|                                   
|-----------------------------------
|UNITED
 STATES                     
|SECURITIES
 AND EXCHANGE COMMISSION
|WASHINGTON,
 DC 20549              

FORM 10-Q

Quarterly
report under Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2010

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 o

Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files). Yes o No o

Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of large
accelerated filer, accelerated filer and smaller reporting company in Rule
12b-2 of the Exchange Act. (Check one):

Large
accelerated filer o Accelerated filer o
Non-accelerated filer o
Smaller reporting company x

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

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

|                               |           |                                 | 
|------------------------------ | --------- | ------------------------------- | 
|Class                          |           | Outstanding at
 August 11, 2010 | 
|                               |           |                                 | 
|Common
 Stock, par value $0.01 | 6,777,551 |                                

---



ROME
BANCORP, INC.
FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 2010

TABLE
OF CONTENTS

|        |                       |                                                                                        |  |     
|------- | --------------------- | -------------------------------------------------------------------------------------- |  | ----
|        |                       |                                                                                        |  | PAGE
|        |                       |                                                                                        |  |     
|        |                       |                                                                                        |  |     
|PART I  | FINANCIAL INFORMATION |                                                                                        | 
|        |                       |                                                                                        | 
|        | ITEM 1.               | FINANCIAL STATEMENTS (unaudited):                                                      |  |     
|        |                       | CONDENSED CONSOLIDATED BALANCE SHEETS                                                  |  | 3   
|        |                       | CONDENSED CONSOLIDATED STATEMENTS OF INCOME                                            |  | 4   
|        |                       | CONDENSED CONSOLIDATED STATEMENTS OF
 SHAREHOLDERS EQUITY AND COMPREHENSIVE INCOME    |  | 5   
|        |                       | CONDENSED CONSOLIDATED STATEMENTS OF CASH
 FLOWS                                       |  | 6   
|        |                       | NOTES TO UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL STATEMENTS                        |  | 8   
|        |                       |                                                                                        |  |     
|        | ITEM 2.               | MANAGEMENTS
 DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |  | 17  
|        | ITEM 3.               | QUANTITATIVE AND QUALITATIVE DISCLOSURES
 ABOUT MARKET RISK                            |  | 26  
|        | ITEM 4.               | CONTROLS AND PROCEDURES                                                                |  | 26  
|        |                       |                                                                                        | 
|PART II | OTHER INFORMATION     |                                                                                        | 
|        |                       |                                                                                        | 
|        | ITEM 1.               | LEGAL PROCEEDINGS                                                                      |  | 27  
|        | ITEM 1A.              | RISK FACTORS                                                                           |  | 27  
|        | 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                                                                      |  | 28  
|        | ITEM 6.               | EXHIBITS                                                                               |  | 29  
|        |                       |                                                                                        |  |     
|        |                       | SIGNATURES                                                                             |  | 30  

2

---



PART I FINANCIAL INFORMATION

Item 1. Financial Statements

ROME BANCORP, INC. AND SUBSIDIARY
Condensed Consolidated Balance Sheets
June 30, 2010 and December 31, 2009
(in thousands, except share data)
(Unaudited)

|                                                                                                                                                                                  |  |                |         |                    |   |         |  
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------- | ------- | ------------------ | - | ------- | -
|                                                                                                                                                                                  |  | June 30,
 2010 |         | December 31,
 2009 |  
|                                                                                                                                                                                  |  |                |         |                    |  
|Assets                                                                                                                                                                            |  |                |         |                    |   |         |  
|                                                                                                                                                                                  |  |                |         |                    |   |         |  
|Cash and due from banks                                                                                                                                                           |  | $              | 6,582   |                    | $ | 6,547   |  
|Federal funds sold and other short-term investments                                                                                                                               |  |                | 2,723   |                    |   | 1,027   |  
|                                                                                                                                                                                  |  |                |         |                    |   |         |  
|Total cash and cash equivalents                                                                                                                                                   |  |                | 9,305   |                    |   | 7,574   |  
|Securities available for sale, at fair value                                                                                                                                      |  |                | 12,629  |                    |   | 10,024  |  
|Securities held to maturity (fair value of $1,489 and $1,502 at June
 30, 2010 and December 31, 2009, respectively)                                                               |  |                | 1,423   |                    |   | 1,431   |  
|Federal Home Loan Bank Stock                                                                                                                                                      |  |                | 3,074   |                    |   | 3,222   |  
|Loans                                                                                                                                                                             |  |                | 283,021 |                    |   | 287,749 |  
|Less: Allowance for loan loss                                                                                                                                                     |  |                | (2,523  | )                  |   | (2,132  | )
|                                                                                                                                                                                  |  |                |         |                    |   |         |  
|Net loans                                                                                                                                                                         |  |                | 280,498 |                    |   | 285,617 |  
|Premises and equipment, net                                                                                                                                                       |  |                | 5,942   |                    |   | 6,041   |  
|Accrued interest receivable                                                                                                                                                       |  |                | 1,138   |                    |   | 1,117   |  
|Bank-owned life insurance                                                                                                                                                         |  |                | 9,613   |                    |   | 9,415   |  
|Other assets                                                                                                                                                                      |  |                | 6,015   |                    |   | 5,481   |  
|                                                                                                                                                                                  |  |                |         |                    |   |         |  
|Total assets                                                                                                                                                                      |  | $              | 329,637 |                    | $ | 329,922 |  
|                                                                                                                                                                                  |  |                |         |                    |   |         |  
|                                                                                                                                                                                  |  |                |         |                    |   |         |  
|Liabilities & Equity                                                                                                                                                              |  |                |         |                    |   |         |  
|                                                                                                                                                                                  |  |                |         |                    |   |         |  
|Liabilities                                                                                                                                                                       |  |                |         |                    |   |         |  
|Deposits:                                                                                                                                                                         |  |                |         |                    |   |         |  
|Non-interest bearing                                                                                                                                                              |  | $              | 35,454  |                    | $ | 31,790  |  
|Savings                                                                                                                                                                           |  |                | 85,729  |                    |   | 82,031  |  
|Money market                                                                                                                                                                      |  |                | 17,683  |                    |   | 15,726  |  
|Time                                                                                                                                                                              |  |                | 71,112  |                    |   | 71,903  |  
|Other interest bearing                                                                                                                                                            |  |                | 15,809  |                    |   | 15,189  |  
|                                                                                                                                                                                  |  |                |         |                    |   |         |  
|Total deposits                                                                                                                                                                    |  |                | 225,787 |                    |   | 216,639 |  
|Borrowings                                                                                                                                                                        |  |                | 37,618  |                    |   | 47,869  |  
|Other liabilities                                                                                                                                                                 |  |                | 4,947   |                    |   | 5,049   |  
|                                                                                                                                                                                  |  |                |         |                    |   |         |  
|Total liabilities                                                                                                                                                                 |  |                | 268,352 |                    |   | 269,557 |  
|                                                                                                                                                                                  |  |                |         |                    |   |         |  
|                                                                                                                                                                                  |  |                |         |                    |   |         |  
|Shareholders equity                                                                                                                                                              |  |                |         |                    |   |         |  
|Common Stock, $.01 par value; authorized: 30,000,000 shares; issued:
 9,895,757; outstanding 6,777,551 and 6,800,119 shares at June 30, 2010 and
 December 31, 2009, respectively |  |                | 99      |                    |   | 99      |  
|Additional paid-in capital                                                                                                                                                        |  |                | 62,998  |                    |   | 62,794  |  
|Retained earnings                                                                                                                                                                 |  |                | 38,256  |                    |   | 37,588  |  
|Accumulated other comprehensive loss                                                                                                                                              |  |                | (1,435  | )                  |   | (1,574  | )
|Treasury stock; 3,118,206 shares at June 30, 2010 and 3,095,638 shares
 at December 31, 2009                                                                                      |  |                | (36,921 | )                  |   | (36,720 | )
|Unallocated shares of employee stock ownership plan (ESOP): 255,293
 and 278,275 shares at June 30, 2010 and December 31, 2009                                                    |  |                | (1,712  | )                  |   | (1,822  | )
|                                                                                                                                                                                  |  |                |         |                    |   |         |  
|Total shareholders equity                                                                                                                                                        |  |                | 61,285  |                    |   | 60,365  |  
|                                                                                                                                                                                  |  |                |         |                    |   |         |  
|Total liabilities and shareholders equity                                                                                                                                        |  | $              | 329,637 |                    | $ | 329,922 |  
|                                                                                                                                                                                  |  |                |         |                    |   |         |  

See accompanying notes to
unaudited condensed consolidated financial statements.

3

---



ROME BANCORP, INC. AND SUBSIDIARY
Condensed Consolidated Statements of Income
For the Three and Six Months Ended June 30, 2010 and 2009
(in thousands, except share data)(unaudited)

|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|--------------------------------------------------- |  | ------------------------------------ | ----- | ---------------------------------- | - | ----- |  | ---- | ----- |  | - | ----- | 
|                                                    |  | For the three months ended
 June 30, |       | For the six months ended
 June 30, |  
|                                                    |  |                                      |       |                                    |  
|                                                    |  | 2010                                 |       | 2009                               |   | 2010  |  | 2009 |      
|                                                    |  |                                      |       |                                    |  
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Interest income:                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Loans                                               |  | $                                    | 4,026 |                                    | $ | 4,195 |  | $    | 8,118 |  | $ | 8,477 | 
|Securities                                          |  |                                      | 162   |                                    |   | 126   |  |      | 330   |  |   | 205   | 
|Other short-term investments                        |  |                                      |      |                                    |   | 3     |  |      |      |  |   | 5     | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Total interest income                               |  |                                      | 4,188 |                                    |   | 4,324 |  |      | 8,448 |  |   | 8,687 | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Interest expense:                                   |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Deposits                                            |  |                                      | 465   |                                    |   | 635   |  |      | 945   |  |   | 1,313 | 
|Borrowings                                          |  |                                      | 289   |                                    |   | 459   |  |      | 602   |  |   | 894   | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Total interest expense                              |  |                                      | 754   |                                    |   | 1,094 |  |      | 1,547 |  |   | 2,207 | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Net interest income                                 |  |                                      | 3,434 |                                    |   | 3,230 |  |      | 6,901 |  |   | 6,480 | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Provision for loan losses                           |  |                                      | 415   |                                    |   | 200   |  |      | 465   |  |   | 200   | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Net interest income after provision for loan losses |  |                                      | 3,019 |                                    |   | 3,030 |  |      | 6,436 |  |   | 6,280 | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Non-interest income:                                |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Gain on sales of securities                         |  |                                      | 121   |                                    |   |      |  |      | 121   |  |   |      | 
|Gain on sale of real estate                         |  |                                      |      |                                    |   |      |  |      | 418   |  |   |      | 
|Other                                               |  |                                      | 662   |                                    |   | 635   |  |      | 1,224 |  |   | 1,167 | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Total non-interest income                           |  |                                      | 783   |                                    |   | 635   |  |      | 1,763 |  |   | 1,167 | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Non-interest expense:                               |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Salaries and employee benefits                      |  |                                      | 1,567 |                                    |   | 1,553 |  |      | 3,077 |  |   | 3,098 | 
|Building, occupancy and equipment                   |  |                                      | 460   |                                    |   | 476   |  |      | 967   |  |   | 968   | 
|Other                                               |  |                                      | 736   |                                    |   | 684   |  |      | 1,366 |  |   | 1,390 | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Total non-interest expense                          |  |                                      | 2,763 |                                    |   | 2,713 |  |      | 5,410 |  |   | 5,456 | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Income before income tax expense                    |  |                                      | 1,039 |                                    |   | 952   |  |      | 2,789 |  |   | 1,991 | 
|Income tax expense                                  |  |                                      | 345   |                                    |   | 305   |  |      | 948   |  |   | 637   | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Net income                                          |  | $                                    | 694   |                                    | $ | 647   |  | $    | 1,841 |  | $ | 1,354 | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Basic earnings per share                            |  | $                                    | 0.11  |                                    | $ | 0.10  |  | $    | 0.28  |  | $ | 0.20  | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 
|Diluted earnings per share                          |  | $                                    | 0.11  |                                    | $ | 0.10  |  | $    | 0.28  |  | $ | 0.20  | 
|                                                    |  |                                      |       |                                    |   |       |  |      |       |  |   |       | 

See accompanying notes to
unaudited condensed consolidated financial statements.

