respectively. In addition, the allowance for loan losses as a percent of non-performing loans was 181.4% at June 30, 2006, compared to 207.0% at December 31, 2005.

19

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Total deposits increased to $204.0 million at June 30, 2006 from $201.5 million at December 31, 2005. During the first half of 2006, balances of time deposits and other interest bearing
deposits increased by $2.8 million, or 4.2%, and $942,000, or 8.5%, respectively. Money market accounts also increased over the same period by $209,000, or 4.2% . Savings deposits and non-interest bearing deposits decreased by $1.0
million or 1.1%, and $334,000, or 1.1% respectively, during the first half of 2006.

In June of 2006, the Company invested in bank owned life insurance covering certain key employees. This $8.0 million investment is classified as an other asset, and is the reason for the increase in these assets from $5.3
million at December 31, 2005 to $13.4 million at June 30, 2006.

Comparison of Operating Results for the Three-Month Periods Ended June 30, 2006 and 2005

General

During the three months ended June 30, 2006, the Company recorded a loss of $78,000 compared to income of $970,000 for the second quarter of 2005. The decrease in net income is comprised of a decrease in non-interest
income of $116,000 and an increase in non-interest expense of $1.6 million, which were partially offset by a $155,000 increase in net interest income before loan loss provision and a $543,000 decrease in income tax
expense.

Diluted earnings (losses) per share were $(0.01) and $0.10 per diluted share for the three month period ended June 30, 2006 and 2005. Average diluted shares decreased to 8,905,956 for the
second quarter of 2006 from 9,551,582 in the same period of 2005 due to the Company's stock buyback program.

Net Interest Income

Net interest income before loan loss provision for the quarter ended June 30, 2006 increased by $155,000 or 4.6% as compared to the same quarter of 2005. This increase is attributable to
higher yields earned on the Company's portfolio of earning assets partially offset by increased interest expense on deposit accounts.

Interest Income

Interest income increased to $4.4 million for the quarter ended June 30, 2006 from $4.1 million for the same quarter of 2005. Average loan balances for the second quarter of 2006 were
$252.8 million, an increase of $13.9 million over the average outstanding loans for the second quarter of 2005. The yield on the Company's loan portfolio for the quarter ended June 30, 2006 was 6.37% in comparison to a yield of 6.14% for the
same period last year. Interest income on securities declined $67,000 from $167,000 for the quarter ended June 30, 2005 to $100,000 for the quarter ended June 30, 2006. Comparatively, the average balance of securities declined by
$8.0 million, or 49.0% from the second quarter of 2005 to $8.3 million for the current quarter and the yield on the Company's securities increased from 5.06% to 5.82% for the same periods, respectively. Finally, interest income on federal
funds sold and other interest bearing deposits decreased by $5,000 to $276,000 for the quarter ended June 30, 2006 from the same quarter in 2005. Average balances of federal funds sold decreased by $17.8 million, to $22.8 million at
June 30, 2006 from $40.6 million at June 30, 2005, as the Company has continued to invest the proceeds of its March 30, 2005 stock offering.

Interest Expense

Interest expense increased to $853,000 in the quarter ended June 30, 2006 from $727,000 for the same quarter of 2005. Interest expense on deposits increased to $774,000 for the quarter
ended June 30, 2006 from $640,000 for the quarter ended June 30, 2005, due to rising rates paid on time deposits consistent with current market rates. Interest expense on borrowed funds decreased to $79,000 for the quarter ended June 30,
2006 from $87,000 for the comparative quarter of 2005 primarily due to a decrease in the average balance of borrowings to $9.0 million in the current quarter as compared to $9.9 million in the second quarter of 2005.

20

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Provision for Loan Losses

The Company recorded no provision for loan losses in either the second quarter of 2006 or 2005. Asset quality was slightly less favorable at June 30, 2006 than at December 31, 2005 with non-performing loans as a percent of loans
of 0.42% and the allowance for loan losses as a percent of non-performing loans of 181.4% at June 30, 2006, as compared to 0.37% and 207.0%, respectively, at December 31, 2005. The allowance for loan losses as a percentage of loans has remained
consistent at 0.76% at June 30, 2006 and 0.77% at December 31, 2005. During the current quarter, the Company had a minimal level of loan charge-off activity, leaving the allowance at an appropriate level without the need for an additional provision.
In the quarter ended June 30, 2005, the Company recorded net recoveries of $274,000, primarily due to the receipt of a large recovery on a commercial loan that had been charged off in 2000.

