NORTHFIELD BANCORP INC
SB-2, 1998-03-25
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<PAGE>
 
    As filed with the Securities and Exchange Commission on March 25, 1998

                                                      Registration No. 333-_____
================================================================================
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C.  20549
                               _________________
                                   FORM SB-2
                            REGISTRATION STATEMENT
                                     UNDER
                          THE SECURITIES ACT OF 1933
                               _________________

                           NORTHFIELD BANCORP, INC.
                (Name of Small Business Issuer in its charter)
 
<TABLE> 
<CAPTION> 
         MARYLAND                          6035                        [APPLIED FOR]
- ------------------------------------------------------------------------------------------
<S>                                  <C>                            <C> 
    (State or other jurisdiction    (Primary standard industrial    (I.R.S. employer      
of incorporation or organization)   classification code number)     identification number) 
</TABLE>

                               8005 HARFORD ROAD
                          BALTIMORE, MARYLAND  21234
                                (410) 665-7900
- --------------------------------------------------------------------------------
(Address and telephone number of principal executive offices and principal place
                                 of business)

                          G. RONALD JOBSON, PRESIDENT
                          AND CHIEF EXECUTIVE OFFICER
                           NORTHFIELD BANCORP, INC.
                               8005 HARFORD ROAD
                          BALTIMORE, MARYLAND  21234
                                (410) 665-7900
- --------------------------------------------------------------------------------
           (Name, address and telephone number of agent for service)

                                  COPIES TO:
                          Gary R. Bronstein, Esquire
                           Cynthia R. Cross, Esquire
                      Housley Kantarian & Bronstein, P.C.
                       1220 19th Street, N.W., Suite 700
                            Washington, D.C.  20036

     APPROXIMATE DATE OF PROPOSED SALE TO THE PUBLIC:  As soon as practicable
after this registration statement becomes effective.

If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [_] ___________

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_] _________

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_] _________

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box.  [_]

                        CALCULATION OF REGISTRATION FEE
<TABLE> 
<CAPTION> 
================================================================================================
 Title of Each Class     Dollar       Proposed Maximum   Proposed Maximum
of Securities To Be     Amount To       Offering Price      Aggregate            Amount Of
  Registered          Be Registered       Per Share      Offering Price (1)   Registration Fee
- ------------------------------------------------------------------------------------------------
<S>                   <C>             <C>                <C>                  <C> 
Common Stock, $.01
 par value              $6,129,790          $10.00          $6,129,790           $1,808.29
================================================================================================
</TABLE>

(1)  Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(d).

     THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
<PAGE>
 
PROSPECTUS
Up to 595,125 Shares of Common Stock

                    NORTHFIELD BANCORP, INC.

                    Executive Offices:                 Main Office:
                    8005 Harford Road                  1844 E. Joppa Road
                    Baltimore, Maryland 21234          Baltimore, Maryland 21234
                    (410) 665-7900                     (410) 663-2500
================================================================================

     Northfield Federal Savings is converting from a federally chartered mutual
savings association to a federally chartered stock savings bank.  As part of the
conversion, Northfield Federal Savings will become a wholly owned subsidiary of
Northfield Bancorp, Inc. and will adopt the name "Northfield Federal Saving
Bank."  The Company was formed in March 1998 and upon completion of the
conversion will own all of the shares of Northfield Federal Savings. The common
stock of the Company is being offered to the public in accordance with a plan of
conversion.  The plan of conversion must be approved by the Office of Thrift
Supervision and by a majority of the votes eligible to be cast by members of
Northfield Federal Savings.  The offering will not go forward if Northfield
Federal Savings does not receive these approvals and the Company does not sell
at least the minimum number of shares.

     The shares of common stock are first being offered pursuant to
nontransferable subscription rights in a Subscription Offering.  Depositor and
borrower members as of certain eligibility dates will receive subscription
rights. Shares of common stock not subscribed for in the Subscription Offering
may be offered for sale in a community offering with preference given to certain
residents of Baltimore County, Maryland.
================================================================================
                               TERMS OF OFFERING

An independent appraiser has estimated the market value of the converted
Northfield Federal Savings to be between $3,825,000 and $5,175,000, which
establishes the number of shares to be offered at a price of $10.00 per share.
Subject to Office of Thrift Supervision approval, an additional 15% above the
maximum number of shares, or 595,125 shares may be offered. Based on these
estimates, we are making the following offering of shares of common stock:

     .    Price Per Share:                             $10.00
 
     .    Number of Shares Minimum/
          Maximum as adjusted:                         382,500 to 595,125
 
     .    Offering Expenses:                           $375,000
 
     .    Net Proceeds to the Company
          Minimum/Maximum as adjusted:                 $3,463,000 to $5,549,250
 
     .    Net Proceeds Per Share
          Minimum/Maximum as adjusted:                 $9.05 to $9.32

It is possible that we would issue an additional 3% of the total shares sold
under certain circumstances involving an improper allocation of shares in the
conversion.

Please refer to Risk Factors beginning on page 1 of this document.

These securities are not deposits or accounts and are not insured or guaranteed
by the Federal Deposit Insurance Corporation or any other government agency.

Neither the Securities and Exchange Commission, Office of Thrift Supervision,
nor any state securities regulator has approved or disapproved these securities
or determined if this prospectus is accurate or complete.  Any representation to
the contrary is a criminal offense.

For information on how to subscribe, call the Stock Information Center at (410)
668-2160.

                            TRIDENT SECURITIES, INC.
                The date of this Prospectus is ___________, 1998
<PAGE>
 
                               TABLE OF CONTENTS
 
                                                                            Page
                                                                            ----
 
Questions and Answers About the Stock Offering ............................. (i)
Summary.................................................................... (iv)
Selected Financial and Other Data......................................... (vii)
Risk Factors................................................................  1
Proposed Purchases by Directors and Officers................................  6
The Company.................................................................  6
Northfield Federal Savings..................................................  7
Use of Proceeds.............................................................  7
Dividends...................................................................  8
Market for the Common Stock.................................................  9
Capitalization.............................................................. 10
Historical and Pro Forma Capital Compliance................................. 11
Pro Forma Data.............................................................. 12
The Conversion.............................................................. 15
Management's Discussion and Analysis of Financial Condition and
 Results of Operations...................................................... 29
Business of Northfield Bancorp, Inc......................................... 40
Business of Northfield Federal Savings...................................... 40
Regulation.................................................................. 58
Taxation.................................................................... 65
Management of the Company................................................... 66
Management of Northfield Federal Savings.................................... 67
Restrictions on Acquisitions of the Company................................. 73
Description of Capital Stock................................................ 78
Legal and Tax Matters....................................................... 80
Experts..................................................................... 80
Additional Information...................................................... 80
Index to Financial Statements of Northfield Federal Savings................. 81
Glossary..................................................................  A-1
 

     This document contains forward-looking statements which involve risks and
uncertainties.  The Company's actual results may differ significantly from the
results discussed in the forward-looking statements.  Factors that might cause
such a difference include, but are not limited to, those discussed in "Risk
Factors" beginning on page 1 of this document.

     Please see the Glossary beginning on page A-1 for the meaning of
capitalized terms that are not defined in this document.
<PAGE>
 
                           [MAP OF NORTHFIELD FEDERAL
                              SAVINGS MARKET AREA]
<PAGE>
 
     QUESTIONS AND ANSWERS ABOUT THE STOCK OFFERING

Q.   What is a mutual to stock conversion?

A:   The conversion is a change in our form of organization.  Currently, we
     operate as a federally chartered mutual savings association with no
     stockholders.  As a result of the conversion, we will become a federally
     chartered stock savings bank.  As part of our conversion, the Company is
     offering for sale shares of its common stock  The Company will be our sole
     stockholder and will purchase our stock in exchange for a portion of the
     proceeds from its offering.

Q:   What is the purpose of the conversion and the offering?

A:   As a stock savings bank operating through a holding company structure, we
     will have the ability to plan and develop long-term growth and improve our
     future access to the capital markets.  The stock offering will increase our
     capital and the amount of funds available to us for lending and investment
     activities.  This will give us greater flexibility to diversify operations
     and expand into other geographic markets if we choose to do so.  If the
     Company's earnings are sufficient in the future, you might also receive
     dividends and benefit from the long-term appreciation of our stock price.

Q:   How many shares of stock will be sold?

A:   Between 382,500 and 517,500 shares of common stock will be sold, all at a
     price of $10.00 per share.   The number of shares to be sold may be
     increased to 595,125 shares without further notice to you, subject to
     receipt of approval of the Office of Thrift Supervision, if market or
     financial conditions change prior to completion of the conversion or if
     additional shares are needed to fill the order of our employee stock
     ownership plan (the "ESOP").  Also, it is possible that we would issue an
     additional 3% of the total shares sold in the event our board feels it is
     necessary to correct an improper allocation of shares in the conversion.

Q:   How do I subscribe for the stock?

A:   You must complete and return the Stock Order Form to us together with your
     payment or your authorization for withdrawal of the payment amount from an
     account you have with us, on or before ___________, 1998.  See pages __ to
     __.

Q:   How much stock may I purchase?

A:   The minimum purchase is 25 shares (or $250).  The maximum purchase per
     eligible depositor in the Subscription Offering is 12,500 shares (or
     $125,000).  We may decrease or increase the maximum purchase limitation
     without notifying you.


                                      (i)
<PAGE>
 
     If shares are sold in a Community Offering, the maximum number of shares
     that may be purchased by any party in the Community Offering, when combined
     with the number of shares purchased by other parties with whom your shares
     may be aggregated is 12,500 shares ($125,000).

     Total purchases of stock in the conversion (i.e., combined purchases in the
                                                 ----                           
     Subscription and Community Offerings) may not exceed the lesser of $225,000
     or 5% of the shares issued in the conversion.  See pages  __ to __.

Q:   What happens if there are not enough shares to fill all orders?

A:   You might not receive any or all of the shares you want to purchase.  If
     there is an over subscription, the stock will be offered on a priority
     basis to the following persons:

     .    Eligible Account Holders - Persons who had a deposit account with us
          on December 31, 1995 with a balance of at least $50.00.  Any remaining
          shares will be offered to:

     .    Our ESOP.  Any remaining shares will be offered to:

     .    Supplemental Eligible Account Holders - Persons who had a deposit
          account with us on March 31, 1998 with a balance of at least $50.00.
          Any remaining shares will be offered to:

     .    Other Members - Other depositors and certain borrowers of ours, as of
          __________, 1998.

     If the above persons do not subscribe for all of the shares, the remaining
     shares will be offered to certain members of the general public with
     preference given to people who live in Baltimore County, Maryland.  See
     pages __ to __.

Q:   What particular factors should I consider when deciding whether or not to
     buy the stock?

A:   There are numerous risks associated with purchasing our stock.  Before you
     decide to purchase stock, you should read the Risk Factors section
     beginning on page 1 of this document.

Q:   As a depositor or borrower member of Northfield Federal Savings, what will
     happen if I do not purchase any stock?

A:   You presently have voting rights while we are in the mutual form; however,
     once we convert to the stock form you will lose your voting rights unless
     you purchase stock.  You are not 

                                     (ii)
<PAGE>
 
     required to purchase stock. Your deposit account, certificate accounts and
     any loans you may have with us will be not be affected. See pages __ to __.

Q:   Who can help answer any other questions I may have about the stock
     offering?

A:   In order to make an informed investment decision, you should read this
     entire document.  In addition, you should contact:

                            Stock Information Center
                            Northfield Bancorp, Inc.
                               8005 Harford Road
                           Baltimore, Maryland  21234
                                 (410) 668-2160


                                     (iii)
<PAGE>
 
                                 SUMMARY

     This summary highlights selected information from this document and may not
contain all the information that is important to you.  To understand the stock
offering fully, you should read carefully this entire document, including the
financial statements and the notes to the financial statements of Northfield
Federal Savings.  References in this document to "we," "us," and "our" refer to
Northfield Federal Savings.  In certain instances where appropriate, "us" or
"our" refers collectively to Northfield Bancorp, Inc. and Northfield Federal
Savings.  References in this document to "the Company" refer to Northfield
Bancorp, Inc.

Northfield Bancorp, Inc.

     Northfield Bancorp, Inc. was formed in March 1998 as a Maryland corporation
to be the holding company for Northfield Federal Savings Bank.   The Company is
not an operating company and has not engaged in any significant business to
date.  The holding company structure will provide greater flexibility in terms
of operations, expansion and diversification.  See page __.

Northfield Federal Savings

     We are a community and customer oriented federal mutual savings association
with two offices located in Baltimore, Maryland.  We were originally founded in
1923 as a federally chartered mutual savings and loan association.   Our primary
market area consists of Baltimore County, Maryland.  In addition we focus our
lending efforts on Harford and Cecil Counties, Maryland.  We emphasize
residential construction lending, primarily originating construction/permanent
mortgage loans on one- to four-family properties.  We also make commercial real
estate loans and limited types of consumer loans.  We have recently begun to
offer home equity loans.  Our loans are primarily funded by deposit accounts,
approximately 61.6% of which were certificates of deposit at December 31, 1997.
At December 31, 1997, we had total assets of $36.1 million, deposits of $32.6
million, and total retained earnings of $2.9 million.  See page __.

The Stock Offering

     The Company is offering between 382,500 and 517,500 shares of common stock
at $10.00 per share. Subject to approval by the Office of Thrift Supervision,
the number of shares to be sold may be increased to 595,125 shares without
further notice to you if market or financial conditions change prior to
completion of the conversion or if additional shares are needed to fill the
order of our ESOP. During the 30 days following the conversion, we may also
issue an additional 3% of the total shares sold in the event our board feels it
is necessary to correct an improper allocation of shares in the conversion.
These additional shares (the "Contingent Shares"), are not reflected in the pro
forma financial data in this Prospectus.



                                     (iv)
<PAGE>
 
Stock Purchases

     The Company is first offering its shares of common stock in a Subscription
Offering. Depositor and borrower members as of certain eligibility dates will
receive subscription rights.  The shares of common stock will be offered on the
basis of priorities.  Any remaining shares may be offered  in a Community
Offering or in a Syndicated Community Offering.  See pages __ to __.

Subscription Rights

     You may not sell or assign your subscription rights.  Any transfer of
subscription rights is prohibited by law. All persons exercising their
subscription rights will be required to certify that they are purchasing shares
solely for their own account and that they have no agreement or understanding
regarding the sale or transfer of shares. The Company intends to pursue any and
all legal and equitable remedies in the event that the Company becomes aware of
the transfer of any subscription rights. The Company will reject orders that are
determined to involve the transfer of such rights.

The Offering Range and Determination of the Price Per Share

     The offering range is based on an independent appraisal of the pro forma
market value of the common stock by Ferguson & Company ("Ferguson"), an
appraisal firm experienced in appraisals of savings institutions.  The pro forma
market value of the shares is our market value after giving effect to the sale
of shares in this offering.  Ferguson has estimated that in its opinion as of
February 27, 1998 such value ranged between $3.8 million and $5.2 million (with
a midpoint of $4.5 million) (the "Estimated Valuation Range").  The appraisal
was based in part upon our financial condition and operations and the effect of
the additional capital raised by the sale of common stock in this offering.  The
$10.00 price per share was determined by our board of directors and is the price
most commonly used in stock offerings involving conversions of mutual savings
institutions.  The appraisal will be updated prior to the completion of the
conversion.  If the updated pro forma market value of the common stock is either
below $3.8 million or above $6.0 million (excluding the Contingent Shares), we
will notify you and you will have the opportunity to modify or cancel your
order.  See pages __ to __.

Termination of the Offering

     The Subscription Offering will terminate at __:__ .m., Eastern Time, on
___________, 1998.  The Community Offering, if any, may terminate at any time
without notice but no later than ___________, 1998, without approval by the OTS.

Benefits to Management from the Offering

     Our full-time employees will participate in the offering through purchases
of stock by our employee stock ownership plan (the "ESOP"), which is a form of
retirement plan.  Following the 


                                      (v)
<PAGE>
 
conversion, we also intend to implement a management recognition plan ("MRP")
under which officers will be entitled to receive awards of restricted stock at
no cost to them and a stock option and incentive plan (the "Option Plan"), which
will benefit our officers and directors. However, the MRP and Option Plan may
not be adopted until at least six months after the conversion and are subject to
stockholder approval and compliance with OTS regulations if adopted within the
first year following our conversion. See pages __ to __.

Use of the Proceeds from the Sale of Common Stock

     The Company intends to retain 50% of the net proceeds from the stock
offering.  The Company will use a portion of the net proceeds from the stock
offering to make a loan to our ESOP to fund its purchase of 8% of the common
stock issued in the conversion.  The Company will use a portion of the net
proceeds to purchase all the capital stock to be issued by us in the conversion.
The Company will retain the balance of the funds as its initial capitalization.
The Bank intends to use its portion of the net proceeds to finance a new office
building for its main office and a new branch office in Cecil County, Maryland.
The Bank will also use a portion of the net proceeds from the conversion to
expand its small business lending, which we expect to commence in the summer of
1998 with the hiring of a small business lending officer.  The remainder of the
net proceeds will be used to fund the Bank's other lending activities.  See page
__.

Dividends

     Our board of directors intends to adopt a policy of paying regular semi-
annual cash dividends on the common stock at a rate of 2% of the $10.00 per
share purchase price of the common stock ($0.20 per share).  The first dividend
will be declared and paid no earlier than the semi-annual period ending June 30,
1999.  See page __.

Market for the Common Stock

     The Company intends to list the common stock over-the-counter through the
OTC "Electronic Bulletin Board" under the symbol "____."  The Company intends to
request Trident Securities undertake to match offers to buy and offers to sell
the common stock.  Since the size of the offering is small, it is unlikely that
an active and liquid trading market for the shares will develop and be
maintained.  Investors should have a long-term investment intent.  Persons
purchasing shares may not be able to sell their shares when they desire or to
sell them at a price equal to or above $10.00.  See page __.

Important Risks in Owning the Company's Common Stock

     Before you decide to purchase stock in the offering, you should read the
"Risk Factors" section beginning on page 1 of this document.


                                     (vi)
<PAGE>
 
                       SELECTED FINANCIAL AND OTHER DATA

     We are providing the following summary financial information about us for
your benefit. This information is derived from our audited financial statements
for each of the fiscal years shown below.  The following information is only a
summary and you should read it in conjunction with our financial statements and
notes to our financial statements which you can find beginning on page F-1 of
this Prospectus.

 
Selected Financial Data
 
  The following table sets forth certain information concerning our financial
position at the dates indicated.

<TABLE> 
<CAPTION> 
                                                           At December 31,
                                                      --------------------------
                                                         1997             1996
                                                      --------          --------
                                                            (In thousands)
<S>                                                   <C>               <C>  
Total assets........................................  $ 36,084          $ 32,228
Cash................................................       117               173
Interest-bearing deposits in other banks............     3,514             5,186
Securities available for sale.......................        --               197
Mortgage-backed securities..........................     1,955             2,333
Loans receivable - net..............................    29,961            23,841
Federal Home Loan Bank of Atlanta stock.............       226               226
Deposit accounts....................................    32,622            29,116
Total retained earnings - substantially restricted..     2,894             2,729
</TABLE> 
 
 
Summary of Operations
 
   The following table sets forth certain information concerning our results of
operations for the periods shown.

<TABLE> 
<CAPTION> 
                                                        Year Ended December 31,
                                                       -------------------------
                                                         1997             1996
                                                       -------           -------
                                                            (In thousands)
<S>                                                    <C>               <C>  
Interest income.....................................   $ 2,626           $ 2,457
Interest expense....................................     1,493             1,397
                                                       -------           -------
Net interest income.................................     1,133             1,060
Provision for loan losses...........................       123                10
                                                       -------           -------
Net interest income after provision
 for loan losses....................................     1,010             1,050
Noninterest income (loss)...........................        (2)               31
Noninterest expense.................................       772               843
                                                       -------           -------
Income before taxes.................................       236               238
Income tax expense..................................        91                89
                                                       -------           -------
Net income..........................................   $   145           $   149
                                                       =======           =======
</TABLE> 

                                     (vii)
<PAGE>
 
Key Operating Ratios

     The table below sets forth certain performance ratios for us for the
periods indicated.

<TABLE> 
<CAPTION> 
                                                          At or for the       
                                                     Year Ended December 31,  
                                                     -----------------------  
                                                     1997     1996      1995  
                                                     ----     ----      ----  
<S>                                                  <C>      <C>       <C> 
Performance Ratios:                                                           
   Return on assets (ratio of net earnings
    to average total assets)......................    .43%     .46%      .85%
   Return on equity (ratio of net earnings
    to average equity)............................   4.99     5.50     10.47
   Ratio of average interest-earning assets
    to average interest-bearing liabilities....... 111.11   109.99    109.33
   Ratio of net interest income, after
    provision for loan losses and
    noninterest expense........................... 130.83   124.56    161.31
   Net interest rate spread.......................   2.88     2.90      3.08
   Net interest margin............................   3.37     3.34      3.50

Asset Quality Ratios:
   Nonperforming loans to total loans
    at end of period..............................   1.31     1.07       .50
   Nonperforming loans to total assets............   1.15      .84       .35
   Nonperforming assets to total assets
    at end of period..............................   1.15      .84       .35
   Allowance for loan losses to nonperforming
    loans at end of period........................  52.17    37.04     79.65
   Allowance for loan losses to total loans,
    net...........................................    .72      .42       .41

Capital Ratios:
   Equity to total assets at end of period........   8.02     8.47      8.04
   Average equity to average assets...............   8.52     8.39      8.07

Other Data:
   Number of full service offices.................      2        2         2
</TABLE> 

                                    (viii)
<PAGE>
 
                                  RISK FACTORS

     In addition to the other information in this document, you should consider
carefully the following risk factors in deciding whether to invest in the common
stock.

Potential Impact of Changes in Interest Rates and the Current Interest Rate
Environment

     Our ability to make a profit, like that of most financial institutions, is
substantially dependent on our net interest income, which is the difference
between the interest income we earn on our interest-earning assets (such as
mortgage loans and investments) and the interest expense we pay on our interest-
bearing liabilities (such as deposits).  Because most of the loans we originate
have fixed rates and have longer effective maturities than our interest-bearing
liabilities, the yield on our interest-earning assets adjusts more slowly to
changes in interest rates than the cost of our interest-bearing liabilities.
Accordingly,  our net interest income could be adversely affected by material
and prolonged increases in interest rates since our interest expense would
increase at a faster rate than our interest income.  Unlike many other thrift
institutions who offer both adjustable and fixed rates on single family loans
and tend to emphasize adjustable rate loans under rising interest rate
conditions, our policy is to originate all of our one- to four-family
residential loans, representing 81.4% of our total loans at December 31, 1997,
with fixed rates.  As a result,  we have significant exposure to interest rate
risk.  Our earnings may also be adversely affected by rising interest rates due
to decreased customer demand.  We attempt to reduce this risk by seeking shorter
term assets, longer term liabilities and originating variable rate loans if
possible.  We also believe that our interest rate risk exposure will be partly
mitigated by the introduction of shorter-term home equity loans and small
business loans, all of which will have variable rates.

     The average life of loans and mortgage-backed securities can also be
affected by changes in interest rates.  As interest rates decline, borrowers
tend to refinance higher-rate, fixed rate loans at lower rates.  We also
experience an increase in prepayments on mortgage-backed securities as the loans
underlying such securities are prepaid.  Since rates will have declined, we
would not be able to reinvest such prepayments in assets earning interest rates
as high as the rates on the prepaid loans or mortgage-backed securities.  As a
result our interest income could decline.

     Our investment portfolio is also affected by changes in interest rates
since a substantial portion of our investments carry fixed rates.  Generally,
the value of a fixed rate investment will decrease as interest rates rise.  As
of December 31, 1997, the market value of our mortgage-backed securities
portfolio (the primary component of our investment portfolio) exceeded the
carrying value of such investments by $56,000.

Below Average Return on Average Equity and Increased Expenses After Conversion

     Return on average equity (net income divided by average equity) is a ratio
used by many investors to compare the performance of a savings institution to
its peers.  As a result of the conversion, our equity will increase
substantially.  Our expenses also will increase due to several 

                                       1
<PAGE>
 
factors. First, we plan to spend approximately $1.5 million on a new office
building for our main office. We will also incur significant expenses relating
to the development of a new branch office in Cecil County, Maryland. Our
compensation expense will increase due to added personnel to staff our new
branch and due to the addition of a small business loan officer. We will also
see added expense associated with the ESOP and, later on, the MRP as well as
with the costs of being a public company. Because of the increases in our equity
and expenses, we expect our return on equity to decrease as compared to our
performance in previous years. At December 31, 1996 and 1997 our return on
average equity was 5.5% and 4.99%, respectively. A lower return on equity could
reduce the trading price of our shares. While increases in our operating
expenses may be offset by earnings on the conversion proceeds, there can be no
assurance that we will be able to increase net income in future periods. We plan
to use a portion of the net proceeds from the conversion to expand our small
business lending, which we commenced in ________ 1998 when we hired a small
business lending officer. See "Business of Northfield Federal Savings -- Lending
Activities."

Commercial Leases

     We purchase commercial finance leases from a local leasing company.  At
December 31, 1997, our portfolio of commercial leases totaled $741,000 or 2.3%
of total loans.  In recent years, we have come under regulatory criticism based
on violation of the OTS's loans to one borrower regulation.  We have made
changes to the program and are in the process of bringing the program into
compliance with the loans to one borrower regulation.  Since the program began,
we have experienced losses of $7,700 in connection with these leases, all
involving non-recourse purchases. Currently, all of our purchases are on a
recourse basis.

     Commercial leases are subject to the same risk of default as direct
commercial loans.  See "Business of Northfield Federal Savings -- Lending
Activities."

Risks Associated with Construction, Commercial Real Estate, Consumer Lending and
the Introduction of Small Business Lending

     Our primary lending activity is the origination of loans to finance the
construction of one-to four-family residential properties.  Nearly all of these
loans are structured to be converted to permanent loans at the end of the
construction phase.  A majority of our one-to four- family residential loans
were originated as construction/permanent loans.  Construction financing
involves a greater risk of loss than long-term financing on improved, occupied
real estate.  Our risk of loss on a construction loan is dependent largely upon
the accuracy of the initial estimate of the property's value at completion of
construction or development and the estimated cost (including interest) of
construction.  If the estimate of construction cost proves to be inaccurate, we
may be required to advance funds beyond the amount originally committed to
permit completion of the development. If the estimate of value proves to be
inaccurate, we may be confronted, at or prior to the maturity of the loan, with
a project with a value which is insufficient to assure full repayment.

                                       2
<PAGE>
 
     We are also actively involved in commercial real estate lending.  At
December 31, 1997, these loans represented approximately 8.9% of the loans in
our portfolio.  These loans are secured by small office buildings or by multi-
family residential investment properties.  Commercial real estate lending
involves a higher degree of credit risk than one- to four-family residential
lending due primarily to concentration of funds in a limited number of loans and
because such loans depend on cash flow from the property to service the debt.
Cash flow may be significantly affected by general economic conditions.

     We also plan to begin offering small business loans guaranteed by the Small
Business Administration in the summer of 1998.  Unlike residential mortgage
loans, commercial business loans are typically made on the basis of the
borrower's ability to make repayment from the cash flow of the borrower's
business, and therefore involve a greater degree of risk than one- to four-
family residential loans.

Lack of Active Market for Common Stock

     Due to the small size of the offering, it is highly unlikely that an active
trading market will develop and be maintained.  If an active market does not
develop, you may not be able to sell your shares promptly or perhaps at all, or
sell your shares at a price equal to or above the price you paid for the shares.
The common stock may not be appropriate as a short-term investment.  See "Market
for the Common Stock."

Risk of Decline in Demand for Construction Loans in Our Market Areas

     A majority of our one- to four-family residential loans are originated as
construction/permanent loans.  As a result, our business is heavily dependent on
the continued demand for single family housing construction in our market areas.
In the event the demand for new houses in our market areas were to decline, we
would be forced to shift our lending emphasis.  There can be no assurance of our
ability to continue growth and profitability in our lending activities in the
event of such a decline.

Impact of Technological Advances; Year 2000 Compliance

     Our industry is experiencing rapid changes in technology.  Technology-
driven products and services are frequently introduced.  In addition to
improving customer services, effective use of technology increases efficiency
and enables financial institutions to reduce costs.  Our future success will
thus depend partly on our ability to address our customers' needs by using
technology.  Many of our competitors have far greater resources than we have to
invest in technology.  There can be no assurance that we will be able to
effectively develop new technology-driven products and services or be successful
in marketing these products to our customers.

                                       3
<PAGE>
 
     Our operations are also dependent on computers and computer systems,
whether we maintain them internally or they are maintained by a third party.  We
have taken steps to ensure that our computer systems will properly recognize
information when the year changes to 2000.  Systems that do not properly
recognize the correct year could produce faulty data or cause a system to fail.
We have also taken steps to ensure that we are in compliance with regulatory
directives in this area. There can be no assurance, however, that we and our
third party providers will be successful in making all necessary changes to
avoid computer system failure related to the year 2000.

Anti-Takeover Provisions and Statutory Provisions That Could Discourage Hostile
Acquisitions of Control

     Provisions in the Company's articles of incorporation and bylaws, the
General Corporation Law of the State of Maryland, and certain federal
regulations may make it difficult, and expensive, to pursue a tender offer,
change in control or takeover attempt which we oppose.  As a result,
stockholders who might desire to participate in such a transaction may not have
an opportunity to do so.  Such provisions will also render the removal of the
current board of directors or management of the Company more difficult.  In
addition, these provisions may reduce the trading price of our stock.  These
provisions include:  restrictions on the acquisition of the Company's equity
securities and limitations on voting rights; the classification of the terms of
the members of the board of directors; certain provisions relating to the
meeting of stockholders; denial of cumulative voting by stockholders in the
election of directors; the issuance of preferred stock and additional shares of
common stock without shareholder approval; and super-majority provisions for the
approval of certain business combinations.  See "Restrictions on Acquisitions of
the Company"

Possible Voting Control by Directors and Officers

     The proposed purchases of the common stock by our directors, officers and
ESOP (estimated to be approximately 103,000 shares, or 22.89% of the shares to
be outstanding assuming 450,000 shares are sold), as well as the potential
acquisition of common stock through the Option Plan and MRP, could make it
difficult to obtain majority support for stockholder proposals which are opposed
by us.  In addition, the voting of those shares could enable us to block the
approval of transactions (i.e., business combinations and amendment to our
articles of incorporation and bylaws) requiring the approval of 80% of the
stockholders under the Company's articles of incorporation.  See "Management of
Northfield Federal Savings -- Executive Compensation -- Employee Stock Ownership
Plan," " -- Proposed Future Stock Benefit Plans -- Stock Option Plan," " --
Management Recognition Plan," "Description of Capital Stock," and "Restrictions
on Acquisitions of the Company."

                                       4
<PAGE>
 
Possible Dilutive Effect and Expense of MRP and Stock Options

     If the conversion is completed and stockholders subsequently approve the
MRP and Option Plan, we will issue stock to our officers and directors through
these plans.  If the shares for the MRP are issued from our authorized but
unissued stock, your ownership percentage could be diluted by up to
approximately 4% and the trading price of our stock may be reduced.  See "Pro
Forma Data," "Management of Northfield Federal Savings -- Proposed Future Stock
Benefit Plans -- Stock Option Plan," and "-- Management Recognition Plan."
These plans will also involve additional expense. See "Risk Factors -- Below
Average Return on Average Equity and Increased Expenses After Conversion."

Financial Institution Regulation of the Thrift Industry

     We are subject to extensive regulation, supervision, and examination by the
OTS and FDIC. A bill has been introduced in the House Banking Committee that
would consolidate the OTS with the Office of the Comptroller of the Currency
("OCC").  If this regulation is approved, we could be forced to become a state
or national commercial bank.  If we become a commercial bank, our investment
authority, branching authority and the ability of the Company to engage in,
diversified activities may be limited, which could affect our profitability.
See "Regulation."

Possible Adverse Tax Consequences of the Subscription Rights

     We have received the opinion of Ferguson that the subscription rights
granted to eligible members in connection with the conversion have no value.
This opinion is not binding on the Internal Revenue Service ("IRS"), however.
Should the IRS determine that the subscription rights do have ascertainable
value, you could be taxed as a result of your exercise of such rights in an
amount equal to such value.

Restrictions on Repurchase of Shares

     Generally, during the first year following the conversion, the Company may
not repurchase its shares. During each of the second and third years following
the conversion, the Company may repurchase up to 5% of its outstanding shares.
During those periods, if we decide that additional repurchases would be a good
use of funds, we would not be able to do so, without obtaining OTS approval.
There is no assurance that OTS approval would be given. See "The Conversion --
Restrictions on Repurchase of Shares."

                                       5
<PAGE>
 
                  PROPOSED PURCHASES BY DIRECTORS AND OFFICERS

     The following table sets forth the approximate purchases of common stock by
each director and executive officer and their associates in the conversion.  The
table assumes that 450,000 shares (the midpoint of the Estimated Valuation
Range) of the common stock will be sold at $10.00 per share and that sufficient
shares will be available to satisfy their subscriptions.

<TABLE>
<CAPTION>
 
                                                                              Aggregate  
                                                                   Total       Price of      Percent
                                                                  Shares       Shares       of Shares
Name                                 Position                    Purchased    Purchased     Purchased
- ----                                 --------                    ---------    ---------     ---------
<S>                                  <C>                         <C>          <C>           <C>         
Gary R. Bozel                        Chairman of the Board        12,500       $125,000        2.78%
                                                                                       
J. Thomas Hoffman                    Director                     12,500        125,000        2.78
                                                                                       
G. Ronald Jobson                     Director, President and                           
                                      Chief Executive Officer     12,500        125,000        2.78    
                                                                                       
E. Thomas Lawrence, Jr.              Director                      3,000         30,000         .67
                                                                                       
David G. Rittenhouse                 Director                     12,500        125,000        2.78
                                                                                       
William R. Rush                      Director                     12,500        125,000        2.78
                                                                                       
All directors and executive                                                            
officers as a group (8 persons)                                   67,000        670,000       14.89    
                                                                                       
ESOP                                                              36,000        360,000        8.00    
Management Recognition Plan                                       18,000        180,000        4.00    
                                                                --------     ----------       ----- 
                                                                 121,000     $1,210,000       26.89%
                                                                ========     ==========       =====  
</TABLE>

                                  THE COMPANY

     The Company was formed as a Maryland corporation on March 5, 1998 at our
direction for the purpose of serving as our holding company after the
conversion.  Prior to the conversion, the Company has not engaged and is not
expected to engage in any significant operations. The Company has received the
approval of the OTS to acquire control of us upon completion of the conversion.
Upon consummation of the conversion, the only assets the Company is expected to
own are the capital stock we will issue in the conversion, a note receivable
from our ESOP and any proceeds from the offering it retains.

     As a holding company, the Company will have greater flexibility than we
would have to diversify its business activities through the formation of
subsidiaries or through acquisition. The Company will be classified as a unitary
savings and loan holding company after the conversion and will be required to
comply with OTS regulations and be subject to examination.

                                       6
<PAGE>
 
     The Company's executive offices are located at 8005 Harford Road,
Baltimore, Maryland 21234 and its main telephone number is (410) 665-7900.


                          NORTHFIELD FEDERAL SAVINGS

     We are a federal mutual savings association operating through two offices
in Baltimore County, Maryland.  We were founded in 1923 as a federally chartered
savings institution and are a member of the FHLB System.  Upon our conversion to
stock form, we will adopt the name "Northfield Federal Savings Bank."  Our
deposits are insured up to applicable limits by the Federal Deposit Insurance
Corporation ("FDIC") under the SAIF.  At December 31, 1997, we had total assets
of $36.1 million, total deposits of $32.6 million and total retained earnings of
$2.9 million.

     Our principal business consists of attracting deposits, primarily
certificates of deposit, from the general public and originating residential
mortgage loans, primarily construction/permanent loans on one- to four-family
properties.  We also offer commercial real estate and limited types of consumer
loans.  We also have a portfolio of purchased commercial leases.

     Our executive offices are located at 8005 Harford Road, Baltimore, Maryland
21234 and our main telephone number is (410) 665-7900.


                                USE OF PROCEEDS

     The Company intends to retain 50% of the net proceeds from the stock
offering.  Currently, we expect that in accordance with applicable OTS
regulations and policies, the Company will retain $1,502,000, $1,792,500,
$2,083,500 and $2,417,550, respectively, at the minimum, midpoint, maximum and
maximum as adjusted, of the Estimated Valuation Range.  The balance will be used
to purchase all of the capital stock we will issue in connection with the
conversion.  A portion of the net proceeds to be retained by the Company will be
lent to our ESOP to fund its purchase of 8% of the shares sold in the
conversion.  On a short-term basis, the balance of the net proceeds retained by
the Company initially will be invested in short-term investments.  A portion of
the net proceeds may also be used to fund the purchase of 4% of the shares for
the MRP, which is anticipated to be adopted following the conversion.  See "Pro
Forma Data."

     The Bank expects to use its portion of the net conversion proceeds as
follows.  First, we estimate that approximately $1.5 million will be used to
finance the purchase and construction of a new main office in the same general
area as our current main office is located.  We expect that our current main
office would then be converted into a branch office.  We also have plans in the
future for the lease or purchase of property to establish a branch in Cecil or
Harford County, Maryland, areas which we consider attractive for future growth.
We estimate spending approximately $120,000 on establishing the branch and
expect that the new branch will cost approximately $40,000 in its first year of
operation.  We believe that a new main office building and the establishment of
new branches 

                                       7
<PAGE>
 
will help us take advantage of strong loan demand in our market areas. Based on
preliminary estimates, we also expect to spend approximately $750,000 in the
year following conversion to expand our small business lending, which we plan to
commence in the summer of 1998 when we hired a small business lending officer
who has considerable experience in this area. The remainder of the net proceeds
distributed to the Bank will be used to fund our other lending activities. See
"Business of Northfield Federal Savings -- Lending Activities."

     The net proceeds may vary because the total expenses of the conversion may
be more or less than those estimated.  We expect our estimated expenses to be
$375,000.  Our estimated net proceeds will range from $3.5 million to $4.8
million (or up to $5.6 million in the event the maximum of the Estimated
Valuation Range is increased to $6.0 million) (excluding the value of any
Contingent Shares issued).   See "Pro Forma Data."  The net proceeds will also
vary if the number of shares to be issued in the conversion is adjusted to
reflect a change in our estimated pro forma market value. Payments for shares
made through withdrawals from existing deposit accounts with us will not result
in the receipt of new funds for investment by us but will result in a reduction
of our liabilities and interest expense as funds are transferred from interest-
bearing certificates or accounts.

     For a period of one year following the completion of the conversion, we
will not pay any dividends that would be construed as a return of capital nor
take any actions to pursue or propose such dividends.

                                   DIVIDENDS

     The payment of dividends is determined and declared by the Company's board
of directors. The board currently intends to establish a policy of paying
regular semi-annual cash dividends on the common stock at an initial annual rate
of 2.0% of the $10.00 per share purchase price of the common stock in the
conversion ($0.20 per share), with the first dividend being declared and paid no
earlier than for the semi-annual period ending June 30, 1999.  In addition, from
time to time in an effort to manage capital at a desirable level, the board may
determine to pay special cash dividends.  We cannot assure you that special
dividends will be paid, or, if paid, will continue to be paid.  See "Historical
and Pro Forma Capital Compliance," "The Conversion -- Effects of Conversion to
Stock Form on Depositors and Borrowers of Northfield Federal Savings --
Liquidation Account" and "Regulation -- Regulation of Northfield Federal Savings
- -- Dividend and Other Capital Distribution Limitations."

     The Company is not subject to OTS regulatory restrictions on the payment of
dividends to its stockholders although the source of such dividends will be
dependent in part upon the receipt of dividends from us.   The Company is
subject, however, to the requirements of Maryland law.  Under Maryland law, the
Company may pay a dividend as long as it will not affect the ability of the
Company, after the dividend has been distributed, to pay its debts in the
ordinary course of business or result in its assets being less than the sum of
its liabilities plus the amount that would be needed (if any) to satisfy any
preferential rights upon a dissolution of the Company of any stockholders with
rights ahead of those receiving the dividend.

                                       8
<PAGE>
 
     In addition to the foregoing, the portion of our earnings which have been
appropriated for bad debt reserves and deducted for federal income tax purposes
cannot be used by us to pay cash dividends to the Company without the payment of
federal income taxes by us at the then current income tax rate on the amount
deemed distributed, which would include the amount of any federal income taxes
attributable to the distribution.  See "Taxation -- Federal Taxation" and Note
10 to the Financial Statements.  The Company does not contemplate any
distribution by us that would result in a recapture of our bad debt reserve or
otherwise create federal tax liabilities.


                          MARKET FOR THE COMMON STOCK

     The Company has never issued common stock to the public.  Consequently,
there is no established market for the common stock.  Following completion of
the Offering, the Company intends to list the common stock over-the-counter
through the OTC "Electronic Bulletin Board" under the symbol "______," and the
Company intends to request that Trident Securities, Inc. ("Trident Securities")
undertake to match offers to buy and offers to sell the common stock.  Trident
Securities has no obligation to match offers to buy and offers to sell and may
cease doing so at any time.  There can be no assurance that timely or accurate
quotations will be available on the OTC "Electronic Bulletin Board."  In
addition, the existence of a public trading market will depend upon the presence
in the market of both willing buyers and willing sellers at any given time.  The
presence of a sufficient number of buyers and sellers at any given time is a
factor over which neither the Company nor any broker or dealer has control.  Due
to the relatively small number of shares of common stock being offered in the
conversion and the concentration of ownership, it is unlikely that an active or
liquid trading market will develop or be maintained.  Further, the absence of an
active and liquid trading market may make it difficult to sell the common stock
and may have an adverse effect on the price of the common stock.  Purchasers
should consider the potentially illiquid and long-term nature of their
investment in the shares offered hereby.

     The aggregate price of the common stock is based upon an independent
appraisal of the pro forma market value of the common stock.  However, there can
be no assurance that an investor will be able to sell the common stock purchased
in the conversion at or above the purchase price.

                                       9
<PAGE>
 
                                 CAPITALIZATION

     The following table presents our historical capitalization as of 
December 31, 1997 and the pro forma consolidated capitalization of the Company
after giving effect to the conversion, based upon the sale of the number of
shares shown below and the other assumptions set forth under "Pro Forma Data."
The table does not reflect issuance of any Contingent Shares.

<TABLE>
<CAPTION>
 
                                                                              Pro Forma Consolidated Capitalization of              
                                              Capitalization           the Company at December 31, 1997 Based on the Sale of        
                                                  of the        --------------------------------------------------------------------
                                                 Bank at        382,500 Shares    450,000 Shares    517,500 Shares    595,125 Shares
                                               December 31,        at $10.00         at $10.00         at $10.00         at $10.00  
                                                   1997            Per Share         Per Share         Per Share         Per Share  
                                              --------------------------------------------------------------------------------------
                                                                                    (In thousands)                           
       
<S>                                              <C>               <C>               <C>               <C>               <C>  
Deposits(1)...................................   $ 32,622          $ 32,622          $ 32,622          $ 32,622          $ 32,622
Other borrowed funds..........................         --                --                --                --                --
                                                 --------          --------          --------          --------          -------- 
  Total deposits and borrowed funds...........   $ 32,622          $ 32,622          $ 32,622          $ 32,622          $ 32,622
                                                 ========          ========          ========          ========          ======== 
Capital stock:
 Preferred stock, $0.01 par value per share:
  authorized - 2,000,000 shares; assumed 
  outstanding - none..........................         --                --                --                --                --
 Common stock, $0.01 par value per share
  authorized - 8,000,000 shares; shares 
  to be outstanding - as shown................         --                 4                 5                 5                 6
 Paid-in capital(2)...........................         --             3,459             4,120             4,783             5,543
 Less: Common stock acquired by ESOP(3).......         --              (306)             (360)             (414)             (476)
       Common stock acquired by MRP(4)........         --              (153)             (180)             (207)             (238)
 Retained earnings -- substantially
  restricted..................................      2,894             2,894             2,894             2,894             2,894
                                                 --------          --------          --------          --------          -------- 
  Total stockholders' equity..................   $  2,894          $  5,898          $  6,479          $  7,061          $  7,729
                                                 ========          ========          ========          ========          ======== 
</TABLE> 

- ---------------
(1)    Withdrawals from savings accounts for the purchase of stock have not been
       reflected in these adjustments. Any withdrawals will reduce pro forma
       capitalization by the amount of such withdrawals.
(2)    Based upon the estimated net proceeds from the sale of capital stock less
       the par value of shares sold.
(3)    Assumes 8% of the shares of common stock to be sold in the conversion are
       purchased by the ESOP and that the funds used to purchase such shares are
       borrowed from the Company.  See "Pro Forma Data" for additional details.
(4)    Assumes the Company issues 4% of the shares sold in the offering to the
       MRP and the purchase price for the shares purchased by the MRP was equal
       to the purchase price of $10.00 per share and 20% of the amount
       contributed was an amortized expense during such period. As a result of
       the MRP, stockholders' interests will be diluted by approximately 4%. See
       "Management of Northfield Federal Savings - Proposed Future Stock Benefit
       Plans - Management Recognition Plan." Implementation of the MRP within
       one year of conversion would require regulatory and stockholder approval
       at a meeting of our stockholders to be held no earlier than six months
       after the conversion.

                                       10
<PAGE>
 
                  HISTORICAL AND PRO FORMA CAPITAL COMPLIANCE

     The following table shows our historical capital position relative to our
regulatory capital requirements as of December 31, 1997 and on a pro forma basis
after giving effect to the conversion and based upon the sale of the number of
shares shown below and the other assumptions set forth under "Pro Forma Data."
The table does not reflect the issuance of any Contingent Shares.  The
definitions of the terms used in the table are those provided in the capital
regulations issued by the OTS.  For a discussion of the capital standards
applicable to us, see "Regulation -- Regulation of the Bank -- Regulatory
Capital Requirements."

<TABLE> 
<CAPTION> 
                                                                      Pro Forma At December 31, 1997 Based on the Sale of/(1)/:
                                                               ---------------------------------------------------------------------
                                                                      Minimum of             Midpoint of             Maximum of     
                                                                   382,500 Shares          450,000 Shares          517,500 Shares   
                                            Historical at             at $10.00               at $10.00               at $10.00
                                          December 31, 1997           Per Share               Per Share               Per Share
                                      -----------------------  ---------------------------------------------------------------------
                                                  Percent of              Percent of              Percent of              Percent of
                                        Amount    Assets (2)    Amount    Assets (2)    Amount    Assets (2)    Amount    Assets (2)
                                        ------    ----------    ------    ----------    ------    ----------    ------    ----------
                                                                            (Dollars in Thousands)                   
<S>                                     <C>         <C>         <C>          <C>        <C>         <C>         <C>          <C>   
Capital under generally accepted 
 accounting principles................  $ 2,894      8.0%       $ 4,167      11.1%      $ 4,417      11.6%      $ 4,667      12.2% 
                                        =======     ====        =======      ====       =======      ====       =======      ====   
                                                                                                                
Tangible capital......................  $ 2,894      8.0%       $ 4,167      11.1%      $ 4,417      11.6%      $ 4,667      12.2%  
Tangible capital requirement..........      541      1.5            565       1.5           570       1.5           574       1.5   
                                        -------     ----        -------      ----       -------      ----       -------      ----   
  Excess..............................  $ 2,353      6.5%       $ 3,602       9.6%      $ 3,847      10.1%      $ 4,093      10.1%  
                                        =======     ====        =======      ====       =======      ====       =======      ====   

Core capital..........................  $2,894       8.0%       $ 4,167      11.1%      $ 4,417      11.6%      $ 4,667      12.2%  
Core capital requirement..............   1,083       3.0          1,130       3.0         1,139       3.0         1,148       3.0   
                                        -------     ----        -------      ----       -------      ----       -------      ----   
  Excess..............................  $ 1,811      5.0%       $ 3,037       8.1%      $ 3,278       8.6%      $ 3,519       9.2%  
                                        =======     ====        =======      ====       =======      ====       =======      ====   

Risk-based capital....................  $ 3,109     17.2%       $ 4,382      23.8%      $ 4,632      25.1%      $ 4,882      26.3%  
Risk-based capital requirement........    1,447      8.0          1,473       8.0         1,477       8.0         1,482       8.0   
                                        -------     ----        -------      ----       -------      ----       -------      ----   
  Excess..............................  $ 1,662      9.2%       $ 2,909      15.8%      $ 3,155      17.1%      $ 3,400      18.3%  
                                        =======     ====        =======      ====       =======      ====       =======      ====   
<CAPTION> 
                                          Maximum as adjusted
                                            595,125 Shares  
                                              at $10.00     
                                              Per Share     
                                        -----------------------
                                                    Percent of
                                         Amount     Assets (2)
                                         ------     ----------
<S>                                     <C>           <C> 
Capital under generally accepted        
 accounting principles................  $ 4,955       12.8% 
                                        =======       ====                   
                                        
Tangible capital......................  $ 4,955       12.8%                   
Tangible capital requirement..........      579        1.5  
                                        -------       ----  
  Excess..............................  $ 4,376       11.3% 
                                        =======       ====  
                                                          
Core capital..........................  $ 4,955       12.8% 
Core capital requirement..............    1,159        3.0  
                                        -------       ----  
  Excess..............................  $ 3,796        9.8% 
                                        =======       ====  
                                      
Risk-based capital....................  $ 5,170       27.8%                   
Risk-based capital requirement........    1,488        8.0
                                        -------       ----
  Excess..............................  $ 3,682       19.8%  
                                        =======       ====
</TABLE> 

- ---------------
(1)    Assumes that the Company will retain net proceeds of $1,502,000,
       $1,792,500, $2,083,500 and $2,417,550, respectively, at the minimum,
       midpoint, maximum and maximum as adjusted, with the remainder to be used
       by the Company to purchase all of our capital stock to be issued upon
       conversion. Assumes net proceeds distributed to the Company or to us
       initially are invested in short-term securities that carry a risk-weight
       equal to the ratio of risk-weighted assets to total assets at December
       31, 1997. Assumes the ESOP purchases 8% of the shares to be sold in the
       conversion and borrows the funds needed to purchase such shares from the
       Company. Although repayment of such debt will be secured solely by the
       shares purchased by the ESOP, we expect to make discretionary
       contributions to the ESOP in an amount at least equal to the principal
       and interest payments on the ESOP debt. The approximate amount expected
       to be borrowed by the ESOP is not reflected in this table as borrowed
       funds but is reflected as a reduction of capital. Assumes a number of
       issued and outstanding shares of common stock equal to 4% of the common
       stock to be sold in the conversion will be purchased by the MRP after the
       conversion. The dollar amount of the common stock possibly to be
       purchased by the MRP is based on the price per share in the conversion
       and represents unearned compensation and is reflected as a reduction of
       capital. Such amounts do not reflect possible increases or decreases in
       the value of such stock relative to the price per share in the
       conversion. As we accrue compensation expense to reflect the vesting of
       such shares pursuant to the MRP, the charge against capital will be
       reduced accordingly. Does not reflect a possible increase in capital upon
       the exercise of options by participants in the Option Plan, under which
       directors, executive officers and other employees could be granted
       options to purchase an aggregate amount of common stock equal to 10% of
       the shares issued in the conversion (450,000 shares at the midpoint of
       the Estimated Valuation Range) at exercise prices equal to the market
       price of the common stock on the date of grant. Under the MRP and the
       Option Plan, shares issued to participants could be newly issued shares
       or, subject to regulatory restrictions, shares repurchased in the market.
       The MRP and the Option Plan are required to be approved by the Company's
       stockholders and will not be implemented until at least six months after
       the conversion. See "Management of Northfield Federal Savings -- Proposed
       Future Stock Benefit Plans."
(2)    Based on our total assets determined under generally accepted accounting
       principles for equity purposes ($36.1 million for all scenarios),
       adjusted total assets for the purposes of the tangible and core capital
       requirements ($37.7 million, $38.0 million, $38.3 million and $38.6
       million, respectively, at December 31, 1997 and on a pro forma basis at
       the minimum, midpoint, maximum and maximum as adjusted, of the Estimated
       Valuation Range) and risk-weighted assets for the purpose of the risk-
       based capital requirement ($18.41 million, $18.5 million, $18.53 million
       and $18.6 million, respectively, at December 31, 1997 and on a pro forma
       basis at the minimum, midpoint, maximum and maximum as adjusted, of the
       Estimated Valuation Range).

                                       11
<PAGE>
 
                                PRO FORMA DATA

     The actual net proceeds from the sale of the common stock cannot be
determined until the conversion is completed.  However, net proceeds are
currently estimated to be between $3.5 million and $5.6 million at the minimum
and maximum as adjusted, of the Estimated Valuation Range, based upon the
following assumptions: (i) all of the shares will be sold in the Subscription or
Community Offering; (ii) expenses, including commissions to be paid to Trident
Securities, will amount to $375,000.

     The following table sets forth our historical net earnings and
stockholders' equity prior to the conversion and the pro forma consolidated net
income and stockholders' equity of the Company following the conversion.  Pro
forma consolidated net income and stockholders' equity have been calculated as
if the common stock to be issued in the conversion had been sold at January 1,
1997, and the estimated net proceeds had been invested at 5.55%, which was
approximately equal to the one-year U.S. Treasury bill rate at December 31,
1997.  The one-year U.S. Treasury bill rate, rather than an arithmetic average
of the average yield on interest-earning assets and average rate paid on
deposits, has been used to estimate income on net proceeds because we believe
that it is a more accurate estimate of the rate that would be obtained on an
investment of net proceeds from the offering.  In calculating pro forma income,
an effective state and federal income tax rate of 38% has been assumed,
resulting in an after tax yield of 3.44%.  Withdrawals from deposit accounts for
the purchase of shares are not reflected in the pro forma adjustments.  As
discussed under "Use of Proceeds," the Company expects to retain a portion of
the net conversion proceeds, part of which will be lent to the ESOP to fund its
purchase of 8% of the shares issued in the conversion.  No effect has been given
in the pro forma stockholders' equity calculation for the assumed earnings on
the net proceeds. Historical and pro forma per share amounts have been
calculated by dividing historical and pro forma amounts by the indicated number
of shares.

     No effect has been given in the following table to the possible issuance of
any Contingent Shares.  For a detailed discussion of the circumstances under
which these shares would be issued, see "The Conversion -- Contingent Shares."

     THE STOCKHOLDERS' EQUITY INFORMATION IS NOT INTENDED TO REPRESENT THE FAIR
MARKET VALUE OF THE COMMON STOCK, OR THE CURRENT VALUE OF OUR ASSETS OR
LIABILITIES, OR THE AMOUNTS, IF ANY, THAT WOULD BE AVAILABLE FOR DISTRIBUTION TO
STOCKHOLDERS IN THE EVENT OF LIQUIDATION.  FOR ADDITIONAL INFORMATION REGARDING
THE LIQUIDATION ACCOUNT, SEE "THE CONVERSION -- EFFECTS OF CONVERSION TO STOCK
FORM ON DEPOSITORS AND BORROWERS OF NORTHFIELD FEDERAL SAVINGS -- LIQUIDATION
ACCOUNT" AND NOTE 12 TO THE FINANCIAL STATEMENTS.  THE PRO FORMA INCOME DERIVED
FROM THE ASSUMPTIONS SET FORTH ABOVE SHOULD NOT BE CONSIDERED INDICATIVE OF THE
ACTUAL RESULTS OF OUR OPERATIONS FOR ANY PERIOD.  SUCH PRO FORMA DATA MAY BE
MATERIALLY AFFECTED BY A CHANGE IN THE PRICE PER SHARE OR NUMBER OF SHARES TO BE
ISSUED IN THE CONVERSION AND BY OTHER FACTORS.

                                       12
<PAGE>
 
<TABLE>
<CAPTION>
                                                                         At or for the Year Ended December 31, 1997
                                                              --------------------------------------------------------------
                                                                                                                 Maximum as
                                                              Minimum of       Midpoint of      Maximum of      Adjusted, of
                                                                382,500          450,000          517,500          595,125
                                                                Shares           Shares           Shares           Shares
                                                               at $10.00        at $10.00        at $10.00        at $10.00
                                                               Per Share        Per Share        Per Share        Per Share
                                                              -----------      -----------      -----------      -----------
                                                                       (In thousands, except per share amounts)
                                                           
<S>                                                           <C>              <C>              <C>              <C> 
Gross offering proceeds...................................    $    3,825       $    4,500       $    5,175       $    5,951
Less estimated offering expenses..........................          (362)            (375)            (387)            (402)
                                                              ----------       ----------       ----------       ----------
  Estimated net offering proceeds.........................    $    3,463       $    4,125       $    4,788       $    5,549
                                                              ==========       ==========       ==========       ==========
 
Less:  Common stock acquired by ESOP......................    $     (306)      $     (360)      $     (414)      $     (476)
       Common stock acquired by MRP.......................          (153)            (180)            (207)            (238)
                                                              ----------       ----------       ----------       ----------
  Estimated investable net proceeds.......................    $    3,004       $    3,585       $    4,167       $    4,835
                                                              ==========       ==========       ==========       ==========
                                                                    
Net income:                                                         
  Historical net income...................................    $      145       $      145       $      145       $      145
  Pro forma income on net proceeds........................           103              123              143              166
  Pro forma ESOP adjustment(1)............................           (16)             (19)             (22)             (25)
  Pro forma MRP adjustment(2).............................           (19)             (22)             (26)             (30)
                                                              ----------       ----------       ----------       ----------
    Total.................................................    $      214       $      227       $      241       $      257
                                                              ==========       ==========       ==========       ==========
                                                                    
Net income per share:(3)                                          
  Historical net income...................................    $      .41       $      .35       $      .30       $      .26
  Pro forma income on net proceeds........................           .29              .29              .30              .30
  Pro forma ESOP adjustment(1)............................          (.04)            (.05)            (.05)            (.04)
  Pro forma MRP adjustment(2).............................          (.05)            (.05)            (.05)            (.05)
                                                              ----------       ----------       ----------       ----------
    Total(3)..............................................    $      .60       $      .54       $      .50       $      .47
                                                              ==========       ==========       ==========       ==========
                                                                    
Number of shares used in calculating earnings                       
  per share...............................................       354,450          417,000          479,550          551,483
                                                              ==========       ==========       ==========       ==========
                                                                    
Stockholders' equity:(4)                                           
  Historical..............................................    $    2,894       $    2,894       $    2,894       $    2,894
  Estimated net offering proceeds(2)......................         3,463            4,125            4,788            5,549
   Less:  Common stock acquired by ESOP(1)................          (306)            (360)            (414)            (476)
          Common stock acquired by MRP(2).................          (153)            (180)            (207)            (238)
                                                              ----------       ----------       ----------       ----------
    Total.................................................    $    5,898       $    6,479       $    7,061       $    7,729
                                                              ==========       ==========       ==========       ==========
                                                                          
Stockholders' equity per share:(3)(4)                                    
  Historical..............................................    $     7.56       $     6.43       $     5.59       $     4.86
  Estimated net offering proceeds.........................          9.04             9.17             9.24             9.33
   Less:  Common stock acquired by ESOP(1)................          (.80)            (.80)            (.80)            (.80)
          Common stock acquired by MRP(2).................          (.40)            (.40)            (.40)            (.40)
                                                              ----------       ----------       ----------       ----------
    Total.................................................    $    15.40       $    14.40       $    13.63       $    12.99
                                                              ==========       ==========       ==========       ==========
                                                                           
Offering price as a percentage of pro forma                                
  stockholders' equity per share(4).......................          64.9%            69.4%            73.3%            77.0%
                                                              ==========       ==========       ==========       ==========
Ratio of offering price to pro forma                                       
  annualized net income per share(4)......................          16.7             18.5             20.0             21.3
                                                              ==========       ==========       ==========       ==========
Number of shares used in calculating                                       
  equity per share(4).....................................       382,500          450,000          517,500          595,125
                                                              ==========       ==========       ==========       ==========
</TABLE>

                                                  (Footnotes on succeeding page)

                                       13
<PAGE>
 
(footnotes continued from preceding page)

- -------------------------
(1)    Assumes the ESOP purchases 8% of the shares sold in the conversion and
       the Company lends the ESOP the funds to do so. The approximate amount
       expected to be borrowed by the ESOP is reflected as a reduction of
       capital. We intend to make annual contributions to the ESOP over a 
       12 year period in an amount at least equal to the principal and interest
       requirement of the debt. The pro forma net income assumes: (i) the ESOP
       loan is payable over 12 years, (ii) the average fair value of the ESOP
       shares is $10.00 per share in accordance with Statement of Position
       ("SOP") 93-6 of the American Institute of Certified Public Accountants
       ("AICPA"), and (iii) the effective tax rate was 38% for such period. The
       pro forma stockholders' equity per share calculation assumes all ESOP
       shares were outstanding, regardless of whether such shares would have
       been released. Because the Company will be providing the ESOP loan, only
       principal payments on the ESOP loan are reflected as employee
       compensation and benefits expense.

(2)    Assumes the Company issues 4% of the shares sold in the offering to the
       MRP and the purchase price for the shares purchased by the MRP was equal
       to the purchase price of $10.00 per share and 20% of the amount
       contributed was an amortized expense during such period. As we accrue
       compensation expense to reflect the five-year vesting period of such
       shares pursuant to the MRP, the charge against capital will be reduced
       accordingly. In calculating the pro forma effect of the MRP, an effective
       state and federal income tax rate of 38% has been assumed. Implementation
       of the MRP within one year of conversion would require regulatory and
       stockholder approval at a meeting of our stockholders to be held no
       earlier than six months after the conversion. For purposes of this table,
       it is assumed that the MRP will be adopted by the board of directors,
       reviewed by the OTS, and approved by the stockholders, and that the MRP
       will purchase the shares in the open market within the year following the
       conversion. If the shares to be purchased by the MRP are assumed at
       January 1, 1997, to be newly issued shares purchased from the Company at
       the minimum, midpoint, maximum and maximum as adjusted, of the Estimated
       Valuation Range, pro forma stockholders' equity per share would have been
       $15.21, $14.23, $13.50, and $12.87 at December 31, 1997, respectively. As
       a result of the MRP, stockholders' interests will be diluted by
       approximately 4%. See "Management of Northfield Federal Savings-Proposed
       Future Stock Benefit Plans - Management Recognition Plan."

(3)    Per share data has been computed based on the assumed numbers of shares
       sold in the conversion. This treatment is in accordance with SOP 93-6. No
       effect has been given to shares to be reserved for issuance pursuant to
       the Option Plan.

(4)    Consolidated stockholders' equity represents the excess of the carrying
       value of the assets over its liabilities. The calculations are based upon
       the number of shares issued in the conversion, without giving effect to
       SOP 93-6. The amounts shown do not reflect the federal income tax
       consequences of the potential restoration to income of the tax bad debt
       reserves for income tax purposes, which would be required in the event of
       liquidation. The amounts shown also do not reflect the amounts required
       to be distributed in the event of liquidation to eligible depositors from
       the liquidation account which will be established upon the consummation
       of the conversion. Pro forma stockholders' equity information is not
       intended to represent the fair market value of the shares, the current
       value of our assets or liabilities or the amounts, if any, that would be
       available for distribution to stockholders in the event of liquidation.
       Such pro forma data may be materially affected by a change in the number
       of shares to be sold in the conversion and by other factors.

                                       14
<PAGE>
 
                                THE CONVERSION

     THE OTS HAS APPROVED THE PLAN OF CONVERSION (THE "PLAN") SUBJECT TO THE
PLAN'S APPROVAL BY OUR MEMBERS AT A SPECIAL MEETING OF MEMBERS, AND SUBJECT TO
THE SATISFACTION OF CERTAIN OTHER CONDITIONS IMPOSED BY THE OTS IN ITS APPROVAL.
OTS APPROVAL, HOWEVER, DOES NOT CONSTITUTE A RECOMMENDATION OR ENDORSEMENT OF
THE PLAN BY THE OTS.


General

     On December 17, 1997 our board of directors adopted a plan of conversion,
pursuant to which we will convert from a federally chartered mutual savings
association to a federally chartered stock savings bank and become a wholly
owned subsidiary of the Company and will adopt the name "Northfield Federal
Savings Bank."  The Plan was amended on March __, 1998.  The conversion will
include adoption of the proposed Federal Stock Charter and Bylaws which will
authorize the issuance of capital stock by us.  Under the Plan, our capital
stock is being sold to the Company and the common stock of the Company is being
offered to our customers and then to the public.

     The OTS has approved the Company's application to become a savings and loan
holding company and to acquire all of our capital stock to be issued in the
conversion.  Pursuant to such OTS approval, the Company plans to retain a
portion of the net proceeds from the sale of shares of common stock and to use
the remainder to purchase all of the capital stock we will issue in the
conversion.

     The shares are first being offered in a Subscription Offering to holders of
subscription rights. To the extent shares of common stock remain available after
the Subscription Offering, we may offer shares of common stock in a Community
Offering.  The Community  Offering, if any, may begin any time subsequent to the
beginning of the Subscription Offering.  Shares not subscribed for in the
Subscription and Community Offerings may be offered for sale by the Company in a
Syndicated Community Offering.  We have the right, in our sole discretion, to
accept or reject, in whole or in part, any orders to purchase shares of common
stock received in the Community and Syndicated Community Offering.  See "--
Community Offering" and  "-- Syndicated Community Offering."

     We must sell common stock in an amount equal to our pro forma market value
as a stock savings institution in order for the conversion to become effective.
We must complete the Community Offering within 45 days after the last day of the
Subscription Offering, unless we extend such period and obtain the approval of
the OTS to do so.  The Plan provides that the conversion must be completed
within 24 months after the date of the approval of the Plan by our members.

     In the event that we are unable to complete the sale of common stock and
complete the conversion within 45 days after the end of the Subscription
Offering, we may request an extension of the period by the OTS.  We cannot
assure you that the extension would be granted if requested, nor can we assure
you  that our valuation would not substantially change during any such
extension. 

                                       15
<PAGE>
 
If the Estimated Valuation Range of the shares must be amended, we cannot assure
that the OTS would approve such amended Estimated Valuation Range. Therefore, it
is possible that if the conversion cannot be completed within the requisite
period of time, we may not be permitted to complete the conversion. A
substantial delay caused by an extension of the period may also significantly
increase the expense of the conversion. We cannot sell any shares of common
stock unless the Plan is approved by our members.

     The completion of the offering is subject to market conditions and other
factors beyond our control.  We cannot give you any assurances as to the length
of time following approval of the Plan at the meeting of our members that will
be required to complete the Community Offering or other sale of the shares being
offered in the conversion.  If we experience delays, our Estimated Valuation
Range value upon conversion could change significantly, together with
corresponding changes in the offering price and the net proceeds to be realized
by us from the sale of the shares.  In the event we terminate the conversion, we
would be required to charge all conversion expenses against current income and
promptly return any funds collected by us in the offering to each potential
investor, plus interest at the prescribed rate.

Effects of Conversion to Stock Form on Depositors and Borrowers of Northfield
Federal Savings

     Voting Rights.  Currently in our mutual form, our depositor and borrower
members have voting rights and may vote for the election of directors.
Following the conversion, depositors and borrower members will cease to have
voting rights.

     Savings Accounts and Loans.  The conversion will not affect the balances,
terms and FDIC insurance coverage of savings accounts, nor will the amounts and
terms of loans and obligations of the borrowers under their individual
contractual arrangements with us be affected.

     Tax Effects.  We have received an opinion from our counsel, Housley
Kantarian & Bronstein,  P.C. on the material federal tax consequences of the
conversion.  We have filed the opinion as an exhibit to the registration
statement of which this prospectus is a part.  The opinion provides, in part,
that,:  (i) the conversion will qualify as a reorganization under 
Section 368(a)(1)(F) of the Code, and we will not recognize any taxable gain in
either our mutual form or our stock form as a result of the proposed conversion;
(ii) we will not recognize any taxable gain upon the receipt of money from the
Company for our stock, nor will the Company recognize any gain upon the receipt
of money for the common stock; (iii) our assets in either our mutual or our
stock form will have the same basis before and after the conversion; (iv) the
holding period of our assets will include the period during which the assets
were held by us in our mutual form prior to conversion; (v) no gain or loss will
be recognized by the Eligible Account Holders, Supplemental Eligible Account
Holders, and Other Members upon the issuance to them of withdrawable savings
accounts in us in the stock form in the same dollar amount as their savings
accounts in us in the mutual form plus an interest in the liquidation account of
us in the stock form in exchange for their savings accounts in us in the mutual
form; (vi) depositors will recognize gain or loss upon the receipt of
liquidation

                                       16
<PAGE>
 
rights and the receipt of subscription rights in the conversion, to the extent
such liquidation rights and subscription rights are deemed to have value, as
discussed below; (vii) the basis of each account holder's savings accounts in us
after the conversion will be the same as the basis of his savings accounts in us
prior to the conversion, decreased by the fair market value of the
nontransferable subscription rights received and increased by the amount, if
any, of gain recognized on the exchange; (viii) the basis of each account
holder's interest in the liquidation account will be zero; and (ix) the holding
period of the common stock acquired through the exercise of subscription rights
shall begin on the date on which the subscription rights are exercised.

     With respect to the subscription rights, we have received an opinion of
Ferguson which, based on certain assumptions, concludes that the subscription
rights to be received by Eligible Account Holders and other eligible subscribers
do not have any economic value at the time of distribution or at the time the
subscription rights are exercised, whether or not a public offering takes place.
Such opinion is based on the fact that such rights are: (i) acquired by the
recipients without payment therefor, (ii) non-transferable, (iii) of short
duration, and (iv) afford the recipients the right only to purchase shares at a
price equal to their estimated fair market value, which will be the same price
at which shares for which no subscription right is received in the Subscription
Offering will be offered in the Community Offering.  If the subscription rights
granted to Eligible Account Holders or other eligible subscribers are deemed to
have an ascertainable value, receipt of such rights would be taxable only to
those Eligible Account Holders or other eligible subscribers who exercise the
subscription rights in an amount equal to such value (either as a capital gain
or ordinary income), and we could recognize gain on such distribution.

     We are also subject to Maryland income taxes and have received an opinion
from Anderson Associates, LLP that the conversion will be treated for Maryland
state tax purposes similar to the conversion's treatment for federal tax
purposes.

     Unlike a private letter ruling, the opinions of Housley Kantarian &
Bronstein, P.C., Ferguson and Anderson Associates, LLP have no binding effect or
official status, and we cannot give you any assurance that a court would sustain
the conclusions reached in any of those opinions if contested by the IRS or the
Maryland tax authorities.  WE ENCOURAGE ELIGIBLE ACCOUNT HOLDERS, SUPPLEMENTAL
ELIGIBLE ACCOUNT HOLDERS, AND OTHER MEMBERS TO CONSULT WITH THEIR OWN TAX
ADVISERS AS TO THE TAX CONSEQUENCES IN THE EVENT THE SUBSCRIPTION RIGHTS ARE
DEEMED TO HAVE AN ASCERTAINABLE VALUE.

     Liquidation Account.  In the unlikely event of our complete liquidation in
our present mutual form, each depositor is entitled to equal distribution of any
of our assets, pro rata to the value of his accounts, remaining after payment of
claims of all creditors (including the claims of all depositors to the
withdrawal value of their accounts).  Each depositor's pro rata share of such
remaining assets would be in the same proportion as the value of his deposit
accounts was to the total value of all deposit accounts in us at the time of
liquidation.

                                       17
<PAGE>
 
     Upon a complete liquidation after the conversion, each depositor would have
a claim, as a creditor, of the same general priority as the claims of all other
general creditors of ours.  Therefore, except as described below, a depositor's
claim would be solely in the amount of the balance in his deposit account plus
accrued interest.  A depositor would not have an interest in the residual value
of our assets above that amount if any.

     The Plan provides for the establishment, upon the completion of the
conversion, of a special "liquidation account" for the benefit of Eligible
Account Holders and Supplemental Eligible Account Holders in an amount equal to
our regulatory capital as reflected in the latest statement of financial
condition in the Prospectus.  Each Eligible Account Holder and Supplemental
Eligible Account Holder, if he continues to maintain his deposit account with
us, would be entitled on a complete liquidation of us after conversion, to an
interest in the liquidation account prior to any payment to stockholders.  Each
Eligible Account Holder would have an initial interest in such liquidation
account for each deposit account held in us on the qualifying date, December 31,
1995.  Each Supplemental Eligible Account Holder would have a similar interest
as of the qualifying date, March 31, 1998.  The interest as to each deposit
account would be in the same proportion of the total liquidation account as the
balance of the deposit account on the qualifying dates was to the aggregate
balance in all the deposit accounts of Eligible Account Holders and Supplemental
Eligible Account Holders on such qualifying dates.  However, if the amount in
the deposit account on any annual closing date of ours is less than the amount
in such account on the respective qualifying dates, then the interest in this
special liquidation account would be reduced from time to time by an amount
proportionate to any such reduction, and the interest would cease to exist if
such deposit account were closed.  The interest in the special liquidation
account will never be increased despite any increase in the related deposit
account after the respective qualifying dates.

     No merger, consolidation, purchase of bulk assets with assumptions of
savings accounts and other liabilities, or similar transactions with another
insured institution in which transaction we, in our converted form, are not the
surviving institution shall be considered a complete liquidation.  In such
transactions, the liquidation account shall be assumed by the surviving
institution.

Subscription Rights and the Subscription Offering

     In accordance with OTS regulations, non-transferable subscription rights to
purchase shares of the common stock have been granted to all persons and
entities entitled to purchase shares in the Subscription Offering under the
Plan.  The number of shares which these parties may purchase will be determined,
in part, by the total number of shares to be issued and by the availability of
the shares for purchase under the categories set forth in the Plan.  If the
Community Offering, as described below, extends beyond 45 days following the
completion of the Subscription Offering, we will resolicit subscribers and
permit them to increase, decrease or rescind their orders.  Subscription
priorities have been established for the allocation of stock to the extent that
shares are available after satisfaction of all subscriptions of all persons
having prior rights and subject to the maximum and minimum purchase limitations
set forth in the Plan and as described below under " -- Limitations on Purchases
of Shares." The following priorities have been established:

                                       18
<PAGE>
 
     Category 1: Eligible Account Holders.  Each depositor qualifying as an
Eligible Account Holder (which collectively encompasses all names on a joint
account) will receive non-transferable subscription rights on a priority basis
to purchase 12,500 shares ($125,000); provided, however, that stock purchases in
the conversion by any person, when aggregated with purchases by associates of
and persons acting in concert with that person, may not exceed the lesser of
$225,000 of conversion stock or 5% of the shares of stock issued in the
conversion, excluding Contingent Shares.  Under our Plan of Conversion, a person
will not qualify as more than one Eligible Account Holder by virtue of multiple
deposit accounts held in his or her name.   If there are insufficient shares to
satisfy the orders of all Eligible Account Holders, shares shall be allocated
among subscribing Eligible Account Holders so as to permit each such account
holder, to the extent possible, to purchase the lesser of 100 shares or the
total amount of his subscription.  Any shares remaining shall be allocated among
the subscribing Eligible Account Holders on an equitable basis, related to the
amounts of their respective qualifying deposits as compared to the total
qualifying deposits of all subscribing Eligible Account Holders.  Subscription
rights received by officers and directors in this category based on their
increased deposits in us in the one-year period preceding December 31, 1995, are
subordinated to the subscription rights of other Eligible Account Holders.  See
" -- Limitations on Purchases and Transfer of Shares."

     Category 2: ESOP. The ESOP has been granted subscription rights to purchase
up to 10% of the total shares issued in the conversion.

     Although the right of the ESOP to subscribe for shares is subordinate to
the right of the Eligible Account Holders, in the event the offering results in
the issuance of shares above the maximum of the Estimated Valuation Range (i.e.,
more than 517,500 shares), the ESOP has a priority right to fill its
subscription. The ESOP currently intends to purchase up to 8.0% of the common
stock issued in the conversion (excluding any Contingent Allocation Shares which
may be issued).  The ESOP may, however, determine to purchase some or all of the
shares covered by its subscription after the conversion in the open market or,
if approved by the OTS, out of authorized but unissued shares in the event of an
over subscription.

     Category 3: Supplemental Eligible Account Holders.  Each depositor
qualifying as a Supplemental Eligible Account Holder (which collectively
encompasses all names on a joint account) who is not an Eligible Account Holder
will receive non-transferable subscription rights to purchase that number of
shares which is equal to 12,500 shares ($125,000); provided, however, that total
stock purchases in the conversion by any person, when aggregated with purchases
by associates of and persons acting in concert with that person, may not exceed
the lesser of $225,000 of conversion stock or 5% of the shares of stock issued
in the conversion, excluding Contingent Shares.  If the allocation made in this
paragraph results in an over subscription, shares shall be allocated among
subscribing Supplemental Eligible Account Holders so as to permit each such
account holder, to the extent possible, to purchase the lesser of 100 shares or
the total amount of his subscription.  Any shares not so allocated shall be
allocated among the subscribing Supplemental Eligible Account Holders on an
equitable basis, related to the amounts of their respective qualifying 

                                       19
<PAGE>
 
deposits as compared to the total qualifying deposits of all subscribing
Supplemental Eligible Account Holders. See "-- Limitations on Purchases and
Transfer of Shares."

     The right of Supplemental Eligible Account Holders to subscribe for shares
is subordinate to the rights of the Eligible Account Holders and the ESOP to
subscribe for shares.

     Category 4: Other Members.  Each Other Member (which collectively
encompasses all names on a joint account) who is not an Eligible Account Holder
or Supplemental Eligible Account Holder, will receive non-transferable
subscription rights to purchase up to 12,500 shares ($125,000) to the extent
such shares are available following subscriptions by Eligible Account Holders,
the ESOP, and Supplemental Eligible Account Holders ; provided, however, that
total stock purchases in the conversion by any person, when aggregated with
purchases by associates of and persons acting in concert with that person, may
not exceed the lesser of $225,000 of conversion stock or 5% of the shares of
stock issued in the conversion, excluding Contingent Shares.  In the event there
are not enough shares to fill the orders of the Other Members, the subscriptions
of the Other Members will be allocated so that each subscribing Other Member
will be entitled to purchase the lesser of 100 shares or the number of shares
ordered.  Any remaining shares will be allocated among Other Members whose
subscriptions remain unsatisfied on a reasonable basis.  See "-- Limitations on
Purchases and Transfer of Shares."

     Members in Non-Qualified States.  We will make reasonable efforts to comply
with the securities laws of all states in the United States in which persons
entitled to subscribe for the shares pursuant to the Plan reside.  However, no
person will be offered or allowed to purchase any shares under the Plan if he
resides in a foreign country or in a state with respect to which any of the
following apply: (i) a small number of persons otherwise eligible to subscribe
for shares under the Plan reside in that state or foreign country; (ii) the
granting of subscription rights or offer or sale of shares of common stock to
those persons would require either us, or our employees to register, under the
securities laws of that state or foreign country, as a broker or dealer or to
register or otherwise qualify our securities for sale in that state or foreign
country; or (iii) such registration or qualification would be impracticable for
reasons of cost or otherwise.  We will not make any payment in lieu of the
granting of subscription rights to any person.

     Restrictions on Transfer of Subscription Rights and Shares.  Persons are
prohibited from transferring or entering into any agreement or understanding to
transfer the legal or beneficial ownership of their subscription rights.  Only
the person to whom they are granted may exercise subscription rights and only
for his account.  Each person subscribing for shares will be required to certify
that he is purchasing shares solely for his own account and has not entered into
an agreement or understanding regarding the sale or transfer of those shares.
The regulations also prohibit any person from offering or making an announcement
of an offer or intent to make an offer to purchase subscription rights or shares
of common stock prior to the completion of the conversion.

                                       20
<PAGE>
 
    We will pursue any and all legal and equitable remedies in the event we
become aware of the transfer of subscription rights and will not honor orders
believed by us to involve the transfer of subscription rights.

     Expiration Date.  The Subscription Offering will expire at __:__ .m.,
Eastern Time, on ___________, 1998.  Subscription rights will become void if not
exercised prior to the Expiration Date.

Community Offering

    To the extent that shares remain available for purchase after filling all
orders received in the Subscription Offering, we may offer shares of common
stock to certain members of the general public with a preference to natural
persons residing in Baltimore County, Maryland under such terms and conditions
as may be established by the board of directors.  In the Community Offering, the
minimum purchase is 25 shares, and no person, together with associates of and
persons acting in concert with such persons, may purchase more than 12,500
shares ($125,000).

     WE MAY BEGIN THE COMMUNITY OFFERING AT ANY TIME AFTER THE SUBSCRIPTION
OFFERING HAS BEGUN.  THE COMMUNITY OFFERING, ONCE COMMENCED, MAY EXPIRE AT ANY
TIME WITHOUT NOTICE BUT NO LATER THAN __:__ .M., EASTERN TIME, ON ___________,
1998 UNLESS WE EXTEND IT WITH THE PERMISSION OF THE OTS.  PURCHASES OF SHARES IN
THE COMMUNITY OFFERING ARE SUBJECT TO OUR RIGHT IN OUR SOLE DISCRETION, TO
ACCEPT OR REJECT SUCH PURCHASES IN WHOLE OR IN PART EITHER AT THE TIME AND
RECEIPT OF AN ORDER, OR AS SOON AS PRACTICABLE FOLLOWING THE COMPLETION.

     In the event Community Offering orders are not filled, we will promptly
refund funds received by us with interest at our passbook rate.  In the event an
insufficient number of shares are available to fill all orders in the Community
Offering, the available shares will be allocated on an equitable basis
determined by the board of directors, provided however that a preference will be
given to natural persons residing in Baltimore County, Maryland.  If regulatory
approval is received to extend the Community Offering beyond 45 days following
the completion of the Subscription Offering, subscribers will be resolicited.
Shares sold in the Community Offering will be sold at $10.00 per share.

Syndicated Community Offering

     The Plan provides that, if necessary, we may offer shares of common stock
not purchased in the Subscription and Community Offerings for sale to the
general public in a Syndicated Community Offering through a syndicate of
selected dealers to be formed and managed by Trident Securities.  No individual
purchaser together with any associate or group of persons acting in concert may
purchase more than 12,500 shares ($125,000).    Neither Trident Securities nor
any registered broker-dealer will be obligated to take or purchase any shares in
the Syndicated Community Offering, although Trident Securities has agreed to use
its best efforts in the sales of shares in any 

                                       21
<PAGE>

Syndicated Community Offering. Shares sold in the Syndicated Community Offering
will be sold at the Purchase Price. See "-- Stock Pricing,"

     The Syndicated Community Offering will terminate no more than 45 days
following the Expiration Date, unless the Company extends it with the approval
of the OTS.

Limitations on Purchases and Transfer of Shares

    The Plan provides for certain additional limitations to be placed upon the
purchase of the shares in the conversion.  The minimum purchase is 25 shares.
No persons, together with associates, or group of persons acting in concert, may
purchase more than 22,500 shares ($225,000), except for the ESOP which may
purchase up to 10% of the shares sold.  The OTS regulations governing the
conversion provide that officers and directors and their associates may not
purchase, in the aggregate, more than 35% of the shares issued pursuant to the
conversion.

     Depending on market conditions and the results of the offering, the board
of directors may increase or decrease any of the purchase limitations without
the approval of our members and without resoliciting subscribers.  If the
maximum purchase limitation is increased, persons who ordered the maximum amount
will be given the first opportunity to increase their orders.  In doing so, the
preference categories in the offerings will be followed.

    In the event of an increase in the total number of shares offered in the
conversion due to an increase in the Estimated Valuation Range of up to 15% (the
"Adjusted Maximum"), the additional shares will be allocated in the following
order of priority: (i) to fill the ESOP's subscription of up to 8% of the
Adjusted Maximum number of shares (the ESOP currently intends to subscribe for
8%); (ii) in the event that there is an over subscription by Eligible Account
Holders, to fill unfulfilled subscriptions of Eligible Account Holders exclusive
of the Adjusted Maximum; (iii) in the event that there is an over subscription
by Supplemental Eligible Account Holders, to fill unfulfilled subscriptions to
Supplemental Eligible Account Holders exclusive of the Adjusted Maximum; (iv) in
the event that there is an over subscription by Other Members, to fill
unfulfilled subscriptions of Other Members exclusive of the Adjusted Maximum;
and (v) to fill unfulfilled subscriptions in the Community Offering to the
extent possible, exclusive of the Adjusted Maximum.

     The term "associate" of a person means (i) any corporation or organization
(other than us or a majority-owned subsidiary of ours) of which such person is
an officer or partner or is, directly or indirectly, the beneficial owner of 10%
or more of any class of equity securities, (ii) any trust or other estate in
which such person has a substantial beneficial interest or as to which such
person serves as trustee or in a similar fiduciary capacity (excluding tax-
qualified employee stock benefit plans), and (iii) any relative or spouse of
such person or any relative of such spouse, who has the same home as such person
or who serves as a director for us or any of our subsidiaries.  For example, a
corporation of which a person serves as an officer would be an associate of that
person, and therefore all shares purchased by that corporation would be included
with the number of shares which that person individually could purchase under
the above limitations.

                                       22
<PAGE>
 
     The term "officer" may include our chairman of the board, president, vice
presidents in charge of principal business functions, Secretary and Treasurer
and any other person performing similar functions.  All references herein to an
officer have the same meaning as used for an officer in the Plan.