4

---



ROME BANCORP, INC. AND SUBSIDIARY
Condensed Consolidated Statements of ShareholdersEquity and Comprehensive Income
For the Six Months Ended June 30, 2010 and 2009
(in thousands, except share and per share data)(unaudited)

|                                                        |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |        |   |   |        |   |   |        |  
|------------------------------------------------------- |  | ----------- | -- | ---------------------------- | - | ------------------ |  | --------------- | ------ | ------------------------------------------ | - | ------------------------- | - | ----- | ------ | - | - | ------ | - | - | ------ | -
|                                                        |  | Commonstock |    | Additional
 Paid-in
 Capital |   | Retained
 earnings |  | Treasury
 Stock |        | AccumulatedothercomprehensiveIncome (loss) |   | Unallocated
 ESOP
 shares |   | Total |       
|                                                        |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |       
|Balances at January 1, 2009                             |  | $           | 99 |                              | $ | 62,440             |  | $               | 36,721 |                                            | $ | (34,662                   | ) | $     | (2,212 | ) | $ | (2,042 | ) | $ | 60,344 |  
|Comprehensive income:                                   |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |        |   |   |        |   |   |        |  
|Net Income                                              |  |             |   |                              |   |                   |  |                 | 1,354  |                                            |   |                          |   |       |       |   |   |       |   |   | 1,354  |  
|Other comprehensive income                              |  |             |   |                              |   |                   |  |                 |        |                                            |   |                          |   |       | 151    |   |   |       |   |   | 151    |  
|                                                        |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |        |   |   |        |   |   |        |  
|Total comprehensive income                              |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |        |   |   |        |   |   | 1,505  |  
|                                                        |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |        |   |   |        |   |   |        |  
|Purchase of 181,588 treasury shares                     |  |             |   |                              |   |                   |  |                 |       |                                            |   | (1,408                    | ) |       |       |   |   |       |   |   | (1,408 | )
|Stock-based compensation                                |  |             |   |                              |   | 63                 |  |                 |       |                                            |   |                          |   |       |       |   |   |       |   |   | 63     |  
|Dividends ($0.17 per share)                             |  |             |   |                              |   |                   |  |                 | (1,130 | )                                          |   |                          |   |       |       |   |   |       |   |   | (1,130 | )
|ESOP shares released for allocation (22,982 shares)     |  |             |   |                              |   | 81                 |  |                 |       |                                            |   |                          |   |       |       |   |   | 110    |   |   | 191    |  
|                                                        |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |        |   |   |        |   |   |        |  
|Balances at June 30, 2009                               |  | $           | 99 |                              | $ | 62,584             |  | $               | 36,945 |                                            | $ | (36,070                   | ) | $     | (2,061 | ) | $ | (1,932 | ) | $ | 59,565 |  
|                                                        |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |        |   |   |        |   |   |        |  
|                                                        |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |        |   |   |        |   |   |        |  
|Balances at January 1, 2010                             |  | $           | 99 |                              | $ | 62,794             |  | $               | 37,588 |                                            | $ | (36,720                   | ) | $     | (1,574 | ) | $ | (1,822 | ) | $ | 60,365 |  
|Comprehensive income:                                   |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |        |   |   |        |   |   |        |  
|Net Income                                              |  |             |   |                              |   |                   |  |                 | 1,841  |                                            |   |                          |   |       |       |   |   |       |   |   | 1,841  |  
|Other comprehensive income                              |  |             |   |                              |   |                   |  |                 |       |                                            |   |                          |   |       | 139    |   |   |       |   |   | 139    |  
|                                                        |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |        |   |   |        |   |   |        |  
|Total comprehensive income                              |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |        |   |   |        |   |   | 1,980  |  
|                                                        |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |        |   |   |        |   |   |        |  
|Purchase of 22,568 treasury shares                      |  |             |   |                              |   |                   |  |                 |       |                                            |   | (201                      | ) |       |       |   |   |       |   |   | (201   | )
|Amortization and tax effect of Stock-based compensation |  |             |   |                              |   | 114                |  |                 |       |                                            |   |                          |   |       |       |   |   |       |   |   | 114    |  
|Dividends ($0.18 per share)                             |  |             |   |                              |   |                   |  |                 | (1,173 | )                                          |   |                          |   |       |       |   |   |       |   |   | (1,173 | )
|ESOP shares released for allocation (22,982 shares)     |  |             |   |                              |   | 90                 |  |                 |       |                                            |   |                          |   |       |       |   |   | 110    |   |   | 200    |  
|                                                        |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |        |   |   |        |   |   |        |  
|Balances at June 30, 2010                               |  | $           | 99 |                              | $ | 62,998             |  | $               | 38,256 |                                            | $ | (36,921                   | ) | $     | (1,435 | ) | $ | (1,712 | ) | $ | 61,285 |  
|                                                        |  |             |    |                              |   |                    |  |                 |        |                                            |   |                           |   |       |        |   |   |        |   |   |        |  

See accompanying notes to
unaudited condensed consolidated financial statements.

5

---



ROME BANCORP, INC. AND SUBSIDIARY
Condensed Consolidated Statements of Cash Flows
For the Six Months Ended June 30, 2010 and 2009
(unaudited) (in thousands)

|                                                                                    |  |      |         |      |   |         |  
|----------------------------------------------------------------------------------- |  | ---- | ------- | ---- | - | ------- | -
|                                                                                    |  | 2010 |         | 2009 |  
|                                                                                    |  |      |         |      |  
|Cash flows from operating
 activities:                                              |  |      |         |      |   |         |  
|Net income                                                                          |  | $    | 1,841   |      | $ | 1,354   |  
|Adjustments to reconcile net income to net cash Provided by operating
 activities:  |  |      |         |      |   |         |  
|Depreciation and amortization                                                       |  |      | 247     |      |   | 256     |  
|(Increase) decrease in accrued interest receivable                                  |  |      | (21     | )    |   | 56      |  
|Provision for loan losses                                                           |  |      | 465     |      |   | 200     |  
|Net amortization on securities                                                      |  |      | 48      |      |   | 6       |  
|Proceeds from sales of loans                                                        |  |      | 6,318   |      |   | 5,124   |  
|Net gain on loans sold                                                              |  |      | (93     | )    |   | (73     | )
|Originations of loans held for sale                                                 |  |      | (6,225  | )    |   | (5,051  | )
|Gain on sale of real estate                                                         |  |      | (418    | )    |   | (2      | )
|Gain on securities transactions                                                     |  |      | (121    | )    |   |        |  
|(Decrease) increase in other liabilities                                            |  |      | (102    | )    |   | 245     |  
|Increase in cash surrender value of life insurance                                  |  |      | (198    | )    |   | (206    | )
|Increase in other assets                                                            |  |      | (731    | )    |   | (557    | )
|Allocation of ESOP shares                                                           |  |      | 200     |      |   | 191     |  
|Amortization of unearned stock-based compensation                                   |  |      | 114     |      |   | 114     |  
|                                                                                    |  |      |         |      |   |         |  
|Net cash provided by operating activities                                           |  |      | 1,324   |      |   | 1,657   |  
|                                                                                    |  |      |         |      |   |         |  
|                                                                                    |  |      |         |      |   |         |  
|Cash flows from investing activities:                                               |  |      |         |      |   |         |  
|Net decrease in loans                                                               |  |      | 5,142   |      |   | 8,949   |  
|Proceeds from maturities and principal reductions of securities
 available for sale |  |      | 1,199   |      |   | 346     |  
|Purchases of securities available for sale                                          |  |      | (4,501  | )    |   | (4,327  | )
|Proceeds from sale of securities available for sale                                 |  |      | 849     |      |   |         |  
|Redemption of Federal Home Loan Bank stock                                          |  |      | 148     |      |   | 255     |  
|Proceeds from maturities and principal reductions of securities held
 to maturity   |  |      | 5       |      |   | 6       |  
|Proceeds from sale of real estate owned                                             |  |      | 190     |      |   | 332     |  
|Additions to premises and equipment                                                 |  |      | (148    | )    |   | (100    | )
|                                                                                    |  |      |         |      |   |         |  
|Net cash provided by investing activities                                           |  |      | 2,884   |      |   | 5,461   |  
|                                                                                    |  |      |         |      |   |         |  
|                                                                                    |  |      |         |      |   |         |  
|Cash flows from financing activities:                                               |  |      |         |      |   |         |  
|(Decrease) increase in time deposits                                                |  |      | (791    | )    |   | 406     |  
|Increase in other deposits                                                          |  |      | 9,939   |      |   | 10,222  |  
|Repayments of borrowings                                                            |  |      | (24,326 | )    |   | (24,601 | )
|Additional borrowings                                                               |  |      | 14,075  |      |   | 13,284  |  
|Purchase of treasury stock                                                          |  |      | (201    | )    |   | (1,408  | )
|Dividends paid                                                                      |  |      | (1,173  | )    |   | (1,130  | )
|                                                                                    |  |      |         |      |   |         |  
|Net cash used in financing activities                                               |  |      | (2,477  | )    |   | (3,227  | )
|                                                                                    |  |      |         |      |   |         |  
|                                                                                    |  |      |         |      |   |         |  
|Net increase in cash and cash equivalents                                           |  |      | 1,731   |      |   | 3,891   |  
|Cash and cash equivalents at beginning of period                                    |  |      | 7,574   |      |   | 9,579   |  
|                                                                                    |  |      |         |      |   |         |  
|Cash and cash equivalents at end of period                                          |  | $    | 9,305   |      | $ | 13,470  |  
|                                                                                    |  |      |         |      |   |         |  
|                                                                                    |  |      |         |      |   |         |  
|Condensed Consolidated
 Statements of Cash Flows continued on next page.            |  |      |         |      |   |         |  

6

---



ROME BANCORP, INC. AND SUBSIDIARY
Condensed Consolidated Statements of Cash Flows
For the Six Months Ended June 30, 2010 and 2009
(unaudited) (in thousands)

|                                                   |  |      |       |      |   |       | 
|-------------------------------------------------- |  | ---- | ----- | ---- | - | ----- | 
|                                                   |  | 2010 |       | 2009 |  
|                                                   |  |      |       |      |  
|Supplemental disclosure of
 cash flow information: |  |      |       |      |   |       | 
|Non-cash investing activities:                     |  |      |       |      |   |       | 
|Transfers from loans to other real estate          |  | $    | 65    |      | $ | 192   | 
|Cash paid during the period for:                   |  |      |       |      |   |       | 
|Interest                                           |  |      | 1,576 |      |   | 2,178 | 
|Income taxes                                       |  |      | 1,175 |      |   | 422   | 

See accompanying notes to
unaudited condensed consolidated financial statements.

7

---



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

(1) 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, 2010 and December 31, 2009 and for the three and
six month periods ended June 30, 2010 and 2009. 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. Management has evaluated
all significant events and transactions that occurred through the financial
statement issuance date for potential recognition or disclosure in these
condensed consolidated financial statements.

The data in the condensed
consolidated balance sheet as of December 31, 2009 was derived from the
Companys 2009 Annual Report on Form 10-K. That data, along with the interim
financial information presented in the condensed consolidated balance sheets,
statements of income, statements of shareholders equity and comprehensive
income and statements of cash flows should be read in conjunction with the 2009
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.

(2) Earnings
per Common Share

The Company has stock compensation awards with non-forfeitable dividend
rights which are considered participating securities. The effect of including
these participating securities in earnings per share computations is immaterial.
ESOP shares are considered outstanding for this calculation unless unearned.
Diluted earnings per common share include the dilutive effect of additional
potential common shares from stock-based compensation plans.

8

---



The following summarizes the computation of earnings per share for the
three and six month periods ended June 30, 2010 and 2009.