In determining the appropriate provision for loan losses, management considers the level of and trend in non-performing loans, the level of and trend in net loan charge-offs, the dollar amount and mix
of the loan portfolio, as well as general economic conditions and real estate trends in the Company's market area, which can impact the inherent risk of loss in the Company's loan portfolio.

Non-Interest Income and Non-Interest Expense

Non-interest income decreased by $116,000 to $466,000 in the second quarter of 2006 from $582,000 in the same period of 2005. This decrease is primarily attributable to the 2005
reimbursement of prior year legal fees expended in relation to the above referenced loan loss recovery totaling $167,000. In addition, in 2005, the Company recorded second quarter gains on securities sales totaling $17,000, while no
securities were sold in the quarter ended June 20, 2006. Partially offsetting these decreases was an increase in customer fee revenue over the level earned in the same quarter of 2005 and earnings on recently acquired bank owned life insurance in
the amount of $33,000.

Non-interest expense increased by $1.6 million to $4.0 million in the current quarter compared to $2.4 million in the same period of 2005, primarily due to increased stock-based
compensation amortization and expenditures related to compliance with Section 404 of the Sarbanes Oxley Act and strategic planning initiatives. In the second quarter of 2006, the Company granted stock options and restricted stock awards which are
being accounted for using the fair value methodology of SFAS No. 123(R). Total non-cash amortization expense related to these plans was $1.5 million in the quarter ended June 30, 2006, the majority of which was immediate expensing of options and
stock grants made to individuals eligible for retirement under the provisions of the Company's defined benefit plan.

Income tax expense for the second quarter of 2006 decreased to $41,000 from $584,000 in the same period of 2005, directly due to the decrease in pre-tax income.

Comparison of Operating Results for the Six-Month Periods Ended June 30, 2006 and 2005

General

During the six months ended June 30, 2006, the Company recorded net income of $730,000 compared to $1.6 million for the first half of 2005. The decrease in net income is comprised of increases in loan loss provision of
$115,000, non-interest expense of $1.8 million and a decrease of $162,000 in non-interest income, partially offset by a $775,000 increase in net interest income before loan loss provision and a $409,000 decrease in income tax
expense,

Diluted earnings per share were $0.08 per diluted share for the six months ended June 30, 2006 in comparison to $0.17 per diluted share for the same period of 2005.  The decrease in earnings
per share is

21

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directly attributed to the above referenced decrease in year to date net income, partially offset by a decrease in average outstanding diluted shares from 9,561,005 to 9,149,750.

Net Interest Income

Net interest income before loan loss provision for the six months ended June 30, 2006 increased by $775,000, or 12.1%, as compared to the same period of 2005. This increase is attributable to
growth in the Company's portfolio of earning assets and net interest margin.

Interest Income

Interest income increased to $8.8 million for the six months ended June 30, 2006 from $7.9 million for the same period of 2005.  The increase in interest income was attributable to the growth
in the Company's average earning assets to $288 million for the first half of 2006 from $276 million for the same period of the prior year, and an increase in overall yields to 6.19% from 5.76% over the same period. Average loan balances for
the first six months of 2006 were $252.5 million, an increase of $16.2 million over the average outstanding loans for the same period of 2005. The yield on the Company's loan portfolio for the six months ended June 30, 2006 was 6.38%
compared to a yield of 6.12% for the same period last year, reflecting current market trends. Interest income on securities declined $111,000 from $341,000 for the six months ended June 30, 2005 to $230,000 for the six months ended June
30, 2006. Comparatively, the average balance of securities declined by $7.1 million, or 41.5%, from the first half of 2005 to $10.0 million for the current year to date and the yield on the Company's securities increased from 4.93% to 5.58%
for the same periods, respectively. Finally, interest income on federal funds sold and other interest bearing deposits increased by $269,000 to $576,000 for the first half of 2006 from the same period in 2005 due to increased yields and to a
lesser extent, increased average balances.