     The term "residing," as used in relation to the preference afforded natural
persons in Baltimore County, Maryland, means any natural person who occupies a
dwelling within Baltimore County, has an intention to remain within Baltimore
County (manifested by establishing a physical, on-going, non-transitory presence
within Baltimore County), and continues to reside in Baltimore County at the
time of the offering.  We may utilize deposit or loan records or such other
evidence provided to us to make the determination whether a person is residing
in Baltimore County.  Such determination will be in our sole discretion.

     TO ORDER SHARES IN THE CONVERSION, PERSONS MUST CERTIFY THAT THEIR PURCHASE
DOES NOT CONFLICT WITH THE PURCHASE LIMITATIONS.  IN THE EVENT THAT THE PURCHASE
LIMITATIONS ARE VIOLATED BY ANY PERSON (INCLUDING ANY ASSOCIATE OR GROUP OF
PERSONS AFFILIATED OR OTHERWISE ACTING IN CONCERT WITH SUCH PERSONS), WE WILL
HAVE THE RIGHT TO PURCHASE FROM THAT PERSON AT $10.00 PER SHARE ALL SHARES
ACQUIRED BY THAT PERSON IN EXCESS OF THE PURCHASE LIMITATIONS.  IF THE EXCESS
SHARES HAVE BEEN SOLD BY THAT PERSON, WE MAY RECOVER THE PROFIT FROM THE SALE OF
THE SHARES BY THAT PERSON.  WE MAY ASSIGN OUR RIGHT EITHER TO PURCHASE THE
EXCESS SHARES OR TO RECOVER THE PROFITS FROM THEIR SALE.

     Shares of common stock purchased pursuant to the conversion will be freely
transferable, except for shares purchased by our directors and officers.  For
certain restrictions on the shares purchased by directors and officers, see " --
Restrictions on Sales and Purchases of Shares by Directors and Officers."  In
addition, under guidelines of the NASD, members of the NASD and their associates
are subject to certain restrictions on the transfer of securities purchased in
accordance with subscription rights and to certain reporting requirements upon
purchase of such securities.

Contingent Shares

     For a period of 30 days following the closing of the conversion, the
Company's board of directors may determine to issue up to an additional 3% of
the shares issued in the conversion. These shares, the Contingent Shares, may be
issued if necessary in the discretion of the Company's board of directors, to
fill orders resulting from allocation oversights resulting in an
oversubscription, lost or damaged stock order forms which the board determines
legitimately should have been filled during the conversion, or orders initially
rejected but later found to be legitimate. Any Contingent Shares issued will not
be included in the total number of shares for purposes of determining the level
of stock to be purchased by the ESOP, MRP or stock options, and commissions will
not be payable to Trident Securities on these shares.  Contingent Shares will be
allocated to a subscriber based on the allocation of shares to persons who had
the same or similar deposit account balance as that subscriber.

                                       23
<PAGE>
 
Ordering and Receiving Shares

     Use of Order Forms.  Subscription rights to subscribe may only be exercised
by completion of an original order form.  Persons ordering shares in the
Subscription Offering must deliver by mail or in person a properly completed and
executed original order form to us prior to the Expiration Date.  Order forms
must be accompanied by full payment for all shares ordered.  See "-- Payment for
Shares."  Furthermore, to ensure your proper allocation of shares in the event
of an oversubscription, you must list all of your eligible accounts in the
appropriate space on the stock order form.  Your subscription rights under the
Plan will expire on the Expiration Date, whether or not we have been able to
locate each person entitled to subscription rights.  ONCE SUBMITTED,
SUBSCRIPTION ORDERS CANNOT BE REVOKED WITHOUT OUR CONSENT UNLESS THE CONVERSION
IS NOT COMPLETED WITHIN 45 DAYS OF THE EXPIRATION DATE.

     Persons and entities not purchasing shares in the Subscription Offering
may, subject to availability, purchase shares in the Community Offering by
returning to us a completed and properly executed order form along with full
payment for the shares ordered.

     In the event an order form (i) is not delivered and is returned to us by
the United States Postal Service or we are unable to locate the addressee, (ii)
is not received or is received after the Expiration Date, (iii) is defectively
completed or executed, or (iv) is not accompanied by full payment for the shares
subscribed for (including instances where a savings account or certificate
balance from which withdrawal is authorized is insufficient to fund the amount
of such required payment), the subscription rights for the person to whom such
rights have been granted will lapse as though that person failed to return the
completed order form within the time period specified.  We may, but will not be
required to, waive any irregularity on any order form or require the submission
of corrected order forms or the remittance of full payment for subscribed shares
by such date as we specify.  The waiver of an irregularity on an order form in
no way obligates us to waive any other irregularity on that, or any irregularity
on any other, order form.  Waivers will be considered on a case by case basis.
Photocopies of order forms, payments from private third parties, or electronic
transfers of funds will not be accepted.  Our interpretation of the terms and
conditions of the Plan and of the acceptability of the order forms will be
final.  We have the right to investigate any irregularity on any order form.

    To ensure that each purchaser receives a prospectus at least 48 hours before
the Expiration Date in accordance with Rule 15c2-8 of the Exchange Act, no
prospectus will be mailed any later than five days prior to such date or hand
delivered any later than two days prior to such date. Execution of the order
form will confirm receipt or delivery in accordance with Rule 15c2-8.  Order
forms will only be distributed with the Prospectus.

    Payment for Shares.  Payment for shares of common stock may be made (i) in
cash, if delivered in person, (ii) by check or money order, or (iii) by
authorization of withdrawal from savings accounts (including certificates of
deposit) maintained with us or (iv) by an IRA not held by us. Appropriate means
by which such withdrawals may be authorized are provided in the order form.
Once such a withdrawal has been authorized, none of the designated withdrawal
amount may 

                                       24
<PAGE>
 
be used by the subscriber for any purpose other than to purchase the shares.
Where payment has been authorized to be made through withdrawal from a savings
account, the sum authorized for withdrawal will continue to earn interest at the
contract rate until the conversion has been completed or terminated. Interest
penalties for early withdrawal applicable to certificate accounts will not apply
to withdrawals authorized for the purchase of shares; however, if a partial
withdrawal results in a certificate account with a balance less than the
applicable minimum balance requirement, the certificate evidencing the remaining
balance will earn interest at the passbook savings account rate subsequent to
the withdrawal. An executed order form, once received by us, may not be
modified, amended, or rescinded without our consent, unless the conversion is
not completed within 45 days after the conclusion of the Subscription Offering,
in which case subscribers may be given an opportunity to increase, decrease, or
rescind their order.

    Payments made in cash or by check or money order, will be placed in a
segregated saving account and will earn interest at our passbook savings account
rate from the date payment is received until the conversion is completed or
terminated.  In the event that the conversion is not consummated, all funds
submitted pursuant to the offering will be refunded promptly with interest.

     Owners of self-directed IRAs may use the assets of such IRAs to purchase
shares in the offering, provided that such IRAs are not maintained on deposit
with us.  Persons with IRAs maintained with us must have their accounts
transferred to an unaffiliated institution or broker to purchase shares in the
offering.  The Stock Information Center can assist you in transferring your
self-directed IRA.  Because of the paperwork involved, persons owning IRAs with
us who wish to use their IRA account to purchase stock in the Offering, must
contact the Stock Information Center no later than __________ __, 1998.

     Delivery of Stock Certificates.  Certificates representing shares of common
stock issued in the conversion will be mailed to the person(s) at the address
noted on the order form, as soon as practicable following consummation of the
conversion.  Any certificates returned as undeliverable will be held until
properly claimed or otherwise disposed.  Persons ordering shares might not be
able to sell their shares until they receive their stock certificates.

     FEDERAL REGULATIONS PROHIBIT US FROM LENDING FUNDS OR EXTENDING CREDIT TO
ANY PERSON TO PURCHASE SHARES IN THE CONVERSION.

Marketing Arrangements

     We have engaged Trident Securities as our financial advisor in connection
with the offering. Trident Securities has agreed to exercise its best efforts to
assist us in the sale of the shares in the Subscription and Community Offerings.
As compensation, Trident Securities will receive a variable fee of two percent
of the dollar amount of the common stock sold in the conversion, excluding
shares sold to our directors and executive officers and their associates and
shares sold to our ESOP.  If shares are offered for sale in a Syndicated
Community Offering, Trident Securities will organize and manage the syndicate of
selected broker-dealers.  The commission to be paid to any such selected broker-
dealers will be at a rate to be agreed to jointly by Trident Securities and us.
Fees paid to 

                                       25
<PAGE>
 
Trident Securities and to any other broker-dealer may be deemed to be
underwriting fees, and Trident Securities and such broker-dealers may be deemed
to be underwriters. Trident Securities will also be reimbursed for allocable
expenses incurred by them, including legal fees. Trident's reimbursable out-of-
pocket expenses other than legal fees will not exceed $10,000 and its
reimbursable legal fees will not exceed $28,000. We have agreed to indemnify
Trident Securities for reasonable costs and expenses in connection with certain
claims or liabilities which might be asserted against Trident Securities.

     The shares will be offered principally by the distribution of this document
and through activities conducted at a Stock Information Center located at our
office.  The Stock Information Center is expected to operate during our normal
business hours throughout the offering.  A registered representative employed by
Trident Securities will be working at, and supervising the operation of, the
Stock Information Center.  Trident Securities will assist us in responding to
questions regarding the conversion and the offering and processing order forms.
Our personnel will be present in the Stock Information Center to assist Trident
Securities with clerical matters and to answer questions related solely to our
business.

Stock Pricing

     We have retained Ferguson, an independent economic consulting and appraisal
firm, which is experienced in the evaluation and appraisal of business entities,
including savings institutions involved in the conversion process to prepare an
appraisal of our estimated pro forma market value. We will pay Ferguson  a fee
of $20,000 for preparing the appraisal and will reimburse Ferguson for
reasonable out-of-pocket expenses. We have agreed to indemnify Ferguson under
certain circumstances against liabilities and expenses arising out of or based
on any misstatement or untrue statement of a material fact contained in the
information supplied by us to Ferguson.

    Ferguson prepared the appraisal in reliance upon the information contained
herein, including the financial statements.  The appraisal contains an analysis
of a number of factors including, but not limited to, our financial condition
and operating trends, the competitive environment within which we operate,
operating trends of certain savings institutions and savings and loan holding
companies, relevant economic conditions, both nationally and in the state of
Maryland which affect the operations of savings institutions, and stock market
values of certain savings institutions.  In addition, Ferguson has advised us
that it has considered the effect of the additional capital raised by the sale
of the shares on our estimated aggregate pro forma market value.

    On the basis of the above, Ferguson has determined, in its opinion, that as
of February 27, 1998 our estimated aggregate pro forma market value was
$4,500,000.  OTS regulations require, however, that the appraiser establish a
range of value for the stock to allow for fluctuations in the aggregate value of
the stock due to changing market conditions and other factors.  Accordingly,
Ferguson has established the Estimated Valuation Range from $3,825,000 to
$5,175,000 for the offering.  The Estimated Valuation Range will be updated
prior to consummation of the conversion 

                                       26
<PAGE>
 
and the Estimated Valuation Range may increase to $5,951,250 (excluding the
value of any Contingent Shares which may be issued).

    The board of directors has reviewed the independent appraisal, including
the stated methodology of the independent appraiser and the assumptions used in
the preparation of the independent appraisal.  The board of directors is relying
upon the expertise, experience and independence of the appraiser and is not
qualified to determine the appropriateness of the assumptions.

     In order for stock sales to take place, Ferguson must confirm to the OTS
that, to the best of Ferguson's knowledge and judgment, nothing of a material
nature has occurred which would cause Ferguson to conclude that the Purchase
Price on an aggregate basis was incompatible with Ferguson's estimate of our pro
forma  market value of us in converted form at the time of the sale. If,
however, the facts do not justify such a statement, an amended Estimated
Valuation Range may be established.

     THE APPRAISAL IS NOT A RECOMMENDATION OF ANY KIND AS TO THE ADVISABILITY OF
PURCHASING THESE SHARES.  IN PREPARING THE APPRAISAL, FERGUSON HAS RELIED UPON
AND ASSUMED THE ACCURACY AND COMPLETENESS OF FINANCIAL AND STATISTICAL
INFORMATION PROVIDED BY US.  FERGUSON DID NOT INDEPENDENTLY VERIFY THE FINANCIAL
STATEMENTS AND OTHER INFORMATION PROVIDED BY US, NOR DID FERGUSON VALUE
INDEPENDENTLY OUR ASSETS AND LIABILITIES.  THE APPRAISAL CONSIDERS US ONLY AS A
GOING CONCERN AND SHOULD NOT BE CONSIDERED AS OUR LIQUIDATION VALUE.  MOREOVER,
BECAUSE THE APPRAISAL IS BASED UPON ESTIMATES AND PROJECTIONS OF A NUMBER OF
MATTERS WHICH ARE SUBJECT TO CHANGE, THE MARKET PRICE OF THE COMMON STOCK COULD
DECLINE BELOW $10.00.

Change in Number of Shares to be Issued in the Conversion

     Depending on market and financial conditions at the time of the completion
of the Subscription and Community Offerings, we may significantly increase or
decrease the number of shares to be issued in the conversion.  In the event of
an increase in the valuation, we may increase the total number of shares to be
issued in the conversion.  An increase in the total number of shares to be
issued in the conversion would decrease a subscriber's percentage ownership
interest and the pro forma  net worth (book value) per share and increase the
pro forma net income and net worth (book value) on an aggregate basis.  In the
event of a material reduction in the valuation, we may decrease the number of
shares to be issued to reflect the reduced valuation.  A decrease in the number
of shares to be issued in the conversion would increase a subscriber's
percentage ownership interest and the pro forma net worth (book value) per share
and decrease pro forma net income and net worth on an aggregate basis.

    Persons ordering shares will not be permitted to modify or cancel their
orders unless the change in the number of shares to be issued in the conversion
results in an offering which is either less than $3,825,000 or more than
$5,951,250 (excluding the value of any Contingent Shares which may be issued).

                                       27
<PAGE>
 
Restrictions on Repurchase of Shares

    Generally, during the first year following the conversion, the Company may
not repurchase its shares and during each of the second and third years
following the conversion, the Company may repurchase five percent of the
outstanding shares provided they are purchased in open-market transactions.
Repurchases must not cause us to become undercapitalized and at least 10 days
prior notice of the repurchase must be provided to the OTS.  The OTS may
disapprove a repurchase program upon a determination that (i) the repurchase
program would adversely affect our financial condition, (ii) the information
submitted is insufficient upon which to base a conclusion as to whether the
financial condition would be adversely affected, or (iii) a valid business
purpose was not demonstrated.  In addition, SEC rules also govern the method,
time, price, and number of shares of common stock that may be repurchased by the
Company and affiliated purchasers.  If, in the future, the rules and regulations
regarding the repurchase of stock are liberalized, the Company may utilize the
rules and regulations then in effect.

Restrictions on Sales and Purchases of Shares by Directors and Officers

     Shares purchased by directors and officers of the Company may not be sold
for one year following completion of the conversion.  An exception to this rule
is a disposition of shares in the event of the death of the director or officer.
Any shares issued to directors and officers as a stock dividend, stock split, or
otherwise with respect to restricted stock shall be subject to the same
restrictions.

     For three years following the conversion, directors and officers may
purchase shares only through a registered broker or dealer.  Exceptions are
available only if the OTS has approved the purchase or the purchase is an arm's
length transaction and involves more than one percent of the outstanding shares.

Interpretation and Amendment of the Plan

     We are authorized to interpret and amend the Plan. Our interpretations are
final. Amendments to the Plan after the receipt of member approval will not need
further member approval unless required by the OTS.

Conditions and Termination

     Completion of the conversion requires (i) the approval of the Plan by the
affirmative vote of not less than a majority of the total number of votes
eligible to be cast by our members; and (ii) completion of the sale of shares
within 24 months following approval of the Plan by our members. If these
conditions are not satisfied, the Plan will be terminated and we will continue
our business in the mutual form of organization.  We may terminate the Plan at
any time prior to the meeting of members to vote on the Plan or at any time
thereafter with the approval of the OTS.

                                       28
<PAGE>
 
Other

     ALL STATEMENTS MADE IN THIS DOCUMENT ARE HEREBY QUALIFIED BY THE CONTENTS
OF THE PLAN OF CONVERSION, THE MATERIAL TERMS OF WHICH ARE SET FORTH HEREIN.
THE PLAN OF CONVERSION IS ATTACHED TO THE PROXY STATEMENT.  COPIES OF THE PLAN
ARE AVAILABLE FROM US AND WE SHOULD BE CONSULTED FOR FURTHER INFORMATION.
ADOPTION OF THE PLAN BY OUR MEMBERS AUTHORIZES US TO INTERPRET, AMEND OR
TERMINATE THE PLAN.

                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

    Management's discussion and analysis of financial condition and results of
operations is intended to assist you in understanding our financial condition
and results of operations. The information in this section should also be read
with our Financial Statements and Notes to the Financial Statements elsewhere in
this document.

    The Company has recently been formed and accordingly, has no results of
operations.  The following discussion relates only to our financial condition
and results of operations.

    Our results of operations depend primarily on net interest income, which is
determined by (i) the difference between rates of interest we earn on our
interest-earning assets and the rates we pay on interest-bearing liabilities
(interest rate spread), and (ii) the relative amounts of interest earning assets
and interest-bearing liabilities.  Our results of operations are also affected
by non-interest expense, including primarily compensation and employee benefits,
federal deposit insurance premiums and office occupancy costs.  Our results of
operations also are affected significantly by general and economic and
competitive conditions, particularly changes in market interest rates,
government policies and actions of regulatory authorities, all of which are
beyond our control.

    Following the conversion, we believe there will be sufficient demand in our
market area to continue our policy of emphasizing construction and permanent
lending in the one- to four-family real estate loan area.  In addition, we hope
to experience continued moderate growth in our other loan portfolios; however,
there is no assurance that we will be able to do so.

Year 2000 Compliance

    A great deal of information has been disseminated about the global computer
problem that may occur in the year 2000 which would affect the speed and
accuracy of the data processing that is essential to our operations.  We are
conducting a thorough review of our internal systems as well as the efforts of
our outside data processing service provider.  The progress of the plan is
monitored by our board of directors.  We began testing our internal PC based
applications beginning in February 1998.  While we believe that we will need to
replace several outdated teller terminal units, we do not expect to incur
significant costs to replace existing hardware or software.  The greatest
potential for problems, however, concerns the data processing provided by our
third party service bureau.  The 

                                       29
<PAGE>
 
service bureau is providing us with quarterly updates of its compliance progress
and has advised us that it expects to resolve this problem before the year 2000.
We are in the process of developing a contingency plan to deal with the
potential that our service bureau is unable to bring its systems into compliance
by September 30, 1998. We believe that we would be able to engage another
service provider if necessary if our current provider is unable to resolve this
problem in time. There can be no assurance in this regard, however, and it is
possible that as a result we could experience data processing delays, errors or
failures, all of which could have a significant adverse impact on our financial
condition and results of operations.

    In October 1997, the OTS performed an off-site examination of our year 2000
compliance efforts.  In January 1998, the OTS indicated that we have achieved
moderate progress toward achieving year 2000 compliance and that our management
and board have placed adequate emphasis on this issue.

Market Risk Disclosure

    Asset/Liability Management. Our assets and liabilities may be analyzed by
examining the extent to which our assets and liabilities are interest-rate
sensitive and by monitoring the expected effects of interest rate changes on our
net portfolio value.

    An asset or liability is interest rate sensitive within a specific time
period if it will mature or reprice within that time period.  If our assets
mature or reprice more quickly or to a greater extent than our liabilities, our
net portfolio value and net interest income would tend to increase during
periods of rising interest rates but decrease during periods of falling interest
rates.  Conversely, if our assets mature or reprice more slowly or to a lesser
extent than our liabilities, our net portfolio value and net interest income
would tend to decrease during periods of rising interest rates but increase
during periods of falling interest rates.  Our policy has been to mitigate the
interest rate risk inherent in the historical savings institution business of
originating long-term loans funded by short-term deposits by pursuing certain
strategies designed to decrease the vulnerability of our earnings to material
and prolonged changes in interest rates.

    To manage the interest rate risk of this type of loan portfolio, we are
attempting to emphasize loans with shorter terms and variable interest rates and
longer term deposits. Most of the loans in our portfolio, however, have fixed
rates. Unlike many other thrift institutions who offer both adjustable and fixed
rates on single family loans and tend to emphasize adjustable rate loans under
rising interest rate conditions, our policy is to originate all of our one- to
four-family residential loans, representing 81.4% of our total loans at December
31, 1997, with fixed rates. While we plan to emphasize the origination of home
equity and small business loans with shorter terms and variable rates, our
primary loan product will continue to be long term, fixed rate
construction/permanent loans. Our interest rate risk is, therefore, significant,
and our earnings will continue to be vulnerable to a rise in prevailing interest
rates.

                                       30
<PAGE>
 
At December 31, 1997, the average weighted term to maturity of our mortgage loan
portfolio was approximately 23 years and the average weighted term of our fixed
maturity deposits was slightly less than 2 years.

    Net Portfolio Value.  In recent years, we have measured our interest rate
sensitivity by computing the "gap" between the assets and liabilities which were
expected to mature or reprice within certain time periods, based on assumptions
regarding loan prepayment and deposit decay rates formerly provided by the OTS.
However, the OTS now measures an institution's interest rate risk by computing
the amount by which the net present value of cash flow from assets, liabilities
and off balance sheet items (the institution's net portfolio value or "NPV")
would change in the event of a range of assumed changes in market interest
rates.  These computations estimate the effect on an institution's NPV from
instantaneous and permanent 1% to 4% (100 to 400 basis points) increases and
decreases in market interest rates.  The following table presents the interest
rate sensitivity of our NPV at December 31, 1997, as calculated by the OTS,
which is based upon quarterly information that we voluntarily provided to the
OTS.

<TABLE>
<CAPTION>
 
                       Net Portfolio Value               NPV as % of Portfolio Value of Assets
   Change       ----------------------------------       -------------------------------------
  in Rates      $ Amount     $ Change     % Change          NPV Ratio     Basis Point Change
  --------      --------     --------     --------          ---------     ------------------
                                           (Dollars in thousands)
  <S>           <C>          <C>          <C>               <C>            <C>         
  + 400 bp         152        (3,519)       (96)%             (0.47)%           (943) bp
  + 300 bp         990        (2,681)       (73)               2.95             (695) bp
  + 200 bp       1,892        (1,778)       (48)               5.44             (445) bp
  + 100 bp       2,823          (848)       (23)               7.85             (205) bp
      0 bp       3,671                                         9.89                    
  - 100 bp       4,188           518         14               11.05              115  bp
  - 200 bp       4,286           616         17               11.18              129  bp
  - 300 bp       4,397           726         20               11.34              145  bp
  - 400 bp       4,657           987         27               11.83              194  bp
 
</TABLE>

     While we cannot predict future interest rates or their effects on our NPV
or net interest income, we do not expect current interest rates to have a
material adverse effect on our NPV or net interest income in the near future.
Computations of prospective effects of hypothetical interest rate changes are
based on numerous assumptions, including relative levels of market interest
rates, prepayments and deposit runoff and should not be relied upon as
indicative of actual results.  Certain shortcomings are inherent in such
computations.  Although certain assets and liabilities may have similar maturity
or periods of repricing, they may react at different times and in different
degrees to changes in the market interest rates.  The interest rates on certain
types of assets and liabilities may fluctuate in advance of changes in market
interest rates, while rates on other types of assets and liabilities may lag
behind changes in market interest rates.  Certain assets, such as variable rate
loans, generally have features which restrict changes in interest rates on a
short-term basis and over the life of the loan.  In the event of a change in
interest rates, prepayments and early withdrawal levels could deviate
significantly from those assumed in making calculations set forth above.
Additionally, an 

                                       31
<PAGE>
 
increased credit risk may result as the ability of many borrowers to service
their debt may decrease in the event of an interest rate increase.

     The board of directors reviews our asset and liability policies.  The board
of directors meets regularly to review interest rate risk and trends, as well as
liquidity and capital ratios and requirements.  Management administers the
policies and determinations of the board of directors with respect to our asset
and liability goals and strategies.  We expect that our asset and liability
policies and strategies will continue as described so long as competitive and
regulatory conditions in the financial institution industry and market interest
rates continue as they have in recent years.

                                       32
<PAGE>
 
Average Balances, Interest and Average Yields

     The following table sets forth certain information relating to our average
statement of financial condition and reflects the average yield on assets and
average cost of liabilities for the periods indicated and the average yields
earned and rates paid at the date and for the periods indicated.  Such yields
and costs are derived by dividing income or expense by the average monthly
balance of assets or liabilities, respectively, for the periods presented.
Average balances are derived from month-end balances.  We do not believe that
the use of month-end balances instead of daily balances has caused any material
difference in the information presented.

<TABLE>
<CAPTION>
 
                                                                                        Year Ended December 31,
                                                                        ---------------------------------------------------------
                                                      At December 31,               1997                         1996
                                                            1997        ---------------------------  ----------------------------
                                                      ----------------                      Average                       Average
                                                                Yield/  Average              Yield/  Average               Yield/
                                                      Balance    Cost   Balance  Interest     Cost   Balance   Interest     Cost
                                                      -------   ------  -------  --------    ------  -------   --------    ------
<S>                                                   <C>       <C>     <C>      <C>        <C>      <C>       <C>        <C>
                                                                                 (Dollars in thousands)
Interest-earning assets:
  Loans.....................................          $29,961    7.84%  $27,282   $ 2,209     8.10%  $23,157   $ 1,928      8.32%
  Investment securities available for sale..               --      --       183        15     8.19       189        15      7.94
  Mortgage-backed securities................            1,955    7.79     2,167       166     7.66     2,057       162      7.88
  Other interest-earning assets (1).........            3,740    6.15     4,003       236     5.90     6,353       352      5.54
                                                      -------           -------   -------            -------   -------
   Total interest-earning assets............           35,656    7.66    33,635     2,626     7.81    31,756     2,457      7.74
Non-interest-earning assets.................              428               433                          527
                                                      -------           -------                      -------
   Total assets.............................          $36,084           $34,068                      $32,283
                                                      =======           =======                      =======
 
Interest-bearing liabilities:
  Savings deposits..........................          $32,269    4.24   $29,854   $ 1,474     4.94   $28,796   $ 1,394      4.84
  Short-term borrowings (2).................               51    3.05       419        19     4.53        77         3      3.90
   Total interest-bearing liabilities.......           32,320    4.24    30,273     1,493     4.93    28,873     1,397      4.84
Non-interest bearing liabilities............              870               891                          702
   Total liabilities........................           33,190            31,164                       29,575
Retained earnings...........................            2,894             2,904                        2,708
   Total liabilities and retained earnings..          $36,084           $34,068                      $32,283
 
Net interest income.........................                                      $ 1,133                      $ 1,060
Net interest rate spread (3)................                                                  2.88%                         2.90%
Net interest-earning assets.................                            $ 3,362                      $ 2,883
Net interest margin (4).....................                                                  3.37%                         3.34%
Ratio of average interest-earning assets
 to average interest-bearing liabilities....                                       111.11%                     109.99 %

</TABLE>

- --------------------
(1)  Other interest-earning assets includes interest-bearing deposits and FHLB
     of Atlanta stock.
(2)  Short-term borrowings includes FHLB advances and advance payments by
     borrowers for expenses.
(3)  Net interest rate spread represents the difference between the average
     yield on interest-earning assets and the average rate on interest-bearing
     liabilities.
(4)  Net interest margin represents net interest income divided by average
     interest-earning assets.

                                       33
<PAGE>
 
Rate/Volume Analysis

     The table shows certain information regarding changes in our interest
income and interest expense of the Bank for the periods indicated.  For each
category of interest-earning asset and interest-bearing liability, information
is provided on changes attributable to: (i) changes in volume (changes in volume
multiplied by old rate); and (ii) changes in rates (change in rate multiplied by
old volume); and (iii) change in rate-volume (changes in rate multiplied by the
changes in volume).

<TABLE>
<CAPTION>
 
                                                                    Year Ended December 31,
                                              -------------------------------------------------------------------
                                                   1997      vs.     1996             1996     vs.     1995
                                              --------------------------------   --------------------------------
                                                    Increase (Decrease)               Increase (Decrease)
                                                           Due to                            Due to
                                              --------------------------------   --------------------------------
                                                                 Rate/                             Rate/
                                              Volume    Rate    Volume   Total   Volume    Rate   Volume    Total
                                              ------    ----    ------   -----   ------    ----   ------    -----
                                                                               (In thousands)
<S>                                           <C>       <C>     <C>      <C>     <C>      <C>     <C>       <C>
Interest-earning assets:
  Loans.....................................   $ 341     $(51)   $  (9)  $ 281     $127   $ (63)     $(4)    $ 60
  Investment securities available for sale..       1       --       (1)     --       --      --       --       --
  Mortgage-backed securities................       9       (4)      --       5      (15)     (2)      --      (17)
  Interest-bearing deposits.................    (129)      20       (8)   (117)      (1)     (6)      --       (5)
                                               -----     ----    -----   -----     ----   -----   ------     ----
    Total interest-earning assets...........     222      (35)     (18)    169      113     (71)      (4)      38
                                               -----     ----    -----   -----     ----   -----   ------     ----

Interest-bearing liabilities:
  Deposits..................................      49       29        1      79       49      (5)      --       44
  Short-term borrowings (1).................      17       --       --      17       (1)     --       --       (1)
                                               -----     ----    -----   -----     ----   -----   ------     ----
                                                  66       29        1      96       48      (5)      --       43
                                               -----     ----    -----   -----     ----   -----   ------     ----
 
  Increase (decrease) in net interest
    income..................................   $ 156     $(64)   $ (19)  $  73     $ 65   $ (66)     $(4)    $ (5)
                                               =====     ====    =====   =====     ====   =====   ======     ====

</TABLE>

- ---------------
(1)  Includes Federal Home Loan Bank of Atlanta advances and advance payments by
     borrowers for expenses.

                                       34
<PAGE>
 
Comparison of Financial Condition at December 31, 1997 and December 31, 1996

     Total assets increased by $3.9 million or 12.1% from $32.2 million at
December 31, 1996 to $36.1 million at December 31, 1997.  Total liabilities
increased $3.7 million or 12.5%, from $29.5 million at December 31, 1996 to
$33.2 million at December 31, 1997.  The increase in assets for the period was
primarily attributable to the growth in our loan portfolio of $6.2 million which
was the result of our capitalizing on strong loan demand in our market area.
Loan growth was funded from a net increase in deposits  of $3.5 million, a net
reduction in interest-earning deposits of $1,672,000 and net maturities and
repayments on investment and mortgage-backed securities of $575,000.

Comparison of Results of Operations for the Years Ended December 31, 1997 and
1996

     Net Income.  Our net income declined $4,000, from $149,000 for the fiscal
year ended December 31, 1996 to $145,000 for the fiscal year ended December 31,
1997.  The primary reasons for the decline were an increase of $113,000 in the
provision for losses on loans, a $32,000 loss on the sale of securities during
1997 and an increase in compensation and related expenses of $141,000. These
were offset by a $235,000 decrease in deposit insurance expense due to a special
assessment that all thrift institutions were required to pay in order to
recapitalize the SAIF, the FDIC fund that insures our deposits.  The special
assessment amounted to $182,000 which was paid during the quarter ended December
31, 1996.   The most significant component in the increase in compensation
during 1997 was a $115,000 charge associated with adoption of our Deferred
Compensation Plan for Directors.  See "Management of Northfield Federal Savings
- -- Director Compensation."

     Net Interest Income.  Our net interest income, which is the difference
between our interest income and our interest expense, increased from $1.06
million for fiscal year 1996 to $1.13 million for fiscal year 1997. The $73,000
increase was due to an increase in the level of interest income we received on
our loan and securities portfolio.  Although the average yield on these
portfolios actually declined, the average balance of these assets rose which
accounted for the income growth.  Total interest expense also increased during
the fiscal year $97,000 due to an increase in both the volume and the average
cost of our deposits and other borrowings, our two main categories of interest-
bearing liabilities.

     Provision for Loan Losses.  Financial institutions are required to
establish an allowance for loan losses.  The balance of such allowance depends
on the risk in the institution's loan portfolio, its level of problem loans and
general economic conditions, among other factors.  Loans which cannot be
collected are charged against the allowance and thereby reduce its balance.  An
institution adds to the allowance by making a provision for loan losses which is
an expense item.  During fiscal year 1997, we made a provision for loan losses
of $123,000 as compared to a $10,000 provision during the previous fiscal year.
The greater provision was based on the level of nonperforming loans at December
31, 1997.

                                       35
<PAGE>
 
     Noninterest Income.  Noninterest income (e.g., gains or losses on the sale
of securities, loan and deposit account fees) was a negative $2,000 for fiscal
1997 due primarily to the $32,000 loss on the sale of available for sale
securities.

     Noninterest Expense.  Our noninterest expenses consist mainly of salaries
and employee benefits, rent on our offices, federal deposit insurance premiums,
data processing fees, the expenses associated with our fixtures and equipment
and advertising.  For fiscal year 1997, total noninterest expenses were $772,000
as compared to $843,000 for fiscal year 1996.  The decline in this expense level
was due mainly to the special SAIF assessment of $182,000 in 1996, offset by a
$141,000 increase in compensation expense primarily due to adoption of our
deferred compensation plan for directors, which amounted to a charge of
$115,000.

     Our noninterest expense will increase following the conversion due to
several factors.  First, we will incur significant expenses relating to our new
office building and branch office.  Our compensation expense will increase due
to added personnel to staff our new branch and to develop our small business
lending program.  We will also see added expense associated with the ESOP and,
later on, the MRP.  Further, we will experience the costs of being a public
company.

     Our deposit insurance premium expense has been reduced as the rate we have
to pay for such insurance was significantly reduced effective January 1, 1997.

     Income Tax Expense.  Our income tax expense for fiscal year 1997 was
slightly higher for fiscal 1997 as compared to fiscal 1996, rising $1,600.

Liquidity and Capital Resources

    We are required to maintain minimum levels of liquid assets as defined by
OTS regulations. This requirement, which varies from time to time (currently 4%)
depending upon economic conditions and deposit flows, is based upon a percentage
of our deposits and short-term borrowings. The required ratio at December 31,
1997 was 4% and our liquidity ratio for the month ended December 31, 1997 was
8.9%.  It is our belief that upon completion of the conversion our liquidity
ratio will increase due to the additional funds we will receive.

    Our primary sources of funds are deposits, repayment of loans and mortgage-
backed securities, maturities of investments and interest-bearing deposits,
funds provided from operations and advances from the FHLB of Atlanta.  While
scheduled repayments of loans and mortgage-backed securities and maturities of
investment securities are predictable sources of funds, deposit flows and loan
prepayments are greatly influenced by the general level of interest rates,
economic conditions and competition.  We use our liquidity resources principally
to fund existing and future loan commitments, to fund maturing certificates of
deposit and demand deposit withdrawals, to invest in other interest-earning
assets, to maintain liquidity, and to meet operating expenses.

                                       36
<PAGE>
 
    Liquidity may be adversely affected by unexpected deposit outflows, higher
interest rates paid by competitors, adverse publicity relating to the savings
and loan industry, and similar matters. Management monitors projected liquidity
needs and determines the level desirable, based in part on our commitments to
make loans and management's assessment of our ability to generate funds.

    We are subject to federal regulations that impose certain minimum capital
requirements.  For a discussion on such capital levels, see "Historical and Pro
Forma Capital Compliance" and "Regulation -- Regulation of the Bank --
Regulatory Capital Requirements."

Impact of Inflation and Changing Prices

    Our financial statements and the accompanying notes presented elsewhere in
this document, have been prepared in accordance with generally accepted
accounting principles, which require the measurement of financial position and
operating results in terms of historical dollars without considering the change
in the relative purchasing power of money over time and due to inflation. The
impact of inflation is reflected in the increased cost of our operations.  As a
result, interest rates have a greater impact on our performance than do the
effects of general levels of inflation.  Interest rates do not necessarily move
in the same direction or to the same extent as the prices of goods and services.

Recent Pronouncements

    FASB Statement on Accounting for Stock-Based Compensation.  In October 1995,
the FASB issued SFAS No. 123.  SFAS No. 123 defines a "fair value based method"
of accounting for an employee stock option whereby compensation cost is measured
at the grant date based on the value of the award and is recognized over the
service period.  FASB has encouraged all entities to adopt the fair value based
method, however, it will allow entities to continue the use of the "intrinsic
value based method" prescribed by Accounting Principles Board ("APB") Opinion
No. 25.  Under the intrinsic value based method, compensation cost is the excess
of the market price of the stock at the grant date over the amount an employee
must pay to acquire the stock.  However, most stock option plans have no
intrinsic value at the grant date and, as such, no compensation cost is
recognized under APB Opinion No. 25.  Entities electing to continue use of the
accounting treatment of APB Opinion No. 25 must make certain pro forma
disclosures as if the fair value based method had been applied. The accounting
requirements of SFAS No. 123 are effective for transactions entered into in
fiscal years beginning after December 15, 1995.  Pro forma disclosures must
include the effects of all awards granted in fiscal years beginnings after
December 15, 1994.  If the proposed Option Plan is adopted we will use the
intrinsic value method.  Accordingly, there will be no impact as a result of our
adoption of SFAS No.  123.

                                       37
<PAGE>
 
     FASB Statement on Accounting for Transfers and Servicing of Financial
Assets and Extinguishments of Liabilities.  In June 1996, FASB issued SFAS No.
125, which will be effective, on a prospective basis, for transfers and
servicing of financial assets and extinguishment of liabilities occurring after
December 31, 1996.  SFAS No. 125 supersedes SFAS No. 122, Accounting for
Mortgage Servicing Rights.  SFAS No. 125 provides accounting and reporting
standards for transfers and servicing of financial assets and extinguishment of
liabilities based on consistent application of a financial-components approach
that focuses on control.  SFAS No. 125 extends the "available for sale" and
"trading" approach of SFAS No. 115 to non-security financial assets that can be
contractually prepaid or otherwise settled in such a way that the holder of the
asset would not recover substantially all of its recorded investment.  In
addition, SFAS No. 125 amends SFAS No. 115 to prevent a security from being
classified as held to maturity if the security can be prepaid or settled in such
a manner that the holder of the security would not recover substantially all of
its recorded investment.  The extension of the SFAS No. 115 approach to certain
non-security financial assets and the amendment to SFAS No. 115 are effective
for financial assets held on or acquired after January 1, 1997.  The FASB has
proposed to defer the effective date of SFAS No. 125 until January 1, 1998 for
certain transactions including repurchase agreements, dollar-roll, securities
lending and similar transactions.  We adopted SFAS No. 125 on January 1, 1997.
There was no impact on our financial statements of such adoption.

     FASB Statement on Earnings Per Share.  In February 1997, the FASB issued
SFAS No. 128, "Earnings Per Share."  SFAS 128 supersedes APB Opinion No. 15,
"Earnings Per Share" and specifies the computation, presentation and disclosure
requirements for earnings per share for entities with publicly held common stock
or potential common stock.  SFAS No. 128 replaces the presentation of primary
earnings per share with a presentation of basic earnings per share and fully
diluted earnings per share with diluted earnings per share.  It also requires
dual presentation of basic and diluted earnings per share on the face of the
income statement for all entities with complex capital structures and requires
the reconciliation of the numerator and denominator of the basic earnings per
share computation to the numerator and denominator of the diluted earnings per
share computation.  This statement is effective for financial statements issued
for periods ending after December 15, 1997, including interim periods.  We will
adopt SFAS No. 128 in the initial period after conversion.  We do not believe
the impact of adopting SFAS No. 128 will be material to our financial
statements.

     FASB Statement on Disclosure of Information about Capital Structure.  In
February 1997, the FASB issued SFAS No. 129.  The Statement incorporates the
disclosure requirements of APB Opinion No. 15, "Earnings per Share," and makes
them applicable to all public and nonpublic entities that have issued securities
addressed by the Statement.  APB Opinion No. 15 requires disclosure of
descriptive information about securities that is not necessarily related to the
computation of earnings per share.  The statement continues the previous
requirements to disclose certain information about an entity's capital structure
found in APB Opinion No. 10, Omnibus Opinion - 1966 and No. 15, Earnings Per
Share and FASB Statement No. 47, Disclosure of Long-

                                       38
<PAGE>
 
Term Obligations, for entities that were subject to the requirements of those
standards. This Statement eliminates the exemption of nonpublic entities from
certain disclosure requirements of Opinion 15 as provided by Statement No. 21,
Suspension of the Reporting of Earnings per Share and Segment Information for
Nonpublic Enterprises. It supersedes specific disclosure requirements of Opinion
10 and 15 and Statement 47 and consolidates them in this Statement for ease of
retrieval and for greater visibility to nonpublic entities. This Statement is
effective for financial statements for periods ending after December 15, 1997.
SFAS No. 129 will be adopted by us in the initial period after December 15,
1997. We do not believe the impact of adopting SFAS No. 129 will be material to
our financial statements.

     FASB Statement on Reporting Comprehensive Income.  In June 1997, the FASB
issued SFAS No.  130, "Reporting Comprehensive Income," which requires entities
presenting a complete set of financial statements to include details of
comprehensive income that arise in the reporting period.  Comprehensive income
consists of net income or loss for the current period and other comprehensive
income,  expense, gains and losses that bypass the income statement and are
reported in a separate component of equity, i.e., unrealized gains and losses on
certain investment securities. SFAS No.  130 is effective for fiscal years
beginning after December 15, 1997.  We do not believe that adoption of SFAS No.
130 will have a material adverse effect on our financial position or results of
operations.

     FASB Statement on Disclosures Regarding Segments.  In June 1997, the FASB
issued SFAS No. 131, "Disclosures about Segments of an Enterprise and Related
Information."  Statement 131 establishes standards for the way public
enterprises are to report information about operating segments in annual
financial statements and requires those enterprises to report selected
information about operating segments in interim financial reports issued to
stockholders.  It also establishes standards for related disclosures about
products and services, geographic areas and major customers. Statement 131
supersedes FASB Statement No. 14, "Financial Reporting for Segments of a
Business Enterprise" but retains the requirement to report information about
major customers.  It amends Statement No. 94, "Consolidation of all Majority-
Owned Subsidiaries" to remove the special disclosure requirements for previously
unconsolidated subsidiaries.  Statement 131 is effective for financial
statements for periods beginning after December 15, 1997.  We do not believe the
impact of adopting SFAS No. 131 will be material to our financial statements.

     FASB Statement on Employers Disclosures About Pensions and Other
Postretirement Benefits.  In February 1998, the FASB issued SFAS No. 132,
"Employers Disclosures About Pension and Other Postretirement Benefits," which
standardizes disclosure requirements for pensions and postretirement benefits.
This Statement is effective for fiscal years beginning after December 15, 1997.
We do not believe that the adoption of SFAS No. 132 will have a material effect
on our financial statements.

                                       39
<PAGE>
 
                      BUSINESS OF NORTHFIELD BANCORP, INC.

     The Company is not an operating company and has not engaged in any
significant business to date. It was formed on March 5, 1998 as a Maryland-
chartered corporation to be the holding company for Northfield Federal Savings
Bank. The holding company structure and retention of proceeds will facilitate:
(i) diversification into non-banking activities, (ii) acquisitions of other
financial institutions, such as savings institutions, (iii) expansion within
existing and into new market areas and (iv) stock repurchases without adverse
tax consequences. There are no present plans regarding diversification,
acquisitions of other companies or stock repurchases.

     Northfield Federal Savings has operated as an independent community
oriented savings institution since 1923. It is our intention to continue to
operate as an independent community oriented savings association following the
conversion.

     Since the Company will own only one savings association, it generally will
not be restricted in the types of business activities in which it may engage,
provided that we retain a specified percentage of our assets in housing-related
investments. The Company initially will not conduct any active business and does
not intend to employ any persons other than officers but will utilize our
support staff from time to time.

                     BUSINESS OF NORTHFIELD FEDERAL SAVINGS

     The principal sources of funds for our activities are deposits and payments
on loans. Our deposits totaled $32.6 million at December 31, 1997. Funds are
used principally for the origination of construction and permanent loans secured
on one- to four-family residences which are located in our market area. We also
originate other types of loans, including loans secured by multi-family
residential property, commercial real estate, home equity and savings account
loans. We also purchase commercial leases from a local leasing company, as well
as investment and mortgage-backed securities. Our principal source of revenue is
interest received on loans and investments and our principal expense is interest
paid on deposits.

Market Area

     We consider our primary market area to be Baltimore, Harford and Cecil
County, Maryland. The economy of our market area has historically been based on
industry such as steel, shipyards and automobile assembly.

     The principal sources of employment in Baltimore, Harford and Cecil 
Counties are the services, retail trade and manufacturing industries. The 1996 
median household income is estimated to be $40,481 for Baltimore County, $50,300
for Harford County and $43,000 for Cecil County. In the period from 1990 to 
1996, Baltimore County's population increased 4.28% compared to the State of 
Maryland at 6.40% and the United States at 6.67%. During the same period, the 
populations of Harford and Cecil County grew 12.8% and 8.5%, respectively. Based
on projected increases in population and households in these market areas over 
the next several years, we believe that the Bank's market areas can support 
future lending growth, though there can be no assurance in this regard.

Lending Activities

     Most of our loans are construction/permanent loans on one- to four-family
residences.  We also make multi-family real estate mortgage loans as well as
commercial real estate, home equity and savings account loans.  We also purchase
commercial leases from a local leasing company.



                                      40
<PAGE>
 
     The following table sets forth information concerning the types of loans
held by us at the dates indicated.

<TABLE> 
<CAPTION>         
                                                   At December 31,
                                      ------------------------------------------
                                            1997                    1996
                                      ------------------      ------------------
                                      Amount          %       Amount          %
                                      ------         ---      ------         ---
                                                  (Dollars in thousands)
<S>                                   <C>         <C>         <C>         <C>  
Real estate loans:
  One- to four-family residential 
   mortgage loans..................   $ 25,740     81.35%     $ 19,439    77.18%
  Construction loans...............      2,105      6.65         2,462     9.78 
  Commercial real estate loans.....      2,805      8.87         2,195     8.71 
  Commercial loans collateralized                                               
   by lease finance receivables....        741      2.34         1,018     4.04 
                                                                                
Consumer loans:                                                                 
  Home equity lines of credit......        177       .56            --       -- 
  Loans secured by deposits........         74       .23            74      .29 
                                        ------    ------        ------   ------ 
        Total loans................     31,642    100.00%       25,188   100.00%
                                                  ======                 ======
 
Less:
  Undisbursed portion of loans 
   in process......................      1,197                   1,028
  Deferred loan
   origination fees................        268                     219
  Allowance for losses.............        216                     100
                                      --------                --------
       Loan portfolio, net.........   $ 29,961                $ 23,841
                                      ========                ========
</TABLE> 

                                      41
<PAGE>
 
     The following table sets forth the estimated maturity of our loan portfolio
at December 31, 1997.  The table does not include the effects of possible
prepayments or scheduled repayments.  All mortgage loans are shown as maturing
based on the date of the last payment required by the loan agreement.

<TABLE>
<CAPTION>
                                                                                      Due After              Due After        
                                               Due During the Year Ending             3 Through              5 Through        
                                                       December 31,                  5 Years After         10 Years After    
                                            1998         1999          2000        December 31, 1997      December 31, 1997 
                                          -------       -------       -------      -----------------      -----------------
                                                                            (In Thousands)
<S>                                       <C>           <C>           <C>          <C>                    <C> 
Real estate loans:                                                                                      
  One- to four-family...............      $   371       $     4       $    48          $   377                 $ 1,165  
  Construction......................        1,038         1,067            --               --                      --  
  Commercial real estate............          137             2            --              314                     852  
Commercial loans collateralized                                                                              
   by lease finance receivables.....          120           154           372               95                      --  
Consumer loans:                                                                                         
  Home equity lines of credit.......          177            --            --               --                      --  
  Loans secured by deposits.........           74            --            --               --                      --  
                                          -------       -------       -------          -------                 -------  
     Total..........................      $ 1,917       $ 1,227       $   420          $   786                 $ 2,017  
                                          =======       =======       =======          =======                 =======  

<CAPTION> 

                                             Due After
                                            10 Through           Due After 15
                                          15 Years After          Years After
                                         December 31, 1997      December 31, 1997        Total
                                         -----------------      -----------------       --------
<S>                                      <C>                    <C>                     <C> 
Real estate loans:                                                                               
  One- to four-family...............        $  2,909                $ 20,866            $ 25,740
  Construction......................              --                      --               2,105
  Commercial real estate............           1,010                     490               2,805
Commercial loans collateralized                                                     
   by lease finance receivables.....              --                      --                 741 
Consumer loans:                                                                     
  Home equity lines of credit.......              --                      --                 177 
  Loans secured by deposits.........              --                      --                  74 
                                            --------                --------            --------
     Total..........................        $  3,919                $ 21,356            $ 31,642
                                            ========                ========            ========
</TABLE>

     The next table sets forth at December 31, 1997, the dollar amount of all
loans due one year or more after December 31, 1997 which have predetermined
interest rates and have floating or adjustable interest rates.

<TABLE> 
<CAPTION>  
                                        Predetermined      Floating or
                                            Rate         Adjustable Rates
                                        -------------    ----------------
<S>                                     <C>              <C> 
                                                  (In thousands)
Real estate loans:
  One- to four-family...............      $  25,369         $      --
  Construction......................          1,067                --
  Commercial real estate............          2,668                --
Commercial loans collateralized by
  lease finance receivables.........            621                --
Consumer loans:
  Home equity lines of credit.......             --                --
  Loans secured by deposits.........             --                --
                                          ---------         ---------
      Total.........................      $  29,725         $      --
                                          =========         =========
</TABLE> 

                                      42
<PAGE>
 
     Residential Construction Loans.  Our most significant loan product is
lending to finance the construction of one- to four-family residential property
to the individuals who will be the owners and occupants upon completion of
construction.  Construction/permanent loans account for a majority of our single
family loan originations.  We have historically emphasized these loans and have
established a reputation in our market areas for this type of lending.  We
believe that we can continue to respond to the demand for these loans by
borrowers engaged in building and development of single family residential
properties in the growing communities of our market areas.  Virtually all of
these loans are structured to be converted to permanent loans at the end of the
construction phase. Borrowers are required to pay interest during the
construction period.  Loan proceeds are disbursed according to a draw schedule
and we inspect the progress of the construction before additional funds are
disbursed.  The interest rate we charge is fixed during the construction phase
(based on the prime rate) and fixed thereafter, and these loans generally have
30 year terms.

     While we believe we have substantial experience in construction lending,
this type of lending involves a higher degree of credit risk than long term
financing of residential properties.  Our risk of loss on a construction loan is
dependent largely upon the accuracy of the initial estimate of the property's
value at completion of construction and the estimated cost of construction.  If
the estimate of construction cost and the marketability of the property upon
completion of the project prove to be inaccurate, we may be compelled to advance
additional funds to complete the construction. Furthermore, if the final value
of the completed property is less than the estimated amount, the value of the
property might not be sufficient to assure the repayment of the loan.

     Our underwriting criteria are designed to evaluate and minimize the risks
of each construction loan.  Among other things, we consider the amount of the
borrower's equity in the project, independent valuations and reviews of cost
estimates and pre-construction sale, the builder's financial report and the
reputation of the borrower.  In addition, we review the builder's financial
reports and other information.  We have longstanding relationships with several
builders in our area and do most of our construction lending with them.

     One- to Four-Family Residential Loans.  We also originate standard one- to
four-family residential mortgage loans secured by property located in our
primary market area.  These are made in amounts up to 80% of the lesser of the
appraised value or purchase price, with private mortgage insurance or additional
collateral required on loans with a loan to-value ratio in excess of 80%.
Although, all of our one- to four-family loans are underwritten to conform with
secondary market standards, we originate such loans with the intention that they
will be held in our portfolio rather than sold in the secondary mortgage market.

     Mortgage loans originated and held by us generally include due-on-sale
clauses.  This gives us the right to deem the loan immediately due and payable
in the event the borrower transfers ownership of the property securing the
mortgage loan without our consent.


                                      43
<PAGE>
 
     Commercial Real Estate Loans.  Our commercial real estate loans are secured
primarily by office buildings and multi-family residential investment
properties.  Some of our commercial real estate loans are participations with
other financial institutions in our market area.  Commercial real estate loans
are made in amounts of up to 75% of the appraised value of the property.  Our
commercial real estate loans generally have variable rates with terms of five
years and amortization schedules of up to 30 years.  At December 31, 1997, the
largest of our commercial real estate loans was an $886,000 loan participation,
of which our interest totaled $333,000.  This loan was secured by an office
building.

     Commercial real estate lending, which accounted for approximately 8.9% of
our loan portfolio at December 31, 1997, entails significant additional risks
compared to single-family residential property lending.  These loans typically
involve large loan balances to single borrowers or groups of related borrowers.
The repayment of these loans typically is dependent on the successful operation
of the real estate project securing the loan.  These risks can be significantly
affected by supply and demand conditions in the market for office and retail
space and may also be subject to adverse conditions in the economy.  To minimize
these risks, we generally limit this type of lending to our market area and to
borrowers who are otherwise well known to us.

     Commercial Leases.  For over ten years, we have purchased commercial
finance leases from a local leasing company.  These leases are primarily on
office equipment.  We purchase the lease but all servicing is conducted by the
seller.  The average length of the individual leases ranges from 3.5 to four
years and the average size ranges from $1,500 to $5,000.   At December 31, 1997,
our portfolio of commercial leases totaled $741,000 or 2.3% of total loans.  In
recent years, we have come under regulatory criticism based on violation of the
OTS's loans to one borrower regulation. We are in the process of bringing the
program into compliance with the loans to one borrower regulation.   Our
portfolio includes both recourse and non-recourse purchases, but in accordance
with OTS  comments, we are currently purchasing on a recourse basis only.
Following the conversion, we will be back into compliance with the loans to one
borrower regulation.

     Commercial leases are subject to the same risk of default as direct
commercial loans. Although these loans provide for higher interest rates and
shorter terms than permanent single family residential real estate loans, they
involve more credit risk because of the type and nature of the collateral.
Commercial business loans are typically  made on the basis of the borrower's
ability to make repayment from the cash flow of the borrower's business, and
repayment is therefore substantially dependent on the success of the business
itself.

     Since the program began, we have experienced losses of $7,700 in connection
with these leases, all involving non-recourse purchases.  Currently, we are not
purchasing these leases. Following the conversion, we expect to increase the
level of these leases to the amount allowed by the loans to one borrower
regulation, which we estimate will be approximately $1.0 million after receipt
of the conversion proceeds.


                                      44
<PAGE>
 
     Consumer Loans.  Our consumer loans consist of home equity lines of credit
and savings account loans.  We began offering home equity lines of credit in
December 1996.  These loans are secured by a real estate mortgage with our
security interest in the borrower's primary residence. These are variable rate
loans indexed to the prime rate with terms of 20 years.  Our savings account
loans are made for up to 90% of the balance on deposit in savings accounts or
certificates of deposit. These loans are secured by an interest in the
borrower's account.

     Small Business Lending. In the summer of 1998, we plan to initiate a small
business loan program in which we originate loans with Small Business
Administration ("SBA") guarantees. SBA generally guarantees between 80% and 90%
of the loan balance. However, the SBA imposes some limitations on the interest
rate and loan origination fees charged. We currently expect that our commercial
business lending activities will encompass loans with a variety of purposes and
forms of security, including loans to finance accounts receivable, inventory and
equipment. We intend to market these loans to small local sole proprietorships
and other small businesses. The interest rates we charge on these loans are
variable.

     Unlike residential mortgage loans, which generally are made on the basis of
the borrower's ability to make repayment from his or her employment and other
income and which are secured by real property whose value tends to be more
easily ascertainable, commercial business loans are of higher risk and typically
are made on the basis of the borrower's ability to make repayment from the cash
flow of the borrower's business. As a result, the availability of funds for the
repayment of commercial business loans may be substantially dependent on the
success of the business itself. Further, the collateral securing the loans may
depreciate over time, may be difficult to appraise and may fluctuate in value
based on the success of the business. We feel that these risks are mitigated in
the case of our commercial business lending activities since our commercial
business loan program will involve loans with SBA guarantees.

     Loan Approval Authority and Underwriting. Our President may approve all
commercial leases that we purchase up to $25,000 and all home equity lines of
credit up to that amount. All other loans are approved by our board of
directors.

     Upon receipt of a completed loan application from a prospective borrower, a
credit report is ordered. Income and certain other information is verified. If
necessary, additional financial information may be requested. An appraisal or
other estimate of value of the real estate intended to be used as security for
the proposed loan is obtained. Appraisals are prepared by outside fee appraisers
who are approved by the board of directors.

     Either title insurance or a title opinion is generally required on all real
estate loans. Borrowers also must obtain fire and casualty insurance. Flood
insurance is also required on loans secured by property which is located in a
flood zone.


                                      45
<PAGE>
 
     Loan Originations, Purchases and Sales. The following table sets forth
certain information with respect to our loan originations. We did not purchase
or sell any loans during the periods.

 
                                                        Year Ended December 31,
                                                       -------------------------
                                                           1997         1996
                                                       ------------  -----------
                                                           (In thousands)
 
Net loans, beginning of period......................      $23,841      $21,695
 
Origination by type:
- -------------------
Real estate loans:
   One- to four-family..............................      $ 9,621      $ 6,366
   Commercial real estate...........................          439          142
 
Consumer loans:
   Loans secured by deposits........................           50            8
   Home equity lines of credit......................          505           --
                                                          -------      -------
          Total loans originated....................       10,615        6,516
 
Purchases:
- ---------
   Loan participations..............................          350           --
   Commercial loans collateralized by lease finance
      receivables...................................          340          207
                                                          -------      -------
 
Repayments..........................................       (4,843)      (4,329)
 
Decrease (increase) in other items, net.............         (342)        (248)
                                                          -------      -------
 
      Net increase in loans receivable, net.........        6,120        2,146
                                                          -------      -------
 
Net loans, end of period............................      $29,961      $23,841
                                                          =======      =======
 

     All of the loans we originate are intended to be held in our portfolio
rather than sold in the secondary mortgage market. Our one- to four-family
residential loans do, however, conform to secondary market guidelines. We may,
therefore, decide to sell loans in the secondary market in the future. We
occasionally purchase loan participations from other financial institutions.
These participation interest purchases are reflected in the above table.
Generally, the purchase of participation interests involves the same risks as
would the origination of the same types of loans as well as the additional risk
that results from the fact that we have less control over the origination and
subsequent administration of such loans.

     Loan Commitments.  Written commitments are given to prospective borrowers
on all approved real estate loans.  Generally, the commitment requires
acceptance within 30 days of the date of issuance.  At December 31, 1997,
commitments to cover originations of mortgage loans were $395,000.  We believe
that virtually all of our commitments will be funded.


                                      46
<PAGE>
 
     Loans to One Borrower. The maximum amount of loans which we may make to any
one borrower may not exceed the greater of $500,000 or 15% of our unimpaired
capital and unimpaired surplus. We may lend an additional 10% of our unimpaired
capital and unimpaired surplus if the loan is fully secured by readily
marketable collateral. Our loan-to-one borrower limit was approximately $500,000
at December 31, 1997. At December 31, 1997, our largest loan outstanding had a
balance of $500,000.

Nonperforming and Problem Assets

     Loan Delinquencies. Generally when a mortgage loan becomes 30 days past
due, a notice of nonpayment is sent to the borrower. Additional notices and
letters from us are sent if the loan remains delinquent after 45, 60 and 75
days. If the loan continues in a delinquent status for 90 days past due and no
repayment plan is in effect, a notice of right to cure default is sent to the
borrower giving 30 additional days to bring the loan current before foreclosure
is commenced. Our board meets regularly to determine when foreclosure
proceedings should be initiated. The customer will be notified when foreclosure
is commenced. At December 31, 1997, our loans past due between 30 and 89 days
totaled $110,000.

     Loans are reviewed on a monthly basis and are generally placed on a non-
accrual status when the loan becomes more than 90 days' delinquent or when, in
our opinion, the collection of additional interest is doubtful. Interest accrued
and unpaid at the time a loan is placed on nonaccrual status is charged against
interest income. Subsequent interest payments, if any, are either applied to the
outstanding principal balance or recorded as interest income, depending on the
assessment of the ultimate collectibility of the loan.


                                      47
<PAGE>
 
     Nonperforming Assets. The following table sets forth information regarding
our nonperforming loans. As of the dates indicated, we had no loans categorized
as troubled debt restructurings within the meaning of SFAS 15 and no real estate
owned.

<TABLE> 
<CAPTION>  
                                                               At December 31,
                                                             -------------------
                                                              1997         1996
                                                             ------       ------
                                                               (In thousands)
<S>                                                          <C>          <C>  
Loans accounted for on a non-accrual basis: (1)
  Real estate loans:
    One- to four-family....................................  $  --        $  --
    Commercial real estate.................................    135          270
                                                             -----        -----
       Total real estate loans.............................    135          270
   Commercial loans collateralized by lease finance
    receivables............................................     --           --
   Consumer loans:
    Loans secured by deposits..............................     --           --
    Home equity lines of credit...........................      --           --
    Automobile.............................................     --           --
    Other consumer.........................................     --           --
                                                             -----        -----
       Total...............................................    135          270
                                                             -----        -----
 
Accruing loans delinquent 90 days or more:
  Real estate:
    One- to four-family....................................  $  --        $  --
    Commercial real estate.................................    279   (2)     --
Commercial loans collateralized by lease finance
 receivables...............................................     --           --
Consumer loans.............................................     --           --
    Loan secured by deposits...............................     --           --
    Home improvement.......................................     --           --
    Automobile.............................................     --           --
    Other consumer.........................................     --           --
                                                             -----        -----
       Total...............................................    279   (2)     --
                                                             -----        -----
          Total nonperforming loans........................    414          270
                                                             =====        =====
 
Total non-performing loans as a percentage of total net
 loans.....................................................   1.31%        1.07%
                                                             =====        =====
Total non-performing assets as a percentage of total 
 assets....................................................   1.15%         .84%
                                                             =====        =====
</TABLE> 

- ------------------
(1)  In January 1998, these loans were fully repaid.
(2)  This balance represents a loan participation on which the borrower
     experienced cash flow difficulties on the collateral, several commercial
     properties, and became 180 days delinquent.  In February 1998, the borrower
     resumed regular payments on the loan but the loan, has not yet been brought
     current.


     During the year ended December 31, 1997, we would have recorded additional
interest income of approximately $5,772 on nonaccrual loans if such loans had
been current throughout the period.  We included income of $9,442 on such
nonaccrual loans during the year.  We had no loans which were not classified as
nonaccrual, 90 days past due or restructured, but where known information causes
us to have serious concerns as to the ability of these borrowers to comply with
their current loan terms.


                                      48
<PAGE>
 
     Classified Assets. OTS regulations provide for a classification system for
problem assets of savings associations which covers all problem assets. Under
this classification system, problem assets of savings associations such as ours
are classified as "substandard," "doubtful," or "loss." An asset is considered
substandard if it is inadequately protected by the current net worth and paying
capacity of the borrower or of the collateral pledged, if any. Substandard
assets include those characterized by the "distinct possibility" that the
savings association will sustain "some loss" if the deficiencies are not
corrected. Assets classified as doubtful have all of the weaknesses inherent in
those classified substandard, with the added characteristic that the weaknesses
present make "collection or liquidation in full, on the basis of currently
existing facts, conditions, and, values, "highly questionable and improbable."
Assets classified as loss are those considered "uncollectible" and of such
little value that their continuance as assets without the establishment of a
specific loss reserve is not warranted. Assets may be designated "special
mention" because of potential weakness that do not currently warrant
classification in one of the aforementioned categories.

     When a savings association classifies problem assets as either substandard
or doubtful, it may establish general allowances for loan losses in an amount
deemed prudent by management. General allowances represent loss allowances which
have been established to recognize the inherent risk associated with lending
activities, but which, unlike specific allowances, have not been allocated to
particular problem assets. When a savings association classifies problem assets
as loss, it is required either to establish a specific allowance for losses
equal to 100% of that portion of the asset so classified or to charge off such
amount. A savings association's determination as to the classification of its
assets and the amount of its valuation allowances is subject to review by the
OTS, which may order the establishment of additional general or specific loss
allowances. A portion of general loss allowances established to cover possible
losses related to assets classified as substandard or doubtful may be included
in determining a savings association's regulatory capital. Specific valuation
allowances for loan losses generally do not qualify as regulatory capital.

     At December 31, 1997, $339,000 of our assets were classified as special
mention, none were classified as doubtful, $135,000 of our assets were
classified as substandard and none were classified as loss. At December 31,
1997, a $83,000 specific reserve had been established for the amounts classified
as loss.

     Foreclosed Real Estate. Real estate acquired by us as a result of
foreclosure is recorded as "real estate owned" until such time as it is sold.
When real estate owned is acquired, it is recorded at the lower of the unpaid
principal balance of the related loan or its fair value less estimated disposal
costs. Any write down of real estate owned is charged to operations. At December
31, 1997, we did not have any real estate owned.

     Allowance for Loan Losses. Our policy is to provide for losses on
unidentified loans in our loan portfolio. A provision for loan losses is charged
to operations based on management's evaluation of the losses that may be
incurred in our loan portfolio. The evaluation, including a review of all loans
on which full collectibility of interest and principal may not be reasonably


                                      49
<PAGE>
 
assured, considers: (i) our past loan loss experience, (ii) known and inherent
risks in our portfolio, (iii) adverse situations that may affect the borrower's
ability to repay, (iv) the estimated value of any underlying collateral, and (v)
current economic conditions.

     We monitor our allowance for loan losses and make additions to the
allowance as economic conditions dictate.  Although we maintain our allowance
for loan losses at a level that we consider adequate for the inherent risk of
loss in our loan portfolio, actual losses could exceed the balance of the
allowance for loan losses and additional provisions for loan losses could be
required.  In addition, our determination as to the amount of its allowance for
loan losses is subject to review by the OTS, as part of its examination process.
After a review of the information available, the OTS might require the
establishment of an additional allowance.

     The following table sets forth an analysis of our allowance for loan losses
for the periods indicated.

<TABLE> 
<CAPTION> 
                                                      Year Ended December 31,
                                                     -------------------------
                                                       1997             1996
                                                     --------         --------
                                                      (Dollars in thousands)

<S>                                                  <C>              <C> 
Balance at beginning of period.............          $    100         $     90
 
Charge-offs
- -----------
Real estate loans:
 One- to four-family.......................                --               --
 Commercial real estate....................                --               --
                                                     --------         --------
   Total real estate loans.................                --               --
 
 Commercial loans collateralized by lease
    finance receivables....................                (7)              --
                                                     --------         --------
                                                           (7)              --
                                                     --------         --------
 
Consumer loans:
  Loan secured by deposits.................                --               --
  Home equity lines of credit..............                --               --
  Automobile...............................                --               --
  Other consumer...........................                --               --
                                                     --------         --------
 
Recoveries.................................                --               --
                                                     --------         --------
 
Net recoveries (charge-offs)...............                (7)              --
                                                     --------         --------
Additions charged to operations............               123               10
                                                     --------         --------
Balance at end of period...................          $    216         $    100
                                                     ========         ========
 
Allowance for loan losses to total
 non-performing loans at end of period.....             52.17%           37.04%
                                                     ========         ========
 
Allowance for loan losses to net loans
 at end of period..........................               .72%             .42%
                                                     ========         ========
Net loans charge-offs......................                (7)              --
                                                     --------         --------
Provision for loan losses..................               123               10
                                                     --------         --------
Ratio of net charge-offs to average
 loans outstanding during the period.......               .03%              --
                                                     ========         ========
</TABLE> 

                                       50
<PAGE>
 
     The following table illustrates the allocation of the allowance for loan
losses for each category of loan.  The allocation of the allowance to each
category is not necessarily indicative of future loss in any particular category
and does not restrict our use of the allowance to absorb losses in other loan
categories.

<TABLE> 
<CAPTION> 
                                                    December 31,
                                     -------------------------------------------
                                             1997                  1996
                                     ---------------------  --------------------
                                                 Percent               Percent
                                                 of Loans              of Loans
                                               in Category           in Category
                                                 to Total              to Total
                                     Amount        Loans    Amount       Loans
                                     ------    -----------  ------   -----------
                                               (Dollars in thousands)
<S>                                  <C>       <C>          <C>      <C>   
Real estate loans:
  One- to four-family..............   $  96        81.35%    $ 45        77.18%
  Construction.....................      --         6.65       --         9.78
  Commercial real estate loans.....      60         8.87       --         8.71
  Commercial loan collateralized
     by lease finance receivables..      60         2.34       55         4.04
  Consumer loans...................      --          .79       --          .29
                                      -----       ------   ------       ------
    Total allowance for loan losses   $ 216       100.00%    $100       100.00%
                                      =====       ======   ======       ======
</TABLE> 

Investment Activities

    Investment Securities.  We are required under federal regulations to
maintain a minimum amount of liquid assets which may be invested in specified
short-term securities and certain other investments.  See "Regulation --
Regulation of Northfield Federal Savings -- Federal Home Loan Bank System" and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations -- Liquidity and Capital Resources." The level of liquid assets
varies depending upon several factors, including: (i) the yields on investment
alternatives, (ii) our judgment as to the attractiveness of the yields then
available in relation to other opportunities, (iii) expectation of future yield
levels, and (iv) our projections as to the short-term demand for funds to be
used in loan origination and other activities.  We classify our investment
securities as "held to maturity", "available-for-sale" or "trading" in
accordance with SFAS No. 115.  At December 31, 1997, our investment portfolio
policy allowed investments in instruments such as: (i) U.S. Treasury
obligations, (ii) U.S. federal agency or federally sponsored agency obligations,
(iii) mortgage-backed securities, (iv) certificates of deposit, and (v) federal
funds, including FHLB overnight and term deposits.

    Mortgage-Backed Securities.  To supplement lending activities, we have
invested in residential mortgage-backed securities.  Mortgage-backed securities
can serve as collateral for borrowings and, through repayments, as a source of
liquidity.  Mortgage-backed securities represent a participation interest in a
pool of single-family or other type of mortgages.  Principal and interest
payments are passed from the mortgage originators, through intermediaries
(generally quasi-governmental agencies) that pool and repackage the
participation interests in the form of securities, to investors such as us.  Our
mortgage-backed securities portfolio consists of participations or pass-through
certificates issued by the Federal Home Loan Mortgage Corporation (the "FHLMC"),
the Federal National Mortgage Association ("FNMA") and the Government National
Mortgage Association ("GNMA").  GNMA certificates are guaranteed as to principal
and interest by the full 

                                       51
<PAGE>
 
faith and credit of the United States, while FHLMC and FNMA certificates are
guaranteed by those agencies only. Our mortgage-backed securities portfolio was
classified as "held to maturity" at December 31, 1997.

    Expected maturities will differ from contractual maturities due to scheduled
repayments and because borrowers may have the right to call or prepay
obligations with or without prepayment penalties.

     Mortgage-backed securities typically are issued with stated principal
amounts.  The securities are backed by pools of mortgages that have loans with
interest rates that are within a set range and have varying maturities.  The
underlying pool of mortgages can be composed of either fixed-rate or adjustable
mortgage loans.  Mortgage-backed securities are generally referred to as
mortgage participation certificates or pass-through certificates.  The interest
rate risk characteristics of the underlying pool of mortgages (i.e., fixed-rate
or adjustable-rate) and the prepayment risk, are passed on to the certificate
holder.  The life of a mortgage-backed pass-through security is equal to the
life of the underlying mortgages.

     The Bank also has a $395,000 investment in a real estate mortgage
investment conduits (REMIC").  REMICs are securities derived by reallocating the
cash flows from mortgage-backed securities or pools of mortgage loans in order
to create multiple classes, or tranches, of securities with coupon rates and
average lives that differ from the underlying collateral as a whole. At December
31, 1997, our REMIC had a weighted average life of two years.  It is a fixed
rate instrument currently paying principal in accordance with a predetermined
schedule with an average yield of 7%.

     REMICs are subject to repayment by the mortgagors of the underlying
collateral at any time. Such prepayment may subject our REMIC to yield and price
volatility.  To assess this volatility, the Federal Financial Institutions
Examination Council ("FFIEC") adopted a policy in 1992 which requires an annual
"stress" test of mortgage derivative securities.  This policy, which has been
adopted by the OTS, requires us to test the REMIC quarterly to determine whether
it is a  high-risk or nonhigh-risk security.   At December 31, 1997, the REMIC
met the criteria established by the policy to be designated as nonhigh-risk
securities for continued classification as a suitable investment.
 
     The following table sets forth the carrying (i.e., amortized cost) value of
our investment securities and mortgage-backed securities, at the dates
indicated.
<TABLE> 
<CAPTION> 
                                                            At December 31,
                                                      --------------------------
                                                         1997            1996
                                                      ----------      ----------
                                                             (In thousands)
<S>                                                   <C>             <C>  
Available for sale:
 Lord Abbett U.S. Government Securities Fund.......    $    --         $   197
Held to Maturity:
 Interest-bearing deposits in other banks..........      3,514           5,186
 Mortgage-backed securities........................      1,955           2,333
 Federal Home Loan Bank of Atlanta stock...........        226             226
                                                       -------         -------
  Total............................................    $ 5,695         $ 7,942
                                                       =======         =======
</TABLE> 

                                       52
<PAGE>
 
     The following table sets forth the scheduled maturities, carrying values,
market values and average yields for our investment portfolio at December 31,
1997.

<TABLE>
<CAPTION>
 
                              One Year or Less     One to Five Years    Five to Ten Years     More than Ten Years
                             -------------------  -------------------  ---------------------  -------------------
                                       Weighted             Weighted               Weighted             Weighted    
                             Carrying   Average   Carrying   Average    Carrying    Average   Carrying   Average    
                              Value      Yield     Value      Yield      Value       Yield     Value      Yield     
                             --------  ---------  --------  ---------  ----------  ---------  --------  ---------   
                                                           (Dollars in thousands)                                   
<S>                          <C>       <C>        <C>       <C>        <C>         <C>        <C>       <C>         
Securities held to maturity:                                                                                        
 Interest-bearing deposits..   $3,257      6.03%      $158      7.51%        $ 99      5.50%    $   --        --%   
 Mortgage-backed securities.      120      5.48         60      7.98          317      8.55      1,458      7.81    
 FHLB stock.................       --                   --                     --                  226      7.25    
                               ------                 ----                   ----               ------              
       Total................   $3,377      6.01%      $218      7.64%        $416      7.82%    $1,684      7.73%   
                               ======                 ====                   ====               ======             

<CAPTION> 

                                  Total Investment Portfolio
                                 -----------------------------
                                                      Weighted 
                                 Carrying    Market    Average 
                                  Value      Value      Yield  
                                 --------    ------   --------
                                    (Dollars in thousands)
<S>                              <C>         <C>      <C>      
Securities held to maturity:                                 
 Interest-bearing deposits..       $3,514    $3,514      6.08%
 Mortgage-backed securities.        1,955     2,011      7.79 
 FHLB stock.................          226       226      7.25 
                                   ------    ------            


       Total................       $5,695    $5,751      6.71% 
                                   ======    ======   

</TABLE> 
                                  

                                       53
<PAGE>
 
Sources of Funds

     Deposits are our major external source of funds for lending and other
investment purposes. Funds are also derived from the receipt of payments on
loans and prepayment of loans and, to a much lesser extent, maturities of
investment securities and mortgage-backed securities, borrowings and operations.
Scheduled loan principal repayments are a relatively stable source of funds,
while deposit inflows and outflows and loan prepayments are significantly
influenced by general interest rates and market conditions.

     Deposits.  Consumer and commercial deposits are attracted principally from
within our primary market area through the offering of a selection of deposit
instruments including regular savings accounts, money market accounts, and term
certificate accounts.  IRA accounts are also offered.  Deposit account terms
vary according to the minimum balance required, the time period the funds must
remain on deposit, and the interest rate.  The interest rates paid by us on
deposits are set weekly at the direction of our senior management.  Interest
rates are determined based on our liquidity requirements, interest rates paid by
our competitors, and our growth goals and applicable regulatory restrictions and
requirements.  We do not accept brokered deposits.

     At December 31, 1997, our deposits were represented by the various types of
savings programs described below.

<TABLE>
<CAPTION>
 
Interest      Minimum                                                         Minimum                       Percentage of
Rate (1)       Term                        Category                            Amount         Balances      Total Savings
- --------      -------                      --------                           -------         --------      -------------
                                                                                        (Dollars in thousands)                
<S>           <C>                    <C>                                      <C>            <C>            <C>
 3.23%         None                  Passbook accounts                         $   25          $ 2,605           7.99%
 2.53          None                  Demand and NOW accounts                       25            2,079           6.37
 4.12          None                  Money market accounts                      1,000            7,816          23.96
                                                                                            
                                     Certificates of Deposit                                
                                     -----------------------                                
                                                                                            
 5.34          6 months              Fixed-Term, Fixed-Rate                       100            1,954           5.99
 5.43          12 months             Fixed-Term, Fixed-Rate                       100            2,394           7.34
 5.45          18 months             Fixed-Term, Fixed-Rate                       100              446           1.37
 5.75          30 months             Fixed-Term, Fixed-Rate                       100              196            .60
 5.92          36 months             Fixed-Term, Fixed-Rate                       100              447           1.37
 6.46          48 months             Fixed-Term, Fixed-Rate                       100              147            .45
 6.63          60 months             Fixed-Term, Fixed-Rate                       100            1,590           4.87
 6.97          72 months             Fixed-Term, Fixed-Rate                       100            4,418          13.54
 6.17                                Other                                      1,000            8,516          26.11
 6.19                                                                                        ---------         ------
 4.24                                   Total certificates of deposit                           20,108          61.64
                                                                                             ---------         ------
                                        Total deposits                                       $  32,608          99.96%
                                                                                             =========         ======
                                     Accrued interest on deposits                                   14            .04
                                                                                             ---------         ------
                                        Total savings on deposits                            $  32,622         100.00%
                                                                                             =========         ======

</TABLE>
- ------------------
(1)  Indicates weighted average interest rate at December 31, 1997.

                                       54
<PAGE>
 
     The following table sets forth our time deposits classified by interest
rate at the dates indicated.

<TABLE> 
<CAPTION> 
                                            At December 31,
                                        -----------------------
                                         1997             1996
                                        ------           ------
              Rate                          (In thousands)
              ----
              <S>                       <C>             <C> 
              4.00 -  5.99%...........  $ 10,996        $ 10,314
              6.00 -  7.99%...........     9,112           6,062
              8.00 -  9.99%...........        --               2
                                        --------        --------
                                        $ 20,108        $ 16,378
                                        ========        ========
</TABLE> 
              
    The following table sets forth the amount and maturities of our time
deposits at December 31, 1997.

<TABLE> 
<CAPTION> 
                                              Amount Due
                     -----------------------------------------------------------
                     Less Than     One to       Two to        After
Rate                  One Year   Two Years   Three Years   Three Years   Total
- ----                  --------   ---------   -----------   -----------   -----
                                          (In thousands)
<S>                  <C>         <C>         <C>           <C>         <C>      
4.00 - 5.99%.......   $ 7,075     $ 2,461      $   454       $ 1,006   $ 10,996
6.00 - 7.99%.......       688       3,321        3,061         2,042      9,112
                      -------     -------      -------       -------   --------
                      $ 7,763     $ 5,782      $ 3,515       $ 3,048   $ 20,108
                      =======     =======      =======       =======   ========
</TABLE> 

    The following table sets forth our savings activity for the periods
indicated:

<TABLE> 
<CAPTION> 
 
                             Balance at                                  Balance at
                            December 31,      % of       Increase       December 31,      % of
                               1997         Deposits    (Decrease)          1996        Deposits
                            ------------    --------    ----------      ------------    --------
                                                   (Dollars in thousands)
<S>                         <C>             <C>         <C>             <C>             <C> 
Demand and NOW accounts....  $ 2,079          6.37%       $  (45)          $ 2,124        7.29%
Money market deposit.......    7,816         23.96          (158)            7,974       27.39
Passbook savings accounts..    2,605          7.99           (22)            2,627        9.03
Certificates of deposit....   18,652         57.18         4,555            14,097       48.42
Jumbo certificates.........    1,456          4.46          (825)            2,281        7.83
Accrued interest on 
 deposits..................       14           .04             1                13         .04
                             -------       -------        ------           -------     -------
                             $32,622        100.00%       $3,506           $29,116      100.00%
                             =======       =======        ======           =======     =======
</TABLE>

     The following table indicates the amount of our certificates of deposit of
$100,000 or more by time remaining until maturity as of December 31, 1997.

<TABLE> 
<CAPTION>  
                                                         Certificates
             Maturity Period                              of Deposit
             ---------------                             ------------
                                                        (In thousands)
              <S>                                        <C>  
             Three months or less.....................     $   100
             Over three through six months............          --
             Over six through 12 months...............          --
             Over 12 months...........................       1,356
                                                           -------
               Total..................................     $ 1,456
                                                           =======
</TABLE> 

                                       55
<PAGE>
 
Savings Deposit Activity

     The following table sets forth our savings activities for the periods
indicated.

<TABLE> 
<CAPTION> 
                                                       Year Ended December 31,
                                                      -------------------------
                                                         1997           1996
                                                       --------       --------
                                                           (In thousands)
<S>                                                    <C>            <C> 
Opening balance....................................    $ 29,103       $ 29,162
Net increase (decrease) before interest credited...       2,027         (1,464)
Interest credited..................................       1,477          1,405
                                                       --------       --------
 Ending balance....................................    $ 32,607       $ 29,103
                                                       ========       ========
 
Net increase(decrease).............................    $  3,504       $    (59)
                                                       ========       ========
 
Percent increase (decrease)........................       12.04%          (.20)%
                                                       ========       ========
</TABLE> 

     Borrowings.  Advances (borrowings) may be obtained from the FHLB of Atlanta
to supplement our supply of lendable funds.  Advances from the FHLB of Atlanta
are typically secured by a pledge of our stock in the FHLB of Atlanta, a portion
of our first mortgage loans and other assets.  Each FHLB credit program has its
own interest rate, which may be fixed or adjustable, and range of maturities.
At December 31, 1997, we had no borrowings from the FHLB of Atlanta.

<TABLE> 
<CAPTION>  
                                                           At or for the
                                                       Year Ended December 31,
                                                      ------------------------
                                                        1997            1996
                                                       ------          ------
                                                       (Dollars in thousands)
<S>                                                   <C>              <C> 
Amounts outstanding at end of period:
  FHLB advances.............................          $    --          $   --
  Other short-term borrowings...............               --              --
Weighted average rate paid on:
  Other short-term borrowings...............               --              --
 
Maximum amount of borrowings outstanding
  at any month end:
  FHLB advances.............................          $ 1,600          $   --
  Other short-term borrowings...............               --              --
 
Approximate average short-term borrowings
  outstanding with respect to:
  FHLB advances.............................          $   350          $   --
  Other short-term borrowings...............               --              --
Approximate weighted average rate paid on:
  Other short-term borrowings...............               --              --
</TABLE> 

                                       56
<PAGE>
 
Competition

     We compete for deposits with other insured financial institutions such as
commercial banks, thrift institutions, credit unions, finance companies, and
multi-state regional banks in our market area.  Loan competition varies
depending upon market conditions.  Our competition in originating real estate
loans comes primarily from commercial banks, thrift institutions, credit unions
and mortgage bankers, many of whom have greater resources than we have.

Properties

    The following table sets forth certain information regarding our offices and
other material property.  For a discussion of planned changes in our properties,
see "Use of Proceeds."

<TABLE>
<CAPTION>
                                                        Book Value at                       Deposits at
                                   Year     Owned or     December 31,      Approximate      December 31,
                                  Opened     Leased        1997 (1)      Square Footage         1997
                                  ------    --------     ----------      --------------     ------------
                                                        (Deposits in thousands)
<S>                               <C>      <C>           <C>             <C>                <C> 
Main Office:
1844 E. Joppa Road                 1983    Leased (2)     $ 14,550             3,150           $ 17,467
Baltimore, Maryland
 
Branch Office:
8705 Harford Road
Baltimore, Maryland                1923    Owned            25,824               750             15,167
 
Executive Offices:
8005 Harford Road
Baltimore, Maryland                1998    Leased (3)          N/A             2,915                 --
                                     
</TABLE>

- --------------- 
(1)  Cost less accumulated depreciation and amortization.
(2)  Present lease expires 08/31/98 and has been renewed through 03/31/03.
(3)  Lease commenced March 10, 1998 and will expire on June 10, 2000.

     The book value of the Bank's investment in premises and equipment totaled
$40,374 at December 31, 1997.  See Note 5 of Notes to Consolidated Financial
Statements.

Personnel

     At December 31, 1997, we had eight full-time and two part-time employees.
None of our employees are represented by a collective bargaining group.  We
believe that our relationship with our employees is good.

Legal Proceedings

     We are, from time to time, a party to legal proceedings arising in the
ordinary course of our business, including legal proceedings to enforce our
rights against borrowers.  We are not currently a party to any legal proceedings
which are expected to have a material adverse effect on our financial
statements.