(in thousands, except per share data)

|                                            |  |                               |       |                             |   |       |   |      |       |   |   |       |  
|------------------------------------------- |  | ----------------------------- | ----- | --------------------------- | - | ----- | - | ---- | ----- | - | - | ----- | -
|                                            |  | Three months ended 
 June 30, |       | Six months ended 
 June 30, |  
|                                            |  |                               |       |                             |  
|                                            |  | 2010                          |       | 2009                        |   | 2010  |   | 2009 |      
|                                            |  |                               |       |                             |   |       |   |      |      
|Basic earnings per share:                   |  |                               |       |                             |   |       |   |      |       |   |   |       |  
|Net Income                                  |  | $                             | 694   |                             | $ | 647   |   | $    | 1,841 |   | $ | 1,354 |  
|Weighted average common shares outstanding  |  |                               | 6,781 |                             |   | 6,883 |   |      | 6,789 |   |   | 6,936 |  
|Less: Average unallocated ESOP shares       |  |                               | (266  | )                           |   | (312  | ) |      | (272  | ) |   | (318  | )
|                                            |  |                               |       |                             |   |       |   |      |       |   |   |       |  
|Average basic shares                        |  |                               | 6,515 |                             |   | 6,571 |   |      | 6,517 |   |   | 6,618 |  
|                                            |  |                               |       |                             |   |       |   |      |       |   |   |       |  
|Basic earnings per share                    |  | $                             | 0.11  |                             | $ | 0.10  |   | $    | 0.28  |   | $ | 0.20  |  
|                                            |  |                               |       |                             |   |       |   |      |       |   |   |       |  
|                                            |  |                               |       |                             |   |       |   |      |       |   |   |       |  
|Diluted earnings per share:                 |  |                               |       |                             |   |       |   |      |       |   |   |       |  
|Net income                                  |  | $                             | 694   |                             | $ | 647   |   | $    | 1,841 |   | $ | 1,354 |  
|Weighted average basic shares outstanding   |  |                               | 6,515 |                             |   | 6,571 |   |      | 6,517 |   |   | 6,618 |  
|Effect of dilutive securities:              |  |                               |      |                             |   |      |   |      |      |   |   |      |  
|                                            |  |                               |       |                             |   |       |   |      |       |   |   |       |  
|Weighted average diluted shares outstanding |  |                               | 6,515 |                             |   | 6,571 |   |      | 6,517 |   |   | 6,618 |  
|                                            |  |                               |       |                             |   |       |   |      |       |   |   |       |  
|Diluted earnings per share                  |  | $                             | 0.11  |                             | $ | 0.10  |   | $    | 0.28  |   | $ | 0.20  |  
|                                            |  |                               |       |                             |   |       |   |      |       |   |   |       |  

|    |                                                                                                                                                                                                                        
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | Stock options for 354,000
 shares of common stock were not considered in computing diluted earnings per
 common share for the three and six month periods ended June 30, 2010 and 2009
 because they were antidilutive.
|    |                                                                                                                                                                                                                        
|(3) | Other
 Comprehensive Income                                                                                                                                                                                            

|                                                                                          |  |                              |      |                            |   |      |   |      |       |   |   |       |  
|----------------------------------------------------------------------------------------- |  | ---------------------------- | ---- | -------------------------- | - | ---- | - | ---- | ----- | - | - | ----- | -
|                                                                                          |  | Three months ended
 June 30, |      | Six months ended
 June 30, |  
|                                                                                          |  | (in thousands)               |     
|                                                                                          |  |                              |     
|                                                                                          |  | 2010                         |      | 2009                       |   | 2010 |   | 2009 |      
|                                                                                          |  |                              |      |                            |   |      |   |      |      
|Pension and postretirement
 adjustments                                                   |  | $                            | 79   |                            | $ | 94   |   | $    | 156   |   | $ | 188   |  
|Net change in unrealized gain
 on available-for-sale securities arising during the period |  |                              | 66   |                            |   | 78   |   |      | 197   |   |   | 64    |  
|Reclassification adjustment for
 net realized gain included in net income                 |  |                              | (121 | )                          |   |     |   |      | (121  | ) |   |      |  
|                                                                                          |  |                              |      |                            |   |      |   |      |       |   |   |       |  
|Other comprehensive income,
 before tax                                                   |  |                              | 24   |                            |   | 172  |   |      | 232   |   |   | 252   |  
|Deferred tax effect                                                                       |  |                              | (11  | )                          |   | (69  | ) |      | (93   | ) |   | (101  | )
|                                                                                          |  |                              |      |                            |   |      |   |      |       |   |   |       |  
|                                                                                          |  |                              |      |                            |   |      |   |      |       |   |   |       |  
|Other comprehensive income                                                                |  |                              | 13   |                            |   | 103  |   |      | 139   |   |   | 151   |  
|Net income                                                                                |  |                              | 694  |                            |   | 647  |   |      | 1,841 |   |   | 1,354 |  
|                                                                                          |  |                              |      |                            |   |      |   |      |       |   |   |       |  
|Total comprehensive income                                                                |  | $                            | 707  |                            | $ | 750  |   | $    | 1,980 |   | $ | 1,505 |  
|                                                                                          |  |                              |      |                            |   |      |   |      |       |   |   |       |  

9

---



|    |                                                     
|--- | ----------------------------------------------------
|(4) | Securities                                          
|    |                                                     
|    | Securities are summarized as follows (In thousands):

|                                |  |               |        |                           |   |                            |  |             |    |  |   |        | 
|------------------------------- |  | ------------- | ------ | ------------------------- | - | -------------------------- |  | ----------- | -- |  | - | ------ | 
|                                |  |               |       
|                                |  | June 30, 2010 |       
|                                |  |               |       
|                                |  | AmortizedCost |        | Gross 
 unrealized
 gains |   | Gross 
 unrealized
 losses |  | Fair
 value |   
|                                |  |               |       
|Available-for-sale:             |  |               |        |                           |   |                            |  |             |    |  |   |        | 
|State and municipal obligations |  | $             | 2,007  |                           | $ | 176                        |  | $           |   |  | $ | 2,183  | 
|Corporate obligations           |  |               | 9,855  |                           |   | 200                        |  |             | 43 |  |   | 10,012 | 
|                                |  |               |        |                           |   |                            |  |             |    |  |   |        | 
|                                |  |               |        |                           |   |                            |  |             |    |  |   |        | 
|Total debt securities           |  |               | 11,862 |                           |   | 376                        |  |             | 43 |  |   | 12,195 | 
|                                |  |               |        |                           |   |                            |  |             |    |  |   |        | 
|Equity and other securities     |  |               | 430    |                           |   | 4                          |  |             |   |  |   | 434    | 
|                                |  |               |        |                           |   |                            |  |             |    |  |   |        | 
|                                |  | $             | 12,292 |                           | $ | 380                        |  | $           | 43 |  | $ | 12,629 | 
|                                |  |               |        |                           |   |                            |  |             |    |  |   |        | 
|                                |  |               |        |                           |   |                            |  |             |    |  |   |        | 
|Held-to-maturity:               |  |               |        |                           |   |                            |  |             |    |  |   |        | 
|U.S. Government securities      |  | $             | 1,312  |                           | $ | 66                         |  | $           |   |  | $ | 1,378  | 
|Other bonds                     |  |               | 111    |                           |   |                           |  |             |   |  |   | 111    | 
|                                |  |               |        |                           |   |                            |  |             |    |  |   |        | 
|                                |  | $             | 1,423  |                           | $ | 66                         |  | $           |   |  | $ | 1,489  | 
|                                |  |               |        |                           |   |                            |  |             |    |  |   |        | 

|                                |  |                   |       |                      |   |                        |  |           |    |  |   |        | 
|------------------------------- |  | ----------------- | ----- | -------------------- | - | ---------------------- |  | --------- | -- |  | - | ------ | 
|                                |  |                   |      
|                                |  | December 31, 2009 |      
|                                |  |                   |      
|                                |  | AmortizedCost     |       | Grossunrealizedgains |   | Gross UnrealizedLosses |  | Fairvalue |   
|                                |  |                   |       |                      |   |                        |  |           |   
|Available-for-sale:             |  |                   |       |                      |   |                        |  |           |    |  |   |        | 
|State and municipal obligations |  | $                 | 2,294 |                      | $ | 119                    |  | $         |   |  | $ | 2,413  | 
|Corporate obligations           |  |                   | 6,597 |                      |   | 85                     |  |           | 39 |  |   | 6,643  | 
|                                |  |                   |       |                      |   |                        |  |           |    |  |   |        | 
|Total debt securities           |  |                   | 8,891 |                      |   | 204                    |  |           | 39 |  |   | 9,056  | 
|                                |  |                   |       |                      |   |                        |  |           |    |  |   |        | 
|Equity and other securities     |  |                   | 872   |                      |   | 96                     |  |           |   |  |   | 968    | 
|                                |  |                   |       |                      |   |                        |  |           |    |  |   |        | 
|                                |  | $                 | 9,763 |                      | $ | 300                    |  | $         | 39 |  | $ | 10,024 | 
|                                |  |                   |       |                      |   |                        |  |           |    |  |   |        | 
|Held-to-maturity:               |  |                   |       |                      |   |                        |  |           |    |  |   |        | 
|U.S. Government securities      |  | $                 | 1,316 |                      | $ | 71                     |  | $         |   |  | $ | 1,387  | 
|Mortgage-backed securities GNMA |  |                   | 1     |                      |   |                       |  |           |   |  |   | 1      | 
|Other bonds                     |  |                   | 114   |                      |   |                       |  |           |   |  |   | 114    | 
|                                |  |                   |       |                      |   |                        |  |           |    |  |   |        | 
|                                |  | $                 | 1,431 |                      | $ | 71                     |  | $         |   |  | $ | 1,502  | 
|                                |  |                   |       |                      |   |                        |  |           |    |  |   |        | 

| |                                                                                                                                                                                                                                                                                                                          
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | All of the gross unrealized losses on available for sale securities
 at both June 30, 2010 and December 31, 2009 were less than one year in
 duration. The detail of these losses and the carrying value (at estimated
 fair value) of the underlying securities available for sale are summarized
 below (in thousands):

|                      |  |                  |    |                   |   |                  |  |                  |    |  |   |       | 
|--------------------- |  | ---------------- | -- | ----------------- | - | ---------------- |  | ---------------- | -- |  | - | ----- | 
|                      |  | June 30, 2010    |    | December 31, 2009 |  
|                      |  |                  |    |                   |  
|                      |  | Unrealized
 Loss |    | Carrying 
 Value  |   | Unrealized
 Loss |  | Carrying 
 Value |   
|                      |  |                  |    |                   |   |                  |  |                  |   
|One year or
 less:    |  |                  |    |                   |   |                  |  |                  |    |  |   |       | 
|Corporate obligations |  | $                | 43 |                   | $ | 2,847            |  | $                | 39 |  | $ | 2,891 | 
|                      |  |                  |    |                   |   |                  |  |                  |    |  |   |       | 
|Total                 |  | $                | 43 |                   | $ | 2,847            |  | $                | 39 |  | $ | 2,891 | 
|                      |  |                  |    |                   |   |                  |  |                  |    |  |   |       | 

10

---



| |                                                                                                                                                                                                                                                                                                                
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Management evaluates securities for other than temporary impairment
 at least on a quarterly basis, and more frequently when economic or market
 conditions warrant such an evaluation. There were no investments deemed by
 management to be other than temporarily impaired at June 30, 2010.                
| |                                                                                                                                                                                                                                                                                                                
| | The following table presents the amortized cost and fair value of
 debt securities based on the contractual maturity date (in thousands).
 Expected maturities will differ from contractual maturities because issuers
 may have the right to call or prepay obligations without call or prepayment
 penalties.

|                                        |  |               |        |              |   |        | 
|--------------------------------------- |  | ------------- | ------ | ------------ | - | ------ | 
|                                        |  | June 30, 2010 |       
|                                        |  |               |       
|                                        |  | AmortizedCost |        | Fair 
 Value |  
|                                        |  |               |        |              |  
|Available-for-sale:                     |  |               |        |              |   |        | 
|Due within one year                     |  | $             | 1,013  |              | $ | 1,017  | 
|Due after one year through five
 years  |  |               | 9,156  |              |   | 9,374  | 
|Due after five years through
 ten years |  |               | 1,693  |              |   | 1,804  | 
|Due after 10 years                      |  |               |       |              |   |       | 
|                                        |  |               |        |              |   |        | 
|                                        |  | $             | 11,862 |              | $ | 12,195 | 
|                                        |  |               |        |              |   |        | 
|Held-to-maturity:                       |  |               |        |              |   |        | 
|Due within one year                     |  | $             |       |              | $ |       | 
|Due after one year through five
 years  |  |               | 1,312  |              |   | 1,378  | 
|Due after five years through
 ten years |  |               |       |              |   |       | 
|Due after ten years                     |  |               | 111    |              |   | 111    | 
|                                        |  |               |        |              |   |        | 
|                                        |  | $             | 1,423  |              | $ | 1,489  | 
|                                        |  |               |        |              |   |        | 

| |                                                                                                                                                                                                                                                                                                                  
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Securities
 pledged at both June 30, 2010 and December 31, 2009 had a carrying amount of
 $1.3 million. These securities collateralize state and Treasury department
 programs. As of these dates, there were no holdings of securities of any one
 issuer in an amount greater than 10% of shareholders equity.