Interest Expense

Interest expense increased to $1.6 million for the first half of 2006 from $1.5 million for the six months ended June 30, 2005. Interest expense on deposits increased to $1.5 million for
the half ended June 30, 2006 from $1.3 million for the six months ended June 30, 2005, due to rising rates paid on time deposits consistent with current market rates. Interest expense on borrowed funds decreased to $159,000 for the six
months ended June 30, 2006 from $225,000 for the comparative period of 2005 primarily due to a decrease in the average balance of borrowings to $9.1 million in the current half as compared to $13.8 million in the six months ended 2005.

Provision for Loan Losses

The Company recorded a provision for loan losses of $115,000 in the first half of 2006 as compared to no provision for loan losses in the first half of 2005. Asset quality was slightly less favorable at June 30, 2006, than at
year end 2005 with non-performing loans as a percent of loans of 0.42% and the allowance for loan losses as a percent of non-performing loans of 181.4% at June 30, 2006, compared to 0.37% and 207.0%, respectively at December 31, 2005. The allowance
for loan losses as a percentage of loans has remained consistent at 0.76% at June 30, 2006 and 0.77% at the prior year end. In the quarter ended June 30, 2005, the Company recorded net recoveries of $274,000, primarily due to the receipt of a
large recovery on a commercial loan that had been charged off in 2000. Receipt of this recovery prevented the need to record a loan loss provision in the first half of 2005.

In determining the appropriate provision for loan losses, management considers the level of and trend in non-performing loans, the level of and trend in net loan charge-offs, the dollar amount and mix
of the loan portfolio, as well as general economic conditions and real estate trends in the Company's market area, which can impact the inherent risk of loss in the Company's loan portfolio.

22

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Non-Interest Income and Non-Interest Expense

Non-interest income decreased by $162,000 to $890,000 for the first six months of 2006 compared to $1.1 million in the same period of 2005. This increase is primarily attributable to the
reimbursement of prior year legal fees expended in relation to the above referenced loan loss recovery totaling $167,000. In addition, the Company recognized $35,000 less gains on securities sales in the first half of 2006 compared to the
same period of 2005, due to a lower level of sales activity. Partially offsetting these decreases was an increase in customer fee revenue over the level earned in the same quarter of 2005 and earnings on recently acquired bank owned life insurance
in the amount of $33,000.

Non-interest expense increased to $6.7 million in the first six months of 2006 compared to $4.9 million in the same period of 2005, primarily due to higher benefit costs related to the
Company's stock-based compensation plans and increased expenditures related to compliance with Section 404 of the Sarbanes Oxley Act and strategic planning initiatives. In the second quarter of 2006, the Company granted stock options and restricted
stock awards which are being accounted for using the fair value methodology of SFAS No. 123(R). Total non-cash amortization expense related to these plans was $1.5 million in the quarter ended June 30, 2006, the majority of which was immediate
expensing of options and stock grants made to individuals eligible for retirement under the provisions of the Company's defined benefit plan.

Income tax expense for the first half of 2006 decreased to $526,000 from $935,000 in the same period of 2005, due to the decrease in pre-tax income.

Liquidity and Capital Resources

The Company's primary sources of funds consist of deposits, scheduled amortization and prepayments of loans and mortgage-backed securities, maturities of investments, interest bearing deposits at
other financial institutions and funds provided from operations. The Bank also has a written agreement with the Federal Home Loan Bank of New York that allows it to borrow up to $31.6 million.  At June 30, 2006, the Bank had no outstanding
borrowings on this line of credit, but did have outstanding advances and amortizing notes totaling $8.9 million.

Loan repayments and maturing investment securities are a relatively predictable source of funds. However, deposit flows, calls of investment securities, and prepayments of loans and mortgage-backed
securities are strongly influenced by interest rates, general and local economic conditions, and competition in the marketplace. These factors reduce the predictability of the timing of these sources of funds.