                                       57
<PAGE>
 
                                   REGULATION

     Set forth below is a brief description of certain laws which relate to us.
The description is not complete and is qualified in its entirety by references
to applicable laws and regulations.

General

     As a federally chartered, SAIF-insured savings institution, we are subject
to extensive regulation by the OTS and the FDIC.  Our lending activities and
other investments must comply with various federal and state statutory and
regulatory requirements, and the OTS periodically examines us for compliance
with various regulatory requirements.  The FDIC also has authority to conduct
periodic examinations of us.  We must file reports with the OTS describing our
activities and our financial condition and we must obtain approvals from
regulatory authorities before entering into certain transactions such as the
conversion or mergers with other financial institutions.  We are also subject to
certain reserve requirements promulgated by the Board of Governors of the
Federal Reserve System ("Federal Reserve System").  Our relationship with our
depositors and borrowers is also regulated to a great extent by federal and
state law, especially in such matters as the ownership of savings accounts and
the form and content of our mortgage documents.  This supervision and regulation
are primarily intended to protect depositors.   The regulatory structure also
gives the regulatory authorities extensive discretion in connection with their
supervisory and enforcement activities and examination policies, including
policies with respect to the classification of assets and the establishment of
adequate loan loss reserves for regulatory purposes.  Any change in regulations,
whether by the OTS, the FDIC or any other government agency, could have a
material adverse impact on our operations.

Regulation of Northfield Federal Savings

     Insurance of Deposit Accounts.  The FDIC maintains two separate funds for
the insurance of deposits up to prescribed statutory limits.  The Bank Insurance
Fund ("BIF") insures the deposits of commercial banks and the SAIF insures the
deposits of savings associations.  We are a member of the SAIF.  The FDIC is
authorized to establish separate annual assessment rates for deposit insurance
for members of the BIF and the SAIF.  The FDIC may increase assessment rates for
either fund if necessary to restore the fund's ratio of reserves to insured
deposits to its target level within a reasonable time and may decrease such
assessment rates if such target level has been met.  The FDIC has established a
risk-based assessment system for both SAIF and BIF members.  Under this system,
assessments are set within a range, based on the risk the institution poses to
its deposit insurance fund.  This risk level is determined based on the
institution's capital level and the FDIC's level of supervisory concern about
the institution.

     Because a significant portion of the assessments paid into the SAIF by
savings institutions were used to pay the cost of prior savings institution
failures in the past years, the reserves of the SAIF fell below the level
required by law.   As a result, deposit insurance premiums for deposits insured
by the BIF (which met its required reserve level) were substantially less than
premiums for 

                                       58
<PAGE>
 
deposits such as ours which are insured by the SAIF. In order to recapitalize
the SAIF and to eliminate the BIF-SAIF premium disparity, in November 1996 the
FDIC imposed a one-time special assessment equal to $0.657 per $100 of SAIF-
assessable deposits held at March 31, 1995, on institutions with deposits
insured by the SAIF. We recognized this special assessment of $182,000 during
fiscal 1996.

     As a result, beginning January 1, 1997, our annual deposit insurance
premium was reduced from 0.23% to .064% of total assessable deposits.  However,
BIF institutions still pay lower assessments than comparable SAIF institutions
because BIF institutions pay only 20% of the rate being paid by SAIF
institutions on their deposits with respect to obligations issued by the
Financing Corp., a federally chartered corporation which provided some of the
financing required to resolve the thrift crisis in the 1980s.

     The recapitalization plan also provides for the merger of the SAIF and BIF
to be effective January 1, 1999, assuming no savings institutions exist under
federal law at that time.  Under separate proposed legislation, Congress is
considering the elimination of the federal thrift charter and the separate
federal regulation of thrifts.  As a result, we might have to convert to a
different financial institution charter and be regulated under federal law as a
national bank or under Maryland law as a state chartered commercial bank,
including being subject to the more restrictive activity limitations imposed on
national banks.  We cannot predict the impact of our conversion to, or
regulation as, a bank until the legislation requiring such change is enacted.

     Regulatory Capital Requirements.  OTS capital regulations require savings
institutions to meet three capital standards: (1) tangible capital equal to at
least 1.5 % of total adjusted assets, (2) core capital equal to at least 3.0% of
total adjusted assets, and (3) risk-based capital equal to at least 8.0% of
total risk-weighted assets.  In addition, the OTS may require that a savings
institution that has a risk-based capital ratio less than 8.0%, a ratio of Tier
1 capital to risk-weighted assets of less than 4.0% or a ratio of Tier 1 capital
to adjusted total assets of less than 4.0% (3.0% if the institution has received
the highest rating on its most recent examination) take certain actions to
increase its capital ratios.   If the institution's capital is significantly
below the minimum required levels or if it is unsuccessful in increasing its
capital ratios, the OTS may significantly restrict its activities.

    Tangible capital is defined as core capital less all intangible assets
(including supervisory goodwill), less certain mortgage servicing rights and
less certain investments.  Core capital is defined as common stockholders'
equity (including retained earnings), non-cumulative perpetual preferred stock
and minority interests in the equity accounts of consolidated subsidiaries,
certain non-withdrawable accounts and pledged deposits of mutual savings
associations and qualifying supervisory goodwill, less non-qualifying intangible
assets, certain mortgage servicing rights and certain investments.  Tier 1 has
the same definition as core capital.

     Risk-based capital equals the sum of core capital plus supplementary
capital.  The components of supplementary capital include, among other items,
cumulative perpetual preferred stock, perpetual subordinated debt, mandatory
convertible subordinated debt, intermediate-term 

                                       59
<PAGE>
 
preferred stock, and the portion of the allowance for loan losses not designated
for specific loan losses. Overall, supplementary capital is limited to 100% of
core capital. A savings institution must calculate its risk-weighted assets by
multiplying each asset and off-balance sheet item by various risk factors as
determined by the OTS, which range from 0% for cash to 100% for delinquent
loans, property acquired through foreclosure, commercial loans, and other
assets. At December 31, 1997, we were in compliance with all regulatory capital
requirements as is shown on the table below.

<TABLE> 
<CAPTION>  
                                                     Percent
                                         Amount     of Assets
                                         -------    ---------
                                        (Dollars in thousands)
      <S>                                <C>        <C>  
      Tangible capital................   $ 2,894         8.02%
      Tangible capital requirement....       541         1.50
                                         -------        -----
        Excess........................   $ 2,353         6.52%
                                         =======        =====
                                          
      Core capital....................   $ 2,894         8.02%
      Core capital requirement........     1,082         3.00
                                         -------        -----
        Excess........................   $ 1,812         5.02%
                                         =======        =====
                                          
      Risk-based capital..............   $ 3,109        17.19%
      Risk-based capital requirement..     1,447         8.00
                                         -------        -----
        Excess........................   $ 1,662         9.19%
                                         =======        =====
</TABLE> 

    The risk-based capital standards of the OTS generally require savings
institutions with more than a "normal" level of interest rate risk to maintain
additional total capital.  An institution's interest rate risk will be measured
in terms of the sensitivity of its "net portfolio value" to changes in interest
rates.  Net portfolio value is defined, generally, as the present value of
expected cash inflows from existing assets and off-balance sheet contracts less
the present value of expected cash outflows from existing liabilities.  A
savings institution will be considered to have a "normal" level of interest rate
risk exposure if the decline in its net portfolio value after an immediate 200
basis point increase or decrease in market interest rates (whichever results in
the greater decline) is less than two percent of the current estimated economic
value of its assets.  An institution with a greater than normal interest rate
risk will be required to deduct from total capital, for purposes of calculating
its risk-based capital requirement, an amount (the "interest rate risk
component") equal to one-half the difference between the institution's measured
interest rate risk and the normal level of interest rate risk, multiplied by the
economic value of its total assets.

     The OTS calculates the sensitivity of an institution's net portfolio value
based on data submitted by the institution in a schedule to its quarterly Thrift
Financial Report and using the interest rate risk measurement model adopted by
the OTS.  The amount of the interest rate risk component, if any, to be deducted
from an institution's total capital will be based on the institution's Thrift
Financial Report filed two quarters earlier.  Savings institutions with less
than $300 million in assets and a risk-based capital ratio above 12% are
generally exempt from filing the interest rate risk schedule with their Thrift
Financial Reports.  However, the OTS may require any exempt 

                                       60
<PAGE>
 
institution that it determines may have a high level of interest rate risk
exposure to file such schedule on a quarterly basis and may be subject to an
additional capital requirement based upon its level of interest rate risk as
compared to its peers. Due to our size and risk-based capital level, we are
exempt from the interest rate risk component.

    Dividend and Other Capital Distribution Limitations.  OTS regulations
require us to give the OTS 30 days advance notice of any proposed declaration of
dividends to the Company. The OTS may prohibit the payment of dividends by us to
the Company.  In addition, we may not declare or pay a cash dividend on our
capital stock if the effect would be to reduce our regulatory capital below the
amount required for the liquidation account to be established at the time of the
conversion.  See "The Conversion -- Effects of Conversion to Stock Form on
Depositors and Borrowers of Northfield Federal Savings -- Liquidation Account."

    OTS regulations limit upon all capital distributions by savings
institutions, such as cash dividends, payments to repurchase or otherwise
acquire its shares, payments to stockholders of another institution in a cash-
out merger, and other distributions charged against capital.  The rule
establishes three tiers of institutions based primarily on an institution's
capital level.  An institution that exceeds all of its fully phased-in capital
requirements before and after a proposed capital distribution ("Tier 1
institution") and has not been advised by the OTS that it is in need of more
than the normal supervision can, after prior notice but without the approval of
the OTS, make capital distributions during a calendar year equal to the greater
of (i) 100.0% of its net income to date during the calendar year plus the amount
that would reduce by one-half its "surplus capital ratio" (the excess capital
over its fully phased-in capital requirements) at the beginning of the calendar
year, or (ii) 75% of its net income over the most recent four quarter period.
Any additional capital distributions require prior regulatory notice.  As of
December 31, 1997, we qualified as a Tier 1 institution.

    In the event our capital falls below our fully phased-in requirement or the
OTS notifies us that we are in need of more than normal supervision, we would
become a Tier 2 or Tier 3 institution and as a result, our ability to make
capital distributions could be restricted.  Tier 2 institutions, which are
institutions that before and after the proposed distribution meet their current
minimum capital requirements, may only make capital distributions of up to 75%
of net income over the most recent four quarter period.  Tier 3 institutions,
which are institutions that do not meet current minimum capital requirements and
propose to make a capital distribution, and Tier 2 institutions that propose to
make a capital distribution in excess of the noted safe harbor level, must
obtain OTS approval prior to making such distribution.  In addition, the OTS
could prohibit a proposed capital distribution by any institution, which would
otherwise be permitted by the regulation, if the OTS determines that such
distribution would constitute an unsafe or unsound practice.  The OTS has
proposed rules relaxing certain approval and notice requirements for well-
capitalized institutions.

    A savings institution is prohibited from making a capital distribution if,
after making the distribution, the savings institution would be undercapitalized
(i.e., not meet any one of its minimum regulatory capital requirements).
Further, a savings institution cannot distribute regulatory capital that is
needed for its liquidation account.

                                       61
<PAGE>
 
    Qualified Thrift Lender Test.  Savings institutions must meet a Qualified
Thrift Lender test. We must maintain at least 65% of our portfolio assets (total
assets less intangible assets, property we use in conducting our business and
liquid assets in an amount not exceeding 20% of total assets) in Qualified
Thrift Investments to satisfy the test.  Qualified Thrift Investments consist
primarily of residential mortgage loans and mortgage-backed and other securities
related to domestic, residential real estate or manufactured housing.  The
shares of stock we own in the FHLB of Atlanta also qualify as Qualified Thrift
Investments.  Subject to an aggregate limit of 20% of portfolio assets, we may
also count the following as Qualified Thrift Investments: (i) 50% of the dollar
amount of residential mortgage loans originated for sale, (ii) investments in
the capital stock or obligations of any service corporation or operating
subsidiary as long as such subsidiary derives at least 80% of its revenues from
domestic housing related activities, (iii) 200% of the dollar amount of loans
and investments to purchase, construct or develop "starter homes," subject to
certain other restrictions, (iv) 200% of the dollar amount of loans for the
purchase, construction or development of domestic residential housing or
community centers in "credit needy" areas or loans for small businesses located
in such areas, (v) loans for the purchase, construction or development of
community centers, (vi) loans for personal, family, household or educational
purposes, subject to a maximum of 10% of portfolio assets, and (vii) shares of
FHLMC or FNMA stock.

    If we satisfy the test, we will continue to enjoy full borrowing privileges
from the FHLB of Atlanta.  If we do not satisfy the test we may lose our
borrowing restrictions and be subject to activities and branching restrictions
applicable to national banks.  Compliance with the Qualified Thrift Lender test
is determined on a monthly basis in nine out of every 12 months.  As of December
31, 1997, we were in compliance with our Qualified Thrift Lender requirement
with approximately 98.79% of our assets invested in Qualified Thrift
Investments.

    Transactions With Affiliates.  Generally, transactions between a savings
institution and its affiliates are subject to certain limitations.  Such
transactions must be on terms as favorable to the savings institution as
comparable transactions with non-affiliates.  In addition, certain of these
transactions are restricted to an aggregate percentage of the savings
institution's capital.  Collateral in specified amounts must usually be provided
by affiliates in order to receive loans from the savings institution.   Our
affiliates include the Company and any company which would be under common
control with us.  In addition, a savings institution may not extend credit to
any affiliate engaged in activities not permissible for a bank holding company
or acquire the securities of any affiliate that is not a subsidiary.  The OTS
has the discretion to treat subsidiaries of savings institution as affiliates on
a case-by-case basis.

    Loans to Directors, Executive Officers and Principal Stockholders.  Loans
from us to our directors, executive officers and, subsequent to the conversion,
our principal stockholders may not be made on terms more favorable than those
afforded to other borrowers.  In addition, we cannot make loans in excess of
certain levels to directors, executive officers or 10% or greater stockholders
(or any of their affiliates) unless the loan is approved in advance by a
majority of our board of 

                                       62
<PAGE>
 
directors with any "interested" director not voting. We are also prohibited from
paying any overdraft of any of our executive officers or directors. We are also
subject to certain other restrictions on the amount and type of loans to
executive officers and directors and must annually report such loans to our
regulators.

    Liquidity Requirements.  All savings institutions are required to maintain
an average daily balance of liquid assets equal to a certain percentage of the
sum of its average daily balance of net withdrawable deposit accounts and
borrowings payable in one year or less.  The liquidity requirement may vary from
time to time (between 4% and 10%) depending upon economic conditions and savings
flows of all savings institutions.  At December 31, 1997, our required liquid
asset ratio was 4% and our actual ratio was 8.9%.  Monetary penalties may be
imposed upon institution for violations of liquidity requirements.

    Federal Home Loan Bank System.  We are a member of the FHLB of Atlanta,
which is one of 12 regional FHLBs.  Each FHLB serves as a reserve or central
bank for its members within its assigned region.  It is funded primarily from
funds deposited by savings institutions and proceeds derived from the sale of
consolidated obligations of the FHLB System.  It makes loans to members (i.e.,
advances) in accordance with policies and procedures established by the board of
directors of the FHLB.

    As a member, we are required to purchase and maintain stock in the FHLB of
Atlanta in an amount equal to at least 1% of our aggregate unpaid residential
mortgage loans, home purchase contracts or similar obligations at the beginning
of each year, or 1/20 of our advances from the FHLB of Atlanta, whichever is
greater.  At December 31, 1997, we had $226,000 in FHLB stock, at cost, which
was in compliance with this requirement.

    Federal Reserve System.  The Federal Reserve System requires all depository
institutions to maintain non-interest bearing reserves at specified levels
against their transaction accounts (primarily checking, NOW and Super NOW
checking accounts) and non-personal time deposits.  The balances maintained to
meet the reserve requirements imposed by the Federal Reserve System may be used
to satisfy the liquidity requirements that are imposed by the OTS.  At December
31, 1997, our reserve met the minimum level required by the Federal Reserve
System.

Holding Company Regulation

    General.  The Company will be required to register and file reports with the
OTS and will be subject to regulation and examination by the OTS.  In addition,
the OTS will have enforcement authority over the Company and any non-savings
institution subsidiaries.  This will permit the OTS to restrict or prohibit
activities that it determines to be a serious risk to us.  This regulation  is
intended primarily for the protection of our depositors and not for the benefit
of you, as stockholders of the Company.

                                       63
<PAGE>
 
    The Company will also be required to file certain reports with, and comply
with the rules and regulations of the SEC under the federal securities laws.

    Activities Restrictions.  Since the Company will only own one savings
institution, it will be able to diversify its operations into activities not
related to banking, but only so long as we satisfy the Qualified Thrift Lender
Test.  If the Company controls more than one savings institution, it would lose
the ability to diversify its operations into non-banking related activities,
unless such other savings institutions each also qualify as a Qualified Thrift
Lender and were acquired in a supervised acquisition.  See "-- Qualified Thrift
Lender Test."

     Restrictions on Acquisitions.  The Company must obtain approval from the
OTS before acquiring control of any other savings institution or savings and
loan holding company, substantially all the assets thereof or in excess of 5% of
the outstanding shares of another savings institution or savings and loan
holding company. The Company's directors and officers or persons owning or
controlling more than 25% of the Company's stock, must also obtain approval of
the OTS before acquiring control of any savings institution or savings and loan
holding company.

     The OTS may only approve acquisitions that will result in the formation of
a multiple savings and loan holding company which controls savings institutions
in more than one state if:  (i) the multiple savings and loan holding company
involved controls a savings institution which operated a home or branch office
in the state of the institution to be acquired as of March 5, 1987; (ii) the
acquiror is authorized to acquire control of the savings institution pursuant to
the emergency acquisition provisions of the Federal Deposit Insurance Act; or
(iii) the statutes of the state in which the institution to be acquired is
located specifically permit institutions to be acquired by state-chartered
institutions or savings and loan holding companies located in the state where
the acquiring entity is located (or by a holding company that controls such
state-chartered savings institutions).

     Federal Securities Law. The Company has filed with the SEC a Registration
Statement under the Securities Act of 1933, as amended (the "Securities Act"),
for the registration of the common stock.  Upon completion of the conversion,
the common stock will be registered with the SEC under the Exchange Act and,
under OTS regulations, generally may not be deregistered for at least three
years thereafter. The Company will be subject to the information, proxy
solicitation, insider trading restrictions and other requirements of the
Exchange Act.

     The registration under the Securities Act of the common stock does not
cover the resale of such shares.  Shares of the common stock purchased by
persons who are not affiliates of the Company may generally be resold without
registration.  Shares purchased by an affiliate of the Company will be subject
to certain resale restrictions.  As long as the Company meets the current public
information requirements, each affiliate of the Company who complies with the
other conditions would be able to sell a limited number of shares based upon the
number of shares outstanding and the average trading volume for the common
stock.

                                       64
<PAGE>
 
                                   TAXATION

Federal Taxation

    We are subject to the provisions of the Internal Revenue Code of 1986, as
amended (the "Code"), in the same general manner as other corporations.
However, prior to August 1996, savings institutions such as us, which met
certain definitional tests and certain other conditions prescribed by the Code
could benefit from certain favorable provisions regarding their deductions from
taxable income for annual additions to their bad debt reserve.  The amount of
the bad debt deduction that a qualifying savings institution could claim for tax
purposes with respect to additions to its reserve for bad debts for "qualifying
real property loans" could be based upon our actual loss experience (the
"experience method") or as a percentage of our taxable income (the "percentage
of taxable income method").  Historically, we used the method that would allow
us to take the largest deduction.

     In August 1996, the Code was revised to equalize the taxation of savings
institutions and banks.  Savings institutions, such as us, no longer have a
choice between the percentage of taxable income method and the experience method
in determining additions to bad debt reserves.  Thrifts with $500 million of
assets or less may still use the experience method, which is generally available
to small banks currently.  Larger thrifts may only take a tax deduction when a
loan is actually charged off.  Any reserve amounts added after 1987 will be
taxed over a six year period beginning in 1996; however, bad debt reserves set
aside through 1987 are generally not taxed.  A savings institution may delay
recapturing into income its post-1987 bad debt reserves for an additional two
years if it meets a residential-lending test.  This law is not expected to have
a material impact on us. At December 31, 1997, we had $136,602 of post-1987 bad-
debt reserves.

     Earnings appropriated to our bad debt reserve and claimed as a tax
deduction including our supplemental reserves for losses will not be available
for the payment of cash dividends or for distribution (including distributions
made on dissolution or liquidation), unless we include the amount in income,
along with the amount deemed necessary to pay the resulting federal income tax.
If such amount is used for any purpose other than bad debt losses, including a
dividend distribution or a distribution in liquidation, it will be subject to
federal income tax at the then current rate.

     The Code imposes a tax ("AMT") on alternative minimum taxable income
("AMTI") at a rate of 20%. AMTI is increased by certain preference items,
including the excess of the tax bad debt reserve deduction using the percentage
of taxable income method over the deduction that would have been allowable under
the experience method.  Only 90% of AMTI can be offset by net operating loss
carryovers of which we currently have none.  AMT is also adjusted by
determining the tax treatment of certain items in a manner that negates the
deferral of income resulting from the regular tax treatment of those items.
Thus, our AMT is increased by an amount equal to 75% of the amount by which our
adjusted current earnings exceeds our AMT (determined without regard to this
adjustment and prior to reduction for net operating losses).  In tax years 
beginning after December 31, 1997 a "small" corporation will not be subject to
the AMT because its tentative minimum tax will be treated as zero. For a tax
year beginning in 1998, a corporation that has had average annual gross receipts
of corporation. Once a corporation is recognized as a small corporation, it will
continue to be exempt from AMT as long as its average annual gross receipts for
the prior 3-year period is not in excess of $7,500,000. If a corporation ceases
to be a small corporation, the AMT will apply prospectively only.



                                       65
<PAGE>
 
     The Company may exclude from its income 100% of dividends received from us
as a member of the same affiliated group of corporations.  A 70% dividends
received deduction generally applies with respect to dividends received from
corporations that are not members of such affiliated group, except that an 80%
dividends received deduction applies if the Company owns more than 20% of the
stock of a corporation paying a dividend.  The above exclusion amounts, with the
exception of the affiliated group figure, were reduced in years in which we
availed our self of the percentage of taxable income bad debt deduction method.

     Our federal income tax returns have not been audited by the IRS in the last
ten years.

State Taxation

     We will continue to be subject to Maryland corporation income tax which is
7%.  The Company is incorporated under Maryland  law.

 
                           MANAGEMENT OF THE COMPANY

    Our board of directors consists of the same individuals who serve as
directors of Northfield Federal Savings.  Our articles of incorporation and
bylaws require that directors be divided into three classes, as nearly equal in
number as possible.  Each class of directors serves for a three-year period,
with approximately one-third of the directors elected each year.  Our officers
will be elected annually by the board and serve at the board's discretion.

    The following individuals will serve as executive officers of the Company.

             Name             Position(s) with the Company
             ----             ----------------------------

        G. Ronald Jobson      President and Chief Executive Officer
        John P. Sabol, Jr.    Vice President/Treasurer/Chief Financial Officer
        J. Thomas Hoffman     Secretary

                                       66
<PAGE>
 
 MANAGEMENT OF NORTHFIELD FEDERAL SAVINGS

Directors and Executive Officers

     Our board of directors is composed of six members, each of whom serves for
a term of three years.  Our proposed stock charter and bylaws require that
directors be divided into three classes, as nearly equal in number as possible.
Each class of directors serves for a three-year period, with approximately one-
third of the directors elected each year.  Our officers are elected annually by
our board and serve at the board's discretion.

    The following table sets forth information with respect to our directors and
executive officers, all of whom will continue to serve in the same capacities
after the conversion.
<TABLE>
<CAPTION>
 
                              Age as of       Positions(2)     Director   Term
Name                      December 31, 1997   with the Bank     Since    Expires
- ----                      -----------------   -------------     -----    -------
<S>                       <C>                <C>               <C>       <C>
 
Gary R. Bozel                     40         Chairman of the       1985     2001
                                             Board
                                           
G. Ronald Jobson                  61         President,            1994     2000
                                             Chief Executive
                                             Officer and Director
                                           
J. Thomas Hoffman                 50         Secretary and         1983     2000
                                             Director
                                           
E. Thomas Lawrence, Jr.           43         Director              1994     1999
                                           
David G. Rittenhouse              81         Director              1974     1999
                                           
William R. Rush                   41         Director              1983     2001

<CAPTION> 
                                 
Executive Officers Who Are Not Directors                             
- ----------------------------------------   
<S>                               <C>        <C> 
Anthony B. Quigley                60         Vice President
                                           
John P. Sabol, Jr.                32         Vice President, 
                                             Chief Financial
                                             Officer and Treasurer
</TABLE>


     The business experience for the past five years of each of the directors
and executive officers is as follows:

     Gary R. Bozel is a self-employed certified public accountant practicing in
Towson, Maryland.  He has served as our Chairman of the Board since 1996 and
served as our President from 1993 to 1996.  He is a member of the board of
directors and finance committee of the Towson Golf and Country Club.

                                       67
<PAGE>
 
     G. Ronald Jobson has been our President and Chief Executive Officer since
1996.  From 1984 to that time,  he served as our Executive Vice President and
Chief Executive Officer.  He is active with the Country Club of Maryland and
Parkville American Legion Post 184.

     J. Thomas Hoffman serves as our Secretary and is a self-employed sales
consultant of financial products in Towson, Maryland.  Mr. Hoffman is also a
registered representative with John Hancock Financial Distributors Services,
Inc., and is a member of the Parkville Optimist Club and Towson Business
Association.

     E. Thomas Lawrence, Jr., is a painting contractor with Preferred Painting &
Wall Covering Services, Inc., located in Fallston, Maryland; from 1972 to July
1995 he was Vice President of Painting Services, Inc. in Baltimore, Maryland.

     David G. Rittenhouse is the chief executive officer of the Rittenhouse Fuel
Company, a heating oil, heat and air conditioning servicer located in Baltimore,
Maryland.

     William R. Rush is a teacher and director of summer programs at the
McDonogh School. Prior to 1997, Mr. Rush was a real estate appraiser and owner
of a bar and restaurant in Parkville, Maryland.  He is a member of the Maryland
Association of Physical Education, Health, Recreation & Dance, the Maryland
State Youth Soccer Association and Senior Olympics.

     Anthony B. Quigley has been employed by us since 1984 and currently serves
as our Vice President, Security Officer and Savings Compliance Officer.  He is a
member of the Glen Burnie Park Improvement Association and the Holy Trinity
Roman Catholic Church.

     John P. Sabol, Jr. has been employed with us  since February 1993.  He
began his employment with us as a management trainee and, in November 1997, was
appointed as our Vice President and Chief Financial Officer.  He is a member of
the Financial Managers Society.

Meetings and Committees of the Board of Directors

    The board of directors conducts its business through meetings of the board
and through activities of its committees.  During the year ended December 31,
1997, the board of directors held 26 regular meetings and two special meetings.
No director attended fewer than 75% of the total meetings of the board of
directors and committees on which such director served during the year ended
December 31, 1997.

Director Compensation

    Our board meets twice per month.  Each of the directors is paid an annual
fee of $5,400.  Total aggregate fees paid to the current directors, including a
$6,000 year-end bonus paid to each director, for the year ended December 31,
1997 were $68,635.

                                       68
<PAGE>
 
    Deferred Compensation Plan.  We adopted the Northfield Federal Savings
Deferred Compensation Plan, effective December 24, 1997 for our directors and
select executive officers.  On the effective date, we established a bookkeeping
account in the name of each participant.  On December 31, 1997, each director's
account was credited with an amount equal to the product of (i) $2,500, and (ii)
the director's full years of service as a director, up to 10 years.   In
recognition of their accrued years of service for us, the accounts of Messrs.
Bozel, Hoffman, Jobson, Lawrence, Rittenhouse and Rush were credited with
$25,000, $25,000, $7,500, $7,500, $25,000 and $25,000, respectively.  Under the
plan, before each calendar year begins, each non-employee director may elect to
defer receipt of all or part of his future fees and any other participant may
elect to defer receipt of up to 25% of his salary or 100% of his bonus
compensation for the year.  Deferred amounts are credited at the end of the
calendar year to the participant's account.  All amounts credited to
participants' accounts are fully vested at all times.  Until distributed in
accordance with the terms of the plan, each participant's account will be
credited with a rate of return equal to our highest rate of interest paid on our
one-year certificates of deposit.  Following the conversion, each participant
may prospectively elect to have his account credited with either the highest
return paid by us on our one-year certificates of deposit or the total return on
the common stock of our holding company.

    Each participant may elect to receive plan benefits in a lump sum or in
equal annual payments over a period of years designated by the participant.  In
the absence of an election the participant will receive payments in five
substantially equal installments.  In the event of a participant's death, the
balance of his plan account will be paid in a lump sum (unless the participant
elects to continue the previously designated distribution method) to his
designated beneficiary, or if none, his estate.

    Any compensation accrued under the plan will be paid from our general
assets.  We have established a trust in order to hold assets with which to pay
compensation.  Trust assets would be subject to claims of our general creditors.
In the event a participant prevails over us in a legal dispute as to the terms
or interpretation of the plan, he would be reimbursed for his legal and other
expenses.  Upon the implementation of the plan, we recognized compensation
expense totaling $115,000 to provide for participants' initial account balances.

Executive Compensation

    Summary Compensation Table.  The following table sets forth the cash and
non-cash compensation awarded to or earned by our chief executive officer at
December 31, 1997.  No other employee earned in excess of $100,000 for the year
ended December 31, 1997.

                                Annual Compensation
                         ---------------------------------
                                             Other Annual        All Other
Name              Year   Salary    Bonus   Compensation(1)    Compensation(2)
- ----              ----   ------    -----   ---------------    ---------------

G. Ronald Jobson  1997  $ 58,000  $ 8,000      $ 11,400           $ 6,515

- -----------
(1)  Consists of director fees.
(2)  Consists of 401-k Plan contribution ($3,300) and country club fees
     ($3,215).

                                       69
<PAGE>
 
     Employment Agreement.  We have entered into an employment agreement with
our President, G. Ronald Jobson [Disclosure to Come.]

     Employee Stock Ownership Plan.  We have established the ESOP for the
exclusive benefit of participating employee of ours, to be implemented upon the
completion of the conversion. Participating employees are employees who have
completed one year of service with us (including at least 1,000 hours of
service) and have attained the age of 21.  An application for a letter of
determination as to the tax-qualified status of the ESOP will be submitted to
the IRS.  Although no assurances can be given, we expect that the ESOP will
receive a favorable letter of determination from the IRS.

     The ESOP is to be funded by contributions made by us in cash or common
stock.  Benefits may be paid either in shares of the common stock or in cash.
In accordance with the Plan, the ESOP may borrow funds with which to acquire up
to 8.0% of the common stock to be issued in the conversion.  The ESOP intends to
borrow funds from the Company.  The loan is expected to be for a term of 12
years at an annual interest rate equal to the prime rate plus one percentage
point, adjusted annually on each January 1st.   Presently it is anticipated that
the ESOP will purchase up to 8.0% of the common stock to be issued in the
offering (36,000 shares based on the midpoint of the Estimated Valuation Range).
The loan will be secured by the shares purchased.  Shares purchased with such
loan proceeds will be held in a suspense account for allocation among
participants as the loan is repaid.  We anticipate contributing approximately
$______ annually (based on a 36,000 purchase) to the ESOP to meet principal
obligations under the ESOP loan, as proposed. It is anticipated that all such
contributions will be tax-deductible.  This loan is expected to be fully repaid
in approximately 12 years.

     Shares sold above the maximum of the Estimated Valuation Range (i.e., more
than 517,500 shares) may be sold to the ESOP before satisfying remaining
unfilled orders of Eligible Account Holders to fill the ESOP's subscription or
the ESOP may purchase some or all of the shares covered by its subscription
after the conversion in the open market.

     Contributions to the ESOP and shares released from the suspense account
will be allocated among participants on the basis of total compensation,
excluding bonuses.  All participants must be employed at least 500 hours in a
plan year in order to receive an allocation.  Participants will become 20%
vested in their ESOP account balances for each year of service beginning with
the first year of service, up to a maximum of 100% for five years of service.
Vesting will be accelerated upon retirement, death, disability, change in
control of the Company, or termination of the ESOP. Forfeitures will be
reallocated to participants on the same basis as other contributions in the plan
year.  Benefits will be payable in the form of a lump sum upon retirement,
death, disability or separation from service.  Our contributions to the ESOP are
discretionary and may cause a reduction in other forms of compensation.
Therefore, benefits payable under the ESOP cannot be estimated.

                                       70
<PAGE>
 
     In the event of a change in control of us, the outstanding balance of any
loans used to finance the purchase of shares by the ESOP will be payed off
through a transfer or sale of shares held as collateral under such loan, with
any remaining shares allocated to participant accounts pro rata based on their
account balances.  Participants terminating employment on or after the change in
control will be entitled to receive a cash payment from the Company equal to the
amount, if any, which would have been allocated to the participant's account
immediately following the change in control but was precluded from allocation
based on allocation limits applicable under federal tax laws.

     The board of directors has appointed non-employee directors to the ESOP
Committee to administer the ESOP and to serve as the initial ESOP Trustees.  The
board of directors or the ESOP Committee may instruct the ESOP Trustees
regarding investments of funds contributed to the ESOP. The ESOP Trustees must
vote all allocated shares held in the ESOP in accordance with the instructions
of the participating employees.  Unallocated shares and allocated shares for
which no timely direction is received will be voted by the ESOP Trustees as
directed by the board of directors or the ESOP Committee, subject to the
Trustees' fiduciary duties.

Proposed Future Stock Benefit Plans

     Stock Option Plan.  We intend to adopt a stock option plan (the Option
Plan) following the conversion, subject to approval by the Company's
stockholders, at a stockholders' meeting which we currently expect to be held no
sooner than one year after the conversion.  However, the Company may hold a
stockholders' meeting as soon as six months after the conversion to adopt the
Option Plan.  If the Option Plan is adopted during the first year following the
conversion, the Option Plan would be in compliance with the OTS conversion
regulations in effect.  See "-- Restrictions on Stock Benefit Plans."  If the
Option Plan is implemented more than one year after the conversion, which we
expect, the Option Plan will comply with OTS regulations and policies that are
applicable at such time.  If the Option Plan is implemented within one year
after the conversion, in accordance with OTS regulations, a number of shares
equal to 10% of the aggregate shares of common stock to be issued in the
offering (i.e., 45,000 shares based upon the sale of 450,000 shares at the
midpoint of the Estimated Valuation Range) would be reserved for issuance by the
Company upon exercise of stock options to be granted to our officers, directors
and employees from time to time under the Option Plan.  The purpose of the
Option Plan would be to provide additional performance and retention incentives
to certain officers, directors and employees by facilitating their purchase of a
stock interest in the Company.  Under the OTS conversion regulations, the Option
Plan, would provide for a term of 10 years, after which no awards could be made,
unless earlier terminated by the board of directors pursuant to the Option Plan
and the options would vest over a five year period (i.e., 20% per year),
beginning one year after the date of grant of the option.  Options would expire
no later than 10 years from the date granted and would expire earlier if the
Option Committee so determines or in the event of termination of employment.
Options would be granted based upon several factors, including seniority, job
duties and responsibilities, job performance, our financial performance and a
comparison of awards given by other savings institutions converting from mutual
to stock form.

                                       71
<PAGE>
 
     The Company would receive no monetary consideration for the granting of
stock options under the Option Plan.  It would receive the option price for each
share issued to optionees upon the exercise of such options.  Shares issued as a
result of the exercise of options will be either authorized but unissued shares
or shares purchased in the open market by the Company.  However, no purchases in
the open market will be made that would violate applicable regulations
restricting purchases by the Company.  The exercise of options and payment for
the shares received would contribute to the equity of the Company.

     Management Recognition Plan.  We intend to adopt the MRP following the
conversion, the objective of which is to enable us to retain personnel and
directors of experience and ability in key positions of responsibility.  The
Company expects to hold a stockholders' meeting no sooner than one year after
the conversion in order for stockholders to vote to approve the MRP, but may
elect instead to hold a stockholders' meeting as early as six months after the
conversion.  If the MRP is implemented within one year after the conversion, in
accordance with applicable OTS regulations, the shares granted under the MRP
will be in the form of restricted stock vesting over a five year period (i.e.,
20% per year) beginning one year after the date of grant of the award.
Additionally, the number of shares to be granted could not exceed 4% of the
shares sold in the conversion if the MRP is adopted during the first year
following conversion.  If the MRP is implemented more than one year after the
conversion, the MRP will comply with such OTS regulations and policies that are
applicable at such time.  Compensation expense in the amount of the fair market
value of the common stock granted will be recognized pro rata over the years
during which the shares are payable.  Until they have vested, such shares may
not be sold, pledged or otherwise disposed of and are required to be held in
escrow.  Any shares not so allocated would be voted by the MRP Trustees. Awards
would be granted based upon a number of factors, including seniority, job duties
and responsibilities, job performance, our performance and a comparison of
awards given by other institutions converting from mutual to stock form.  The
MRP would be managed by a committee of non-employee directors (the "MRP
Trustees").  The MRP Trustees would have the responsibility to invest all funds
contributed by us to the trust created for the MRP (the "MRP Trust").

     We expect to contribute sufficient funds to the MRP so that the MRP Trust
can purchase, in the aggregate, up to 4% of the amount of common stock that is
sold in the conversion.  The shares purchased by the MRP would be authorized but
unissued shares or would be purchased in the open market.  Whether such shares
will be purchased in the open market or newly issued of the Company, and the
timing of such purchases, will depend on market and other conditions and the
alternative uses of capital available to the Company.  In the event the market
price of the common stock is greater than $10.00 per share, our contribution of
funds will be increased.  Likewise, in the event the market price is lower than
$10.00 per share, our contribution will be decreased.  In recognition of their
prior and expected services to us and the Company, as the case may be, the
officers, other employees and directors responsible for implementation of the
policies adopted by the board of directors and our profitable operation will,
without cost to them, be awarded stock under the MRP. Based upon the sale of
450,000 shares of common stock in the offering at the midpoint of the Estimated
Valuation Range, the MRP Trust is expected to purchase up to 18,000 shares of
common stock.

                                       72
<PAGE>
 
     Restrictions on Stock Benefit Plans.  OTS regulations provide that in the
event we implement stock option or management and/or employee stock benefit
plans within one year from the date of conversion, such plans must comply with
the following restrictions: (i) the plans must be fully disclosed in the
prospectus, (ii) for stock option plans, the total number of shares for which
options may be granted may not exceed 10% of the shares issued in the
conversion, (iii) or restricted stock plans such as the MRP, the shares may not
exceed 3% of the shares issued in the conversion (4% for institutions with 10%
or greater tangible capital), (iv) the aggregate amount of stock purchased by
the ESOP in the conversion may not exceed 10% (12% for well-capitalized
institutions utilizing a 4% management recognition plan), (v) no individual
employee may receive more than 25% of the available awards under the Option Plan
or the MRP, (vi) directors who are not employees may not receive more than 5%
individually or 30% in the aggregate of the awards under any plan, (vii) all
plans must be approved by a majority of the total votes eligible to be cast at
any duly called meeting of the Company's stockholders held no earlier than six
months following the conversion, (viii) for stock option plans, the exercise
price must be at least equal to the market price of the stock at the time of
grant, (ix) for restricted stock plans such as the MRP, no stock issued in a
conversion may be used to fund the plan, (x) neither stock option awards nor
restricted stock awards may vest earlier than 20% as of one year after the date
of stockholder approval and 20% per year thereafter, and vesting may be
accelerated only in the case of disability or death (or if not inconsistent with
applicable OTS regulations in effect at such time, in the event of a change in
control), (xi) the proxy material must clearly state that the OTS in no way
endorses or approves of the plans, and (xii) prior to implementing the plans,
all plans must be submitted to the Regional Director of the OTS within five days
after stockholder approval with a certification that the plans approved by the
stockholders are the same plans that were filed with and disclosed in the proxy
materials relating to the meeting at which stockholder approval was received.

Certain Related Transactions

     During the year ended December 31, 1997, certain of our officers and
directors had loans from us totaling approximately $618,000.  All of such loans
were made in the ordinary course of business, were made on substantially the
same terms, including interest rates and collateral, as those prevailing at the
time for comparable transactions with other persons and did not involve more
than the normal risk of collectibility or present other unfavorable features.

                  RESTRICTIONS ON ACQUISITIONS OF THE COMPANY

     The following discussion is a general summary of the material provisions of
the articles of incorporation and bylaws of the Company and certain other
Maryland corporate law and regulatory provisions, which may be deemed to have
such an anti-takeover effect.  The description of these provisions is
necessarily general and we refer you, in each case, to the articles of
incorporation and bylaws of the Company which are incorporated herein by
reference.  See "Available Information" as to how to obtain a copy of these
documents.

                                       73
<PAGE>
 
     While our board of directors is not aware of any effort that might be made
to obtain control of the Company after conversion, our board of directors
believes that it is appropriate to include certain provisions as part of the
Company's articles of incorporation and bylaws to protect the interests of the
Company and its stockholders from hostile takeovers ("anti-takeover"provisions)
which the board of directors might conclude are not in the best interests of us
or our stockholders. These provisions may have the effect of discouraging a
future takeover attempt which is not approved by the board of directors but
which individual stockholders may deem to be in their best interests or in which
stockholders may receive a substantial premium for their shares over the current
market prices.  As a result, stockholders who might desire to participate in
such a transaction may not have an opportunity to do so.  Such provisions will
also render the removal of the current board of directors or management of the
Company more difficult.

Provisions of the Company's Articles of Incorporation and Bylaws

     Restriction on Acquisition of Common Stock; Limitations on Voting Rights.
The charter of the Company provides that, for a period of five years after
completion of the conversion, no person may directly or indirectly, acquire or
offer to acquire beneficial ownership of more than 10% of any class of equity
security outstanding of the Company (the "Limit"), unless the "continuing" board
of directors has first approved by a two-thirds vote the offer or acquisition.
Any shares acquired in violation of this restriction will not be counted as
shares outstanding for voting purposes, nor will the holder be entitled to vote
such shares.  After five years from the date of conversion, should any party
acquire the beneficial ownership of shares in excess of 10%, the record holders
of more than 10% of any outstanding class of equity security of the Company who
obtained such shares without the requisite approval would be entitled to cast
only one-hundredth (1/100) of a vote for each share owned in excess of 10%, and
the aggregate voting power of such holders shall be allocated proportionately
among such record holders.  A person is a beneficial owner of a security if he
has the power to vote or direct the voting of all or part of the voting rights
of the security, or has the power to dispose of or direct the disposition of the
security. The Company's articles of incorporation further provide that this
provision limiting voting rights may only be amended upon the vote of 80% of the
outstanding shares of voting stock.

     Election of Directors. The Company's articles of incorporation provide that
the board of directors of the Company will be divided into three staggered
classes, with directors in each class elected for three-year terms. As a result
of this provision, it would take two annual elections to replace a majority of
the Company's board. The Company's articles of incorporation provide that the
size of the board of directors may be increased or decreased only if two-thirds
of the directors then in office concur in such action. The articles of
incorporation also provide that any vacancy occurring in the board of directors,
including a vacancy created by an increase in the number of directors, shall be
filled for the remainder of the unexpired term by a majority vote of the
directors then in office. Finally, the articles of incorporation and the bylaws
impose certain notice and information requirements in connection with the
nomination by stockholders of candidates for election to the board of directors
or the proposal by stockholders of business to be acted upon at an annual or
special meeting of stockholders.

                                       74
<PAGE>
 
     The articles of incorporation provide that a director may only be removed
for cause by the affirmative vote of at least 80% of the shares of the Company
entitled to vote generally in an election of directors cast at a meeting of
stockholders called for that purpose.

     Restrictions on Call of Special Meeting.  The articles of incorporation of
the Company provide that a special meeting of stockholders may be called only
pursuant to a resolution adopted by a majority of the board of directors, or a
committee of the board.  Stockholders may call a special meeting only if 25% of
the outstanding shares entitled to vote on the matter for which the meeting is
called.

     Absence of Cumulative Voting.  The Company's articles of incorporation
provides that stockholders may not cumulate their votes in the election of
directors.

     Authorized Shares. The articles of incorporation authorizes the issuance of
8,000,000 shares of common stock and 2,000,000 shares of preferred stock. The
shares of common stock and preferred stock were authorized in an amount greater
than that to be issued in the conversion to provide the Company's board of
directors with as much flexibility as possible to effect, among other
transactions, financings, acquisitions, stock dividends, stock splits and the
exercise of stock options. However, these additional authorized shares may also
be used by the board of directors consistent with its fiduciary duty to deter
future attempts to gain control of the Company. The board of directors also has
sole authority to determine the terms of any one or more series of preferred
stock, including voting rights, conversion rates, and liquidation preferences.
As a result of its ability to fix voting rights for a series of preferred stock,
the board has the power, to the extent consistent with its fiduciary duty, to
issue a series of preferred stock to persons friendly to management in order to
attempt to block a post-tender offer merger or other transaction by which a
third party seeks control of the Company and thereby assist management to retain
its position. The Company's board currently has no plans for the issuance of
additional shares, other than the possible issuance of additional shares
pursuant to stock benefit plans.

     Procedures for Certain Business Combinations.  The articles of
incorporation require the affirmative vote of at least 80% of the outstanding
shares of the Company in order for the Company to engage in or enter into
certain "Business Combinations," as defined therein, with any "Related Party"
(as defined below) or any affiliates of the "Related Party", unless the proposed
transaction has been approved in advance by a two-thirds vote of the Company's
board of directors, excluding those who were not directors prior to the time the
"Related Party" became the "Related Party."  Absent this provision, only the
approval of a majority of the shares outstanding would be required.

     The term "Related Party" is defined to include any person and the
affiliates and associates of the person (other than the Company or its
subsidiary) who beneficially owns, directly or indirectly, 10% or more of the
outstanding shares of voting stock of the Company. Any amendment to this
provision requires the affirmative vote of at least 80% of the shares of the
Company entitled to vote generally in an election of directors.

                                       75
<PAGE>
 
     Amendment to Articles of Incorporation and Bylaws.  Amendments to the
Company's articles of incorporation must be approved by the Company's board of
directors and also by a majority of the outstanding shares of the Company's
voting stock, provided, however, that approval by at least 80% of the
outstanding voting stock of the Company entitled to vote in the election of
directors is generally required for certain provisions (i.e., provisions
relating to restrictions on the acquisition and voting of greater than 10% of
the common stock; number, classification, election and removal of directors;
amendment of bylaws; call of special stockholder meetings; director liability;
certain business combinations; power of indemnification; and amendments to
provisions relating to the foregoing in the articles of incorporation).

     The bylaws may be amended by a majority vote of the board of directors or
the affirmative vote of the holders of at least 80% of the outstanding shares of
the Company entitled to vote in the election of directors cast at a meeting
called for that purpose.

Maryland General Corporation Law

     The Maryland General Corporation Law contains several provisions designed
to provide Maryland corporations with additional protections against hostile
takeovers.

     The Maryland Business Combination Statute restricts certain transactions
between a Maryland corporation and a holder, directly or indirectly, of 10% or
more of the corporation's outstanding voting stock (an "interested
stockholder").  For a period of five years following the date that a stockholder
becomes an interested stockholder, Maryland's Business Combination Statute
prohibits the following types of transactions between the corporation and the
interested stockholder (unless certain conditions, described below, are met):
(i) mergers or consolidations; (ii) sales, leases, exchanges or other
dispositions other than in the ordinary course of business or pursuant to a
dividend, in any twelve-month period, of assets having an aggregate book value
of 10% or more of the total market value of the outstanding stock of the
corporation or of its net worth; (iii) issuances or transfers by the corporation
or any subsidiary thereof of any equity securities of the corporation or any
subsidiary thereof having a market value of 5% or more of the total market value
of the outstanding stock of the corporation to any interested stockholder or
affiliate of any interested stockholder; (iv) the adoption of a proposal or plan
of liquidation or dissolution of the corporation in which anything other than
cash will be received by an interested stockholder or any affiliate of any
interested stockholder; (v) any reclassification of securities, or
recapitalization of the corporation, or any merger, consolidation, or share
exchange of the corporation with any of its subsidiaries which has the effect of
increasing by 5% or more of the total number of outstanding shares, the
proportionate amount of the outstanding shares of any class of equity securities
of the corporation or any subsidiary thereof which is owned by an interested
stockholder or any affiliate of an interested stockholder; and (vi) the receipt
by any interested stockholder or any affiliate thereof of the benefit, directly
or indirectly, (except proportionately as a stockholder) of any loan, advance,
guarantee, pledge, or other financial assistance or any tax credit or other tax
advantage provided by the corporation or any of its subsidiaries.  Additionally,
after the five-year prohibition on business combinations has expired, a business
combination must (i) be recommended by the board of 

                                       76
<PAGE>
 
directors and approved by (a) 80% of the votes entitled to be cast, and (b) two-
thirds of the votes cast by disinterested stockholders, or (ii) meet the
rigorous fair price requirements of the Statute, or (iii) qualify for one of the
statutory exemptions. This restriction does not apply if before such person
becomes an interested stockholder, the board of directors approves the
transaction in which the interested stockholder becomes an interested
stockholder or approves the business combination, or a statutory exemption
applies. A Maryland corporation may exempt itself from the requirements of the
statute in its articles of incorporation. However, our holding company has not
exempted itself from the provisions of this Statute.

     The Maryland Control Share Acquisition Statute prohibits a person who
acquires over specified limits of shares of our holding company (that is, 20%,
33 1/3 or 50% of its outstanding shares) from voting those shares in excess of
each specified limited unless two-thirds of our holding company's disinterested
stockholders vote to approve voting rights for the excess shares. A Maryland
corporation may include a provision in its articles of incorporation or bylaws
exempting the corporation from Maryland's Control Share Acquisition Statute.
Our holding company, however, has not exempted itself from the provisions of
Maryland's Control Share Acquisition Statute.

Benefit Plans

     In addition to the provisions of the Company's articles of incorporation
and bylaws described above, certain benefit plans of ours adopted in connection
with the conversion contain provisions which also may discourage hostile
takeover attempts which the boards of directors might conclude are not in the
best interests for us or our stockholders.  For a description of the benefit
plans and the provisions of such plans relating to changes in control, see
"Management of Northfield Federal Savings -- Proposed Future Stock Benefit
Plans."

Regulatory Restrictions

     For three years following conversion, OTS regulations prohibit any person,
without the prior approval of the OTS, from acquiring or making an offer to
acquire more than 10% of the stock of any converted savings institution if such
person is, or after consummation of such acquisition would be, the beneficial
owner of more than 10% of such stock.  In the event that any person, directly or
indirectly, violates this regulation, the securities beneficially owned by such
person in excess of 10% shall not be counted as shares entitled to vote and
shall not be voted by any person or counted as voting shares in connection with
any matter submitted to a vote of stockholders.

     Federal law provides that no company, "directly or indirectly or acting in
concert with one or more persons, or through one or more subsidiaries, or
through one or more transactions," may acquire "control" of a savings
association at any time without the prior approval of the OTS.  In addition, any
company that acquires such control becomes a "savings and loan holding company"
subject to registration, examination and regulation as a savings and loan
holding company.  Control in this context means ownership of, control of, or
holding proxies representing more than 25% of 

                                       77
<PAGE>
 
the voting shares of a savings association or the power to control in any manner
the election of a majority of the directors of such institution.

     Federal law also provides that no "person," acting directly or indirectly
or through or in concert with one or more other persons, may acquire control of
a savings association unless at least 60 days prior written notice has been
given to the OTS and the OTS has not objected to the proposed acquisition.
Control is defined for this purpose as the power, directly or indirectly, to
direct the management or policies of a savings association or to vote more than
25% of any class of voting securities of a savings association.  Under federal
law (as well as the regulations referred to below) the term "savings
association" includes state-chartered and federally chartered SAIF-insured
institutions, federally chartered savings and loans and savings banks whose
accounts are insured by the FDIC and holding companies thereof.

     Federal regulations require that, prior to obtaining control of an insured
institution, a person, other than a company, must give 60 days notice to the OTS
and have received no OTS objection to such acquisition of control, and a company
must apply for and receive OTS approval of the acquisition.  Control, involves a
25% voting stock test, control in any manner of the election of a majority of
the institution's directors, or a determination by the OTS that the acquiror has
the power to direct, or directly or indirectly to exercise a controlling
influence over, the management or policies of the institution.  Acquisition of
more than 10% of an institution's voting stock, if the acquiror also is subject
to any one of either "control factors," constitutes a rebuttable determination
of control under the regulations.  The determination of control may be rebutted
by submission to the OTS, prior to the acquisition of stock or the occurrence of
any other circumstances giving rise to such determination, of a statement
setting forth facts and circumstances which would support a finding that no
control relationship will exist and containing certain undertakings.  The
regulations provide that persons or companies which acquire beneficial ownership
exceeding 10% or more of any class of a savings association's stock after the
effective date of the regulations must file with the OTS a certification that
the holder is not in control of such institution, is not subject to a rebuttable
determination of control and will take no action which would result in a
determination or rebuttable determination of control without prior notice to or
approval of the OTS, as applicable.


                         DESCRIPTION OF CAPITAL STOCK

     The Company is authorized to issue 8,000,000 shares of the common stock,
$0.01 par value per share, and 2,000,000 shares of preferred stock, $0.01 par
value per share.  The Company currently expects to issue up to 595,125 shares of
common stock in the conversion.  The Company does not intend to issue any shares
of preferred stock in the conversion, nor are there any present plans to issue
such preferred stock following the conversion.  Each share of common stock will
have the same relative rights as, and will be identical in all respects with,
each other share of common stock.  THE COMMON STOCK OF THE COMPANY WILL
REPRESENT NONWITHDRAWABLE CAPITAL AND WILL NOT BE INSURED BY US, THE FDIC, OR
ANY OTHER GOVERNMENT AGENCY.

                                       78
<PAGE>
 
Common Stock

     Voting Rights.  Each share of the common stock will have the same relative
rights and will be identical in all respects with every other share of the
common stock.  The holders of the common stock will possess exclusive voting
rights in the Company, except to the extent that shares of Preferred Stock
issued in the future may have voting rights, if any.  Each holder of the common
stock will be entitled to only one vote for each share held of record on all
matters submitted to a vote of holders of the common stock and will not be
permitted to cumulate their votes in the election of the Company's directors.

     Liquidation.  In the unlikely event of the complete liquidation or
dissolution of the Company, the holders of the common stock will be entitled to
receive all assets of the Company available for distribution in cash or in kind,
after payment or provision for payment of (i) all debts and liabilities of the
Company (including all deposits with us and accrued interest thereon); (ii) any
accrued dividend claims; (iii) liquidation preferences of any Preferred Stock
which may be issued in the future; and (iv) any interests in the liquidation
account established upon the conversion for the benefit of Eligible Account
Holders and Supplemental Eligible Account Holders who continue to have their
deposits with us.

     Dividends. From time to time, dividends may be declared and paid to the
holders of the common stock, who will share equally in any such dividends. For
information about cash dividends, see "Dividends" and "Taxation."

     Restrictions on Acquisition of the Common Stock.  See "Restrictions on
Acquisition of the Company" for a discussion of the limitations on acquisition
of shares of the common stock.

     Other Characteristics. Holders of the common stock will not have preemptive
rights with respect to any additional shares of the common stock which may be
issued. Therefore, the board of directors may sell shares of capital stock of
the Company without first offering such shares to existing stockholders of the
Company. The common stock is not subject to call for redemption, and the
outstanding shares of common stock when issued and upon receipt by the Company
of the full purchase price therefor will be fully paid and non-assessable.

Serial Preferred Stock

     None of the 2,000,000 authorized shares of preferred stock of the Company
will be issued in the conversion.  After the conversion is completed, the board
of directors of the Company will be authorized to issue serial preferred stock
and to fix and state voting powers, designations, preferences or other special
rights of such shares and the qualifications, limitations and restrictions
thereof, subject to regulatory approval but without stockholder approval.  If
and when issued, the serial preferred stock is likely to rank prior to the
common stock as to dividend rights, liquidation preferences, or both, and may
have full or limited voting rights.  The board of directors, without stockholder
approval, can issue serial preferred stock with voting and conversion rights
which could adversely affect the voting power of the holders of the common
stock.  The board of directors has no present intention to issue any of the
serial preferred stock.

                                       79
<PAGE>
 
                             LEGAL AND TAX MATTERS

     The legality of the common stock has been passed upon for us by Housley
Kantarian & Bronstein, P.C., Washington, D.C.   Certain legal matters for
Trident Securities may be passed upon by Thacher Proffitt & Wood, Washington,
D.C. The federal income tax consequences of the conversion have been passed upon
for us by Housley Kantarian & Bronstein, P.C., Washington, D.C. The Maryland
income tax consequences of the conversion have been passed upon for us by
Anderson Associates, LLP.

                                    EXPERTS

     The financial statements of Northfield Federal Savings as of December 31,
1997 and 1996, and for the years then ended, have been included herein in
reliance upon the report of Anderson Associates, LLP, independent certified
public accountants, appearing elsewhere herein, and upon authority of said firm
as experts in accounting and auditing.

     Ferguson has consented to the publication herein of a summary of its
letters to us setting forth its opinion as to the estimated pro forma market
value of us in the converted form and its opinion setting forth the value of
subscription rights and to the use of its name and statements with respect to it
appearing in this document.

                            ADDITIONAL INFORMATION

     The Company has filed with the SEC a registration statement on Form SB-2
under the Securities Act of 1933, as amended, with respect to the common stock
offered in this document.  As permitted by the rules and regulations of the SEC,
this document does not contain all the information set forth in the registration
statement.  Such information can be examined without charge at the public
reference facilities of the SEC located at 450 Fifth Street, N.W., Washington,
D.C. 20549, and copies of such material can be obtained from the SEC at
prescribed rates.  The SEC also maintains an internet address ("Web site") that
contains reports, proxy and information statements and other information
regarding registrants, including the Company, that file electronically with the
SEC.  The address for this Web site is "http: //www. sec. gov." The
statements contained in this document as to the contents of any contract or
other document filed as an exhibit to the Form SB-2 describe the material
features of such contract or document but are, of necessity, brief descriptions
and are not necessarily complete; each such statement is qualified by reference
to such contract or document.

     Northfield Federal Savings has filed an Application for Conversion with the
OTS with respect to the conversion.  Pursuant to the rules and regulations of
the OTS, this document omits certain information contained in that Application.
The Application may be examined at the principal office of the OTS, 1700 G
Street, N.W., Washington, D.C. 20552 and at the Southeast  Regional Office of
the OTS, 1475 Peachtree Street, N.E., Atlanta, Georgia 30309 without charge.
 
     A copy of the articles of incorporation and the bylaws of the Company are
available without charge from Northfield Federal Savings.

                                       80
<PAGE>
 
                          NORTHFIELD FEDERAL SAVINGS

                         INDEX TO FINANCIAL STATEMENTS

 
                                                                            Page
                                                                            ----

Independent Auditor's Report                                                 F-1
 
Statements of Financial Condition as of December 31, 1997 and 1996           F-2
 
Statements of Operations for the Years Ended December 31, 1997 and 1996      F-3
 
Statements of Retained Earnings for the Years Ended December 31, 1997 and
 1996                                                                        F-4
 
Statements of Cash Flows for the Years Ended December 31, 1997 and 1996      F-5
 
Notes to Financial Statements                                                F-7
 

All schedules are omitted because the required information is either not
applicable or is included in the financial statements or related notes.

Separate financial statements for the Company have not been included since it
will not engage in material transactions until after the conversion.  The
Company, which has been inactive to date, has no significant assets,
liabilities, revenues, expenses or contingent liabilities.

                                       81
<PAGE>
 
                   [LETTERHEAD OF ANDERSON ASSOCIATES, LLP]


                          INDEPENDENT AUDITOR'S REPORT
                          ----------------------------


Board of Directors
Northfield Federal Savings
Baltimore, Maryland

    We have audited the statements of financial condition of Northfield Federal
Savings as of December 31, 1997 and 1996, and the related statements of
operations, retained earnings and cash flows for each of the two years in the
two year period ended December 31, 1997.  These financial statements are the
responsibility of the Association's management.  Our responsibility is to
express an opinion on these financial statements based on our audits.

    We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

    In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Northfield Federal Savings
as of December 31, 1997 and 1996, and the results of its operations and cash
flows for each of the two years in the two year period ended December 31, 1997
in conformity with generally accepted accounting principles.


                                                  /s/ Anderson Associates, LLP

February 12, 1998
Baltimore, Maryland

                                      F-1
<PAGE>
 
                           NORTHFIELD FEDERAL SAVINGS
                           --------------------------
                              Baltimore, Maryland
                              -------------------

                       STATEMENTS OF FINANCIAL CONDITION
                       ---------------------------------

<TABLE>
<CAPTION>
                                                               December 31,
                                                               ------------
                                                            1997          1996
                                                            ----          ----    
<S>                                                      <C>          <C>
   Assets
   ------
Cash                                                     $   116,900  $   172,850
Interest bearing deposits in other banks                   3,513,650    5,186,074
Securities available for sale (Note 2)                             -      196,772
Mortgage backed securities (Note 3)                        1,955,008    2,333,119
Loans receivable, net (note 4)                            29,961,032   23,841,394
Accrued interest receivable - loans                          149,536      127,180
                            - investments                     25,000       41,157
                            - mortgage backed  
                               securities                     12,693       15,194
Premises and equipment, at cost, less
 accumulated depreciation (Note 5)                            40,374       52,301
Federal Home Loan Bank of Atlanta stock
 at cost (Note 6)                                            226,400      226,400
Deferred income taxes (Note 10)                               26,279            -
Prepaid income taxes (Note 10)                                     -          782
Prepaid expenses and other assets                             57,544       34,846
                                                         -----------  -----------
 
Total assets                                             $36,084,416  $32,228,069
                                                         ===========  ===========
 
   Liabilities and Retained Earnings
   ---------------------------------
 
Liabilities
- -----------
  Deposit accounts (Note 7)                              $32,621,766  $29,115,850
  Advance payments by borrowers for expenses                 371,262      316,973
  Deferred income taxes (Note 10)                                  -       57,612
  Income taxes payable (Note 10)                              62,964        2,600
  Other liabilities                                          134,667        5,329
                                                         -----------  -----------
Total liabilities                                         33,190,659   29,498,364
 
Commitments and contingencies - Notes 4 and 5
 
Retained earnings (substantially restricted) (Note 9)      2,893,757    2,749,226
Net unrealized loss on investment securities
 net of tax                                                        -      (19,521)
                                                         -----------  -----------
Total retained earnings                                    2,893,757    2,729,705
                                                         -----------  -----------
 
Total liabilities and retained earnings                  $36,084,416  $32,228,069
                                                         ===========  ===========
</TABLE>


The accompanying notes to financial statements
 are an integral part of these statements.

                                      F-2
<PAGE>
 
                           NORTHFIELD FEDERAL SAVINGS
                           --------------------------
                              Baltimore, Maryland
                              -------------------

                            STATEMENTS OF OPERATIONS
                            ------------------------
<TABLE>
<CAPTION>
                                                         Years Ended
                                                         December 31,
                                                         ------------      
                                                       1997         1996
                                                       ----         ----   
<S>                                                 <C>          <C>
Income
- ------
   Interest and fees on loans (Note 4)              $2,209,375   $1,927,726
   Interest on securities available for sale            14,888       15,216
   Interest on mortgage backed securities              166,235      161,432
   Other interest income                               235,958      352,631
                                                    ----------   ----------
Total interest income                                2,626,456    2,457,005
 
Interest Expense
- ----------------
   Interest on deposits (Note 7)                     1,473,588    1,394,152
   Interest on short-term borrowings                    19,973        2,556
                                                    ----------   ----------
Total interest expense                               1,493,561    1,396,708
                                                    ----------   ----------
 
Net interest income                                  1,132,895    1,060,297
 
Provision for losses on loans (Note 4)                 123,270       10,000
                                                    ----------   ----------
Net interest income after provision
 for losses on loans                                 1,009,625    1,050,297
 
Non-Interest Income (Loss)
- --------------------------
   Loss on sale of securities available for sale       (32,321)           -
   Fees on loans                                         8,366        7,101
   Fees on deposits                                     14,033       18,978
   All other income                                      7,504        5,359
                                                    ----------   ----------
Net non-interest income (loss)                          (2,418)      31,438
 
Non-Interest Expenses
- ---------------------
   Compensation and related expenses                   469,637      328,285
   Occupancy                                            63,201       59,397
   Deposit insurance                                    15,238      250,195
   Service bureau expense                               56,637       55,651
   Furniture, fixtures and equipment expense            28,075       31,673
   Advertising                                          30,013       22,412
   Other                                               108,702       95,662
                                                    ----------   ----------
Total non-interest expenses                            771,503      843,275
                                                    ----------   ----------
 
Income before tax provision                            235,704      238,460
 
Provision for income tax (Note 10)                      91,173       89,581
                                                    ----------   ----------
 
Net income                                          $  144,531   $  148,879
                                                    ==========   ==========
</TABLE>


The accompanying notes to financial statements
 are an integral part of these statements.

                                      F-3
<PAGE>
 
                           NORTHFIELD FEDERAL SAVINGS
                           --------------------------
                              Baltimore, Maryland
                              -------------------

                        STATEMENTS OF RETAINED EARNINGS
                        -------------------------------
            FOR YEARS ENDED DECEMBER 31, 1997 AND DECEMBER 31, 1996
            -------------------------------------------------------

<TABLE> 
<CAPTION> 
                                                               Net Unrealized                
                                                               Loss on Investment            
                                           Retained            Securities Net                
                                           Earnings                of Tax                   Total 
                                           --------           ------------------            ----- 
<S>                                       <C>                 <C>                        <C> 
Balance - December 31, 1995                $2,600,347               $(13,946)            $2,586,401   
                                                                             
Net change in unrealized loss on                    -                 (5,575)                (5,575)   
 investment securities                                                                               
                                                                                                     
Net income for year ended                  
 December 31, 1996                            148,879                      -                148,879   
                                           ----------               --------             ----------   
                                                                                                      
Balance - December 31, 1996                 2,749,226                (19,521)             2,729,705   
                                                                                                      
Net change in unrealized loss on                                                                      
 investment securities                              -                 19,521                 19,521   
                                                                                                      
Net income for year ended                                                                             
 December 31, 1997                            144,531                      -                144,531   
                                           ----------               --------             ----------   
                                                                                                      
Balance - December 31, 1997                $2,893,757                   $  -             $2,893,757   
                                           ==========               ========             ==========    
</TABLE>

The accompanying notes to financial statements
 are an integral part of these statements.

                                      F-4
<PAGE>
 
                           NORTHFIELD FEDERAL SAVINGS
                           --------------------------
                              Baltimore, Maryland
                              -------------------

                            STATEMENTS OF CASH FLOWS
                            ------------------------

<TABLE>
<CAPTION>
                                                          Years Ended December 31,
                                                         ---------------------------
                                                             1997           1996
                                                             ----           ----   
<S>                                                      <C>            <C>    
Operating Activities
- --------------------
  Net income                                             $    144,531   $   148,879
  Adjustments to Reconcile Net Income to
   Net Cash Provided by Operating Activities
   -----------------------------------------
    Net amortization of premiums and accretion of
     discounts on certificates of deposit                       7,358        11,111
    Stock dividends on investments                            (14,637)      (15,216)
    Loss on sale of securities available for sale              32,321             -
    Net amortization of premiums and accretion of
     discounts on mortgage backed securities                    2,244         2,272
    Loan fees deferred                                         77,225        59,520
    Amortization of deferred loan fees                        (27,831)      (42,971)
    Provision for losses on loans                             123,270        10,000
    (Increase) decrease in accrued interest on loans          (22,356)       18,863
    Decrease in accrued interest on investments                16,157        16,924
    Decrease in accrued interest on mortgage
     backed securities                                          2,501         4,785
    Provision for depreciation                                 18,049        23,299
    Increase in deferred income taxes                         (96,173)      (24,888)
    Decrease in prepaid income taxes                              782        75,664
    (Increase) decrease in prepaid expenses and
     other assets                                             (22,698)       12,426
    Increase (decrease) in accrued interest payable             1,615        (8,351)
    Increase in income taxes payable                           60,364         2,600
    Increase (decrease) in other liabilities                  129,338       (25,974)
                                                         ------------   -----------
       Net cash provided by operating activities              432,060       268,943
 
Cash Flows from Investing Activities
- ------------------------------------
  Proceeds from maturing certificates of deposit              970,154       755,037
  Purchases of certificates of deposit                       (150,000)            -
  Proceeds from sale of securities available for sale         210,891             -
  Purchases of mortgage backed securities                           -      (499,063)
  Principal collected on mortgage backed securities           375,867       317,970
  Longer term loans originated                            (10,580,784)   (6,493,718)
  Principal collected on longer term loans                  4,012,325     3,412,231
  Net decrease in short-term loans                            276,157       908,611
  Purchases of premises and equipment                          (6,122)       (9,552)
                                                         ------------   -----------
       Net cash used by investing activities               (4,891,512)   (1,608,484)
</TABLE>

                                      F-5
<PAGE>
 
                           NORTHFIELD FEDERAL SAVINGS
                           --------------------------
                              Baltimore, Maryland
                              -------------------

                            STATEMENTS OF CASH FLOWS
                            ------------------------

<TABLE>
<CAPTION>
                                                         Years Ended December 31,
                                                         ------------------------
                                                          1997              1996       
                                                          ----              ----       
<S>                                                     <C>              <C>           
Cash Flows from Financing Activities                                                   
- ------------------------------------                                                   
  Net decrease in demand deposits, money market,                                       
   passbook accounts and advance payments by                                           
   borrowers for taxes and insurance                     $ (171,777)     $  (525,232)  
  Net increase in certificates of deposit                 3,730,367          518,741   
                                                         ----------      -----------   
       Net cash provided (used) by financing                                           
        activities                                        3,558,590           (6,491)  
                                                         ----------      -----------   
                                                                                       
Decrease in cash and cash equivalents                      (900,862)      (1,346,032)  
Cash and cash equivalents at beginning of year            3,645,304        4,991,336   
                                                         ----------      -----------   
Cash and cash equivalents at end of year                 $2,744,442      $ 3,645,304   
                                                         ==========      ===========   
                                                                                       
Reconciliation of cash and cash equivalents:                                           
  Cash                                                   $  116,900      $   172,850   
  Interest bearing accounts in other banks                3,513,650        5,186,074   
                                                         ----------      -----------   
                                                          3,630,550        5,358,924   
                                                                                       
    Less - Certificates of deposit maturing in                                         
            90 days or more included in interest                                       
            bearing accounts in other banks                (886,108)      (1,713,620)  
                                                         ----------                    
                                                                                       
Cash and cash equivalents                                $2,744,442      $ 3,645,304   
                                                         ==========      ===========   
                                                                                       
Supplemental disclosures of cash flows information:                                    
  Cash paid during year for:                                                           
    Interest                                             $1,491,949      $ 1,405,078   
    Income taxes                                         $  126,200      $    68,193    
</TABLE>

The accompanying notes to financial statements
 are an integral part of these statements.

                                      F-6
<PAGE>
 
                          NORTHFIELD FEDERAL SAVINGS
                          --------------------------
                              Baltimore, Maryland
                              -------------------

                         NOTES TO FINANCIAL STATEMENTS
                         -----------------------------


Note 1 - Summary of Significant Accounting Policies
         ------------------------------------------

         Business
         --------

            The Association's primary business activity is the acceptance of
         deposits from the general public in its market area and using the
         proceeds for investments and loan originations. The Association is
         subject to competition from other financial institutions. The
         Association is subject to the regulations of certain federal agencies
         and undergoes periodic examinations by those regulatory authorities.

         Basis of Financial Statement Presentation
         -----------------------------------------

            The financial statements have been prepared in conformity with
         generally accepted accounting principles. In preparing the financial
         statements, management is required to make estimates and assumptions
         that affect the reported amounts of assets and liabilities as of the
         date of the statement of financial condition and revenues and expenses
         for the period. Actual results could differ significantly from those
         estimates. Material estimates that are particularly susceptible to
         significant change in the near-term relate to the determination of the
         allowance for loan losses. See the discussion below of the
         determination of that estimate.

         Securities Available for Sale
         -----------------------------

            Securities available for sale consisted of certain equity
         securities. Unrealized holding gains and losses, net of tax, on
         securities available for sale are reported as a net amount. Gains and
         losses on the sale of securities available for sale are determined
         using the specific identification method.

         Mortgage Backed Securities
         --------------------------

            Mortgage backed securities, including real estate mortgage
         investment conduits ("REMICs"), are stated at cost, adjusted for
         amortization of premium or discount on purchase, since management has
         the intention and ability to hold them to maturity. Amortization is
         computed using a method which approximates level yield over the life of
         the security. Gains and losses on the sale of investments and mortgage
         backed securities are determined using the specific identification
         method. See Note 3 for discussion of prepayment risk and recoverability
         of mortgage backed securities.

                                      F-7
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 1 - Summary of Significant Accounting Policies - Continued
         ------------------------------------------            

         Loans Receivable
         ----------------

            Loans receivable that management has the intent and ability to hold
         for the foreseeable future or until maturity or pay-off are reported at
         their outstanding principal balance adjusted for any charge-offs, the
         allowance for loan losses, and any deferred fees or costs on originated
         loans.

            Loan origination fees and certain direct origination costs are
         capitalized and recognized as an adjustment of the yield of the related
         loan.

            An allowance for loan losses is provided through charges to income
         in an amount that management believes will be adequate to absorb losses
         on existing loans that may become uncollectible, based on evaluations
         of the collectibility of loans and prior loan loss experience. The
         evaluations take into consideration such factors as changes in the
         nature and volume of the loan portfolio, overall portfolio quality,
         review of specific problem loans, and current economic conditions that
         may affect the borrowers' ability to pay. Determining the amount of the
         allowance for loan losses requires the use of estimates and
         assumptions. Management believes the allowance for losses on loans is
         adequate. While management uses available information to estimate
         losses on loans, future additions to the allowances may be necessary
         based on changes in economic conditions, particularly in the State of
         Maryland. In addition, various regulatory agencies, as an integral part
         of their examination process, periodically review the Association's
         allowances for losses on loans. Such agencies may require the
         Association to recognize additions to the allowances based on their
         judgments about information available to them at the time of their
         examination. Statement of Financial Accounting Standards ("SFAS") No.
         114, as amended by SFAS No. 118 addresses the accounting by creditors
         for impairment of certain loans. It is generally applicable for all
         loans except large groups of smaller balance homogeneous loans that are
         collectively evaluated for impairment, including residential mortgage
         loans and consumer installment loans. It also applies to all loans that
         are restructured in a troubled debt restructuring involving a
         modification of terms. SFAS No. 114 requires that impaired loans be
         measured based on the present value of expected future cash flows
         discounted at the loan's effective interest rate, or at the loan's
         observable market price or the fair value of the collateral if the loan
         is collateral dependent. A loan is considered impaired when, based on
         current information and events, it is probable that a creditor will be
         unable to collect all amounts due according to the contractual terms of
         the loan agreement.

            Accrual of interest is discontinued on a loan when management
         believes, after considering economic and business conditions and
         collection efforts, that the borrower's financial condition is such
         that collection of interest is doubtful. When a payment is received on
         a loan on non-accrual status, the amount received is allocated to
         principal and interest in accordance with the contractual terms of the
         loan.

                                      F-8
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 1 - Summary of Significant Accounting Policies - Continued
         ------------------------------------------            

         Premises and Equipment
         ----------------------

            Land is carried at cost, premises and equipment are carried at cost
         less accumulated depreciation. Depreciation is computed on the 
         straight-line method, based on the useful lives of the respective
         assets.

         Income Taxes
         ------------

            Deferred income taxes are recognized for temporary differences
         between the financial reporting basis and income tax basis of assets
         and liabilities based on enacted tax rates expected to be in effect
         when such amounts are realized or settled. Deferred tax assets are
         recognized only to the extent that it is more likely than not that such
         amounts will be realized based on consideration of available evidence.
         The effect on deferred tax assets and liabilities of a change in tax
         rates is recognized in income in the period that includes the enactment
         date.

          Statement of Cash Flows
          -----------------------

            In the statement of cash flows, cash and equivalents include cash
         and interest bearing deposits in other banks with a maturity date of
         less than ninety days.

         Reclassification
         ----------------

            Certain prior year's amounts have been reclassified to conform to
         the current year's presentation.

Note 2 - Securities Available for Sale
         -----------------------------

            The Association had no securities available for sale at December 31,
         1997. At December 31, 1996, the securities available for sale consisted
         of the Association's investment in Lord Abbett U.S. Government
         Securities Fund at a cost of $228,575, a gross unrealized loss of
         $31,803 and fair value of $196,772.

            The Association recognized a loss of $32,321 during the year ended
         December 31, 1997 due to the full redemption of securities in the Lord
         Abbett U.S. Government Securities Fund. No gains or losses were
         realized during the year ended December 31, 1996.

                                      F-9
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 3 - Mortgage Backed Securities
         --------------------------

            Mortgage backed securities at December 31, 1997 and 1996 consist of
         the following:

<TABLE>
<CAPTION>
                                                         1997         1996   
                                                      -----------  -----------
         <S>                                          <C>          <C>       
         GNMA participating certificates              $  815,950   $1,018,329
         FNMA participating certificates                  46,305       50,525
         FHLMC participating certificates                701,770      766,108
         REMIC                                           395,071      500,000
                                                      ----------   ----------
                                                       1,959,096    2,334,962
          Net - unamortized premiums and discounts        (4,088)      (1,843)
                                                      ----------   ----------
                                                      $1,955,008   $2,333,119
                                                      ==========   ==========
</TABLE>

            The amortized cost and fair value of mortgage backed securities are
         as follows as of December 31, 1997 and 1996, respectively.

<TABLE>
<CAPTION>
                                      Gross          Gross                               
                                    Amortized      Unrealized     Unrealized                 
                                       Cost          Gains          Losses       Fair Value  
                                    ----------     ----------     ----------     ----------  
                                                                                             
                                                       December 31, 1997                     
                                    -------------------------------------------------------                                
<S>                                 <C>               <C>         <C>            <C>         
GNMA participating certificates     $  812,201        $49,580     $        -     $  861,781  
FNMA participating certificates         46,305          1,048              -         47,353  
FHLMC participating certificates       701,431          4,941          2,748        703,624  
REMIC                                  395,071          3,105              -        398,176  
                                    ----------        -------     ----------     ----------  
                                    $1,955,008        $58,674        $ 2,748     $2,010,934  
                                    ==========        =======     ==========     ==========  
</TABLE> 
                                        
<TABLE> 
<CAPTION> 
                                                       December 31, 1996                     
                                    -------------------------------------------------------                             
<S>                                 <C>               <C>         <C>            <C>         
GNMA participating certificates     $1,014,748        $49,024     $        -     $1,063,772  
FNMA participating certificates         50,525          1,957              -         52,482  
FHLMC participating certificates       767,846          1,302         12,571        756,577  
REMIC                                  500,000          5,425              -        505,425  
                                    ----------        -------     ----------     ----------  
                                    $2,333,119        $57,708        $12,571     $2,378,256  
                                    ==========        =======     ==========     ==========   
</TABLE>

            No gains or losses were realized during the years ended December 31,
         1997 and 1996.

            Certain mortgage backed securities including REMICs are subject to
         significant prepayments risks. In periods of declining interest rates
         mortgages may be repaid more rapidly than anticipated resulting in
         greater amortization of premiums and reduced yields. In addition, the
         Association may be unable to reinvest at an interest rate comparable to
         the rate on the prepaying mortgage backed security. In contrast, in
         periods of increasing interest rates, market values of mortgage backed
         securities, including

                                      F-10
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 3 - Mortgage Backed Securities - Continued
         --------------------------            

         REMICs, will decline. Since principal payments on REMICs do not
         commence upon purchase of the investment, REMICs are more susceptible
         to market value fluctuations. Cash flows from the REMICs include
         interest only for one or more years and principal and interest payments
         thereafter provided by mortgage backed securities guaranteed by FHLMC
         or GNMA and backed by residential mortgages. All interest payments on
         the Association's REMICs are at fixed rates. Management anticipates
         full recoverability to the principal balance of REMICs.

Note 4 - Loans Receivable
         ----------------

            Loans receivable at December 31, 1997 and 1996 consist of the
         following:

<TABLE>
<CAPTION>
                                                           1997          1996   
                                                       ------------  ------------
         <S>                                           <C>           <C>        
         One to four family residential mortgage                                
          loans                                        $25,739,458   $19,439,391
         Construction loans                              2,104,575     2,461,800
         Commercial real estate loans                    2,805,693     2,195,236
         Commercial loan collateralized by lease                                
          finance receivables                              741,226     1,017,913
         Home equity line of credit loans                  177,141             -
         Loans secured by deposits                          74,142        73,612
                                                       -----------   -----------
                                                        31,642,235    25,187,952
                                                                                
         Less                                                                   
         ----
            Undisbursed portion of loans in process     (1,197,270)   (1,027,520)
            Deferred loan origination fees                (268,433)     (219,038)
            Allowance for losses on loans                 (215,500)     (100,000)
                                                       -----------   -----------
                                                        (1,681,203)   (1,346,558)
                                                       -----------   -----------
                                                       $29,961,032   $23,841,394
                                                       ===========   =========== 
</TABLE>

            Residential lending is generally considered to involve less risk
         than other forms of lending, although payment experience on these loans
         is dependent to some extent on economic and market conditions in the
         Association's lending area. Commercial and construction loan repayments
         are generally dependent on the operations of the related properties or
         the financial condition of its borrower or guarantor. Accordingly,
         repayment of such loans can be more susceptible to adverse conditions
         in the real estate market and the regional economy.

            A substantial portion of the Association's loans receivable are
         mortgage loans secured by residential and commercial real estate
         properties located in the state of Maryland. Loans are extended only
         after evaluation by management of customers' creditworthiness and other
         relevant factors on a case-by-case basis. The Association generally
         does not lend more than 90% of the appraised value of a property and
         requires private mortgage insurance on residential mortgages with loan-
         to-value ratios in excess of 80%. In addition, the Association
         generally obtains personal guarantees of repayment from borrowers

                                      F-11
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 4 - Loans Receivable - Continued
         ----------------            

         and/or others for construction, commercial and multifamily residential
         loans and disburses the proceeds of construction and similar loans only
         as work progresses on the related projects.

            The commercial loan collateralized by lease finance receivables
         represents a loan to a leasing company collateralized by leases
         receivable to individuals and businesses secured by personal property
         and is primarily dependent upon the financial condition of the borrower
         and lessors for repayment.

            The following is a summary of the allowance for loan losses for the
         years ended December 31:

<TABLE>
         <S>                                                          <C>      
         Balance at December 31, 1995                                 $ 90,000 
         Provision for losses on loans                                  10,000 
                                                                      -------- 
         Balance at December 31, 1996                                  100,000 
         Provision for losses on loans                                 123,270 
         Charge-offs                                                    (7,770)
                                                                      -------- 
         Balance at December 31, 1997                                 $215,500 
                                                                      ========  
</TABLE>

            A loan is considered impaired when it is probable that the
         Association will be unable to collect all amounts due according to the
         contractual terms of the loan agreement. Impaired loans are summarized
         as follows for the years ended December 31:


<TABLE>
<CAPTION>
                                                           1997         1996    
                                                         --------     --------  
         <S>                                             <C>          <C>       
         Aggregate recorded investment                   $135,000     $270,000  
         Allowance for loan losses                          1,350        2,700  
         Interest income recognized during                                      
          impairment                                        9,442       21,513
</TABLE>

            The Association was not committed to advance any additional amounts
         on the above loans at December 31, 1997.

            The Association had no non-accrual loans that were not subject to
         SFAS No. 114.

            The following table presents a summary of the activity with respect
         to loans to directors and officers for the years ended December 31,
         1997 and 1996, respectively.

<TABLE>
<CAPTION>
                                                         1997           1996    
                                                       ---------      --------- 
         <S>                                           <C>            <C>       
         Balance outstanding - beginning of year       $498,213       $535,925  
         New loans                                      153,900              -  
         Principal repayments                           (34,161)       (37,712) 
                                                       --------       --------  
         Balance outstanding - end of year             $617,952       $498,213  
                                                       ========       ========
</TABLE>

                                      F-12
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 4 - Loans Receivable - Continued
         ----------------            

            The Association is a party to financial instruments with 
         off-balance-sheet risk in the normal course of business to meet the
         financial needs of its customers. Mortgage loan commitments, exclusive
         of loans in process not reflected in the accompanying statements at
         December 31, 1997, approximate $394,800. These commitments are for
         mortgage loans with fixed rates between 7.125% and 11.50% at December
         31, 1997. Non-recourse leasing loan commitments not reflected in the
         accompanying statements at December 31, 1997 are approximately $64,000
         with fixed rates between 10.00% and 10.50%.

            The credit risk involved in these financial instruments is
         essentially the same as that involved in extending loan facilities to
         customers. No amount has been recognized in the statement of financial
         condition at December 31, 1997, as a liability for credit loss.