11

---



|    |                                 
|--- | --------------------------------
|(5) | Loans                           
|    |                                 
|    | Loans are summarized as follows:

|                                   |  |                |         |                    |   |         | 
|---------------------------------- |  | -------------- | ------- | ------------------ | - | ------- | 
|                                   |  | June 30,
 2010 |         | December 31,
 2009 |  
|                                   |  |                |         |                    |  
|                                   |  | (in thousands) |        
|Mortgage loans:                    |  |                |         |                    |   |         | 
|Residential (1-4 family)           |  | $              | 153,935 |                    | $ | 155,547 | 
|Commercial                         |  |                | 52,139  |                    |   | 52,557  | 
|Construction and land              |  |                | 2,551   |                    |   | 4,381   | 
|                                   |  |                |         |                    |   |         | 
|                                   |  |                |         |                    |   |         | 
|Total Mortgage loans               |  |                | 208,625 |                    |   | 212,485 | 
|                                   |  |                |         |                    |   |         | 
|Other loans:                       |  |                |         |                    |   |         | 
|Commercial                         |  |                | 29,912  |                    |   | 30,429  | 
|Automobile loans                   |  |                | 8,311   |                    |   | 9,377   | 
|Property improvement and equipment |  |                | 20,875  |                    |   | 19,251  | 
|Other consumer                     |  |                | 15,298  |                    |   | 16,207  | 
|                                   |  |                |         |                    |   |         | 
|                                   |  |                |         |                    |   |         | 
|Total Other loans                  |  |                | 74,396  |                    |   | 75,264  | 
|                                   |  |                |         |                    |   |         | 
|                                   |  |                |         |                    |   |         | 
|Total Loans                        |  | $              | 283,021 |                    | $ | 287,749 | 
|                                   |  |                |         |                    |   |         | 

| |                                                                     
| | --------------------------------------------------------------------
| | Changes in the allowance for loan losses are
 summarized as follows:

|                                 |  |                              |       |                            |   |       |   |      |       |   |   |       |  
|-------------------------------- |  | ---------------------------- | ----- | -------------------------- | - | ----- | - | ---- | ----- | - | - | ----- | -
|                                 |  | Three months ended
 June 30, |       | Six months ended
 June 30, |  
|                                 |  |                              |       |                            |  
|                                 |  | (in thousands)               |      
|                                 |  | 2010                         |       | 2009                       |   | 2010  |   | 2009 |      
|                                 |  |                              |       |                            |   |       |   |      |      
|Balance at beginning of period   |  | $                            | 2,181 |                            | $ | 1,918 |   | $    | 2,132 |   | $ | 1,936 |  
|Provision charged to
 operations |  |                              | 415   |                            |   | 200   |   |      | 465   |   |   | 200   |  
|Loans charged off                |  |                              | (87   | )                          |   | (26   | ) |      | (112  | ) |   | (63   | )
|Recoveries                       |  |                              | 14    |                            |   | 13    |   |      | 38    |   |   | 32    |  
|                                 |  |                              |       |                            |   |       |   |      |       |   |   |       |  
|                                 |  |                              |       |                            |   |       |   |      |       |   |   |       |  
|Balance at end of period         |  | $                            | 2,523 |                            | $ | 2,105 |   | $    | 2,523 |   | $ | 2,105 |  
|                                 |  |                              |       |                            |   |       |   |      |       |   |   |       |  

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Companys recorded
 investment in loans that are considered impaired totaled $2.8 million and
 $698,000 at June 30, 2010 and December 31, 2009, respectively. These impaired
 loans carried allowances of $746,000 and $242,000 June 30, 2010 and December
 31, 2009, respectively. The average recorded investment in impaired loans was
 $1.4 million and $706,000 in the first six months of 2010 and 2009,
 respectively. The Company recognized $21,000 and $41,000 on impaired loans
 that were in compliance with all lending terms during the three and six month
 periods ended June 30, 2010 and 2009.

12

---



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | The principal balances
 of loans not accruing interest, including consumer, real estate, mortgage and
 other loans not subject to impairment disclosures, amounted to $2.2 million
 and $1.9 million at June 30, 2010 and December 31, 2009, respectively. The
 Company held loans 90 days past due and accruing interest totaling $181,000
 and $43,000 at June 30, 2010 and December 31, 2009, 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 six
 month periods ended June 30, 2010 and 2009 was $46,700 and $41,400,
 respectively. There are no commitments to extend further credit on
 non-accruing loans.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | In addition to the
 impaired and non-performing loans, management has identified, through normal
 internal credit review procedures, $6.79 million in potential problem loans
 at June 30, 2010. Payments are current on $6.14 million or 90.4% of these
 loans. These problem loans are defined as loans not included as
 non-performing loans, but about which management has developed information
 regarding possible credit problems, which may cause the borrowers future
 difficulties in complying with loan repayments. The Company will continue to
 be aggressive in identifying, monitoring and resolving potential problem
 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 individual
 borrower. The Company does not originate sub-prime mortgage loans and has not
 purchased investments collateralized by sub-prime loans.                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(6) | Stock-Based Compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | 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 in certain cases upon retirement. At May
 24, 2006, certain awardees met the retirement eligibility criteria and
 accordingly, stock-based compensation expense of $350,000 related to their
 options was expensed immediately. As of June 30, 2010, unrecognized
 compensation cost related to these options was $46,000. This expense is being
 amortized on a straight line basis over the remainder of the sixty month
 vesting period of the options.                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | Following is a summary
 of the Companys 2010 year to date stock option activity:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

|                                         |  |                                 |         |                                   |   |                               |  |   |      | 
|---------------------------------------- |  | ------------------------------- | ------- | --------------------------------- | - | ----------------------------- |  | - | ---- | 
|                                         |  | Six
 Months ended June 30, 2010 |        
|                                         |  |                                 |        
|                                         |  | Shares                          |         | Weighted
 Average
 Exercise Price |   | Weighted
 Average
 Fair Value | 
|                                         |  |                                 |         |                                   |   |                               | 
|Options outstanding, beginning of period |  |                                 | 354,000 |                                   | $ | 12.84                         |  | $ | 1.69 | 
|Exercised                                |  |                                 |        |                                   |   |                              |  |   |     | 
|Granted                                  |  |                                 |        |                                   |   |                              |  |   |     | 
|                                         |  |                                 |         |                                   |   |                               |  |   |      | 
|Options outstanding at end of period     |  |                                 | 354,000 |                                   | $ | 12.84                         |  | $ | 1.69 | 
|                                         |  |                                 |         |                                   |   |                               |  |   |      | 
|Options exercisable at end of period     |  |                                 | 283,200 |                                   | $ | 12.84                         |  | $ | 1.69 | 
|                                         |  |                                 |         |                                   |   |                               |  |   |      | 

| |                                                                                                                                                                                                                                                                                                                              
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The aggregate intrinsic
 value of all options outstanding and exercisable at June 30, 2010 was $0. No
 stock options were exercised during the quarters ended June 30, 2010 or 2009.
 The intrinsic value of options exercised during the six months ended June 30,
 2010 and June 30, 2009 was $0 and $18,000, 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,                                                                                                                 

13

---



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | or in certain cases
 upon retirement and the related unrecognized compensation cost related to
 this grant will be expensed over the same period. At May 24, 2006, certain
 awardees met the retirement eligibility criteria and accordingly, stock-based
 compensation expense of $1.1 million related to their 2006 Recognition and
 Retention Plan (RRP) awards was expensed immediately. One-fifth of the 2006
 restricted stock grants, or 33,660 shares, vested in the current quarter. At
 June 30, 2010, the unrecognized compensation cost attributable to restricted
 stock awards was $163,000. The aggregate intrinsic value of restricted stock
 that is expected to vest in the future was $315,000 at June 30, 2010.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    | For both of the three
 and six month periods ended June 30, 2010 and 2009, the compensation cost for
 the Companys stock option plans was $13,000 and $25,000, respectively. For
 both of the three and six month periods ended June 30, 2010 and 2009
 compensation cost related to the restricted stock plan was $44,000 and
 $89,000, respectively.                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    | During
the three month periods ended June 30, 2010 and 2009, dividends of $6,000 and
$9,000, respectively, were paid on unvested shares with non-forfeitable
dividend rights. During the six month periods ended June 30, 2010 and 2009,
dividends of $12,000 and $17,000, respectively, were paid on unvested shares
with non-forfeitable dividend rights. These dividend amounts were not
included in net income as compensation expense due to the expectation that
all of the awards will vest.                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(7) | 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            |      | Postretirement
 benefits |  
|                                         |  |                              |      |                          |  
|                                         |  | 2010                         |      | 2009                     |   | 2010 |   | 2009 |   
|                                         |  |                              |      |                          |   |      |   |      |   
|Components of net periodic pension cost: |  |                              |      |                          |   |      |   |      |    |   |   |    |  
|Service cost                             |  | $                            |     |                          | $ |     |   | $    | 4  |   | $ | 5  |  
|Interest cost                            |  |                              | 88   |                          |   | 87   |   |      | 34 |   |   | 37 |  
|Expected return
 on plan assets          |  |                              | (115 | )                        |   | (108 | ) |      |   |   |   |   |  
|Amortization                             |  |                              | 81   |                          |   | 96   |   |      | (4 | ) |   | (2 | )
|                                         |  |                              |      |                          |   |      |   |      |    |   |   |    |  
|                                         |  |                              |      |                          |   |      |   |      |    |   |   |    |  
|Net periodic
 pension cost               |  | $                            | 54   |                          | $ | 75   |   | $    | 34 |   | $ | 40 |  
|                                         |  |                              |      |                          |   |      |   |      |    |   |   |    |  

|                                         |  |                            |      |                          |   |      |   |      |    |   |   |    |  
|---------------------------------------- |  | -------------------------- | ---- | ------------------------ | - | ---- | - | ---- | -- | - | - | -- | -
|                                         |  | Six
 months ended June 30, |     
|                                         |  |                            |     
|                                         |  | (in
 thousands)            |     
|                                         |  | Pension
 benefits          |      | Postretirement
 benefits |  
|                                         |  |                            |      |                          |  
|                                         |  | 2010                       |      | 2009                     |   | 2010 |   | 2009 |   
|                                         |  |                            |      |                          |   |      |   |      |   
|Components of net periodic pension cost: |  |                            |      |                          |   |      |   |      |    |   |   |    |  
|Service cost                             |  | $                          |     |                          | $ |     |   | $    | 8  |   | $ | 10 |  
|Interest cost                            |  |                            | 176  |                          |   | 174  |   |      | 69 |   |   | 74 |  
|Expected return
 on plan assets          |  |                            | (230 | )                        |   | (216 | ) |      |   |   |   |   |  
|Amortization                             |  |                            | 162  |                          |   | 192  |   |      | (9 | ) |   | (4 | )
|                                         |  |                            |      |                          |   |      |   |      |    |   |   |    |  
|                                         |  |                            |      |                          |   |      |   |      |    |   |   |    |  
|Net periodic
 pension cost               |  | $                          | 108  |                          | $ | 150  |   | $    | 68 |   | $ | 80 |  
|                                         |  |                            |      |                          |   |      |   |      |    |   |   |    |  

|    |                                                                                                                                                                                                                                                                                                                               
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | 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, 2010, the Company
 expects to make no contributions to the defined benefit pension plan.                                                    
|    |                                                                                                                                                                                                                                                                                                                               
|(8) | Fair Value Measurement                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                               
|    | The FASB ASC Topic 820, Financial Instruments,
 requires the disclosure of the estimated fair value of certain financial
 instruments. Fair value is the price that would be received upon sale of an
 asset or paid to transfer a liability in an orderly transaction between
 market participants at the measurement date.