The Company's primary investing activities include the origination of loans and to a lesser extent the purchase of investment securities. For the six months ended June 30, 2006, the Company originated
loans of approximately $22.3 million, compared to $30.4 of loans originated in the first half of 2005.

At June 30, 2006, the Company had loan commitments to borrowers of approximately $16.2 million, and available letters and lines of credit of approximately $14.0 million.

In June of 2006, the Company invested in bank owned life insurance in the amount of $8.0 million, covering certain key employees.

Time deposit accounts scheduled to mature within one year were $45.6 million at June 30, 2006. Based on our deposit retention experience and current pricing strategy, we anticipate that a
significant portion of these time deposits will remain with the Company.  We are committed to maintaining a strong liquidity position; therefore, the Company monitors its liquidity position on a daily basis. The Company anticipates that it will have
sufficient funds to meet its current funding commitments. The marginal cost of new funding however, whether from deposits or borrowings from the Federal Home Loan Bank, will be carefully considered as the

23

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Company monitors its liquidity needs. Therefore, in order to minimize its cost of funds, the Company may consider additional borrowings from the Federal Home Loan Bank in the future.

At June 30, 2006, the Bank exceeded each of the applicable regulatory capital requirements. The Bank's leverage (Tier 1) capital at June 30, 2006 was $61.3 million, or 20.59% of adjusted assets.
In order to be classified as "well-capitalized" by the OTS, the Bank is required to have leverage (Tier 1) capital of $14.9 million, or 5.0% of adjusted assets. To be classified as a well-capitalized bank by the OTS, the Bank must also have a
total risk-based capital ratio of 10.0% . At June 30, 2006, the Bank had a total risk-based capital ratio of 29.0% .

The Company paid cash dividends of $0.075 per share during the three-month period ended June 30, 2006 totaling $693,000.

During the second quarter of 2006, the Company's Board of Directors authorized the repurchase of 1,383,000 of the Company's outstanding common shares over the following twelve month period. Since that
date and as of the filing of this report, $13.4 million has been expended to repurchase shares.

The Company does not anticipate any material capital expenditures, nor does it have any balloon or other payments due on any long-term obligations or any off-balance sheet items other than the
commitments and unused lines of credit noted above.

Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company's financial condition, revenues or expenses, results
of operations, liquidity, capital expenditures or capital resources that is material to investors.

Recent Accounting Pronouncements

FASB Staff Position on FAS No. 115-1 and FAS No. 124-1 (the FSP), The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments, was issued in
November 2005 and addresses the determination of when an investment is considered impaired, whether the impairment is other-than-temporary, and how to measure an impairment loss. The FSP also addresses accounting considerations subsequent to the
recognition of an other-than-temporary impairment on a debt security, and requires certain disclosures about unrealized losses that have not been recognized as other-than-temporary impairments. The FSP replaces the impairment guidance on Emerging
issues Task Force (EITF) Issue No. 03-1 with references to existing authoritative literature concerning other-than-temporary determinations. Under the FSP, losses arising from impairment deemed to be other-than-temporary, must be recognized in
earnings at an amount equal to the entire difference between the securities cost and its fair value at the financial statement date, without considering partial recoveries subsequent to that date. The FSP also required that an investor recognize an
other-than-temporary impairment loss when a decision to sell a security has been made and the investor does not expect the fair value of the security to fully recover prior to the expected time of sale. The FSP became effective for reporting periods
beginning after December 15, 2005 and its initial adoption of this statement had no material impact on the Company's consolidated financial statements.

In July 2006, the FASB released Interpretation No. 48, "Accounting for Uncertainty in Income Taxes." This Interpretation revises the recognition tests for tax positions taken in tax returns such that
a tax benefit is recorded only when it is more likely than not that the tax position will be allowed upon examination by taxing authorities. The amount of such a tax benefit to record is the largest amount that is more likely than not to be allowed.
Any reduction in deferred tax assets or increase in tax liabilities upon adoption will correspondingly reduce retained earnings. The Company has not yet determined the effect of adopting this Interpretation, which is effective for it on January 1,
2007.