Note 5 - Premises and Equipment
         ----------------------

            Premises and equipment at December 31, 1997 and 1996 are as follows:

<TABLE>
<CAPTION>
                                                 1997        1996     Useful Lives 
                                              ----------  ----------  -------------
         <S>                                  <C>         <C>         <C>         
         Land                                 $  15,000   $  15,000               -
         Office building and improvements        49,497      49,497   5 to 35 years
         Furniture, fixtures and equipment      228,757     222,635   5 to 15 years
                                              ---------   ---------               
                                                293,254     287,132                           
          Less - accumulated depreciation      (252,880)   (234,831)              
                                              ---------   --------- 
                                               $ 40,374   $  52,301                           
                                              =========   =========
</TABLE>

            The Association has entered into a long-term lease for the premises
         of its main office. Rental expense under the lease for the property for
         the years ended December 31, 1997 and 1996 was $39,500 and $34,167,
         respectively. At December 31, 1997, the minimum rental commitments
         under noncancellable operating leases are as follows:

<TABLE>
<CAPTION>
            Year Ended December 31,
            -----------------------
            <S>                            <C>
                    1998                   $ 40,333  
                    1999                     42,000
                    2000                     42,000
                    2001                     42,000
                    2002                     42,000
                    2003                     28,000
                                           --------
                                           $236,333 
                                           ========
</TABLE>

                                      F-13
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 6- Investment in Federal Home Loan Bank of Atlanta Stock
        -----------------------------------------------------

            The Association is required to maintain an investment in the stock
         of the Federal Home Loan Bank of Atlanta ("FHLB") in an amount equal to
         at least 1% of the unpaid principal balances of the Association's
         residential mortgage loans or 1/20 of its outstanding advances from the
         FHLB, whichever is greater. Purchases and sales of stock are made
         directly with the FHLB at par value.

Note 7 - Deposit Accounts
         ----------------

            Deposit accounts at December 31, 1997 and 1996 consist of the
         following:

<TABLE>
<CAPTION>
                                                                   1997                   1996                            
                                                           ------------------     ------------------
                                                               Amount      %          Amount      %                       
                                                             ---------     -        ---------     -                       
         <S>                                               <C>          <C>       <C>          <C>                        
         Demand and NOW accounts including                                                                                
          non-interest bearing deposits of                                                                                
          $338,633 in 1997 and $277,778                                                                                   
          in 1996                                          $ 2,078,419     6.37%  $ 2,123,746    7.29%                    
         Money markets                                       7,816,045    23.96     7,973,913   27.39                     
         Passbook savings                                    2,604,543     7.99     2,627,415    9.03                     
         Certificates of deposit                            20,108,422    61.64    16,378,055   56.25                     
                                                           -----------  -------   -----------  ------                     
                                                            32,607,429    99.06    29,103,129   99.06                     
         Accrued interest on deposits                           14,337      .04        12,721     .04                     
                                                           -----------  -------   -----------  ------                     
                                                           $32,621,766   100.00%  $29,115,850  100.00%                    
                                                           ===========  =======   ===========  ======                     
</TABLE> 

            Certificates of deposit mature as follows at December 31:
 
<TABLE> 
               <S>                           <C> 
               1998                          $ 7,763,351
               1999                            5,782,167
               2000                            3,515,330
               2001                            1,618,777
               2002                            1,195,899
               2003                              232,898 
                                             -----------
               Total                         $20,108,422
                                             ===========
</TABLE> 

            Interest expense on deposits is summarized as follows for the year
         ended December 31:

<TABLE> 
<CAPTION> 
                                                   1997                1996                                            
                                                   ----                ----  
         <S>                                   <C>                  <C> 
         NOW accounts                          $    50,263          $    44,959
         Money markets                             302,996              289,428
         Savings                                    76,881               80,670
         Certificates of deposit                 1,043,448              979,095
                                               -----------           ----------
                                               $ 1,473,588          $ 1,394,152                               
                                               ===========           ==========
</TABLE>

                                      F-14
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 7 - Deposit Accounts - Continued
         ----------------            

               The Association had deposits of $100,000 or more of approximately
         $1,456,188 and $2,281,290 at December 31, 1997 and 1996, respectively.

               Deposit Insurance Reform. Currently, there are two deposit
         insurance funds maintained by the Federal Deposit Insurance Corporation
         ("FDIC"), the Bank Insurance Fund ("BIF") and the Savings Association
         Insurance Fund ("SAIF"). The Association's deposits are insured by
         SAIF. Legislation has been passed concerning the Deposit Insurance
         Reform that required the Association to pay a one-time assessment of
         .657% of insured deposits at March 31, 1995, which was approximately
         $181,500. The Association's SAIF deposit insurance premiums have been
         reduced to .064% of insured deposits beginning January 1, 1997 from the
         rate of .23% of insured deposits. BIF and SAIF may be merged on January
         1, 1999.

Note 8 - Employee Benefit Plan and Deferred Compensation
         -----------------------------------------------

               The Association has a 401(k) Plan which requires, under certain
         conditions, a contribution of up to 5% of eligible employees' total
         compensation. The total expense related to this Plan for the year ended
         December 31, 1997 and 1996 was $23,769 and $23,483, respectively.

               During the year ended December 31, 1997, the Association entered
         into a Deferred Compensation Agreement with all of the current
         directors. The Association recorded an expense during the year ended
         December 31, 1997 of $115,000 and additional liability under this
         Agreement is being accrued by charges to operating expense during the
         term of employment.

Note 9 - Retained Earnings
         -----------------

               The Association is subject to various regulatory capital
         requirements administered by the federal banking agencies. Failure to
         meet minimum capital requirements can initiate certain mandatory and
         possibly additional discretionary actions by regulators that, if
         undertaken, could have a direct material effect on the Association's
         financial statements. Under capital adequacy guidelines and the
         regulatory framework for prompt corrective action, the Association must
         meet specific capital guidelines that involve quantitative measures of
         the Association's assets, liabilities, and certain off-balance-sheet
         items as calculated under regulatory accounting practices. The
         Association's capital amounts and classification are also subject to
         qualitative judgments by the regulators about components, risk
         weightings, and other factors.

                                     F-15
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 9 - Retained Earnings - Continued
         -----------------            

               Quantitative measures established by regulation to ensure capital
         adequacy require the Association to maintain minimum amounts and ratios
         (set forth in the table below) of total and Tier I capital (as defined
         in the regulations) to risk-weighted assets (as defined), and of Tier I
         capital (as defined) to average assets (as defined). Management
         believes, as of December 31, 1997, that the Association meets all
         capital adequacy requirements to which it is subject.

               As of December 31, 1997, the most recent notification from the
         Federal Deposit Insurance Corporation has categorized the Association
         as well capitalized under the regulatory framework for prompt
         corrective action. To be categorized as well capitalized the
         Association must maintain minimum total risk-based, Tier I risk-based
         and Tier I leverage ratios at least 100 to 200 basis points above those
         ratios set forth in the table. There have been no conditions or events
         since that notification that management believes have changed the
         Association's category.

               The following table presents the Association's capital position
         based on the December 31, 1997 financial statements. 

<TABLE>
<CAPTION>
                                                                             To Be Well
                                                                           Capitalized Under
                                                     For Capital             Prompt Corrective
                                Actual             Adequacy Purposes         Action Provisions
                         --------------------    ---------------------    -----------------------
                           Amount        %            Amount      %            Amount        %
                           ------       ---           ------     ---           -------      ---
<S>                      <C>           <C>       <C>             <C>      <C>               <C>
Tangible (1)             $2,893,757     8.02%      $  541,266    1.50%        $   N/A        N/A %
Tier I capital (2)        2,893,757    15.99%           N/A      N/A %         1,085,520     6.00%
Core (1)                  2,893,757     8.02%       1,082,532    3.00%         1,804,221     5.00%
Risk-weighted (2)         3,109,257    17.19%       1,447,360    8.00%         1,809,200    10.00%
 
          (1)  To adjusted total assets
          (2)  To risk-weighted assets.
 </TABLE> 
 
<TABLE> 
<CAPTION> 
                                                      Current Requirements
                                                      --------------------
          <S>                                         <C> 
          Total retained earnings                       $ 2,893,757
                                                        -----------
                                                      
          Tangible and core capital                       2,893,757
              General valuation allowance                   215,500
                                                        -----------
                                                      
          Risk-based capital                            $ 3,109,257
                                                        ===========
                                                      
          Total assets                                  $36,084,416
                                                        -----------
                                                      
          Tangible and adjusted tangible assets         $36,084,416
                                                        ===========
                                                      
          Risk-weighted assets                          $18,092,000
                                                        ===========
</TABLE>

                                     F-16
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 10- Income Taxes
         ------------

               The income tax provision consists of the following for the years
         ended December 31:

<TABLE>
<CAPTION>
                                         1997       1996
                                         ----       ----
         <S>                           <C>        <C>
         Current expense               $187,346   $114,469
         Deferred expense (benefit)     (96,173)   (24,888)
                                       --------   --------
            Total tax expense          $ 91,173   $ 89,581
                                       ========   ========
</TABLE>

            The income tax provision is reconciled to the amount computed to the
         statutory federal income tax rate as follows for December 31:

<TABLE>
<CAPTION>
                                              1997               1996
                                       -----------------  -----------------
                                        Amount      Rate    Amount     Rate
                                        ------      ----    ------     ----
<S>                                    <C>         <C>      <C>       <C>
Statutory federal income tax rate       $80,139    34.00%   $81,076   34.00%
State tax net of federal income tax              
 benefit                                 11,059     4.69     10,720    4.50
Surtax exemption                              -        -     (2,384)  (1.00)
Other                                       (25)    (.01)       169     .07
                                        -------    -----    -------   -----
                                        $91,173    38.68%   $89,581   37.57%
                                        =======    =====    =======   =====
</TABLE>

            The tax effects of temporary differences between financial reporting
         basis and income tax basis of assets and liabilities are as follows at
         December 31:

<TABLE>
<CAPTION>
                                                           1997        1996
                                                           ----        ----
         <S>                                            <C>         <C>
         Deferred Tax Assets:
            Deferred loan origination fees              $  27,571   $  42,354
            Deferred compensation                          44,413           -
            Unrealized loss on investment securities       32,160      44,442
            Allowance for loan losses                      83,226      38,620
                                                        ---------   ---------
                                                          187,370     125,416
 
         Deferred Tax Liabilities:
            Federal Home Loan Bank of Atlanta stock
             dividend                                     (32,595)    (32,595)
            Depreciation                                   (3,510)     (6,765)
            Excess of tax bad debt reserve over
             base year                                    (52,756)    (65,945)
            Conversion from accrual to cash method
             of accounting                                (72,230)    (77,723)
                                                        ---------   ---------
                                                         (161,091)   (183,028)
                                                        ---------   ---------
         Net deferred tax assets (liabilities)          $  26,279   $ (57,612)
                                                        =========   =========
</TABLE>

                                     F-17
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 10- Income Taxes - Continued
         ------------            

               The Association was allowed a special bad debt deduction limited
         generally to 8% of otherwise taxable income for the year beginning
         December 1, 1987 through December 31, 1995. Beginning January 1, 1996
         the percentage of taxable income method of computing the Association's
         tax bad debt deduction is no longer allowed and the amount by which the
         tax reserve for bad debts exceeds such amount at December 31, 1987 must
         be recaptured over a six year period. A tax liability has been
         established for the recapture. If the amounts which qualified as
         deductions for federal income tax purposes prior to December 31, 1987
         are later used for purposes other than to absorb loan losses, including
         distributions in liquidations, they will be subject to federal income
         tax at the then current corporate rate. Retained earnings at December
         31, 1997 and 1996 include $579,687, for which no provision for federal
         income tax has been provided. The unrecorded deferred income tax
         liability on the above amount was approximately $223,875.

Note 11 - Disclosures About Fair Value of Financial Instruments
          -----------------------------------------------------

               The estimated fair values of the Association's financial
          instruments are summarized below. The fair values of a significant
          portion of these financial instruments are estimates derived using
          present value techniques prescribed by the FASB and may not be
          indicative of the net realizable or liquidation values. Also, the
          calculation of estimated fair values is based on market conditions at
          a specific point in time and may not reflect current or future fair
          values.

               The carrying amount is a reasonable estimate of fair value for
          interest bearing deposits in other banks due to the short-term nature
          of that investment. Fair value is based upon net asset values for
          investment securities, bid prices published in financial newspapers
          for mortgage backed securities were used to estimate fair value for
          these investments. The carrying amount of Federal Home Loan Bank of
          Atlanta stock is a reasonable estimate of fair value. Loans receivable
          were discounted using a single discount rate, comparing the current
          rates at which similar loans would be made to borrowers with similar
          credit ratings and for the same remaining maturities, except for
          adjustable rate mortgages which were considered to be at market rates.
          These rates were used for each aggregated category of loans as
          reported on the Office of Thrift Supervision Quarterly Report. The
          fair value of demand deposits, savings accounts and money market
          deposits is the amount payable on demand at the reporting date. The
          fair value of fixed-maturity certificates of deposit is estimated
          using the rates currently offered on deposits of similar remaining
          maturities.

                                     F-18
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 11 - Disclosures About Fair Value of Financial Instruments - Continued
          -----------------------------------------------------            

<TABLE>
<CAPTION>
                                                December 31, 1997
                                              ----------------------
                                              Carrying    Estimated
                                               Amount    Fair Value
                                              ---------  -----------
                                              (Amounts in Thousands)
<S>                                           <C>        <C>
Financial Assets
- ----------------
   Interest bearing deposits
    in other banks                              $ 3,514      $ 3,514
   Mortgage backed securities                     1,955        2,011
   Federal Home Loan Bank of Atlanta stock          226          226
 
   Loans receivable                              29,961       31,772
 
Financial Liabilities
- ---------------------
   Savings                                      $ 2,605      $ 2,605
   NOW and money market deposit accounts          9,894        9,894
   Certificates of deposit                       20,108       20,222
   Advance payment by borrowers for
    expenses                                        371          371
</TABLE>

Note 12 - Plan of Conversion
          ------------------

               On December 17, 1997, the Board of Directors adopted a Plan of
          Conversion ("Plan"), whereby the Association will convert from a
          federally chartered mutual savings and loan to a federally chartered
          stock savings bank. The Plan is subject to approval of regulatory
          authorities and the Association's members at a special meeting. The
          stock of the Association will be issued to a holding company formed in
          connection with the conversion. The capital stock will be offered at a
          price to be determined by the Board of Directors based upon an
          appraisal to be made by an independent appraisal firm. The exact
          number of shares to be offered will be determined by the Board of
          Directors in conjunction with that appraisal. A Subscription Offering
          of shares of common stock will be offered initially to Eligible
          Account Holders, Employee Stock Benefit Plans of the Association,
          supplemental Eligible Account Holders and other members. Any shares of
          common stock not sold in the Subscription Offering will be sold in a
          Community Offering.

               At the time of the conversion, the Association will establish a
          Liquidation Account in an amount equal to its capital as of the date
          of the latest statement of financial condition appearing in the final
          prospectus. The Liquidation Account will be maintained for the benefit
          of Eligible Account Holders and Supplemental Eligible Account Holders
          who continue to maintain their accounts at the Association after the
          conversion.

                                     F-19
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 12 - Plan of Conversion - Continued
          ------------------            

               In the unlikely event of a complete liquidation of the
          Association, and only in such event, each Eligible Account Holder and
          Supplemental Eligible Account Holder would receive from the
          Liquidation Account, a liquidation distribution based on the
          proportionate share of the then total remaining qualifying deposits.

               Under the regulations of the Office of Thrift Supervision
          ("OTS"), the Association will not be permitted to pay dividends on its
          stock after the conversion if its regulatory capital would thereby be
          reduced below the amount then required for the forementioned
          Liquidation Account or the Association's regulatory capital
          requirements. Federal regulations also preclude any repurchase of the
          stock for three years after the conversion except for an offer made on
          a pro rata basis to all stockholders of the Association and with the
          prior approval of the OTS. The Association may, however, make capital
          distributions up to 100% of its net income plus the amount that would
          reduce by one-half its surplus capital ratio at the beginning of the
          calendar year, subject to the aforementioned restrictions, and the
          Association has not been notified that it is in need of more than
          normal supervision. As of December 31, 1997, the Association has not
          been notified that it requires more than normal supervision.

               The costs associated with the conversion are expected to be
          deferred and deducted from the proceeds from the sale of stock. If the
          conversion does not occur, related expenses will be deducted from
          current income. Costs of $22,712 were incurred through December 31,
          1997.

Note 13 - Recent Accounting Pronouncements
          --------------------------------

               FASB Statement on Accounting for Stock-Based Compensation - In
          October 1995, the Financial Accounting Standards Board ("FASB") issued
          SFAS No. 123. SFAS No. 123 defines a "fair value based method" of
          accounting for an employee stock option whereby compensation cost is
          measured at the grant date based on the value of the award and is
          recognized over the service period. FASB has encouraged all entities
          to adopt the fair value based method, however, it will allow entities
          to continue the use of the "intrinsic value based method" prescribed
          by Accounting Principles Board ("APB") Opinion No. 25. Under the
          intrinsic value based method, compensation cost is the excess of the
          market price of the stock at the grant date over the amount an
          employee must pay to acquire the stock. However, most stock option
          plans have no intrinsic value at the grant date and, as such, no
          compensation cost is recognized under APB Opinion No. 25. Entities
          electing to continued use of the accounting treatment of APB Opinion
          No. 25 must make certain pro forma disclosures as if the fair value
          based method had been applied. The accounting requirements of SFAS No.
          123 are effective for transactions entered into in fiscal years
          beginning after December 15, 1995. Pro forma disclosures must include
          the effects of all awards granted in fiscal years beginnings after
          December 14, 1994. If the proposed Option Plan is adopted management
          will use the intrinsic value method. Accordingly, there will be no
          impact as a result of the Association's adoption of SFAS No. 123.

                                     F-20
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 13 - Recent Accounting Pronouncements - Continued
          --------------------------------            

               FASB Statement on Accounting for Transfers and Servicing of
          Financial Assets and Extinguishments of Liabilities - In June 1996,
          FASB issued SFAS No. 125, which will be effective, on a prospective
          basis, for transfers and servicing of financial assets and
          extinguishment of liabilities occurring after December 31, 1996. SFAS
          No. 125 supersedes SFAS No. 122, Accounting for Mortgage Servicing
          Rights. SFAS No. 125 provides accounting and reporting standards for
          transfers and servicing of financial assets and extinguishment of
          liabilities based on consistent application of a financial-components
          approach that focuses on control. SFAS No. 125 extends the "available
          for sale" and "trading" approach of SFAS No. 115 to non-security
          financial assets that can be contractually prepaid or otherwise
          settled in such a way that the holder of the asset would not recover
          substantially all of its recorded investment. In addition, SFAS No.
          125 amends SFAS No. 115 to prevent a security from being classified as
          held to maturity if the security can be prepaid or settled in such a
          manner that the holder of the security would not recover substantially
          all of its recorded investment. The extension of the SFAS No. 115
          approach to certain non-security financial assets and the amendment to
          SFAS No. 115 are effective for financial assets held on or acquired
          after January 1, 1997. FASB has proposed to defer the effective date
          of SFAS No. 125 until January 1, 1998 for certain transactions
          including repurchase agreements, dollar-roll, securities lending and
          similar transactions. Management adopted SFAS No. 125 on January 1,
          1997. There was no impact on the Association's financial statements of
          such adoption.

               FASB Statement on Earnings Per Share - In February 1997, FASB
          issued SFAS No. 128, "Earnings Per Share". SFAS 128 supersedes APB
          Opinion No. 15, "Earnings Per Share" and specifies the computation,
          presentation and disclosure requirements for earnings per share for
          entities with publicly held common stock or potential common stock.
          SFAS No. 128 replaces the presentation of primary earnings per share
          with a presentation of basic earnings per share and fully diluted
          earnings per share with diluted earnings per share. It also requires
          dual presentation of basic and diluted earnings per share on the face
          of the income statement for all entities with complex capital
          structures and requires the reconciliation of the numerator and
          denominator of the basic earnings per share computation to the
          numerator and denominator of the diluted earnings per share
          computation. This Statement is effective for financial statements
          issued for periods ending after December 15, 1997, including interim
          periods. SFAS No. 128 will be adopted by the Association in the
          initial period after December 15, 1997. Management does not believe
          the impact of adopting SFAS No. 128 will be material to the
          Association's financial statements.

                                     F-21
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 13 - Recent Accounting Pronouncements - Continued
          --------------------------------            

               FASB Statement on Disclosure of Information About Capital
          Structure - In February 1997, FASB issued SFAS No. 129. The Statement
          incorporates the disclosure requirements of APB Opinion No. 15,
          "Earnings per Share", and makes them applicable to all public and
          nonpublic entities that have issued securities addressed by the
          Statement. APB Opinion No. 15 requires disclosure of descriptive
          information about securities that is not necessarily related to the
          computation of earnings per share. The Statement continues the
          previous requirements to disclose certain information about an
          entity's capital structure found in APB Opinion No. 10, Omnibus
          Opinion -1996 and No. 15, Earnings Per Share and FASB Statement No.
          47, Disclosure of Long-Term Obligations, for entities that were
          subject to the requirements of those standards. This Statement
          eliminates the exemption of nonpublic entities from certain disclosure
          requirements of Opinion 15 as provided by Statement No. 21, Suspension
          of the Reporting of Earnings per Share and Segment Information for
          Nonpublic Enterprises. It supersedes specific disclosure requirements
          of Opinion 10 and 15 and Statement 47 and consolidates them in this
          Statement for ease of retrieval and for greater visibility to
          nonpublic entities. This Statement is effective for financial
          statements for periods ending after December 15, 1997. SFAS No. 129
          will be adopted by the Association in the initial period after
          December 15, 1997. Management does not believe the impact of adopting
          SFAS No. 129 will be material to the Association's financial
          statements.

               FASB Statement on Reporting Comprehensive Income - In June 1997,
          FASB issued SFAS No. 130, "Reporting Comprehensive Income", which
          requires entities presenting a complete set of financial statements to
          include details of comprehensive income that arise in the reporting
          period. Comprehensive income consists of net income or loss for the
          current period and other comprehensive income, expense, gains and
          losses that bypass the income statement and are reported in a separate
          component of equity, i.e., unrealized gains and losses on certain
          investment securities. SFAS No. 130 is effective for fiscal years
          beginning after December 15, 1997. Management does not believe that
          adoption of SFAS No. 130 will have a material adverse effect on the
          Association's financial position or results of operations.

               FASB Statement on Disclosures Regarding Segments - In June 1997,
          FASB issued SFAS No. 131, "Disclosures about Segments of an Enterprise
          and Related Information". Statement 131 establishes standards for the
          way public enterprises are to report information about operating
          segments in annual financial statements and requires those enterprises
          to report selected information about operating segments in interim
          financial reports issued to stockholders. It also establishes
          standards for related disclosures about products and services,
          geographic areas and major customers. Statement 131 supersedes FASB
          Statement No. 14, "Financial Reporting for Segments of a Business
          Enterprise" but retains the requirement to report information about
          major customers. It amends Statement No. 94, "Consolidation of all
          Majority-Owned Subsidiaries" to remove the special disclosure
          requirements for previously unconsolidated subsidiaries.

                                     F-22
<PAGE>
 
NORTHFIELD FEDERAL SAVINGS
- --------------------------
Baltimore, Maryland
- -------------------

NOTES TO FINANCIAL STATEMENTS
- -----------------------------


Note 13 - Recent Accounting Pronouncements - Continued
          --------------------------------            

          Statement 131 is effective for financial statements for periods
          beginning after December 15, 1997. Management does not believe the
          impact of adopting SFAS No. 131 will be material to the Association's
          financial statements.

               FASB Statement on Employers Disclosures About Pensions and Other
          Postretirement Benefits - In February 1998, FASB issued SFAS No. 132
          which standardizes disclosure requirements for pensions and
          postretirement benefits. This Statement is effective for fiscal years
          beginning after December 15, 1997. Management believes the adoption of
          this Statement will not have a material effect on the financial
          statements of the Association.

                                     F-23
<PAGE>

                                   GLOSSARY

<TABLE> 
<S>                 <C> 
Bank                Northfield Federal Savings Bank, a federally chartered stock
                    savings bank

BIF                 Bank Insurance Fund of the FDIC

Common Stock        The common stock, $.01 par value per share, of Northfield
                    Bancorp, Inc.

Community Offering  Offering for sale to certain members of the general public
                    of any shares of common stock not subscribed for in the
                    Subscription Offering, including the possible offering of
                    common stock in a Syndicated Community Offering

Company             Northfield Bancorp, Inc.

Conversion          Simultaneous conversion of Northfield Federal Savings to a
                    stock savings bank, the issuance of the stock savings bank's
                    outstanding capital stock to the Company and the Company's
                    offer and sale of common stock
 
Eligible Account    Savings account holders of Northfield Federal Savings with
Holders             account balances of at least $50.00 as of the close of
                    business on December 31, 1995
 
 
ESOP                Employee Stock Ownership Plan
 
Estimated           Estimated pro forma market value of the common stock ranging
Valuation Range     from $3,825,000 to $5,175,000
 
Exchange Act        Securities Exchange Act of 1934, as amended
 
Expiration Date     __:__.m., Eastern Time, on ___________, 1998

FASB                Financial Accounting Standards Board

FDIC                Federal Deposit Insurance Corporation

Federal Reserve     The Board of Governors of the Federal Reserve System
System               

Ferguson            Ferguson & Company
</TABLE> 

                                      A-1
<PAGE>
 
<TABLE> 
<S>                 <C> 
FHLB                Federal Home Loan Bank

FHLMC               Federal Home Loan Mortgage Corporation

FNMA                Federal National Mortgage Association

IRA                 Individual retirement account or arrangement

IRS                 Internal Revenue Service

MRP                 Management recognition plan to be adopted no earlier than
                    six months after the conversion

NASD                National Association of Securities Dealers, Inc.

NOW account         Negotiable order of withdrawal account

NPV                 Net portfolio value

Offering            Subscription, Community and Syndicated Community Offerings,
                    collectively

Option Plan         Stock option plan to be adopted no earlier than six months
                    after the conversion

Order Form          Form for ordering stock accompanied by a certification
                    concerning certain matters

Other Members       Savings account holders (other than eligible account holders
                    and supplemental eligible account holders) and certain
                    borrowers (borrowers whose loans were outstanding on
                    ________ __, 199__ and continue to be outstanding) who are
                    entitled to vote at the Special Meeting due to the existence
                    of a savings account or a borrowing, respectively, on the
                    Voting Record Date for the Special Meeting

OTC Electronic      An electronic stock data system operated by Nasdaq
Bulletin Board      
     
OTS                 Office of Thrift Supervision
</TABLE> 

                                      A-2
<PAGE>
 
<TABLE> 
<S>                 <C> 
Plan of             Plan of Northfield Federal Savings to convert from a
Conversion          federally chartered mutual savings association to a
                    federally chartered stock savings bank, with the name
                    "Northfield Federal Savings Bank," and the issuance of the
                    Bank's outstanding capital stock to the Company and the
                    issuance of the Company's stock to the public

Purchase Price      $10.00 per share price of the common stock

SAIF                Savings Association Insurance Fund of the FDIC

SEC                 Securities and Exchange Commission

Securities Act      Securities Act of 1933, as amended

SFAS                Statement of Financial Accounting Standards adopted by FASB

Special Meeting     Special Meeting of members of Northfield Federal Savings
                    called for the purpose of approving the Plan of Conversion

Subscription        Offering of non-transferable rights to subscribe for the    
Offering            common stock, in order of priority, to Eligible Account     
                    Holders, tax-qualified employee plans, Supplemental Eligible
                    Account Holders and Other Members
                   
Supplemental        Depositors, who are not Eligible Account Holders of      
Eligible            Northfield Federal Savings, with account balances of at 
Account Holders     least $50.00 on March 31, 1998                           
                    
Syndicated          Offering of shares of common stock remaining after the  
Community Offering  Subscription Offering and undertaken prior to the end and as
                    part of the Community Offering, and which may, at our
                    discretion be made to the general public on a best efforts
                    basis by a selling group of broker-dealers

Trident Securities  Trident Securities, Inc.

Voting Record       The close of business on ___________, 1998, the date for
Date                determining members entitled to vote at the Special Meeting
</TABLE> 

                                      A-3
<PAGE>
 
No dealer, salesman or other person has been authorized to give any information
or to make any representations not contained in this document In connection with
the offering made hereby, and, if given or made, such information or
representations must not be relied upon as having been authorized by Northfield
Federal Savings, the Company, or Trident Securities.  This document does not
constitute an offer to sell, or the solicitation of an offer to buy, any of the
securities offered hereby to any person in any jurisdiction In which such offer
or solicitation would be unlawful. Neither the delivery of this document by
Northfield Federal Savings, the Company, or Trident Securities nor any sale made
hereunder shall in any circumstances create an implication that there has been
no change in the of Northfield Federal Savings or the Company, since any of the
dates as of which information is furnished herein or since the date hereof.


                            NORTHFIELD BANCORP, INC.

                              Up to 595,125 Shares
                                  Common Stock



                                   PROSPECTUS



                           TRIDENT SECURITIES,  INC.



                            Dated ___________, 1998



                 THESE SECURITIES ARE NOT DEPOSITS OR ACCOUNTS
                  AND ARE NOT FEDERALLY INSURED OR GUARANTEED.


Until the later of __________, 1998 (90 days after the date of this Prospectus),
all  dealers that  buy, sell or trade these securities, whether or not
participating in this distribution, may be required to deliver a prospectus.
This is in addition to the obligations of dealers to deliver a prospectus when
acting as underwriters and with respect to their unsold allotments or
subscriptions.
<PAGE>
 
                PART II: INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 24.  INDEMNIFICATION OF DIRECTORS AND OFFICERS

          Article XVII of the Company's Articles of Incorporation sets forth
circumstances under which directors, officers, employees and agents of the
Company may be indemnified against liability which they may incur in their
capacities, as follows:

                                 ARTICLE XVII

                                INDEMNIFICATION

          A.  The Corporation shall indemnify, to the fullest extent permissible
under the Maryland General Corporation Law, any individual who is or was a
director, officer, employee or agent of the Corporation, and any individual who
serves or served at the Corporation's request as a director, officer, partner,
trustee, employee or agent of another corporation, partnership, joint venture,
trust, other enterprise or employee benefit plan, in any proceeding in which the
individual is made a party as a result of his service in such capacity.

          B.  (1) Reasonable expenses incurred by any person identified in
paragraph A of this Article XVII who is a party to a proceeding will be paid or
reimbursed by the Corporation in advance of the final disposition of the
proceeding upon receipt by the Corporation of:  (i) a written affirmation by
such person of his good faith belief that the standard of conduct necessary for
indemnification by the Corporation as authorized in this Article XVII has been
met; and (ii) a written undertaking by or on behalf of such person to repay the
amount if it shall ultimately be determined that the standard of conduct has not
been met.

              (2) The undertaking required by subparagraph (ii) of paragraph (1)
of this subsection shall be an unlimited general obligation of such person but
need not be secured and may be accepted without reference to financial ability
to make the repayment.

          C.  Nonexclusive.  The indemnification and advance payment of expenses
              ------------                                                      
provided by paragraphs A and B shall not be exclusive of any other rights to
which a person may be entitled by law, bylaw, agreement, vote of stockholders or
disinterested directors, or otherwise.

          D.  Continuation.  The indemnification and advancement of expenses
              ------------                                                  
provided by this Article XVII shall be deemed to be a contract between the
Corporation and the persons entitled to indemnification thereunder, and any
repeal or modification of this Article XVII shall not affect any rights or
obligations then existing with respect to any state of facts then or theretofore
existing or any action, suit or proceeding theretofore or thereafter brought
based in whole or in part upon any such state of facts.  The indemnification and
advance payment provided by paragraphs A and B shall continue as to a person who
has ceased to hold a position named in paragraph A and shall inure to his heirs,
executors and administrators.

          E.  Insurance.  The Corporation shall purchase and maintain insurance
              ---------                                                        
on behalf of any person who holds or who has held any position named in
paragraph A, against any liability incurred by him in any such position, or
arising out of his status as such, whether or not the Corporation would have
power to indemnify him against such liability under paragraphs A and B.

          F.  Intention and Savings Clause.  It is the intention of this Article
              ----------------------------                                      
XVII to provide for indemnification to the fullest extent permitted by the
General Corporation Law of the State of Maryland, and this Article XVII shall be
interpreted accordingly.  If this Article XVII or any portion hereof shall be
invalidated on any ground by any court of competent jurisdiction, then the
Corporation shall nevertheless indemnify each director, officer, employee, and
agent 

                                      II-1
<PAGE>
 
of the Corporation as to costs, charges, and expenses (including attorneys'
fees), judgments, fines, and amounts paid in settlement with respect to any
action, suit, or proceeding, whether civil, criminal, administrative, or
investigative, including an action by or in the right of the Corporation, to the
full extent permitted by any applicable portion of this Article XVII that shall
not have been invalidated and to the full extent permitted by applicable law. If
the General Corporation Law of the State of Maryland is amended, or other
Maryland law is enacted, to permit further or additional indemnification of the
persons defined in this Article XVII.A, then the indemnification of such persons
shall be to the fullest extent permitted by the General Corporation Law of the
State of Maryland, as so amended, or such other Maryland law.

     Any repeal or modification of the foregoing paragraph by the stockholders
of the Corporation shall not adversely affect any right or protection of a
director of the Corporation existing at the time of such repeal or modification.

     In addition, Article XVI of the Company's Articles of Incorporation sets
forth the limits of a director's liability to the Company or its stockholders as
follows:

                                  ARTICLE XVI

               LIMITATION OF OFFICERS' AND DIRECTORS' LIABILITY

     An officer or director of the Corporation, as such, shall not be liable to
the Corporation or its stockholders for money damages, except (i) to the extent
that it is proved that the person actually received an improper benefit or
profit in money, property or services for the amount of the benefit or profit in
money, property or services actually received; (ii) to the extent that a
judgment or other final adjudication adverse to the person is entered in a
proceeding based on a finding in the proceeding that the person's action, or
failure to act, was the result of active and deliberate dishonesty and was
material to the cause of action adjudicated in the proceeding; or (iii) to the
extent otherwise required by Maryland law. If Maryland law is amended or enacted
after the date of filing of these Articles to further eliminate or limit the
personal liability of officers and directors, then the liability of officers and
directors of the Corporation shall be eliminated or limited to the fullest
extent permitted by Maryland law, as so amended. Any repeal or modification of
the foregoing paragraph by the stockholders of the Corporation shall not
adversely affect any right or protection of a director of the Corporation
existing at the time of such repeal or modification.

     Pursuant to its Charter and Tennessee law, the Company is permitted to
purchase and maintain insurance on behalf of an individual who is or was a
director, officer, employee, or agent of the Company. Northfield Federal
currently maintains such a policy and it is intended that the Company will
become a party to such policy.

                                      II-2
<PAGE>
 
ITEM 25.  OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

<TABLE>
         <S>                                                   <C> 
         *     Legal Fees and Expenses.......................  $ 82,000
         *     Printing, Word Processing, Postage and Mailing    50,000
         *     Appraisal and Business Plan Fees and Expenses.    25,000
         *     Accounting Fees and Expenses..................    40,000
         *     Blue Sky Filing Fees and Expenses
               (including counsel fees)......................     6,000
         *     Transfer Agent Fees and Stock Certificates....     6,000
         *     Conversion Agent Fees.........................     6,000
         *     Federal Filing Fees (OTS and SEC).............    25,000
         *     Underwriter=s Expenses........................    38,000
         *     Other Expenses................................    29,200
                                                               --------
         **    Total.........................................  $307,200
                                                               ========
</TABLE> 

______________
*    Estimated

**   Does not include $67,800 in estimated underwriting fees.  Calculation of
     the underwriting fees assumes that the midpoint of the Estimated Valuation
     Range is sold in the Conversion, 8% of the stock is sold to the ESOP,
     67,000 shares are sold to directors and officers of Northfield Federal, and
     the remaining shares are sold in the Subscription and Community Offerings.


ITEM 26.  RECENT SALES OF UNREGISTERED SECURITIES.

          Not applicable.


ITEM 27.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES:

          The exhibits and financial statement schedules filed as a part of this
registration statement are as follows:

          (a)  LIST OF EXHIBITS

<TABLE> 
<CAPTION> 
       EXHIBIT NO.                                DESCRIPTION
       -----------                                -----------
       <S>       <C> 
           1.1   Form of Sales Agency Agreement with Trident Securities,  Inc.             
                                                                                         
           1.2   Engagement Letter with Trident Securities, Inc.                         
                                                                                         
           2     Plan of Conversion (Exhibit A to Proxy Statement filed as Exhibit 99.2)
                                                                                         
           3.1   Articles of Incorporation of Northfield Bancorp, Inc.                   
                                                                                         
           3.2   Bylaws of Northfield Bancorp, Inc.                                      
                                                                                         
           4     Form of Common Stock Certificate of Northfield Bancorp, Inc.            
                                                                                         
           5     Opinion of Housley Kantarian & Bronstein, P.C. regarding legality of    
                 securities being registered                                             
                                                                                         
           8.1   Form of Federal Tax Opinion of Housley Kantarian & Bronstein, P.C.              
</TABLE> 

                                      II-3
<PAGE>
 
<TABLE> 
          <S>    <C> 
          8.2    Form of State Tax Opinion of Anderson Associates, LLP

          8.3    Opinion of Ferguson & Company as to the value of subscription rights for tax purposes 

          10.1   Form of Northfield Bancorp, Inc. 19__ Stock Option Plan

          10.2   Form of Northfield Bancorp, Inc. Management Recognition Plan

          10.3   Northfield Federal Savings Deferred Compensation Plan

         *10.4   Employment Agreement between Northfield Federal Savings and G. Ronald Jobson 

          23.1   Consent of Housley Kantarian & Bronstein, P.C. (in opinions filed as Exhibits 5 and 8.1) 

          23.2   Consent of Anderson Associates, LLP

          23.3   Consent of Ferguson & Company
 
          24     Power of Attorney (reference is made to the signature page of the Form SB-2) 

          27     Financial Data Schedule

        * 99.1   Proposed Form of Stock Order Form and Form of Certification

          99.2   Proxy Statement for Special Meeting of Members of Northfield Federal Savings; Form of Proxy 
                                 
          99.3   Form of Miscellaneous Solicitation and Marketing Materials

          99.4   Appraisal Report
</TABLE> 
______________
*       To be filed by amendment.

             (b)    FINANCIAL STATEMENT SCHEDULES.

          No financial statement schedules are filed because the required
information is not applicable or is included in the consolidated financial
statements or related notes.


ITEM 28. UNDERTAKINGS

          The undersigned Registrant hereby undertakes:

          (1) To file, during any period in which offers or sells securities, a
post-effective amendment to this registration statement:

              (i)  To include any prospectus required by Section 10(a)(3) of the
     Securities Act of 1933;

              (ii) To reflect in the prospectus any facts or events which,
     individually or together, represent a fundamental change in the information
     set forth in the registration statement (or the most recent post-effective
     amendment thereof);

                                      II-4
<PAGE>
 
          (iii)  To include any additional or changed material information on
     the plan of distribution.

     (2)  That, for the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment shall be deemed to be a
new registration statement of the securities offered, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.

     (3)  To file a post-effective amendment or remove from registration any of
the securities that remain unsold at the end of the offering.

  Insofar as indemnification for liabilities arising under the Securities Act
of 1933 (the "Act") may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act, and is therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the questions whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
<PAGE>
 
                                  SIGNATURES

     In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form SB-2 and authorized this registration
statement to be signed on its behalf by the undersigned, in the City of
Baltimore, State of Maryland, on March 24, 1998.
 
                              NORTHFIELD BANCORP, INC.


                              By: /s/ G. Ronald Jobson
                                  --------------------
                                  G. Ronald Jobson
                                  President and Chief Executive Officer
                                  (Duly Authorized Representative)


                               POWER OF ATTORNEY

     We, the undersigned Directors of Northfield Bancorp, Inc., hereby severally
constitute and appoint G. Ronald Jobson, who may act, with full power of
substitution, our true and lawful attorney and agent, to do any and all things
in our names in the capacities indicated below which said G. Ronald Jobson who
may act, may deem necessary or advisable to enable Northfield Bancorp, Inc. to
comply with the Securities Act of 1933, as amended, and any rules, regulations
and requirements of the Securities and Exchange Commission, in connection with
the registration of  Northfield Bancorp, Inc. common stock, including
specifically, but not limited to, power and authority to sign for us in our
names in the capacities indicated below, the registration statement and any and
all amendments (including post-effective amendments) thereto; and we hereby
ratify and confirm all that said G. Ronald Jobson shall do or cause to be done
by virtue thereof.

     In accordance with the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates stated.

     Signatures                        Title                           Date
     ----------                        -----                           ---- 
 
 
/s/ G. Ronald Jobson            President, Chief Executive        March 24, 1998
- -----------------------------                                    
G. Ronald Jobson                Officer and Director             
                                (Principal Executive Officer)    
                                                                 
/s/ John P. Sabol, Jr.          Vice President and Chief          March 24, 1998
- -----------------------------
John P. Sabol, Jr.              Financial Officer (Principal         
                                Accounting and Financial Officer)    
                                                                     
/s/ Gary R. Bozel               Chairman of the Board             March 24, 1998
- -----------------------------                                        
Gary R. Bozel                                                        
                                                                     
/s/ J. Thomas Hoffman           Director                          March 24, 1998
- -----------------------------                                        
J. Thomas Hoffman                                                    
                                                                     
/s/ E. Thomas Lawrence, Jr.     Director                          March 24, 1998
- -----------------------------                                        
E. Thomas Lawrence, Jr.                                              
                                                                     
/s/ David G. Rittenhouse        Director                          March 24, 1998
- -----------------------------                                        
David G. Rittenhouse                                                 
                                                                     
/s/ William R. Rush             Director                          March 24, 1998
- -----------------------------
William R. Rush

<PAGE>
 
                                                                     EXHIBIT 1.1

                           NORTHFIELD BANCORP, INC.
                           382,500 TO 595,125 SHARES

                                 COMMON STOCK
                          (PAR VALUE $.01 PER SHARE)

                               $10.00 PER SHARE

                            SALES AGENCY AGREEMENT
                            ----------------------


Trident Securities, Inc.
4601 Six Forks Road, Suite 400
Raleigh, North Carolina  27609

Ladies and Gentlemen:

     Northfield Bancorp, Inc., a Maryland corporation (the "Company"), and
Northfield Federal Savings, a federally chartered and insured mutual savings
bank (the "Bank"), hereby confirm, as of [  ], 1998, their respective agreements
with Trident Securities, Inc. ("Trident"), a broker-dealer registered with the
Securities and Exchange Commission ("Commission") and a member of the National
Association of Securities Dealers, Inc. ("NASD"), as follows:

     1.   Introductory.  The Bank intends to convert from a federally chartered
          ------------                                                         
mutual savings bank to a federally chartered stock savings bank as a wholly
owned subsidiary of the Company (together with the Offerings, as defined below,
and the issuance of shares of common stock of the Bank to the Company, the
"Conversion") pursuant to a plan of conversion adopted on December 17, 1997 (the
"Plan"). In accordance with the Plan, the Company is offering shares of its
common stock, par value $0.01 per share (the "Shares" and the "Common Stock"),
pursuant to nontransferable subscription rights in a subscription offering (the
"Subscription Offering") to certain depositors and borrowers of the Bank and to
the Bank's tax-qualified employee benefit plans (i.e., the Bank's Employee Stock
Ownership Plan (the "ESOP")). Concurrently with the Subscription Offering,
shares of the Common Stock not sold in the Subscription Offering are being
offered to the general public in a community offering, with preference being
given to natural persons residing in Baltimore County, Maryland (the "Bank's
Local Community") (the "Community Offering", together with the Subscription
Offering, the "Offerings"), subject to the right of the Company and the Bank, in
their sole discretion, to reject orders in the Community Offering in whole or in
part. In the Offerings, the Company is offering between 382,500 and 517,500
Shares, with the possibility of offering up to 595,125 Shares without a
resolicitation of subscribers, as contemplated by Title 12 of the Code of
Federal Regulations, Part 563b. No Eligible Account Holder, Supplemental
Eligible Account Holder or Other Member may purchase in their capacity as such
more than an amount equal to $125,000 of Common Stock in the Subscription
Offering. No person, individually or together with associates of and persons
acting in concert with such person, may purchase more than $125,000 of Common
Stock in the Community Offering. No person or entity, together with associates
or persons acting in concert, may purchase more than the lesser of $225,000 or
5% of the Shares issued.
<PAGE>
 
Trident Securities, Inc.
Page 2

     The Company and the Bank have been advised by Trident that Trident will
utilize its best efforts in assisting the Company and the Bank with the sale of
the Shares in the Offerings and, if deemed necessary by the Company, in a
syndicated community offering. Prior to the execution of this Agreement, the
Company has delivered to Trident the Prospectus, dated May [ ], 1998 (as
hereinafter defined), and all supplements thereto to be used in the Offerings.
Such Prospectus contains information with respect to the Company, the Bank and
the Shares.

     2.   Representations and Warranties.
          ------------------------------ 

          (a)  The Company and the Bank jointly and severally represent and
     warrant to Trident that:

               (i) The Company has filed with the Commission a registration
          statement, including exhibits and an amendment or amendments thereto,
          on Form S-1 (No. [ ]), including a Prospectus relating to the
          Offerings, for the registration of the Shares under the Securities Act
          of 1933, as amended (the "Act"); and such registration statement has
          become effective under the Act and no stop order has been issued with
          respect thereto and no proceedings therefor have been initiated or, to
          the Company's best knowledge, threatened by the Commission. Except as
          the context may otherwise require, such registration statement, as
          amended or supplemented, on file with the Commission at the time the
          registration statement became effective, including the Prospectus,
          financial statements, schedules, exhibits and all other documents
          filed as part thereof, as amended and supplemented, is herein called
          the "Registration Statement," and the prospectus, as amended or
          supplemented, on file with the Commission at the time the Registration
          Statement became effective is herein called the "Prospectus," except
          that if the prospectus filed by the Company with the Commission
          pursuant to Rule 424(b) of the general rules and regulations of the
          Commission under the Act (together with the enforceable published
          policies and actions of the Commission thereunder, the "SEC
          Regulations") differs from the form of prospectus on file at the time
          the Registration Statement became effective, the term "Prospectus"
          shall refer to the Rule 424(b) prospectus from and after the time it
          is filed with or mailed for filing to the Commission and shall include
          any amendments or supplements thereto from and after their dates of
          effectiveness or use, respectively. If any Shares remain unsubscribed
          following completion of the Subscription Offering and the Community
          Offering, the Company (a) will, if required by the SEC Regulations,
          promptly file with the Commission a post-effective amendment to such
          Registration Statement relating to the results of the Subscription and
          the Community Offerings, any additional information with respect to
          the proposed plan of distribution and any revised pricing information
          or (b) if no such post-effective amendment is required, will file
          with, or mail for filing to, the Commission a prospectus or prospectus
          supplement containing information relating to the results of the
          Subscription and Community Offerings and pricing information pursuant
          to Rule 424(c) of the Regulations, in either case in a form reasonably
          acceptable to the Company and Trident.
<PAGE>
 
Trident Securities, Inc.
Page 3

               (ii)  The Bank has filed an Application for Approval of
          Conversion on Form AC, including exhibits (as amended or supplemented,
          the "Form AC" and together with the Form H-(e)1-S referred to below,
          the "Conversion Application") with the Office of Thrift Supervision
          (the "Office") under the Home Owners' Loan Act, as amended (the
          "HOLA") and the enforceable rules and regulations, including published
          policies and actions, of the Office thereunder (the "OTS
          Regulations"), which has been approved by the Office; and the
          Prospectus and the proxy statement for the solicitation of proxies
          from members for the special meeting to approve the Plan (the "Proxy
          Statement") included as part of the Form AC have been approved for use
          by the Office. No order has been issued by the Office preventing or
          suspending the use of the Prospectus or the Proxy Statement; and no
          action by or before the Office revoking such approvals is pending or,
          to the Bank's best knowledge, threatened. The Company has filed with
          the Office the Company's application on Form H-e(1)-S promulgated
          under the savings and loan holding company provisions of the HOLA and
          the regulations promulgated thereunder and has received approval of
          its acquisition of the Bank from the Office.

               (iii) At the date of the Prospectus and at all times subsequent
          thereto through and including the Closing Date (i) the Registration
          Statement and the Prospectus (as amended or supplemented, if amended
          or supplemented) complied with the Act and the Regulations, (ii) the
          Registration Statement (as amended or supplemented, if amended or
          supplemented) did not contain an untrue statement of a material fact
          or omit to state a material fact required to be stated therein or
          necessary to make the statements therein not misleading, and (iii) the
          Prospectus (as amended or supplemented, if amended or supplemented)
          did not contain any untrue statement of a material fact or omit to
          state any material fact required to be stated therein or necessary to
          make the statements therein, in light of the circumstances under which
          they were made, not misleading. Representations or warranties in this
          subsection shall not apply to statements or omissions made in reliance
          upon and in conformity with written information furnished to the
          Company or the Bank relating to Trident by or on behalf of Trident
          expressly for use in the Registration Statement or Prospectus.

               (iv)  The Company has been duly incorporated as a Maryland
          corporation, and the Bank has been duly organized as a mutual savings
          bank under the laws of the United States, and each of them is validly
          existing and in good standing under the laws of the jurisdiction of
          its organization with full power and authority to own its property and
          conduct its business as described in the Registration Statement and
          Prospectus; the Bank is a member in good standing of the Federal Home
          Loan Bank of Atlanta; and the deposit accounts of the Bank are insured
          by the Savings Association Insurance Fund ("SAIF") administered by the
          Federal Deposit Insurance Corporation ("FDIC") up to the applicable
          legal limits. Neither the Company nor the
<PAGE>
 
Trident Secuities, Inc.
Page 4

          Bank is required to be qualified to do business as a foreign
          corporation in any jurisdiction where non-qualification would have a
          material adverse effect on the Company and the Bank, taken as a whole.
          The Bank does not own equity securities of or an equity interest in
          any business enterprise. Upon amendment of the Bank's charter and
          bylaws as provided in the rules and regulations of the Office and
          completion of the sale by the Company of the Shares as contemplated by
          the Prospectus, (a) the Bank will be converted pursuant to the Plan to
          a federally chartered capital stock savings bank with full power and
          authority to own its property and conduct its business as described in
          the Prospectus, (b) all of the authorized and outstanding capital
          stock of the Bank will be owned of record and beneficially by the
          Company, and (c) the Company will have no direct subsidiaries other
          than the Bank.

               (v)   Each of the Bank and the Subsidiary has good, marketable
          and insurable title to all assets material to its business and to
          those assets described in the Prospectus as owned by it, free and
          clear of all material liens, charges, encumbrances or restrictions,
          except (a) for liens for taxes not yet due, (b) as described in the
          Prospectus, (c) and as could not in the aggregate have a material
          adverse effect upon the operations or financial condition of the
          Company and the Bank, taken as a whole; and all of the leases and
          subleases material to the operations or financial condition of the
          Bank, under which it holds properties, including those described in
          the Prospectus, are in full force and effect as described therein.

               (vi)  The execution and delivery of this Agreement and the
          consummation of the transactions contemplated hereby have been duly
          and validly authorized by all necessary actions on the part of each of
          the Company and the Bank, and this Agreement is a valid and binding
          obligation with valid execution and delivery of each of the Company
          and the Bank, enforceable in accordance with its terms (except as the
          enforceability thereof may be limited by bankruptcy, insolvency,
          moratorium, reorganization or similar laws relating to or affecting
          the enforcement of creditors' rights generally or the rights of
          creditors of savings and loan holding companies the accounts of whose
          subsidiaries are insured by the FDIC or by general equity principles,
          regardless of whether such enforceability is considered in a
          proceeding in equity or at law, and except to the extent that the
          provisions of Sections 8 and 9 hereof may be unenforceable as against
          public policy or pursuant to Section 23A of the Federal Reserve Act,
          12 U.S.C. Section 371c ("Section 23A")).

               (vii) There is no litigation or governmental proceeding pending
          or, to the best knowledge of the Company or the Bank, threatened
          against or involving the Company, the Bank or any of their respective
          assets which individually or in the aggregate could reasonably be
          expected to have a material adverse effect on the
<PAGE>
 
Trident Secuities, Inc.
Page 5

          condition (financial or otherwise), results of operations and
          business, including the assets and properties, of the Company and the
          Bank, taken as a whole.

               (viii) The Company and the Bank have received the opinion of
          Housley Kantarian & Bronstein, P.C. to the effect that the Conversion
          will constitute a tax-free reorganization under the Internal Revenue
          Code of 1986, as amended, and the opinion of Anderson Associates, LLP
          to the effect that the Conversion will not be a taxable transaction
          for the Bank or the Company under the income tax laws of Maryland. The
          Company and the Bank also have received the opinion of Ferguson &
          Company which, based upon the assumptions set forth in the Prospectus,
          concludes that the subscription rights to be received by Eligible
          Account Holders (as defined in the Prospectus) and other eligible
          subscribers do not have any economic value at the time of distribution
          or at the time the subscription rights are exercised, whether or not a
          public offering takes place. The facts relied upon in each of the
          above-referenced opinions are accurate and complete.

               (ix)   Each of the Company and the Bank has all such corporate
          power, authority, authorizations, approvals and orders as may be
          required to enter into this Agreement and to carry out the provisions
          and conditions hereof, subject to the limitations set forth herein and
          subject to the satisfaction of certain conditions imposed by the
          Office in connection with its approvals of the Form AC and the
          Application H-(e)1-S, and except as may be required under the
          securities, or "blue sky," laws of various jurisdictions, and, in the
          case of the Company, as of the Closing Date, will, to the actual
          knowledge of the Company, have such approvals and orders to issue and
          sell the Shares to be sold by the Company as provided herein, and, in
          the case of the Bank, as of the Closing Date, will, to the actual
          knowledge of the Bank, have such approvals and orders to issue and
          sell the Shares of its common stock to be sold to the Company as
          provided in the Plan, subject to the issuance of an amended charter in
          the form required for federally chartered stock savings banks (the
          "Stock Charter"), the form of which Stock Charter has been approved by
          the Office.

               (x)    Neither the Company nor the Bank is in violation of any
          rule or regulation of the Office or the FDIC that could reasonably be
          expected to result in any enforcement action against the Company, the
          Bank or their officers or directors that could reasonably be expected
          to have a material adverse effect on the condition (financial or
          otherwise), operations, businesses, assets or properties of the
          Company and the Bank, taken as a whole.

               (xi)   The consolidated financial statements and any related
          notes or schedules which are included in the Registration Statement
          and the Prospectus fairly present the consolidated financial
          condition, income, retained earnings and cash flows
<PAGE>
 
Trident Securities, Inc.
Page 6

          of the Bank at the respective dates thereof and for the respective
          periods covered thereby and comply as to form with the applicable
          accounting requirements of the SEC Regulations and the applicable
          accounting regulations of the Office. Such financial statements have
          been prepared in accordance with generally accepted accounting
          principles consistently applied throughout the periods involved,
          except as set forth therein, and such financial statements are
          consistent with financial statements and other reports filed by the
          Bank with supervisory and regulatory authorities except as such
          generally accepted accounting principles may otherwise require. The
          tables in the Prospectus accurately present the information purported
          to be shown thereby at the respective dates thereof and for the
          respective periods therein.

               (xii)  There has been no material change in the condition
          (financial or otherwise), results of operations or business, including
          assets and properties, of the Company and the Bank, taken as a whole,
          since the latest date as of which such condition is set forth in the
          Prospectus, except as set forth therein; and the capitalization,
          assets, properties and business of each of the Company and the Bank
          conform in all material respects to the descriptions thereof contained
          in the Prospectus. Neither the Company nor the Bank has any material
          liabilities of any kind, contingent or otherwise, except as set forth
          in the Prospectus.

               (xiii) There has been no breach or default (or the occurrence of
          any event which, with notice or lapse of time or both, would
          constitute a default) under, or creation or imposition of any lien,
          charge or other encumbrance upon any of the properties or assets of
          the Company or the Bank pursuant to any of the terms, provisions or
          conditions of, any agreement, contract, indenture, bond, debenture,
          note, instrument or obligation to which the Company or the Bank is a
          party or by which either of them or any of their respective assets or
          properties may be bound or is subject, or violation of any
          governmental license or permit or any enforceable published law,
          administrative regulation or order or court order, writ, injunction or
          decree, which breach, default, encumbrance or violation would have a
          material adverse effect on the condition (financial or otherwise),
          operations, business, assets or properties of the Company and the
          Bank, taken as a whole; all agreements which are material to the
          condition (financial or otherwise), results of operations or business
          of the Company and the Bank, taken as a whole, are in full force and
          effect, and no party to any such agreement has instituted or, to the
          best knowledge of the Company and the Bank, threatened any action or
          proceeding wherein the Company or the Bank would be alleged to be in
          default thereunder.

               (xiv)  Neither the Company nor the Bank is in violation of its
          respective articles of incorporation, charter or bylaws. The execution
          and delivery hereof and the consummation of the transactions
          contemplated hereby by the Company and the
<PAGE>
 
Trident Securities, Inc.
Page 7


          Bank do not conflict with or result in a breach of the articles of
          incorporation, charter or bylaws of the Company, the Bank (in either
          mutual or stock form) or constitute a material breach of or default
          (or an event which, with notice or lapse of time or both, would
          constitute a default) under, give rise to any right of termination,
          cancellation or acceleration contained in, or result in the creation
          or imposition of any lien, charge or other encumbrance upon any of the
          properties or assets of the Company or the Bank pursuant to any of the
          terms, provisions or conditions of, any material agreement, contract,
          indenture, bond, debenture, note, instrument or obligation to which
          the Company or the Bank is a party or violate any governmental license
          or permit or any enforceable published law, administrative regulation
          or order or court order, writ, injunction or decree (subject to the
          satisfaction of certain conditions imposed by the Office in connection
          with its approval of the Conversion Application), which breach,
          default, encumbrance or violation would have a material adverse effect
          on the condition (financial or otherwise), operations or business of
          the Company and the Bank, taken as a whole.

               (xv)  Subsequent to the respective dates as of which information
          is given in the Registration Statement and Prospectus and prior to the
          Closing Date (as hereinafter defined), except as otherwise may be
          indicated or contemplated therein, neither the Company nor the Bank
          has issued any securities which will remain issued at the Closing Date
          or incurred any liability or obligation, direct or contingent, or
          borrowed money, except liabilities, obligations or borrowings in the
          ordinary course of business, or entered into any other transaction not
          in the ordinary course of business and consistent with prior
          practices, which is material in light of the business of the Company
          and the Bank, taken as a whole.

               (xvi) Upon consummation of the Conversion, the authorized, issued
          and outstanding equity capital of the Company shall be within the
          range as set forth in the Prospectus under the caption
          "Capitalization," and no Common Stock of the Company shall be
          outstanding immediately prior to the Closing Date; the issuance and
          the sale of the Shares of the Company have been duly authorized by all
          necessary action of the Company and approved by the Office and, when
          issued in accordance with the terms of the Plan and paid for, shall be
          validly issued, fully paid and nonassessable and shall conform to the
          description thereof contained in the Prospectus; the issuance of the
          Shares is not subject to preemptive rights, except as set forth in the
          Prospectus; and good title to the Shares will be transferred by the
          Company upon issuance thereof against payment therefor, free and clear
          of all claims, encumbrances, security interests and liens against the
          Company whatsoever. The certificates representing the Shares will
          conform in all material respects with the requirements of applicable
          laws and regulations. The issuance and sale of the capital stock of
          the Bank to the Company has been duly authorized by all necessary
          action of
<PAGE>
 
Trident Securities, Inc.
Page 8

          the Bank and the Company and appropriate regulatory authorities
          (subject to the satisfaction of various conditions imposed by the
          Office in connection with its approval of the Conversion Application),
          and such capital stock, when issued in accordance with the terms of
          the Plan, will be fully paid and nonassessable and will conform in all
          material respects to the description thereof contained in the
          Prospectus.

               (xvii)  No approval of any regulatory or supervisory or other
          public authority is required in connection with the execution and
          delivery of this Agreement or the issuance of the Shares, except for
          the declaration of effectiveness of any required post-effective
          amendment by the Commission and approval thereof by the Office and
          approval of the Company's application on Form H-(e)1-S by the Office,
          the issuance of the Stock Charter by the Office and as may be required
          under the securities laws of various jurisdictions.

               (xviii) All contracts and other documents required to be filed as
          exhibits to the Registration Statement or the Conversion Application
          have been filed with the Commission and/or the Office, as the case may
          be.

               (xix)   Anderson Associates, LLP, which has audited the financial
          statements of the Bank at December 31, 1997 and for the years ended
          December 31, 1996 and 1997, included in the Prospectus, is an
          independent public accountant within the meaning of the Code of
          Professional Ethics of the American Institute of Certified Public
          Accountants and Title 12 of the Code of Federal Regulations, Section
          571.2(c)(3).

               (xx)    The Company and the Bank have timely filed all required
          federal, state and local franchise tax returns, and no deficiency has
          been asserted with respect to such returns by any taxing authorities,
          and the Company and the Bank have paid all taxes that have become due
          and, to the best of their knowledge, have made adequate reserves for
          similar future tax liabilities, except where any failure to make such
          filings, payments and reserves, or the assertion of such a deficiency,
          would not have a material adverse effect on the condition of the
          Company and the Bank, taken as a whole.

               (xxi)   All of the loans represented as assets of the Bank on the
          most recent financial statements of the Bank included in the
          Prospectus meet or are exempt from all requirements of federal, state
          or local law pertaining to lending, including without limitation truth
          in lending (including the requirements of Regulation Z and 12 C.F.R.
          Part 226 and Section 563.99), real estate settlement procedures,
          consumer credit protection, equal credit opportunity and all
          disclosure laws applicable to such loans,
<PAGE>
 
Trident Securities, Inc.
Page 9

          except for violations which, if asserted, would not have a material
          adverse effect on the Company, the Bank and the Subsidiary taken as a
          whole.

               (xxii)  The records of account holders, depositors, borrowers and
          other members of the Bank delivered to Trident by the Bank or its
          agent for use during the Conversion have been prepared or reviewed by
          the Bank and, to the best knowledge of the Company and the Bank, are
          reliable and accurate.

               (xxiii) None of the Company, the Bank nor the employees of the
          Company or the Bank has made any payment of funds to the Company or
          the Bank prohibited by law, and no funds of the Company or the Bank
          have been set aside to be used for any payment prohibited by law.

               (xxiv)  To the best knowledge of the Company and the Bank, the
          Company and the Bank are in compliance with all laws, rules and
          regulations relating to environmental protection and neither the
          Company nor the Bank believes that the Company or the Bank is subject
          to liability under the Comprehensive Environmental Response,
          Compensation and Liability Act of 1980, as amended, or any similar
          law, except for violations which, if asserted, would not have a
          material adverse effect on the Company and the Bank, taken as a whole.
          There are no actions, suits, regulatory investigations or other
          proceedings pending or, to the best knowledge of the Company or the
          Bank, threatened against the Company or the Bank relating to
          environmental protection. To the best knowledge of the Company and the
          Bank, no disposal, release or discharge of hazardous or toxic
          substances, pollutants or contaminants, including petroleum and gas
          products, as any of such terms may be defined under federal, state or
          local law, has been caused by the Company or the Bank or, to the best
          knowledge of the Company or the Bank, has occurred on, in or at any of
          the facilities or properties of the Company or the Bank, except such
          disposal, release or discharge which could not have a material adverse
          effect on the Company and the Bank, taken as a whole.

               (xxv)   At the Closing Date, the Company and the Bank will have
          completed the conditions precedent to, and shall have conducted the
          Conversion in all material respects in accordance with, the Plan, the
          OTS Regulations and all other applicable laws, regulations, published
          decisions and orders, including all terms, conditions, requirements
          and provisions precedent to the Conversion imposed by the Office.
<PAGE>
 
Trident Securities, Inc.
Page 10

     (b)  Trident represents and warrants to the Company and the Bank that:

               (i)   Trident is registered as a broker-dealer with the
          Commission, and is in good standing with the Commission and the NASD.

               (ii)  Trident is validly existing as a corporation in good
          standing under the laws of its jurisdiction of incorporation, with
          full corporate power and authority to provide the services to be
          furnished to the Company and the Bank hereunder.

               (iii) The execution and delivery of this Agreement and the
          consummation of the transactions contemplated hereby have been duly
          and validly authorized by all necessary action on the part of Trident,
          and this Agreement is a legal, valid and binding obligation of
          Trident, enforceable in accordance with its terms (except as the
          enforceability thereof may be limited by bankruptcy, insolvency,
          moratorium, reorganization or similar laws relating to or affecting
          the enforcement of creditors' rights generally or the rights of
          creditors of registered broker-dealers accounts of whose may be
          protected by the Securities Investor Protection Corporation or by
          general equity principles, regardless of whether such enforceability
          is considered in a proceeding in equity or at law, and except to the
          extent that the provisions of Sections 8 and 9 hereof may be
          unenforceable as against public policy or pursuant to Section 23A).

               (iv)  Each of Trident and, to Trident's knowledge, its employees,
          agents and representatives who shall perform any of the services
          required hereunder to be performed by Trident shall be duly authorized
          and shall have all licenses, approvals and permits necessary to
          perform such services, and Trident is a registered selling agent in
          the jurisdictions listed in Exhibit A hereto and will remain
          registered in such jurisdictions in which the Company is relying on
          such registration for the sale of the Shares, until the Conversion is
          consummated or terminated.

               (v)   The execution and delivery of this Agreement by Trident,
          the fulfillment of the terms set forth herein and the consummation of
          the transactions contemplated hereby shall not violate or conflict
          with the corporate charter or bylaws of Trident or violate, conflict
          with or constitute a breach of, or default (or an event which, with
          notice or lapse of time, or both, would constitute a default) under,
          any material agreement, indenture or other instrument by which Trident
          is bound or under any governmental license or permit or any law,
          administrative regulation, authorization, approval or order or court
          decree, injunction or order.
<PAGE>
 
Trident Securities, Inc.
Page 11

               (vi)  Any funds received by Trident to purchase Common Stock will
          be handled in accordance with Rule 15c2-4 under the Securities
          Exchange Act of 1934, as amended (the "Exchange Act").

               (vii) There is not now pending or, to Trident's knowledge,
          threatened against Trident any action or proceeding before the
          Commission, the NASD, any state securities commission or any state or
          federal court concerning Trident's activities as a broker-dealer.

     3.   Employment of Trident; Sale and Delivery of the Shares.  On the basis
          ------------------------------------------------------               
of the representations and warranties herein contained, but subject to the terms
and conditions herein set forth, the Company and the Bank hereby employ Trident
as their agent to utilize its best efforts in assisting the Company with the
Company's sale of the Shares in the Subscription Offering and Community
Offering. The employment of Trident hereunder shall terminate (a) forty-five
(45) days after the Subscription and Community Offering closes, unless the
Company and the Bank, with the approval of the Office, are permitted to extend
such period of time, or (b) upon consummation of the Conversion, whichever date
shall first occur.

     In the event the Company is unable to sell a minimum of 382,500 Shares (or
such lesser amount as the Office may permit) within the period herein provided,
this Agreement shall terminate, and the Company and the Bank shall refund
promptly to any persons who have subscribed for any of the Shares, the full
amount which it may have received from them, together with interest as provided
in the Prospectus, and no party to this Agreement shall have any obligation to
the other party hereunder, except as set forth in Sections 6, 8(a) and 9 hereof.
Appropriate arrangements for placing the funds received from subscriptions for
Shares in special interest-bearing accounts with the Bank until all Shares are
sold and paid for were made prior to the commencement of the Subscription and
Community Offering, with provision for prompt refund to the purchasers as set
forth above, or for delivery to the Company if all Shares are sold.

     If all conditions precedent to the consummation of the Conversion are
satisfied, including the sale of all Shares required by the Plan to be sold, the
Company agrees to issue or have issued such Shares and to release for delivery
certificates to subscribers thereof for such Shares on the Closing Date against
payment to the Company by any means authorized pursuant to the Prospectus, at
the principal office of the Company at 8005 Harford Road, Baltimore, Maryland
21234 or at such other place as shall be agreed upon between the parties hereto.
The date upon which Trident is paid the compensation due hereunder is herein
called the "Closing Date."

     Trident agrees either (a) upon receipt of executed order forms of
subscribers to forward, for deposit in a segregated account, the offering price
of the Common Stock ordered on or before twelve noon on the next business day
following receipt or execution of an order form by Trident to the Bank or (b) to
solicit indications of interest in which event (i) Trident will subsequently
contact any 
<PAGE>
 
Trident Securities, Inc.
Page 12

potential subscriber indicating interest to confirm the interest and give
instructions to execute and return an order form or to receive authorization to
execute the order form on the subscriber's behalf, (ii) Trident will mail
acknowledgments of receipt of orders to each subscriber confirming interest on
the business day following such confirmation, (iii) Trident will debit accounts
of such subscribers on the fifth business day ("debit date") following receipt
of the confirmation referred to in (i), and (iv) Trident will forward completed
order forms together with such funds to the Bank on or before twelve noon on the
next business day following the debit date for deposit in a segregated account.
Trident acknowledges that if the procedure in (b) is adopted, subscribers' funds
are not required to be in their accounts until the debit date.

     In addition to the expenses specified in Section 6 hereof, Trident shall
receive the following compensation for its services hereunder:

          (a)  A commission equal to two percent (2.00%) of the aggregate dollar
     amount of any Shares sold in the Subscription Offering and the Community
     Offering, excluding (i) any Shares sold to the ESOP, the Bank's executive
     officers, directors and their "Associates" (as such term is defined in the
     Plan) and (ii) Shares sold by other NASD member firms under selected
     dealer's arrangements. For stock sold under selected dealer's arrangements,
     the commission payable shall be as agreed upon by the Company and Trident
     to reflect market requirements at the time of the stock allocation in the
     Syndicated Community Offering. All such fees and commissions payable to
     Trident are to be payable in next-day funds to Trident in Raleigh, North
     Carolina on the Closing Date.

          (b)  Trident shall be reimbursed for allocable expenses, including but
     not limited to travel, communications, legal fees and postage, incurred by
     it whether or not the Offerings are successfully completed; provided,
                                                                 --------
     however, that reimbursable legal fees will not exceed $28,000 (excluding
     -------
     reasonable out of pocket expenses), that other reimbursable expenses will
     not exceed $10,000 and that neither the Company nor the Bank shall pay or
     reimburse Trident for any of the foregoing expenses accrued after Trident
     shall have notified the Company or the Bank of its election to terminate
     this Agreement pursuant to Section 11 hereof or after such time as the
     Company or the Bank shall have given notice in accordance with Section 12
     hereof that Trident is in breach of this Agreement. Full payment to defray
     Trident's reimbursable expenses shall be made in next-day funds on the
     Closing Date or, if the Conversion is not completed and is terminated for
     any reason, within ten (10) business days of receipt by the Company of a
     written request from Trident for reimbursement of its expenses. Trident
     acknowledges receipt of $10,000 advance payment from the Bank which shall
     be credited against the total reimbursement due Trident hereunder.

          (c)  Notwithstanding the limitations on reimbursement of Trident for
     allocable expenses provided in the immediately preceding paragraph (b), in
     the event that a resolicitation or other event causes the Offerings to be
     extended beyond their original
<PAGE>
 
Trident Securities, Inc.
Page 13

     expiration date, Trident shall be reimbursed for its allocable expenses
     incurred during such extended period, provided that the allowance for
     allocable expenses provided for in the immediately preceding paragraph (b)
     above have been exhausted and subject to the following. Such reimbursement
     shall be in amount equal to the product obtained by dividing $10,000
     (original out-of-pocket expenses) by the total number of days of the
     unextended Subscription Offering (calculated from the date of the
     Prospectus to the intended close of the Subscription Offering as stated in
     the Prospectus) and multiplying such product by the number of days of the
     extension (that number of days from the date of the supplemental prospectus
     used in the extended Subscription Offering to the closing of the extension
     of the Subscription Offering described in such supplemental prospectus).

     The Company shall pay any stock issue and transfer taxes which may be
payable with respect to the sale of the Shares.  The Company and the Bank also
shall pay all expenses of the Conversion incurred by them or on their prior
approval including but not limited to their attorneys' fees, NASD filing fees,
and attorneys' fees relating to any required state securities laws research and
filings, telephone charges, air freight, rental equipment, supplies, transfer
agent charges, fees relating to auditing and accounting and costs of printing
all documents necessary in connection with the Conversion.

     4.   Offering.  Subject to the provisions of Section 7 hereof, Trident is
          --------                                                            
assisting the Company on a best efforts basis in offering a minimum of 382,500
and a maximum of 517,500 Shares, with the possibility of offering up to 595,125
Shares (except as the Office may permit to be decreased or increased) in the
Subscription and Community Offerings.  The Shares are to be offered to the
public at the price set forth on the cover page of the Prospectus and the first
page of this Agreement.

     5.   Further Agreements.  The Company and the Bank jointly and severally
          ------------------                                                 
covenant and agree that:

          (a)  The Company shall deliver to Trident, from time to time, such
     number of copies of the Prospectus as Trident reasonably may request. The
     Company authorizes Trident to use the Prospectus in any lawful manner in
     connection with the offer and sale of the Shares.

          (b)  The Company will notify Trident immediately upon discovery, and
     confirm the notice in writing, (i) when any post-effective amendment to the
     Registration Statement becomes effective or any supplement to the
     Prospectus has been filed, (ii) of the issuance by the Commission of any
     stop order relating to the Registration Statement or of the initiation or
     the threat of any proceedings for that purpose, (iii) of the receipt of any
     notice with respect to the suspension of the qualification of the Shares
     for offering or sale in any jurisdiction, and (iv) of the receipt of any
     comments (other than those of a non-substantive nature) from the
<PAGE>
 
Trident Securities, Inc.
Page 14

     staff of the Commission relating to the Registration Statement. If the
     Commission enters a stop order relating to the Registration Statement at
     any time, the Company will make every reasonable effort to obtain the
     lifting of such order at the earliest possible moment.

          (c)  During the time when a prospectus is required to be delivered
     under the Act, the Company will comply so far as it is able with all
     requirements imposed upon it by the Act, as now in effect and hereafter
     amended, and by the SEC Regulations, as from time to time in force, so far
     as necessary to permit the continuance of offers and sales of or dealings
     in the Shares in accordance with the provisions hereof and the Prospectus.
     If during the period when the Prospectus is required to be delivered in
     connection with the offer and sale of the Shares any event relating to or
     affecting the Company and the Bank, taken as a whole, shall occur as a
     result of which it is necessary, in the opinion of counsel for Trident,
     with the concurrence of counsel to the Company, to amend or supplement the
     Prospectus in order to make the Prospectus not false or misleading in light
     of the circumstances existing at the time it is delivered to a purchaser of
     the Shares, the Company forthwith shall prepare and furnish to Trident a
     reasonable number of copies of an amendment or amendments or of a
     supplement or supplements to the Prospectus (in form and substance
     satisfactory to counsel for Trident) which shall amend or supplement the
     Prospectus so that, as amended or supplemented, the Prospectus shall not
     contain an untrue statement of a material fact or omit to state a material
     fact necessary in order to make the statements therein, in light of the
     circumstances existing at the time the Prospectus is delivered to a
     purchaser of the Shares, not misleading. The Company will not file or use
     any amendment or supplement to the Registration Statement or the Prospectus
     of which Trident has not first been furnished a copy or to which Trident
     shall reasonably object after having been furnished such copy. For the
     purposes of this subsection the Company and the Bank shall furnish such
     information with respect to themselves as Trident from time to time may
     reasonably request.

          (d)  The Company and the Bank have taken, or will take, all reasonably
     necessary action as may be required to qualify or register the Shares for
     offer and sale by the Company under the securities or blue sky laws of such
     jurisdictions as Trident and either the Company or its counsel may agree
     upon; provided, however, that the Company shall not be obligated to qualify
           --------- -------
     as a foreign corporation to do business under the laws of any such
     jurisdiction. In each jurisdiction where such qualification or registration
     shall be effected, the Company, unless Trident agrees that such action is
     not necessary or advisable in connection with the distribution of the
     Shares, shall file and make such statements or reports as are, or
     reasonably may be, required by the laws of such jurisdiction.

          (e)  Appropriate entries will be made in the financial records of the
     Bank sufficient to establish a liquidation account for the benefit of
     eligible account holders as of December 31, 1995 in accordance with the
     requirements of the Office.
<PAGE>
 
Trident Securities, Inc.
Page 15

          (f)  The Company will file a registration statement for the Common
     Stock under Section 12(b) or Section 12(g) of the Exchange Act, prior to
     completion of the stock offering pursuant to the Plan and shall request
     that such registration statement be effective upon completion of the
     Conversion. The Company shall maintain the effectiveness of such
     registration for a minimum period of three (3) years or for such shorter
     period as may be required by applicable law.

          (g)  The Company will make generally available to its security holders
     as soon as practicable, but not later than ninety (90) days after the close
     of the period covered thereby, an earnings statement (in form complying
     with the provisions of Rule 158 of the regulations promulgated under the
     Act) covering a twelve-month period beginning not later than the first day
     of the Company's fiscal quarter next following the effective date (as
     defined in said Rule 158) of the Registration Statement.

          (h)  For a period of three (3) years from the date of this Agreement
     (unless the Common Stock shall have been deregistered under the Exchange
     Act), the Company will furnish to Trident, as soon as publicly available
     after the end of each fiscal year, a copy of its annual report to
     shareholders for such year; and the Company will furnish to Trident (i) as
     soon as publicly available, a copy of each report or definitive proxy
     statement of the Company filed with the Commission under the Exchange Act
     or mailed to shareholders, and (ii) from time to time, such other public
     information concerning the Company as Trident may reasonably request.

          (i)  The Company shall use the net proceeds from the sale of the
     Shares consistently with the manner set forth in the Prospectus.

          (j)  The Company shall not deliver the Shares until each and every
     condition set forth in Section 7 hereof has been satisfied, unless such
     condition is waived by Trident.

          (k)  The Company shall advise Trident, if necessary, as to the
     allocation of deposits, in the case of Eligible Account Holders and
     Supplemental Eligible Account Holders, and votes, in the case of other
     members, and of the Shares in the event of an oversubscription and shall
     provide Trident final instructions as to the allocation of the Shares
     ("Allocation Instructions") in such event and such information shall be
     accurate and reliable. Trident shall be entitled to rely on such
     instructions and shall have no liability in respect of its reliance
     thereon, including without limitation, no liability for or related to any
     denial or grant of a subscription in whole or in part.

          (l)  The Company and the Bank will take such actions and furnish such
     information as are reasonably requested by Trident in order for Trident to
     ensure compliance with the NASD's "Interpretation Relating to Free-Riding
     and Withholding."
<PAGE>
 
Trident Securities, Inc.
Page 16

     6.   Payment of Expenses.  Whether or not the Conversion is consummated,
          -------------------                                                
the Company and the Bank shall pay or reimburse Trident for (a) all filing fees
paid or incurred by Trident in connection with all filings with the NASD with
respect to the Subscription and Community Offerings and, (b) if the Company is
unable to sell a minimum of 382,500 Shares or such lesser amount as the Office
may permit or the Conversion is otherwise terminated, the Company and the Bank
shall reimburse Trident for allocable expenses incurred by Trident relating to
the offering of the Shares as provided in Section 3 hereof; provided, however,
that neither the Company nor the Bank shall pay or reimburse Trident for any of
the foregoing expenses accrued after Trident shall have notified the Company or
the Bank of its election to terminate this Agreement pursuant to Section 11
hereof or after such time as the Company or the Bank shall have given notice in
accordance with Section 12 hereof that Trident is in breach of this Agreement.

     7.   Conditions of Trident's Obligations.  Except as may be waived by
          -----------------------------------                             
Trident, the obligations of Trident as provided herein shall be subject to the
accuracy of the representations and warranties contained in Section 2 hereof as
of the date hereof and as of the Closing Date, to the performance by the Company
and the Bank of their obligations hereunder and to the following conditions:
 
          (a)  At the Closing Date, Trident shall receive the favorable opinion
     of Housley Kantarian & Bronstein, P.C., special counsel for the Company and
     the Bank, dated the Closing Date, addressed to Trident, in form and
     substance reasonably satisfactory to counsel for Trident and to the effect
     that:

               (i)   The Company has been duly incorporated, and the Company is
          validly existing as a corporation in good standing under the laws of
          its jurisdiction of incorporation, and the Bank is validly existing as
          a savings bank in mutual form in good standing under the laws of the
          United States, each with full power and authority to own its
          properties and conduct its business as described in the Prospectus;

               (ii)  each of the Company and the Bank has been qualified to do
          business and, to such counsel's actual knowledge, is in good standing
          as a foreign corporation in each jurisdiction where the ownership or
          leasing of its properties or the conduct of its business requires such
          qualification or, if not so qualified and in good standing, failure to
          so qualify would not have any material adverse effect on the Company
          and the Bank, taken as a whole;

               (iii) the Bank is a member of the Federal Home Loan Bank of
          Atlanta, and the deposit accounts of the Bank are insured by the SAIF
          up to the applicable legal limits;
<PAGE>
 
Trident Securities, Inc.
Page 17

               (iv)   to the actual knowledge of such counsel, the activities of
          the Bank, as such activities are described in the Prospectus, are
          permitted under federal law, and the Bank does not have any
          subsidiaries;

               (v)    the Plan complies with the HOLA and the OTS Regulations;
          to such counsel's knowledge, all of the terms, conditions,
          requirements and provisions with respect to the Plan and the
          Conversion imposed by the Office, except with respect to the filing or
          submission of certain required post-Conversion reports or other
          materials by the Company or the Bank, have been complied with by the
          Company and the Bank; and, to the actual knowledge of such counsel, no
          person has sought to obtain regulatory or judicial review of the final
          action of the Office in approving the Plan;

               (vi)   the Company and the Bank have authorized the common stock
          as set forth in the Registration Statement and the Prospectus, and the
          description of such common stock in the Registration Statement and the
          Prospectus is accurate in all material respects;

               (vii)  the issuance and sale of the Shares have been duly and
          validly authorized by all necessary corporate action on the part of
          the Company; the Shares, upon receipt of payment and issuance in
          accordance with the terms of the Plan and this Agreement, will be
          validly issued, fully paid, nonassessable and, except as disclosed in
          the Prospectus, free of preemptive rights, and good title thereto
          shall be transferred by the Company free and clear of all claims,
          encumbrances, security interests and liens created by the Company;

               (viii) the certificates for the Shares are in proper form and
          comply in all material respects with applicable Maryland law;

               (ix)   the issuance and sale of the capital stock of the Bank to
          the Company has been duly authorized by all necessary corporate action
          of the Bank and the Company and have received the approval of the
          Office, and such capital stock, upon receipt of payment and issuance
          in accordance with the terms of the Plan, will be validly issued,
          fully paid and nonassessable and owned of record and, to the knowledge
          of such counsel, beneficially by the Company;
<PAGE>
 
Trident Securities, Inc.
Page 18

               (x)    subject to the satisfaction of the conditions to the
          Office's approval of the Conversion Application, no further approval,
          authorization, consent or other order of any public board or body is
          required in connection with the execution and delivery of this
          Agreement or the consummation of the Conversion, except with respect
          to the issuance to the Bank of the Stock Charter by the Office;

               (xi)   the execution and delivery of this Agreement and the
          consummation of the Conversion have been duly and validly authorized
          by all necessary corporate action on the part of each of the Company
          and the Bank;

               (xii)  the statements in the Prospectus and incorporated by
          reference in the Proxy Statement under the captions "Regulation,"
          "Taxation," "Dividends," "Certain Restrictions on Acquisition of the
          Company" and "Description of Capital Stock," insofar as they are, or
          refer to, statements of law or legal conclusions (excluding financial
          data included therein, as to which an opinion need not be expressed),
          have been or reviewed by such counsel and are correct in all material
          respects;

               (xiii) the Form AC has been approved by the Office, and the
          Prospectus and the Proxy Statement have been authorized for use by the
          Office; the Registration Statement and any post-effective amendment
          thereto has been declared effective by the Commission; except as to
          any necessary qualifications or registration under the securities laws
          of the jurisdictions in which the Shares were offered, no further
          approval of any governmental authority is required for the issuance
          and sale of the Shares (subject to the satisfaction of various
          conditions subsequent imposed by the Office in connection with its
          approval of the Conversion Application), and to the actual knowledge
          of such counsel, no proceedings are pending by or before the
          Commission or the Office seeking to revoke or rescind the orders
          declaring the Registration Statement effective or approving the
          Conversion Application or, to the actual knowledge of such counsel,
          are contemplated or threatened (provided that for this purpose such
          counsel need not regard any litigation or governmental procedure to be
          "threatened" unless the potential litigant or government authority has
          manifested to the management of the Company or the Bank, or to such
          counsel, a present intention to initiate such litigation or
          proceeding);

               (xiv)  the execution and delivery of this Agreement and the
          consummation of the Conversion by the Company and the Bank do not
          conflict with or result in a breach of the articles of incorporation,
          charter or bylaws of the Company or the Bank (in either mutual or
          stock form); and
<PAGE>
 
Trident Securities, Inc.
Page 19

               (xv)    the Conversion Application, the Registration Statement,
          the Prospectus and the Proxy Statement, in each case as amended,
          comply as to form in all material respects with the requirements of
          the Act, the HOLA, the SEC Regulations and the OTS Regulations, as the
          case may be (except as to information with respect to Trident included
          therein and financial statements, notes to financial statements,
          financial tables and other financial and statistical data, including
          the appraisal, included therein, as to which an opinion need not be
          expressed); to such counsel's actual knowledge, all documents and
          exhibits required to be filed with the Conversion Application and the
          Registration Statement have been so filed and the descriptions in the
          Conversion Application and the Registration Statement of such
          documents and exhibits are accurate in all material respects.