14

---



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The following fair value hierarchy is used in
 selecting inputs, with the highest priority given to Level 1, as these are
 the most transparent or reliable.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | Level 1 - Quoted prices for identical instruments in
 active markets that the Company has the ability to access as of the
 measurement date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Level 2  Significant other observable inputs, such
 as quoted prices for similar instruments in active markets; quoted prices for
 identical or similar instruments in markets that are not active; and
 model-derived valuations in which all significant inputs are observable in
 active markets.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | Level 3  Significant unobservable inputs that
 reflect the Companys own assumptions about the assumptions that market
 participants would use in pricing an instrument.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | The Company is responsible for the valuation process
 and as part of this process may use data from outside sources in establishing
 fair value. The Company performs due diligence to understand the inputs used
 or how the data was calculated or derived. The Company corroborates the
 reasonableness of external inputs in the valuation process.                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | To estimate the fair value of its available for sale
 securities portfolio, the Company obtains current market pricing from quoted
 market sources or using pricing for similar securities. The fair value
 of impaired loans with specific allocations of the allowance for loan losses
 is generally based on recent real estate appraisals. These appraisals may
 utilize a single valuation approach or a combination of approaches including
 comparable sales and the income approach. Adjustments are routinely made in
 the appraisal process by the appraisers to adjust for differences between the
 comparable sales and income data available. Such adjustments are typically
 significant and result in a Level 3 classification of the inputs for
 determining fair value.
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | Assets measured at fair value on a recurring basis
 are summarized below (in thousands of dollars).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

|                                 |  |          |     |          |   |          |  |                                  |   |  |   |        | 
|-------------------------------- |  | -------- | --- | -------- | - | -------- |  | -------------------------------- | - |  | - | ------ | 
|                                 |  | Level
 1 |     | Level
 2 |   | Level
 3 |  | TotalAssetsmeasuredat fair value |  
|June 30, 2010                    |  |          |     |          |   |          |  |                                  |   |  |   |        | 
|Available for sale securities:   |  |          |     |          |   |          |  |                                  |   |  |   |        | 
|State and
 municipal obligations |  | $        |    |          | $ | 2,183    |  | $                                |  |  | $ | 2,183  | 
|Corporate
 obligations           |  |          |    |          |   | 10,012   |  |                                  |  |  |   | 10,012 | 
|Equity and other
 obligations    |  |          | 34  |          |   | 400      |  |                                  |  |  |   | 434    | 
|                                 |  |          |     |          |   |          |  |                                  |   |  |   |        | 
|December 31, 2009                |  |          |     |          |   |          |  |                                  |   |  |   |        | 
|Available for
 sale securities:  |  |          |     |          |   |          |  |                                  |   |  |   |        | 
|State and
 municipal obligations |  | $        |    |          |   | 2,413    |  |                                  |  |  |   | 2,413  | 
|Corporate
 obligations           |  |          |    |          |   | 6,643    |  |                                  |  |  |   | 6,643  | 
|Equity and other
 obligations    |  |          | 568 |          |   | 400      |  |                                  |  |  |   | 968    | 

| |                                                                                                        
| | -------------------------------------------------------------------------------------------------------
| | Assets measured at fair value on a non-recurring
 basis are summarized below (in thousands of dollars).

|                  |  |          |   |          |   |          |  |                                  |       |  |   |       | 
|----------------- |  | -------- | - | -------- | - | -------- |  | -------------------------------- | ----- |  | - | ----- | 
|                  |  | Level
 1 |   | Level
 2 |   | Level
 3 |  | TotalAssetsmeasuredat fair value |      
|June 30, 2010     |  |          |   |          |   |          |  |                                  |       |  |   |       | 
|Impaired loans    |  | $        |  |          | $ |         |  | $                                | 2,030 |  | $ | 2,030 | 
|                  |  |          |   |          |   |          |  |                                  |       |  |   |       | 
|December 31, 2009 |  |          |   |          |   |          |  |                                  |       |  |   |       | 
|Impaired loans    |  | $        |  |          | $ |         |  | $                                | 456   |  | $ | 456   | 

| |                                                                                                                                                                                                                                                                                                                
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Impaired loans, which are measured for impairment
 using the fair value of the collateral for collateral dependent loans, had a
 cost basis of $2.8 million and $698,000 at June 30, 2010 and December 31,
 2009, respectively. These loans carried a valuation allowance of $746,000 and
 $242,000 at June 30,

15

---



| |                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 2010 and December 31, 2009, respectively, resulting in no additional
 provision for loan losses for such periods.                                            
| |                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | The following methods and assumptions were used by the Company in
 estimating fair values of financial instruments:                                          
| |                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |                                                                                                                                                               | Cash and cash equivalents:
 For these short-term instruments that generally mature in ninety days or
 less, the carrying value approximates fair value.                                                                                                                                                                                                                                                                                                                                                       
| |                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |                                                                                                                                                               | Securities: The
 fair values of securities available for sale are determined by obtaining
 quoted prices on nationally recognized securities exchanges (Level 1 inputs)
 or matrix pricing, which is a mathematical technique widely used to in the
 industry to value debt securities without relying exclusively on quoted
 prices for the specific securities but rather by relying on the securities
 relationship to other benchmark quoted securities (Level 2 inputs).                                
| |                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |                                                                                                                                                               | Federal Home Loan Bank Stock:It
 is not practicable to determine the value of FHLB stock due to restrictions
 placed on its transferability.                                                                                                                                                                                                                                                                                                                                                                  
| |                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |                                                                                                                                                               | Loans: The fair
 values of impaired loans are estimated as discussed previously. The fair
 values for all other loans are estimated using discounted cash flow analyses,
 using interest rates currently being offered for loans with similar terms to
 borrowers of similar credit rating. The Company has not considered market
 illiquidity in estimating the fair value of loans due to uncertain and
 inconsistent market pricing being experienced at measurement date.                                 
| |                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |                                                                                                                                                               | Accrued Interest:
 The fair value of accrued interest receivable and payable approximates
 carrying value.                                                                                                                                                                                                                                                                                                                                                                                                    
| |                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |                                                                                                                                                               | Deposits: The fair
 values of demand deposits (interest and non-interest checking) savings
 accounts and money market accounts are, by definition, equal to the amount
 payable on demand at the reporting date (i.e., their carrying amounts). Fair
 values for fixed-rate certificates of deposits are estimated using a
 discounted cash flow calculation that applies interest rates currently being
 offered on these products to a schedule of aggregated expected monthly
 maturities on time deposits.
| |                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |                                                                                                                                                               | Borrowings:Fair
 values of long-term borrowings are estimated using a discounted cash flow
 approach, based on current market rates for similar borrowings.                                                                                                                                                                                                                                                                                                                                                   
| |                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |                                                                                                                                                               | Off-balance-sheet instruments:
 Fair values for the Companys off-balance-sheet instruments (lines of credit
 and commitments to fund loans) are based on fees currently charged to enter
 into similar agreements, taking into account the remaining terms of the
 agreements and the counterparties credit standing. The fair value of these
 financial instruments is immaterial and has therefore been excluded from the
 table below.                                                                   
| |                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | The estimated carrying values and fair values of the Companys
 financial instruments for June 30, 2010 and December 31, 2009 are as follows
 (in thousands):

|                              |  |                  |         |                   |   |                  |  |             |         |  |   |         | 
|----------------------------- |  | ---------------- | ------- | ----------------- | - | ---------------- |  | ----------- | ------- |  | - | ------- | 
|                              |  | June 30, 2010    |         | December 31, 2009 |  
|                              |  |                  |         |                   |  
|                              |  | Carrying
 amount |         | Fair
 value       |   | Carrying
 amount |  | Fair
 value |        
|                              |  |                  |         |                   |   |                  |  |             |        
|Financial assets:             |  |                  |         |                   |   |                  |  |             |         |  |   |         | 
|Cash and cash equivalents     |  | $                | 9,305   |                   | $ | 9,305            |  | $           | 7,574   |  | $ | 7,574   | 
|Securities available for sale |  |                  | 12,629  |                   |   | 12,629           |  |             | 10,024  |  |   | 10,024  | 
|Securities held to maturity   |  |                  | 1,423   |                   |   | 1,489            |  |             | 1,431   |  |   | 1,502   | 
|Loans, net                    |  |                  | 280,498 |                   |   | 287,318          |  |             | 285,617 |  |   | 288,524 | 
|Accrued interest receivable   |  |                  | 1,138   |                   |   | 1,138            |  |             | 1,117   |  |   | 1,117   | 
|Financial liabilities:        |  |                  |         |                   |   |                  |  |             |         |  |   |         | 
|Non-interest bearing deposits |  |                  | 35,454  |                   |   | 35,454           |  |             | 31,790  |  |   | 31,790  | 
|Interest bearing deposits     |  |                  | 190,333 |                   |   | 190,612          |  |             | 184,849 |  |   | 185,320 | 
|Borrowings                    |  |                  | 37,618  |                   |   | 38,683           |  |             | 47,869  |  |   | 48,342  | 
|Accrued interest payable      |  |                  | 98      |                   |   | 98               |  |             | 127     |  |   | 127     | 

16

---



| |                                                                                                                                                                                                                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Fair value estimates are made at a specific point in time, based on
 relevant market information and information about the financial instrument.
 These estimates are subjective in nature and involve uncertainties and
 matters of significant judgment and, therefore, cannot be determined with
 precision. Changes in assumptions could significantly affect the estimates.

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. 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. Since
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-earning 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

17

---



among lenders, interest rate conditions and availability of funds. The Banks
operations and lending are principally concentrated in the Central New York
area, therefore its operations and earnings are influenced by the economics of
such area. 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 2010 increased to $694,000, from
the prior years second quarter net income of $647,000. The significant factors
and trends impacting the second quarter of 2010, which are discussed in greater
depth below, were as follows:

| |   |                                                                                                                                                                                                                                                                                                   
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | During the second quarter of 2010 the Company sold two investment
 securities, recording a gain on the sales of $121,000.                                                                                                                                                                         
| |  | Net interest income before loan loss provision increased by $204,000,
 or 6.3%, from the same quarter last year principally due to a decrease in
 interest expense stemming from decreases in the rates paid on deposits and
 borrowings, as well as a decrease in average outstanding borrowings.
| |  | The Company recorded a $415,000 provision for loan losses in the
 second quarter of 2010 versus a $200,000 provision for loan losses in the
 second quarter of 2009.                                                                                                                              
| |  | Other non-interest income increased by $27,000, or 4.3%, from the
 second quarter 2009 levels primarily due to higher customer fee revenue.                                                                                                                                                       
| |  | Non-interest expense increased by $50,000 to $2.8 million in the
 quarter ended June 30, 2010 from $2.7 million for the same period of 2009.                                                                                                                                                      
| |  | Income tax expense for the second quarter of 2010 increased to
 $345,000 compared to $305,000 in the second quarter of 2009, primarily due to
 higher pre-tax income.                                                                                                                             

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, the Company encourages the reader to review each of the
policies included in Note 2 to the consolidated financial statements reported
on the Companys 2009 Annual Report on Form 10-K to obtain a better
understanding of how its financial performance is reported.