24

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

There has been no material change in the Company's interest rate risk profile since December 31, 2005. For a more complete discussion of the Company's asset and liability management policies see
"Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's 2005 Form 10-K.

Item 4. Controls and Procedures

Management, including the Company's President and Chief Executive Officer and the Chief Financial Officer, has evaluated the effectiveness of the Company's disclosure controls and procedures (as defined in Exchange Act Rules
13a-15(e) and 15d-15(e)) as of the end of the period covered by this report. Based upon that evaluation, the President and Chief Executive Officer and Chief Financial Officer concluded that the disclosure controls and procedures were effective to
ensure that information required to be disclosed in the reports the Company files and submits under the Exchange Act is (i) recorded, processed, summarized and reported as and when required and (ii) accumulated and communicated to the Company's
management, including the Company's President and Chief Executive Officer and the Executive Vice President and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

There have been no significant changes in the Company's internal controls over financial reporting identified in connection with the
evaluation that occurred during the Company's last fiscal quarter that has materially affected, or that is reasonably likely to materially affect, the Company's internal control over financial reporting.

Part II - OTHER INFORMATION

|Item 1.  | Legal Proceedings                                                                               
|-------- | ------------------------------------------------------------------------------------------------
|         |                                                                                                 
|         | None.                                                                                           
|         |                                                                                                 
|Item 1A. | Risk Factors                                                                                    
|         |                                                                                                 
|         | There have been no material changes to the Company's risk factors previously disclosed in the   
|         | Company's Form 10-K for the year ending December 31, 2005.                                      
|         |                                                                                                 
|Item 2.  | Unregistered Sales of Equity 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 Company held its Annual Meeting of Shareholders ("Meeting") on May 3, 2006. all of the      
|         | proposals submitted to the shareholders at the Meeting were approved. The proposals submitted   
|         | to the shareholders and the tabulation for votes for each proposal is as follows:               
|         |                                                                                                 
|         | 1. Election of one director to serve for a three-year term to expire at the 2009 Annual Meeting.
|         | The number of votes cast with respect
 to this matter was as follows:                           

25

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Nominee
      
      For
      
      Withheld
      
      Broker Non-votesDale A Laval
      
      8,706,842
      
      319,292
      
      -The following directors'
          terms continued after the meeting: Kirk B. Hinman, Charles M. Sprock,Michael J. Valentine,
          Bruce R. Engelbert, David C. Grow, and T. Richard Leidig.2. Ratification of
          the appointment of Crowe Chizek and Company LLC as the Company'sindependent
          registered public accounting firm for the fiscal year ending December
          31, 2006;For
      
      Withheld
      
      Abstain
      
      Broker Non-votes7,828,705
      
      1,169,269
      
      28,160
      
      -3. Adoption of the
          Rome Bancorp, Inc. 2006 Stock Option Plan. The number of votes cast
          withrespect
          to this matter was as follows:For
      
      Withheld
      
      Abstain
      
      Broker Non-votes5,783,120
      
      574,712
      
      45,888
      
      -4. Adoption of the
          Rome Bancorp, Inc. 2006 Recognition and Retention Plan. The number
          ofvotes
          cast with respect to this matter was as follows:For
      
      Withheld
      
      Abstain
      
      Broker Non-votes5,536,391
      
      820,233
      
      47,094
      
      -


|Item 5. | Other Information
|------- | -----------------
|        |                  
|        | None.            
|        |                  
|Item 6. | Exhibits         