               (xvi)   to the knowledge of such counsel, the Bank has obtained
          all licenses, permits and other governmental authorizations currently
          required for the conduct of its business as such business is described
          in the Prospectus, all such licenses, permits and other governmental
          authorizations are in full force and effect and the Bank is in all
          material respects complying therewith, except where the failure to
          hold such licenses, permits or governmental authorizations or the
          failure to so comply would not have a material adverse effect on the
          Company and the Bank, taken as a whole;

               (xvii)  there are no material legal or governmental proceedings
          pending or, to the knowledge of such counsel, threatened against or
          involving the assets of the Company or the Bank.

               (xviii) this Agreement is a legal, valid and binding obligation
          of each of the Company and the Bank, enforceable in accordance with
          its terms (except as the enforceability thereof may be limited by
          bankruptcy, insolvency, moratorium, reorganization, receivership,
          conservatorship or similar laws relating to or affecting the
          enforcement of creditors' rights generally or the rights of creditors
          of depository institutions whose accounts are insured by the FDIC or
          savings and loan holding companies the accounts of whose subsidiaries
          are insured by the FDIC or by general equity principles, regardless of
          whether such enforceability is considered in a proceeding in equity or
          at law, and except to the extent that the provisions of Sections 8 and
          9 hereof may be unenforceable as against public policy or pursuant to
          Section 23A, as to which no opinion need be rendered);

               (xiv)  to the best knowledge of such counsel, the execution and
          delivery of this Agreement and the consummation of the Conversion by
          the Company and the Bank do not constitute a material breach of or
          default (or an event which, with notice or lapse of time or both,
          would constitute a default) under, give rise to any right of
          termination, cancellation or acceleration contained in, or result in
          the creation or
<PAGE>
 
Trident Securities, Inc.
Page 20

          imposition of any lien, charge or other encumbrance upon any of the
          properties or assets of the Company or the Bank pursuant to any of the
          terms, provisions or conditions of, any material agreement, contract,
          indenture, bond, debenture, note, instrument or obligation to which
          the Company or the Bank is a party or violate any governmental license
          or permit or any enforceable published law, administrative regulation
          or order or court order, writ, injunction or decree (subject to the
          satisfaction of certain conditions imposed by the Office in connection
          with its approval of the Conversion Application), which breach,
          default, encumbrance or violation would have a material adverse effect
          on the condition (financial or otherwise), operations, business,
          assets or properties of the Company and the Bank, taken as a whole;
          and

               (xx)  to the knowledge of such counsel, there has been no
          material breach of any provision of the Company's or the Bank's
          articles of incorporation, charter or bylaws or breach or default (or
          the occurrence of any event which, with notice or lapse of time or
          both, would constitute a default) under any agreement, contract,
          indenture, bond, debenture, note, instrument or obligation to which
          the Company, the Bank or the Subsidiary is a party or by which any of
          them or any of their respective assets or properties may be bound, or
          any governmental license or permit, or a violation of any enforceable
          published law, administrative regulation or order, or court order,
          writ, injunction or decree which breach, default, encumbrance or
          violation would have a material adverse effect on the condition
          (financial or otherwise), operations, business, assets or properties
          of the Company, the Bank and the Subsidiary taken as a whole;

          In rendering such opinion, such counsel may rely as to matters of fact
     on certificates of officers and directors of the Company and the Bank and
     certificates of public officials delivered pursuant hereto. Such counsel
     may assume that any agreement is the valid and binding obligation of any
     parties to such agreement other than the Company and the Bank. Such opinion
     may be governed by, and interpreted in accordance with, the Legal Opinion
     Accord (the "Accord") of the ABA Section of Business Law (1991), and, as a
     consequence, such opinion is subject to the qualifications, exceptions,
     definitions, limitations on coverage and other limitations, all as more
     particularly described in the Accord, and it should be read in conjunction
     therewith. In addition, the "General Qualifications" set forth in the
     Accord apply to the opinions set forth in such opinion. Such opinion may be
     limited to present statutes, regulations and judicial interpretations and
     to facts as they presently exist; in rendering such opinion, such counsel
     need assume no obligation to revise or supplement it should the present
     laws be changed by legislative or regulatory action, judicial decision or
     otherwise; and such counsel need express no view, opinion or belief with
     respect to whether any proposed or pending legislation, if enacted, or any
     regulations or any policy statements issued by any regulatory agency,
     whether or not promulgated pursuant to any such
<PAGE>
 
Trident Securities, Inc.
Page 21

     legislation, would affect the validity of the execution and delivery by the
     Company and the Bank of this Agreement or the issuance of the Shares.

          (c)  At the Closing Date, Trident shall receive the letter of Housley
     Kantarian & Bronstein, P.C., special counsel for the Company and the Bank,
     dated the Closing Date, addressed to Trident, in form and substance
     reasonably satisfactory to counsel for Trident and to the effect that: (i)
     based on such counsel's participation in conferences with representatives
     of the Company, the Bank, the independent appraiser, the independent
     certified public accountants, Trident and its counsel, review of documents
     and understanding of applicable law (including the requirements of Form S-1
     and the character of the Registration Statement contemplated thereby) and
     the experience such counsel has gained in its practice under the Act,
     nothing has come to such counsel's attention that would lead it to believe
     that the Registration Statement, as amended (except as to information in
     respect of Trident contained therein and except as to the financial
     statements, notes to financial statements, financial tables and other
     financial and statistical data contained therein, as to which such counsel
     need express no comment), at the time it became effective contained any
     untrue statement of a material fact or omitted to state a material fact
     required to be stated therein or necessary to make the statements made
     therein, in light of the circumstances under which they were made, not
     misleading, or that the Prospectus, as amended (except as to information in
     respect of Trident contained therein and except as to financial statements,
     notes to financial statements, financial tables and other financial and
     statistical data contained therein as to which such counsel need express no
     comment), at the time the Prospectus was filed with the Commission under
     Rule 424(b) and at the Closing Date, contained any untrue statement of a
     material fact or omitted to state a material fact necessary to make the
     statements therein, in light of the circumstances under which they were
     made, not misleading (in making this statement such counsel may state that
     it has not undertaken to verify independently the information in the
     Registration Statement or Prospectus and, therefore, does not assume any
     responsibility for the accuracy or completeness thereof).

          (d)  Counsel for Trident shall have been furnished such documents as
     they reasonably may require for the purpose of enabling them to review or
     pass upon the matters required by Trident, and for the purpose of
     evidencing the accuracy, completeness or satisfaction of any of the
     representations, warranties or conditions herein contained, including but
     not limited to, resolutions of the Board of Directors of the Company and
     the Bank regarding the authorization of this Agreement and the transactions
     contemplated hereby.

          (e)  Prior to and at the Closing Date, in the reasonable opinion of
     Trident, (i) there shall have been no material change in the condition,
     financial or otherwise, business or results of operations of the Company
     and the Bank, taken as a whole, since the latest date as of which such
     condition is set forth in the Prospectus, except as referred to therein;
     (ii) there shall have been no transaction entered into by the Company or
     the Bank after the latest date
<PAGE>
 
Trident Securities, Inc.
Page 22

     as of which the financial condition of the Company or the Bank is set forth
     in the Prospectus other than transactions referred to or contemplated
     therein, transactions in the ordinary course of business, and transactions
     which are not materially adverse to the Company or the Bank, taken as a
     whole; (iii) neither the Company nor the Bank shall have received from the
     Office or Commission any direction (oral or written) to make any change in
     the method of conducting their respective business which is material to the
     business of the Company and the Bank, taken as a whole, with which they
     have not complied; (iv) no action, suit or proceeding, at law or in equity
     or before or by any federal or state commission, board or other
     administrative agency, shall be pending or threatened against the Company
     or the Bank or affecting any of their respective assets, wherein an
     unfavorable decision, ruling or finding would have a material adverse
     effect on the business, operations, financial condition or income of the
     Company and the Bank, taken as a whole; and (v) the Shares shall have been
     qualified or registered for offering and sale by the Company under the
     securities or blue sky laws of such jurisdictions as Trident and the
     Company shall have agreed upon.

          (f)  At the Closing Date, Trident shall receive a certificate of the
     principal executive officer and the principal financial officer of each of
     the Company and the Bank, dated the Closing Date, to the effect that: (i)
     they have examined the Prospectus and, at the time the Prospectus became
     authorized by the Company for use, the Prospectus did not contain an untrue
     statement of a material fact or omit to state a material fact necessary in
     order to make the statements therein, in light of the circumstances under
     which they were made, not misleading with respect to the Company or the
     Bank; (ii) since the date the Prospectus became authorized by the Company
     for use, no event has occurred which should have been set forth in an
     amendment or supplement to the Prospectus which has not been so set forth,
     including specifically, but without limitation, any material change in the
     business, condition (financial or otherwise) or results of operations of
     the Company or the Bank, and the conditions set forth in clauses (ii)
     through (iv) inclusive of subsection (d) of this Section 7 have been
     satisfied; (iii) to the best knowledge of such officers, no order has been
     issued by the Commission or the Office to suspend the Subscription Offering
     or the Community Offering or the effectiveness of the Prospectus, and no
     action for such purposes has been instituted or threatened by the
     Commission or the Office; (iv) to the best knowledge of such officers, no
     person has sought to obtain review of the final actions of the Office and
     division approving the Plan; and (v) all of the representations and
     warranties contained in Section 2 of this Agreement are true and correct,
     with the same force and effect as though expressly made on the Closing
     Date.

          (g)  At the Closing Date, Trident shall receive, among other
     documents, (i) copies of the letters from the Office authorizing the use of
     the Prospectus and the Proxy Statement; (ii) a copy of the order of the
     Commission declaring the Registration Statement effective; (iii) copies of
     the letters from the Office evidencing the corporate existence of the Bank;
     (iv) a copy of the letter from the appropriate Delaware authority
     evidencing the incorporation (and,
<PAGE>
 
Trident Securities, Inc.
Page 23

     if generally available from such authority, good standing) of the Company;
     (v) a copy of the Company's articles of incorporation certified by the
     appropriate Maryland governmental authority; and (vi), if available, a copy
     of the letter from the Office approving the Bank's Stock Charter.

          (h)  As soon as available after the Closing Date, Trident shall
     receive a certified copy of the Bank's Stock Charter executed by the
     appropriate federal governmental authority.

          (i)  Concurrently with the execution of this Agreement, Trident
     acknowledges receipt of a letter from Anderson Associates, LLP, independent
     certified public accountants, addressed to Trident and the Company, in
     substance and form satisfactory to counsel for Trident, with respect to the
     financial statements and certain financial information contained in the
     Prospectus.

          (j)  At the Closing Date, Trident shall receive a letter in form and
     substance satisfactory to counsel for Trident from Anderson Associates,
     LLP, independent certified public accountants, dated the Closing Date and
     addressed to Trident and the Company, confirming the statements made by
     them in the letter delivered by them pursuant to the preceding subsection
     as of a specified date not more than five (5) days prior to the Closing
     Date.

     All such opinions, certificates, letters and documents shall be in
compliance with the provisions hereof only if they are, in the reasonable
opinion of Trident and its counsel, satisfactory to Trident and its counsel.
Any certificates signed by an officer or director of the Company or the Bank
prepared for Trident's reliance and delivered to Trident or to counsel for
Trident shall be deemed a representation and warranty by the Company and the
Bank to Trident as to the statements made therein.  If any condition to
Trident's obligations hereunder to be fulfilled prior to or at the Closing Date
is not so fulfilled, Trident may terminate this Agreement or, if Trident so
elects, may waive any such conditions which have not been fulfilled, or may
extend the time for their fulfillment. If Trident terminates this Agreement as
aforesaid, the Company and the Bank shall reimburse Trident for its expenses as
provided in Section 3(b) hereof.

     8.   Indemnification.
          --------------- 

          (a)  The Company and the Bank jointly and severally agree to indemnify
     and hold harmless Trident, its officers, directors and employees and each
     person, if any, who controls Trident within the meaning of Section 15 of
     the Act or Section 20(a) of the Exchange Act, against any and all loss,
     liability, claim, damage and expense whatsoever and shall further promptly
     reimburse such persons for any legal or other expenses reasonably incurred
     by each or any of them in investigating, preparing to defend or defending
     against any such action, proceeding or claim (whether commenced or
     threatened) arising out of or based upon (i) any
<PAGE>
 
Trident Securities, Inc.
Page 24

     misrepresentation by the Company or the Bank in this Agreement or any
     breach of warranty by the Company or the Bank with respect to this
     Agreement or arising out of or based upon any untrue or alleged untrue
     statement of a material fact or the omission or alleged omission of a
     material fact required to be stated or necessary to make not misleading any
     statements contained in (A) the Registration Statement or the Prospectus or
     (B) any application (including the Form AC and the Form H-(e)1-S) or other
     document or communication (in this Section 8 collectively called
     "Application") prepared or executed by or on behalf of the Company or the
     Bank or based upon written information furnished by or on behalf of the
     Company or the Bank, whether or not filed in any jurisdiction, to effect
     the Conversion or qualify the Shares under the securities laws thereof or
     filed with the Office or Commission, unless such statement or omission was
     made in reliance upon and in conformity with written information furnished
     to the Company or the Bank with respect to Trident by or on behalf of
     Trident expressly for use in the Prospectus or any amendment or supplement
     thereof or in any Application, as the case may be, or (ii) the
     participation by Trident in the Conversion. Notwithstanding the foregoing,
     no indemnification shall be required for material oral misstatements made
     by Trident, its officers, agents, servants or employees which are not based
     upon information provided by or on behalf of the Company or the Bank orally
     or in writing or based upon information contained in the Registration
     Statement, the Prospectus or in any Application. This indemnity shall be in
     addition to any liability the Company and the Bank may have to Trident
     otherwise.

          (b)   The Company shall indemnify and hold Trident harmless for any
     liability whatsoever arising out of (i) the Allocation Instructions or (ii)
     any records of account holders, depositors, borrowers and other members of
     the Bank delivered to Trident by the Bank or its agents for use during the
     Conversion.

          (c)   Trident agrees to indemnify and hold harmless the Company and
     the Bank, their officers, directors and employees and each person, if any,
     who controls the Company and the Bank within the meaning of Section 15 of
     the Act or Section 20(a) of the Exchange Act, to the same extent as the
     foregoing indemnity from the Company and the Bank to Trident, but only with
     respect to (i) statements or omissions, if any, made in the Prospectus or
     any amendment or supplement thereof in any Application or to a purchaser of
     the Shares in reliance upon, and in conformity with, written information
     furnished to the Company or the Bank with respect to Trident by or on
     behalf of Trident expressly for use in the Prospectus or in any
     Application; (ii) any misrepresentation by Trident in Section 2(b) of this
     Agreement; or (iii) any liability of the Company or the Bank which is found
     in a final judgment by a court of competent jurisdiction (not subject to
     further appeal) to have principally and directly resulted from gross
     negligence or willful misconduct of Trident.

          (d)   Promptly after receipt by an indemnified party under this
     Section 8 of notice of the commencement of any action, such indemnified
     party will, if a claim in respect thereof
<PAGE>
 
Trident Securities, Inc.
Page 25

     is to be made against the indemnifying party under this Section 8, notify
     the indemnifying party of the commencement thereof; but the omission so to
     notify the indemnifying party will not relieve it from any liability which
     it may have to any indemnified party otherwise than under this Section 8.
     In case any such action is brought against any indemnified party, and it
     notifies the indemnifying party of the commencement thereof, the
     indemnifying party will be entitled to participate therein and, to the
     extent that it may wish, jointly with the other indemnifying party
     similarly notified, to assume the defense thereof, with counsel
     satisfactory to such indemnified party, and after notice from the
     indemnifying party to such indemnified party of its election so to assume
     the defense thereof, the indemnifying party will not be liable to such
     indemnified party under this Section 8 for any legal or other expenses
     subsequently incurred by such indemnified party in connection with the
     defense thereof other than the reasonable cost of investigation except as
     otherwise provided herein. In the event the indemnifying party elects to
     assume the defense of any such action and retain counsel acceptable to the
     indemnified party, the indemnified party may retain additional counsel, but
     shall bear the fees and expenses of such counsel unless (i) the
     indemnifying party shall have specifically authorized the indemnified party
     to retain such counsel or (ii) the parties to such suit include such
     indemnifying party and the indemnified party, and such indemnified party
     shall have been advised by counsel that one or more material legal defenses
     may be available to the indemnified party which may not be available to the
     indemnifying party, in which case the indemnifying party shall not be
     entitled to assume the defense of such suit notwithstanding the
     indemnifying party's obligation to bear the fees and expenses of such
     counsel. An indemnifying party against whom indemnity may be sought shall
     not be liable to indemnify an indemnified party under this Section 8 if any
     settlement of any such action is effected without such indemnifying party's
     consent. To the extent required by law, this Section 8 is subject to and
     limited by the provisions of Section 23A.

     9.   Contribution.  In order to provide for just and equitable contribution
          ------------                                                          
in circumstances in which the indemnity agreement provided for in Section 8
above is for any reason held to be unavailable to Trident, the Company and/or
the Bank other than in accordance with its terms, the Company or the Bank and
Trident shall contribute to the aggregate losses, liabilities, claims, damages,
and expenses of the nature contemplated by said indemnity agreement incurred by
the Company or the Bank and Trident (a) in such proportion as is appropriate to
reflect the relative benefits received by the Company and the Bank, on the one
hand, and Trident, on the other hand, from the offering of the Shares or (b) if
the allocation provided by clause (a) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (a) above, but also the relative fault of the Company or
the Bank, on the one hand, and Trident, on the other hand, in connection with
the statements or omissions which resulted in such losses, claims, damages,
liabilities or judgments, as well as any other relevant equitable
considerations.  The relative benefits received by the Company and the Bank, on
the one hand, and Trident, on the other hand, shall be deemed to be in the same
proportions as the total net proceeds from the Conversion received by the
Company and the Bank bear to the total fees received by
<PAGE>
 
Trident Securities, Inc.
Page 26

Trident under this Agreement. The relative fault of the Company or the Bank, on
the one hand, and Trident on the other hand, shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or the Bank or by Trident and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.

     The Company and the Bank and Trident agree that it would not be just and
equitable if contribution pursuant to this Section 9 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by the indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 9, Trident shall not be required
to contribute any amount in excess of the amount by which fees owed Trident
pursuant to this Agreement exceeds the amount of any damages which Trident has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission.  No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who is not guilty of such fraudulent
misrepresentation. To the extent required by law, this Section 9 is subject to
and limited by the provisions of Section 23A.

     10.  Survival of Agreements, Representations and Indemnities.  The
          --------------------------------------------------------     
respective indemnities of the Company and the Bank and Trident and the
representation and warranties of the Company and the Bank and of Trident set
forth in or made pursuant to this Agreement shall remain in full force and
effect, regardless of any termination or cancellation of this Agreement or any
investigation made by or on behalf of Trident or the Company or the Bank or any
controlling person or indemnified party referred to in Section 8 hereof, and
shall survive any termination or consummation of this Agreement and/or the
issuance of the Shares, and any legal representative of Trident, the Company,
the Bank and any such controlling persons shall be entitled to the benefit of
the respective agreements, indemnities, warranties and representations.

     11.  Termination.  Trident may terminate this Agreement by giving the
          -----------                                                     
notice indicated below in this Section at any time after this Agreement becomes
effective as follows:

          (a)  If any domestic or international event or act or occurrence has
     materially disrupted the United States securities markets such as to make
     it, in Trident's reasonable opinion, impracticable to proceed with the
     offering of the Shares; or if trading on the New York Stock Exchange shall
     have suspended; or if the United States shall have become involved in a war
     or major hostilities; or if a general banking moratorium has been declared
<PAGE>
 
Trident Securities, Inc.
Page 27

     by a state or federal authority which has material effect on the Bank or
     the Conversion; or if a moratorium in foreign exchange trading by major
     international banks or persons has been declared; or if there shall have
     been a material change in the capitalization, condition or business of the
     Company, or if the Bank shall have sustained a material or substantial loss
     by fire, flood, accident, hurricane, earthquake, theft, sabotage or other
     calamity or malicious act, whether or not said loss shall have been
     insured; or if there shall have been a material change in the condition or
     prospects of the Company or the Bank.

          (b)  If Trident elects to terminate this Agreement as provided in this
     Section, the Company and the Bank shall be notified promptly by Trident by
     telephone or telegram, confirmed by letter.

          (c)  If this Agreement is terminated by Trident for any of the reasons
     set forth in subsection (a) above, and to fulfill its obligations, if any,
     pursuant to Sections 3, 6, 8(a) and 9 of this Agreement and upon demand,
     the Company and the Bank shall pay Trident the full amount so owing
     thereunder.

          (d)  The Bank may terminate the Conversion in accordance with the
     terms of the Plan. Such termination shall be without liability to any
     party, except that the Company and the Bank shall be required to fulfill
     their obligations pursuant to Sections 3(b), 3(c), 6, 8(a) and 9 of this
     Agreement.

     12.  Notices.  All communications hereunder, except as herein otherwise
          -------                                                           
specifically provided, shall be in writing and if sent to Trident shall be
mailed, delivered or telegraphed and confirmed to Trident Securities, Inc., 4601
Six Forks Road, Suite 400, Raleigh, North Carolina 27609, Attention: Mr. R. Lee
Burrows, Jr. (with a copy to Thacher Proffitt & Wood, 1500 K Street, N.W., Suite
200, Washington, D.C. 20005, Attention: Richard A. Schaberg, Esquire) and, if
sent to the Company or the Bank, shall be mailed, delivered or telegraphed and
confirmed to Northfield Bancorp, Inc. or Northfield Federal Savings Bank, as the
case may be, 8005 Harford Road, Baltimore, Maryland 21234, Attention Mr. G.
Ronald Dobson, President (with a copy to Housley Kantarian & Bronstein, P.C.,
1220 19/th/ Street, N.W., Washington, DC 20036, Attention: Cynthia R. Cross,
Esquire).

     13.  Parties.  This Agreement shall inure solely to the benefit of, and
          -------                                                           
shall be binding upon, Trident, the Company, the Bank and the controlling and
other persons referred to in Section 8 hereof, and their respective successors,
legal representatives and assigns, and no other person shall have or be
construed to have any legal or equitable right, remedy or claim under or in
respect of or by virtue of this Agreement or any provision herein contained.

     14.  Construction.  Unless governed by preemptive federal law, this
          ------------                                                  
Agreement shall be governed by and construed in accordance with the substantive
laws of Maryland.
<PAGE>
 
Trident Securities, Inc.
Page 28

     15.  Counterparts and Definitions.  This Agreement may be executed in
          ----------------------------                                    
separate counterparts, each of which when so executed and delivered shall be an
original, but all of which together shall constitute but one and the same
instrument.  Any initially capitalized terms not defined herein shall have the
meanings ascribed thereto in the Prospectus.


                 [Remainder of page intentionally left blank]
<PAGE>
 
Trident Securities, Inc.
Page 29

     Please acknowledge your agreement to the foregoing by signing below and
returning to the Company one copy of this letter.

NORTHFIELD BANCORP, INC.                   NORTHFIELD FEDERAL SAVINGS BANK
                              
                              
                              
By: __________________________             By: _______________________________
     G. Ronald Jobson                          G. Ronald Jobson
     President                                 President
                              
                              
Date:                                      Date:


Agreed to and accepted:

TRIDENT SECURITIES, INC.


By: __________________________
    R. Lee Burrows, Jr.

Date:

<PAGE>

                                                                     Exhibit 1.2


             [LETTERHEAD OF TRIDENT SECURITIES, INC. APPEARS HERE]


Board of Directors
Northfield Federal Savings
1844 East Joppa Road
Baltimore, Maryland 21234

RE:     Conversion Stock Marketing

Gentlemen:

     This letter sets forth the terms of the proposed engagement between TRIDENT
SECURITIES, INC. ("TRIDENT")  and Northfield Federal Savings (the "Association")
concerning our investment banking services in connection with the contemplated
conversion of the Association from a mutual to a capital stock form of
organization.

     TRIDENT is prepared to assist the Association in connection with the
offering of its shares of common stock during the subscription offering and
community offering as terms are defined in the Association's Plan of
Conversion. The specific terms of the services contemplated hereunder shall be
set forth in a definitive sales agency agreement (the "Agreement") between
TRIDENT and the Association to be executed on the date the offering
circular/prospectus is declared effective by the appropriate regulatory
authorities. The price of the shares during the subscription offering and
community offering will be the price established by the Association's Board of 
Directors, based upon an independent appraisal as approved by the appropriate 
regulatory authorities, provided such price is mutually acceptable to TRIDENT 
and the Association.

     In connection with the subscription offering and community offering, 
TRIDENT will act as financial advisor and exercise its best efforts to assist 
the Association in the sale of its common stock during the subscription offering
and community offering.  Additionally, TRIDENT may enter into agreements with 
other National Association of Securities Dealers, Inc., ("NASD") member 
firms to act as selected dealers, assisting in the sale of the common stock. 
TRIDENT and the Association will determine the selected dealers to assist the 
Association during the community offering.  At the appropriate time, TRIDENT in 
conjunction with its counsel, will conduct an examination of the relevant 
documents and records of the Association as TRIDENT deems necessary and 
appropriate.  The Association will make all documents, records and other 
information deemed necessary by TRIDENT or its counsel available to them upon 
request.

     For its services hereunder, TRIDENT will receive the following compensation
and reimbursement from the Association:









       

<PAGE>
 
TRIDENT SECURITIES, INC.


Board of Directors
October 27, 1997
Page 2

     1.   A commission equal to two percent (2.0%) of the aggregate dollar
          amount of capital stock sold in the subscription and community
          offerings, excluding any shares of conversion stock sold to the
          Association's directors, executive officers and all employee benefit
          plans. Additionally, commissions will be excluded on those shares sold
          to "associates" of the Association's directors and executors officers.
          The term "associates" as used herein shall have the same meaning as
          that found in the Association's Plan of Conversion.

     2.   For stock sold by other NASD member firms under selected dealer's
          agreements, the commission shall not exceed a fee to be agreed upon
          jointly by TRIDENT and the Association to reflect market requirements
          at the time of the stock allocation in a Syndicated Community
          Offering.

     3.   The foregoing fees and commissions are to be payable to TRIDENT at
          closing as defined in the Agreement to be entered into between the
          Association and TRIDENT.

     4.   TRIDENT shall be reimbursed for allocable expenses incurred by them,
          including legal fees, whether or not the Agreement is consummated.
          TRIDENT's out-of-pocket expenses will not exceed $10,000 and its legal
          fees will not exceed $28,000. The Association will forward to TRIDENT
          a check in the amount of $10,000 as an advance payment to defray the
          allocable expenses to TRIDENT.

     It further is understood that the Association will pay all other expenses 
of the conversion including but not limited to its attorney's fees, NASD filing 
fees, and filing and registration fees and fees of either TRIDENT's attorneys or
the attorneys relating to any required state securities law filings, telephone 
charges, air freight, rental equipment, supplies, transfer agent charges, fees 
relating to auditing and accounting and costs of printing all documents 
necessary in connection with the foregoing.

     For purposes of TRIDENT's obligation to file certain documents and to make 
certain representations to the NASD in connection with the conversion, the 
Association warrants that: (a) the Association has not privately placed any 
securities within the last 18 months; (b) there have been no material dealings 
within the last 12 months between the Association and any NASD member or any 
person related to or associated with any such member; (c) none of the officers 
or directors of the Association has any affiliation with the NASD; (d) except as
contemplated by this engagement letter with TRIDENT, the Association has no 
financial or management consulting contracts outstanding with any other person; 
(e) the Association has not granted TRIDENT a right of first refusal with 
respect to the underwriting of any future offering of the Association stock; and
(f) there has been no intermediary between TRIDENT and the Association in 
connection with the public offering of the Association's shares, and no person 
is being compensated in any manner for providing such service.

     The Association agrees to indemnify and hold harmless TRIDENT and each 
person, if any, who controls the firm against all losses, claims, damages or 
liabilities, joint or several and all legal or other expenses reasonably 
incurred by them in connection with the investigation or defense
 
<PAGE>
 
TRIDENT SECURITIES, INC.


Board of Directors
October 27, 1997
Page 3

thereof (collectively, "Losses"), to which they may become subject under the 
securities laws or under the common law, that arise out of or are based upon the
conversion or the engagement hereunder of TRIDENT.  If the foregoing 
indemnification is unavailable for any reason, the Association agrees to 
contribute to such Losses in the proportion that its financial interest in the 
conversion bears to that of the indemnified parties.  If the Agreement is 
entered into with respect to the common stock to be issued in the conversion, 
the Agreement will provide for indemnification, which will be in addition to any
rights that TRIDENT or any other indemnified party may have at common law or 
otherwise.  The indemnification provision of this paragraph will be superseded 
by the indemnification provisions of the Agreement entered into by the 
Association and TRIDENT.

     This letter is merely a statement of intent and is not a binding legal 
agreement except as to paragraph (4) above with regard to the obligation to 
reimburse TRIDENT for allocable expenses to be incurred prior to the execution 
of the Agreement and the indemnity described in the preceding paragraph.  While 
TRIDENT and the Association agree in principle to the contents hereof and 
propose to proceed promptly, and in good faith, to work out the arrangements 
with respect to the proposed offering, any legal obligations between TRIDENT and
the Association shall be only as set forth in a duly executed Agreement. Such
Agreement shall be in form and content satisfactory to TRIDENT and the
Association, as well as their counsel, and TRIDENT's obligations thereunder
shall be subject to, among other things, there being in TRIDENT's opinion no
material adverse change in the condition or obligations of the Association or no
market conditions which might render the sale of the shares by the Association
hereby contemplated inadvisable.

     Please acknowledge your agreement to the foregoing by signing below and 
returning to TRIDENT one copy of this letter along with the advance payment of 
$10,000.  This proposal is open for your acceptance for a period of thirty (30) 
days from the date hereof.

                                       Yours very truly,

                                       TRIDENT SECURITIES, INC.

                                       By:  /s/ R. Lee Burrows, Jr.
                                            ---------------------------------
                                            R. Lee Burrows, Jr.
                                            Managing Director

Agreed and accepted to this 20 day
of November, 1997

Northfield Federal Savings

By:  /s/ G. Ronald Jobson
     -----------------------------
     G. Ronald Jobson
     President

RLB/jc

<PAGE>
 
                                                                     EXHIBIT 3.1



                           ARTICLES OF INCORPORATION

                                      OF

                           NORTHFIELD BANCORP, INC.
                                        

     The undersigned, G. Ronald Jobson, whose address is 8005 Harford Road,
Baltimore, Maryland 21234, being at least 18 years of age, acting as
incorporator, does hereby form a corporation under the General Laws of the State
of Maryland having the following Articles of Incorporation:


                                   ARTICLE I

                                     Name

     The name of the corporation is Northfield Bancorp, Inc. (herein the
"Corporation").


                                  ARTICLE II

                               Principal Office

     The address of the Corporation's principal office in the State of Maryland
is 8005 Harford Road, Baltimore, Maryland 21234, or such other place as may be
designated in the bylaws of the Corporation.


                                  ARTICLE III

                                    Powers

     The purpose for which the Corporation is organized is to act as a financial
institution holding company and to transact all other lawful business for which
corporations may be incorporated pursuant to the General Laws of the State of
Maryland.  The Corporation shall have all the powers of a corporation organized
under the General Laws of the State of Maryland.


                                  ARTICLE IV

                                Resident Agent

     The name and mailing address of the initial resident agent of the
Corporation in the State of Maryland is G. Ronald Jobson, 8005 Harford Road,
Baltimore, Maryland 21234.  The resident agent is a citizen of the State of
Maryland.
<PAGE>
 
                                  ARTICLE V 

                               Initial Directors

     The number of directors constituting the initial board of directors of the
Corporation is six, which number may be increased or decreased pursuant to the
bylaws of the Corporation and Article XI of these Articles, but shall never be
less than the minimum number permitted by the General Laws of the State of
Maryland now or hereafter in force.  The names of the persons who are to serve
as directors until the first annual meeting and until their successors are
elected and qualified, are:
                                     Name
                                     ----
 
                                 Gary R. Bozel
                               J. Thomas Hoffman
                               G. Ronald Jobson
                            E. Thomas Lawrence, Jr.
                             David G. Rittenhouse
                                William R. Rush


                                  ARTICLE VI

                                 Capital Stock

     The aggregate number of shares of all classes of capital stock which the
Corporation has authority to issue is 10,000,000, of which 8,000,000 are to be
shares of common stock, $.01 par value per share, and of which 2,000,000 are to
be shares of serial preferred stock, $.01 par value per share.  The aggregate
par value of all shares of capital stock is $100,000.  The shares may be issued
by the Corporation from time to time as approved by the board of directors of
the Corporation without the approval of the stockholders except as otherwise
provided in this Article VI or to the extent that such approval is required by
governing law, rule or regulation.  The consideration for the issuance of the
shares shall be paid to or received by the Corporation in full before their
issuance and shall not be less than the par value per share.  The consideration
for the issuance of the shares, other than cash, shall be determined by the
board of directors in accordance with the General Laws of the State of Maryland.
In the absence of actual fraud in the transaction, the judgment of the board of
directors as to the value of such consideration shall be conclusive.  Upon
payment of such consideration such shares shall be deemed to be fully paid and
nonassessable.  In the case of a stock dividend or stock split, the part of the
surplus of the Corporation which is transferred to stated capital upon the
issuance of shares as a stock dividend or stock split shall be deemed to be the
consideration for their issuance.

     A description of the different classes and series (if any) of the
Corporation's capital stock, and a statement of the relative powers,
designations, preferences and rights of the shares of each class and series (if
any) of capital stock, and the qualifications, limitations or restrictions
thereof, are as follows:

     A.  Common Stock.  Except as provided in these Articles, the holders of the
         ------------                                                           
common stock shall exclusively possess all voting power.  Each holder of shares
of common stock shall be entitled to one vote for each share held by such
holder.

     Whenever there shall have been paid, or declared and set aside for payment,
to the holders of the outstanding shares of any class of stock having preference
over the common stock as to the payment of dividends, the full amount of
dividends and sinking fund or retirement fund or other retirement payments, if
any, to which such holders are respectively entitled in preference to the common
stock, then dividends may be paid on the common stock, and on any class or
series of stock entitled to participate therewith as to dividends, out of any
assets legally available for the payment of dividends, but only as declared by
the board of directors of the Corporation.

                                       2
<PAGE>
 
     In the event of any liquidation, dissolution or winding up of the
Corporation, after there shall have been paid, or declared and set aside for
payment, to the holders of the outstanding shares of any class having preference
over the common stock in any such event, the full preferential amounts to which
they are respectively entitled, the holders of the common stock and of any class
or series of stock entitled to participate therewith, in whole or in part, as to
distribution of assets shall be entitled, after payment or provision for payment
of all debts and liabilities of the Corporation, to receive the remaining assets
of the Corporation available for distribution, in cash or in kind.

     Each share of common stock shall have the same relative powers, preferences
and rights as, and shall be identical in all respects with, all the other shares
of common stock of the Corporation.

     B.  Serial Preferred Stock.  Except as provided in these Articles, the
         ----------------------                                            
board of directors of the Corporation is authorized, by resolution or
resolutions from time to time adopted, to provide for the issuance of serial
preferred stock in series and to fix and state the powers, designations,
preferences and relative, participating, optional or other special rights of the
shares of each such series, and the qualifications, limitations or restrictions
thereof, including, but not limited to determination of any of the following:

     1.  the distinctive designation and the number of shares constituting such
class or series;

     2.  the dividend rates or the amount of dividends to be paid on the shares
of such class or series, whether dividends shall be cumulative and, if so, from
which date or dates, the payment date or dates for dividends, and the
participating or other special rights, if any, with respect to dividends;

     3.  the voting powers, full or limited, if any, of the shares of such class
or series;

     4.  whether the shares of such class or series shall be redeemable and, if
so, the price or prices at which, and the terms and conditions upon which such
shares may be redeemed;

     5.  the amount or amounts payable upon the shares of such class or series
in the event of voluntary or involuntary liquidation, dissolution or winding up
of the Corporation;

     6.  whether the shares of such class or series shall be entitled to the
benefits of a sinking or retirement fund to be applied to the purchase or
redemption of such shares, and, if so entitled, the amount of such fund and the
manner of its application, including the price or prices at which such shares
may be redeemed or purchased through the application of such funds;

     7.  whether the shares of such class or series shall be convertible into,
or exchangeable for, shares of any other class or classes or any other series of
the same or any other class or classes of stock of the Corporation and, if so
convertible or exchangeable, the conversion price or prices, or the rate or
rates of exchange, and the adjustments thereof, if any, at which such conversion
or exchange may be made, and any other terms and conditions of such conversion
or exchange;

     8.  the subscription or purchase price and form of consideration for which
the shares of such class or series shall be issued;

     9.  whether the shares of such class or series which are redeemed or
converted shall have the status of authorized but unissued shares of serial
preferred stock and whether such shares may be reissued as shares of the same or
any other class or series; and

     10.  any other preferences, rights, restrictions, including restrictions on
transferability, and qualifications of shares of such class or series, not
inconsistent with law and these Articles.

                                       3
<PAGE>
 
     Each share of each series of serial preferred stock shall have the same
relative powers, preferences and rights as, and shall be identical in all
respects with, all the other shares of preferred stock of the same series.


                                  ARTICLE VII

                               Preemptive Rights

     No holder of any of the shares of any class or series of stock or of
options, warrants or other rights to purchase shares of any class or series of
stock or of other securities of the Corporation shall have any preemptive right
to purchase or subscribe for any unissued stock of any class or series, or any
unissued bonds, certificates of indebtedness, debentures or other securities
convertible into or exchangeable for stock of any class or series or carrying
any right to purchase stock of any class or series, but any such unissued stock,
bonds, certificates or indebtedness, debentures or other securities convertible
into or exchangeable for stock or carrying any right to purchase stock may be
issued pursuant to resolution of the board of directors of the Corporation to
such persons, firms, corporations or associations, whether or not holders
thereof, and upon such terms as may be deemed advisable by the board of
directors in the exercise of its sole discretion.


                                 ARTICLE VIII

                             Repurchase of Shares

     The Corporation may from time to time, pursuant to authorization by the
board of directors of the Corporation and without action by the stockholders,
purchase or otherwise acquire shares of any class, bonds, debentures, notes,
scrip, warrants, obligations, evidences of indebtedness, or other securities of
the Corporation in such manner, upon such terms, and in such amounts as the
board of directors shall determine; subject, however, to such limitations or
restrictions, if any, as are contained in the express terms of any class of
shares of the Corporation outstanding at the time of the purchase or acquisition
in question or as are imposed by law.


                                  ARTICLE IX

                  Meetings of Stockholders; Cumulative Voting

     A.  Any action required to be taken or which may be taken at any meeting of
stockholders of the Corporation may be taken without a meeting if a consent in
writing setting forth the action so taken shall be signed by all of the
stockholders entitled to vote with respect to the subject matter thereof and if
a written waiver of any right to dissent is signed by each stockholder entitled
to notice of the meeting but not entitled to vote at it.

     B.    Special meetings of the stockholders of the Corporation for any
purpose or purposes may be called at any time by the chairman of the board, by
the president, by the board of directors of the Corporation, by a committee of
the board of directors which has been duly designated by the board of directors
and whose powers and authorities, as provided in a resolution of the board of
directors or in the bylaws of the Corporation, include the power and authority
to call such meetings, or by the holders of not less than 25% of all the
outstanding shares entitled to vote on the matter for which the meeting is
called, but such special meetings may not be called by any other person or
persons.  Unless requested by stockholders entitled to cast a majority of all
the votes entitled to be cast at the meeting, a special meeting need not be
called to consider any matter which is substantially the same as a matter voted
on at any special meeting of the stockholders held during the preceding 12
months.

                                       4
<PAGE>
 
     C.    There shall be no cumulative voting by stockholders of any class or
series in the election of directors of the Corporation.

     D.    Meetings of stockholders may be held at any place within the United
States as the bylaws may provide.


                                   ARTICLE X

                     Notice for Nominations and Proposals

     A.  Nominations for the election of directors and proposals for any new
business to be taken up at any annual or special meeting of stockholders may be
made by the board of directors of the Corporation or by any stockholder of the
Corporation entitled to vote generally in the election of directors.  In order
for a stockholder of the Corporation to make any such nominations and/or
proposals, he or she shall give notice thereof in writing, delivered or mailed
by first class United States mail, postage prepaid, to the secretary of the
Corporation not less than 30 days nor more than 60 days prior to any such
meeting; provided, however, that if less than 40 days' notice of the meeting is
given to stockholders, such written notice shall be delivered or mailed, as
prescribed, to the secretary of the Corporation not later than the close of the
tenth day following the day on which notice of the meeting was mailed to
stockholders.  Each such notice given by a stockholder with respect to
nominations for the election of directors shall set forth (i) the name, age,
business address and, if known, residence address of each nominee proposed in
such notice, (ii) the principal occupation or employment of each such nominee,
and (iii) the number of shares of stock of the Corporation which are
beneficially owned by each such nominee.  In addition, the stockholder making
such nomination shall promptly provide any other information reasonably
requested by the Corporation.

     B.  Each such notice given by a stockholder to the secretary of the
Corporation with respect to business proposals to bring before a meeting shall
set forth in writing as to each matter:  (i)  a brief description of the
business desired to be brought before the meeting and the reasons for conducting
such business at the meeting; (ii)  the name and address, as they appear on the
Corporation's books, of the stockholder proposing such business; (iii)  the
class and number of shares of the Corporation which are beneficially owned by
the stockholder; and (iv)  any material interest of the stockholder in such
business.  Notwithstanding anything in these Articles to the contrary, no
business shall be conducted at the meeting except in accordance with the
procedures set forth in this Article X.

     C.  The chairman of the annual or special meeting of stockholders may, if
the facts warrant, determine and declare to such meeting that a nomination or
proposal was not made in accordance with the foregoing procedure, and, if he
should so determine, he shall so declare to the meeting and the defective
nomination or proposal shall be disregarded and laid over for action at the next
succeeding adjourned, special or annual meeting of the stockholders taking place
thirty days or more thereafter.  This provision shall not require the holding of
any adjourned or special meeting of stockholders for the purpose of considering
such defective nomination or proposal.


                                  ARTICLE XI

                                   Directors

     A.  Number; Vacancies.  The number of directors of the Corporation shall be
         -----------------                                                      
such number, not less than five nor more than fifteen (exclusive of directors,
if any, to be elected by holders of preferred stock of the Corporation, voting
separately as a class), as shall be provided from time to time in or in
accordance with the bylaws, provided that no action shall be taken to decrease
or increase the number of directors unless at least two-thirds of the directors
then in office shall concur in said action, and further provided that no
increase or decrease in the number of directors shall affect the tenure of
office of any director.  Subject to the rights of the holders of any class of
preferred stock then outstanding, newly created directorships resulting from any
increase in the authorized number of directors or any 

                                       5
<PAGE>
 
vacancies on the Board of Directors resulting from death, resignation,
retirement, disqualification, removal from office or other cause shall be filled
by a majority vote of the stockholders or the directors then in office. A
director so chosen by the stockholders shall hold office for the balance of the
term then remaining. A director so chosen by the remaining directors shall hold
office until the next annual meeting of stockholders and until his successor is
elected and qualifies, at which time the stockholders shall elect a director to
hold office for the balance of the term then remaining.

     B.  Classified Board.  At the first annual meeting of stockholders of the
         ----------------                                                     
Corporation, the board of directors of the Corporation shall be divided into
three classes as nearly equal in number as the then total number of directors
constituting the entire board of directors shall permit, which classes shall be
designated Class I, Class II and Class III.  At such annual meeting of
stockholders, directors assigned to Class I shall be elected to hold office for
a term expiring at the first succeeding annual meeting of stockholders
thereafter, directors assigned to Class II shall be elected to hold office for a
term expiring at the second succeeding annual meeting thereafter, and directors
assigned to Class III shall be elected to hold office for a term expiring at the
third succeeding annual meeting thereafter.  Thereafter, at each annual meeting
of stockholders of the Corporation, directors of classes the terms of which
expire at such annual meeting shall be elected for terms of three years.
Notwithstanding the foregoing, a director whose term shall expire at any annual
meeting shall continue to serve until such time as his successor shall have been
duly elected and shall have qualified unless his position on the board of
directors shall have been abolished by action taken to reduce the size of the
board of directors prior to said meeting.

     Should the number of directors of the Corporation be reduced, the
directorship(s) eliminated shall be allocated among classes as appropriate so
that the number of directors in each class is as specified in the immediately
preceding paragraph.  The board of directors shall designate, by the name of the
incumbent(s), the position(s) to be abolished.  Notwithstanding the foregoing,
no decrease in the number of directors shall have the effect of shortening the
term of any incumbent director.  Should the number of directors of the
Corporation be increased, the additional directorships shall be allocated among
classes as appropriate so that the number of directors in each class is as
specified in the immediately preceding paragraph.

     Whenever the holders of any one or more series of preferred stock of the
Corporation shall have the right, voting separately as a class, to elect one or
more directors of the Corporation, the board of directors shall consist of said
directors so elected in addition to the number of directors fixed as provided
above in this Article XI.  Notwithstanding the foregoing, and except as
otherwise may be required by law and provisions of the preferred stock of the
Corporation, whenever the holders of any one or more series of preferred stock
of the Corporation shall have the right, voting separately as a class, to elect
one or more directors of the Corporation, the terms of the director or directors
elected by such holders shall expire at the next succeeding annual meeting of
stockholders.


                                  ARTICLE XII

                             Removal of Directors

     Notwithstanding any other provision of these Articles or the bylaws of the
Corporation, any director or the entire board of directors of the Corporation
may be removed at any time, but only for cause and only by the affirmative vote
of the holders of at least 80% of the outstanding shares of capital stock of the
Corporation entitled to vote generally in the election of directors (considered
for this purpose as one class) cast at a meeting of the stockholders called for
that purpose.  Notwithstanding the foregoing, whenever the holders of any one or
more series of preferred stock of the Corporation shall have the right, voting
separately as a class, to elect one or more directors of the Corporation, the
preceding provisions of this Article XII shall not apply with respect to the
director or directors elected by such holders of preferred stock.

                                       6
<PAGE>
 
                                 ARTICLE XIII

                         Acquisition of Capital Stock

     A.  Five-Year Prohibition.  For a period of five years from the effective
         ---------------------                                                
date of the completion of the conversion of Northfield Federal Savings (the
"Bank") from mutual to stock form (which entity shall become a wholly owned
subsidiary of the Corporation upon such conversion), no person shall directly or
indirectly offer to acquire or acquire the beneficial ownership of more than 10%
of any class of equity security of the Corporation, unless such offer or
acquisition shall have been approved in advance by a two-thirds vote of the
Continuing Directors, as defined in Article XIV.  In addition, for a period of
five years from the completion of the conversion of the Bank from mutual to
stock form (which entity shall become a wholly owned subsidiary of the
Corporation upon such conversion), and notwithstanding any provision to the
contrary in these Articles or in the bylaws of the Corporation, where any person
directly or indirectly acquires beneficial ownership of more than 10% of any
class of equity security of the Corporation in violation of this Article XIII,
the securities beneficially owned in excess of 10% shall not be counted as
shares entitled to vote, shall not be voted by any person or counted as voting
shares in connection with any matter submitted to the stockholders for a vote,
and shall not be counted as outstanding for purposes of determining a quorum or
the affirmative vote necessary to approve any matter submitted to the
stockholders for a vote.

     B.  Prohibition after Five Years.  If, at any time after five years from
         ----------------------------                                        
the effective date of the completion of the conversion of the Bank from mutual
to stock form (which entity shall become a wholly owned subsidiary of the
Corporation upon such conversion), any person shall acquire the beneficial
ownership of more than 10% of any class of equity security of the Corporation
without the prior approval by a two-thirds vote of the Continuing Directors, as
defined in Article XIV, then the record holders of voting stock of the
Corporation beneficially owned by such acquiring person shall have only the
voting rights set forth in this paragraph B on any matter requiring the vote or
consent of shareholders.  With respect to each vote in excess of 10% of the
voting power of the outstanding shares of voting stock of the Corporation which
such record holders would otherwise be entitled to cast without giving effect to
this paragraph B, the record holders in the aggregate shall be entitled to cast
only one-hundredth of a vote, and the aggregate voting power of such record
holders, so limited for all shares of voting stock of the Corporation
beneficially owned by such acquiring person, shall be allocated proportionately
among such record holders.  For each such record holder, this allocation shall
be accomplished by multiplying the aggregate voting power, prior to imposing the
limitations of this paragraph B, of the outstanding shares of voting stock of
the Corporation beneficially owned by such record holder by a fraction whose
numerator is the number of votes equal to 10% of the shares of voting stock of
the Corporation and whose denominator is the total number of votes represented
by the shares of voting stock of the Corporation that are beneficially owned by
such acquiring person; any share held by such record holder in excess of the
allocated amount as determined in accordance with the previous clause shall be
entitled to cast one-hundredth of a vote.  A person who is a record owner of
shares of voting stock of the Corporation that are beneficially owned
simultaneously by more than one person shall have, with respect to such shares,
the right to cast the least number of votes that such person would be entitled
to cast under this paragraph B by virtue of such shares being so beneficially
owned by any of such acquiring persons.

     C.  Definitions.  The term "person" means an individual, a group acting in
         -----------                                                           
concert, a corporation, a partnership, an association, a joint stock company, a
trust, an unincorporated organization or similar company, a syndicate or any
other group acting in concert formed for the purpose of acquiring, holding,
voting or disposing of securities of the Corporation. The term "acquire"
includes every type of acquisition, whether effected by purchase, exchange,
operation of law or otherwise. The term group "acting in concert" includes (a)
knowing participation in a joint activity or conscious parallel action towards a
common goal whether or not pursuant to an express agreement, and (b) a
combination or pooling of voting or other interest in the Corporation's
outstanding shares for a common purpose, pursuant to any contract,
understanding, relationship, agreement or other arrangement, whether written or
otherwise. The term "beneficial ownership" shall have the meaning defined in
Rule 13d-3 of the General Rules and Regulations under the Securities Exchange
Act of 1934, as amended, as in effect on the date of filing of these Articles.

                                       7
<PAGE>
 
     D.  Exclusion for Employee Benefit Plans, Directors, Officers, Employees
         --------------------------------------------------------------------
and Certain Proxies.  The restrictions contained in this Article XIII shall not
- -------------------                                                            
apply to (i) any underwriter or member of an underwriting or selling group
involving a public sale or resale of securities of the Corporation or a
subsidiary thereof; provided, however, that upon completion of the sale or
resale of such securities, no such underwriter or member of such selling group
is a beneficial owner of more than 10% of any class of equity security of the
Corporation, (ii) any proxy granted to one or more Continuing Directors, as
defined in Article XIV, by a stockholder of the Corporation or (iii) any
employee benefit plans of the Corporation or a subsidiary thereof.  In addition,
the Continuing Directors of the Corporation, the officers and employees of the
Corporation and its subsidiaries, the directors of subsidiaries of the
Corporation, the employee benefit plans of the Corporation and its subsidiaries,
entities organized or established by the Corporation or any subsidiary thereof
pursuant to the terms of such plans and trustees and fiduciaries with respect to
such plans acting in such capacity shall not be deemed to be a group with
respect to their beneficial ownership of voting stock of the Corporation solely
by virtue of their being directors, officers or employees of the Corporation or
a subsidiary thereof or by virtue of the Continuing Directors of the
Corporation, the officers and employees of the Corporation and its subsidiaries
and the directors of subsidiaries of the Corporation being fiduciaries or
beneficiaries of an employee benefit plan of the Corporation or a subsidiary of
the Corporation.  Notwithstanding the foregoing, no director, officer or
employee of the Corporation or any of its subsidiaries or group of any of them
shall be exempt from the provisions of this Article XIII should any such person
or group become a beneficial owner of more than 10% of any class of equity
security of the Corporation.

     E.  Determinations.  A majority of the Continuing Directors, as defined in
         --------------                                                        
Article XIV, shall have the power to construe and apply the provisions of this
Article XIII and to make all determinations necessary or desirable to implement
such provisions, including but not limited to matters with respect to (a) the
number of shares beneficially owned by any person, (b) whether a person has an
agreement, arrangement or understanding with another as to the matters referred
to in the definition of beneficial ownership, (c) the application of any other
definition or operative provision of this Article XIII to the given facts or (d)
any other matter relating to the applicability or effect of this Article XIII.
Any constructions, applications, or determinations made by the Continuing
Directors pursuant to this Article XIII in good faith and on the basis of such
information and assistance as was then reasonably available for such purpose
shall be conclusive and binding upon the Corporation and its stockholders.


                                  ARTICLE XIV

                   Approval of Certain Business Combinations

     The stockholder vote required to approve Business Combinations (as
hereinafter defined) shall be as set forth in this section.

     A.  (1)  Except as otherwise expressly provided in this Article XIV, the
     affirmative vote of the holders of (i) at least 80% of the outstanding
     shares entitled to vote thereon (and, if any class or series of shares is
     entitled to vote thereon separately, the affirmative vote of the holders of
     at least 80% of the outstanding shares of each such class or series), and
     (ii) at least a majority of the outstanding shares entitled to vote
     thereon, not including shares deemed beneficially owned by a Related Person
     (as hereinafter defined), shall be required in order to authorize any of
     the following:

               (a) any merger, consolidation or share exchange of the
          Corporation with or into a Related Person (as hereinafter defined);

               (b) any sale, lease, exchange, mortgage, pledge, transfer or
          other disposition (in one transaction or a series of transactions) of
          all or any Substantial Part (as hereinafter defined) of the assets of
          the Corporation (including without limitation any voting securities of
          a subsidiary) or of a subsidiary, to a Related Person;

                                       8
<PAGE>
 
               (c) any merger, consolidation or share exchange of a Related
          Person with or into the Corporation or a subsidiary of the
          Corporation;

               (d) any sale, lease, exchange, mortgage, pledge, transfer or
          other disposition (in one transaction or a series of transactions) of
          all or any Substantial Part of the assets of a Related Person to the
          Corporation or a subsidiary of the Corporation;

               (e) the issuance of any securities of the Corporation or a
          subsidiary of the Corporation to a Related Person;

               (f) the acquisition by the Corporation or a subsidiary of the
          Corporation of any securities of a Related Person;

               (g) any reclassification of the common stock of the Corporation,
          or any recapitalization involving the common stock of the Corporation;
          and

               (h) any agreement, contract or other arrangement providing for
          any of the transactions described in this Article XIV.

          (2) Such affirmative vote shall be required notwithstanding any other
     provision of these Articles, any provision of law, or any agreement with
     any regulatory agency or national securities exchange or interdealer
     securities system which might otherwise permit a lesser vote or no vote.

          (3) The term "Business Combination" as used in this Article XIV shall
          mean any transaction which is referred to in any one or more of
          subparagraphs A(1)(a) through (h) above.

     B.   The provisions of paragraph A shall not be applicable to any
particular Business Combination, and such Business Combination shall require
only such affirmative vote as is required by any other provision of this
certificate, any provision of law, or any agreement with any regulatory agency
or national securities exchange or interdealer securities system, if the
Business Combination shall have been approved by a two-thirds vote of the
Continuing Directors (as hereinafter defined); provided, however, that such
approval shall only be effective if obtained at a meeting at which a Continuing
Director Quorum (as hereinafter defined) is present.

     C.   For the purposes of this Article XIV the following definitions apply:

          (1) The term "Related Person" shall mean and include (a) any
     individual, corporation, partnership or other person or entity which
     together with its "affiliates" (as that term is defined in Rule 12b-2 of
     the General Rules and Regulations under the Securities Exchange Act of
     1934, as amended), "beneficially owns" (as that term is defined in Rule
     13d-3 of the General Rules and Regulations under the Securities Exchange
     Act of 1934, as amended) in the aggregate 10% or more of the outstanding
     shares of the common stock of the Corporation; and (b) any "affiliate" (as
     that term is defined in Rule 12b-2 under the Securities Exchange Act of
     1934, as amended) of any such individual, corporation, partnership or other
     person or entity.  Without limitation, any shares of the common stock of
     the Corporation which any Related Person has the right to acquire pursuant
     to any agreement, or upon exercise or conversion rights, warrants or
     options, or otherwise, shall be deemed "beneficially owned" by such Related
     Person.

          (2) The term "Substantial Part" shall mean more than 25 percent of the
     total assets of the Corporation, as of the end of its most recent fiscal
     year ending prior to the time the determination is made.

                                       9
<PAGE>
 
          (3) The term "Continuing Director" shall mean any member of the board
     of directors of the Corporation who is unaffiliated with the Related Person
     and was a member of the board prior to the time that the Related Person
     became a Related Person, and any successor of a Continuing Director who is
     unaffiliated with the Related Person and is recommended to succeed a
     Continuing Director by a majority of Continuing Directors then on the
     board.

          (4) The term "Continuing Director Quorum" shall mean a majority of the
     Continuing Directors capable of exercising the powers conferred on them.


                                  ARTICLE XV

                      Evaluation of Business Combinations

     In connection with the exercise of its judgment in determining what is in
the best interests of the Corporation and of the stockholders, when evaluating a
Business Combination (as defined in Article XIV hereof) or a tender or exchange
offer, the board of directors of the Corporation may, in addition to considering
the adequacy of the amount to be paid in connection with any such transaction,
consider all of the following factors and any other factors which it deems
relevant; (i) the social and economic effects of the transaction on the
Corporation and its subsidiaries, employees, depositors, loan and other
customers, creditors and other elements of the communities in which the
Corporation and its subsidiaries operate or are located; (ii) the business and
financial condition and earnings prospects of the acquiring person or entity,
including, but not limited to, debt service and other existing financial
obligations, financial obligations to be incurred in connection with the
acquisition, and other likely financial obligations of the acquiring person or
entity, and the possible effect of such conditions upon the Corporation and its
subsidiaries and the other elements of the communities in which the Corporation
and its subsidiaries operate or are located; and (iii) the competence,
experience, and integrity of the acquiring person or entity and its or their
management.


                                  ARTICLE XVI

                    Limitation of Officers' and Directors' Liability

     An officer or director of the Corporation, as such, shall not be liable to
the Corporation or its stockholders for money damages, except (i) to the extent
that it is proved that the person actually received an improper benefit or
profit in money, property or services for the amount of the benefit or profit in
money, property or services actually received; (ii) to the extent that a
judgment or other final adjudication adverse to the person is entered in a
proceeding based on a finding in the proceeding that the person's action, or
failure to act, was the result of active and deliberate dishonesty and was
material to the cause of action adjudicated in the proceeding; or (iii) to the
extent otherwise required by Maryland law.  If Maryland law is amended or
enacted after the date of filing of these Articles to further eliminate or limit
the personal liability of officers and directors, then the liability of officers
and directors of the Corporation shall be eliminated or limited to the fullest
extent permitted by Maryland law, as so amended.  Any repeal or modification of
the foregoing paragraph by the stockholders of the Corporation shall not
adversely affect any right or protection of a director of the Corporation
existing at the time of such repeal or modification.

                                       10
<PAGE>
 
                                 ARTICLE XVII

                                Indemnification

     A.  The Corporation shall indemnify, to the fullest extent permissible
under the Maryland General Corporation Law, any individual who is or was a
director, officer, employee or agent of the Corporation, and any individual who
serves or served at the Corporation's request as a director, officer, partner,
trustee, employee or agent of another corporation, partnership, joint venture,
trust, other enterprise or employee benefit plan, in any proceeding in which the
individual is made a party as a result of his service in such capacity.

     B.  (1)  Reasonable expenses incurred by any person identified in paragraph
A of this Article XVII who is a party to a proceeding will be paid or reimbursed
by the Corporation in advance of the final disposition of the proceeding upon
receipt by the Corporation of:  (i) a written affirmation by such person of his
good faith belief that the standard of conduct necessary for indemnification by
the Corporation as authorized in this Article XVII has been met; and (ii) a
written undertaking by or on behalf of such person to repay the amount if it
shall ultimately be determined that the standard of conduct has not been met.

          (2) The undertaking required by subparagraph (ii) of paragraph (1) of
this subsection shall be an unlimited general obligation of such person but need
not be secured and may be accepted without reference to financial ability to
make the repayment.

     C.  Nonexclusive.  The indemnification and advance payment of expenses
         ------------                                                      
provided by paragraphs A and B shall not be exclusive of any other rights to
which a person may be entitled by law, bylaw, agreement, vote of stockholders or
disinterested directors, or otherwise.

     D.  Continuation.  The indemnification and advancement of expenses provided
         ------------                                                           
by this Article XVII shall be deemed to be a contract between the Corporation
and the persons entitled to indemnification thereunder, and any repeal or
modification of this Article XVII shall not affect any rights or obligations
then existing with respect to any state of facts then or theretofore existing or
any action, suit or proceeding theretofore or thereafter brought based in whole
or in part upon any such state of facts.  The indemnification and advance
payment provided by paragraphs A and B shall continue as to a person who has
ceased to hold a position named in paragraph A and shall inure to his heirs,
executors and administrators.

     E.  Insurance.  The Corporation shall purchase and maintain insurance on
         ---------                                                           
behalf of any person who holds or who has held any position named in paragraph
A, against any liability incurred by him in any such position, or arising out of
his status as such, whether or not the Corporation would have power to indemnify
him against such liability under paragraphs A and B.

     F.  Intention and Savings Clause.  It is the intention of this Article XVII
         ----------------------------                                           
to provide for indemnification to the fullest extent permitted by the General
Corporation Law of the State of Maryland, and this Article XVII shall be
interpreted accordingly.  If this Article XVII or any portion hereof shall be
invalidated on any ground by any court of competent jurisdiction, then the
Corporation shall nevertheless indemnify each director, officer, employee, and
agent of the Corporation as to costs, charges, and expenses (including
attorneys' fees), judgments, fines, and amounts paid in settlement with respect
to any action, suit, or proceeding, whether civil, criminal, administrative, or
investigative, including an action by or in the right of the Corporation, to the
full extent permitted by any applicable portion of this Article XVII that shall
not have been invalidated and to the full extent permitted by applicable law.
If the General Corporation Law of the State of Maryland is amended, or other
Maryland law is enacted, to permit further or additional indemnification of the
persons defined in this Article XVII.A, then the indemnification of such persons
shall be to the fullest extent permitted by the General Corporation Law of the
State of Maryland, as so amended, or such other Maryland law.

                                       11
<PAGE>
 
     Any repeal or modification of the foregoing paragraph by the stockholders
of the Corporation shall not adversely affect any right or protection of a
director of the Corporation existing at the time of such repeal or modification.


                                ARTICLE  XVIII

                              Amendment of Bylaws

     In furtherance and not in limitation of the powers conferred by statute,
the board of directors of the Corporation is expressly authorized to adopt,
repeal, alter, amend and rescind the bylaws of the Corporation by a vote of two-
thirds of the board of directors.  Notwithstanding any other provision of these
Articles or the bylaws of the Corporation (and notwithstanding the fact that
some lesser percentage may be specified by law), the bylaws shall not be
adopted, repealed, altered, amended or rescinded by the stockholders of the
Corporation except by the vote of the holders of not less than 80% of the
outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors (considered for this purpose as one
class) cast at a meeting of the stockholders called for that purpose (provided
that notice of such proposed adoption, repeal, alteration, amendment or
rescission is included in the notice of such meeting), or, as set forth above,
by the board of directors.


                                  ARTICLE XIX

                    Amendment of Articles of Incorporation

     The Corporation reserves the right to repeal, alter, amend or rescind any
provision contained in these Articles in the manner now or hereafter prescribed
by law, and all rights conferred on stockholders herein are granted subject to
this reservation.  Notwithstanding the foregoing, the provisions set forth in
Articles IX, X, XI, XII, XIII, XIV, XV, XVI, XVII, XVIII and this Article XIX of
these Articles may not be repealed, altered amended or rescinded in any respect
unless the same is approved by the affirmative vote of the holders of not less
than 80% of the outstanding shares of capital stock of the Corporation entitled
to vote generally in the election of directors (considered for this purpose as a
single class) cast at a meeting of the stockholders called for that purpose
(provided that notice of such proposed adoption, repeal, alteration, amendment
or rescission is included in the notice of such meeting); except that such
repeal, alteration, amendment or rescission may be made by the affirmative vote
of the holders of a majority of the outstanding shares of capital stock of the
Corporation entitled to vote generally in the election of directors (considered
for this purpose as a single class) if the same is first approved by a majority
of the Continuing Directors, as defined in Article XIV of these Articles.

                                       12
<PAGE>
 
     IN WITNESS WHEREOF, I have signed these articles and acknowledge the same
to be my act this 3rd day of March, 1998.



                              /s/ G. Ronald Jobson
                              -------------------------------------------
                              G. Ronald Jobson, Incorporator

                                       13

<PAGE>
 
                                                                         EXHIBIT
                                                                             3.2

                                    BYLAWS

                                      OF

                            NORTHFIELD BANCORP, INC.
                                        


                                   ARTICLE I

                               Principal Office

     The principal office of Northfield Bancorp, Inc. (herein the "Corporation")
shall be at 8005 Harford Road, Baltimore, Maryland 21234.



                                  ARTICLE II

                                 Stockholders

     SECTION 1.  Place of Meetings.  All annual and special meetings of
                 -----------------                                     
stockholders shall be held at the home office of the Corporation or at such
other place within the United States as the board of directors may determine and
as designated in the notice of such meeting.

     SECTION 2.  Annual Meeting.  A meeting of the stockholders of the
                 --------------                                       
Corporation for the election of directors and for the transaction of any other
business of the Corporation shall be held annually at such date and time within
the month of May as the board of directors may determine.

     SECTION 3.  Special Meetings.  Special meetings of the stockholders for any
                 ----------------                                               
purpose or purposes may be called at any time by the chairman of the board, by
the president, by a majority of the board of directors, by a committee of the
board of directors in accordance with the provisions of the Corporation's
Articles of Incorporation or by the secretary of the Corporation upon the
written request of the holders of not less than 25% of all votes entitled to be
cast at the meeting; provided that, unless requested by stockholders entitled to
cast a majority of all the votes entitled to be cast at a meeting, a special
meeting need not be called to consider any matter which is substantially the
same as a matter voted on at any special meeting of the stockholders held during
the preceding 12 months.  Such written request shall state the purpose or
purposes of the meeting and the matters proposed to be acted on at the meeting
and shall be delivered at the home office of the Corporation addressed to the
chairman of the board, the president or the secretary.  The secretary shall
inform the stockholders who make the request of the reasonably estimated cost of
preparing and mailing a notice of the meeting and, upon payment of these costs
to the Corporation, the secretary shall then notify each stockholder entitled to
notice of the meeting.

     SECTION 4.  Conduct of Meetings.  Annual and special meetings shall be
                 -------------------                                       
conducted in accordance with the rules and procedures established by the board
of directors. The board of directors shall designate, when present, the chairman
of the board, vice chairman of the board or president to preside at such
meetings.

     SECTION 5.  Notice of Meeting.  Written notice stating the place, day and
                 -----------------                                            
hour of the meeting and the purpose or purposes for which the meeting is called
shall be mailed by the secretary or the officer performing his duties, not less
than ten days nor more than ninety days before the meeting to each stockholder
of record entitled to vote at such meeting.  If mailed, such notice shall be
deemed to be delivered when deposited in the United States mail, addressed to
the stockholder at his address as it appears on the stock transfer books or
records of the Corporation as of the record date prescribed in Section 6 of this
Article II, with postage thereon prepaid.  If a stockholder is present in person
or by proxy at a meeting, or in writing waives notice thereof before or after
the meeting, notice of the meeting to such stockholder shall be unnecessary.
When any stockholders' meeting, either annual or special, is adjourned for
thirty days or more, notice of the adjourned meeting shall be given as in the
case of an original meeting.  It shall not be necessary to 
<PAGE>
 
give any notice of the time and place of any meeting adjourned for less than 120
days or of the business to be transacted at such adjourned meeting, other than
an announcement at the meeting at which such adjournment is taken.

     SECTION 6.  Fixing of Record Date.  For the purpose of determining
                 ---------------------                                 
stockholders entitled to notice of or to vote at any meeting of stockholders, or
any adjournment thereof, or stockholders entitled to receive payment of any
dividend, or in order to make a determination of stockholders for any other
proper purpose, the board of directors shall fix in advance a date as the record
date for any such determination of stockholders.  Such date in any case shall be
not more than ninety days, and in case of a meeting of stockholders, at least
ten days prior to the date on which the particular action, requiring such
determination of stockholders, is to be taken.  When a determination of
stockholders entitled to vote at any meeting of stockholders has been made as
provided in this section, such determination shall apply to any adjournment
thereof.

     SECTION 7.  Quorum.  A majority of the outstanding shares of the
                 ------                                              
Corporation entitled to vote, represented in person or by proxy, shall
constitute a quorum at a meeting of stockholders.  If less than a majority of
the outstanding shares are represented at a meeting, a majority of the shares so
represented may adjourn the meeting from time to time without further notice.
At such adjourned meeting at which a quorum shall be present or represented, any
business may be transacted which might have been transacted at the meeting as
originally notified.  The stockholders present at a duly organized meeting may
continue to transact business until adjournment, notwithstanding the withdrawal
of enough stockholders to leave less than a quorum.

     SECTION 8.  Proxies.  At all meetings of stockholders, a stockholder may
                 -------                                                     
vote by proxy executed in writing by the stockholder or by his duly authorized
attorney in fact.  Proxies solicited on behalf of the management shall be voted
as directed by the stockholder or, in the absence of such direction, as
determined by a majority of the board of directors.  No proxy shall be valid
after eleven months from the date of its execution unless otherwise provided in
the proxy.

     SECTION 9.  Voting.  At each election for directors every stockholder
                 ------                                                   
entitled to vote at such election shall be entitled to one vote for each share
of stock held by him.  Unless otherwise provided in the Articles of
Incorporation, by statute, or by these Bylaws, a majority of those votes cast by
stockholders at a lawful meeting shall be sufficient to pass on a transaction or
matter which properly comes before the meeting, except that a plurality of all
the votes cast at a meeting at which a quorum is present is sufficient to elect
a director.

     SECTION 10.  Voting of Shares in the Name of Two or More Persons.  When
                  ---------------------------------------------------       
ownership of stock stands in the name of two or more persons, in the absence of
written directions to the Corporation to the contrary, at any meeting of the
stockholders of the Corporation any one or more of such stockholders may cast,
in person or by proxy, all votes to which such ownership is entitled.  In the
event an attempt is made to cast conflicting votes, in person or by proxy, by
the several persons in whose name shares of stock stand, the vote or votes to
which these persons are entitled shall be cast as directed by a majority of
those holding such stock and present in person or by proxy at such meeting, but
if a majority cannot agree, then each faction may vote the stock in question
proportionally or any person voting the stock or any beneficiary may apply to a
court of competent jurisdiction to appoint an additional person to act with the
persons voting the stock and the stock shall then be voted as determined by a
majority of those persons and the person appointed by the court.

     SECTION 11.  Voting of Shares by Certain Holders.  Shares standing in the
                  -----------------------------------                         
name of another corporation may be voted by any officer, agent or proxy as the
bylaws of such corporation may prescribe, or, in the absence of such provision,
as the board of directors of such corporation may determine.  Shares held by an
administrator, executor, guardian or conservator may be voted by him, either in
person or by proxy, without a transfer of such shares into his name.  Shares
standing in the name of a trustee may be voted by him, either in person or by
proxy, but no trustee shall be entitled to vote shares held by him without a
transfer of such shares into his name.  Shares standing in the name of a
receiver may be voted by such receiver, and shares held by or under the control
of a receiver may be voted by such receiver without the transfer thereof into
his name if authority to do so is contained in an appropriate order of the court
or other public authority by which such receiver was appointed.

                                       2
<PAGE>
 
     A stockholder whose shares are pledged shall be entitled to vote such
shares until the shares have been transferred into the name of the pledgee and
thereafter the pledgee shall be entitled to vote the shares so transferred.

     Neither treasury shares of its own stock held by the Corporation, nor
shares held by another corporation, if a majority of the shares entitled to vote
for the election of directors of such other corporation are held by the
Corporation, shall be voted at any meeting or counted in determining the total
number of outstanding shares at any given time for purposes of any meeting.

     SECTION 12.  Inspectors of Election.  In advance of any meeting of
                  ----------------------                               
stockholders, the board of directors may appoint any persons, other than
nominees for office, as inspectors of election to act at such meeting or any
adjournment thereof.  The number of inspectors shall be either one or three.  If
the board of directors so appoints either one or three inspectors, that
appointment shall not be altered at the meeting.  If inspectors of election are
not so appointed, the chairman of the board or the president may make such
appointment at the meeting.  In case any person appointed as inspector fails to
appear or fails or refuses to act, the vacancy may be filled by appointment by
the board of directors in advance of the meeting or at the meeting by the
chairman of the board or the president.

     Unless otherwise prescribed by applicable law, the duties of such
inspectors shall include:  determining the number of shares of stock and the
voting power of each share, the shares of stock represented at the meeting, the
existence of a quorum, the authenticity, validity and effect of proxies;
receiving votes, ballots or consents; hearing and determining all challenges and
questions in any way arising in connection with the right to vote; counting and
tabulating all votes or consents; determining the result; and such acts as may
be proper to conduct the election or vote with fairness to all stockholders.

     SECTION 13.  Nominating Committee.  The board of directors shall act as a
                  --------------------                                        
nominating committee for selecting the management nominees for election as
directors.  Except in the case of a nominee substituted as a result of the death
or other incapacity of a management nominee, the nominating committee shall
deliver written nominations to the secretary at least twenty days prior to the
date of the annual meeting.  Provided such committee makes such nominations, no
nominations for directors except those made by the nominating committee shall be
voted upon at the annual meeting unless other nominations by stockholders are
made in writing and delivered to the secretary of the Corporation in accordance
with the provisions of the Corporation's Articles of Incorporation.

     SECTION 14.  New Business.  Any new business to be taken up at the annual
                  ------------                                                
meeting shall be stated in writing and filed with the secretary of the
Corporation in accordance with the provisions of the Corporation's Articles of
Incorporation.  This provision shall not prevent the consideration and approval
or disapproval at the annual meeting of reports of officers, directors and
committees, but in connection with such reports no new business shall be acted
upon at such annual meeting unless stated and filed as provided in the
Corporation's Articles of Incorporation.


                                  ARTICLE III

                              Board of Directors

     SECTION 1.  General Powers.  The business and affairs of the Corporation
                 --------------                                              
shall be under the direction of its board of directors.  The board of directors
shall annually elect a chairman of the board, a vice chairman of the board and a
president from among its members and shall designate, when present, either the
chairman of the board, the vice chairman of the board or the president to
preside at its meetings.

     SECTION 2.  Number, Term and Election.  The board of directors shall
                 -------------------------                               
initially consist of _____ members and thereafter shall consist of such number
of members as determined by the board of directors from time to time in
accordance with the provisions of the Corporation's Articles of Incorporation.
The board of directors shall be divided into three classes as nearly equal in
number as possible. The members of each class shall be elected for a term of
three 

                                       3
<PAGE>
 
years and until their successors are elected or qualified. The board of
directors shall be classified in accordance with the provisions of the
Corporation's Articles of Incorporation.

     SECTION 3.  Regular Meetings.  A regular meeting of the board of directors
                 ----------------                                              
shall be held generally each month at such time and place as shall be determined
by resolution of the board of directors without other notice than such
resolution.

     SECTION 4.  Special Meetings.  Special meetings of the board of directors
                 ----------------                                             
may be called by or at the request of the chairman of the board, the president,
or a majority of the directors.  The persons authorized to call special meetings
of the board of directors may fix any place as the place for holding any special
meeting of the board of directors called by such persons.

     Members of the board of directors may participate in special meetings by
means of conference telephone or similar communications equipment by which all
persons participating in the meeting can hear each other.  Such participation
shall constitute presence in person.

     SECTION 5.  Notice.  Written notice of any special meeting shall be given
                 ------                                                       
to each director at least two days previous thereto delivered personally or by
telegram or at least seven days previous thereto delivered by mail at the
address at which the director is most likely to be reached.  Such notice shall
be deemed to be delivered when deposited in the United States mail so addressed,
with postage thereon prepaid if mailed or when delivered to the telegraph
company if sent by telegram.  Any director may waive notice of any meeting by a
writing filed with the secretary.  The attendance of a director at a meeting
shall constitute a waiver of notice of such meeting, except where a director
attends a meeting for the express purpose of objecting to the transaction of any
business because the meeting is not lawfully called or convened.  Neither the
business to be transacted at, nor the purpose of, any meeting of the board of
directors need be specified in the notice or waiver of notice of such meeting.

     SECTION 6.  Quorum.  A majority of the number of directors fixed by Section
                 ------                                                         
2 of this Article III shall constitute a quorum for the transaction of business
at any meeting of the board of directors, but if less than such majority is
present at a meeting, a majority of the directors present may adjourn the
meeting from time to time.  Notice of any adjourned meeting shall be given in
the same manner as prescribed by Section 5 of this Article III.

     SECTION 7.  Manner of Acting.  The act of the majority of the directors
                 ----------------                                           
present at a meeting at which a quorum is present shall be the act of the board
of directors, unless a greater number is prescribed by these Bylaws, the
Corporation's Articles of Incorporation, or General Laws of the State of
Maryland.

     SECTION 8.  Action Without a Meeting.  Any action required or permitted to
                 ------------------------                                      
be taken by the board of directors at a meeting may be taken without a meeting
if a consent in writing, setting forth the action so taken, shall be signed by
all of the directors and filed with the minutes or proceedings of the board of
directors.

     SECTION 9.  Resignation.  Any director may resign at any time by sending a
                 -----------                                                   
written notice of such resignation to the home office of the Corporation
addressed to the chairman of the board or the president.  Unless otherwise
specified herein such resignation shall take effect upon receipt thereof by the
chairman of the board or the president.

     SECTION 10.  Vacancies.  Any vacancy occurring in the board of directors
                  ---------                                                  
shall be filled in accordance with the provisions of the Corporation's Articles
of Incorporation.  The term of such director shall be in accordance with the
provisions of the Corporation's Articles of Incorporation.

     SECTION 11.  Removal of Directors.  Any director or the entire board of
                  --------------------                                      
directors may be removed only in accordance with the provisions of the
Corporation's Articles of Incorporation.

                                       4
<PAGE>
 
     SECTION 12.  Compensation.  Directors, as such, may receive a stated salary
                  ------------                                                  
and/or fees for their services.  By resolution of the board of directors, a
reasonable fixed sum, and reasonable expenses of attendance, if any, may be
allowed for actual attendance at each regular or special meeting of the board of
directors.  Members of either standing or special committees may be allowed such
compensation for actual attendance at committee meetings as the board of
directors may determine.  Nothing herein shall be construed to preclude any
director from serving the Corporation in any other capacity and receiving
remuneration therefor.

     SECTION 13.  Presumption of Assent.  A director of the Corporation who is
                  ---------------------                                       
present at a meeting of the board of directors at which action on any corporate
matter is taken shall be presumed to have assented to the action taken unless he
announces his dissent at the meeting and (i) his dissent or abstention is
entered in the minutes of the meeting, (ii) he shall file his written dissent to
such action with the person acting as the secretary of the meeting before the
adjournment thereof or (iii) he forwards such dissent by registered mail to the
secretary of the Corporation within twenty-four hours after the adjournment of
the meeting by certified mail, return receipt requested, bearing a postmark from
the United States Postal Service.  Such right to dissent shall not apply to a
director who votes in favor of such action or fails to make his dissent known at
the meeting.

     SECTION 14.  Advisory Directors.  The board of directors may by resolution
                  ------------------                                           
appoint advisory directors to the board, who may also serve as directors
emeriti, and shall have such authority and receive such compensation and
reimbursement as the board of directors shall provide.  Advisory directors or
directors emeriti shall not have the authority to participate by vote in the
transaction of business.

     SECTION 15.  Age Limitation.  (a) No person seventy (70) years of age shall
                  --------------                                                
be eligible for election, reelection, appointment, or reappointment to the board
of directors.  No person shall serve as a director beyond the annual meeting of
the Corporation immediately following the director becoming age seventy (70),
except that a director serving on the date of the adoption of the bylaws of
Northfield Federal Savings may complete the term as director.  This age
limitation does not apply to an advisory director.

     (b) The age limitation contained in these Bylaws shall not be applicable to
any director holding office on the date of the adoption of the Bylaws of
Northfield Federal Savings.


                                  ARTICLE IV

                     Committees of the Board of Directors

     The board of directors may, by resolution passed by a majority of the whole
board, designate one or more committees, as they may determine to be necessary
or appropriate for the conduct of the business of the Corporation, and may
prescribe the duties, constitution and procedures thereof.  Each committee shall
consist of one or more directors or officers of the Corporation.  The board may
designate one or more directors or officers as alternate members  of any
committee, who may replace any absent or disqualified member at any meeting of
the committee.

     The board of directors shall have power, by the affirmative vote of a
majority of the authorized number of directors, at any time to change the
members of, to fill vacancies in, and to discharge any committee of the board.
Any member of any such committee may resign at any time by giving notice to the
Corporation; provided, however, that notice to the board, the chairman of the
board, the chief executive officer, the chairman of such committee, or the
secretary shall be deemed to constitute notice to the Corporation.  Such
resignation shall take effect upon receipt of such notice or at any later time
specified therein; and, unless otherwise specified therein, acceptance of such
resignation shall not be necessary to make it effective.  Any member of any such
committee may be removed at any time, either with or without cause, by the
affirmative vote of a majority of the authorized number of directors at any
meeting of the board called for that purpose.

                                       5
<PAGE>
 
                                   ARTICLE V

                                   Officers

     SECTION 1.  Positions.  The officers of the Corporation shall be a
                 ---------                                             
chairman, a vice chairman, a president, one or more vice presidents, a
secretary, an assistant secretary and a treasurer, each of whom shall be elected
by the board of directors.  The board of directors may designate one or more
vice presidents as executive vice president or senior vice president.  The board
of directors may also elect or authorize the appointment of such other officers
as the business of the Corporation may require.  The officers shall have such
authority and perform such duties as the board of directors may from time to
time authorize or determine.  In the absence of action by the board of
directors, the officers shall have such powers and duties as generally pertain
to their respective offices.

     SECTION 2.  Election and Term of Office.  The officers of the Corporation
                 ---------------------------                                  
shall be elected annually by the board of directors at the first meeting of the
board of directors held after each annual meeting of the stockholders.  If the
election of officers is not held at such meeting, such election shall be held as
soon thereafter as possible.  Each officer shall hold office until his successor
shall have been duly elected and qualified or until his death or until he shall
resign or shall have been removed in the manner hereinafter provided.  Election
or appointment of an officer, employee or agent shall not of itself create
contract rights.  The board of directors may authorize the Corporation to enter
into an employment contract with any officer in accordance with state law; but
no such contract shall impair the right of the board of directors to remove any
officer at any time in accordance with Section 3 of this Article V.

     SECTION 3.  Removal.  Any officer may be removed by vote of two-thirds of
                 -------                                                      
the board of directors whenever, in its judgment, the best interests of the
Corporation will be served thereby, but such removal, other than for cause,
shall be without prejudice to the contract rights, if any, of the person so
removed.

     SECTION 4.  Vacancies.  A vacancy in any office because of death,
                 ---------                                            
resignation, removal, disqualification or otherwise, may be filled by the board
of directors for the unexpired portion of the term.

     SECTION 5.  Remuneration.  The remuneration of the officers shall be fixed
                 ------------                                                  
from time to time by the board of directors and no officer shall be prevented
from receiving such salary by reason of the fact that he is also a director of
the Corporation.

     SECTION 6.  Age Limitation.  No person seventy (70) years of age shall be
                 --------------                                               
eligible for election, reelection, appointment, or reappointment as an officer
of the Corporation.  No officer shall serve beyond the annual meeting of the
Corporation immediately following the officer becoming age seventy (70), except
that an officer serving on the date of the adoption of the bylaws of Northfield
Federal Savings may complete the term.


                                  ARTICLE VI

                     Contracts, Loans, Checks and Deposits

     SECTION 1.  Contracts.  To the extent permitted by applicable law, and
                 ---------                                                 
except as otherwise prescribed by the Corporation's Articles of Incorporation or
these Bylaws with respect to certificates for shares, the board of directors may
authorize any officer, employee, or agent of the Corporation to enter into any
contract or execute and deliver any instrument in the name of and on behalf of
the Corporation.  Such authority may be general or confined to specific
instances.

     SECTION 2.  Loans.  No indebtedness shall be contracted on behalf of the
                 -----                                                       
Corporation and no evidence of indebtedness shall be issued in its name unless
authorized by the board of directors.  Such authority may be general or confined
to specific instances.