Analysis of Net Interest Income

18

---



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, 2010      |         | For the
 three months ended June 30, 2009 |  
|                                                                  |  |                                                |         |                                           |  
|                                                                  |  | Average
 Balance                               |         | Interest
 Income/
 Expense                |   | Average
 Yield/
 Cost |   | AverageBalance |      | Interest
 Income/
 Expense |   | Average
 Yield/
 Cost | 
|                                                                  |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       | 
|                                                                  |  | (Dollars
 in thousands)                        |        
|                                                                  |  |                                                |        
|Assets:                                                           |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Interest-earning
 assets:                                         |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Loans                                                             |  | $                                              | 279,188 |                                           | $ | 4,026                 |   |                | 5.78 | %                          | $ | 289,805               |  | $ | 4,195 |   |  | 5.81 | %
|Securities (1)                                                    |  |                                                | 15,133  |                                           |   | 163                   |   |                | 4.33 |                            |   | 10,383                |  |   | 130   |   |  | 5.02 |  
|Federal funds
 sold & other interest bearing deposits             |  |                                                | 1,098   |                                           |   |                      |   |                | 0.10 |                            |   | 6,508                 |  |   | 3     |   |  | 0.18 |  
|                                                                  |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Total
 interest-earnings assets                                   |  |                                                | 295,419 |                                           |   | 4,189                 |   |                | 5.69 |                            |   | 306,696               |  |   | 4,328 |   |  | 5.66 |  
|Noninterest-earning
 assets                                       |  |                                                | 27,958  |                                           |   |                       |   |                |      |                            |   | 28,110                |  |   |       |   |  |      |  
|                                                                  |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Total assets                                                      |  | $                                              | 323,377 |                                           |   |                       |   |                |      |                            | $ | 334,806               |  |   |       |   |  |      |  
|                                                                  |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Liabilities
 and Shareholders Equity:                            |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Interest-bearing
 liabilities:                                    |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Savings accounts                                                  |  | $                                              | 85,118  |                                           | $ | 85                    |   |                | 0.40 |                            | $ | 83,405                |  | $ | 83    |   |  | 0.40 |  
|Time deposits                                                     |  |                                                | 71,591  |                                           |   | 322                   |   |                | 1.81 |                            |   | 72,713                |  |   | 488   |   |  | 2.69 |  
|Money market
 accounts                                            |  |                                                | 17,559  |                                           |   | 44                    |   |                | 1.00 |                            |   | 15,309                |  |   | 51    |   |  | 1.34 |  
|Other interest
 bearing deposits                                  |  |                                                | 14,909  |                                           |   | 14                    |   |                | 0.37 |                            |   | 13,876                |  |   | 13    |   |  | 0.38 |  
|                                                                  |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Total
 interest-bearing deposits                                  |  |                                                | 189,177 |                                           |   | 465                   |   |                | 0.99 |                            |   | 185,303               |  |   | 635   |   |  | 1.37 |  
|Borrowings                                                        |  |                                                | 37,135  |                                           |   | 289                   |   |                | 3.12 |                            |   | 54,677                |  |   | 459   |   |  | 3.37 |  
|                                                                  |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Total
 interest-bearing liabilities                               |  |                                                | 226,312 |                                           |   | 754                   |   |                | 1.34 |                            |   | 239,980               |  |   | 1,094 |   |  | 1.83 |  
|                                                                  |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Noninterest-bearing
 deposits                                     |  |                                                | 33,699  |                                           |   |                       |   |                |      |                            |   | 30,160                |  |   |       |   |  |      |  
|Other liabilities                                                 |  |                                                | 3,493   |                                           |   |                       |   |                |      |                            |   | 6,106                 |  |   |       |   |  |      |  
|                                                                  |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Total liabilities                                                 |  |                                                | 263,504 |                                           |   |                       |   |                |      |                            |   | 276,246               |  |   |       |   |  |      |  
|Shareholders
 equity                                             |  |                                                | 59,873  |                                           |   |                       |   |                |      |                            |   | 58,560                |  |   |       |   |  |      |  
|                                                                  |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Total liabilities
 and shareholders equity                       |  | $                                              | 323,377 |                                           |   |                       |   |                |      |                            | $ | 334,806               |  |   |       |   |  |      |  
|                                                                  |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Net interest
 income                                              |  |                                                |         |                                           |   | 3,435                 |   |                |      |                            |   |                       |  |   | 3,234 |   |  |      |  
|Tax equivalent
 adjustment on securities                          |  |                                                |         |                                           |   | (1                    | ) |                |      |                            |   |                       |  |   | (4    | ) |  |      |  
|                                                                  |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Net interest
 income per consolidated financial statements        |  |                                                |         |                                           | $ | 3,434                 |   |                |      |                            |   |                       |  | $ | 3,230 |   |  |      |  
|                                                                  |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|                                                                  |  |                                                |         |                                           |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Net interest rate
 spread                                         |  |                                                |         |                                           |   |                       |   |                | 4.35 | %                          |   |                       |  |   |       |   |  | 3.83 | %
|Net interest
 margin                                              |  |                                                |         |                                           |   |                       |   |                | 4.66 | %                          |   |                       |  |   |       |   |  | 4.23 | %
|Ratio of
 interest-earning assets to interest-bearing liabilities |  |                                                |         |                                           |   |                       |   |                | 1.31 | x                          |   |                       |  |   |       |   |  | 1.28 | x

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

19

---



|                                                                  |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|----------------------------------------------------------------- |  | ---------------------------------------------- | ------- | --------------------------------------- | - | --------------------- | - | -------------- | ---- | -------------------------- | - | --------------------- |  | - | ----- | - |  | ---- | -
|                                                                  |  | Average
 Balances, Interest and Average Yields |        
|                                                                  |  |                                                |        
|                                                                  |  | For the
 six months ended June 30, 2010        |         | For the
 six months ended June 30, 2009 |  
|                                                                  |  |                                                |         |                                         |  
|                                                                  |  | Average
 Balance                               |         | Interest
 Income/
 Expense              |   | Average
 Yield/
 Cost |   | AverageBalance |      | Interest
 Income/
 Expense |   | Average
 Yield/
 Cost | 
|                                                                  |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       | 
|                                                                  |  | (Dollars
 in thousands)                        |        
|                                                                  |  |                                                |        
|Assets:                                                           |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Interest-earning
 assets:                                         |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Loans                                                             |  | $                                              | 283,800 |                                         | $ | 8,118                 |   |                | 5.77 | %                          | $ | 292,922               |  | $ | 8,477 |   |  | 5.84 | %
|Securities (1)                                                    |  |                                                | 14,837  |                                         |   | 334                   |   |                | 4.54 |                            |   | 9,323                 |  |   | 213   |   |  | 4.60 |  
|Federal funds
 sold & other interest bearing deposits             |  |                                                | 815     |                                         |   |                      |   |                | 0.10 |                            |   | 4,477                 |  |   | 5     |   |  | 0.21 |  
|                                                                  |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Total interest-earnings
 assets                                   |  |                                                | 299,452 |                                         |   | 8,452                 |   |                | 5.69 |                            |   | 306,722               |  |   | 8,695 |   |  | 5.72 |  
|Noninterest-earning
 assets                                       |  |                                                | 27,696  |                                         |   |                       |   |                |      |                            |   | 27,737                |  |   |       |   |  |      |  
|                                                                  |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Total assets                                                      |  | $                                              | 327,148 |                                         |   |                       |   |                |      |                            | $ | 334,459               |  |   |       |   |  |      |  
|                                                                  |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Liabilities
 and Shareholders Equity:                            |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Interest-bearing
 liabilities:                                    |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Savings accounts                                                  |  | $                                              | 84,158  |                                         | $ | 167                   |   |                | 0.40 |                            | $ | 81,765                |  | $ | 163   |   |  | 0.40 |  
|Time deposits                                                     |  |                                                | 71,686  |                                         |   | 664                   |   |                | 1.87 |                            |   | 72,536                |  |   | 1,024 |   |  | 2.85 |  
|Money market
 accounts                                            |  |                                                | 17,087  |                                         |   | 86                    |   |                | 1.01 |                            |   | 14,390                |  |   | 100   |   |  | 1.39 |  
|Other interest
 bearing deposits                                  |  |                                                | 14,676  |                                         |   | 28                    |   |                | 0.38 |                            |   | 13,628                |  |   | 26    |   |  | 0.39 |  
|                                                                  |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Total
 interest-bearing deposits                                  |  |                                                | 187,607 |                                         |   | 945                   |   |                | 1.02 |                            |   | 182,319               |  |   | 1,313 |   |  | 1.45 |  
|Borrowings                                                        |  |                                                | 40,909  |                                         |   | 602                   |   |                | 2.97 |                            |   | 56,952                |  |   | 894   |   |  | 3.16 |  
|                                                                  |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Total
 interest-bearing liabilities                               |  |                                                | 228,516 |                                         |   | 1,547                 |   |                | 1.37 |                            |   | 239,271               |  |   | 2,207 |   |  | 1.86 |  
|                                                                  |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Noninterest-bearing
 deposits                                     |  |                                                | 32,336  |                                         |   |                       |   |                |      |                            |   | 29,783                |  |   |       |   |  |      |  
|Other liabilities                                                 |  |                                                | 6,097   |                                         |   |                       |   |                |      |                            |   | 6,217                 |  |   |       |   |  |      |  
|                                                                  |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Total liabilities                                                 |  |                                                | 266,949 |                                         |   |                       |   |                |      |                            |   | 275,271               |  |   |       |   |  |      |  
|Shareholders
 equity                                             |  |                                                | 60,199  |                                         |   |                       |   |                |      |                            |   | 59,188                |  |   |       |   |  |      |  
|                                                                  |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Total liabilities
 and shareholders equity                       |  | $                                              | 327,148 |                                         |   |                       |   |                |      |                            | $ | 334,459               |  |   |       |   |  |      |  
|                                                                  |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Net interest
 income                                              |  |                                                |         |                                         |   | 6,905                 |   |                |      |                            |   |                       |  |   | 6,488 |   |  |      |  
|Tax equivalent
 adjustment on securities                          |  |                                                |         |                                         |   | (4                    | ) |                |      |                            |   |                       |  |   | (8    | ) |  |      |  
|                                                                  |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Net interest
 income per consolidated financial statements        |  |                                                |         |                                         | $ | 6,901                 |   |                |      |                            |   |                       |  | $ | 6,480 |   |  |      |  
|                                                                  |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|                                                                  |  |                                                |         |                                         |   |                       |   |                |      |                            |   |                       |  |   |       |   |  |      |  
|Net interest rate
 spread                                         |  |                                                |         |                                         |   |                       |   |                | 4.32 | %                          |   |                       |  |   |       |   |  | 3.86 | %
|Net interest
 margin                                              |  |                                                |         |                                         |   |                       |   |                | 4.65 | %                          |   |                       |  |   |       |   |  | 4.27 | %
|Ratio of
 interest-earning assets to interest-bearing liabilities |  |                                                |         |                                         |   |                       |   |                | 1.31 | x                          |   |                       |  |   |       |   |  | 1.28 | x

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

20

---



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.

|                                                                                           |  |                                                                                 |      |                                                                             |   |      |   |      |      |        |   |      |   |   |      |   |   |      |  
|------------------------------------------------------------------------------------------ |  | ------------------------------------------------------------------------------- | ---- | --------------------------------------------------------------------------- | - | ---- | - | ---- | ---- | ------ | - | ---- | - | - | ---- | - | - | ---- | -
|                                                                                           |  | Three months ended June 30, 2010 Compared 
 to Three months ended June 30, 2009 |      | Six months ended June 30, 2010 Compared 
 to Six months ended June 30, 2009 |  
|                                                                                           |  |                                                                                 |      |                                                                             |  
|                                                                                           |  | Increases (decreases) due to                                                    |      | Increases (decreases) due to                                                |  
|                                                                                           |  | Rate                                                                            |      | Volume                                                                      |   | Net  |   | Rate |      | Volume |   | Net  |  
|                                                                                           |  |                                                                                 |      |                                                                             |   |      |   |      |      |        |   |      |  
|                                                                                           |  | (in thousands)                                                                  |     
|Assets:                                                                                    |  |                                                                                 |      |                                                                             |   |      |   |      |      |        |   |      |   |   |      |   |   |      |  
|Interest-earning
 assets:                                                                  |  |                                                                                 |      |                                                                             |   |      |   |      |      |        |   |      |   |   |      |   |   |      |  
|Loans                                                                                      |  | $                                                                               | (17  | )                                                                           | $ | (152 | ) | $    | (169 | )      | $ | (97  | ) | $ | (262 | ) | $ | (359 | )
|Securities (1)                                                                             |  |                                                                                 | (26  | )                                                                           |   | 59   |   |      | 33   |        |   | (4   | ) |   | 125  |   |   | 121  |  
|Federal funds sold & other                                                                 |  |                                                                                 |      |                                                                             |   |      |   |      |      |        |   |      |   |   |      |   |   |      |  
|Interest bearing deposits                                                                  |  |                                                                                 |     |                                                                             |   | (3   | ) |      | (3   | )      |   |     |   |   | (5   | ) |   | (5   | )
|                                                                                           |  |                                                                                 |      |                                                                             |   |      |   |      |      |        |   |      |   |   |      |   |   |      |  
|Total interest-earnings assets                                                             |  |                                                                                 | (43  | )                                                                           |   | (96  | ) |      | (139 | )      |   | (101 | ) |   | (142 | ) |   | (243 | )
|                                                                                           |  |                                                                                 |      |                                                                             |   |      |   |      |      |        |   |      |   |   |      |   |   |      |  
|Interest-bearing
 liabilities:                                                             |  |                                                                                 |      |                                                                             |   |      |   |      |      |        |   |      |   |   |      |   |   |      |  
|Savings accounts                                                                           |  |                                                                                 |     |                                                                             |   | 2    |   |      | 2    |        |   |     |   |   | 4    |   |   | 4    |  
|Time deposits                                                                              |  |                                                                                 | (158 | )                                                                           |   | (8   | ) |      | (166 | )      |   | (348 | ) |   | (12  | ) |   | (360 | )
|Money market accounts                                                                      |  |                                                                                 | (14  | )                                                                           |   | 7    |   |      | (7   | )      |   | (33  | ) |   | 19   |   |   | (14  | )
|Other interest bearing deposits                                                            |  |                                                                                 |     |                                                                             |   | 1    |   |      | 1    |        |   |     |   |   | 2    |   |   | 2    |  
|                                                                                           |  |                                                                                 |      |                                                                             |   |      |   |      |      |        |   |      |   |   |      |   |   |      |  
|Total interest-bearing deposits                                                            |  |                                                                                 | (172 | )                                                                           |   | 2    |   |      | (170 | )      |   | (381 | ) |   | 13   |   |   | (368 | )
|Borrowings                                                                                 |  |                                                                                 | (23  | )                                                                           |   | (147 | ) |      | (170 | )      |   | (40  | ) |   | (252 | ) |   | (292 | )
|                                                                                           |  |                                                                                 |      |                                                                             |   |      |   |      |      |        |   |      |   |   |      |   |   |      |  
|Total interest-bearing liabilities                                                         |  |                                                                                 | (195 | )                                                                           |   | (145 | ) |      | (340 | )      |   | (421 | ) |   | (239 | ) |   | (660 | )
|                                                                                           |  |                                                                                 |      |                                                                             |   |      |   |      |      |        |   |      |   |   |      |   |   |      |  
|Net
 change (1)                                                                            |  | $                                                                               | 152  |                                                                             | $ | 49   |   | $    | 201  |        | $ | 320  |   | $ | 97   |   | $ | 417  |  
|                                                                                           |  |                                                                                 |      |                                                                             |   |      |   |      |      |        |   |      |   |   |      |   |   |      |  
|                                                                                           |  |                                                                                 |      |                                                                             |   |      |   |      |      |        |   |      |   |   |      |   |   |      |  
|(1)
 Includes tax equivalent adjustment for the Companys tax-exempt municipal securities. | 