|2.1   | Amended and Restated Plan of Conversion and Agreement and Plan of Reorganization. (1)                                           
|----- | --------------------------------------------------------------------------------------------------------------------------------
|     
|3.1   | Certificate of Incorporation of New Rome Bancorp, Inc. (1)                                                                      
|     
|3.2   | Bylaws of New Rome Bancorp, Inc. (1)                                                                                            
|     
|4.1   | Form of Stock Certificate of New Rome Bancorp, Inc. (1)                                                                         
|     
|10.1  | Form of Employee Stock Ownership Plan of Rome Bancorp, Inc. (2)                                                                 
|     
|10.2  | Amendment No. 1 to Employee Stock Ownership Plan of Rome Bancorp, Inc. (1)                                                      
|     
|10.3  | Amendment No. 2 to Employee Stock Ownership Plan of Rome Bancorp, Inc. (1)                                                      
|     
|10.4  | Form of Executive Employment Agreement by and between Charles M. Sprock and Rome Bancorp, Inc. (2)                              
|     
|10.5  | Form of One Year Change in Control Agreement by and among certain officers and Rome Bancorp, Inc. and The Rome Savings Bank. (1)
|     
|10.6  | Form of Employment Agreement between New Rome Bancorp, Inc. and Charles M. Sprock. (1)                                          
|     
|10.7  | Form of Employment Agreement between The Rome Savings Bank and Charles M. Sprock. (1)                                           
|     
|10.8  | Rome Bancorp, Inc. 2000 Stock Option Plan. (3)                                                                                  
|     
|10.9  | Rome Bancorp, Inc. 2000 Recognition and Retention Plan. (3)                                                                     
|     
|10.10 | Amended and Restated Benefit Restoration Plan of Rome Bancorp, Inc. (4)                                                         
|     
|10.11 | Amended and Restated Directors Deferred Compensation Plan of Rome Bancorp, Inc. (4)                                            
|     
|10.12 | Loan Agreement by and between the Employee Stock Ownership Plan Trust of Rome Bancorp, Inc. and                                 
|     

26

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|      | Rome Bancorp, Inc. (5)                                                        
|----- | ------------------------------------------------------------------------------
|     
|10.13 | Amendment No. 3 to the Employee Stock Ownership Plan of Rome Bancorp, Inc. (6)
|     
|10.14 | Rome Bancorp, Inc. 2006 Stock Option Plan. (7)                                
|     
|10.15 | Rome Bancorp, Inc. 2006 Recognition and Retention Plan. (7)                   
|     
|31.1  | Rule 13a-14a/15d-14a Certification.                                           
|     
|31.2  | Rule 13a-14a/15d-14a Certification.                                           
|     
|32.1  | Section 1350 Certification.                                                   
|     
|32.2  | Section 1350 Certification.                                                   
|     

|(1) | Incorporated by reference to Rome Bancorp, Inc.s Form S-1 (Registration No. 333-121245), filed with the Commission on December 14, 2004, as amended.     
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) | Incorporated by reference to Rome Bancorp, Inc.s Form SB-2 (Registration No. 333-80487), filed with the Commission on June 11, 1999, as amended.         
|   
|(3) | Incorporated by reference to Rome Bancorp, Incs Proxy Statement on Schedule 14A, filed with the Commission on April 5, 2000 and amended on April 2, 2001.
|   
|(4) | Incorporated by reference to Rome Bancorp, Inc.s Form 8-K filed with the Commission on December 27, 2005.                                                
|   
|(5) | Incorporated by reference to Rome Bancorp, Inc.s Form 8-K filed with the Commission on March 29, 2005.                                                   
|   
|(6) | Incorporated by reference to Rome Bancorp, Inc.s Form 8-K filed with the Commission on August 29, 2005.                                                  
|   
|(7) | Incorporated by reference to Rome Bancorp, Inc.'s Proxy statement on Schedule 14A, filed with the Commission on March 29, 2006.                           



SIGNATURES

Pursuant to the requirement 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.

ROMEBANCORP,INC.

|Name                     |  | Title                    |  | Date          
|------------------------ |  | ------------------------ |  | --------------
|                        
|/s/Charles
    M. Sprock |  | Chairman of the Board,   |  | March 29, 2007
|Charles M. Sprock        |  | President and Chief      |  |               
|                         |  | Executive Officer        |  |               
|                         |  | (Principal Executive     |  |               
|                         |  | Officer)                 |  |               
|                        
|                        
|                        
|/s/David
    C. Nolan    |  | Executive Vice President |  | March 29, 2007
|David C. Nolan           |  | and Chief Financial      |  |               
|                         |  | Officer (Principal       |  |               
|                         |  | Financial Officer)       |  |               

27

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