                                       6
<PAGE>
 
     SECTION 3.  Checks, Drafts, Etc.  All checks, drafts or other orders for
                 -------------------                                         
the payment of money, notes or other evidences of indebtedness issued in the
name of the Corporation shall be signed by one or more officers, employees or
agents of the Corporation in such manner as shall from time to time be
determined by resolution of the board of directors.

     SECTION 4.  Deposits.  All funds of the Corporation not otherwise employed
                 --------                                                      
shall be deposited from time to time to the credit of the Corporation in any of
its duly authorized depositories as the board of directors may select.


                                  ARTICLE VII

                  Certificates for Shares and Their Transfer

     SECTION 1.  Certificates for Shares.  The shares of the Corporation shall
                 -----------------------                                      
be represented by certificates signed by the chairman of the board of directors
or by the president or a vice president and by the treasurer or an assistant
treasurer or by the secretary or an assistant secretary of the Corporation, and
may be sealed with the seal of the Corporation or a facsimile thereof.  Any or
all of the signatures upon a certificate may be facsimiles if the certificate is
countersigned by a transfer agent, or registered by a registrar, other than the
Corporation itself of an employee of the Corporation.  If any officer who has
signed or whose facsimile signature has been placed upon such certificate shall
have ceased to be such officer before the certificate is issued, it may be
issued by the Corporation with the same effect as if he were such officer at the
date of its issue.

     SECTION 2.  Form of Share Certificates.  All certificates representing
                 --------------------------                                
shares issued by the Corporation shall set forth upon the face or back that the
Corporation will furnish to any stockholder upon request and without charge a
full statement of the designations and any preferences, conversion and other
rights, voting powers, restrictions, limitations as to dividends, qualifications
and terms and conditions of redemption of the shares of each class authorized to
be issued, the differences in the relative rights and preferences between the
shares of each such series so far as the same have been fixed and determined,
and the authority of the board of directors to fix and determine the relative
rights and preferences of subsequent series.

     Each certificate representing shares shall state upon the face thereof:
the name of the Corporation; that the Corporation is organized under the laws of
the State of Maryland; the name of the person to whom issued; the number and
class of shares; the date of issue; the designation of the series, if any, which
such certificate represents; the par value of each share represented by such
certificate, or a statement that the shares are without par value.  Other
matters in regard to the form of the certificates shall be determined by the
board of directors.

     SECTION 3.  Payment for Shares.  No certificate shall be issued for any
                 ------------------                                         
share until such share is fully paid.

     SECTION 4.  Form of Payment for Shares.  The consideration for the issuance
                 --------------------------                                     
of shares shall be paid in accordance with the provisions of the Corporation's
Articles of Incorporation.

     SECTION 5.  Transfer of Shares.  Transfer of shares of capital stock of the
                 ------------------                                             
Corporation shall be made only on its stock transfer books.  Authority for such
transfer shall be given only by the holder of record thereof or by his legal
representative, who shall furnish proper evidence of such authority, or by his
attorney thereunto authorized by power of attorney duly executed and filed with
the Corporation.  Such transfer shall be made only on surrender for cancellation
of the certificate for such shares. The person in whose name shares of capital
stock stand on the books of the Corporation shall be deemed by the Corporation
to be the owner thereof for all purposes.

     SECTION 6.  Stock Ledger.  The stock ledger of the Corporation shall be the
                 ------------                                                   
only evidence as to who are the stockholders entitled to examine the stock
ledger or the books of the Corporation or to vote in person or by proxy at any
meeting of stockholders.

                                       7
<PAGE>
 
     SECTION 7.  Lost Certificates.  The board of directors may direct a new
                 -----------------                                          
certificate to be issued in place of any certificate theretofore issued by the
Corporation alleged to have been lost, stolen, or destroyed, upon the making of
an affidavit of that fact by the person claiming the certificate of stock to be
lost, stolen, or destroyed.  When authorizing such issue of a new certificate,
the board of directors may, in its discretion and as a condition precedent to
the issuance thereof, require the owner of such lost, stolen, or destroyed
certificate, or his legal representative, to give the Corporation a bond in such
sum as it may direct as indemnity against any claim that may be made against the
Corporation with respect to the certificate alleged to have been lost, stolen,
or destroyed.

     SECTION 8.  Beneficial Owners.  The Corporation shall be entitled to
                 -----------------                                       
recognize the exclusive right of a person registered on its books as the owner
of shares to receive dividends, and to vote as such owner, and shall not be
bound to recognize any equitable or other claim to or interest in such shares on
the part of any other person, whether or not the Corporation shall have express
or other notice thereof, except as otherwise provided by law.


                                 ARTICLE VIII

                           Fiscal Year; Annual Audit

     The fiscal year of the Corporation shall end on the 31st day of December of
each year.  The Corporation shall be subject to an annual audit as of the end of
its fiscal year by independent public accountants appointed by and responsible
to the board of directors.


                                  ARTICLE IX

                                   Dividends

     Subject to the provisions of the Corporation's Articles of Incorporation
and applicable law, the board of directors may, at any regular or special
meeting, declare dividends on the Corporation's outstanding capital stock.
Dividends may be paid in cash, in property or in the Corporation's own stock.


                                   ARTICLE X

                                Corporate Seal

     The corporate seal of the Corporation shall be in such form as the board of
directors shall prescribe.


                                  ARTICLE XI

                                  Amendments

     In accordance with the Corporation's Articles of Incorporation, these
Bylaws may be repealed, altered, amended or rescinded by the stockholders of the
Corporation only by vote of not less than 80% of the outstanding shares of
capital stock of the Corporation entitled to vote generally in the election of
directors (considered for this purpose as one class) cast at a meeting of the
stockholders called for that purpose (provided that notice of such proposed
repeal, alteration, amendment or rescission is included in the notice of such
meeting).  In addition, the board of directors may repeal, alter, amend or
rescind these Bylaws by vote of two-thirds of the board of directors at a legal
meeting held in accordance with the provisions of these Bylaws.

                                       8

<PAGE>
 
                                                                       EXHIBIT 4

                                 COMMON STOCK

NUMBER                                                                    SHARES
       ------                                                      ------

                           NORTHFIELD BANCORP, INC.
                              BALTIMORE, MARYLAND



This certifies that


is the owner of

            fully paid and non-assessable shares of common stock, 
                         par value $0.01 per share, of



Northfield Bancorp, Inc. (the "Corporation"), a Maryland corporation.  The
shares represented by this certificate are transferable only on the stock
transfer books of the Corporation by the holder of record hereof, or by his duly
authorized attorney or legal representative upon the surrender of this
certificate properly endorsed.  This certificate is not valid until
countersigned and registered by the Corporation's transfer agent and registrar.



IN WITNESS WHEREOF, the Corporation has caused this certificate to be executed
by the facsimile signature of its duly authorized officers and has caused a
facsimile of its corporate seal to be hereunto affixed.



- ----------------------------------         -------------------------------------
J. Thomas Hoffman                          G. Ronald Jobson
Secretary                                  President


Countersigned and Registered:

                                    (SEAL)

     -----------------------------
     Transfer Agent and Registrar

BY:  
     -----------------------------
     Authorized Signature


               SEE REVERSE FOR CERTAIN RESTRICTIONS ON TRANSFER
<PAGE>
 
                     FORM OF STOCK CERTIFICATE - BACK SIDE

     The shares represented by this certificate are issued subject to all the
provisions of the Articles of Incorporation and Bylaws of the Corporation as
from time to time amended (copies of which are on file at the principal
executive office of the Corporation), to all of which the holder by acceptance
hereof assents.

     The Corporation will furnish without charge to each stockholder who so
requests, the powers, designations, preferences and relative participating,
optional or other special rights of each class of stock or series thereof, and
the qualifications, limitations or restrictions of such preferences and/or
rights.  Such request may be made in writing to the Secretary of the
Corporation.

     The Corporation's Articles of Incorporation include a provision which
prohibits any person from directly or indirectly acquiring the beneficial
ownership of more than 10% of any class of equity security of the Corporation,
unless such offer or acquisition shall have been approved in advance by a two-
thirds vote of the Continuing Directors of the Corporation, as defined in
Article XIV of the Articles of Incorporation. This provision does not apply to
the purchase of shares by underwriters in connection with a public offering, the
granting of proxies to certain directors of the Corporation by stockholders of
the Corporation or the acquisition of shares by an employee benefit plan of the
Corporation or a subsidiary.   Such provision eliminates the voting rights of
securities acquired in violation of the provision.  Such provision will expire
five years from the date of completion of the conversion of Northfield Federal
Savings, Baltimore, Maryland (the "Bank") from mutual to stock form.  The
Articles of Incorporation also impose certain restrictions on the voting rights
of beneficial owners of more than 10% of any class of equity security of the
Corporation after five years from the date of completion of the conversion of
the Bank from mutual to stock form.

          The following abbreviations, when used in the inscription on the face
of this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations.

TEN COM - as tenants in common

TEN ENT - as tenants by the entireties

JT TEN  - as joint tenants with right of survivorship and not as tenants in
          common
<TABLE> 
<S>                                   <C>                     <C> 
UNIF TRANSFER MIN ACT - ..............Custodian.............. under Uniform Transfers to Minors Act.......................
                                                   (Cust)           (Minor)                                        (State)
</TABLE> 

    Additional abbreviations may also be used though not in the above list.

NOTE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME OF THE
STOCKHOLDER(S) AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.


     For value received, ---------------------------------- hereby sell, assign
and transfer unto


PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- -----------------------------------
/                                  /
- ----------------------------------- 

- -------------------------------------------------------
 (PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)


- -------------------------------------------------------

                                                 Shares
- -------------------------------------------------

of the common stock evidenced by this certificate, and do hereby irrevocably

constitute and appoint                                   , Attorney, to transfer
                       ----------------------------------
the said shares on the books of the Corporation, with full power of

substitution.

Dated 
      ---------------------


                                       -----------------------------------------
                                       Signature                               



                                       -----------------------------------------
                                       Signature                               


In presence of: 
                -----------------------------------------------

<PAGE>
 
                                                                       EXHIBIT 5



                                 March 25, 1998



Board of Directors
Northfield Bancorp, Inc.
8005 Harford Road
Baltimore, Maryland  21234

     RE:  Registration Statement on Form SB-2

Gentlemen:

     You have requested our opinion as special counsel to Northfield Bancorp,
Inc. (the "Company"), in connection with the Registration Statement on Form SB-2
to be filed with the Securities and Exchange Commission under the Securities Act
of 1933, as amended (the "Registration Statement").  The Registration Statement
relates to shares of common stock of the Company (the "Common Stock") to be
issued in connection with the simultaneous conversion of Northfield Federal
Savings  (the "Association") from a federal mutual savings association to a
federal capital stock savings bank, with the name "Northfield Federal Savings
Bank" (the "Bank"), and reorganization into the holding company form of
ownership with the Bank becoming a wholly owned subsidiary of the Company.

     In rendering this opinion, we understand that the Common Stock will be
offered and sold in the manner described in the Prospectus which is a part of
the Registration Statement.  We have examined such records and documents and
made such examination as we have deemed relevant in connection with this
opinion.

     Based upon the foregoing, it is our opinion that the shares of Common Stock
will, when issued and sold as contemplated by the Registration Statement, be
legally issued, fully paid and nonassessable.

     We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to us in the Prospectus under the
heading "Legal and Tax Matters."

                         HOUSLEY KANTARIAN & BRONSTEIN, P.C.



                         By:/s/ Cynthia R. Cross
                            -------------------------------- 
                            Cynthia R. Cross

<PAGE>
 
                                                                     EXHIBIT 8.1

                               ___________, 1998

Board of Directors
Northfield Federal Savings
8005 Harford Road
Baltimore, Maryland 21234


Re:  Certain Federal Income Tax Consequences Relating to Proposed Holding 
     Company Conversion
     --------------------------------------------------------------------

Gentlemen:

     In accordance with your request, set forth hereinbelow is the opinion of 
this firm relating to certain federal income tax consequences of the proposed 
conversion of Northfield Federal Savings (the "Association") from a federally 
chartered mutual savings association to federally chartered capital stock 
savings bank with the name "Northfield Federal Savings Bank" (the "Converted 
Bank") and the concurrent acquisition of 100% of the outstanding capital stock 
of the Converted Bank by Northfield Bancorp, Inc. (the "Company"), a Maryland 
corporation formed at the direction of the Board of Directors of the Association
to become the parent holding company of the Converted Bank (the "Conversion").

     For purposes of this opinion, we have examined such documents and questions
of law as we have considered necessary or appropriate, including but not limited
to the Plan of Conversion as adopted on December 17, 1997 by the Board of 
Directors of the Association (the "Plan"); the federal mutual charter and bylaws
of the Association, as amended; the federal stock charter and bylaws of the 
Converted Bank; the articles of incorporation and bylaws of the Company; the 
Affidavit of Representations dated _________, 1998 provided to us by the 
Association (the "Affidavit"), and the Prospectus (the "Prospectus") included in
the Company's Registration
<PAGE>
 
Board of Directors
Northfield Federal Savings
__________, 1998
Page 2


Statement on Form SB-2 filed with the Securities and Exchange Commission ("SEC")
in connection with the Conversion on March __, 1998 (the "Registration 
Statement"). In such examination, we have assumed, and have not independently 
verified, the genuineness of all signatures on original documents where due 
execution and delivery are requirements to the effectiveness thereof. Terms used
but not defined herein, whether capitalized or not, shall have the same meaning
as defined in the Plan.


                                  BACKGROUND
                                  ----------

     Based solely upon our review of such documents, and upon such information 
as the Association has provided to us (which we have not attempted to verify in 
any respect), and in reliance upon such documents and information, we set forth 
hereinbelow a general summary of the relevant facts and proposed transaction, 
qualified in its entirety by reference to the documents cited above.

     The Association is a federally chartered mutual savings association, which 
is in the process of converting to a federally chartered capital stock savings 
bank. The Association was organized as a federally chartered mutual savings 
institution in 1923.

     The Association is a member of the FHLB System, and the deposits of the 
Association are insured by the Federal Deposit Insurance Corporation ("FDIC") up
to applicable limits. The Association is subject to comprehensive regulation and
supervision by the Office of Thrift Supervision ("OTS") and to examination by 
the OTS. The Association operates two offices in Baltimore County, Maryland.

     The Association's principal business consists of attracting deposits,
primarily certificates of deposit, from the general public and originating 
residential mortgage loans, primarily construction/permanent loans on one- to 
four-family properties. The Association also offers commercial real estate and 
limited types of consumer loans. The Association also has a portfolio of 
purchased commercial leases. At December 31, 1997, the Association had total 
assets of $36.1 million, deposits of $32.6 million and retained earnings of $2.9
million.

     As a federally chartered mutual savings association, the Association has no
authorized capital stock. Instead, the Association, in mutual form, has a unique
equity structure. A savings


         
<PAGE>
 
Board of Directors
Northfield Federal Savings
_____________, 1998
Page 3


depositor of the Association is entitled to payment of interest on his account 
balance as declared and paid by the Association, but has no right to a 
distribution of any earnings of the Association except for interest paid on his 
deposit. Rather, such earnings become retained income of the Association.

     However, a savings depositor does have a right to share pro rata, with 
                                                             --- ----
respect to the withdrawal value of his respective savings account, in any 
liquidation proceeds distributed if the Association is ever liquidated. 
Further, savings depositors and borrowers are members of the Association and 
thereby have voting rights in the Association. Under the Association's federal 
mutual charter, each depositor is entitled to cast one vote for each $100 or
fraction thereof held in a withdrawable deposit account of the Association, and
each borrower member (hereinafter "borrower") is entitled to one vote in
addition to the votes (if any) to which such person is entitled in such
borrower's capacity as a savings depositor of the Association. Also under such
federal mutual charter, no member is entitled to cast more than 1,000 votes. All
of the interests held by a savings depositor in the Association cease when such
depositor closes his accounts with the Association.

     The Company was incorporated on March 5, 1998 under the laws of the State 
of Maryland to act as the savings and loan holding company of the Converted Bank
upon consummation of the Conversion. Prior to consummation of the Conversion,
the Company has not been engaged in and is not expected to engage in any
material operations. After the Conversion, the Company's principal business will
be overseeing the business of the Converted Bank. The Company has authorized
capital stock of $8,000,000 shares of common stock (the "Common Stock"), par
value $.01 per share, and 2,000,000 shares of serial preferred stock, par value
$.01 per share.

                             PROPOSED TRANSACTION
                             --------------------

     The Board of Directors of the Association has decided that in order to 
attract new capital to the Converted Bank to increase its net worth, to support 
future savings growth, to increase the amount of funds available for lending 
and investment, to provide greater resources for the expansion of customer 
services, and to facilitate future expansion, it would be advantageous for the
Association to convert from a federally chartered mutual savings association to
a federally chartered capital stock savings bank. In addition, the Board of
Directors intends to implement stock option plans and other stock benefit plans
following the Conversion in order to better attract
<PAGE>

Board of Directors
Northfield Federal Savings
_________, 1998
Page 4 

and retain qualified directors and officers. It is the further desire of the 
Board of Directors to reorganize the Converted Bank as the wholly owned 
subsidiary of the Company to enhance flexibility of operations, diversification 
of business opportunities and financial capability for business and regulatory
purposes and to enable the Converted Bank to compete more effectively with other
financial service organizations.

     Accordingly, pursuant to the Plan, the Association will undergo the
Conversion whereby it will be converted from a federally chartered mutual 
savings association to a federally chartered capital stock savings bank. The
Converted Bank will then issue to the Company 100,000 shares of the Converted
Bank's common stock, representing all of the shares of capital stock to be
issued by the Converted Bank in the conversion, and the Company will make
payment to the Converted Bank in an amount equal to at least 50% of the
aggregate net proceeds realized by the Company from the sale of its Common Stock
sold pursuant to the Plan, after deducting the amount necessary to fund a loan
to an Employee Stock Ownership Plan being established in connection with the
Conversion, or such other portion of the aggregate net proceeds as may be
authorized or required by the OTS. Pursuant to the Prospectus, the Company
currently anticipates making such payment to the Converted Bank of an amount
equal to 50% of the aggregate net proceeds from the sale of the Common Stock.

     Also pursuant to the Plan, the Company will offer its shares of Common 
Stock for sale in a Subscription Offering. Shares of Common Stock remaining, if 
any, may then be offered to the general public in a Community Offering. Shares 
of the Common Stock not otherwise subscribed for in the Subscription Offering
and Community Offering may be offered at the discretion of the Company to
certain members of the general public as part of a community offering on a best
efforts basis by a selling group of selected broker-dealers.

     The purchase price per share and total number of shares of Common Stock to 
be offered and sold pursuant to the Plan will be determined by the Boards of 
Directors of the Association and the Company, on the basis of the estimated pro
                                                                            ---
forma market value of the Converted Bank, as a subsidiary of the Company, which 
- -----
will in turn be determined by an independent appraiser. The aggregate purchase
price for all shares of the Common Stock will be equal to such estimated pro
                                                                         ---
forma market value. Pursuant to the Plan, all such shares of Common Stock will
- -----
be issued and sold at a uniform price per share. The Conversion, including the
sale of newly issued shares of
<PAGE>
 
Board of Directors
Northfield Federal Savings
_______, 1998
Page 5

the stock of the Converted Bank to the Company, will be deemed effective 
concurrently with the closing of the sale of the Common Stock.

     Under the Plan and in accordance with regulations of the OTS, the shares of
Common Stock will first be offered through the Subscription Offering pursuant to
non-transferable subscription rights on the basis of preference categories in
the following order of priority:

     (1)  Eligible Account Holders;

     (2)  Tax-Qualified Employee Stock Benefit Plans (i.e. the ESOP);

     (3)  Supplemental Eligible Account Holders; and

     (4)  Other Members.            

     However, any shares of Common Stock sold in excess of the high-end of the
Valuation Range may first be sold to Tax-Qualified Employee Stock Benefit Plans
set forth in category (2) above.

     Any shares of Common Stock not subscribed for in the Subscription Offering 
will be offered in the Community Offering in the following order of priority:

     (a)  Natural persons and trusts of natural persons (including individual
          retirement and Keogh retirement accounts and personal trusts in which
          such natural persons have substantial interests) who are permanent
          Residents of the Association's Local Community, Baltimore County,
          Maryland; and

     (b)  The general public.

     Shares not sold in the Subscription Offering and the Community Offering, if
any, may thereafter be offered for sale to certain members of the general public
as part of a community offering on a best efforts basis by a selling group of
selected broker-dealers. The sale of shares in the Subscription Offering,
Community Offering, and as sold through the selected broker-dealers would be
consummated at the same time.
<PAGE>
 
Board of Directors
Northfield Federal Savings
________, 1998
Page 6

     The Plan also provides for the establishment of a Liquidation Account by 
the Converted Bank for the benefit of all Eligible Account Holders and 
Supplemental Eligible Account Holders in an amount equal to the regulatory
capital of the Association as of the date of the latest statement of financial
condition contained in the final prospectus issued in connection with the
Conversion. The establishment of the Liquidation Account will not operate to
restrict the use or application of any of the net worth accounts of the
Converted Bank, except that the Converted Bank may not declare or pay cash
dividends on or repurchase any of its stock if the result thereof would be to
reduce its regulatory capital below the amount required to maintain the
Liquidation Account. All such account holders will have an inchoate interest in
a proportionate amount of the Liquidation Account with respect to each savings
account held and will be paid by the Converted Bank in event of liquidation
prior to any liquidating distribution being made with respect to capital stock.
Under the Plan, the Conversion shall not be deemed to be a liquidation of the
Association for purposes of distribution of the Liquidation Account. Instead,
upon consummation of the Conversion, the Liquidation Account, together with the
related rights and obligations of the Converted Bank, shall be assumed by the
Converted Bank.

     The Conversion will not interrupt the business of the Association. The 
Converted Bank will, after the Conversion, engage in the same business as that 
of the Association immediately prior to the Conversion, and will continue to 
be subject to regulation and supervision by the OTS. Further, the deposits of 
the Converted Bank will continue to be insured by the FDIC. Each depositor 
will retain a withdrawable savings account or accounts equal in dollar amount 
to, and on the same terms and conditions as, the withdrawable account or 
accounts at the time of Conversion except to the extent funds on deposit are 
used to pay for Common Stock purchased in connection with the Conversion. All 
loans of the Association will remain unchanged and retain their same 
characteristics in the Converted Bank immediately following the Conversion.

     Following the Conversion, voting rights in the Converted Bank will rest 
exclusively with the sole holder of stock in the Converted Bank, which will be 
the Company. Voting rights in the Company will rest exclusively in the holders 
of the Common Stock.

     The Plan must be approved by the OTS and by an affirmative vote of at least
a majority of the total votes eligible to be cast at a meeting of the
Association's members called to vote on the Plan. Immediately prior to the
Conversion, the Association will have a positive net worth determined in
accordance with generally accepted accounting principles.
<PAGE>
 
Board of Directors
Northfield Federal Savings
_____________, 1998
Page 7


                                    OPINION
                                    -------

     Based on the foregoing and in reliance thereon, and subject to the
conditions stated herein, it is our opinion that the following federal income 
tax consequences will result from the proposed transaction.

     1.   The Conversion will constitute a reorganization within the meaning of
          Section 368(a)(1)(F) of the Internal Revenue Code of 1986, as amended
          (the "Code"), and no gain or loss will be recognized to either the
          Association or the Converted Bank as a result of the Conversion (see
                                                                           ---
          Rev. Rul. 80-105, 1980-1 C.B. 78).

     2.   The assets of the Association will have the same basis in the hands of
          the Converted Bank as in the hands of the Association immediately
          prior to the Conversion (Section 362(b) of the Code).

     3.   The holding period of the assets of the Association to be received by
          the Converted Bank will include the period during which the assets
          were held by the Association prior to the Conversion (Section 1223(2)
          of the Code).

     4.   No gain or loss will be recognized by the Converted Bank upon its
          receipt of money from the Company in exchange for shares of common
          stock of the Converted Bank (Section 1032(a) of the Code). The Company
          will be transferring solely cash to the Converted Bank in exchange for
          all the outstanding capital stock of the Converted Bank and therefore
          will not recognize any gain or loss upon such transfer. (Section
          351(a) of the Code; see Rev. Rul. 69-357, 1969-1 C.B. 101).
                              --- 

     5.   No gain or loss will be recognized by the Company upon its receipt of
          money in exchange for shares of the Common Stock (Section 1032(a) of
          the Code).

     6.   No gain or loss will be recognized by the Eligible Account Holders,
          Supplemental Eligible Account Holders, or Other Members of the
          Association upon the issuance to them of deposit accounts in the
          Converted Bank in the same dollar amount and on the same terms and
          conditions in exchange for their deposit accounts in the
<PAGE>
 
Board of Directors
Northfield Federal Savings
________, 1998
Page 8


          Association held immediately prior to the Conversion. (Section 1001(a)
          of the Code; Treas. Reg. (S)1.1001-1(a)).

     7.   The tax basis of the savings accounts of the Eligible Account Holders,
          Supplemental Eligible Account Holders, and Other Members in the
          Converted Bank received as part of the Conversion will equal the tax
          basis of such account holders' corresponding deposit accounts in the
          Association surrendered in exchange therefor (Section 1012 of the
          Code).

     8.   Each depositor of the Association will recognize gain upon the receipt
          of his or her respective interest in the Liquidation Account
          established by the Converted Bank pursuant to the Plan and the receipt
          of his or her subscription rights deemed to have been received for
          federal income tax purposes, but only to the extent of the excess of
          the combined fair market value of a depositor's interest in such
          Liquidation Account and subscription rights over the depositor's basis
          in the former interests in the Association other than deposit
          accounts. Person who subscribe in the Conversion but who are not
          depositors of the Association will recognize gain upon the receipt of
          subscription rights deemed to have been received for federal income
          tax purposes, but only to the extent of the excess of the fair market
          value of such subscription rights over such person's former interests
          in the Association, if any. Any such gain realized in the Conversion
          would be subject to immediate recognition.

     9.   The basis of each account holder's interest in the Liquidation Account
          received in the Conversion and to be established by the Converted Bank
          pursuant to the Conversion will be equal to the value, if any, of that
          interest.

     10.  No gain or loss will be recognized upon the exercise of a subscription
          right in the Conversion. (Rev, Rul. 56-572, 1956-2 C.B.182).

     11.  The basis of the shares of Common Stock acquired in the Conversion
          will be equal to the purchase price of such shares, increased, in the
          case of such shares acquired pursuant to the exercise of subscription
          rights, by the fair market value, if any, of the subscription rights
          exercised (Section 1012 of the Code).
<PAGE>
 
Board of Directors
Northfield Federal Savings
________, 1998
Page 9


     12.  The holding period of the Common Stock acquired in the Conversion
          pursuant to the exercise of subscription rights will commence on the
          date on which the subscription rights are exercised (Section 1223(6)
          of the Code. The holding period of the Common Stock acquired in the
          Community Offering will commence on the date following the date on
          which such stock is purchased (Rev. Rul. 70-598, 1970-2 C.B. 168; Rev.
          Rul. 66-97, 1966-1 C.B. 190)

                               SCOPE OF OPINION
                               ----------------

     Our opinion is limited to the federal income tax matters described above
and does not address any other federal income tax considerations or any state,
local, foreign or other federal tax considerations. If any of the information
upon which we have relied is incorrect, or if changes in the relevant facts
occur after the date hereof, our opinion could be affected thereby. Moreover,
our opinion is based on the case law, Code, Treasury Regulations thereunder and
Internal Revenue Service rulings as they now exist. These authorities are all
subject to change, and such change may be made with retroactive effect. We can
give no assurance that, after such change, our opinion would not be different.
We undertake no responsibility to update or supplement our opinion subsequent to
consummation of the Conversion. Prior to that time, we undertake to update or
supplement our opinion in the event of a material change in the federal income
tax consequences set forth above and to file such revised opinion as an exhibit
to the Registration Statement and the Association's Application for Conversion
on Form AC ("Form AC"). This opinion is not binding on the Internal Revenue
Service and there can be no assurance, and none is hereby given, that the
Internal Revenue Service will not take a position contrary to one or more of
the positions reflected in the foregoing opinion, or that our opinion will be
upheld by the courts if challenged by the Internal Revenue Service.

                                   CONSENTS
                                   --------

     We hereby consent to the filing of this opinion with the OTS as an exhibit 
to the Application H-(e)1-S filed by the Company with the OTS in connection with
the Conversion and the reference to our firm in the Application H-(e)1-S under 
Item 110.55 therein.

<PAGE>
 
Board of Directors
Northfield Federal Savings
_________, 1998
Page 10


     We also hereby consent to the filing of this opinion with the SEC and the 
OTS as exhibits to the Registration Statement and Form AC, respectively, and the
references to our firm in the Prospectus, which is a part of the Registration 
Statement and Form AC, under the headings "The Conversion -- Effect of 
Conversion to Stock Form on Depositors and Borrowers of Northfield Federal 
Savings -- Tax Effects" and "Legal and Tax Matters."


                                            Very truly yours,

                                            HOUSLEY KANTARIAN & BRONSTEIN, P.C.


                                            By:___________________________ 
                                               Gary R. Bronstein

<PAGE>
 
                                                                     EXHIBIT 8.2

                           ANDERSON ASSOCIATES, LLP

                          Certified Public Accountants
                                7621 Fitch Lane
                           Baltimore, Maryland 21236
                                 410-882-8050

Board of Directors
Northfield Federal Savings
8005 Harford Road
Baltimore, MD 21234

Gentlemen:

     You have requested an opinion from this firm regarding the tax consequences
of the conversion of Northfield Federal Savings (the "Association") from a 
federally chartered mutual savings association to a federally chartered 
capital stock savings bank with the name "Northfield Federal Savings Bank" (the 
"Converted Bank") and the concurrent acquisition of 100% of the outstanding 
capital stock of the Converted Bank by Northfield Bancorp, Inc., (the
"Company"), a Maryland corporation formed at the direction of the Board of
Directors of the Association to become the parent holding company of the
Converted Bank (the "Conversion").

     You have previously received a favorable opinion of counsel ("Federal Tax 
Opinion") stating that the conversion of the Bank from mutual to stock form 
under the Plan of Conversion would not result in adverse federal income tax 
consequences to the Association or to its eligible account holders (except to 
the extent of gain, if any, recognized upon the receipt of subscription rights 
and interest in the liquidation amount established as part of the conversion) 
under the Internal Revenue Code of 1986, as amended ("Code"). The Federal Tax 
Opinion rendered is predicated upon Revenue Ruling 80-105, 1980-1 C.B. 78, which
holds that a similar transaction qualified as a tax-free reorganization under 
section 368(a)(1)(F) of the Code. The Federal Tax Opinion provides that, based
upon the facts and circumstances attendant to the stock conversion of the
Association and described within the opinion, no adverse federal income tax
consequences would result to the Association or its eligible account holders
(except to the extent of gain, if any, recognized upon the receipt of
subscription rights and interest in the liquidation amount established as part
of the conversion) by virtue of the implementation of the Plan of Conversion.

     The laws of the State of Maryland will, for income tax purposes, treat the 
stock conversion of the Association in a manner which is, essentially, identical
to the treatment accorded to it by the Internal
<PAGE>
 
Board of Directors
Northfield Federal Savings
Page 2

Revenue Code for income tax purposes. Based upon the facts and circumstances 
attendant to the conversion as described in the Federal Tax Opinion, the 
foregoing revenue ruling and provision of the Code and the Federal Tax Opinion 
rendered, it is our opinion that under the laws of the State of Maryland no 
adverse income tax consequences will be incurred by either the Association or 
its eligible accounts holders (except to the extent of gain, if any, recognized 
upon the receipt of subscription rights and interests in the liquidation amount 
established as part of the conversion) as a result of the implementation of the 
Plan of Conversion.

     The opinion herein expressed specifically does not include, without 
limitation by the specification thereof, an opinion with respect to any 
franchise tax or capital stock taxes which might result from the implementation 
of the Plan of Conversion. Finally, we hereby consent to the filing of this 
opinion as an exhibit to the Form AC of the Association filed with the Office of
Thrift Supervision and the Registration Statement on Form SB-2 of the Holding
Company filed with the Securities and Exchange Commission.


                                             Very truly yours,


                                         Anderson Associates, LLP

                                   By ___________________________________
                                       William R. Anderson, CPA

<PAGE>
 
                                                                     EXHIBIT 8.3

                [LETTERHEAD OF FERGUSON & COMPANY APPEARS HERE]


                                 MARCH 6, 1998


BOARD OF DIRECTORS
NORTHFIELD FEDERAL SAVINGS
1844 EAST JOPPA ROAD
BALTIMORE, MARYLAND 21234

                    PLAN OF CONVERSION, SUBSCRIPTION RIGHTS
                    ---------------------------------------

DEAR DIRECTORS:

     Terms used in this letter not otherwise defined herein have the same 
meanings for such terms in the Plan of Conversion adopted by the Board of 
Directors of Northfield Federal Savings ("Northfield" or the "Bank"), under 
which the Bank will convert from a mutual savings association to a stock savings
association and issue all of the Bank's stock to Northfield Bancorp, Inc. (the 
"Holding Company"). Simultaneously, the Holding Company will issue shares of 
common stock.

     We understand that in accordance with the Plan of Conversion, Subscription 
Rights to purchase shares of Common Stock in the Holding Company are to be 
issued to (1) Eligible Account Holders, (2) The Bank's tax qualified employee 
plans, (3) Supplemental Eligible Account Holders, and (4) Other Members. Based 
solely upon our observation that the Subscription Rights will be available to 
such parties without cost, will be legally non-transferable and of short 
duration, and will afford such parties the right only to purchase shares of 
Common Stock at the same price to be paid by members of the general public in 
the Community Offering, but without undertaking any independent investigation of
state or federal laws or the position of the Internal Revenue Service with 
respect to such issue, in our opinion:

     (1)  the Subscription Rights will have no ascertainable market value; and

     (2)  the price at which the Subscription Rights are exercisable will not be
          more or less than the pro forma market value of the shares upon
          issuance.

     Changes in the local and national economy, the legislative and regulatory 
environment, the stock market, interest rates and other external forces (e.g., 
natural disasters or significant global events) occur from time to time and may 
materially affect the value of thrift stocks as a whole or the Holding 
Company's value. Accordingly, no assurance can be given that persons who 
subscribe to shares of Common Stock in the Conversion will thereafter be able to
sell such shares at the same price paid in the Subscription Offering.

                                        Sincerely,


                                        /s/ Robin L. Fussell


                                        Robin L. Fussell
                                        Principal


<PAGE>

                                                                    EXHIBIT 10.1
 
                           NORTHFIELD BANCORP, INC.
                            19__ STOCK OPTION PLAN
                                        
     1.   Purpose of the Plan.

     The purpose of this Plan is to advance the interests of the Company through
providing select key Employees and Directors of the Bank, the Company, and their
Affiliates with the opportunity to acquire Shares.  By encouraging such stock
ownership, the Company seeks to attract, retain and motivate the best available
personnel for positions of substantial responsibility and to provide additional
incentives to Directors and key Employees of the Company or any Affiliate to
promote the success of the business.

     2.   Definitions.

     As used herein, the following definitions shall apply.

     (a)  "Affiliate" shall mean any "parent corporation" or "subsidiary
corporation" of the Company, as such terms are defined in Section 424(e) and
(f), respectively, of the Code.

     (b)  "Agreement" shall mean a written agreement entered into in accordance
with Paragraph 5(c).

     (c)  "Awards" shall mean, collectively, Options and SARs, unless the
context clearly indicates a different meaning.

     (d)  "Bank" shall mean Northfield Federal Savings.

     (e)  "Board" shall mean the Board of Directors of the Company.

     (f)  "Code" shall mean the Internal Revenue Code of 1986, as amended.

     (g)  "Committee" shall mean not only the Stock Option Committee consisting
of at least two Non-Employee Directors appointed by the Board in accordance with
Paragraph 5(a) hereof, but also the Board.

     (h)  "Common Stock" shall mean the common stock of the Company.

     (i)  "Company" shall mean Northfield Bancorp, Inc.

     (j)  "Continuous Service" shall mean the absence of any interruption or
termination of service as an Employee or Director of the Company or an
Affiliate.  Continuous Service shall not be considered interrupted in the case
of sick leave, military leave or any other leave of absence approved by the
Company, in the case of transfers between payroll locations of the Company or
between the Company, an Affiliate or a successor, or in the case of a Director's
performance of services in an emeritus or advisory capacity.

     (k)  "Director" shall mean any member of the Board, and any member of the
board of directors of any Affiliate that the Board has by resolution designated
as being eligible for participation in this Plan.

     (l)  "Disability" shall mean a physical or mental condition, which in the
sole and absolute discretion of the Committee, is reasonably expected to be of
indefinite duration and to substantially prevent a Participant from fulfilling
his or her duties or responsibilities to the Company or an Affiliate.

     (m)  "Effective Date" shall mean the date specified in Paragraph 14 hereof.

     (n)  "Employee" shall mean any person employed by the Company, the Bank, or
an Affiliate.
<PAGE>
 
     (o)  "Exercise Price" shall mean the price per Optioned Share at which an
Option or SAR may be exercised.

     (p)  "ISO" shall mean an option to purchase Common Stock which meets the
requirements set forth in the Plan, and which is intended to be and is
identified as an "incentive stock option" within the meaning of Section 422 of
the Code.

     (q)  "Market Value" shall mean the fair market value of the Common Stock,
as determined under Paragraph 8(b) hereof.

     (r)  "Non-Employee Director" shall have the meaning provided in Rule 16b-3.

     (s)  "Non-ISO" means an option to purchase Common Stock which meets the
requirements set forth in the Plan but which is not intended to be and is not
identified as an ISO.

     (t)  "Option" means an ISO and/or a Non-ISO.

     (u)  "Optioned Shares" shall mean Shares subject to an Award granted
pursuant to this Plan.

     (v)  "OTS Award Limitations" shall mean the following percentage
limitations, determined with respect to the total Shares reserved for Awards
under this Plan: 25% for total Awards to any particular Employee, 5% for total
Awards to any particular non-Employee Director, and 30% for total Awards to the
non-Employee Directors as a group.

     (w)  "Participant" shall mean any person who receives an Award pursuant to
the Plan.

     (x)  "Plan" shall mean the Northfield Bancorp, Inc. 19__ Stock Option Plan.

     (y)  "Rule 16b-3" shall mean Rule 16b-3 of the General Rules and
Regulations under the Securities Exchange Act of 1934, as amended.

     (z)  "Share" shall mean one share of Common Stock.

     (aa) "SAR" (or "Stock Appreciation Right") means a right to receive the
appreciation in value, or a portion of the appreciation in value, of a specified
number of shares of Common Stock.

     (bb) "Year of Service" shall mean a full twelve-month period, measured from
the date of an Award and each annual anniversary of that date, during which a
Participant has not terminated Continuous Service for any reason.

     3.   Term of the Plan and Awards.

     (a)  Term of the Plan.  The Plan shall continue in effect for a term of ten
years from the Effective Date, unless sooner terminated pursuant to Paragraph 16
hereof.  No Award shall be granted under the Plan after ten years from the
Effective Date.

     (b)  Term of Awards.  The term of each Award granted under the Plan shall
be established by the Committee, but shall not exceed 10 years; provided,
however, that in the case of an Employee who owns Shares representing more than
10% of the outstanding Common Stock at the time an ISO is granted, the term of
such ISO shall not exceed five years.


                                      -2-
<PAGE>
 
     4.   Shares Subject to the Plan.

     (a)  General Rule.  Except as otherwise required under Paragraph 11, the
aggregate number of Shares deliverable pursuant to Awards shall not exceed
________ Shares, which equals 10% of the Shares issued by the Company in
connection with the Bank's conversion from mutual to stock form ("Conversion").
Such Shares may either be authorized but unissued Shares, Shares held in
treasury, or Shares held in a grantor trust created by the Company.  If any
Awards should expire, become unexercisable, or be forfeited for any reason
without having been exercised, the Optioned Shares shall, unless the Plan shall
have been terminated, be available for the grant of additional Awards under the
Plan.

     (b)  Special Rule for SARs.  The number of Shares with respect to which an
SAR is granted, but not the number of Shares which the Company delivers or could
deliver to an Employee or individual upon exercise of an SAR, shall be charged
against the aggregate number of Shares remaining available under the Plan;
provided, however, that in the case of an SAR granted in conjunction with an
Option, under circumstances in which the exercise of the SAR results in
termination of the Option and vice versa, only the number of Shares subject to
the Option shall be charged against the aggregate number of Shares remaining
available under the Plan.  The Shares involved in an Option as to which option
rights have terminated by reason of the exercise of a related SAR, as provided
in Paragraph 10 hereof, shall not be available for the grant of further Options
under the Plan.

     5.   Administration of the Plan.

     (a)  Appointment of the Committee.  The Plan shall be administered by the
Committee.  Members of the Committee shall serve at the pleasure of the Board.
In the absence at any time of a duly appointed Committee, the Plan shall be
administered by the Board.

     (b)  Powers of the Committee.  Except as limited by the express provisions
of the Plan or by resolutions adopted by the Board, the Committee shall have
sole and complete authority and discretion (i) to select Participants and grant
Awards, (ii) to determine the form and content of Awards to be issued in the
form of Agreements under the Plan, (iii) to interpret the Plan, (iv) to
prescribe, amend and rescind rules and regulations relating to the Plan, and (v)
to make other determinations necessary or advisable for the administration of
the Plan.  The Committee shall have and may exercise such other power and
authority as may be delegated to it by the Board from time to time.  A majority
of the entire Committee shall constitute a quorum and the action of a majority
of the members present at any meeting at which a quorum is present, or acts
approved in writing by a majority of the Committee without a meeting, shall be
deemed the action of the Committee.

     (c)  Agreement.  Each Award shall be evidenced by a written agreement
containing such provisions as may be approved by the Committee.  Each such
Agreement shall constitute a binding contract between the Company and the
Participant, and every Participant, upon acceptance of such Agreement, shall be
bound by the terms and restrictions of the Plan and of such Agreement.   The
terms of each such Agreement shall be in accordance with the Plan, but each
Agreement may include such additional provisions and restrictions determined by
the Committee, in its discretion, provided that such additional provisions and
restrictions are not inconsistent with the terms of the Plan.  In particular,
the Committee shall set forth in each Agreement (i) the Exercise Price of an
Option or SAR, (ii) the number of Shares subject to the Award, and its
expiration date, (iii) the manner, time, and rate (cumulative or otherwise) of
exercise or vesting of such Award, and (iv) the restrictions, if any, to be
placed upon such Award, or upon Shares which may be issued upon exercise of such
Award.  The Chairman of the Committee and such other Directors and officers as
shall be designated by the Committee are hereby authorized to execute Agreements
on behalf of the Company and to cause them to be delivered to the recipients of
Awards.

     (d)  Effect of the Committee's Decisions. All decisions, determinations and
interpretations of the Committee shall be final and conclusive on all persons
affected thereby.



                                      -3-
<PAGE>
 
     (e)  Indemnification.  In addition to such other rights of indemnification
as they may have, the members of the Committee shall be indemnified by the
Company in connection with any claim, action, suit or proceeding relating to any
action taken or failure to act under or in connection with the Plan or any
Award, granted hereunder to the full extent provided for under the Company's
governing instruments with respect to the indemnification of Directors.

     6.   Grant of Options to Employees.

     (a)  General Rule.  Only Employees shall be eligible to receive Awards.  In
selecting those Employees to whom Awards will be granted and the number of
shares covered by such Awards, the Committee shall consider the position, duties
and responsibilities of the eligible Employees, the value of their services to
the Company and its Affiliates, and any other factors the Committee may deem
relevant.  Notwithstanding the foregoing, the Committee shall automatically make
the Awards specified in Paragraphs 6(b) and 9 hereof, and (ii) no Employee or
non-Employee Director shall receive Options in excess of the OTS Award
Limitations.  [Not applicable if Plan is implemented more than one year after
the Date of the Conversion.]

     (b)  Automatic Grants to Employees.  On the Effective Date, each of the
following Employees shall receive an Option (in the form of an ISO, to the
extent permissible under the Code) to purchase the number of Shares listed below
(but not to exceed the OTS Award Limitations), at an Exercise Price per Share
equal to the Market Value of a Share on the Effective Date; provided that such
grant shall not be made to an Employee whose Continuous Service terminates on or
before the Effective Date:

                              Percentage of Shares
          Participant    Reserved under Paragraph 4(a)
          -----------    -----------------------------

 

With respect to each of the above-named Participants, the Option granted to the
Participant hereunder (i) shall vest in accordance with the general rule set
forth in Paragraph 9(a) of the Plan, (ii) shall have a term of ten years from
the Effective Date, and (iii) shall be subject to the general rule set forth in
Paragraph 9(c) with respect to the effect of a Participant's termination of
Continuous Service on the Participant's right to exercise his Options.

     (c)  Special Rules for ISOs.  The aggregate Market Value, as of the date
the Option is granted, of the Shares with respect to which ISOs are exercisable
for the first time by an Employee during any calendar year (under all incentive
stock option plans, as defined in Section 422 of the Code, of the Company or any
present or future Affiliate of the Company) shall not exceed $100,000.
Notwithstanding the foregoing, the Committee may grant Options in excess of the
foregoing limitations, in which case Options granted in excess of such
limitation shall be Non-ISOs.

     7.   Grants of Options to Non-employee Directors

     (a)  Automatic Grants.  Notwithstanding any other provisions of this Plan,
each Director who is not an Employee but is a Director on the Effective Date
shall receive, on said date, Non-ISOs to purchase a number of Shares (not to
exceed OTS Award Limitations) equal to the lesser of five percent (5%) of the
number of Shares reserved under Paragraph 4(a) hereof, and the quotient obtained
by dividing --

     (i)  30 percent (30%) of the number of Shares reserved under Paragraph 4(a)
     hereof, by

     (ii) the number of Directors entitled to receive an Option on the Effective
     Date, pursuant to this Paragraph 7(a).



                                      -4-
<PAGE>
 
[Formula and limits may change if Plan is adopted more than one year after the
Conversion.]

Such Non-ISOs shall have an Exercise Price per Share equal to the Market Value
of a Share on the date of grant.

     (b)  Terms of Exercise.  Options received under the provisions of this
Paragraph (i) shall become exercisable in accordance with paragraph 9(a) of the
Plan, and (ii) may be exercised from time to time by written notice of intent to
exercise the Option with respect to all or a specified number of the Optioned
Shares, and payment to the Company (contemporaneously with the delivery of such
notice), in cash, in Common Stock, or a combination of cash and Common Stock, of
the amount of the Exercise Price for the number of the Optioned Shares with
respect to which the Option is then being exercised.  Each such notice and
payment shall be delivered, or mailed by prepaid registered or certified mail,
addressed to the Treasurer of the Company at the Company's executive offices.  A
Director who exercises Options pursuant to this Paragraph may satisfy all
applicable Federal, state and local income and employment tax withholding
obligations, in whole or in part, by irrevocably electing to have the Company
withhold shares of Common Stock, or to deliver to the Company shares of Common
Stock that he already owns, having a value equal to the amount required to be
withheld; provided that to the extent not inconsistent herewith, such election
otherwise complies with those requirements of Paragraphs 8 and 19 hereof.

     Options granted under this Paragraph shall have a term of ten years;
provided that Options granted under this Paragraph shall expire one year after
the date on which a Director terminates Continuous Service on the Board for a
reason other than death, but in no event later than the date on which such
Options would otherwise expire.  In the event of such Director's death during
the term of his directorship, Options granted under this Paragraph shall become
immediately exercisable, and may be exercised within two years from the date of
his death by the personal representatives of his estate or person or persons to
whom his rights under such Option shall have passed by will or by laws of
descent and distribution, but in no event later than the date on which such
Options would otherwise expire.  In the event of such Director's Disability
during his or her directorship, the Director's Option shall become immediately
exercisable, and such Option may be exercised within one year of the termination
of directorship due to Disability, but not later than the date that the Option
would otherwise expire.  Unless otherwise inapplicable or inconsistent with the
provisions of this Paragraph, the Options to be granted to Directors hereunder
shall be subject to all other provisions of this Plan.

     (c)  Effect of the Committee's Decisions.  The Committee's determination
whether a Participant's Continuous Service has ceased, and the effective date
thereof, shall be final and conclusive on all persons affected thereby.

     8.   Exercise Price for Options.

     (a)  Limits on Committee Discretion.  The Exercise Price as to any
particular Option shall not be less than 100% of the Market Value of the
Optioned Shares on the date of grant.  In the case of an Employee who owns
Shares representing more than 10% of the Company's outstanding Shares of Common
Stock at the time an ISO is granted, the Exercise Price shall not be less than
110% of the Market Value of the Optioned Shares at the time the ISO is granted.

     (b)  Standards for Determining Exercise Price.  If the Common Stock is
listed on a national securities exchange (including the NASDAQ National Market
System) on the date in question, then the Market Value per Share shall be the
average of the highest and lowest selling price on such exchange on such date,
or if there were no sales on such date, then the Exercise Price shall be the
mean between the bid and asked price on such date.  If the Common Stock is
traded otherwise than on a national securities exchange on the date in question,
then the Market Value per Share shall be the mean between the bid and asked
price on such date, or, if there is no bid and asked price on such date, then on
the next prior business day on which there was a bid and asked price.  If no
such bid and asked price is available, then the Market Value per Share shall be
its fair market value as determined by the Committee, in its sole and absolute
discretion.



                                      -5-
<PAGE>
 
     9.   Exercise of Options.

     (a)  Generally.  Each Option shall become exercisable with respect to
twenty percent (20%) of the Optioned Shares upon the Participant's completion of
each of five Years of Service, provided that an Option shall become fully (100%)
exercisable immediately upon termination of the Participant's Continuous Service
due to the Participant's Disability or death. [May be different if the Plan is
implemented more than one year after the Date of the Conversion.] An Option may
not be exercised for a fractional Share. [If the Plan is implemented more than
one year after the Date of the Conversion, vesting would accelerate to 100% upon
a Participant's retirement or termination of service in connection with a change
in control.]

     (b)  Procedure for Exercise.  A Participant may exercise Options, subject
to provisions relative to its termination and limitations on its exercise, only
by (1) written notice of intent to exercise the Option with respect to a
specified number of Shares, and (2) payment to the Company (contemporaneously
with delivery of such notice) in cash, in Common Stock, or a combination of cash
and Common Stock, of the amount of the Exercise Price for the number of Shares
with respect to which the Option is then being exercised. Each such notice (and
payment where required) shall be delivered, or mailed by prepaid registered or
certified mail, addressed to the Treasurer of the Company at its executive
offices. Common Stock utilized in full or partial payment of the Exercise Price
for Options shall be valued at its Market Value at the date of exercise, and may
consist of Shares subject to the Option being exercised.

     (c)  Period of Exercisability.  Except to the extent otherwise provided in
the terms of an Agreement, an Option may be exercised by a Participant only
while he is an Employee and has maintained Continuous Service from the date of
the grant of the Option, or within one year after termination of such Continuous
Service (but not later than the date on which the Option would otherwise
expire), except if the Employee's Continuous Service terminates by reason of --

          (1) "Just Cause" which for purposes hereof shall have the meaning set
     forth in any unexpired employment or severance agreement between the
     Participant and the Bank and/or the Company (and, in the absence of any
     such agreement, shall mean termination because of the Employee's personal
     dishonesty, incompetence, willful misconduct, breach of fiduciary duty
     involving personal profit, intentional failure to perform stated duties,
     willful violation of any law, rule or regulation (other than traffic
     violations or similar offenses) or final cease-and-desist order), then the
     Participant's rights to exercise such Option shall expire on the date of
     such termination; or

          (2) death, then to the extent that the Participant would have been
     entitled to exercise the Option immediately prior to his death, such Option
     of the deceased Participant may be exercised within two years from the date
     of his death (but not later than the date on which the Option would
     otherwise expire) by the personal representatives of his estate or person
     or persons to whom his rights under such Option shall have passed by will
     or by laws of descent and distribution.
 
     (d)  Effect of the Committee's Decisions.  The Committee's determination
whether a Participant's Continuous Service has ceased, and the effective date
thereof, shall be final and conclusive on all persons affected thereby.

     (e)  Mandatory Six-Month Holding Period.  Notwithstanding any other
provision of this Plan to the contrary, common stock of the Company that is
purchased upon exercise of an Option or SAR may not be sold within the six-month
period following the grant of that Option or SAR.


                                      -6-
<PAGE>
 
     10.  SARs (Stock Appreciation Rights)

     (a)  Granting of SARs.  In its sole discretion, the Committee may from time
to time grant SARs to Employees either in conjunction with, or independently of,
any Options granted under the Plan.  An SAR granted in conjunction with an
Option may be an alternative right wherein the exercise of the Option terminates
the SAR to the extent of the number of shares purchased upon exercise of the
Option and, correspondingly, the exercise of the SAR terminates the Option to
the extent of the number of Shares with respect to which the SAR is exercised.
Alternatively, an SAR granted in conjunction with an Option may be an additional
right wherein both the SAR and the Option may be exercised.  An SAR may not be
granted in conjunction with an ISO under circumstances in which the exercise of
the SAR affects the right to exercise the ISO or vice versa, unless the SAR, by
its terms, meets all of the following requirements:

          (1)  The SAR will expire no later than the ISO;

          (2)  The SAR may be for no more than the difference between the
               Exercise Price of the ISO and the Market Value of the Shares
               subject to the ISO at the time the SAR is exercised;

          (3)  The SAR is transferable only when the ISO is transferable, and
               under the same conditions;

          (4)  The SAR may be exercised only when the ISO may be exercised; and

          (5)  The SAR may be exercised only when the Market Value of the Shares
               subject to the ISO exceeds the Exercise Price of the ISO.

     (b)  Terms of SAR Awards.  The provisions of Paragraphs 8 and 9 are
incorporated by reference herein, and shall determine the terms of SARs (to the
extent not inconsistent herewith).

     (c)  Exercise of SARs.  An SAR granted hereunder shall be exercisable at
such times and under such conditions as shall be permissible under the terms
of the Plan and of the Agreement granted to a Participant, provided that an SAR
may not be exercised for a fractional Share.  Upon exercise of an SAR, the
Participant shall be entitled to receive, without payment to the Company except
for applicable withholding taxes, an amount equal to the excess of (or, in the
discretion of the Committee if provided in the Agreement, a portion of) the
excess of the then aggregate Market Value of the number of Optioned Shares with
respect to which the Participant exercises the SAR, over the aggregate Exercise
Price of such number of Optioned Shares.  This amount shall be payable by the
Company, in the discretion of the Committee, in cash or in Shares valued at the
then Market Value thereof, or any combination thereof.

     11.  Effect of Changes in Common Stock Subject to the Plan.

     (a)  Recapitalizations; Stock Splits, Etc.  The number and kind of shares
reserved for issuance under the Plan, and the number and kind of shares subject
to outstanding Awards, and the Exercise Price thereof, shall be proportionately
adjusted for any increase, decrease, change or exchange of Shares for a
different number or kind of shares or other securities of the Company which
results from a merger, consolidation, recapitalization, reorganization,
reclassification, stock dividend, split-up, combination of shares, or similar
event in which the number or kind of shares is changed without the receipt or
payment of consideration by the Company.

     (b)  Transactions in which the Company is Not the Surviving Entity.  In the
event of (i) the liquidation or dissolution of the Company, (ii) a merger or
consolidation in which the Company is not the surviving entity, or (iii) the
sale or disposition of all or substantially all of the Company's assets (any of
the foregoing to be referred to herein as a "Transaction"), all outstanding
Awards, together with the Exercise Prices thereof, shall be equitably adjusted
for any change or exchange of Shares for a different number or kind of shares or
other securities which results from the Transaction.



                                      -7-
<PAGE>
 
     (c)  Special Rule for ISOs.  Any adjustment made pursuant to subparagraphs
(a) or (b) hereof shall be made in such a manner as not to constitute a
modification, within the meaning of Section 424(h) of the Code, of outstanding
ISOs.

     (d)  Conditions and Restrictions on New, Additional, or Different Shares or
Securities.  If, by reason of any adjustment made pursuant to this Paragraph, a
Participant becomes entitled to new, additional, or different shares of stock or
securities, such new, additional, or different shares of stock or securities
shall thereupon be subject to all of the conditions and restrictions which were
applicable to the Shares pursuant to the Award before the adjustment was made.

     (e)  Other Issuances.  Except as expressly provided in this Paragraph, the
issuance by the Company or an Affiliate of shares of stock of any class, or of
securities convertible into Shares or stock of another class, for cash or
property or for labor or services either upon direct sale or upon the exercise
of rights or warrants to subscribe therefor, shall not affect, and no adjustment
shall be made with respect to, the number, class, or Exercise Price of Shares
then subject to Awards or reserved for issuance under the Plan.

     (f)  Certain Special Dividends.  The Exercise Price of shares subject to
outstanding Awards shall be proportionately adjusted upon the payment of a
special large and nonrecurring dividend that has the effect of a return of
capital to the stockholders.

     12.  Non-Transferability of Awards.

     Awards may not be sold, pledged, assigned, hypothecated, transferred or
disposed of in any manner other than by will or by the laws of descent and
distribution.  Notwithstanding the foregoing, or any other provision of this
Plan, a Participant who holds Awards may transfer such Awards (but not Incentive
Stock Options) to his or her spouse, lineal ascendants, lineal descendants, or
to a duly established trust for the benefit of one or more of these individuals.
Awards so transferred may thereafter be transferred only to the Participant who
originally received the grant or to an individual or trust to whom the
Participant could have initially transferred the Awards pursuant to this
Paragraph 12.  Awards which are transferred pursuant to this Paragraph 12 shall
be exercisable by the transferee according to the same terms and conditions as
applied to the Participant.

     13.  Time of Granting Awards.

     The date of grant of an Award shall, for all purposes, be the later of the
date on which the Committee makes the determination of granting such Award, and
the Effective Date.  Notice of the determination shall be given to each
Participant to whom an Award is so granted within a reasonable time after the
date of such grant.

     14.  Effective Date.

     The Plan shall become effective immediately upon its approval by a
favorable vote of stockholders owning at least a majority of the total votes
eligible to be cast at a duly called meeting of the Company's stockholders held
in accordance with applicable laws, provided that the Plan shall not be
submitted  for such approval within the six-month period after the Bank
completes its mutual-to-stock conversion.  [Stockholder approval may be
unnecessary, or involve a different vote requirement, if the Plan is implemented
more than one year after the Date of the Conversion.]  No Awards may be made
prior to approval of the Plan by the stockholders of the Company.

     15.  Modification of Awards.

     At any time, and from time to time, the Board may authorize the Committee
to direct execution of an instrument providing for the modification of any
outstanding Award, provided no such modification shall confer on 



                                      -8-
<PAGE>
 
the holder of said Award any right or benefit which could not be conferred on
him by the grant of a new Award at such time, or impair the Award without the
consent of the holder of the Award.

     16.  Amendment and Termination of the Plan.

     The Board may from time to time amend the terms of the Plan and, with
respect to any Shares at the time not subject to Awards, suspend or terminate
the Plan.  No amendment, suspension or termination of the Plan shall, without
the consent of any affected holders of an Award, alter or impair any rights or
obligations under any Award theretofore granted.

     17.  Conditions Upon Issuance of Shares.

     (a)  Compliance with Securities Laws.  Shares of Common Stock shall not be
issued with respect to any Award unless the issuance and delivery of such Shares
shall comply with all relevant provisions of law, including, without limitation,
the Securities Act of 1933, as amended, the rules and regulations promulgated
thereunder, any applicable state securities law, and the requirements of any
stock exchange upon which the Shares may then be listed.

     (b)  Special Circumstances.  The inability of the Company to obtain
approval from any regulatory body or authority deemed by the Company's counsel
to be necessary to the lawful issuance and sale of any Shares hereunder shall
relieve the Company of any liability in respect of the non-issuance or sale of
such Shares. As a condition to the exercise of an Option or SAR, the Company may
require the person exercising the Option or SAR to make such representations and
warranties as may be necessary to assure the availability of an exemption from
the registration requirements of federal or state securities law.

     (c)  Committee Discretion.  The Committee shall have the discretionary
authority to impose in Agreements such restrictions on Shares as it may deem
appropriate or desirable, including but not limited to the authority to impose a
right of first refusal or to establish repurchase rights or both of these
restrictions.

     18.  Reservation of Shares.

     The Company, during the term of the Plan, will reserve and keep available a
number of Shares sufficient to satisfy the requirements of the Plan.

     19.  Withholding Tax.

     The Company's obligation to deliver Shares upon exercise of Options and/or
SARs shall be subject to the Participant's satisfaction of all applicable
federal, state and local income and employment tax withholding obligations.  The
Committee, in its discretion, may permit the Participant to satisfy the
obligation, in whole or in part, by irrevocably electing to have the Company
withhold Shares, or to deliver to the Company Shares that he already owns,
having a value equal to the amount required to be withheld.  The value of the
Shares to be withheld, or delivered to the Company, shall be based on the Market
Value of the Shares on the date the amount of tax to be withheld is to be
determined.  As an alternative, the Company may retain, or sell without notice,
a number of such Shares sufficient to cover the amount required to be withheld.

     20.  No Employment or Other Rights.

     In no event shall an Employee's or Director's eligibility to participate or
participation in the Plan create or be deemed to create any legal or equitable
right of the Employee, Director, or any other party to continue service with the
Company, the Bank, or any Affiliate of such corporations.  Except to the extent
provided in Paragraphs 6(b) and 7(a), no Employee or Director shall have a right
to be granted an Award or, having received an Award, the right to 



                                      -9-
<PAGE>
 
again be granted an Award. However, an Employee or Director who has been granted
an Award may, if otherwise eligible, be granted an additional Award or Awards.

     21.  Governing Law.

     The Plan shall be governed by and construed in accordance with the laws of
the State of Maryland, except to the extent that federal law shall be deemed to
apply.



                                     -10-

<PAGE>
 
                                                                    EXHIBIT 10.2

                           NORTHFIELD BANCORP, INC.
                          MANAGEMENT RECOGNITION PLAN

                                   ARTICLE I
                           ESTABLISHMENT OF THE PLAN



     1.01  The Company hereby establishes this Plan upon the terms and
conditions hereinafter stated.

     1.02  Through acceptance of their appointment to the Committee, each member
of the Committee hereby accepts his or her appointment hereunder upon the terms
and conditions hereinafter stated.

                                  ARTICLE II
                              PURPOSE OF THE PLAN

     2.01  The purpose of the Plan is to reward and retain personnel of
experience and ability in key positions of responsibility by providing Employees
and Directors of the Company, the Bank, and their Affiliates with a proprietary
interest in the Company, and as compensation for their past contributions to the
Bank, and as an incentive to make such contributions in the future.

                                  ARTICLE III
                                  DEFINITIONS

     The following words and phrases when used in this Plan with an initial
capital letter, shall have the meanings set forth below unless the context
clearly indicates otherwise.  Wherever appropriate, the masculine pronoun shall
include the feminine pronoun and the singular shall include the plural.

     3.01  "Affiliate" shall mean any "parent corporation" or "subsidiary
corporation" of the Company, as such terms are defined in Section 424(e) and
(f), respectively, of the Internal Revenue Code of 1986, as amended.

     3.02  "Bank" means Northfield Federal Savings.

     3.03  "Beneficiary" means the person or persons designated by a Participant
to receive any benefits payable under the Plan in the event of such
Participant's death.  Such person or persons shall be designated in writing on
forms provided for this purpose by the Committee and may be changed from time to
time by similar written notice to the Committee.  In the absence of a written
designation, the Beneficiary shall be the Participant's surviving spouse, if any
or if none, his estate.

     3.04  "Board" means the Board of Directors of the Company.

     3.05  "Committee" means the Management Recognition Plan Committee appointed
by the Board pursuant to Article IV hereof.

     3.06  "Common Stock" means shares of the common stock of the Company.

     3.07  "Company" means Northfield Bancorp, Inc.

     3.08  "Continuous Service" shall mean the absence of any interruption or
termination of service as an Employee or Director of the Company or an
Affiliate.  Continuous Service shall not be considered interrupted in the case
of sick leave, military leave or any other leave of absence approved by the
Company in the case of transfers between payroll locations of the Company or
between the Company, an Affiliate or a successor, or in the case of a Director's
performance of services in an emeritus or advisory capacity.

                                       1
<PAGE>
 
     3.09  "Date of Conversion" means the date of the conversion of the Bank
from mutual to stock form.

     3.10  "Director" means a member of the Board.

     3.11  "Disability" shall mean a physical or mental condition, which in the
sole and absolute discretion of the Committee, is reasonably expected to be of
indefinite duration and to substantially prevent a Participant from fulfilling
his or her duties or responsibilities to the Company or an Affiliate.

     3.12  "Effective Date" means the date on which the Plan first becomes
effective, as determined under Section 8.07 hereof.

     3.13  "Employee" means any person who is employed by the Company or an
Affiliate.

     3.14  "Non-Employee Director" shall have the meaning provided in Rule 16b-3
of the General Rules and Regulations under the Securities Exchange Act of 1934,
as amended.

     3.15  "OTS Award Limitations" shall mean the following percentage
limitations, determined with respect to the total shares reserved for awards
under this Plan: 25% for total Plan Share Awards to any particular Employee, 5%
for total Plan Share Awards to any particular non-Employee Director, and 30% for
total Plan Share Awards to the non-Employee Directors as a group.

     3.16  "Participant" means an Employee or Director who holds a Plan Share
Award.

     3.17  "Plan" means this Northfield Bancorp, Inc. Management Recognition
Plan.

     3.18  "Plan Shares" means shares of Common Stock held in the Trust which
are awarded or issuable to a Participant pursuant to the Plan.

     3.19  "Plan Share Award" means a right granted under this Plan to receive
Plan Shares.

     3.20  "Plan Share Reserve" means the shares of Common Stock held by the
Trustee pursuant to Sections 5.02 and 5.03.

     3.21  "Trust" and "Trust Agreement" mean that agreement entered into
pursuant to the terms hereof between the Company and the Trustee, and "Trust"
means the trust created thereunder.

     3.22  "Trustee" means that person(s) or entity appointed by the Board
pursuant to the Trust Agreement to hold legal title to the Plan assets for the
purposes set forth herein.

     3.23  "Year of Service" shall mean a full twelve-month period, measured
from the date of a Plan Share Award and each annual anniversary of that date,
during which a Participant's Continuous Service has not terminated for any
reason.

                                  ARTICLE IV
                          ADMINISTRATION OF THE PLAN

     4.01  Role and Powers of the Committee.  The Plan shall be administered and
interpreted by the Committee, which shall consist of not less than two members
of the Board who are Non-Employee Directors.  In the absence at any time of a
duly appointed Committee, the Plan shall be administered by those members of the
Board who are Non-Employee Directors, and by the Board if there are less than
two Non-Employee Directors.

                                       2
<PAGE>
 
     The Committee shall have all of the powers allocated to it in this and
other Sections of the Plan.  Except as limited by the express provisions of the
Plan or by resolutions adopted by the Board, the Committee shall have sole and
complete authority and discretion (i) to make Plan Share Awards to such
Employees as the Committee may select, (ii) to determine the form and content of
Plan Share Awards to be issued under the Plan, (iii) to interpret the Plan, (iv)
to prescribe, amend and rescind rules and regulations relating to the Plan, and
(v) to make other determinations necessary or advisable for the administration
of the Plan.  The Committee shall have and may exercise such other power and
authority as may be delegated to it by the Board from time to time.  Subject to
Section 4.02, the interpretation and construction by the Committee of any
provisions of the Plan or of any Plan Share Award granted hereunder shall be
final and binding.  The Committee shall act by vote or written consent of a
majority of its members, and shall report its actions and decisions with respect
to the Plan to the Board at appropriate times, but in no event less than one
time per calendar year.  The Committee may recommend to the Board one or more
persons or entity to act as Trustee(s) in accordance with the provisions of this
Plan and the Trust.

     4.02  Role of the Board.  The members of the Committee shall be appointed
or approved by, and will serve at the pleasure of, the Board.  The Board may in
its discretion from time to time remove members from, or add members to, the
Committee.  The Board shall have all of the powers allocated to it in this and
other Sections of the Plan, may take any action under or with respect to the
Plan which the Committee is authorized to take, and may reverse or override any
action taken or decision made by the Committee under or with respect to the
Plan, provided, however, that the Board may not revoke any Plan Share Award
already made or impair a participant's vested rights under a Plan Share Award.
Members of the Board who are eligible for or who have been granted Plan Share
Awards (other than pursuant to Section 6.04) may not vote on any matters
affecting the administration of the Plan or the grant of Plan Shares or Plan
Share Awards (although such members may be counted in determining the existence
of a quorum at any meeting of the Board during which actions with regard thereto
are taken).  Further, with respect to all actions taken by the Board in regard
to the Plan, such action shall be taken by a majority of the Board where such a
majority of the directors acting in the matter are Non-Employee Directors.

     4.03  Limitation on Liability.  No member of the Board or the Committee or
the Trustee(s) shall be liable for any determination made in good faith with
respect to the Plan or any Plan Shares or Plan Share Awards granted under it.
If a member of the Board or the Committee or any Trustee is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of anything done or not done by him in such capacity under or with
respect to the Plan, the Company shall indemnify such member against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him or her in connection with such action,
suit or proceeding if he or she acted in good faith and in a manner he or she
reasonably believed to be in the best interests of the Company and its
Affiliates and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful.


                                   ARTICLE V
                       CONTRIBUTIONS; PLAN SHARE RESERVE

     5.01  Amount and Timing of Contributions.  The Board shall determine the
amounts (or the method of computing the amounts) to be contributed by the
Company to the Trust, provided that the Bank may also make contributions to the
Trust.  Such amounts shall be paid to the Trustee at the time of contribution.
No contributions to the Trust by Employees shall be permitted.

     5.02  Investment of Trust Assets; Maximum Plan Share Awards.  The Trustee
shall invest Trust assets only in accordance with the Trust Agreement; provided
that the Trust shall not purchase, and Plan Share Awards shall not be made with
respect to, more than four percent (4%) of the number of Shares issued on the
Date of Conversion.

                                       3
<PAGE>
 
     5.03  Effect of Allocations, Returns and Forfeitures Upon Plan Share
Reserves.  Upon the allocation of Plan Share Awards under Section 6.02, the Plan
Share Reserve shall be reduced by the number of Shares subject to the Awards so
allocated.  Any Shares subject or attributable to an Award which may not be
earned because of a forfeiture by the Participant pursuant to Section 7.01 shall
be added to the Plan Share Reserve.

                                  ARTICLE VI
                           ELIGIBILITY; ALLOCATIONS

     6.01  Eligibility.  Except as otherwise provided in Section 6.04 hereof,
the Committee shall make Plan Share Awards only to Employees.  In selecting
those Employees to whom Plan Share Awards will be granted and the number of
shares covered by such Awards, the Committee shall consider the position, duties
and responsibilities of the eligible Employees, the value of their services to
the Company and its Affiliates, and any other factors the Committee may deem
relevant.  Notwithstanding the foregoing, (i) the Committee shall automatically
make the Plan Share Awards specified in Sections 6.04 and 6.05 hereof; and (ii)
no Employee or non-Employee Director shall receive Plan Share Awards in excess
of the OTS Award Limitations.  [Not applicable if Plan is implemented more than
one year after Date of Conversion.]

     6.02  Allocations.  The Committee will determine which Employees will be
granted discretionary Plan Share Awards, and the number of Shares covered by
each Plan Share Award, provided that in no event shall any Awards be made which
will violate the governing instruments of the Bank or its Affiliates or any
applicable federal or state law or regulation.  In the event Plan Shares are
forfeited for any reason or additional shares of Common Stock are purchased by
the Trustee, the Committee may, from time to time, determine which of the
Employees referenced in Section 6.01 above will be granted additional Plan Share
Awards to be awarded from the forfeited or acquired Plan Shares.

     6.03  Form of Allocation.  As promptly as practicable after a determination
is made pursuant to Section 6.02 that a Plan Share Award is to be made, the
Committee shall notify the Participant in writing of the grant of the Award, the
number of Plan Shares covered by the Award, and the terms upon which the Plan
Shares subject to the Award may be earned.  The date on which the Committee so
notifies the Participant shall be considered the date of grant of the Plan Share
Awards.  The Committee shall maintain records as to all grants of Plan Share
Awards under the Plan.

     6.04  Automatic Grants to Non-Employee Directors.  Notwithstanding any
other provisions of this Plan, each Director who is not an Employee but is a
Director on the Effective Date shall receive, on said date, a Plan Share Award
for a number of Shares equal to the lesser of five (5%) of the number of Plan
Shares which the Trust is authorized to purchase pursuant to Section 5.02 of the
Plan and the quotient obtained by dividing --

     (i)  thirty percent (30%) of the number of Plan Shares which the Trust is
          authorized to purchase pursuant to Section 5.02 of the Plan, by

     (ii) the number of Directors entitled to receive Plan Share Awards on the
          Effective Date, pursuant to this Section 6.04.

[Formula and limits may change if Plan is adopted more than one year after Date
of Conversion.]

Plan Share Awards received under the provisions of this Section shall become
vested and nonforfeitable according to the general rules set forth in
subsections (a), and (b) of Section 7.01, and the Committee shall have no
discretion to alter or accelerate said vesting requirements.  Unless otherwise
inapplicable or inconsistent with the provisions of this Section, the Plan Share
Awards to be granted hereunder shall be subject to all other provisions of this
Plan.

                                       4
<PAGE>
 
     6.05  Automatic Grants to Employees.  On the Effective Date, each of the
following individuals shall receive a Plan Share Award as to the number of Plan
Shares listed below (not to exceed the OTS Award Limitations), provided that
such award shall not be made to an individual who is not an Employee on the
Effective Date:


          Employee           Shares Subject to Plan Share Award
          --------           ----------------------------------


[Formula and limits may change if Plan is adopted more than one year after Date
of Conversion.]

Plan Share Awards received under the provisions of this Section shall become
vested and nonforfeitable according to the general rules set forth in
subsections (a) and (b) of Section 7.01, and the Committee shall have no
discretion to alter said vesting requirements.  Unless otherwise inapplicable or
inconsistent with the provisions of this Section, the Plan Share Awards to be
granted hereunder shall be subject to all other provisions of this Plan.

     6.06  Allocations Not Required.  Notwithstanding anything to the contrary
in Sections 6.01 and 6.02, but subject to Sections 6.04 and 6.05, no Employee or
Director shall have any right or entitlement to receive a Plan Share Award
hereunder, such Awards being at the total discretion of the Committee, nor shall
any Employees or Directors as a group have such a right.  The Committee may,
with the approval of the Board (or, if so directed by the Board) return all
Common Stock in the Plan Share Reserve to the Company at any time, and cease
issuing Plan Share Awards.


                                  ARTICLE VII
            EARNINGS AND DISTRIBUTION OF PLAN SHARES; VOTING RIGHTS

     7.01  Earning Plan Shares; Forfeitures.

          (a) General Rules.  Twenty percent (20%) of the Plan Shares subject to
a Plan Share Award shall be earned and become non-forfeitable by a Participant
upon his or her completion of each of five Years of Service. [May be different
if the Plan is implemented more than one year after the Date of Conversion.]

          (b) Exception for Terminations Due to Death or Disability.
Notwithstanding the general rule contained in Section 7.01(a) above, all Plan
Shares subject to a Plan Share Award held by a Participant whose service with
the Company or an Affiliate terminates due to the Participant's death or
Disability, shall be deemed earned as of the Participant's last day of service
with the Company or an Affiliate and shall be distributed as soon as practicable
thereafter. [If the Plan is implemented more than one year after the Date of
Conversion, vesting would accelerate to 100% upon a Participant's retirement or
termination of service in connection with a change in control.]

     7.02  Accrual of Dividends.  Whenever Plan Shares are paid to a Participant
or Beneficiary under Section 7.03, such Participant or Beneficiary shall also be
entitled to receive, with respect to each Plan Share paid, an amount equal to
any cash dividends (including special large and nonrecurring dividends,
including one that has the effect of a return of capital to the Company's
stockholders) and a number of shares of Common Stock equal to any stock
dividends, declared and paid with respect to a share of Common Stock between the
date the relevant Plan Share Award was initially granted to such Participant and
the date the Plan Shares are being distributed.  There shall also be distributed
an appropriate amount of net earnings, if any, of the Trust with respect to any
cash dividends so paid out.

                                       5
<PAGE>
 
     7.03  Distribution of Plan Shares.

          (a) Timing of Distributions:  General Rule.  Except as provided in
subsections (c), and (d) below, the Trustee shall distribute Plan Shares and
accumulated cash from dividends and interest to the Participant or his
Beneficiary, as the case may be, as soon as practicable after they have been
earned.  No fractional shares shall be distributed.

          (b) Form of Distribution.  The Trustee shall distribute all Plan
Shares, together with any shares representing stock dividends, in the form of
Common Stock.  One share of Common Stock shall be given for each Plan Share
earned.  Payments representing cash dividends (and earnings thereon) shall be
made in cash.

          (c) Withholding.  The Trustee shall withhold from any cash payment
made under this Plan sufficient amounts to cover any applicable withholding and
employment taxes, and if the amount of such cash payment is not sufficient, the
Trustee shall require the Participant or Beneficiary to pay to the Trustee the
amount required to be withheld as a condition of delivering the Plan Shares.
The Trustee shall pay over to the Company or Affiliate which employs or employed
such Participant any such amount withheld from or paid by the Participant or
Beneficiary.

          (d) Timing: Exception for 10% Shareholders.  Notwithstanding
Subsections (a) and (b) above, no Plan Shares may be distributed prior to the
date which is five (5) years from the Date of Conversion to the extent the
Participant or Beneficiary, as the case may be, would after receipt of such
Shares own in excess of ten percent (10%) of the issued and outstanding shares
of Common Stock unless such action is approved in advance by a majority vote of
non-employee directors of the Board.  To the extent this limitation would delay
the date on which a Participant receives Plan Shares, the Participant may elect
to receive from the Trust, in lieu of such Plan Shares, the cash equivalent
thereof.  Any Plan Shares remaining undistributed solely by reason of the
operation of this Subsection (d) shall be distributed to the Participant or his
Beneficiary on the date which is five years from the Date of Conversion.

          (e) Regulatory Exceptions.  No Plan Shares shall be distributed unless
and until all of the requirements of all applicable law and regulation shall
have been fully complied with, including the receipt of approval of the Plan by
the stockholders of the Company by such vote, if any, as may be required by
applicable law and regulations.

     7.04  Voting of Plan Shares.  All shares of Common Stock held by the Trust
(whether or not subject to a Plan Share Award) shall be voted by the Trustee in
the same proportion as the trustee of the Company's Employee Stock Ownership
Plan votes Common Stock held in the trust associated therewith, and in the
absence of any such voting, shall be voted in the manner directed by the Board.

     7.05  Deferral Elections by Participants.

           (a) Elections to Defer.  At any time prior to December 31/st/ of any
year prior to the date on which a Participant becomes vested in any shares
subject to his or her Plan Share Award, a Participant who is a member of a
select group of management or highly compensated employees (within the meaning
of the Employees' Retirement Income Security Act of 1973) may irrevocably elect,
on the form attached hereto as Exhibit "A" (the "Election Form"), to defer the
receipt of all or a percentage of the Plan Shares that would otherwise be
transferred to the Participant upon the vesting of such award (the "Deferred
Shares").

           (b) Recordkeeping; Holding of Deferred Shares.  The MRP Committee
shall establish and maintain an individual account in the name of each
Participant who files an Election Form for the purpose of tracking deferred
earnings attributable to cash dividends paid on Deferred Shares (the "Cash
Account"). On the last day of each fiscal year of the Company, the Committee
shall credit to the Participant's Cash Account earnings on the balance of the
Cash Account at a rate equal to the dividend-adjusted total return on Common
Stock, as 

                                       6
<PAGE>
 
determined from time to time by the MRP Committee in its sole discretion. The
Trustees shall hold each Participant's Deferred Shares and Deferred Earnings in
the Trust until distribution is required pursuant to the election set forth in
the Participant's Election Form.

           (c) Distributions of Deferred Shares.  The Trustee shall distribute a
Participant's Deferred Shares and Deferred Earnings in accordance with the
Participant's Election Form.  All distributions made by the Company and/or the
Trustees pursuant to elections made hereunder shall be subject to applicable
federal, state, and local tax withholding and to such other deductions as shall
at the time of such payment be required under any income tax or other law,
whether of the United States or any other jurisdiction, and, in the case of
payments to a beneficiary, the delivery to the Committee and/or Trustees of all
necessary waivers, qualifications and other documentation.  Within 90 days after
receiving notice of a Participant's death, the Trustee shall distribute any
balance of the Participant's Deferred Shares and Deferred Earnings to the
Participant's designated beneficiary, if living, or if such designated
beneficiary is deceased or the Participant failed to designate a beneficiary, to
the Participant's estate.  If, on the other hand, a Participant's Continuous
Service terminates for a reason other than the Participant's death, Disability,
early retirement, or normal retirement, the Participant's Deferred Shares and
Deferred Earnings shall be distributed to the Participant in a lump sum
occurring as soon as reasonably practicable.  The distribution provisions of a
Participant's Election Form shall become irrevocable on the date that occurs (i)
one year before the Participant's termination of Continuous Service for a reason
other than death, and (ii) on the Participant's death if that terminates the
Participant's Continuous Service.

           (d) Hardship Withdrawals.  Notwithstanding any other provision of the
Plan or a Participant's Election Form, in the event the Participant suffers an
unforeseeable emergency hardship within the contemplation of this paragraph, the
Participant may apply to the Committee for an immediate distribution of all or a
portion of his Deferred Shares and Deferred Earnings. The hardship must result
from a sudden and unexpected illness or accident of the Participant or a
dependent of the Participant, casualty loss of property, or other similar
conditions beyond the control of the Participant. Examples of purposes which are
not considered hardships include post-secondary school expenses or the desire to
purchase a residence. In no event will a distribution be made to the extent the
hardship could be relieved through reimbursement or compensation by insurance or
otherwise, or by liquidation of the Participant's nonessential assets to the
extent such liquidation would not itself cause a severe financial hardship. The
amount of any distribution hereunder shall be limited to the amount necessary to
relieve the Participant's financial hardship. The determination of whether a
Participant has a qualifying hardship and the amount which qualifies for
distribution, if any, shall be made by the Committee in its sole discretion. The
Committee may require evidence of the purpose and amount of the need, and may
establish such application or other procedures as it deems appropriate.

           (e) Rights to Deferred Shares and Earnings.  A Participant may not
assign his or her claim to Deferred Shares and Deferred Earnings during his or
her lifetime, except in accordance with Section 8.03 of this Plan. A
Participant's right to Deferred Shares and Deferred Earnings shall at all times
constitute an unsecured promise of the Company to pay benefits as they come due.
The right of the Participant or his or her beneficiary to receive benefits
hereunder shall be solely an unsecured claim against the general assets of the
Company.  Neither the Participant nor his or her beneficiary shall have any
claim against or rights in any specific assets or other fund of the Company, and
any assets in the Trust shall be deemed general assets of the Company.

                                 ARTICLE VIII
                                 MISCELLANEOUS

     8.01  Adjustments for Capital Changes.

           (a) Recapitalizations; Stock Splits, Etc.  The number and kind of
shares which may be purchased under the Plan, and the number and kind of shares
subject to outstanding Plan Share Awards, shall be proportionately adjusted for
any increase, decrease, change or exchange of shares of Common Stock for a
different number or kind of shares or other securities of the Company which
results from a merger, consolidation, 

                                       7
<PAGE>
 
recapitalization, reorganization, reclassification, stock dividend, split-up,
combination of shares, or similar event in which the number or kind of shares is
changed without the receipt or payment of consideration by the Company.

           (b) Transactions in which the Company is Not the Surviving Entity. In
the event of (i) the liquidation or dissolution of the Company, (ii) a merger or
consolidation in which the Company is not the surviving entity, or (iii) the
sale or disposition of all or substantially all of the Company's assets (any of
the foregoing to be referred to herein as a "Transaction"), all outstanding Plan
Share Awards shall be adjusted for any change or exchange of shares of Common
Stock for a different number or kind of shares or other securities which results
from the Transaction.

           (c) Conditions and Restrictions on New, Additional, or Different
Shares or Securities.  If, by reason of any adjustment made pursuant to this
Section, a Participant becomes entitled to new, additional, or different shares
of stock or securities, such new, additional, or different shares of stock or
securities shall thereupon be subject to all of the conditions and restrictions
which were applicable to the shares pursuant to the Plan Share Award before the
adjustment was made.  In addition, the Committee shall have the discretionary
authority to impose on the Shares subject to Plan Share Awards to Employees such
restrictions as the Committee may deem appropriate or desirable, including but
not limited to a right of first refusal, or repurchase option, or both of these
restrictions.

           (d) Other Issuances.  Except as expressly provided in this Section,
the issuance by the Company or an Affiliate of shares of stock of any class, or
of securities convertible into shares of Common Stock or stock of another class,
for cash or property or for labor or services either upon direct sale or upon
the exercise of rights or warrants to subscribe therefor, shall not affect, and
no adjustment shall be made with respect to, the number or class of shares of
Common Stock then subject to Plan Share Awards or reserved for issuance under
the Plan.