Comparison of
Financial Condition at June 30, 2010 and December 31, 2009:

Total
assets at June 30, 2010 remained stable at $329.6 million compared to $329.9
million at December 31, 2009. The Companys net loan portfolio decreased by
$5.1 million, or 1.7%, from $285.6 million at December 31, 2009 to $280.5
million at June 30, 2010. During the first six months of 2010, the Company
originated approximately $24.1 million of loans, compared to approximately
$25.5 million of loans originated in the same period of 2009.

The
continued uncertainty in the United States investment markets has encouraged
investors to favor the security of insured deposit accounts. Total deposits
increased to $225.8 million at June 30, 2010 from $216.6 million at December
31, 2009. During the first half of 2010, savings deposits increased by $3.7
million, or 4.5%, and money market balances increased by $2.0 million, or
12.4%. Time deposits decreased by $791,000, or 1.1%, to $71.1 million at June
30, 2010 from $71.9 million at year end 2009. Balances of non-interest bearing
deposits increased by $3.7 million, or 11.5%, while other interest bearing
deposits increased by $620,000, or 4.1%, over the first half of 2010.

As a result
of increased loan sale activity and increases in deposit balances, the Company
continued to pay down debt during the first six months of 2010. Borrowings from
the Federal Home Loan Bank of New

21

---



York (FHLB) decreased from $47.9 million at December 31, 2009 to
$37.6 million at the end of the current quarter.

Comparison of
Operating Results for the Three-Month Periods Ended June 30, 2010 and 2009

General

During the
three months ended June 30, 2010, the Company recorded net income of $694,000,
compared to $647,000 for the second quarter of 2009. The increase in net income
is comprised of an increase in net interest income before the provision for
loan losses of $204,000 and an increase in non-interest income of $148,000
partially offset by an increase the provision for loan losses of $215,000, an
increase in non-interest expense of $50,000 and an increase in income tax
expense of $40,000.

Diluted
earnings per share increased to $0.11 per diluted share for the quarter ended
June 30, 2010 from $0.10 per diluted share in the quarter ended June 30, 2009.
Average diluted shares decreased to 6,514,658 for the second quarter of 2010
from 6,570,763 in the same period of 2009 due to the Companys stock repurchases
over the past year.

Net Interest Income

Net
interest income before loan loss provision for the quarter ended June 30, 2010
increased by $204,000, or 6.3%, compared to the same quarter of 2009. This
increase is primarily attributable to a decrease in interest expense due to
lower rates paid on interest bearing liabilities, partially off set by a
decrease in interest income due to a decrease in the average balance of loans
outstanding.

Interest Income

Interest
income decreased to $4.2 million for the quarter ended June 30, 2010 from $4.3
million for the same quarter of 2009. Average loan balances for the second
quarter of 2010 were $279.2 million, a decrease of $10.6 million from the
average outstanding loans for the second quarter of 2009 as a result of
continued sales of residential loan originations into the secondary market. The
yield on the Companys loan portfolio for the quarter ended June 30, 2010
decreased to 5.78% from a yield of 5.81% for the same period last year. Interest
income on securities increased by $36,000 from $126,000 for the quarter ended
June 30, 2009 to $162,000 for the quarter ended June 30, 2010. The average
balance of securities increased by $4.7 million, or 45.7%, from the second
quarter of 2009 to $15.1 million for the current quarter while the tax
equivalent yield on the Companys securities decreased to 4.33% from 5.02%.
During the second quarter of 2010, the average balance of the Companys federal
funds sold and interest bearing deposits was minimal, resulting in a reduction
of interest income on these assets of $3,000.

Interest Expense

Interest
expense decreased to $754,000 for the quarter ended June 30, 2010 from $1.1
million for the same quarter of 2009. Interest expense on deposits decreased to
$465,000 for the quarter ended June 30, 2010 from $635,000 for the quarter
ended June 30, 2009, due to lower rates paid on deposits consistent with market
trends over the past year. This was partially offset by an increase in the
average balance of interest-bearing deposits to $189.2 million for the quarter
ended June 30, 2010, from $185.3 million for the same period of 2009. Interest
expense on borrowed funds decreased to $289,000 for the quarter ended June 30,
2010 from $459,000 for the comparative quarter of 2009 due to a decrease in
both the average balances of borrowings and their interest rates in 2010. The
average balance of borrowings decreased to $37.1 million in the current quarter
compared to $54.7 million in the first quarter of 2009. Cash received from
increased customer deposits and loan sales were utilized to repay borrowings as
they matured. The rate on the Companys borrowings decreased to 3.12% during
the second quarter of 2010 from 3.37% in the same quarter of 2009 as the Company
repaid some of its longer maturity advances during the first quarter of 2010.

22

---



Provision for Loan
Losses

The Company
recorded a $415,000 provision for loan losses in the second quarter of 2010,
compared to a $200,000 loan loss provision in the same period of 2009. The
additional provision was deemed necessary to cover an estimated decrease in
collateral value on a commercial credit and an increase in the Companys level
of non-performing loans. Included in the Companys classified assets at June
30, 2010 is a loan relationship comprised of three loans to the same borrower,
which are part of a larger loan participation arrangement with other banks. The
Companys portion of the arrangement totaled $4.6 million at June 30, 2010. The
loans are secured by first and second mortgages on property held for
development and several other unrelated properties. Due to the current economic
climate, the borrower has been unable to develop the commercial real estate for
sale in a timely fashion. This commercial credit was performing in accordance
with contractual terms as of June 30, 2010 and was therefore accruing interest
as of such date. However, management is uncertain as to the current and
continued sources of debt service. Accordingly the Company has designated one
of the loans as impaired. The loss related to this relationship could change if
new information becomes available in future periods. Management is actively
monitoring this credit and its associated collateral value. At June 30, 2010,
non-performing loans as a percent of loans increased to 0.85% compared to 0.67%
at December 31, 2009. Over the same six month period, the allowance for loan
losses as a percent of non-performing loans decreased to 104.6% from 111.4%.
The majority of the increase in non-performing loans is in the single family
residential loan portfolio, which management believes to be adequately
collateralized. The allowance for loan losses as a percentage of loans
increased to 0.89% at June 30, 2010 compared to 0.74% at December 31, 2009.

As
described in Note 5 of the Notes to the Consolidated Financial Statements, the
Company has in place procedures to identify and monitor potential problem
loans. The Company regularly reviews problem loans and other assets in its
portfolio to determine whether any require classification in accordance with
the Companys policy and applicable regulations. 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 increased by $148,000 to $783,000 in the second quarter of 2010 from
$635,000 in the same period of 2009, largely due to $121,000 of gains realized
on the sale of two investment securities. The Company recorded no securities
sales in the second quarter of 2009. The remainder of the increase in
non-interest income is primarily attributable to higher levels of customer fee
revenue.

Non-interest
expense slightly increased by $50,000 to $2.7 million in the second quarter of
2010 from $2.6 million in the same quarter of 2009, due to routine cost
increases. Income tax expense for the second quarter of 2010 increased to
$459,000 from $305,000 in the same period of 2009, primarily due to the
increase in pre-tax income.

Comparison of
Operating Results for the Six-Month Periods Ended June 30, 2009 and 2008

General

During the
six months ended June 30, 2010, the Company recorded net income of $1.8 million
compared to $1.4 million for the first half of 2009. The increase resulted from
an increase in net interest income before the provision for loan losses of
$421,000, an increase in non-interest income of $596,000 and a decrease in
non-interest expense of $46,000 partially offset by a $265,000 increase in the
provision for loan losses and a $311,000 increase in income tax expense.

23

---



Diluted
earnings per share increased to $0.28 per diluted share for the six months
ended June 30, 2010 in comparison to $0.20 per diluted share for the same
period of 2009. The year-to-date 2010 average outstanding diluted shares
decreased to 6,517,214 from 6,617,995 due to ongoing treasury stock purchases.

Net Interest Income

Net
interest income before loan loss provision for the six months ended June 30,
2010 increased by $421,000 or 6.5%, as compared to the same period of 2009.
This increase is attributable to a decrease in the average balance of
borrowings and rates paid on deposits and borrowings, partially offset by a
reduction in the average balances of and yields earned on assets.

Interest Income

Interest
income decreased to $8.4 million for the six month period ended June 30, 2010
from $8.7 million for the first half of 2009. Average earning assets for the
first half of 2010 decreased to $299.5 million from $306.7 million in the same
period of 2009. This reduction is due to the sale of a substantial portion of
the Companys new residential loans into the secondary market over the past
year. The yield on earning assets decreased slightly to 5.69% for the six
months ended June 30, 2010, from 5.72% for the first half of 2009. Average loan
balances for the first six months of 2010 were $283.8 million, a decrease of
$9.1 million from the average outstanding loans for the same period of 2009.
The yield on the Companys loan portfolio for the six months ended June 30,
2010 was 5.77% compared to a yield of 5.84% for the same period last year.
Interest income on securities increased $125,000 from $205,000 for the six
months ended June 30, 2009 to $330,000 for the six months ended June 30, 2010
as the average balance of the investment portfolio increased to $14.8 million
for the first half of 2010 from $9.3 million during the same half of 2009.
Finally, interest income on federal funds sold and other interest bearing
deposits decreased by $5,000 to $0 for the first half of 2010 from the same
period in 2009 due to decreases in average balances of these funds.

Interest Expense

Interest
expense decreased to $1.5 million for the six months ended June 30, 2010 from
$2.2 million for the six months ended June 30, 2009. Interest expense on
deposits decreased to $945,000 for the six months ended June 30, 2010 from $1.3
million for the six months ended June 30, 2009 as a result of a decrease in the
cost of these deposits from 1.45% to 1.02% partially offset by an increase in
the average balance of deposits to $187.6 million this year from $182.3 million
during the first half of 2009. Interest expense on borrowed funds decreased to
$602,000 for the six months ended June 30, 2010 from $894,000 for the
comparative period of 2009 primarily due to a decrease in the average balance
of borrowings to $40.9 million in the current half as compared to $57.0 million
in the six months ended June 30, 2009. Deposit growth and proceeds of loan
sales have been used to pay down advances upon their maturity. The rate paid on
these borrowings decreased from 3.16% for the six months ended June 30, 2009 to
2.97% for the same period this year.

Provision for Loan
Losses

The Company
recorded a $465,000 provision for loan losses in the first half of 2010 versus
a $200,000 provision in the first six months of 2009. The 2010 year to date
provision was recorded to provide for decline in value of collateral for a
commercial loan and an increase in non-performing loans. The Companys ratio of
non-performing loans to total loans increased to 0.85% at June 30, 2010, from
0.67% at the previous year end. The majority of the Companys non-performing
loans are in the single family residential loan portfolio which management
believes is well collateralized. The 2009 provision was deemed necessary due to
managements judgment that one of its commercial borrowers may be experiencing
financial difficulties, despite that borrowers current ability to service its
loans. The Companys loss experience for the first six months of 2010

24

---



remains favorable with year to date net loan charge-offs of $74,000,
compared to $31,000 for the same period of 2009.

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 increased to $1.8 million for the first half of 2010 from $1.2 million
for the first six months of both 2009. The increase is attributable to gains on
sales of real estate and securities and an increase in fee revenue. In the
first quarter of 2010, the Company sold a parcel of non-operating commercial real
estate, realizing a gain of $418,000. During the second quarter of 2010, the
Company recorded gains of $121,000 on the sales of two investment securities.

Non-interest
expense decreased to $5.4 million in the first six months of 2010 compared to
$5.5 million in the same period of 2009, principally due to the 2009 FDIC
mandated industry-wide special assessment which was charged to member banks to
replenish the insurance fund.

Income tax
expense for the first half of 2010 increased to $948,000 from $637,000 in the
same period of 2009, in relation to the increase in pre-tax income.

Liquidity and Capital
Resources

The
Companys primary sources of funds consist of deposits, scheduled amortization
and prepayments of loans, maturities of investments, interest-bearing deposits
at other financial institutions and funds provided from operations. The Bank
also has a written agreement with the FHLB that allows it to borrow up to $44.1
million. At June 30, 2010, the Bank had no outstanding borrowings against this
line of credit, and outstanding advances and amortizing notes totaling $37.6
million. At June 30, 2010, the Company also had approximately $8.5 million in
unused short term borrowing capacity at the Federal Reserve Bank of New York,
which is collateralized by a portion of the consumer loan portfolio.

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, 2010, the Company originated loans of approximately $24.1 million, compared
to $25.5 million of loans in the same period of 2009. For the past several
quarters, the Company has been selling a large percentage of its residential
loan originations into the secondary market. Loan sales through six months of
2010 were $6.2 million, compared to $5.1 million for the first half of 2009.
These loans are sold with the Company retaining the servicing for the
purchasers. Year to date 2010 security purchases were $4.5 million compared to
$4.3 million for the same period of 2009.

At June 30,
2010, the Company had loan commitments to borrowers of approximately $9.0
million, and available letters and lines of credit of approximately $18.2
million.

Time
deposit accounts scheduled to mature within one year were $51.6 million at June
30, 2010. Based on the Companys deposit retention experience and current
pricing strategy, the Company anticipates that a significant portion of these
time deposits will remain with the Company. The Company is committed to
maintaining a strong liquidity position; therefore, the Company monitors its
liquidity position on a daily basis.

25

---



The Company anticipates that the Company will have sufficient funds to
meet the Companys current funding commitments. The marginal cost of new
funding however, whether from deposits or borrowings from the FHLB, will be
carefully considered as the Company monitors its liquidity needs. Therefore, in
order to minimize its cost of funds, the Company may consider additional
borrowings from the FHLB in the future.

At June 30,
2010, the Bank exceeded each of the applicable regulatory capital requirements.
The Banks leverage (Tier 1) capital at June 30, 2010 was $56.2 million, or
16.96% 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 $16.6
million, or 5.0% of adjusted assets. To be classified as a well-capitalized
bank by the OTS, the Bank must also have a Tier 1 risk-based capital ratio of
6% and a total risk-based capital ratio of 10.0%. At June 30, 2010, the Bank
had a Tier 1 risk-based capital ratio of 23.08% and a total risk-based capital
ratio of 24.10%.

The Company
paid cash dividends of $0.18 per share during the six months ended June 30,
2010 totaling $1,173,000.

During the
first six months of 2010, $201,000 was expended to repurchase 22,568 shares of
the Companys common stock.

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.

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, 2009. 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 2009 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 the 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 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.

26

---



Part II - OTHER INFORMATION

|         |                  
|-------- | -----------------
|Item 1.  | Legal Proceedings
|         |                  
|         | None.            
|         |                  
|Item 1A. | Risk Factors     

The
recent adoption of regulatory reform legislation may have a material effect on
our operations and capital requirements.

On July 21,
2010, President Obama signed into law the Dodd-Frank Wall Street Reform and
Consumer Protection Act (the Reform Act). The Reform Act is intended to
address perceived weaknesses in the U.S. financial regulatory system and to
prevent future economic and financial crises. There are many provisions of the
Reform Act which are to be implemented through regulations to be adopted by the
federal bank regulatory agencies within specified time frames following the
effective date of the Reform Act, which creates a risk of uncertainty as to the
effect that such provisions will ultimately have. We do not believe that the
Reform Act will have a material impact on our core operations. However, we
believe the following provisions of the Reform Act will have an impact on us,
though it is not possible for us to determine at this time whether and to what
extent the Reform Act will have a material effect on our business, financial condition
or results of operations:

|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | New Regulatory Regime. On July 21, 2011,
 unless the Secretary of the Treasury opts to delay such date for up to an
 additional six months, the OTS will be eliminated and the OCC will take over
 the regulation of all federal savings associations, such as Rome Bancorp. The
 FRB will acquire the OTSs authority over all savings and loan holding
 companies, such as Rome Bancorp, and will also become the supervisor of all
 subsidiaries of savings and loan holding companies other than depository
 institutions. As a result, we will now be subject to regulation, supervision
 and examination by two federal banking agencies, the OCC and the FRB, rather
 than just by the OTS, as is currently the case. The Reform Act also provides
 for the creation of the Bureau of Consumer Financial Protection, or the CFPB.
 Although the CFPB will have only limited supervisory authority over
 institutions with less than $10 billion in assets, such as Rome Bancorp,
 Inc., the establishment of the CFPB could result in more stringent consumer
 protection regulations than those imposed by bank regulatory agencies
 previously.
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | Consolidated Holding Company Capital Requirements.
 The Reform Act requires the federal banking agencies to establish
 consolidated risk-based and leverage capital requirements for insured
 depository institutions, depository institution holding companies and
 systemically important nonbank financial companies. These requirements must
 be no less than those to which insured depository institutions are currently
 subject, and the new requirements will effectively eliminate the use of trust
 preferred securities as a component of Tier 1 capital for depository
 institution holding companies of our size. As a result, on the fifth
 anniversary of the effective date of the Reform Act, we will become subject
 to consolidated capital requirements to which we have not been subject to
 previously.                                                                                                                                                                                                                                                                                                                          
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | Roll Back of Federal Preemption. The Reform
 Act significantly rolls back the federal preemption of state consumer
 protection laws that is currently enjoyed by federal savings associations and
 national banks by (i) requiring that a state consumer financial law prevent
 or significantly interfere with the exercise of a federal savings
 associations or national banks powers before it can be preempted, (ii)
 mandating that any preemption decision be made on a case by case basis rather
 than a blanket rule and (iii) ending the applicability of preemption to
 subsidiaries and affiliates of national banks and federal savings associations.
 As a result, we may now be subject to state consumer protection laws in each
 state where we do business, and those laws may be interpreted and enforced
 differently in different states.                                                                                                                                                                                                                                                                                        

The Reform
Act also includes provisions, subject to further rulemaking by the federal bank
regulatory agencies, that may affect our future operations, including
provisions that create minimum standards for the origination of mortgages,
restrict proprietary trading by banking entities, restrict the sponsorship of
and

27

---



investment in hedge funds and private equity funds by banking entities
and that remove certain obstacles to the conversion of savings associations to
national banks. We will not be able to determine the impact of these provisions
until final rules are promulgated to implement these provisions and other
regulatory guidance is provided interpreting these provisions.

|        |                                                             
|------- | ------------------------------------------------------------
|Item 2. | Unregistered Sales of Equity Securities and
 Use of Proceeds

The
following table provides information with respect to purchases made by or on
behalf of the Company or any affiliated purchases (as defined in Rule 106-18
(a)(3) under the Securities Exchange Act of 1934) of the Companys common stock
during the quarter ended June 30, 2010.

COMPANY PURCHASES OF
EQUITY SECURITIES

|                                     |  |                                                     |       |                                               |   |                                                                                                         |  |                                                                                                                                             |       |  |  |         | 
|------------------------------------ |  | --------------------------------------------------- | ----- | --------------------------------------------- | - | ------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------- | ----- |  |  | ------- | 
|Period                               |  | (a) Total Number 
 of Shares (or 
 Units) Purchased |       | (b) Average Price 
 Paid per Share
 (or Unit) |   | (c) Total Number of 
 Shares (or Units) 
 Purchased as Part of 
 Publicly Announced 
 Plans or Programs |  | (d) Maximum 
 Number (or 
 Approximate 
 Dollar Value) of 
 Shares (or Units) 
 that may yet be 
 Purchased under 
 the Plans or 
 Programs |      
|                                     |  |                                                     |       |                                               |   |                                                                                                         |  |                                                                                                                                             |      
|April 1, 2010 through April 30, 2010 |  |                                                     | 3,200 |                                               | $ | 8.64                                                                                                    |  |                                                                                                                                             | 3,200 |  |  | 194,962 | 
|May 1, 2010 through May 31, 2010     |  |                                                     | 3,700 |                                               | $ | 9.03                                                                                                    |  |                                                                                                                                             | 3,700 |  |  | 191,262 | 
|June 1, 2010 through June 30, 2010   |  |                                                     | 1,368 |                                               | $ | 9.01                                                                                                    |  |                                                                                                                                             | 1,368 |  |  | 189,894 | 
|Total                                |  |                                                     | 8,268 |                                               | $ | 8.88                                                                                                    |  |                                                                                                                                             | 8,268 |  |  | 189,894 | 

|        |                                                     
|------- | ----------------------------------------------------
|Item 3. | Defaults Upon Senior Securities                     
|        | None.                                               
|        |                                                     
|Item 4. | Submission of Matters to a Vote of Security
 Holders
|        |                                                     
|        | None.                                               
|        |                                                     
|Item 5. | Other Information                                   
|        |                                                     
|        | None.                                               

28

---



|        |         
|------- | --------
|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  | Amended and restated form
 of One Year Change in Control Agreement by and among certain officers and
 Rome Bancorp, Inc. and The Rome Savings Bank. (8)
|10.6  | Amended and restated form
 of Employment Agreement between New Rome Bancorp, Inc. and Charles M. Sprock.
 (8)                                          
|10.7  | Amended and restated form
 of Employment Agreement between The Rome Savings Bank and Charles M. Sprock.
 (8)                                           
|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
 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 Form S-8 filed with the Commission on
 May 19, 2006, as amended.                                         
|    |                                                                                                                                                              | 
|(8) | Incorporated
 by reference to Rome Bancorp, Inc.s Form 8-K filed with the Commission on
 December 3, 2007.                                                 

29

---



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.

ROME BANCORP, INC.

|                         |  |                                                                                              |  |                 | 
|------------------------ |  | -------------------------------------------------------------------------------------------- |  | --------------- | 
|Name                     |  | Title                                                                                        |  | Date            | 
|                         |  |                                                                                              |  |                 | 
|                         |  |                                                                                              |  |                 | 
|/s/Charles
 M. Sprock    |  | Chairman of
 the Board, President and Chief Executive Officer (Principal Executive
 Officer) |  | August 13, 2010 | 
|                         |  |                                                                                              |  |                
|Charles M.
 Sprock       |  |                                                                                              |  |                
|                         |  |                                                                                              |  |                 | 
|/s/David C.
 Nolan       |  | Executive
 Vice President and Chief Financial Officer (Principal Financial Officer)          |  | August 13, 2010 | 
|                         |  |                                                                                              |  |                
|David C.
 Nolan          |  |                                                                                              |  |                
|                         |  |                                                                                              |  |                 | 
|/s/Mary
 Faith Messenger |  | Vice
 President and Controller (Principal Accounting Officer)                                |  | August 13, 2010 | 
|                         |  |                                                                                              |  |                
|Mary Faith
 Messenger    |  |                                                                                              |  |                

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