     8.02  Amendment and Termination of Plan.  The Board may, by resolution, at
any time amend or terminate the Plan; provided that no amendment or termination
of the Plan shall, without the written consent of a Participant, impair any
rights or obligations under a Plan Share Award theretofore granted to the
Participant.

     The power to amend or terminate the Plan in accordance with this Section
8.02 shall include the power to direct the Trustee to return to the Company all
or any part of the assets of the Trust, including shares of Common Stock held in
the Plan Share Reserve.  However, the termination of the Trust shall not affect
a Participant's right to earn Plan Share Awards and to receive a distribution of
Common Stock relating thereto, including earnings thereon, in accordance with
the terms of this Plan and the grant by the Committee or the Board.

     8.03  Nontransferability.  Plan Share Awards may not be sold, pledged,
assigned, hypothecated, transferred or disposed of in any manner other than by
will or by the laws of descent and distribution.  Notwithstanding the foregoing,
or any other provision of this Plan, a Participant who holds Plan Share Awards
may transfer such Plan Share Awards to his or her spouse, lineal ascendants,
lineal descendants, or to a duly established trust for the benefit of one or
more of these individuals.  Plan Share Awards so transferred may thereafter be
transferred only to the Participant who originally received the grant or to an
individual or trust to whom the Participant could have initially transferred the
Plan Share Awards pursuant to this Section 8.03.  Plan Share Awards which are
transferred pursuant to this Section 8.03 shall be exercisable by the transferee
according to the same terms and conditions as applied to the Participant.

     8.04  No Employment or Other Rights.  Neither the Plan nor any grant of a
Plan Share Award or Plan Shares hereunder nor any action taken by the Trustee,
the Committee or the Board in connection with the Plan shall create any right,
either express or implied, on the part of any Employee or Director to continue
in the service of the Company, the Bank, or an Affiliate thereof.

                                       8
<PAGE>
 
     8.05  Voting and Dividend Rights.  No Participant shall have any voting or
dividend rights or other rights of a stockholder in respect of any Plan Shares
covered by a Plan Share Award prior to the time said Plan Shares are actually
distributed to him.

     8.06  Governing Law.  The Plan and Trust shall be governed and construed
under the laws of the State of Maryland to the extent not preempted by Federal
law.

     8.07  Effective Date.  The Plan shall become effective immediately upon its
approval by a favorable vote of stockholders of the Company who own at least a
majority of the total votes eligible to be cast at a duly called meeting of the
Company's stockholders held in accordance with applicable laws, provided that
the Plan shall not be submitted for such approval within the six-month period
after the Date of Conversion.  [Stockholder approval may be unnecessary, or
involve a different vote requirement, if the Plan is implemented more than one
year after the Date of Conversion.]  In no event shall Plan Share Awards be made
prior to the Effective Date.

     8.08  Term of Plan.  This Plan shall remain in effect until the earlier of
(i) termination by the Board, or (ii) the distribution of all assets of the
Trust.  Termination of the Plan shall not affect any Plan Share Awards
previously granted, and such Awards shall remain valid and in effect until they
have been earned and paid, or by their terms expire or are forfeited.

     8.09  Tax Status of Trust.  It is intended that (i) the Trust associated
with the Plan be treated as a grantor trust of the Company under the provisions
of Section 671 et seq. of the Code, as the same may be amended from time to
               -- ---                                                      
time, and (ii) that in accordance with Revenue Procedure 92-65 (as the same may
be amended from time to time), Participants have the status of general unsecured
creditors of the Company, the Plan constitutes a mere unfunded promise to make
benefit payments in the future, the Plan is unfunded for tax purposes and for
purposes of Title I of the Employee Retirement Income Security Act of 1974, as
amended, and the Trust has been and will continue to be maintained in conformity
with Revenue Procedure 92-64 (as the same may be amended from time to time).

                                       9

<PAGE>
 
                                                                    EXHIBIT 10.3



                          NORTHFIELD FEDERAL SAVINGS
                          DEFERRED COMPENSATION PLAN

                      -----------------------------------

                          Effective December 24, 1997

                      -----------------------------------


     The Board of Directors of Northfield Federal Savings ("Bank") has adopted
this Deferred Compensation Plan ("Plan") in order to provide deferred income to
its directors.

                                  ARTICLE I
                                 Definitions
                                 -----------

     The following words and phrases, when used in the Plan with an initial
capital letter, shall have the meanings set forth below unless the context
clearly indicates otherwise.

     1.1  "Account" shall mean a bookkeeping account maintained by the Bank in
the name of each Participant.

     1.2  "Affiliate" shall mean any "parent corporation" or "subsidiary
corporation" of the Bank, as the terms are defined in Section 424(e) and (f),
respectively, of the Internal Revenue Code of 1986, as amended.

     1.3  "Bank" shall mean Northfield Federal Savings, and any successor to its
interest.

     1.4  "Beneficiary"  shall mean the person or persons whom a Participant may
designate as the beneficiary of the Participant's Benefits under Article II,
and, in the event of no such designation, the Participant's estate.

     1.5  "Benefits" shall mean any and all benefits that are or may become
payable under Article  II of the Plan.

     1.6  "Board" shall mean the Board of Directors of the Bank.

     1.7  "Change in Control" shall mean any of the following events:

     (a) When the Bank is in the "mutual" form of organization, a "Change in
Control" shall be deemed to have occurred if: (i)  as a result of, or in
connection with, any exchange offer, merger or other business combination, sale
of assets or contested election, any combination of the foregoing transactions,
or any similar transaction, the persons who were Directors of the Bank before
such transaction cease to constitute a majority of the Board of Directors of the
Bank or any successor to the Bank, (ii)  the Bank transfers substantially all of
its assets to another corporation which is not an Affiliate of the Bank, (iii)
the Bank sells substantially all of the assets of an Affiliate which accounted
for 50% or more of the controlled group's assets immediately prior to 
<PAGE>
 
such sale, (iv) any "person" including a "group", exclusive of the Board of
Directors of the Bank or any committee thereof, is or becomes the "beneficial
owner", directly or indirectly, of proxies of the Bank representing twenty-five
percent (25%) or more of the combined voting power of the Bank's members, or (v)
the Bank is merged or consolidated with another corporation and, as a result of
the merger or consolidation, less than seventy percent (70%) of the outstanding
proxies relating to the surviving or resulting corporation are given, in the
aggregate, by the former members of the Bank.

     (b) If the Bank shall be in the "stock" form of organization, a "Change in
Control" shall  mean any one of the following events:  (i) the acquisition of
ownership, holding or power to vote more than 25% of the voting stock of the
Bank thereof, (ii) the acquisition of the ability to control the election of a
majority of the Bank's Directors, (iii) the acquisition of a controlling
influence over the management or policies of the Bank by any person or by
persons acting as a "group" (within the meaning of Section 13(d) of the
Securities Exchange Act of 1934), or (iv) during any period of two consecutive
years, individuals (the "Continuing Directors") who at the beginning of such
period constitute the Board of Directors of the Bank (the "Existing Board")
cease for any reason to constitute at least two-thirds thereof, provided that
any individual whose election or nomination for election as a member of the
Existing Board was approved by a vote of at least two-thirds of the Continuing
Directors then in office shall be considered a Continuing Director.  For
purposes of this paragraph only, the term "person" refers to an individual or a
corporation, partnership, trust, association, joint venture, pool, syndicate,
sole proprietorship, unincorporated organization or any other form of entity not
specifically listed herein.

     Notwithstanding the foregoing, a "Change in Control" shall not be deemed to
                                                                ---             
occur solely by reason of a transaction in which the Bank converts in whole or
in part to the stock form of organization, or creates an independent holding
company in connection therewith.  The decision of the Board as to whether a
Change in Control has occurred shall be conclusive and binding.

     1.8   "Committee" shall mean any committee that the Board may appoint to
administer and effectuate the Plan.  The Committee shall act only by a majority
of its members, and may act through meetings or written consents.
Notwithstanding the foregoing, the Board may at any time act in lieu of the
Committee with respect to any action that the Committee may take pursuant to the
Plan.

     1.9   "Common Stock" shall mean the common stock, if any, of the Bank, but
shall mean common stock of a holding company of the Bank if one is formed for
that purpose independently of a Change in Control.

     1.10  "Deferral Election Form" shall mean the form attached as Exhibit AA."

     1.11  "Director" shall mean a member of the Board.

     1.12  "Distribution Election Form" shall mean the form attached hereto as
Exhibit "B."

                                       2
<PAGE>
 
     1.13  "Effective Date" shall mean December 24, 1997.

     1.14  "Employee" shall mean any person who is employed by the Bank or an
Affiliate.

     1.15  "Executive Officer" shall mean a senior officer of the Bank.

     1.16  "Investment Election Form" shall mean the form attached as 
Exhibit "C."

     1.17  "Just Cause" shall mean misconduct, breach of fiduciary duty
involving personal profit, intentional failure to perform stated duties, willful
violations of any law, rule or regulation (other than traffic violations or
similar offenses), or final cease-and-desist orders.

     1.18  "Participant" shall mean (i) an individual who serves as a Director
of the Bank on the Effective Date, regardless of whether or not the Director is
an Employee, and (ii) any Director or Employee whom the Board specifically
selects for participation in the Plan after the Effective Date, provided that an
Employee shall be eligible for Plan participation only if the Employee is a
member of a select group of the Bank's management or highly compensated
employees for purposes of Title I of the Employee Retirement Income Security Act
of 1974, as amended from time to time.

     1.19  "Plan" shall mean this Northfield Federal Savings Deferred
Compensation Plan.

     1.20  "Plan Year" shall mean the one-year period that begins each January
1, except the initial Plan Year shall begin on December 24, 1997 and end on
December 31, 1997.

     1.21  "Trust" shall mean the trust created under the Trust Agreement.

     1.22  "Trust Agreement" shall mean the agreement entered into between the
Bank and the Trustee, pursuant to the terms hereof.

     1.23  "Trustee" shall mean the person(s) or entity appointed by the Board
pursuant to the Trust Agreement to hold legal title to the Plan Assets for the
purposes set forth herein.

     1.24  "Year of Service" shall mean each full year of a Participant's
service on the Board, measured from the date a Participant initially joins the
Board.

                                     ARTICLE II
                                 Credits to Accounts
                                 -------------------

     2.1  Initial Credits. On December 31, 1997, the Bank shall credit the
Account of each Participant with an amount equal to the product of $2,500 and
the Participant's Years of Service (disregarding Years of Service in excess of
ten years).

                                       3
<PAGE>
 
     2.2  Elective Deferrals.  Prior to each Plan Year, each non-Employee
Participant may elect to defer the receipt of all or part of their future fees
(including retainers), and each employee-Participant may elect to defer up to
25% of salary or 100% of  bonus compensation.  Such elections shall be (i) made
on the Deferral Election Form, and (ii) effective on the January 1st following
their acceptance by the Committee, provided that a Participant may elect to have
an election take effect as soon as practicable by the Bank with respect to
compensation that the Participant may receive in the future and as to which the
                                                            ---                
Participant currently has no legal right or claim.  Any such elections shall be
irrevocable with respect to compensation for services rendered before the date
of the susperseding election.

     2.3  Short-swing Profit Rule.  If a Participant elects to have his or her
Account appreciate or depreciate based on the Common Stock fund, the
effectiveness of any investment election that the Participant makes shall be
deferred until the next following date on which said election would not result
in an "opposite way" transaction for purposes of SEC Rule 16b-3.  For purposes
of this paragraph, an "opposite way" transaction means an election that affects
a "sale" of the Common Stock by a Participant within six months of an election
that affects a "purchase" (and vice versa), whether under this Plan or another
plan maintained by the Bank.  This six-month "opposite way" rule will not apply,
however, if the Participant elects to receive a distribution in connection with
either his or her death or termination of the Participant's service with the
- ------                  --                                                  
Bank.

     2.4  Investment Return.   From the date of any credits through distribution
under the terms of the Plan, each Participant's Account shall be credited with
the highest rate of return paid by the Bank on its one-year certificates of
deposit.   Notwithstanding the foregoing, in the event of a stock conversion by
the Bank, each Participant may elect to have his or her Account credited with
either the highest rate of return paid by the Bank on its one-year certificates
- ------                                                                         
of deposit, or the total return on the Bank's Common Stock.
            --                                             

     2.5  Vesting; Forfeiture for Just Cause.  Amounts credited to Participant's
Accounts shall be fully vested at all times, provided that in the event that a
Participant's service with the Bank terminates for Just Cause, the portion of
the Participant's Account that is attributable to Bank credits made pursuant to
Sections 2.1 hereof shall be automatically forfeited.


                                 ARTICLE III 
                  Distribution from Accounts; Election Forms
                  ------------------------------------------


     3.1  General Rule.  The Bank shall distribute the vested balance credited
to a Participant's Account in accordance with the Participant's Distribution
Election Form (subject to Section 2.5 hereof).  In the absence of a valid
election, the Bank shall distribute the Participant's Account in substantially
equal annual installments over a period of five (5) years, beginning on the
first day of the second month following the Participant's termination from the
Bank for any reason other than Just Cause.  If Common Stock is outstanding at
the time of a Participant's termination of service, the Participant may elect on
the Distribution Election Form to receive his 

                                       4
<PAGE>
 
or her distribution in cash or Common Stock (but only to the extent that shares
of Common Stock are then held in the Trust for the Participant's benefit.)

     3.2  Death Benefits. If a Participant dies before receiving all Benefits
payable pursuant to the preceding paragraph, then the remaining balance of the
Participant's Account shall be distributed in a lump sum payment of cash and
Common Stock (if applicable) to the Participant's designated Beneficiary not
later than the first day of the second month following the date of the
Participant's death; provided that a Participant may specify on the Distribution
Election Form a distribution period that effectuates the annual installment
payments selected by the Participant (with payments made as though the
Participant survived to collect all benefits and retired on the date of his or
her death if payments had not previously commenced).

     3.3  Elections.  To be effective, a Participant's Distribution Election
Form must be submitted either (i) more than one year before the date on which
                       ------                                                
the Participant's service as a Director for any reason, or (ii) within 30 days
                                                        --                    
of the Plan's Effective Date or the Participant's initial service with the Bank
as a Director, or (iii) more than 90 days before a Change in Control.
               --                                                     
Nevertheless, Beneficiary designations made pursuant to executed Distribution
Election Forms shall be revocable during the Participant's lifetime and the
Participant may, by submitting an effective superseding Distribution Election
Form at any time or from time to time, prospectively change the designated
Beneficiary and the manner of payment to a Beneficiary.


                                  ARTICLE IV
                              Source of Benefits
                              ------------------

     4.1  General Rule.  The rights of the Participants under this Plan and of
their Beneficiaries (if any) shall be solely those of unsecured creditors of the
Bank.  Benefits shall constitute an unfunded, unsecured promise by the Bank to
pay such payments in the future, as and to the extent such Benefits become
payable.  Benefits shall be paid from the general assets of the Bank, and no
person shall, by virtue of this Plan, have any interest in such assets, other
than as an unsecured creditor of the Bank.  For any fiscal year during which a
Trust is maintained,(i) the Fiduciary Trustee shall inform the Board annually
prior to the commencement of each fiscal year as to the manner in which such
Trust assets shall be invested, and (ii) the Board shall, as soon as practicable
after the end of each fiscal year of the Bank, provide the Fiduciary Trustee
with a schedule specifying the amounts payable to each Participant, and the date
for making such payments.

     4.2  Change in Control.  In the event of a Change in Control, the Bank
shall contribute to the Trust an amount sufficient to provide the Trust with
assets having an overall value equivalent to the value of the aggregate Account
balances under the Plan.

                                       5
<PAGE>
 
                                 ARTICLE V
                                 Assignment
                                 ----------

     Except as otherwise expressly provided by this Plan, it is agreed that
neither the Participant nor his or her Beneficiary, including the Participant's
executors and administrators, heirs, legatees, distributees, and any other
person or persons claiming any benefits under him or her under this Plan, shall
have any right to assign, transfer, pledge, hypothecate, sell, transfer,
alienate and encumber or otherwise convey the right to receive any Benefits
hereunder, which Benefits and the rights thereto are expressly declared to be
nontransferable.  The right to receive Benefits under this Plan shall likewise
not be subject to execution, attachment, garnishment sequestration or similar
legal, equitable or other process to the benefit of the Participant's creditors.
Any attempted assignment, transfer, pledge hypothecation or other disposition of
the Participant's rights to receive Benefits under this Plan or the levy of any
attachment, garnishment or similar process thereupon, shall be null and void and
without effect.  Notwithstanding the foregoing, or any other provision of this
Plan, a Participant may transfer all or any part of his or her Account, and the
rights associated therewith, to his or her spouse, lineal ascendants, lineal
descendants, or to a duly established trust for the benefit of one or more of
these individuals.  Plan Benefits so transferred may thereafter be transferred
only to the Participant who was originally entitled to receive said Benefits or
to an individual or trust to whom the Participant could have initially
transferred the Benefits pursuant to this Article V.  The Benefits, and the
rights thereto, which are transferred pursuant to this Article V shall be
exercisable by the transferee according to the same terms and conditions as
applied to the Participant.

                                  ARTICLE VI
                           No Retention of Services
                           ------------------------

     The Benefits payable under this Plan shall be independent of, and in
addition to, any other compensation payable by the Bank to a Participant,
whether in the form of fees, bonus, retirement income under employee benefit
plans sponsored or maintained by the Bank or otherwise.  This Plan shall not be
deemed to constitute a contract of employment between the Bank and any
Participant.

                                  ARTICLE VII
                              Rights of Trustees;
                              -------------------
                  Termination or Suspension under Federal Law
                  -------------------------------------------

     The rights of Participants and their Beneficiaries (if any) shall be solely
those of unsecured creditors of the Bank.  If a Participant is removed and/or
permanently prohibited from participating in the conduct of the Bank's affairs
by an order issued under Sections 8(e)(4) or 8(g)(1) of the Federal Deposit
Insurance Act ("FDIA") (12 U.S.C. 1818(e)(4) or (g)(1)), all obligations of the
Bank under this Plan shall terminate, as of the effective date of the order, but
vested rights of the parties shall not be affected.  If the Bank is in default
(as defined in Section 

                                       6
<PAGE>
 
3(x)(1) of FDIA), all obligations under this Plan shall terminate as of the date
of default; however, this Paragraph shall not affect the vested rights of the
parties.

     If a notice served under Section 8(e)(3) or (g)(1) of the FDIA (12 U.S.C.
1818(e)(3) or (g)(1)) suspends and/or temporarily prohibits the Participant from
participating in the conduct of the Bank's affairs, the Bank's obligations under
this Plan shall be suspended as of the date of such service, unless stayed by
appropriate proceedings.  If the charges in the notice are dismissed, the Bank
may in its discretion (i) pay the Participant all or part of the compensation
withheld while its contract obligations were suspended, and (ii) reinstate (in
whole or in part) any of its obligations which were suspended.

                                 ARTICLE VIII
                                Reorganization
                                --------------

     The Bank agrees that it will not merge or consolidate with any other
corporation or organization, or permit its business activities to be taken over
by any other organization, unless and until the succeeding or continuing
corporation or other organization shall expressly assume the rights and
obligations of the Bank herein set forth.  The Bank further agrees that it will
not cease its business activities or terminate its existence, other than as
heretofore set forth in this Article VIII, without having made adequate
provision for the fulfillment of its obligation hereunder.

                                  ARTICLE IX
                           Amendment and Termination
                           -------------------------

     The Board may amend or terminate the Plan at any time, provided that no
such amendment or termination shall, without the written consent of an affected
Participant, alter or impair any accrued rights of the Participant under the
Plan.

                                   ARTICLE X
                                   State Law
                                   ---------

     This Plan shall be construed and governed in all respects under and by the
laws of the State of Maryland, except to the extent preempted by federal law.
If any provision of this Plan shall be held by a court of competent jurisdiction
to be invalid or unenforceable, the remaining provisions hereof shall continue
to be fully effective.

                                  ARTICLE XI
                               Headings; Gender
                               ----------------

     Headings and subheadings in this Plan are inserted for convenience and
reference only and constitute no part of this Plan.  This Plan shall be
construed, where required, so that the masculine gender includes the feminine.

                                       7
<PAGE>
 
                                  ARTICLE XII
                          Interpretation of the Plan
                          --------------------------

     The Board shall have sole and absolute discretion to administer, construe,
and interpret the Plan, and the decisions of the Board shall be conclusive and
binding on all affected parties, unless such decisions are arbitrary and
capricious.


                                 ARTICLE XIII
                                  Legal Fees
                                  ----------

     In the event any dispute shall arise between a Participant and the Bank as
to the terms or interpretation of this Plan, whether instituted by formal legal
proceedings or otherwise, including any action taken by a Participant to enforce
the terms of this Plan or in defending against any action taken by the Bank, the
Bank shall reimburse the Participant for all costs and expenses, including
reasonable attorneys' fees, arising from such dispute, proceedings or actions;
provided that the Participant shall return such amounts to the Bank if he fails
to obtain a final judgment by a court of competent jurisdiction or obtain a
settlement of such dispute, proceedings, or actions substantially in his or her
favor.  Such reimbursements to a Participant shall be paid within ten days of
the Participant furnishing to the Bank written evidence, which may be in the
form, among other things, of a canceled check or receipt, of any costs or
expenses incurred by the Participant.  Any such request for reimbursement by a
Participant shall be made no more frequently than at 30-day intervals.


                                  ARTICLE XIV
                               Duration of Plan
                               ----------------

     Unless terminated earlier in accordance with Article IX, this Plan shall
remain in effect during the term of service of the Participants and until all
Benefits payable hereunder have been made.

                                       8
<PAGE>
 
                                                                 Exhibit "A"

                          NORTHFIELD FEDERAL SAVINGS
                          DEFERRED COMPENSATION PLAN
                         ----------------------------

                            Deferral Election Form

                         ----------------------------

     AGREEMENT, made this -- day of ------, 199-, by and between ------------
(the "Participant") and Northfield Federal Savings (the "Bank").

     WHEREAS, the Bank has established the Northfield Federal Savings Deferred
Compensation Plan, effective December 24, 1997, (the "Plan"), and the
Participant is eligible to participate in said Plan.

     NOW THEREFORE, it is mutually agreed as follows:

     1.  The Participant, by the execution hereof, agrees to participate in the
Plan upon the terms and conditions set forth therein, and, in accordance
therewith, elects to defer the receipt of:

    [_] -----% of the Participant's base salary, director's fees, and/or
        retainers.

    [_] -----% of any additional cash compensation that the Participant may
        receive.

     2.  Unless the Participant checks this space -------- thereby designating
the next January 1st as this election's effective date, this election will
supersede any prior election and will take effect as soon as practicable
hereafter, (but only with respect to future compensation as to which the
Participant has no current legal right or claim through the rending of
services).

     3.  This election will continue in force until either the effective date of
                                                    ------                      
a superseding election by the Participant, or until the Participant terminates
                                           --                                 
service with the Bank, or until the Plan is terminated by appropriate corporate
                       --                                                      
action, whichever shall first occur.

     IN WITNESS WHEREOF, the parties hereto have hereunto set their hands the
day and year first above-written.

Witnessed by:             PARTICIPANT

- ------------------    ---------------------------------------

Witnessed by:             NORTHFIELD FEDERAL SAVINGS

                                       9
<PAGE>
 
- -----------------------------  By --------------------------------------
                                   A member of the Board

                                       10
<PAGE>
 
                                                                    Exhibit "B"
                          NORTHFIELD FEDERAL SAVINGS
                          DEFERRED COMPENSATION PLAN

                          --------------------------

                          Distribution Election Form

                          --------------------------

         AGREEMENT, made this ____ day of ________, 19__, by and between the
undersigned participant (the "Participant") in the Northfield Federal Savings
Deferred Compensation Plan, effective December 24, 1997, (the "Plan"), and
Northfield Federal Savings (the "Bank") with respect to distribution of the
Participant's benefits under the Plan.

         NOW THEREFORE, it is mutually agreed as follows:

         1. Form of Payment Generally. The Participant, by the execution hereof,
            -------------------------
agrees to participate in the Plan upon the terms and conditions set forth
therein, and, in accordance therewith, elects to have his or her Account
distributed as follows:


            [_]  in a lump sum.


            [_]  in substantially equal annual payments over a period of ___
                 years.

         2. Timing of Payment. Payment of a Participant's first annual
            -----------------
installment from his or her Account shall occur no later than March 31st of the
year after the Participant terminates service with the Bank. Payment of any
subsequent annual installments shall be occur no later than March 31 of each
calendar year thereafter.

         3. Medium of Payment. Any benefits payable to the Participant shall be
            -----------------
paid --

            [_]  in cash only.

            [_]  in cash and any shares of common stock of the Bank (or its
                 holding company, if one is formed) that are held in the Plan's
                 grantor trust for the Participant's benefit.

         4. Form of Payment to Beneficiary. In the event of the Participant's
            ------------------------------
death, his or her Account shall be distributed --


            [_]  in one lump sum payment.

            [_]  in accordance with the payment schedule selected in paragraph 1
                 hereof (with payments made as though the Participant survived
                 to collect all benefits, and 
<PAGE>
 
Deferred Compensation Plan
Distribution Election Form
Page 2

                 as though the Participant terminated service on the date of his
                 or her death, if payments had not already begun).

         5. Designation of Beneficiary. In the event of the Participant's death
            --------------------------
before he or she has collected all of the benefits payable under the Plan, the
Participant hereby directs that any survivorship benefits payable under Article
III of the Plan be distributed to the beneficiary or beneficiaries designated
under subparagraphs a and b of this paragraph 5 in the manner elected pursuant
to paragraph 3 above:

         a. Primary Beneficiary. The Participant hereby designates the person(s)
            -------------------
named below to be his or her primary beneficiary and to receive the balance of
any unpaid benefits under the Plan.
<TABLE> 
<CAPTION> 
         ================================================================================================    
                    Name of                       Mailing Address                   Percentage of            
              Primary Beneficiary                                                   Death Benefit            
         ------------------------------------------------------------------------------------------------    
         <S>                                      <C>                               <C> 
                                                                                          %                  
         ------------------------------------------------------------------------------------------------    
                                                                                                             
                                                                                          %                  
         ================================================================================================    
</TABLE> 
         b. Contingent Beneficiary. In the event that the primary beneficiary or
            ----------------------
beneficiaries named above are not living at the time of the Participant's death,
the Participant hereby designates the following person(s) to be his or her
contingent beneficiary for purposes of the Plan:
<TABLE> 
<CAPTION> 
         ================================================================================================           
                    Name of                       Mailing Address                   Percentage of         
             Contingent Beneficiary                                                 Death Benefit         
         ------------------------------------------------------------------------------------------------ 
         <S>                                      <C>                               <C> 
                                                                                          %                         
         ------------------------------------------------------------------------------------------------ 
                                                                                                                    
                                                                                          %                         
         ================================================================================================ 
</TABLE> 
         6. Effect of Election. The elections made in paragraphs 1, 2 and 3
            ------------------
hereof shall become irrevocable on the later of (1) the Participant's death, (2)
the date one year before the Participant first becomes entitled to receive a
distribution under Article III of the Plan, and (3) the date 90 days before a
Change in Control. The Participant may, by submitting an effective superseding
Distribution Election Form at any time and from time to time, prospectively
change the beneficiary 
<PAGE>
 
Deferred Compensation Plan
Distribution Election Form
Page 3

designation and the manner of payment to a Beneficiary. Such elections shall,
however, become irrevocable upon the Participant's death.

         7. Mutual Commitments. The Bank agrees to make payment of all amounts
            ------------------
due the Participant in accordance with the terms of the Plan and the elections
made by the Participant herein. The Participant agrees to be bound by the terms
of the Plan, as in effect on the date hereof or properly amended hereafter.


         IN WITNESS WHEREOF, the parties hereto have hereunto set their hands
the day and year first above-written.


Witnessed by:                      PARTICIPANT


- ---------------------------        -------------------------------------------



Witnessed by:                      NORTHFIELD FEDERAL SAVINGS

- --------------------------
                                   By 
                                     -----------------------------------------
                                     A duly authorized Administrator of the Plan
<PAGE>
 
                                                                     Exhibit "C"

                          NORTHFIELD FEDERAL SAVINGS
                          DEFERRED COMPENSATION PLAN

                          --------------------------

                           Investment Election Form

                          --------------------------

         WHEREAS, Northfield Federal Savings (the "Bank") has established the
Northfield Federal Savings Deferred Compensation Plan, effective December 24,
1997, (the "Plan"), and the undersigned participant therein is eligible to make
an investment election pursuant to Article II of said Plan.

         NOW THEREFORE, the Participant hereby elects as follows:

         1. The Participant directs that any amounts credited to his or her
account under the Plan will appreciate or depreciate from the effective date
hereof, as though they were invested as follows:

            ___%  in one-year certificates of deposit of the Bank.

            ___%  in shares of the common stock of the Bank or its holding
                  company, with credit for the total return paid to stock
                  holders, but only to the extent shares are purchased by the
                  Bank's rabbi trust (and otherwise as though they were invested
                  in one-year certificates of deposit of the Bank).

         2. The investment election made in the prior paragraph shall be
effective on the first day of the next following calendar quarter, and shall
remain in effect until the December 31st that immediately follows the
Committee's receipt of a properly executed superseding investment election by
the Participant.

         IN WITNESS WHEREOF, the Participant has executed this form on the 
__ day of _________ 19__.

Witnessed by:                       PARTICIPANT

- ------------------------            ------------------------------------
<PAGE>
 
                                                                    Exhibit "D"



                          NORTHFIELD FEDERAL SAVINGS
                          DEFERRED COMPENSATION PLAN

                          --------------------------

                          Initial Credits to Accounts

                          ---------------------------


<TABLE> 
<CAPTION> 
                                   Per Director              Total

              Participants             1997    Each of the    1997     Each of the
                                              Next 7 Years            Next 7 Years
<S>                                 <C>       <C>           <C>       <C> 
         Four Directors w/10
         or more years on the       $ 25,000        0       $100,000        0
         Board

         Two Directors w/3
         years on the Board         $  7,500     $2,500     $ 15,000     $5,000
                  Total             $ 32,500     $2,500     $115,000     $5,000
</TABLE> 

<PAGE>
 
                                                                    EXHIBIT 23.2

                           ANDERSON ASSOCIATES, LLP

                         Certified Public Accountants
                                7621 Fitch Lane
                           Baltimore, Maryland 21236
                                 410-882-8050


     As the independent certified public accountant of Northfield Federal
Savings, we hereby consent to the use of our report and to all references to
our Firm included in or made part of the Registration Statement on Form SB-2 and
in the Application for Conversion.


March 25, 1998

/s/ Anderson Associates LLP
    Anderson Associates, LLP
    Baltimore, Maryland

<PAGE>
 
                                                                    EXHIBIT 23.3

                [LETTERHEAD OF FERGUSON & COMPANY APPEARS HERE]


                                MARCH 25, 1998

BOARD OF DIRECTORS
NORTHFIELD FEDERAL SAVINGS
1844 EAST JOPPA ROAD
BALTIMORE, MARYLAND 21234

DIRECTORS:

     We hereby consent to the use of our firm's name in the Form AC Application 
for Conversion of Northfield Federal Savings, Baltimore, Maryland, and any 
amendments thereto, and in the Form SB-2 Registration Statement of Northfield 
Bancorp, Inc. and any amendments thereto. We also hereby consent to the 
inclusion of, summary of, and references to our Appraisal Report and our opinion
concerning subscription rights in such filings including the Prospectus of 
Northfield Bancorp, Inc.

                                                        /s/ Robin L. Fussell
                                                     
                                                        Robin L. Fussell
                                                        Principal

<TABLE> <S> <C>

<PAGE>

<ARTICLE> 9
       
<S>                             <C>
<PERIOD-TYPE>                   12-MOS
<FISCAL-YEAR-END>                          DEC-31-1997
<PERIOD-START>                             JAN-01-1997
<PERIOD-END>                               DEC-31-1997
<CASH>                                         116,900
<INT-BEARING-DEPOSITS>                       3,513,650
<FED-FUNDS-SOLD>                                     0
<TRADING-ASSETS>                                     0
<INVESTMENTS-HELD-FOR-SALE>                          0
<INVESTMENTS-CARRYING>                       1,955,008
<INVESTMENTS-MARKET>                         2,010,934
<LOANS>                                     29,961,032
<ALLOWANCE>                                    215,500
<TOTAL-ASSETS>                              36,084,416
<DEPOSITS>                                  32,621,766
<SHORT-TERM>                                         0
<LIABILITIES-OTHER>                            568,893
<LONG-TERM>                                          0
                                0
                                          0
<COMMON>                                             0
<OTHER-SE>                                   2,893,757
<TOTAL-LIABILITIES-AND-EQUITY>              36,084,416
<INTEREST-LOAN>                              2,209,375
<INTEREST-INVEST>                              181,123
<INTEREST-OTHER>                               235,958
<INTEREST-TOTAL>                             2,626,456
<INTEREST-DEPOSIT>                           1,473,588
<INTEREST-EXPENSE>                           1,493,561
<INTEREST-INCOME-NET>                        1,132,895
<LOAN-LOSSES>                                  123,270
<SECURITIES-GAINS>                            (32,321)
<EXPENSE-OTHER>                                771,503
<INCOME-PRETAX>                                235,704
<INCOME-PRE-EXTRAORDINARY>                           0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                   144,531
<EPS-PRIMARY>                                        0
<EPS-DILUTED>                                        0
<YIELD-ACTUAL>                                    3.37
<LOANS-NON>                                    135,000
<LOANS-PAST>                                   279,254
<LOANS-TROUBLED>                                     0
<LOANS-PROBLEM>                                      0
<ALLOWANCE-OPEN>                               100,000
<CHARGE-OFFS>                                    7,770
<RECOVERIES>                                         0
<ALLOWANCE-CLOSE>                              215,500
<ALLOWANCE-DOMESTIC>                           215,500
<ALLOWANCE-FOREIGN>                                  0
<ALLOWANCE-UNALLOCATED>                              0
        

</TABLE>

<PAGE>
 
                          NORTHFIELD FEDERAL SAVINGS
                               8005 HARFORD ROAD
                           BALTIMORE, MARYLAND 21234
                                (410) 665-7900

                     NOTICE OF SPECIAL MEETING OF MEMBERS

     Notice is hereby given that a Special Meeting of Members (the "Special
Meeting") of Northfield Federal Savings (the "Association") will be held at
__________________________, _______________________, Baltimore, Maryland, on
___________, 1998 at __:__ .m. Eastern Time.  The business to be taken up at
the Special Meeting shall be:

     (1)   To consider and vote upon a Plan of Conversion providing for the
           conversion of the Association from a federally chartered mutual
           savings association to a federally chartered stock savings bank, to
           be known as "Northfield Federal Savings Bank" (the"Bank"), as a
           wholly owned subsidiary of Northfield Bancorp, Inc., a newly
           organized Maryland corporation formed by the Association for the
           purpose of becoming the holding company for the Bank and the related
           transactions provided for in such Plan of Conversion, including the
           amendment of the Association's existing Federal Mutual Charter and
           Bylaws to read in the form of a Federal Stock Charter and Bylaws for
           the Bank, pursuant to the laws of the United States and the Rules and
           Regulations administered by the Office of Thrift Supervision.

     (2)   To consider and vote upon any other matters that may lawfully come
           before the Special Meeting.

     Note: As of the date of mailing of this Notice of Special Meeting of
           Members, the Board of Directors is not aware of any other matters
           that may come before the Special Meeting.

     The members entitled to vote at the Special Meeting shall be those members
of the Association at the close of business on __________ ___, 1998, who
continue as members until the Special Meeting and, should the Special Meeting
be, from time to time, adjourned to a later time, until the final adjournment
thereof.

                                 BY ORDER OF THE BOARD OF DIRECTORS


                                 J. Thomas Hoffman
                                 Secretary
______________, 1998
Baltimore, Maryland



                                 _____________

          YOUR BOARD OF DIRECTORS URGES YOU TO CONSIDER CAREFULLY THIS PROXY
MATERIAL AND, WHETHER OR NOT YOU PLAN TO BE PRESENT IN PERSON AT THE SPECIAL
MEETING, TO FILL IN, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD(S) AS SOON AS
POSSIBLE TO ASSURE THAT YOUR VOTES WILL BE COUNTED.  THIS WILL NOT PREVENT YOU
FROM VOTING IN PERSON IF YOU ATTEND THE SPECIAL MEETING.
<PAGE>
 
                                                GLOSSARY 

Association                          Northfield Federal Savings converting      
                                     from mutual to stock form, in its          
                                     mutual form and the federally              
                                     chartered stock savings association        
                                     resulting from the Association's           
                                     conversion from mutual to stock form       
                                                                                
Bank                                 Northfield Federal Savings Bank, a         
                                     federally chartered stock savings bank     
                                                                                
Company                              The corporation named Northfield           
                                     Bancorp, Inc. formed by the                
                                     Association to serve as its holding        
                                     company after the Conversion               
                                                                                
Community Offering                   The offering of shares of the common       
                                     stock to the general public                
                                     concurrently with or after                 
                                     commencement of the Subscription           
                                     Offering, giving preference to             
                                     natural persons and trusts of natural      
                                     persons (including individual              
                                     retirement and Keogh retirement            
                                     accounts and personal trusts in which      
                                     such natural persons have substantial      
                                     interests) who are permanent               
                                     residents of the Association's Local       
                                     Community                                  
                                                                                
Conversion                           Conversion of the Association from         
                                     mutual to stock form, the issuance of      
                                     the Bank's outstanding common stock        
                                     to the Company and the issuance of         
                                     the Company's outstanding common           
                                     stock to purchasers in the                 
                                     Subscription Offering and, if any,         
                                     the Community Offering and/or              
                                     Syndicated Offering                        
                                                                                
Eligible Account Holders             Holders of savings accounts at the         
                                     Association with balances of at least      
                                     $50.00 as of December 31, 1995             
                                                                                
ESOP                                 Employee Stock Ownership Plan to be        
                                     implemented by the Company in the          
                                     Conversion                                 
                                                                                
Estimated Valuation Range            Range of valuation from 15% below to       
                                     15% above the independent appraisal        
                                     of our estimated pro forma market          
                                     value, which was $4,500,000 as of          
                                     February 27, 1997                          
                                                                                
FDIC                                 Federal Deposit Insurance Corporation      
                                                                                
Ferguson                             Ferguson & Company, the firm we            
                                     engaged to prepare the appraisal of        
                                     our estimated pro forma market value       
                                     in the Conversion                          
                                                                                
Local Community                      The county where our offices are           
                                     located -- Baltimore County, Maryland      
                                                                                
Other Members                        Depositor and borrower members of the      
                                     Association as of ______ __, 1998.         
                                                                                
OTS                                  Office of Thrift Supervision of the        
                                     United States Department of the            
                                     Treasury                                   
                                                                                
SEC                                  Securities and Exchange Commission         
                                                                                
Subscription Offering                The offering of  shares of the common      
                                     stock to Eligible Account Holders,         
                                     the ESOP, Supplemental Eligible            
                                     Account Holders and Other Members          
                                                                                
Supplemental Eligible Account        Holders of savings accounts at the         
Holders                              Association with balances of at least      
                                     $50.00 as of March 31, 1998                
                                                                                
Syndicated Offering                  If any, the offering of shares of the      
                                     common stock to the general public         
                                     after the Subscription and Community       
                                     Offerings in a syndicated offering by      
                                     selected dealers                           
                                                                                
Trident Securities                   Trident Securities, Inc., the firm we      
                                     engaged to advise and assist us in         
                                     the marketing of the common stock and      
                                     the conduct of the Subscription            
                                     Offering and, if any, the Community        
                                     Offering and/or Syndicated Offering 
<PAGE>
 
                             QUESTIONS AND ANSWERS

     Set forth below are answers to frequently asked questions about the
procedures for voting on the Plan of Conversion and related matters. For
additional information about the Conversion, please refer to the more detailed
information contained in this proxy statement and the accompanying prospectus.
For assistance, please contact the Stock Information Center at (410) 668-2160.

ABOUT VOTING "FOR" THE PLAN OF CONVERSION

1.   Am I eligible to vote at the Special Meeting of Members to be held to
     consider the Plan of Conversion?

     You are eligible to vote at the Special Meeting of Members to be held on
     _________, 1998 if you were a depositor or borrower of Northfield Federal
     Savings at the close of business on the Voting Record Date (_______, 1998)
     and continue as such until the Special Meeting.  If you were a member on
     the Voting Record Date, you should have received a proxy statement and a
     proxy card with which to vote.
 
2.   How many votes do I have?

     As an account holder of ours, you have one vote for each $100, or fraction
     thereof, on deposit in your account(s) with us.  Each borrower member may
     cast one vote in addition to the number of votes, if any, he or she is
     entitled to cast as an account holder.  No member may cast more than 1,000
     votes.

3.   If I vote "against" the Plan of Conversion and it is approved, will I be
     prohibited from buying stock during the Subscription Offering?

     No.  Voting against the Plan of Conversion in no way restricts you from
     purchasing the common stock of our holding company in the Subscription
     Offering.

4.   Did the Board of Directors of Northfield Federal Savings unanimously adopt
     the Plan of Conversion?

     Yes.  Our Board of Directors unanimously adopted the Plan of Conversion and
     urges that all members vote "FOR" approval of the Plan of Conversion.

5.   What happens if Northfield Federal Savings does not get enough votes to
     approve the Plan of Conversion?

     The Conversion would not take place, and we would remain a mutual savings
     association.

6.   As a qualifying depositor or borrower of Northfield Federal Savings, am I
     required to vote?

     No.  However, failure to return your proxy card or otherwise vote will have
     the same effect as a vote AGAINST the Plan of Conversion.

7.   What is a Proxy Card?

     A proxy card gives you the ability to vote without attending the Special
     Meeting in person.  If you received more than one informational packet,
     then you should vote the proxy cards in all packets.  Your proxy card(s) is
     (are) located in the window sleeve of your informational packet(s).

     You may attend the meeting and vote, even if you have returned your proxy
     card, if you choose to do so. However, if you are unable to attend, you
     still are represented by proxy.  Previously executed proxies, other than
     those proxies related to the Conversion which were sent to you, will not be
     used to vote for approval of the Plan of Conversion, even if you do not
     execute another proxy or attend the Special Meeting and vote in person.
<PAGE>
 
8.   How can I get further information concerning the stock offering?

     You may call the Stock Information Center at (410) 668-2160 for further
     information or to request a copy of the prospectus, a Stock Order Form, a
     proxy statement or a proxy card.


     THIS INFORMATION DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF
AN OFFER TO BUY NORTHFIELD BANCORP, INC. COMMON STOCK.  SUCH OFFERS AND
SOLICITATIONS MAY BE MADE ONLY BY MEANS OF THE PROSPECTUS.  COPIES OF THE
PROSPECTUS MAY BE OBTAINED BY CALLING THE STOCK INFORMATION CENTER AT (410) 668-
2160.

     THE SHARES OF NORTHFIELD BANCORP, INC. COMMON STOCK BEING OFFERED ARE NOT
SAVINGS OR DEPOSIT ACCOUNTS AND ARE NOT INSURED BY THE SAVINGS ASSOCIATION
INSURANCE FUND OF THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENT AGENCY.
<PAGE>
 
                          NORTHFIELD FEDERAL SAVINGS
                               8005 HARFORD ROAD
                           BALTIMORE, MARYLAND 21234
                                (410) 665-7900


                                PROXY STATEMENT


     YOUR PROXY, IN THE FORM ENCLOSED, IS SOLICITED BY OUR BOARD FOR USE AT A
SPECIAL MEETING OF OUR MEMBERS TO BE HELD ON _________________________ ___, 1998
AND ANY ADJOURNMENT OF THAT MEETING, FOR THE PURPOSES SET FORTH IN THE FOREGOING
NOTICE OF SPECIAL MEETING. OUR BOARD OF DIRECTORS URGES YOU TO VOTE FOR THE PLAN
OF CONVERSION.

                         PURPOSE OF MEETING -- SUMMARY

     A Special Meeting of Members (the "Special Meeting") of Northfield Federal
Savings (the "Association") will be held at
___________________________________________________, Baltimore, Maryland on
_________________, _____________, 1998, at __:__ .m., Eastern Time, for the
purpose of considering and voting upon a Plan of Conversion, which was
unanimously adopted by our Board of Directors and which, if approved by a
majority of the total votes eligible to be cast by the members, will permit us
to convert from a federal mutual savings association to a federal stock savings
bank, with the name "Northfield Bancorp, Inc. (the "Bank), and the Bank becoming
a wholly owned subsidiary of Northfield Bancorp, Inc. (the "Company"), a
Maryland corporation which we formed for the purpose of becoming our holding
company. Our conversion and the acquisition of us by the Company is referred to
in this Proxy Statement as the "Conversion". The Conversion is contingent upon
our members' approval of the Plan of Conversion at the Special Meeting or any
adjournment of the Special Meeting.

     The Plan of Conversion provides in part that after receiving final
authorization from the Office of Thrift Supervision ("OTS"), the Company will
offer for sale shares of its common stock, par value $.01 per share (the "Common
Stock"), through the issuance of nontransferable subscription rights, first to
our depositors as of December 31, 1995 with $50.00 or more on deposit with us on
that date ("Eligible Account Holders"), second to the Company's Employee Stock
Ownership Plan of Conversion (the "ESOP") (a tax-qualified employee stock
benefit plan of the Company, as defined in the Plan of Conversion), third to our
depositors, with $50.00 or more on deposit with us on March 31, 1998, who are
not Eligible Account Holders ("Supplemental Eligible Account Holders"), and
fourth to other members, i.e., our depositors and borrower members, other than
Eligible Account Holders and Supplemental Eligible Account Holders, on
______________ ___, 1998 ("Other Members") (the "Subscription Offering").
Subscription rights received in any of the foregoing categories will be
subordinated to the subscription rights of those in a prior category, with the
exception that any shares of Common Stock sold in excess of the high end of the
estimated value range as established in an independent appraisal, as discussed
below, may be first sold to the ESOP. During or after the Subscription Offering,
the Company may offer shares of the Common Stock not sold in the Subscription
Offering to the general public, in a community offering (the "Community
Offering"). In the Community Offering, preference may be given to natural
persons and trusts of natural persons who are permanent residents of our local
community, Baltimore County, Maryland. Any shares of Common Stock not purchased
in the Subscription and Community Offerings may be sold to a syndicate of
underwriters to be managed by Trident Securities, Inc. ("Trident Securities").
The aggregate price of the Common Stock to be issued by the Company under the
Plan of Conversion is currently estimated to be between $3,825,000 and
$5,175,000, subject to adjustment, as determined by an independent appraisal of
our estimated pro forma market value as converted and as a wholly owned
subsidiary of the Company. For a period of 30 days following the closing of the
Conversion, the Company's Board of Directors may determine to issue up to an
additional 3% of the shares issued in the Conversion. These shares, the
"Contingent Shares," may be issued if necessary in the discretion of the Board,
to fill orders resulting from allocation oversights resulting in an
oversubscription, lost or damaged stock order forms which the Board determines
legitimately should have been filled during the Conversion, or orders initially
rejected but later found to be legitimate. Any Contingent Shares issued will not
be included in the total number of shares
<PAGE>
 
for purposes of determining the level of stock to be purchased by the ESOP or
other stock benefit plans of the Company. Contingent Shares will be allocated to
a subscriber based on the allocation of shares to persons who had the same or
similar deposit account balance as that subscriber.  See "The Conversion --
Stock Pricing" and " -- Contingent Shares" in the accompanying prospectus.

     Adoption of the proposed Stock Charter and Bylaws of Northfield Federal
Savings Bank is an integral part of the Plan of Conversion. Copies of the Plan
of Conversion and the proposed Stock Charter and Bylaws are attached to this
Proxy Statement. These documents provide, among other things, for the
termination of voting rights of members and their rights to receive any surplus
remaining in the event of our liquidation. These rights, except for the rights
of Eligible Account Holders and Supplemental Eligible Account Holders in the
liquidation account established for their benefit upon completion of the
Conversion, will vest exclusively in the Company as the sole holder of our
outstanding capital stock.

                   RECOMMENDATION OF THE BOARD OF DIRECTORS

     YOUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" APPROVAL
OF THE PLAN OF CONVERSION. VOTING IN FAVOR OF THE PLAN OF CONVERSION WILL NOT
OBLIGATE ANY PERSON TO PURCHASE STOCK.

     The Conversion will be accomplished through adoption of a new Charter and
Bylaws to authorize our issuance of capital stock to the Company. Under the Plan
of Conversion, 450,000 shares of the Common Stock, subject to adjustment, are
being offered for sale by the Company. Upon completion of the Conversion, we
will issue all of our newly issued shares of capital stock (100,000 shares) to
the Company in exchange for at least 50% of the net proceeds in the Conversion.
None of our assets will be distributed in order to effect the Conversion other
than to pay expenses incurred as a result of the Conversion.

     The net proceeds from the sale of Common Stock in the Conversion will
substantially increase our capital, which will increase the amount of funds
available for lending and investment, and support current operations and the
continued growth of our business. The holding company structure will provide
greater flexibility than we alone would have for diversification of business
activities and geographic operations. We believe that this increased capital and
operating flexibility will enable us to compete more effectively with other
savings institutions and other types of financial service organizations. We also
believe that the Conversion will enhance the future access of both ourselves and
the Company to the capital markets.

                           NORTHFIELD BANCORP, INC.

     The Company was formed as a Maryland corporation in March 1998 at our
direction for the purpose of serving as our holding company after the
Conversion. Prior to the Conversion, the Company has not engaged and is not
expected to engage in any material operations. The Company has received the
approval of the OTS to acquire control of us upon completion of the Conversion.
Upon consummation of the Conversion, the only assets the Company is expected to
own are the Bank's capital stock issued in the Conversion, a note receivable
from our ESOP and any proceeds from the offering the Company retains.

     As a holding company, the Company will have greater flexibility than we
would have to diversify its business activities through the formation of
subsidiaries or through acquisition. The Company will be classified as a unitary
savings and loan holding company after the Conversion and will be required to
comply with OTS regulations and be subject to examination.

     The Company's executive offices are located at 8005 Harford Road,
Baltimore, Maryland 21234 and its main telephone number is (410) 665-7900.

                                       2
<PAGE>
 
                          NORTHFIELD FEDERAL SAVINGS

     We are a federal mutual savings association operating through two offices
in Baltimore County, Maryland. We were founded in 1923 as a federally chartered
institution and are a member of the Federal Home Loan Bank System. Our deposits
are insured up to applicable limits by the Federal Deposit Insurance Corporation
("FDIC") under the Savings Association Insurance Fund.  At December 31, 1997, we
had total assets of $36.1 million, total deposits of $32.6 million and total
retained earnings of $2.9 million.

     Our principal business consists of attracting deposits, primarily
certificates of deposit, from the general public and originating residential
mortgage loans, primarily construction/permanent loans on one- to four-family
properties. We also offer commercial real estate and limited types of consumer
loans.  We also have a portfolio of purchased commercial leases.

     Our executive offices are located at 8005 Harford Road, Baltimore, Maryland
21234 and our main telephone number is (410) 665-7900.

             INFORMATION RELATING TO VOTING AT THE SPECIAL MEETING

     Our Board of Directors has fixed the close of business on ________ ___,
1998 as the record date (the "Voting Record Date") for the determination of
members entitled to notice of and to vote at the Special Meeting.  Under our
current mutual charter, our members include all holders of deposit or other
authorized accounts and certain of our borrowers.  All members of record as of
the close of business on the Voting Record Date who remain members until the
date of the Special Meeting will be entitled to vote at the Special Meeting or
any adjournment thereof.

     At the Special Meeting each depositor member may cast one vote for each
$100, or fraction thereof, of the aggregate withdrawal value of all of his or
her savings accounts with us as of the Voting Record Date.  Each borrower member
will be entitled to one vote in addition to the number of votes to which he or
she is entitled as a depositor.  No member may cast more than 1,000 votes.

     Approval of the Plan of Conversion to be presented at the Special Meeting
will require the affirmative vote of at least a majority of the total
outstanding votes of our members eligible to be cast at the Special Meeting.  As
of the Voting Record Date for the Special Meeting, there were approximately
_____ votes eligible to be cast, of which _____ votes constitute a majority.

     Members may vote at the Special Meeting or any adjournment thereof in
person or by proxy.  All properly executed proxies received by us will be voted
in accordance with the instructions indicated on the proxies by the members
giving such proxies.  If no contrary instructions are given, proxies will be
voted in favor of the Plan of Conversion.  If any other matters are properly
presented before the Special Meeting and may properly be voted upon, the proxies
solicited hereby will be voted on such matters by the proxy holders named
therein as directed by our Board of Directors.  Valid, previously executed
general proxies, which typically are obtained from members when they open their
accounts with us, will not be used to vote for approval of the Plan of
Conversion, even if the respective members do not execute another proxy or
attend the Special Meeting and vote in person.  You have the right to revoke
your proxy at any time before the voting at the Special Meeting by delivering
either written notice or a duly executed proxy bearing a later date to the
Secretary of Northfield Federal Savings.  The Secretary must receive this
written notice or the later-dated proxy prior to the Special Meeting or any
adjournment thereof.  You may also revoke your proxy by attending the Special
Meeting and voting in person.

     FAILURE TO RETURN AN EXECUTED PROXY FOR THE SPECIAL MEETING OR TO ATTEND
THE SPECIAL MEETING IN ORDER TO VOTE IN PERSON WOULD HAVE THE SAME EFFECT AS
VOTING AGAINST THE CONVERSION.

     Proxies may be solicited by our officers, directors or other employees, in
person, by telephone or through other

                                       3
<PAGE>
 
forms of communication.  These persons will be reimbursed by us only for their
expenses incurred in connection with such solicitation.

     The proxies solicited hereby will be used only at the Special Meeting and
at any adjournment thereof; they will not be used at any other meeting.

                       DESCRIPTION OF PLAN OF CONVERSION

     THE OTS HAS APPROVED OUR PLAN OF CONVERSION (THE "PLAN"), SUBJECT TO THE
APPROVAL OF THE PLAN OF CONVERSION BY OUR MEMBERS AT THE SPECIAL MEETING, AND
SUBJECT TO THE SATISFACTION OF CERTAIN OTHER CONDITIONS IMPOSED BY THE OTS IN
ITS APPROVAL.  OTS APPROVAL, HOWEVER, DOES NOT CONSTITUTE A RECOMMENDATION OR
ENDORSEMENT OF THE PLAN OF CONVERSION BY THE OTS.

GENERAL

     On December 17, 1997, our board of directors adopted a Plan of Conversion,
which was amended on March 25, 1998, pursuant to which we will convert from a
federally chartered mutual savings association to a federally chartered stock
savings stock, and will adopt the name "Northfield Federal Savings Bank" (the
"Bank") and the Bank will become a wholly owned subsidiary of the Company.  The
Conversion will include adoption of the proposed Federal Stock Charter and
Bylaws of the Bank which will authorize the issuance of capital stock.  Under
the Plan, the Bank's capital stock is being sold to the Company and the Common
Stock of the Company is being offered to our customers and then to the public.

     The OTS has approved the Company's application to become a savings and loan
holding company and to acquire all of our capital stock to be issued in the
Conversion.  Pursuant to such OTS approval, the Company plans to retain 50% of
the net proceeds from the sale of shares of Common Stock and to use the
remaining 50% to purchase all of the capital stock we will issue in the
Conversion.

     The shares are first being offered in a Subscription Offering to holders of
subscription rights.  To the extent shares of Common Stock remain available
after the Subscription Offering, we may offer shares of Common Stock in a
Community Offering.  The Community Offering, if any, may begin anytime
subsequent to the beginning of the Subscription Offering.  Shares not subscribed
for in the Subscription and Community Offerings may be offered for sale by the
Company in a Syndicated Community Offering.  We have the right, in our sole
discretion, to accept or reject, in whole or in part, any orders to purchase
shares of Common Stock received in the Community and Syndicated Community
Offering.

     We must sell Common Stock in an amount equal to our pro forma market value
as a stock savings institution in order for the Conversion to become effective.
We must complete the Community Offering within 45 days after the last day of the
Subscription Offering, unless we extend such period and obtain the approval of
the OTS to do so.  The Plan provides that the Conversion must be completed
within 24 months after the date of the approval of the Plan by our members.

     In the event that we are unable to complete the sale of Common Stock and
effect the Conversion within 45 days after the end of the Subscription Offering,
we may request an extension of the period by the OTS.  We cannot assure you that
the extension would be granted if requested, nor can we assure you  that our
valuation would not substantially change during any such extension.  If the
Estimated Valuation Range of the shares must be amended, we cannot assure that
the OTS would approve such amended Estimated Valuation Range.  Therefore, it is
possible that if the Conversion cannot be completed within the requisite period
of time, we may not be permitted to complete the Conversion.  A substantial
delay caused by an extension of the period may also significantly increase the
expense of the Conversion. We cannot sell any shares of Common Stock unless the
Plan is approved by our members.

     The completion of the offering is subject to market conditions and other
factors beyond our control.  We cannot

                                       4
<PAGE>
 
give you any assurances as to the length of time following approval of the Plan
at the meeting of our members that will be required to complete the Community
Offering or other sale of the shares being offered in the Conversion.  If we
experience delays, our Estimated Valuation Range upon Conversion could change
significantly, together with corresponding changes in the offering price and the
net proceeds to be realized by us from the sale of the shares.  In the event we
terminate the Conversion, we would be required to charge all Conversion expenses
against current income and promptly return any funds collected by us in the
offering to each potential investor, plus interest at the prescribed rate.

EFFECTS OF CONVERSION TO STOCK FORM ON DEPOSITORS AND BORROWERS OF NORTHFIELD
FEDERAL SAVINGS

     VOTING RIGHTS.  Currently in our mutual form, our depositor and borrower
members have voting rights and may vote for the election of directors.
Following the Conversion, depositors and borrower members will cease to have
voting rights.

     SAVINGS ACCOUNTS AND LOANS.  The Conversion will not affect the balances,
terms and FDIC insurance coverage of savings accounts, nor will the amounts and
terms of loans and obligations of the borrowers under their individual
contractual arrangements with us be affected.

     TAX EFFECTS.  We have received an opinion from our counsel, Housley
Kantarian & Bronstein,  P.C. on the federal tax consequences of the Conversion.
The opinion is an exhibit to the registration statement of which the
accompanying prospectus is a part.  The opinion provides, in part, that,:  (i)
the Conversion will qualify as a reorganization under Section 368(a)(1)(F) of
the Internal Revenue Code, and we will not recognize any taxable gain in either
our mutual form or our stock form as a result of the proposed Conversion; (ii)
we will not recognize any taxable gain upon the receipt of money from the
Company for our stock, nor will the Company recognize any gain upon the receipt
of money for the Common Stock; (iii) our assets in either our mutual or our
stock form will have the same basis before and after the Conversion; (iv) the
holding period of our assets will include the period during which the assets
were held by us in our mutual form prior to Conversion; (v) no gain or loss will
be recognized by the Eligible Account Holders, Supplemental Eligible Account
Holders and Other Members upon the issuance to them of withdrawable savings
accounts in us in the stock form in the same dollar amount as their savings
accounts in us in the mutual form plus an interest in the liquidation account of
us in the stock form in exchange for their savings accounts in us in the mutual
form; (vi) depositors will recognize gain or loss upon the receipt of
liquidation rights and the receipt of subscription rights in the Conversion, to
the extent such liquidation rights and subscription rights are deemed to have
value, as discussed below; (vii) the basis of each account holder's savings
accounts in us after the Conversion will be the same as the basis of his savings
accounts in us prior to the Conversion, decreased by the fair market value of
the nontransferable subscription rights received and increased by the amount, if
any, of gain recognized on the exchange; (viii) the basis of each account
holder's interest in the liquidation account will be zero; and (ix) the holding
period of the Common Stock acquired through the exercise of subscription rights
shall begin on the date on which the subscription rights are exercised.

     With respect to the subscription rights, we have received an opinion of
Ferguson which, based on certain assumptions, concludes that the subscription
rights to be received by Eligible Account Holders and other eligible subscribers
do not have any economic value at the time of distribution or at the time the
subscription rights are exercised, whether or not a public offering takes place.
Such opinion is based on the fact that such rights are: (i) acquired by the
recipients without payment therefor, (ii) non-transferable, (iii) of short
duration, and (iv) afford the recipients the right only to purchase shares at a
price equal to their estimated fair market value, which will be the same price
at which shares for which no subscription right is received in the Subscription
Offering will be offered in the Community Offering.  If the subscription rights
granted to Eligible Account Holders or other eligible subscribers are deemed to
have an ascertainable value, receipt of such rights would be taxable only to
those Eligible Account Holders or other eligible subscribers who exercise the
subscription rights in an amount equal to such value (either as a capital gain
or ordinary income), and we could recognize gain on such distribution.

     We are also subject to Maryland income taxes and have received an opinion
from Anderson Associates, llp that the Conversion will be treated for Maryland
state tax purposes similar to the Conversion's treatment for federal tax

                                       5
<PAGE>
 
purposes.

     Unlike a private letter ruling, the opinions of Housley Kantarian &
Bronstein, P.C., Ferguson and Anderson Associates, llp have no binding effect or
official status, and we cannot give you any assurance that a court would sustain
the conclusions reached in any of those opinions if contested by the IRS or the
Maryland tax authorities.  WE ENCOURAGE ELIGIBLE ACCOUNT HOLDERS, SUPPLEMENTAL
ELIGIBLE ACCOUNT HOLDERS AND OTHER MEMBERS TO CONSULT WITH THEIR OWN TAX
ADVISERS AS TO THE TAX CONSEQUENCES IN THE EVENT THE SUBSCRIPTION RIGHTS ARE
DEEMED TO HAVE AN ASCERTAINABLE VALUE.

     LIQUIDATION ACCOUNT.  In the unlikely event of our complete liquidation in
our present mutual form, each depositor is entitled to equal distribution of any
of our assets, pro rata to the value of his accounts, remaining after payment of
claims of all creditors (including the claims of all depositors to the
withdrawal value of their accounts). Each depositor's pro rata share of such
remaining assets would be in the same proportion as the value of his deposit
accounts was to the total value of all deposit accounts in us at the time of
liquidation.

     Upon a complete liquidation after the Conversion, each depositor would have
a claim, as a creditor, of the same general priority as the claims of all other
general creditors of ours.  Therefore, except as described below, a depositor's
claim would be solely in the amount of the balance in his deposit account plus
accrued interest.  A depositor would not have an interest in the residual value
of our assets above that amount. if any.

     The Plan of Conversion provides for the establishment, upon the completion
of the Conversion, of a special "liquidation account" for the benefit of
Eligible Account Holders and Supplemental Eligible Account Holders in an amount
equal to our regulatory capital as reflected in the latest statement of
financial condition set forth in the accompanying prospectus.  Each Eligible
Account Holder and Supplemental Eligible Account Holder, if he continues to
maintain his deposit account with us, would be entitled on our complete
liquidation after Conversion, to an interest in the liquidation account prior to
any payment to stockholders.  Each Eligible Account Holder would have an initial
interest in such liquidation account for each deposit account held in us on the
qualifying date, December 31, 1995.  Each Supplemental Eligible Account Holder
would have a similar interest as of the qualifying date, March 31, 1998.  The
interest as to each deposit account would be in the same proportion of the total
liquidation account as the balance of the deposit account on the qualifying
dates was to the aggregate balance in all the deposit accounts of Eligible
Account Holders and Supplemental Eligible Account Holders on such qualifying
dates.  However, if the amount in the deposit account on any annual closing date
of ours is less than the amount in such account on the respective qualifying
dates, then the interest in this special liquidation account would be reduced
from time to time by an amount proportionate to any such reduction, and the
interest would cease to exist if such deposit account were closed.  The interest
in the special liquidation account will never be increased despite any increase
in the related deposit account after the respective qualifying dates.

     No merger, consolidation, purchase of bulk assets with assumptions of
savings accounts and other liabilities, or similar transactions with another
insured institution in which transaction we, in our converted form, are not the
surviving institution shall be considered a complete liquidation.  In such
transactions, the liquidation account shall be assumed by the surviving
institution.

RESTRICTIONS ON SALES AND PURCHASES OF SHARES BY DIRECTORS AND OFFICERS

     Shares purchased by directors and officers of the Company may not be sold
for one year following completion of the Conversion.  An exception to this rule
is a disposition of shares in the event of the death of the director or officer.
Any shares issued to directors and officers as a stock dividend, stock split, or
otherwise with respect to restricted stock shall be subject to the same
restrictions.

     For three years following the Conversion, directors and officers may
purchase shares only through a registered broker or dealer.  Exceptions are
available only if the OTS has approved the purchase or the purchase is an arm's
length transaction and involves more than one percent of the outstanding shares.

                                       6
<PAGE>
 
INTERPRETATION AND AMENDMENT OF THE PLAN OF CONVERSION

     We are authorized to interpret and amend the Plan of Conversion.  Our
interpretations are final.  Amendments to the Plan of Conversion after the
receipt of member approval will not need further member approval unless required
by the OTS.

CONDITIONS AND TERMINATION

     Completion of the Conversion requires (i) the approval of the Plan of
Conversion by the affirmative vote of not less than a majority of the total
number of votes eligible to be cast by our members; and (ii) completion of the
sale of shares within 24 months following approval of the Plan of Conversion by
our members.  If these conditions are not satisfied, the Plan of Conversion will
be terminated and we will continue our business in the mutual form of
organization.  We may terminate the Plan of Conversion at any time prior to the
meeting of members to vote on the Plan or at any time thereafter with the
approval of the OTS.

OTHER

     All statements made in this Proxy Statement are hereby qualified by the
contents of the Plan of Conversion which is attached as Exhibit A to this Proxy
Statement.  Please consult the Plan of Conversion for further information. In
addition, please refer to the section entitled "The Conversion" in the
accompanying prospectus for a more detailed discussion of various aspects of the
Plan of Conversion.

                              CHARTER AND BYLAWS

     The following is a summary of certain provisions of the Charter and Bylaws
which will become effective upon our conversion into a federally chartered stock
savings bank.  Complete copies of the Stock Charter and Bylaws are attached as
Exhibits B and C to this Proxy Statement.

     In stock form, we will be authorized to issue 8,000,000 shares of common
stock, $0.01 par value per share. Our common stock will not be insured by the
FDIC.  All of our outstanding common stock will be owned by the Company.
Accordingly, exclusive voting rights with respect to our affairs after the
Conversion will be vested in the Company's Board of Directors.

     Our Charter provides that the number of directors shall be not fewer than
five or more than 15, with the exact number to be fixed in the Bylaws.  The
proposed Stock Bylaws provide that the number directors shall be six.  Directors
will serve for terms of three years and the terms of directors will be staggered
so that approximately one-third of the Board is elected each year.

     In addition to the common stock, we will be authorized to issue 2,000,000
shares of serial preferred stock, $0.01 par value per share.  The Board of
Directors will be permitted, without further stockholder approval, to authorize
the issuance of preferred stock in series and to fix the voting powers,
designations, preferences and relative, participating, optional, conversion and
other special rights of the shares of each series of the preferred stock and the
qualifications, limitations and restrictions thereof.  Preferred stock may rank
prior to common stock in dividend rights, liquidation preferences, or both, and
may have voting rights.

     Neither the Stock Charter nor the Bylaws provide for indemnification of
officers and directors.  However, we will be required by OTS regulations (as we
currently are) to indemnify its directors, officers and employees against legal
and other expenses incurred in defending lawsuits brought against them by
reasons of the performance of their official duties.  Indemnification may be
made to any such person only if final judgment on the merits is in his favor or,
in case of (i) settlement, (ii) final judgment against him or (iii) final
judgment in his favor, other than on the merits, if a majority of our directors
determines that he was acting in good faith within the scope of his employment
or authority as he could reasonably have perceived it under the circumstances
and for a purpose he could have reasonably believed under the circumstances was
in our best interest or the best interest of our stockholders.  If a majority of
our directors concludes

                                       7
<PAGE>
 
that in connection with an action any person ultimately may become entitled to
indemnification, the directors may authorize payment of reasonable costs and
expenses arising from defense or settlement of such action.

                              HOW TO ORDER STOCK

     The accompanying prospectus contains information about our business and
financial condition of the and additional information about the Conversion and
the Subscription Offering and the Community Offering.  Enclosed is a Stock Order
Form you must use to purchase for stock.  You are not obligated to purchase
stock and voting to approve the Conversion will not obligate you to purchase for
stock.

     All Subscription Rights are nontransferable and will expire if you do not
exercise them by returning the accompanying Stock Order Form with full payment
(or appropriate instructions authorizing withdrawal from a savings or
certificate account with us) for all shares for which subscription is made to
the Company by __:__ .m., Eastern Time, on ________ ___, 1998, unless extended
by us.  A postage-paid reply envelope is provided for this purpose.  If not all
of the shares are subscribed for in the Subscription Offering by our members,
the remaining shares may be offered to the general public in the Community
Offering with preference given to natural persons and trusts of natural persons
who reside in Baltimore County, Maryland.

     THE INFORMATION CONTAINED IN THIS PROXY STATEMENT IS LIMITED IN ITS SCOPE
TO USE IN THE SOLICITATION OF PROXIES FOR THE SPECIAL MEETING TO VOTE ON THE
PLAN OF CONVERSION.  IT IS NOT INTENDED FOR USE IN THE OFFERING OF THE COMMON
STOCK.  SUCH OFFERING IS MADE ONLY BY THE ACCOMPANYING PROSPECTUS.

                            ADDITIONAL INFORMATION

     The information contained in the accompanying prospectus includes a more
detailed description of the Plan of Conversion and is intended to help you
evaluate the Conversion.

     All persons eligible to vote at the Special Meeting should review both this
Proxy Statement and the accompanying prospectus carefully.

     YOUR BOARD OF DIRECTORS URGES YOU TO CONSIDER CAREFULLY THIS PROXY MATERIAL
AND, WHETHER OR NOT YOU PLAN TO BE PRESENT IN PERSON AT THE SPECIAL MEETING, TO
FILL IN, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD(S) AS SOON AS POSSIBLE TO
ASSURE THAT YOUR VOTES WILL BE COUNTED.  THIS WILL NOT PREVENT YOU FROM VOTING
IN PERSON IF YOU ATTEND THE SPECIAL MEETING.  YOU MAY REVOKE YOUR PROXY BY
WRITTEN INSTRUMENT DELIVERED TO THE SECRETARY OF NORTHFIELD FEDERAL SAVINGS AT
ANY TIME PRIOR TO OR AT THE SPECIAL MEETING OR BY ATTENDING THE SPECIAL MEETING
AND VOTING IN PERSON.

     THIS PROXY STATEMENT IS NOT AN OFFER TO SELL OR THE SOLICITATION OF AN
OFFER TO BUY THE COMMON STOCK.  THE OFFER IS MADE ONLY BY THE ACCOMPANYING
PROSPECTUS.

                              BY ORDER OF THE BOARD OF DIRECTORS


                              J. Thomas Hoffman
                              Secretary
______________, 1998
Baltimore, Maryland

                                       8
<PAGE>
 
                                                                       Exhibit A
                          Northfield Federal Savings
                              Baltimore, Maryland

                              PLAN OF CONVERSION
                       FROM MUTUAL TO STOCK ORGANIZATION


I.  General.

     On December 17, 1997, the Board of Directors of Northfield Federal Savings,
Baltimore, Maryland (the "Bank"), after careful study and consideration, adopted
this Plan of Conversion from Mutual to Stock Organization (the "Plan"), whereby
the Bank will convert from a federal mutual savings Bank to a federal capital
stock savings Bank (the "Converted Bank") as a wholly owned subsidiary of a
Holding Company to be formed at the direction of the Bank (the "Conversion").

     The Conversion is subject to regulations of the Director of the Office of
Thrift Supervision of the United States Department of the Treasury ("OTS")
pursuant to Section 5(i) of the Home Owners' Loan Act and Part 563b of the Rules
and Regulations Applicable to All Savings Associations.

     The Plan is subject to the prior written approval of the OTS and must be
adopted by the affirmative vote of at least a majority of the total outstanding
votes of the Members of the Bank.  Pursuant to the Plan, shares of Conversion
Stock in the Holding Company will be offered in a Subscription Offering pursuant
to non-transferable Subscription Rights at a predetermined and uniform price
first to the Bank's Eligible Account Holders of record as of December 31, 1995,
second to the Bank's Tax-Qualified Employee Stock Benefit Plans, third to
Supplemental Eligible Account Holders of record as of the last day of the
calendar quarter preceding OTS approval of the Bank's application to convert to
stock form and fourth to Other Members of the Bank.  Concurrently with the
Subscription Offering, shares not subscribed for in the Subscription Offering
may be offered by the Bank to the general public in a Community Offering.
Shares remaining, if any, may then be offered to the general public in an
underwritten public offering or otherwise.  The aggregate Purchase Price of the
Conversion Stock will be based upon an independent appraisal of the Bank and
will reflect the estimated pro forma market value of the Converted Bank, as a
subsidiary of the Holding Company.

     It is the desire of the Board of Directors to attract new capital to the
Converted Bank to increase its net worth, to support future savings growth, to
increase the amount of funds available for other lending and investment, to
provide greater resources for the expansion of customer services and to
facilitate future expansion. In addition, the Board of Directors currently
intends to implement stock option plans and other stock benefit plans subsequent
to the Conversion to better attract and retain qualified directors and officers.
It is the further desire of the Board of Directors to reorganize the Converted
Bank as the wholly owned subsidiary of the Holding Company to enhance
flexibility of operations, diversification of business opportunities and
financial capability for business and regulatory purposes and to enable the
Converted Bank to compete more effectively with other financial service
organizations.

     No change will be made in the Board of Directors or management of the Bank
as a result of the Conversion.

II.  Definitions.

     Acting in Concert:  The term "Acting in Concert" means (i) knowing
     -----------------                                                 
participation in a joint activity or interdependent conscious parallel action
towards a common goal whether or not pursuant to an express agreement; or (ii) a
combination or pooling of voting or other interests in the securities of an
issuer for a common purpose pursuant to any contract, understanding,
relationship, agreement or other arrangement, whether written or otherwise.  A
person (as defined by 12 C.F.R. (S)563b.2(a)(26)) who acts in concert with
another person ("other party") shall also be deemed to be acting in concert with
any person who is also acting in concert with that other party, except that any
Tax-Qualified
 

                                      A-1
<PAGE>
 
Employee Stock Benefit Plan will not be deemed to be acting in concert with its
trustee or a person who serves in a similar capacity solely for the purpose of
determining whether stock held by the trustee and stock held by the Tax-
Qualified Employee Benefit Plan will be aggregated.

     Associate:  The term "Associate," when used to indicate a relationship with
     ---------                                                                  
any person, means (i) any corporation or organization (other than the Bank, the
Holding Company or a majority-owned subsidiary of the Bank or the Holding
Company) of which such person is an officer or partner or is, directly or
indirectly, the beneficial owner of 10% or more of any class of equity
securities; (ii) any trust or other estate in which such person has a
substantial beneficial interest or as to which such person serves as trustee or
in a similar fiduciary capacity, except that such term shall not include a "Tax-
Qualified Employee Stock Benefit Plan," as defined herein; and (iii) any
relative or spouse of such person, or any relative of such spouse, who has the
same home as such person or who is a director of the Bank or the Holding
Company, or any of their subsidiaries.

     Bank:  The term "Bank" means Northfield Federal Savings, either in its
     ----                                                                  
present form as a federal mutual savings bank or in its future form as a federal
mutual savings bank in the event of the amendment of its federal mutual charter
and bylaws to substantially conform with the current regulatory model federal
mutual savings bank charter and bylaws.

     Capital Stock:  The term "Capital Stock" means any and all authorized
     -------------                                                        
shares of stock of the Converted Bank.

     Community Offering:  The term "Community Offering" means the offering of
     ------------------                                                      
shares of Conversion Stock to the general public by the Holding Company
concurrently with or after commencement of the Subscription Offering, giving
preference to natural persons and trusts of natural persons (including
individual retirement and Keogh retirement accounts and personal trusts in which
such natural persons have substantial interests) who are permanent Residents of
the Bank's Local Community.

     Conversion:  The term "Conversion" means (i) the amendment of the Bank's
     ----------                                                              
federal mutual charter and bylaws to authorize issuance of shares of Capital
Stock by the Converted Bank and to conform to the requirements of a federal
capital stock savings bank under the laws of the United States and applicable
regulations; (ii) the issuance and sale of Conversion Stock by the Holding
Company in the Subscription and Community Offerings and/or in an underwritten
public offering or otherwise; and (iii) the purchase by the Holding Company of
all the Capital Stock of the Converted Bank to be issued in the Conversion
immediately following or concurrently with the close of the sale of the
Conversion Stock.

     Conversion Stock:  The term "Conversion Stock" means the shares of common
     ----------------                                                         
stock to be issued and sold by the Holding Company pursuant to the Plan.

     Converted Bank:  The term "Converted Bank" means Northfield Federal Savings
     --------------                                                             
in its form as a federal capital stock savings bank resulting from the
conversion of the Bank to the stock form of organization in accordance with the
terms of the Plan.

     Eligibility Record Date:  The term "Eligibility Record Date" means the
     -----------------------                                               
close of business on December 31, 1995.

     Eligible Account Holder:  The term "Eligible Account Holder" means each
     -----------------------                                                
holder of one or more Qualifying Deposits in the Bank on the Eligibility Record
Date.

     Holding Company:  The term "Holding Company" means a corporation to be
     ---------------                                                       
incorporated by the Bank under state law for the purpose of becoming a holding
company for the Converted Bank through the issuance and sale of Conversion Stock
under the Plan and the concurrent acquisition of 100% of the Capital Stock to be
issued and sold pursuant to the Plan.

                                      A-2
<PAGE>
 
     Holding Company Stock:  The term "Holding Company Stock" means any and all
     ---------------------                                                     
authorized shares of stock of the Holding Company.

     Independent Appraiser:  The term "Independent Appraiser" means a person
     ---------------------                                                  
independent of the Bank, experienced and expert in the area of corporate
appraisal, and acceptable to the OTS, retained by the Bank to prepare an
appraisal of the pro forma market value of the Converted Bank, as a subsidiary
of the Holding Company.

     Local Community:  The term "Local Community" means the county or counties
     ---------------                                                          
in which the Bank's office or offices are located.

     Market Maker:  The term "Market Maker" means a dealer (i.e., any person who
     ------------                                                               
engages, either for all or part of such person's time, directly or indirectly,
as agent, broker or principal in the business of offering, buying, selling or
otherwise dealing or trading in securities issued by another person) who, with
respect to a particular security, (i)(a) regularly publishes bona fide,
competitive bid and offer quotations in a recognized interdealer quotation
system or (b) furnishes bona fide competitive bid and offer quotations on
request and (ii) is ready, willing and able to effect transactions in reasonable
quantities at its quoted prices with other brokers or dealers.

     Member:  The term "Member" means any person or entity who qualifies as a
     ------                                                                  
member of the Bank under its federal mutual charter and bylaws prior to the
Conversion.

     Officer: The term "Officer" means an executive officer of the Holding
     -------
Company or the Bank (as applicable), including the Chairman of the Board,
President, Executive Vice Presidents, Senior Vice Presidents in charge of
principal business functions, Secretary and Treasurer.

     Order Form:  The term "Order Form" means the order form or forms to be used
     ----------                                                                 
by Eligible Account Holders, Supplemental Eligible Account Holders and other
persons eligible to purchase Conversion Stock pursuant to the Plan.

     Other Member:  The term "Other Member" means any person, other than an
     ------------                                                          
Eligible Account Holder or a Supplemental Eligible Account Holder, who is a
Member as of the Voting Record Date.

     OTS:  The term "OTS" means the Office of Thrift Supervision of the United
     ---                                                                      
States Department of the Treasury or any successor agency having jurisdiction
over the Conversion.

     Plan:  The term "Plan" means this Plan of Conversion under which the Bank
     ----                                                                     
will convert from a federal mutual savings Bank to a federal capital stock
savings Bank as a wholly owned subsidiary of the Holding Company, as originally
adopted by the Board of Directors or amended in accordance with the terms
hereof.

     Qualifying Deposit:  The term "Qualifying Deposit" means each savings
     ------------------                                                   
balance in any Savings Account in the Bank as of the close of business on the
Eligibility Record Date or the Supplemental Eligibility Record Date, as
applicable, which is equal to or greater than $50.00.

     Registration Statement:  The term "Registration Statement" means the
     ----------------------                                              
Registration Statement on Form SB-2, or such other form as may be appropriate,
and any amendments thereto, filed by the Holding Company with the SEC pursuant
to the Securities Act of 1933, as amended, to register shares of Conversion
Stock.

     Resident:  The term "Resident," as used in this Plan in relation to the
     --------                                                               
preference afforded natural persons and trusts of natural persons in the Local
Community, includes any natural person who occupies a dwelling within the Local
Community, has an intention to remain within the Local Community for a period of
time (manifested by establishing a physical, ongoing, non-transitory presence
within the Local Community) and continues to reside therein at the time of the
Community Offering.  The Bank may utilize deposit or loan records or such other
evidence provided to it to make the determination as to whether a person is
residing in the Local Community.  To the extent the "person" is a corporation 

                                      A-3
<PAGE>
 
or other business entity, the principal place of business or headquarters should
be within the Local Community. To the extent the "person" is a personal benefit
plan, the circumstances of the beneficiary shall apply with respect to this
definition. In the case of all other benefit plans, circumstances of the trustee
shall be examined for purposes of this definition. In all cases, such
determination shall be in the sole discretion of the Bank.

     Sale:  The terms "sale" and "sell" mean every contract to sell or otherwise
     ----                                                                       
dispose of a security or an interest in a security for value, but such terms do
not include an exchange of securities in connection with a merger or acquisition
approved by the OTS or any other federal agency having jurisdiction.

     Savings Account:  The term "Savings Account" means a withdrawable deposit
     ---------------                                                          
in the Bank.

     SEC:  The term "SEC" means the Securities and Exchange Commission or any
     ---                                                                     
successor agency.

     Special Meeting:  The term "Special Meeting" means the Special Meeting of
     ---------------                                                          
Members to be called for the purpose of submitting the Plan to the Members for
their approval.

     Subscription Offering:  The term "Subscription Offering" means the offering
     ---------------------                                                      
of shares of Conversion Stock to Eligible Account Holders, Tax-Qualified
Employee Stock Benefit Plans, Supplemental Eligible Account Holders and Other
Members under the Plan.

     Subscription and Community Prospectus:  The term "Subscription and
     -------------------------------------                             
Community Prospectus" means the final prospectus to be used in connection with
the Subscription and Community Offerings.

     Subscription Rights:  The term "Subscription Rights" means non-
     -------------------                                           
transferable, non-negotiable, personal rights of Eligible Account Holders, Tax-
Qualified Employee Stock Benefit Plans, Supplemental Eligible Account Holders
and Other Members to purchase Conversion Stock offered under the Plan.

     Supplemental Eligibility Record Date:  The term "Supplemental Eligibility
     ------------------------------------                                     
Record Date" means the last day of the calendar quarter preceding the approval
of the Plan by the OTS.

     Supplemental Eligible Account Holder:  The term "Supplemental Eligible
     ------------------------------------                                  
Account Holder" means each holder of one or more Qualifying Deposits in the Bank
(other than Officers and directors of the Bank and their Associates) on the
Supplemental Eligibility Record Date.

     Tax-Qualified Employee Stock Benefit Plan:  The term "Tax-Qualified
     -----------------------------------------                          
Employee Stock Benefit Plan" means any defined benefit plan or defined
contribution plan of the Bank or the Holding Company, such as an employee stock
ownership plan, stock bonus plan, profit sharing plan or other plan, which, with
its related trust, meets the requirements to be "qualified" under section 401 of
the Internal Revenue Code of 1986, as amended.  "Non-Tax-Qualified Employee
Stock Benefit Plan" means any defined benefit plan or defined contribution plan
which is not so qualified.

     Voting Record Date:  The term "Voting Record Date" means the date fixed by
     ------------------                                                        
the Board of Directors of the Bank to determine Members of the Bank entitled to
vote at the Special Meeting.

III.  Steps Prior to Submission of the Plan to the Members for Approval.

     Prior to submission of the Plan to its Members for approval, the Bank must
receive approval from the OTS of an Application for Approval of Conversion on
Form AC, which includes the Plan to convert to the stock form of organization
(the "Application").  The following steps must be taken prior to such regulatory
approval:

          A.  The Board of Directors shall adopt the Plan by not less than a
     two-thirds vote.

                                      A-4
<PAGE>
 
          B.  Promptly after adoption of the Plan by the Board of Directors, the
     Bank shall notify its Members of the adoption of the Plan by publishing a
     statement in a newspaper having a general circulation in each community in
     which the Bank maintains an office and/or by mailing a letter to each of
     its Members.

          C.  A press release relating to the proposed Conversion may be
     submitted to the local media.

          D.  Copies of the Plan adopted by the Board of Directors shall be made
     available for inspection by Members at each office of the Bank.

          E.  The Bank shall cause the Holding Company to be incorporated under
     state law, and the Board of Directors of the Holding Company shall concur
     in the Plan by at least a two-thirds vote.

          F.  The Bank shall submit or cause to be submitted the Application to
     the OTS.  The Holding Company shall submit or cause to be submitted an
     Application H-(e)1 or Application H-(e)1-S to the OTS and the Registration
     Statement to the SEC.  Upon receipt of advice from the regulatory
     authorities that the Application has been received and is in the prescribed
     form, the Bank shall publish a "Notice of Filing of an Application for
     Conversion to a Stock Savings Bank" in a newspaper of general circulation,
     as referred to in Paragraph III.B. herein.  The Bank also shall prominently
     display a copy of such notice in each of its offices.  The Holding Company
     shall publish notice of the filing of the Application H-(e)1 or H-(e)1-S in
     accordance with applicable regulations.

          G.  The Bank shall obtain an opinion of its tax advisors or a
     favorable ruling from the United States Internal Revenue Service which
     shall state that the Conversion will not result in a taxable reorganization
     for federal income tax purposes to the Bank.  Receipt of a favorable
     opinion or ruling is a condition precedent to completion of the Conversion.

          H.  The Plan shall be submitted to a vote of the Members at the
     Special Meeting after approval by the OTS.

IV.  Meeting of Members.

     Following receipt of approval of the Plan by the OTS, the Special Meeting
to vote on the Plan shall be scheduled in accordance with the Bank's bylaws and
applicable regulations.  Notice of the Special Meeting will be given by means of
a proxy statement authorized for use by the OTS.  Promptly after receipt of
approval and at least 20 days but not more than 45 days prior to the Special
Meeting, the Bank will distribute proxy solicitation materials to all voting
Members as of the Voting Record Date established for voting at the Special
Meeting.  Proxy materials will also be sent to each beneficial holder of an
Individual Retirement Account where the name of the beneficial holder is
disclosed on the Bank's records.  The proxy solicitation materials will include
a copy of the Proxy Statement and other documents authorized for use by the
regulatory authorities and may also include a Subscription and Community
Prospectus as provided in Paragraph VI. below.  The Bank will also advise each
Eligible Account Holder and Supplemental Eligible Account Holder not entitled to
vote at the Special Meeting of the proposed Conversion and the scheduled Special
Meeting and provide a postage paid card on which to indicate whether he or she
wishes to receive the Subscription and Community Prospectus, if the Subscription
and Community Offerings are not held concurrently with the proxy solicitation.

     Pursuant to applicable regulations, an affirmative vote of at least a
majority of the total outstanding votes of the Members will be required for
approval of the Plan.  Voting may be in person or by proxy.  The OTS shall be
promptly notified of the actions of the Members at the Special Meeting.

                                      A-5
<PAGE>
 
V.  Summary Proxy Statement.

     The Proxy Statement to be furnished to Members may be in summary form,
provided that a statement is made in boldface type that a more detailed
description of the proposed transaction may be obtained by returning an enclosed
postage paid card or other written communication requesting a supplemental
information statement.  Without prior approval from the OTS, the Special Meeting
shall not be held fewer than 20 days after the last day on which the
supplemental information statement is mailed to Members requesting the same.
The supplemental information statement may be combined with the Subscription and
Community Prospectus if the Subscription and Community Offerings are commenced
concurrently with the proxy solicitation of Members for the Special Meeting.

VI.  Offering Documents.

     The Holding Company may commence the Subscription Offering and, provided
that the Subscription Offering has commenced, may commence the Community
Offering concurrently with or during the proxy solicitation of Members and may
close the Subscription and Community Offerings before the Special Meeting,
provided that the offer and sale of the Conversion Stock shall be conditioned
upon approval of the Plan by the Members at the Special Meeting.

     The Bank's proxy solicitation materials may require Eligible Account
Holders, Supplemental Eligible Account Holders and Other Members to return to
the Bank by a reasonable date certain a postage-paid written communication
requesting receipt of a Subscription and Community Prospectus in order to be
entitled to receive a Subscription and Community Prospectus, provided that the
Subscription Offering shall not be closed until the expiration of 30 days after
mailing proxy solicitation materials to voting Members and a postage-paid
written communication to non-voting Eligible Account Holders and Supplemental
Eligible Account Holders.  If the Subscription Offering is commenced within 45
days after the Special Meeting, the Bank shall transmit, no more than 30 days
prior to the commencement of the Subscription Offering, to each voting Member
who had been furnished with proxy solicitation materials and to each non-voting
Eligible Account Holder and Supplemental Eligible Account Holder, written notice
of the commencement of the Subscription Offering which shall state that the Bank
is not required to furnish a Subscription and Community Prospectus to them
unless they return by a reasonable date certain a postage-paid written
communication requesting the receipt of the Subscription and Community
Prospectus.

     Prior to commencement of the Subscription and Community Offerings, the
Holding Company shall file the Registration Statement with the SEC pursuant to
the Securities Act of 1933, as amended.  The Holding Company shall not
distribute the Subscription and Community Prospectus until the Registration
Statement containing the same has been declared effective by the SEC and the
aforementioned documents have been approved by the OTS.  The Subscription and
Community Prospectus may be combined with the Proxy Statement for the Special
Meeting.

VII.  Consummation of Conversion.

     The date of consummation of the Conversion will be the effective date of
the amendment of the Bank's federal mutual charter to read in the form of a
federal stock charter, which shall be the date of the issuance and sale of the
Conversion Stock.  After receipt of all orders for Conversion Stock, and
concurrently with the execution thereof, the amendment of the Bank's federal
mutual charter to authorize the issuance of shares of Capital Stock and to
conform to the requirements of a federal capital stock savings Bank will be
declared effective by the OTS, and the amended bylaws approved by the Members
will become effective.  At such time, the Conversion Stock will be issued and
sold by the Holding Company, the Capital Stock to be issued in the Conversion
will be issued and sold to the Holding Company, and the Converted Bank will
become a wholly owned subsidiary of the Holding Company.  The Converted Bank
will issue to the Holding Company 100,000 shares of its common stock,
representing all of the shares of Capital Stock to be issued by the Converted
Bank in the Conversion, and the Holding Company will make payment to the
Converted Bank of at least 50 percent of the aggregate net proceeds realized by
the Holding Company from the sale of the Conversion Stock under the Plan, or
such other portion of the aggregate net proceeds as may be authorized or
required by the OTS.

                                      A-6
<PAGE>
 
VIII.  Stock Offering.

     A.   General.
          ------- 

          The aggregate purchase price of all shares of Conversion Stock which
     will be offered and sold will be equal to the estimated pro forma market
     value of the Converted Bank, as a subsidiary of the Holding Company, as
     determined by an independent appraisal.  The exact number of shares of
     Conversion Stock to be offered will be determined by the Board of Directors
     of the Bank and the Board of Directors of the Holding Company, or their
     respective designees, in conjunction with the determination of the Purchase
     Price (as that term is defined in Paragraph VIII.B. below).  The number of
     shares to be offered may be subsequently adjusted prior to completion of
     the Conversion as provided below.

     B.   Independent Evaluation and Purchase Price of Shares.
          --------------------------------------------------- 

          All shares of Conversion Stock sold in the Conversion will be sold at
     a uniform price per share referred to in this Plan as the "Purchase Price."
     The Purchase Price and the total number of shares of Conversion Stock to be
     offered in the Conversion will be determined by the Board of Directors of
     the Bank and the Board of Directors of the Holding Company, or their
     respective designees, immediately prior to the simultaneous completion of
     all such sales contemplated by this Plan on the basis of the estimated pro
     forma market value of the Converted Bank, as a subsidiary of the Holding
     Company, at such time.  The estimated pro forma market value of the
     Converted Bank, as a subsidiary of the Holding Company, will be determined
     for such purpose by an Independent Appraiser on the basis of such
     appropriate factors as are not inconsistent with applicable regulations.
     Immediately prior to the Subscription and Community Offerings, a
     subscription price range of shares for the offerings will be established
     (the "Valuation Range"), which will vary from 15% above to 15% below the
     midpoint of such range.  The number of shares of Conversion Stock
     ultimately issued and sold will be determined at the close of the
     Subscription and Community Offerings and any other offering.  The
     subscription price range and the number of shares to be offered may be
     changed subsequent to the Subscription and Community Offerings as the
     result of any appraisal updates prior to the completion of the Conversion,
     without notifying eligible purchasers in the Subscription and Community
     Offerings and without a resolicitation of subscriptions, provided the
     aggregate Purchase Price is not below the low end or more than 15 percent
     above the high end of the Valuation Range previously approved by the OTS or
     if, in the opinion of the Boards of Directors of the Bank and the Holding
     Company, the new Valuation Range established by the appraisal update does
     not result in a materially different capital position of the Converted
     Bank.

          Notwithstanding the foregoing, no sale of Conversion Stock may be
     consummated unless, prior to such consummation, the Independent Appraiser
     confirms to the Bank and the Holding Company and to the OTS that, to the
     best knowledge of the Independent Appraiser, nothing of a material nature
     has occurred which, taking into account all relevant factors, would cause
     the Independent Appraiser to conclude that the aggregate value of the
     Conversion Stock at the Purchase Price is incompatible with its estimate of
     the aggregate consolidated pro forma market value of the Converted Bank, as
     a subsidiary of the Holding Company.  If such confirmation is not received,
     the Bank may cancel the Subscription and Community Offerings and/or any
     other offering, extend the Conversion, establish a new Valuation Range,
     extend, reopen or hold new Subscription and Community Offerings and/or
     other offerings or take such other action as the OTS may permit.

     C.   Subscription Offering.
          --------------------- 

          Non-transferable Subscription Rights to purchase shares of Conversion
     Stock will be issued at no cost to Eligible Account Holders, Tax-Qualified
     Employee Stock Benefits Plans, Supplemental Eligible Account Holders and
     Other Members pursuant to priorities established by applicable regulations.
     All shares must be sold, and, to the extent that Conversion Stock is
     available, no subscriber will be allowed to purchase fewer than 

                                      A-7
<PAGE>

         25 shares of Conversion Stock, provided that this number shall be
         decreased if the aggregate purchase price exceeds $500. The priorities
         established by applicable regulations for the purchase of shares are as
         follows:

         1.       Category No. 1:  Eligible Account Holders.

                           a. Each Eligible Account Holder shall receive,
                  without payment, non-transferable Subscription Rights to
                  purchase Conversion Stock in an amount equal to the greater of
                  $125,000, one-tenth of one percent of the total offering of
                  shares of Conversion Stock or 15 times the product (rounded
                  down to the next whole number) obtained by multiplying the
                  total number of shares of Conversion Stock to be issued by a
                  fraction of which the numerator is the amount of the
                  Qualifying Deposit of the Eligible Account Holder and the
                  denominator is the total amount of Qualifying Deposits of all
                  Eligible Account Holders in the Converted Bank in each case on
                  the Eligibility Record Date.

                           b. Non-transferable Subscription Rights to purchase
                  Conversion Stock received by Officers and directors of the
                  Bank and their Associates based on their increased deposits in
                  the Bank in the one year period preceding the Eligibility
                  Record Date shall be subordinated to all other subscriptions
                  involving the exercise of non-transferable Subscription Rights
                  to purchase shares pursuant to this Subscription Category.

                           c. In the event of an oversubscription for shares of
                  Conversion Stock pursuant to this Category, shares of
                  Conversion Stock shall be allocated among subscribing Eligible
                  Account Holders as follows:

                                    (I)  Shares of Conversion Stock shall be
                           allocated among subscribing Eligible Account Holders
                           so as to permit each such Account Holder, to the
                           extent possible, to purchase a number of shares of
                           Conversion Stock sufficient to make its total
                           allocation equal to 100 shares or the total amount
                           of its subscription, whichever is less.

                                    (II) Any shares not so allocated shall be
                           allocated among the subscribing Eligible Account
                           Holders on an equitable basis, related to the amounts
                           of their respective aggregate Qualifying Deposits, as
                           compared to the total aggregate Qualifying Deposits
                           of all subscribing Eligible Account Holders.

         2.       Category No. 2:  Tax-Qualified Employee Stock Benefit Plans.

                           a. Tax-Qualified Employee Stock Benefit Plans of the
                  Converted Bank shall receive, without payment,
                  non-transferable Subscription Rights to purchase up to 10% of
                  the shares of Conversion Stock issued in the Conversion.

                           b. Subscription rights received in this Category
                  shall be subordinated to the Subscription Rights received by
                  Eligible Account Holders pursuant to Category No. 1, provided
                  that any shares of Conversion Stock sold in excess of the high
                  end of the Valuation Range may be first sold to Tax-Qualified
                  Employee Stock Benefit Plans.

         3.       Category No. 3:  Supplemental Eligible Account Holders.

                           a. In the event that the Eligibility Record Date is
                  more than 15 months prior to the date of the latest amendment
                  of the Application filed prior to OTS approval, then each
                  Supplemental Eligible Account Holder shall receive, without
                  payment, non-transferable Subscription Rights to purchase
                  Conversion Stock in an amount equal to the greater of
                  $125,000, one-tenth of one percent of the total 

                                      A-8

<PAGE>
 
          offering of shares of Conversion Stock or 15 times the product
          (rounded down to the next whole number) obtained by multiplying the
          total number of the shares of Conversion Stock to be issued by a
          fraction of which the numerator is the amount of the Qualifying
          Deposit of the Supplemental Eligible Account Holder and the
          denominator is the total amount of the Qualifying Deposits of all
          Supplemental Eligible Account Holders on the Supplemental Eligibility
          Record Date.

               b.  Subscription Rights received pursuant to this Category shall
          be subordinated to the Subscription Rights received by the Eligible
          Account Holders and by Tax-Qualified Employee Stock Benefit Plans
          pursuant to Category Nos. 1 and 2.

               c.  Any non-transferable Subscription Rights to purchase shares
          received by an Eligible Account Holder in accordance with Category No.
          1 shall reduce to the extent thereof the Subscription Rights to be
          distributed to such Eligible Account Holder pursuant to this Category.

               d.  In the event of an oversubscription for shares of Conversion
          Stock pursuant to this Category, shares of Conversion Stock shall be
          allocated among the subscribing Supplemental Eligible Account Holders
          as follows:

                    (I)   Shares of Conversion Stock shall be allocated among
               subscribing Supplemental Eligible Account Holders so as to permit
               each such Supplemental Eligible Account Holder, to the extent
               possible, to purchase a number of shares of Conversion Stock
               sufficient to make its total allocation (including the number of
               shares of Conversion Stock, if any, allocated in accordance with
               Category No. 1) equal to 100 shares of Conversion Stock or the
               total amount of its subscription, whichever is less.

                    (II)  Any shares of Conversion Stock not allocated in
               accordance with subparagraph (I) above shall be allocated among
               the subscribing Supplemental Eligible Account Holders on an
               equitable basis, related to the amounts of their respective
               aggregate Qualifying Deposits on the Supplemental Eligibility
               Record Date as compared to the total aggregate Qualifying
               Deposits of all subscribing Supplemental Eligible Account Holders
               in each case on the Supplemental Eligibility Record Date.

     4.   Category No. 4:  Other Members.

               a.  Each Other Member, other than those Members who are Eligible
          Account Holders or Supplemental Eligible Account Holders, shall
          receive, without payment, non-transferable Subscription Rights to
          purchase Conversion Stock in an amount equal to the greater of
          $125,000 or one-tenth of one percent of the total offering of shares
          of Conversion Stock.

               b.  Subscription Rights received pursuant to this Category shall
          be subordinated to the Subscription Rights received by Eligible
          Account Holders, Tax-Qualified Employee Stock Benefit Plans and
          Supplemental Eligible Account Holders pursuant to Category Nos. 1, 2
          and 3.

               c.  In the event of an oversubscription for shares of Conversion
          Stock pursuant to this Category, the shares of Conversion Stock
          available shall be allocated among subscribing Other Members so as to
          permit each subscribing Other Member, to the extent possible, to
          purchase a number of shares sufficient to make his or her total
          allocation of Conversion Stock equal to the lesser of 100 shares or
          the number of shares subscribed for by the Other Member.  The shares
          remaining thereafter will be allocated among subscribing Other Members
          whose subscriptions remain unsatisfied on a reasonable basis as
          determined by the Board of Directors.


                                      A-9
<PAGE>
 
               Order Forms may provide that the maximum purchase limitation
          shall be based on the midpoint of the Valuation Range.  In the event
          the aggregate Purchase Price of the Conversion Stock issued and sold
          is below the midpoint of the Valuation Range, that portion of
          subscriptions in excess of the maximum purchase limitation will be
          refunded.  In the event the aggregate Purchase Price of Conversion
          Stock issued and sold is above the midpoint of the Valuation Range,
          persons who have subscribed for the maximum purchase limitation may be
          given the opportunity to increase their subscriptions so as to
          purchase the maximum number of shares subject to the availability of
          shares.  The Bank will not otherwise notify subscribers of any change
          in the number of shares of Conversion Stock offered.

     D.   Community Offering.
          ------------------ 

               1.  Any shares of Conversion Stock not purchased through the
          exercise of Subscription Rights in the Subscription Offering may be
          sold in a Community Offering, which may commence concurrently with the
          Subscription Offering.  Shares of Conversion Stock will be offered in
          the Community Offering to the general public, giving preference to
          natural persons and the trusts of natural persons (including
          individual retirement and Keogh retirement accounts and personal
          trusts in which such natural persons have substantial interests) who
          are permanent Residents of the Local Community.  The Community
          Offering may commence concurrently with or as soon as practicable
          after the completion of the Subscription Offering and must be
          completed within 45 days after the last day of the Subscription
          Offering, unless extended by the Holding Company with the approval of
          the OTS.  The offering price of the Conversion Stock to the general
          public in the Community Offering will be the same price paid for such
          stock by Eligible Account Holders and other persons in the
          Subscription Offering.  If sufficient shares are not available to
          satisfy all orders in the Community Offering, the shares available
          will be allocated by the Holding Company in its discretion.  The
          Holding Company shall have the right to accept or reject orders in the
          Community Offering in whole or in part.

               2.  Orders accepted in the Community Offering shall be filled up
          to a maximum of 2% of the Conversion Stock, and thereafter remaining
          shares shall be allocated on an equal number of shares basis per order
          until all orders have been filled.

               3.  The Conversion Stock to be offered in the Community Offering
          will be offered and sold in a manner that will achieve the widest
          distribution of the Conversion Stock.

     E.   Other Offering.
          -------------- 

               In the event a Community Offering does not appear feasible, the
          Bank will immediately consult with the OTS to determine the most
          viable alternative available to effect the completion of the
          Conversion.  Should no viable alternative exist, the Bank may
          terminate the Conversion with the concurrence of the OTS.

     F.   Limitations Upon Purchases of Shares of Conversion Stock.
          -------------------------------------------------------- 

          The following additional limitations and exceptions shall apply to all
          purchases of Conversion Stock:

               1.  No Person may purchase fewer than 25 shares of Conversion
          Stock in the Conversion, to the extent such shares are available.


                                     A-10
<PAGE>
 
               2.  Purchases of Conversion Stock in the Community Offering by
          any person, when aggregated with purchases by an Associate of that
          person, or a group of persons Acting in Concert, shall not exceed
          $125,000 of Conversion Stock, except that Tax-Qualified Employee
          Stock Benefit Plans may purchase up to 10% of the total shares of
          Conversion Stock to be issued in the Conversion, and shares to be held
          by the Tax-Qualified Employee Stock Benefit Plans and attributable to
          a participant thereunder shall not be aggregated with shares of
          Conversion Stock purchased by such participant or any other purchaser
          of Conversion Stock in the Conversion.

               3.  Officers and directors of the Bank and the Holding Company,
          and Associates thereof, may not purchase in the aggregate more than
          35% of the shares of Conversion Stock issued in the Conversion, or
          such greater amount as may be permitted under applicable legal limits.

               4.  Directors of the Holding Company and the Bank shall not be
          deemed to be Associates or a group Acting in Concert with other
          directors solely as a result of membership on the Board of Directors
          of the Holding Company or the Bank or any of their subsidiaries.

               5.  Purchases of shares of Conversion Stock in the Conversion by
          any person, when aggregated with purchases by an Associate of that
          person, or a group of persons Acting in Concert, shall not exceed the
          lesser of (a) $225,000 of Conversion Stock or (b) 5% of the shares
          of Conversion Stock issued in the Conversion, except that Tax-
          Qualified Employee Stock Benefit Plans may purchase up to 10% of the
          total shares of Conversion Stock to be issued in the Conversion, and
          shares purchased by the Tax-Qualified Employee Stock Benefit Plans and
          attributable to a participant thereunder shall not be aggregated with
          shares purchased by such participant or any other purchaser of
          Conversion Stock in the Conversion.

          Subject to any required regulatory approval and the requirements of
     applicable laws and regulations, the Holding Company and the Bank may
     increase or decrease any of the purchase limitations set forth herein at
     any time.  Under current regulatory authority, the Boards of Directors of
     the Holding Company and the Bank may, in their discretion, increase the
     maximum purchase limitations in the Subscription Offering and/or, if
     applicable, the Community Offering or other offering up to 9.99%, provided
     that orders for shares exceeding 5% of the shares to be issued in the
     Conversion shall not exceed, in the aggregate, 10% of the shares to be
     issued in the Conversion.  In the event that the individual purchase
     limitation is increased after commencement of the Subscription and
     Community Offerings, the Holding Company and the Bank shall permit any
     person who subscribed for the maximum number of shares of Conversion Stock
     to purchase an additional number of shares, such that such person shall be
     permitted to subscribe for the then maximum number of shares permitted to
     be subscribed for by such person, subject to the rights and preferences of
     any person who has priority Subscription Rights.  In the event that either
     the individual purchase limitation or the number of shares of Conversion
     Stock to be sold in the Conversion is decreased after commencement of the
     Subscription and Community Offerings, the orders of any person who
     subscribed for the maximum number of shares of Conversion Stock shall be
     decreased by the minimum amount necessary so that such person shall be in
     compliance with the then maximum number of shares permitted to be
     subscribed for by such person.

          Each person purchasing Conversion Stock in the Conversion shall be
     deemed to confirm that such purchase does not conflict with the purchase
     limitations under the Plan or otherwise imposed by law, rule or regulation.
     In the event that such purchase limitations are violated by any person
     (including any Associate or group of persons affiliated or otherwise Acting
     in Concert with such person), the Holding Company shall have the right to
     purchase from such person at the actual Purchase Price per share all shares
     acquired by such person in excess of such purchase limitations or, if such
     excess shares have been sold by such person, to receive the difference
     between the actual Purchase Price per share paid for such excess shares and
     the price at which such excess shares were sold by such person.  This right
     of the Holding Company to purchase such excess shares shall be assignable
     by the Holding Company.


                                     A-11
<PAGE>
 
     G.   Restrictions on and Other Characteristics of Stock Being Sold.
          ------------------------------------------------------------- 

          1.   Transferability.
               --------------- 

               Except as provided in Paragraph XIII. below, Conversion Stock
          purchased by persons other than directors and Officers of the Bank and
          directors and Officers of the Holding Company will be transferable
          without restriction.  Conversion Stock purchased by such directors or
          Officers shall not be sold for a period of one year from the date of
          Conversion except for any sale of such shares (i) following the death
          of the original purchaser or (ii) resulting from an exchange of
          securities in a merger or acquisition approved by the applicable
          regulatory authorities.

               The Conversion Stock issued by the Holding Company to such
          directors and Officers shall bear the following legend giving
          appropriate notice of the one-year holding period restriction:

               "The shares of stock evidenced by this Certificate are restricted
               as to transfer for a period of one year from the date of this
               Certificate pursuant to applicable regulations of the Office of
               Thrift Supervision of the United States Department of the
               Treasury.  Except in the event of the death of the registered
               holder, the shares represented by this Certificate may not be
               sold prior thereto without a legal opinion of counsel for the
               Holding Company that said sale is permissible under the
               provisions of applicable laws and regulations."

               In addition, the Holding Company shall give appropriate
          instructions to the transfer agent for the Holding Company Stock with
          respect to the applicable restrictions relating to the transfer of
          restricted stock.  Any shares of Holding Company Stock subsequently
          issued as a stock dividend, stock split or otherwise, with respect to
          any such restricted stock, shall be subject to the same holding period
          restrictions for such directors and Officers as may be then applicable
          to such restricted stock.

          2.   Repurchase and Dividend Rights.
               ------------------------------ 

               Pursuant to present regulations, except as otherwise permitted by
          the OTS, the Holding Company may not, for a period of three years from
          the date of Conversion, repurchase Holding Company Stock from any
          person, with the exception of (i) repurchases on a pro rata basis
          pursuant to offers approved by the OTS and made to all stockholders,
          (ii) repurchases of qualifying shares of directors or, (iii) unless
          prohibited by the OTS, repurchases of shares to fund employee stock
          benefit plans of the Holding Company or the Bank.  Upon 10 days'
          written notification to the OTS Regional Director for the Converted
          Bank and the Chief Counsel of the Corporate and Securities Division of
          the OTS, however, the Holding Company may make open market repurchases
          of outstanding Holding Company Stock, provided that (i) such Regional
          Director and Chief Counsel do not object based on a determination that
          (a) the repurchases would materially adversely affect the financial
          condition of the Converted Bank, (b) the information submitted by the
          Converted Bank is insufficient upon which to base a conclusion as to
          whether the Converted Bank's financial condition would be materially
          adversely affected, or (c) the Converted Bank does not demonstrate a
          valid purpose for the repurchases.  Except as otherwise permitted by
          the OTS, (i) no repurchases may occur in the first year following the
          Conversion; (ii) any repurchases in the second and third years
          following the Conversion must be part of an open-market stock
          repurchase program that allows no more than five percent (5%) of the
          outstanding Holding Company Stock to be purchased during any 12 month
          period; and (iii) any repurchases within the first three years
          following the Conversion must not cause the Converted Bank to become
          "undercapitalized," as defined pursuant to 12 C.F.R. (S)565.4 or a
          successor regulation.


                                     A-12
<PAGE>
 
               Present regulations also provide that the Converted Bank may not
          declare or pay a cash dividend on or repurchase any of its Capital
          Stock if the result thereof would be to reduce the regulatory capital
          of the Converted Bank below the amount required for the Liquidation
          Account.  Further, any dividend declared or paid on, or repurchase of,
          the Capital Stock shall be in compliance with the Rules and
          Regulations of the OTS, or other applicable regulations.

               The above limitations shall not preclude payment of dividends on,
          or repurchases of, Holding Company Stock in the event applicable
          federal regulatory limitations are liberalized subsequent to the
          Conversion.

          3.   Voting Rights.
               ------------- 

               After Conversion, holders of Savings Accounts and obligors on
          loans will not have voting rights in the Converted Bank.  Exclusive
          voting rights with respect to the Holding Company shall be vested in
          the holders of Holding Company Stock, and the Holding Company will
          have exclusive voting rights with respect to the Capital Stock.  Each
          stockholder of the Holding Company will be entitled to vote on any
          matters coming before the stockholders of the Holding Company for
          consideration and will be entitled to one vote for each share of stock
          owned by said stockholder.

          4.   Purchases by Officers, Directors and Associates Following
               ---------------------------------------------------------
               Conversion.
               ---------- 

               Without the prior approval of the OTS, Officers and directors of
          the Converted Bank and Officers and directors of the Holding Company,
          and their Associates, shall be prohibited for a period of three years
          following completion of the Conversion from purchasing outstanding
          shares of Holding Company Stock, except from a broker or dealer
          registered with the SEC.  Notwithstanding this restriction, negotiated
          transactions involving more than 1% of the total outstanding shares of
          Holding Company Stock and purchases made and shares held by a Tax-
          Qualified Employee Stock Benefit Plan or Non-Tax-Qualified Employee
          Stock Benefit Plan which may be attributable to Officers or directors
          may be made without OTS permission or the use of a broker or dealer.

     H.   Mailing of Offering Materials and Collation of Subscriptions.
          ------------------------------------------------------------ 

          The sale of all shares of Conversion Stock offered pursuant to the
     Plan must be completed within 24 months after approval of the Plan at the
     Special Meeting.  After approval of the Plan by the OTS and the declaration
     of the effectiveness of the Subscription and Community Prospectus by the
     SEC, the Holding Company shall distribute such Subscription and Community
     Prospectus and Order Forms for the purchase of shares in accordance with
     the terms of the Plan.

          The recipient of an Order Form will be provided neither fewer than 20
     days nor more than 45 days from the date of mailing, unless extended, to
     complete, execute and return properly the Order Form to the Holding Company
     or the Bank.  Self-addressed, postage paid return envelopes will accompany
     these forms when mailed.  The Bank or Holding Company will collate the
     returned executed Order Forms upon completion of the Subscription Offering.
     Failure of any eligible subscriber to return a properly completed and
     executed Order Form within the prescribed time limits shall be deemed a
     waiver and a release by such person of any rights to purchase shares of
     Conversion Stock hereunder.

          The sale of all shares of Conversion Stock shall be completed within
     45 days after the last day of the Subscription Offering unless extended by
     the Holding Company and the Bank with the approval of the OTS.


                                     A-13
<PAGE>
 
     I.   Method of Payment.
          ----------------- 

          Payment for all shares of Conversion Stock subscribed for in the
     Subscription and Community Offerings must be received in full by the Bank
     or the Holding Company, together with properly completed and executed Order
     Forms, indicating thereon the number of shares being subscribed for and
     such other information as may be required thereon, on or prior to the
     expiration date specified on the Order Form, unless such date is extended
     by the Holding Company and the Bank; provided, however, that payments by
     Tax-Qualified Employee Stock Benefit Plans for Conversion Stock may be made
     to the Bank concurrently with the completion of the Conversion.

          Payment for all shares of Conversion Stock may be made in cash (if
     delivered in person) or by check or money order, or, if the subscriber has
     a Savings Account in the Bank (including a certificate of deposit), the
     subscriber may authorize the Bank to charge the subscriber's Savings
     Account for the purchase amount.  The Bank shall pay interest at not less
     than the passbook rate on all amounts paid in cash or by check or money
     order to purchase shares of Conversion Stock in the Subscription and
     Community Offerings from the date payment is received until the Conversion
     is completed or terminated.  The Bank shall not knowingly loan funds or
     otherwise extend credit to any person for the purpose of purchasing
     Conversion Stock.

          If a subscriber authorizes the Bank to charge its Savings Account, the
     funds will remain in the subscriber's Savings Account and will continue to
     earn interest, but may not be used by the subscriber until all Conversion
     Stock has been sold or the Conversion is terminated, whichever is earlier.
     The withdrawal will be given effect only concurrently with the sale of all
     shares of Conversion Stock in the Conversion and only to the extent
     necessary to satisfy the subscription at a price equal to the Purchase
     Price.  The Bank will allow subscribers to purchase shares of Conversion
     Stock by withdrawing funds from certificate accounts without the assessment
     of early withdrawal penalties.  In the case of early withdrawal of only a
     portion of such account, the certificate evidencing such account shall be
     cancelled if the remaining balance of the account is less than the
     applicable minimum balance requirement.  In that event, the remaining
     balance will earn interest at the passbook rate.  This waiver of the early
     withdrawal penalty is applicable only to withdrawals made in connection
     with the purchase of Conversion Stock under the Plan.

          Tax-Qualified Employee Stock Benefit Plans may subscribe for shares by
     submitting an Order From, and in the case of an employee stock ownership
     plan, together with evidence of a loan commitment from the Holding Company
     or an unrelated financial institution for the purchase of the shares of
     Conversion Stock, during the Subscription Offering and by making payment
     for the shares of Conversion Stock on the date of the closing of the
     Conversion.

     J.   Undelivered, Defective or Late Order Forms; Insufficient Payment.
          ---------------------------------------------------------------- 

          In the event an Order Form (i) is not delivered and is returned to the
     Holding Company or the Bank by the United States Postal Service (or the
     Holding Company or the Bank is unable to locate the addressee); (ii) is not
     received by the Holding Company or the Bank, or is received by the Holding
     Company or the Bank after termination of the date specified thereon; (iii)
     is defectively completed or executed; or (iv) is not accompanied by the
     total required payment for the shares of Conversion Stock subscribed for
     (including cases in which the subscribers' Savings Accounts are
     insufficient to cover the authorized withdrawal for the required payment),
     the Subscription Rights of the person to whom such rights have been granted
     will not be honored and will be treated as though such person failed to
     return the completed Order Form within the time period specified therein.
     Alternatively, the Holding Company or the Bank may, but will not be
     required to, waive any irregularity relating to any Order Form or require
     the submission of a corrected Order Form or the remittance of full payment
     for subscribed shares of Conversion Stock by such date as the Holding
     Company or the Bank may specify.  Subscription orders, once tendered,
     cannot be revoked.  The Holding Company's and the Bank's 



                                     A-14
<PAGE>
 
     interpretation of the terms and conditions of this Plan and acceptability
     of the Order Forms will be final and conclusive.

     K.     Members in Non-Qualified States or in Foreign Countries.
            ------------------------------------------------------- 

            The Holding Company will make reasonable efforts to comply with the
      securities laws of all states in the United States in which persons
      entitled to subscribe for Conversion Stock pursuant to the Plan reside.
      However, no such person will be offered or receive any Conversion Stock
      under this Plan who resides in a foreign country or who resides in a state
      of the United States with respect to which any or all of the following
      apply: (i) a small number of persons otherwise eligible to subscribe for
      shares of Conversion Stock under this Plan reside in such state or foreign
      country; (ii) the granting of Subscription Rights or the offer or sale of
      shares of Conversion Stock to such person would require the Holding
      Company or the Bank or their employees to register, under the securities
      laws of such state, as a broker, dealer, salesman or agent or to register
      or otherwise qualify its securities for sale in such state or foreign
      country; and (iii) such registration qualification would be impracticable
      for reasons of cost or otherwise. No payments will be made in lieu of the
      granting of Subscription Rights to any such person.

      L.    Sales Commissions.
            ----------------- 

            Sales commissions may be paid as determined by the Boards of
       Directors of the Bank and the Holding Company or their designees to
       securities dealers assisting subscribers in making purchases of
       Conversion Stock in the Subscription Offering or in the Community
       Offering, if the securities dealer is named by the subscriber on the
       Order Form. In addition, a sales commission may be paid to a securities
       dealer for advising and consulting with respect to, or for managing the
       sale of Conversion Stock in, the Subscription Offering, the Community
       Offering or any other offering.

IX.    Charter and Bylaws.

       As part of the Conversion, a federal stock charter and bylaws will be
adopted to authorize the Converted Bank to operate as a federal capital stock
savings Bank.  By approving the Plan, the Members of the Bank will thereby
approve amending the Bank's existing federal mutual charter and bylaws to read
in the form of a federal stock charter and bylaws.  Prior to completion of the
Conversion, the proposed federal stock charter and bylaws may be amended in
accordance with the provisions and limitations for amending the Plan under
Paragraph XIV. below.  The effective date of the amendment of the Bank's federal
mutual charter and bylaws to read in the form of a federal stock charter and
bylaws shall be the date of the issuance of the Conversion Stock, which shall be
the date of consummation of the Conversion.

X.     Registration and Market Making.

       In connection and concurrently with the Conversion, the Holding Company
shall register the Holding Company Stock with the SEC pursuant to the Securities
Exchange Act of 1934, as amended, and shall undertake not to deregister the
Holding Company Stock for a period of three years thereafter.

       The Holding Company shall use its best efforts to encourage and assist
various Market Makers to establish and maintain a market for the Holding Company
Stock.  The Holding Company shall also use its best efforts to have the Holding
Company Stock quoted on the National Association of Securities Dealers, Inc.
Automated Quotation System or listed on a national or regional securities
exchange.

                                     A-15
<PAGE>
 
XI.    Status of Savings Accounts and Loans Subsequent to Conversion.

       All Savings Accounts in the Bank will retain the same status after
Conversion as these accounts had prior to Conversion.  Subject to Paragraph
VIII.I. hereof, each holder of a Savings Account in the Bank shall retain,
without payment, a withdrawable Savings Account or Savings Accounts in the
Converted Bank, equal in dollar amount and on the same terms and conditions as
in effect prior to Conversion.  All Savings Accounts will continue to be insured
by the Savings Association Insurance Fund of the Federal Deposit Insurance
Corporation up to the applicable limits of insurance coverage.  All loans shall
retain the same status after Conversion as these loans had prior to Conversion.
After Conversion, holders of Savings Accounts and obligors on loans of the Bank
will not have voting rights in the Converted Bank.  Exclusive voting rights with
respect to the Holding Company shall be vested in the holders of the Conversion
Stock issued by the Holding Company, and the Holding Company will have exclusive
voting rights with respect to the Converted Bank's Capital Stock.

XII.   Liquidation Account.

       After the Conversion, holders of Savings Accounts will not be entitled to
share in the residual assets after liquidation of the Converted Bank.  However,
pursuant to applicable regulations, the Bank shall, at the time of the
Conversion, establish a Liquidation Account in an amount equal to its regulatory
capital as of the date of the latest statement of financial condition contained
in the final prospectus to be used in connection with the Conversion.  The
function of the Liquidation Account is to establish a priority on liquidation,
and, except as provided in Paragraph VIII.G.2. above, the existence of the
Liquidation Account shall not operate to restrict the use or application of any
of the net worth accounts of the Converted Bank.

       The Liquidation Account shall be maintained by the Converted Bank
subsequent to Conversion for the benefit of Eligible Account Holders and
Supplemental Eligible Account Holders who retain their Savings Accounts in the
Converted Bank.  Each Eligible Account Holder and Supplemental Eligible Account
Holder shall, with respect to each Savings Account held, have a related inchoate
interest in a portion of the Liquidation Account ("subaccount balance").

       The initial subaccount balance for a Savings Account held by an Eligible
Account Holder and/or a Supplemental Eligible Account Holder shall be determined
by multiplying the opening balance in the Liquidation Account by a fraction of
which the numerator is the amount of the qualifying deposit in the related
Savings Account and the denominator is the total amount of the qualifying
deposits of all Eligible Account Holders and Supplemental Eligible Account
Holders in the Bank.  Such initial subaccount balance shall not be increased but
shall be subject to downward adjustment as provided below.

       If the deposit balance in any Savings Account of an Eligible Account
Holder or Supplemental Eligible Account Holder to which the subaccount relates
at the close of business on any annual closing date subsequent to the
Eligibility Record Date or Supplemental Eligibility Record Date is less than the
lesser of (i) the deposit balance in such Savings Account at the close of
business on any annual closing date subsequent to the Eligibility Record Date or
the Supplemental Eligibility Record Date, or (ii) the amount of the Qualifying
Deposit in such Savings Account on the Eligibility Record Date or the
Supplemental Eligibility Record Date, then the subaccount balance for such
Savings Account shall be adjusted by reducing such subaccount balance in an
amount proportionate to the reduction in such deposit balance. In the event of a
downward adjustment, the subaccount balance shall not be subsequently increased,
notwithstanding any increase in the deposit balance of the related Savings
Account. If any such Savings Account is closed, the related subaccount balance
shall be reduced to zero.

       In the event of a complete liquidation of the Converted Bank (and only in
such event), each Eligible Account Holder and Supplemental Eligible Account
Holder shall be entitled to receive a liquidation distribution from the
Liquidation Account in the amount of the then-current adjusted subaccount
balances for Savings Accounts then held before any liquidation distribution may
be made to stockholders.  No merger, consolidation, sale of bulk assets or
similar combination or transaction with another institution insured by the
Federal Deposit Insurance Corporation shall be 

                                     A-16
<PAGE>
 
considered to be a complete liquidation for these purposes. In such
transactions, the Liquidation Account shall be assumed by the surviving
institution.

XIII.  Restrictions on Acquisition of Holding Company.

            A.  Present regulations provide that for a period of three years
       following completion of the Conversion, no person (i.e., an individual, a
       group acting in concert, a corporation, a partnership, an association, a
       joint stock company, a trust or any unincorporated organization or
       similar company, a syndicate or any other group formed for the purpose of
       acquiring, holding or disposing of securities of an insured institution
       or its holding company) shall directly, or indirectly, offer to purchase
       or actually acquire the beneficial ownership of more than 10% of any
       class of Holding Company Stock without the prior approval of the OTS.
       However, approval is not required for purchases directly from the Holding
       Company or underwriters or a selling group acting on its behalf with a
       view towards public resale, or for purchases not exceeding 1% per annum
       of the shares outstanding, or for the acquisition of securities by one or
       more Tax-Qualified Employee Stock Benefit Plans of the Holding Company or
       the Converted Bank, provided that the plan or plans do not have
       beneficial ownership in the aggregate of more than 25% of any class of
       Holding Company Stock. Civil penalties may be imposed by the OTS for
       willful violation or assistance of any violation. Where any person,
       directly or indirectly, acquires beneficial ownership of more than 10% of
       any class of Holding Company Stock within such three-year period, without
       the prior approval of the OTS, Holding Company Stock beneficially owned
       by such person in excess of 10% shall not be counted as shares entitled
       to vote and shall not be voted by any person or counted as voting shares
       in connection with any matter submitted to the stockholders for a vote.

            B.  The Holding Company may provide in its Articles of Incorporation
       a provision that, for a period of five years following the date of the
       completion of the Conversion, no person shall directly or indirectly
       offer to acquire or actually acquire the beneficial ownership of more
       than 10% of any class of Holding Company Stock except with respect to
       purchases by one or more Tax-Qualified Employee Stock Benefit Plans of
       the Holding Company or Converted Bank. The Holding Company may provide in
       its Articles of Incorporation for such other provisions affecting the
       acquisition of Holding Company Stock as shall be determined by its Board
       of Directors.

XIV.   Interpretation and Amendment or Termination of the Plan.

       The Bank's Board of Directors shall have the sole discretion to interpret
and apply the provisions of the Plan to particular facts and circumstances and
to make all determinations necessary or desirable to implement such provisions,
including but not limited to matters with respect to giving preference to
natural persons and trusts of natural persons who are permanent Residents of the
Bank's Local Community, and any and all interpretations, applications and
determinations made by the Board of Directors in good faith and on the basis of
such information and assistance as was then reasonably available for such
purpose shall be conclusive and binding upon the Bank and its members and
subscribers in the Subscription and Community Offerings, subject to the
authority of the OTS.

       If deemed necessary or desirable, the Plan may be substantively amended
at any time prior to submission of the Plan and proxy materials to the Members
by a two-thirds vote of the Bank's Board of Directors. After submission of the
Plan and proxy materials to the Members, the Plan may be amended by a two-thirds
vote of the Bank's Board of Directors at any time prior to the Special Meeting
and at any time following such Special Meeting with the concurrence of the OTS.
In its discretion, the Board of Directors may modify or terminate the Plan upon
the order of the regulatory authorities without a resolicitation of proxies or
another Special Meeting.

       In the event that mandatory new regulations pertaining to conversions are
adopted by the OTS or any successor agency prior to the completion of the
Conversion, the Plan will be amended to conform to the new mandatory regulations
without a resolicitation of proxies or another Special Meeting.  In the event
that new conversion regulations 

                                     A-17
<PAGE>
 
adopted by the OTS or any successor agency prior to completion of the Conversion
contain optional provisions, the Plan may be amended to utilize such optional
provisions at the discretion of the Board of Directors without a resolicitation
of proxies or another Special Meeting.

       By adoption of the Plan, the Bank's Members authorize the Board of
Directors to amend and/or terminate the Plan under the circumstances set forth
above.

XV.    Expenses of the Conversion.

       The Holding Company and the Bank will use their best efforts to assure
that expenses incurred in connection with the Conversion shall be reasonable.

XVI.   Contributions to Tax-Qualified Employee Stock Benefit Plans.

       The Holding Company and the Converted Bank may make scheduled
discretionary contributions to their Tax-Qualified Employee Stock Benefit Plans,
provided such contributions do not cause the Converted Bank to fail to meet its
then-applicable regulatory capital requirements.

                                     A-18
<PAGE>
 
                                                                       EXHIBIT B

                        NORTHFIELD FEDERAL SAVINGS BANK

                             FEDERAL STOCK CHARTER



       Section 1.  Corporate Title.  The full corporate title of the savings
bank is Northfield Federal Savings Bank (the "savings bank").

       Section 2.  Office.  The home office shall be located in the County of
Baltimore, State of Maryland.

       Section 3.  Duration.  The duration of the savings bank is perpetual.

       Section 4.  Purpose and Powers.  The purpose of the savings bank is to
pursue any or all of the lawful objectives of a Federal savings bank chartered
under section 5 of the Home Owners' Loan Act and to exercise all of the express,
implied, and incidental powers conferred thereby and by all acts amendatory
thereof and supplemental thereto, subject to the Constitution and laws of the
United States as they are now in effect, or as they may hereafter be amended,
and subject to all lawful and applicable rules, regulations, and orders of the
Office of Thrift Supervision ("Office").

       Section 5.  Capital Stock.  The total number of shares of all classes of
capital stock that the savings bank has the authority to issue is 10,000,000, of
which 8,000,000 shares shall be common stock of par value of $0.01 per share and
of which 2,000,000 shares shall be serial preferred stock of par value of $0.01
per share.  The shares may be issued from time to time as authorized by the
board of directors without further approval of shareholders, except as otherwise
provided in this Section 5 or to the extent that such approval is required by
governing law, rule, or regulation.  The consideration for the issuance of the
shares shall be paid in full before their issuance and shall not be less than
the par value.  Neither promissory notes nor future services shall constitute
payment or part payment for the issuance of shares of the savings bank.  The
consideration for the shares shall be cash, tangible or intangible property (to
the extent direct investment in such property would be permitted), labor, or
services actually performed for the savings bank, or any combination of the
foregoing.  In the absence of actual fraud in the transaction, the value of such
property, labor, or services, as determined by the board of directors of the
savings bank, shall be conclusive.  In the case of a stock dividend, that part
of the retained earnings of the savings bank that is transferred to common stock
or paid-in capital accounts upon the issuance of shares as a stock dividend
shall be deemed to be the consideration for their issuance.

       Except for shares issued in the initial organization of the savings bank
or in connection with the conversion of the savings bank from the mutual to the
stock form of capitalization, no shares of capital stock (including shares
issuable upon conversion, exchange, or exercise of other securities) shall be
issued, directly or indirectly, to officers, directors, or controlling persons
of the savings bank other than as part of a general public offering or as
qualifying shares to a director, unless their issuance or the plan under which
they would be issued has been approved by a majority of the total votes eligible
to be cast at a legal meeting.

       Nothing contained in this Section 5 (or in any supplementary sections
hereto) shall entitle the holders of any class or series of capital stock to
vote as a separate class or series or to more than one vote per share, except as
to the cumulation of votes for the election of directors, unless the charter
otherwise provides that there shall be no such cumulative voting:  Provided,
That this restriction on voting separately by class or series shall not apply:

       (i)   To any provision which would authorize the holders of preferred
stock, voting as a class or series, to elect some members of the board of
directors, less than a majority thereof, in the event of default in the payment
of dividends on any class or series of preferred stock;

                                      B-1
<PAGE>
 
       (ii)  To any provision that would require the holders of preferred stock,
voting as a class or series, to approve the merger or consolidation of the
savings bank with another corporation or the sale, lease, or conveyance (other
than by mortgage or pledge) of properties or business in exchange for securities
of a corporation other than the savings bank if the preferred stock is exchanged
for securities of such other corporation:  Provided, That no provision may
require such approval for transactions undertaken with the assistance or
pursuant to the direction of the Office or the Federal Deposit Insurance
Corporation;

       (iii) To any amendment which would adversely change the specific terms of
any class or series of capital stock as set forth in this Section 5 (or in any
supplementary sections hereto), including any amendment which would create or
enlarge any class or series prior ranking thereto in rights and preferences.  An
amendment which increases the number of authorized shares of any class or series
of capital stock, or substitutes the surviving savings bank in a merger or
consolidation for the savings bank, shall not be considered to be such an
adverse change.

       A description of the different classes and series (if any) of the savings
bank's capital stock and a statement of the designations, and the relative
rights, preferences, and limitations of the shares of each class of and series
(if any) of capital stock are as follows:

       A.  Common Stock.  Except as provided in this Section 5 (or in any
supplementary sections thereto) the holders of common stock shall exclusively
possess all voting power.  Each holder of shares of the common stock shall be
entitled to one vote for each share held by each holder, except as to the
cumulation of votes for the election of directors, unless the charter otherwise
provides that there shall be no such cumulative voting.

       Whenever there shall have been paid, or declared and set aside for
payment, to the holders of the outstanding shares of any class of stock having
preference over the common stock as to the payment of dividends, the full amount
of dividends and of sinking fund, retirement fund, or other retirement payments,
if any, to which such holders are respectively entitled in preference to the
common stock, then dividends may be paid on the common stock and on any class or
series of stock entitled to participate therewith as to dividends out of any
assets legally available for the payment of dividends.

       In the event of any liquidation, dissolution, or winding up of the
savings bank, the holders of the common stock (and the holders of any class or
series of stock entitled to participate with the common stock in the
distribution of assets) shall be entitled to receive, in cash or in kind, the
assets of the savings bank available for distribution remaining after: (i)
Payment or provision for payment of the savings bank's debts and liabilities;
(ii) distributions or provision for distributions in settlement of its
liquidation account; and (iii) distributions or provisions for distributions to
holders of any class or series of stock having preference over the common stock
in the liquidation, dissolution, or winding up of the savings bank. Each share
of common stock shall have the same relative rights as and be identical in all
respects with all the other shares of common stock.

       B.  Preferred Stock.  The savings bank may provide in supplementary
sections to its charter for one or more classes of preferred stock, which shall
be separately identified.  The shares of any class may be divided into and
issued in series, with each series separately designated so as to distinguish
the shares thereof from the shares of all other series and classes.  The terms
of each series shall be set forth in a supplementary section to the charter.
All shares of the same class shall be identical except as to the following
relative rights and preferences, as to which there may be variations between
different series:

       (a) The distinctive serial designation and the number of shares
constituting such series;

                                      B-2
<PAGE>
 
       (b) The dividend rate or the amount of dividends to be paid on the shares
of such series, whether dividends shall be cumulative and, if so, from which
date(s) the payment date(s) for dividends, and the participating or other
special rights, if any, with respect to dividends;

       (c) The voting powers, full or limited, if any, of shares of such series;

       (d) Whether the shares of such series shall be redeemable and, if so, the
price(s) at which, and the terms and conditions on which such shares may be
redeemed;

       (e) The amount(s) payable upon the shares of such series in the event of
voluntary or involuntary liquidation, dissolution, or winding up of the savings
bank;

       (f) Whether the shares of such series shall be entitled to the benefit of
a sinking or retirement fund to be applied to the purchase or redemption of such
shares, and if so entitled, the amount of such fund and the manner of its
application, including the price(s) at which such shares may be redeemed or
purchased through the application of such fund;

       (g) Whether the shares of such series shall be convertible into, or
exchangeable for, shares of any other class or classes of stock of the savings
bank and, if so, the conversion price(s) or the rate(s) of exchange, and the
adjustments thereof, if any, at which such conversion or exchange may be made,
and any other terms and conditions of such conversion or exchange;

       (h) The price or other consideration for which the shares of such series
shall be issued; and

       (i) Whether the shares of such series which are redeemed or converted
shall have the status of authorized but unissued shares of serial preferred
stock and whether such shares may be reissued as shares of the same or any other
series of serial preferred stock.

       Each share of each series of serial preferred stock shall have the same
relative rights as and be identical in all respects with all the other shares of
the same series.

       The board of directors shall have authority to divide, by the adoption of
supplementary charter sections, any authorized class of preferred stock into
series, and, within the limitations set forth in this section and the remainder
of this charter, fix and determine the relative rights and preferences of the
shares of any series so established.

       Prior to the issuance of any preferred shares of a series established by
a supplementary charter section adopted by the board of directors, the savings
bank shall file with the Secretary to the Office a dated copy of that
supplementary section of this charter established and designating the series and
fixing and determining the relative rights and preferences thereof.

       Section 6.  Preemptive Rights.  Holders of the capital stock of the
savings bank shall not be entitled to preemptive rights with respect to any
shares of the savings bank which may be issued.

       Section 7.  Directors.  The savings bank shall be under the direction of
a board of directors. The authorized number of directors, as stated in the
savings bank's bylaws, shall not be fewer than five nor more than fifteen except
when a greater or lesser number is approved by the Director of the Office, or
his or her delegate.

                                      B-3
<PAGE>
 
     Section 8.  Amendment of Charter.  Except as provided in Section 5, no
amendment, addition, alteration, change, or repeal of this charter shall be
made, unless such is proposed by the board of directors of the savings bank,
approved by the shareholders by a majority of the votes eligible to be cast at a
legal meeting, unless a higher vote is otherwise required, and approved or
preapproved by the Office.


                                       NORTHFIELD FEDERAL SAVINGS



Attest:                             By:
       ---------------------------     --------------------------------- 
        J. Thomas Hoffman               G. Ronald Jobson
        Secretary                       President
                                     
                                     
Declared effective as of 
                         ---------

                                    DIRECTOR OF THE OFFICE OF THRIFT SUPERVISION



Attest:                             By:
       ---------------------------     --------------------------------- 



                                      B-4
<PAGE>
 
                                                                       EXHIBIT C
                                    BYLAWS
                        NORTHFIELD FEDERAL SAVINGS BANK

                            ARTICLE I - HOME OFFICE

     The home office of Northfield Federal Savings Bank (the "savings bank")
shall be 1844 E. Joppa Road, in the County of Baltimore, in the State of
Maryland.

                           ARTICLE II - SHAREHOLDERS

     Section 1.  Place of Meetings.  All annual and special meetings of
shareholders shall be held at the home office of the savings bank or at such
other convenient place as the board of directors may determine.

     Section 2.  Annual Meeting.  A meeting of the shareholders of the savings
bank for the election of directors and for the transaction of any other business
of the savings bank shall be held annually within 150 days after the end of the
savings bank's fiscal year on the second Tuesday of May, if not a legal holiday,
and if a legal holiday, then on the next day following which is not a legal
holiday, at 7:00 p.m., or at such other date and time within such 150-day period
as the board of directors may determine.

     Section 3.  Special Meetings.  Special meetings of the shareholders for any
purpose or purposes, unless otherwise prescribed by the regulations of the
Office of Thrift Supervision ("Office"), may be called at any time by the
chairman of the board, the president, or a majority of the board of directors,
and shall be called by the chairman of the board, the president, or the
secretary upon the written request of the holders of not less than one-tenth of
all of the outstanding capital stock of the savings bank entitled to vote at the
meeting.  Such written request shall state the purpose or purposes of the
meeting and shall be delivered to the home office of the savings bank addressed
to the chairman of the board, the president, or the secretary.

     Section 4.  Conduct of Meetings.  Annual and special meetings shall be
conducted in accordance with the most current edition of Robert's Rules of Order
unless otherwise prescribed by regulations of the Office or these bylaws or the
board of directors adopts another written procedure for the conduct of meetings.
The board of directors shall designate, when present, either the chairman of the
board or president to preside at such meetings.

     Section 5.  Notice of Meetings.  Written notice stating the place, day, and
hour of the meeting and the purpose(s) for which the meeting is called shall be
delivered not fewer than 20 nor more than 50 days before the date of the
meeting, either personally or by mail, by or at the direction of the chairman of
the board, the president, or the secretary, or the directors calling the
meeting, to each shareholder of record entitled to vote at such meeting.  If
mailed, such notice shall be deemed to be delivered when deposited in the mail,
addressed to the shareholder at the address as it appears on the stock transfer
books or records of the savings bank as of the record date prescribed in Section
6 of this Article II with postage prepaid.  When any shareholders' meeting,
either annual or special, is adjourned for 30 days or more, notice of the
adjourned meeting shall be given as in the case of an original meeting.  It
shall not be necessary to give any notice of the time and place of any meeting
adjourned for less than 30 days or of the business to be transacted at the
meeting, other than an announcement at the meeting at which such adjournment is
taken.

     Section 6.  Fixing of Record Date.  For the purpose of determining
shareholders entitled to notice of or to vote at any meeting of shareholders or
any adjournment, or shareholders entitled to receive payment of any dividend, or
in order to make a determination of shareholders for any other proper purpose,
the board of directors shall fix in advance a date as the record date for any
such determination of shareholders.  Such date in any case shall be not more
than 60 days and, in case of a meeting of shareholders, not fewer than 10 days
prior to the date on which the particular action, requiring such determination
of shareholders, is to be taken.  When a determination of shareholders entitled
to vote at 

                                      C-1
<PAGE>
 
any meeting of shareholders has been made as provided in this section, such
determination shall apply to any adjournment.

     Section 7.  Voting Lists.  At least 20 days before each meeting of the
shareholders, the officer or agent having charge of the stock transfer books for
shares of the savings bank shall make a complete list of the shareholders of
record entitled to vote at such meeting, or any adjournment thereof, arranged in
alphabetical order, with the address and the number of shares held by each.
This list of shareholders shall be kept on file at the home office of the
savings bank and shall be subject to inspection by any shareholder of record or
the shareholder's agent at any time during usual business hours for a period of
20 days prior to such meeting.  Such list shall also be produced and kept open
at the time and place of the meeting and shall be subject to inspection by any
shareholder of record or any shareholder's agent during the entire time of the
meeting.  The original stock transfer book shall constitute prima facie evidence
of the shareholders entitled to examine such list or transfer books or to vote
at any meeting of shareholders.  In lieu of making the shareholder list
available for inspection by shareholders as provided in the preceding paragraph,
the board of directors may elect to follow the procedures prescribed in
'552.6(d) of the Office's regulations as now or hereafter in effect.

     Section 8.  Quorum.  A majority of the outstanding shares of the savings
bank entitled to vote, represented in person or by proxy, shall constitute a
quorum at a meeting of shareholders.  If less than a majority of the outstanding
shares is represented at a meeting, a majority of the shares so represented may
adjourn the meeting from time to time without further notice.  At such adjourned
meeting at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally
notified.  The shareholders present at a duly organized meeting may continue to
transact business until adjournment, notwithstanding the withdrawal of enough
shareholders to constitute less than a quorum.  If a quorum is present, the
affirmative vote of the majority of the shares represented at the meeting and
entitled to vote on the subject matter shall be the act of the shareholders,
unless the vote of a greater number of shareholders voting together or voting by
classes is required by law or the charter.  Directors, however, are elected by a
plurality of the votes cast at an election of directors.

     Section 9.  Proxies.  At all meetings of shareholders, a shareholder may
vote by proxy executed in writing by the shareholder or by his or her duly
authorized attorney in fact.  Proxies may be given telephonically or
electronically as long as the holder uses a procedure for verifying the identity
of the shareholder.  Proxies solicited on behalf of the management shall be
voted as directed by the shareholder or, in the absence of such direction, as
determined by a majority of the board of directors.  No proxy shall be valid
more than eleven months from the date of its execution except for a proxy
coupled with an interest.

     Section 10.  Voting of Shares in the Name of Two or More Persons.  When
ownership stands in the name of two or more persons, in the absence of written
directions to the savings bank to the contrary, at any meeting of the
shareholders of the savings bank, any one or more of such shareholders may cast,
in person or by proxy, all votes to which such ownership is entitled.  In the
event an attempt is made to cast conflicting votes, in person or by proxy, by
the several persons in whose names shares of stock stand, the vote or votes to
which those persons are entitled shall be cast as directed by a majority of
those holding such and present in person or by proxy at such meeting, but no
votes shall be cast for such stock if a majority cannot agree.

     Section 11.  Voting of Shares of Certain Holders.  Shares standing in the
name of another corporation may be voted by any officer, agent, or proxy as the
bylaws of such corporation may prescribe, or, in the absence of such provision,
as the board of directors of such corporation may determine.  Shares held by an
administrator, executor, guardian, or conservator may be voted by him or her,
either in person or by proxy, without a transfer of such shares into his or her
name.  Shares standing in the name of a trustee may be voted by him or her,
either in person or by proxy, but no trustee shall be entitled to vote shares
held by him or her without a transfer of such shares into his or her name.
Shares held in trust in an IRA or Keogh Account, however, may be voted by the
savings bank if no other instructions are received.  Shares standing in the name
of a receiver may be voted by such receiver, and shares held by or under the
control of a receiver may be voted by such receiver without the transfer into
his or her name if authority to do so is contained in an appropriate order of
the court or other public authority by which such receiver was appointed.

                                      C-2
<PAGE>
 
     A shareholder whose shares are pledged shall be entitled to vote such
shares until the shares have been transferred into the name of the pledgee, and
thereafter the pledgee shall be entitled to vote the shares so transferred.

     Neither treasury shares of its own stock held by the savings bank nor
shares held by another corporation, if a majority of the shares entitled to vote
for the election of directors of such other corporation are held by the savings
bank, shall be voted at any meeting or counted in determining the total number
of outstanding shares at any given time for purposes of any meeting.

     Section 12.  Inspectors of Election.  In advance of any meeting of
shareholders, the board of directors may appoint any person other than nominees
for office as inspectors of election to act at such meeting or any adjournment.
The number of inspectors shall be either one or three.  Any such appointment
shall not be altered at the meeting.  If inspectors of election are not so
appointed, the chairman of the board or the president may, or on the request of
not fewer than 10 percent of the votes represented at the meeting shall, make
such appointment at the meeting.  If appointed at the meeting, the majority of
the votes present shall determine whether one or three inspectors are to be
appointed.  In case any person appointed as inspector fails to appear or fails
or refuses to act, the vacancy may be filled by appointment by the board of
directors in advance of the meeting or at the meeting by the chairman of the
board or the president.

     Unless otherwise prescribed by regulations of the Office, the duties of
such inspectors shall include:  determining the number of shares and the voting
power of each share, the shares represented at the meeting, the existence of a
quorum, and the authenticity, validity and effect of proxies; receiving votes,
ballots, or consents; hearing and determining all challenges and questions in
any way arising in connection with the rights to vote; counting and tabulating
all votes or consents; determining the result; and such acts as may be proper to
conduct the election or vote with fairness to all shareholders.

     Section 13.  Nominating Committee.  The board of directors shall act as a
nominating committee for selecting the management nominees for election as
directors.  Except in the case of a nominee substituted as a result of the death
or other incapacity of a management nominee, the nominating committee shall
deliver written nominations to the secretary at least 20 days prior to the date
of the annual meeting.  Upon delivery, such nominations shall be posted in a
conspicuous place in each office of the savings bank.  No nominations for
directors except those made by the nominating committee shall be voted upon at
the annual meeting unless other nominations by shareholders are made in writing
and delivered to the secretary of the savings bank at least five days prior to
the date of the annual meeting.  Upon delivery, such nominations shall be posted
in a conspicuous place in each office of the savings bank.  Ballots bearing the
names of all persons nominated by the nominating committee and by shareholders
shall be provided for use at the annual meeting.  However, if the nominating
committee shall fail or refuse to act at least 20 days prior to the annual
meeting, nominations for directors may be made at the annual meeting by any
shareholder entitled to vote and shall be voted upon.

     Section 14.  New Business.  Any new business to be taken up at the annual
meeting shall be stated in writing and filed with the secretary of the savings
bank at least five days before the date of the annual meeting, and all business
so stated, proposed, and filed shall be considered at the annual meeting; but no
other proposal shall be acted upon at the annual meeting.  Any shareholder may
make any other proposal at the annual meeting and the same may be discussed and
considered, but unless stated in writing and filed with the secretary at least
five days before the meeting, such proposal shall be laid over for action at an
adjourned, special, or annual meeting of the shareholders taking place 30 days
or more thereafter.  This provision shall not prevent the consideration and
approval or disapproval at the annual meeting of reports of officers, directors,
and committees; but in connection with such reports, no new business shall be
acted upon at such annual meeting unless stated and filed as herein provided.

     Section 15.  Informal Action by Shareholders.  Any action required to be
taken at a meeting of the shareholders, or any other action which may be taken
at a meeting of shareholders, may be taken without a meeting if consent in
writing, setting forth the action so taken, shall be given by all of the
shareholders entitled to vote with respect to the subject matter.

                                      C-3
<PAGE>
 
                       ARTICLE III - BOARD OF DIRECTORS

     Section 1.  General Powers.  The business and affairs of the savings bank
shall be under the direction of its board of directors.  The board of directors
shall annually elect a chairman of the board and a president from among its
members and shall designate, when present, either the chairman of the board or
the president to preside at its meetings.

     Section 2.  Number and Term.  The board of directors shall consist of six
(6) members and shall be divided into three classes as nearly equal in number as
possible.  The members of each class shall be elected for a term of three years
and until their successors are elected and qualified.  One class shall be
elected by ballot annually.

     Section 3.  Regular Meetings.  A regular meeting of the board of directors
shall be held without other notice than this bylaw following the annual meeting
of shareholders.  The board of directors may provide, by resolution, the time
and place for the holding of additional regular meetings without other notice
than such resolution.  Directors may participate in a meeting by means of a
conference telephone or similar communications device through which all persons
participating can hear each other at the same time.  Participation by such means
shall constitute presence in person for all purposes.

     Section 4.  Qualification.  Each director shall at all times be the
beneficial owner of not less than 100 shares of capital stock of the savings
bank unless the savings bank is a wholly owned subsidiary of a holding company.

     Section 5.  Special Meetings.  Special meetings of the board of directors
may be called by or at the request of the chairman of the board, the president,
or one-third of the directors.  The persons authorized to call special meetings
of the board of directors may fix any place, within the savings bank's normal
lending territory, as the place for holding any special meeting of the board of
directors called by such persons.

     Members of the board of directors may participate in special meetings by
means of conference telephone or similar communications equipment by which all
persons participating in the meeting can hear each other.  Such participation
shall constitute presence in person for all purposes.

     Section 6.  Notice.  Written notice of any special meeting shall be given
to each director at least 24 hours prior thereto when delivered personally or by
telegram or at least five days prior thereto when delivered by mail at the
address at which the director is most likely to be reached.  Such notice shall
be deemed to be delivered when deposited in the mail so addressed, with postage
prepaid if mailed, when delivered to the telegraph company if sent by telegram
or, when the savings bank receives notice of delivery if electronically
transmitted.  Any director may waive notice of any meeting by a writing filed
with the secretary.  The attendance of a director at a meeting shall constitute
a waiver of notice of such meeting, except where a director attends a meeting
for the express purpose of objecting to the transaction of any business because
the meeting is not lawfully called or convened.  Neither the business to be
transacted at, nor the purpose of, any meeting of the board of directors need be
specified in the notice of waiver of notice of such meeting.

     Section 7.  Quorum.  A majority of the number of directors fixed by Section
2 of this Article III shall constitute a quorum for the transaction of business
at any meeting of the board of directors; but if less than such majority is
present at a meeting, a majority of the directors present may adjourn the
meeting from time to time.  Notice of any adjourned meeting shall be given in
the same manner as prescribed by Section 6 of this Article III.

     Section 8.  Manner of Acting.  The act of the majority of the directors
present at a meeting at which a quorum is present shall be the act of the board
of directors, unless a greater number is prescribed by regulation of the Office
or by these bylaws.

     Section 9.  Action Without a Meeting.  Any action required or permitted to
be taken by the board of directors at a meeting may be taken without a meeting
if a consent in writing, setting forth the action so taken, shall be signed by
all of the directors.

                                      C-4
<PAGE>
 
     Section  10.  Resignation.  Any director may resign at any time by sending
a written notice of such resignation to the home office of the savings bank
addressed to the chairman of the board or the president.  Unless otherwise
specified, such resignation shall take effect upon receipt by the chairman of
the board or the president.  More than three consecutive absences from regular
meetings of the board of directors, unless excused by resolution of the board of
directors, shall automatically constitute a resignation, effective when such
resignation is accepted by the board of directors.

     Section 11.  Vacancies.  Any vacancy occurring on the board of directors
may be filled by the affirmative vote of a majority of the remaining directors
although less than a quorum of the board of directors.  A director elected to
fill a vacancy shall be elected to serve until the next election of directors by
the shareholders.  Any directorship to be filled by reason of an increase in the
number of directors may be filled by election by the board of directors for a
term of office continuing only until the next election of directors by the
shareholders.

     Section 12.  Compensation.  Directors, as such, may receive a stated salary
for their services.  By resolution of the board of directors, a reasonable fixed
sum, and reasonable expenses of attendance, if any, may be allowed for
attendance at each regular or special meeting of the board of directors.
Members of either standing or special committees may be allowed such
compensation for attendance at committee meetings as the board of directors may
determine.

     Section 13.  Presumption of Assent.  A director of the savings bank who is
present at a meeting of the board of directors at which action on any savings
bank matter is taken shall be presumed to have assented to the action taken
unless his or her dissent or abstention shall be entered in the minutes of the
meeting or unless he or she shall file a written dissent to such action with the
person acting as the secretary of the meeting before the adjournment thereof or
shall forward such dissent by registered mail to the secretary of the savings
bank within five days after the date a copy of the minutes of the meeting is
received.  Such right to dissent shall not apply to a director who voted in
favor of such action.

     Section 14.  Removal of Directors.  At a meeting of shareholders called
expressly for that purpose, any director may be removed for cause by a vote of
the holders of a majority of the shares then entitled to vote at an election of
directors.  Whenever the holders of the shares of any class are entitled to
elect one or more directors by the provisions of the charter or supplemental
sections thereto, the provisions of this section shall apply, in respect to the
removal of a director or directors so elected, to the vote of the holders of the
outstanding shares of that class and not to the vote of the outstanding shares
as a whole.

     Section 15.  Age Limitation.  No person seventy (70) years of age shall be
eligible for election, reelection, appointment, or reappointment to the board of
directors of the savings bank.  No person shall serve as a director beyond the
annual meeting of the savings bank immediately following the director becoming
age 70, except that a director serving on the date of the adoption of the mutual
bylaws of Northfield Federal Savings may complete the term as director.  This
age limitation does not apply to an advisory director.

     The age limitation contained in these bylaws shall not be applicable to any
director holding office on the date of the adoption of the mutual bylaws of
Northfield Federal Savings.


                  ARTICLE IV - EXECUTIVE AND OTHER COMMITTEES

     Section 1.  Appointment.  The board of directors, by resolution adopted by
a majority of the full board, may designate the chief executive officer and two
or more of the other directors to constitute an executive committee.  The
designation of any committee pursuant to this Article IV and the delegation of
authority shall not operate to relieve the board of directors, or any director,
of any responsibility imposed by law or regulation.

                                      C-5
<PAGE>
 
     Section 2.  Authority.  The executive committee, when the board of
directors is not in session, shall have and may exercise all of the authority of
the board of directors except to the extent, if any, that such authority shall
be limited by the resolution appointing the executive committee; and except also
that the executive committee shall not have the authority of the board of
directors with reference to:  the declaration of dividends; the amendment of the
charter or bylaws of the savings bank, or recommending to the shareholders a
plan of merger, consolidation, or conversion; the sale, lease, or other
disposition of all or substantially all of the property and assets of the
savings bank otherwise than in the usual and regular course of its business; a
voluntary dissolution of the savings bank; a revocation of any of the foregoing;
or the approval of a transaction in which any member of the executive committee,
directly or indirectly, has any material beneficial interest.

     Section 3.  Tenure.  Subject to the provisions of Section 8 of this Article
IV, each member of the executive committee shall hold office until the next
regular annual meeting of the board of directors following his or her
designation and until a successor is designated as a member of the executive
committee.

     Section 4.  Meetings.  Regular meetings of the executive committee may be
held without notice at such times and places as the executive committee may fix
from time to time by resolution.  Special meetings of the executive committee
may be called by any member thereof upon not less than one day's notice stating
the place, date, and hour of the meeting, which notice may be written or oral.
Any member of the executive committee may waive notice of any meeting and no
notice of any meeting need be given to any member thereof who attends in person.
The notice of a meeting of the executive committee need not state the business
proposed to be transacted at the meeting.

     Section 5.  Quorum.  A majority of the members of the executive committee
shall constitute a quorum for the transaction of business at any meeting
thereof, and action of the executive committee must be authorized by the
affirmative vote of a majority of the members present at a meeting at which a
quorum is present.

     Section 6.  Action Without a Meeting.  Any action required or permitted to
be taken by the executive committee at a meeting may be taken without a meeting
if a consent in writing, setting forth the action so taken, shall be signed by
all of the members of the executive committee.

     Section 7.  Vacancies.  Any vacancy in the executive committee may be
filled by a resolution adopted by a majority of the full board of directors.

     Section 8.  Resignations and Removal.  Any member of the executive
committee may be removed at any time with or without cause by resolution adopted
by a majority of the full board of directors.  Any member of the executive
committee may resign from the executive committee at any time by giving written
notice to the president or secretary of the savings bank.  Unless otherwise
specified, such resignation shall take effect upon its receipt; the acceptance
of such resignation shall not be necessary to make it effective.

     Section 9.  Procedure.  The executive committee shall elect a presiding
officer from its members and may fix its own rules of procedure which shall not
be inconsistent with these bylaws.  It shall keep regular minutes of its
proceedings and report the same to the board of directors for its information at
the meeting held next after the proceedings shall have occurred.

     Section 10.  Other Committees.  The board of directors may by resolution
establish an audit, loan, or other committee composed of directors as they may
determine to be necessary or appropriate for the conduct of the business of the
savings bank and may prescribe the duties, constitution, and procedures thereof.

                                      C-6
<PAGE>
 
                             ARTICLE V - OFFICERS

     Section 1.  Positions.  The officers of the savings bank shall be a
president, one or more vice presidents, a secretary, and a treasurer or
comptroller, each of whom shall be elected by the board of directors.  The board
of directors may also designate the chairman of the board as an officer.  The
offices of the secretary and treasurer or comptroller may be held by the same
person and a vice president may also be either the secretary or the treasurer or
comptroller.  The board of directors may designate one or more vice presidents
as executive vice president or senior vice president.  The board of directors
may also elect or authorize the appointment of such other officers as the
business of the savings bank may require.  The officers shall have such
authority and perform such duties as the board of directors may from time to
time authorize or determine.  In the absence of action by the board of
directors, the officers shall have such powers and duties as generally pertain
to their respective offices.

     Section 2.  Election and Term of Office.  The officers of the savings bank
shall be elected annually at the first meeting of the board of directors held
after each annual meeting of the shareholders.  If the election of officers is
not held at such meeting, such election shall be held as soon thereafter as
possible.  Each officer shall hold office until a successor has been duly
elected and qualified or until the officer's death, resignation, or removal in
the manner hereinafter provided.  Election or appointment of an officer,
employee, or agent shall not of itself create contractual rights.  The board of
directors may authorize the savings bank to enter into an employment contract
with any officer in accordance with regulations of the Office, but no such
contract shall impair the right of the board of directors to remove any officer
at any time in accordance with Section 3 of this Article V.

     Section 3.  Removal.  Any officer may be removed by the board of directors
whenever in its judgment the best interests of the savings bank will be served
thereby, but such removal, other than for cause, shall be without prejudice to
any contractual rights, if any, of the person so removed.

     Section 4.  Vacancies.  A vacancy in any office because of death,
resignation, removal, disqualification, or otherwise may be filled by the board
of directors for the unexpired portion of the term.

     Section 5.  Remuneration.  The remuneration of the officers shall be fixed
from time to time by the board of directors.

     Section 6.  Age Limitation.  No person seventy (70) years of age shall be
eligible for election, reelection, appointment or reappointment as an officer of
the savings bank.  No officer shall serve beyond the annual meeting of the
savings bank immediately following the officer becoming age seventy (70), except
that an officer serving on the date of the adoption of the mutual bylaws of
Northfield Federal Savings may complete the term.


              ARTICLE VI - CONTRACTS, LOANS, CHECKS, AND DEPOSITS

     Section 1.  Contracts.  To the extent permitted by regulations of the
Office, and except as otherwise prescribed by these bylaws with respect to
certificates for shares, the board of directors may authorize any officer,
employee, or agent of the savings bank to enter into any contract or execute and
deliver any instrument in the name of and on behalf of the savings bank.  Such
authority may be general or confined to specific instances.

     Section 2.  Loans.  No loans shall be contracted on behalf of the savings
bank and no evidence of indebtedness shall be issued in its name unless
authorized by the board of directors.  Such authority may be general or confined
to specific instances.

     Section 3.  Checks, Drafts, etc.  All checks, drafts, or other orders for
the payment of money, notes, or other evidences of indebtedness issued in the
name of the savings bank shall be signed by one or more officers, employees or
agents of the savings bank in such manner as shall from time to time be
determined by the board of directors.

                                      C-7
<PAGE>
 
     Section 4.  Deposits.  All funds of the savings bank not otherwise employed
shall be deposited from time to time to the credit of the savings bank in any
duly authorized depositories as the board of directors may select.


           ARTICLE VII - CERTIFICATES FOR SHARES AND THEIR TRANSFER

     Section 1.  Certificates for Shares.  Certificates representing shares of
capital stock of the savings bank shall be in such form as shall be determined
by the board of directors and approved by the Office.  Such certificates shall
be signed by the chief executive officer or by any other officer of the savings
bank authorized by the board of directors, attested by the secretary or an
assistant secretary, and sealed with the corporate seal or a facsimile thereof.
The signatures of such officers upon a certificate may be facsimiles if the
certificate is manually signed on behalf of a transfer agent or a registrar
other than the savings bank itself or one of its employees.  Each certificate
for shares of capital stock shall be consecutively numbered or otherwise
identified.  The name and address of the person to whom the shares are issued,
with the number of shares and date of issue, shall be entered on the stock
transfer books of the savings bank.  All certificates surrendered to the savings
bank for transfer shall be canceled and no new certificate shall be issued until
the former certificate for a like number of shares has been surrendered and
canceled, except that in the case of a lost or destroyed certificate, a new
certificate may be issued upon such terms and indemnity to the savings bank as
the board of directors may prescribe.

     Section 2.  Transfer of Shares.  Transfer of shares of capital stock of the
savings bank shall be made only on its stock transfer books.  Authority for such
transfer shall be given only by the holder of record or by his or her legal
representative, who shall furnish proper evidence of such authority, or by his
or her attorney authorized by a duly executed power of attorney and filed with
the savings bank.  Such transfer shall be made only on surrender for
cancellation of the certificate for such shares.  The person in whose name
shares of capital stock stand on the books of the savings bank shall be deemed
by the savings bank to be the owner for all purposes.


                   ARTICLE VIII - FISCAL YEAR; ANNUAL AUDIT

     The fiscal year of the savings bank shall end on the 31st  day of December
of each year.  The appointment of such independent accountants shall be subject
to annual ratification by the shareholders.


                            ARTICLE IX - DIVIDENDS

     Subject to the terms of the savings bank's charter and the regulations and
orders of the Office, the board of directors may, from time to time, declare,
and the savings bank may pay, dividends on its outstanding shares of capital
stock.

                          ARTICLE X - CORPORATE SEAL

     The board of directors shall provide a savings bank seal which shall be two
concentric circles between which shall be the name of the savings bank.  The
year of incorporation or an emblem may appear in the center.


                            ARTICLE XI - AMENDMENTS

     These bylaws may be amended in a manner consistent with regulations of the
Office and shall be effective after (i) the approval of the amendment by a
majority vote of the authorized board of directors, or by a majority of the
votes cast by the shareholders of the savings bank at any legal meeting, and
(ii) receipt of any applicable regulatory approval.  When the savings bank fails
to meet its quorum requirements, solely due to vacancies on the board, then the
affirmative vote of a majority of the sitting board will be required to amend
the bylaws.

                                      C-8
<PAGE>
 
                                REVOCABLE PROXY

               (SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
                          NORTHFIELD FEDERAL SAVINGS

                       FOR A SPECIAL MEETING OF MEMBERS
                       TO BE HELD ON ____________, 1998)


     The undersigned member of Northfield Federal Savings (the "Association")
hereby appoints _______________, ____________  and _________________, or any one
of them, with full powers of substitution, as attorneys-in-fact and agents for
and in the name of the undersigned, to vote such votes as the undersigned may be
entitled to cast at the Special Meeting of Members of the Association (the
"Meeting") to be held at __________________, ____________________, Baltimore,
Maryland, on ________________, _____________, 1998, at __:__ .m., Eastern Time,
and at any adjournments thereof.  They are authorized to cast all votes to which
the undersigned is entitled, as follows:

 
                                                              FOR     AGAINST  
                                                              ---     -------   
                                                 

           Approval of the Plan of Conversion providing for
           the conversion of the Association from a
           federally chartered mutual savings association to
           a federally chartered stock savings bank, to be
           known as "Northfield Federal Savings Bank" (the
           "Bank"), as a wholly owned subsidiary of
           Northfield Bancorp, Inc., including the amendment
           of the Association's Federal Mutual Charter and
           Bylaws to read in the form of a Federal Stock
           Charter and Bylaws for the Bank.
                     
                                                               [_]     [_]
 
            In their discretion, on any other matters that
            may lawfully come before the Meeting.


NOTE:  The Board of Directors is not aware of any other matters that may come
before the Meeting.
<PAGE>
 
            THIS PROXY WILL BE VOTED FOR THE PLAN OF CONVERSION IF
                           NO CHOICE IS MADE HEREON


     Should the undersigned be present and elect to vote at said Meeting or at
any adjournment thereof and, after notification to the Secretary of Northfield
Federal Savings at said Meeting of the member's decision to terminate this
Proxy, then the power of said attorneys-in-fact or agents shall be deemed
terminated and of no further force and effect. The undersigned hereby revokes
any and all proxies heretofore given.

     The undersigned acknowledges receipt of a Notice of Special Meeting of the
Members of Northfield Federal Savings to be held on ___________, 1998 and a
Proxy Statement dated ______________, 1998 and a Prospectus dated
______________, 1998 prior to the execution of this Proxy.



                                        ---------------------------
                                                   Date          
                                                                   
                                                                   
                                                                   
                                        ---------------------------
                                                 Signature



                                        Note: Only one signature is required in
                                              the case of a joint account.

<PAGE>
 
                           NORTHFIELD BANCORP, INC.
                         PROPOSED HOLDING COMPANY FOR
                          NORTHFIELD FEDERAL SAVINGS
                              BALTIMORE, MARYLAND


                         PROPOSED MARKETING MATERIALS

                                    3-19-98
<PAGE>
 
                              Marketing Materials
                           Northfield Bancorp, Inc.
                              Baltimore, Maryland

                               Table of Contents
                               -----------------

<TABLE> 
<CAPTION> 
<S>    <C> 
I.     Press Releases
       A.  Explanation
       B.  Schedule
       C.  Distribution List
       D.  Press Release Examples

II.    Advertisements
       A.  Explanation
       B.  Schedule
       C.  Advertisement Examples

III.   Question and Answer Brochure

IV.    Individual Letters and Community Meeting Invitations

V.     IRA Mailing
       A.  Explanation
       B.  Quantity
       C.  IRA Mailing Example

VI.    Counter Cards and Lobby Posters
       A.  Explanation
       B.  Quantity

VII.   Proxy Reminder
       A.   Explanation
       B.  Example
</TABLE> 
<PAGE>
 
                              I.  Press Releases

A.   Explanation

     In an effort to assure that all customers receive prompt accurate
     information in a simultaneous manner, Trident advises the Savings Bank to
     forward press releases to area newspapers, radio stations, etc. at various
     points during the conversion process.

     Only press releases approved by Conversion Counsel and the OTS will be
     forwarded for publication in any manner.

B.   Schedule

     1. OTS Approval of Conversion

     2. Close of Stock Offering
<PAGE>
 
                             C.  Distribution List

                          National Distribution List
                          --------------------------


National Thrift News                            Wall Street Journal
- --------------------                            -------------------
212 West 35th Street                            World Financial Center
13th Floor                                      200 Liberty
New York, New York  10001                       New York, NY  10004
Richard Chang
 
American Banker                                 SNL Securities
- ---------------                                 --------------
One State Street Plaza                          Post Office Box 2124
New York, New York  10004                       Charlottesville, Virginia  22902
Michael Weinstein
 
Barrons                                         Investors Business Daily
- -------                                         ------------------------
Dow Jones & Savings Bank                        12655 Beatrice Street
Barrons Statistical Information                 Post Office Box 661750
200 Burnett Road                                Los Angeles, California  90066
Chicopee, Massachusetts  01020

New York Times
- --------------
229 West 43rd Street
New York, NY  10036
<PAGE>
 
                                 Local Media List
                                 ----------------

                                 (To be provided)


Newspaper
- ---------

Radio
- -----
<PAGE>
 
D.   Press Release Examples
     PRESS RELEASE                           FOR IMMEDIATE RELEASE
                                             ---------------------
                                             For More Information Contact:
                                             G. Ronald Jobson,
                                             President and CEO
                                             (410) 665-7900


                          NORTHFIELD FEDERAL SAVINGS
                          --------------------------

                       CONVERSION TO STOCK FORM APPROVED
                       ---------------------------------


     Baltimore, Maryland (February 20, 1998) - G. Ronald Jobson, President and
CEO of Northfield Federal Savings ("Northfield Federal"), Baltimore, Maryland,
announced that Northfield Federal has received approval from the Office of
Thrift Supervision to convert from a federally-chartered mutual savings bank to
a federally-chartered stock savings bank. In connection with the Conversion,
Northfield Federal has formed a holding company, Northfield Bancorp, Inc., to
hold all of the outstanding capital stock of Northfield Federal Savings.

     Northfield Bancorp, Inc. is offering up to 595,125 shares of its common
stock, subject to adjustment, at a price of $10.00 per share. Certain account
holders and borrowers of Northfield Federal will have an opportunity to
subscribe for stock through a Subscription Offering that closes on May __, 1998.
Shares that are not subscribed for during the Subscription Offering may be
offered subsequently to the general public in a Direct Community Offering, with
first preference given to natural persons and trusts of natural persons residing
in Baltimore, Harford and Cecil Counties, Maryland. The Subscription Offering
and Community Offering, if conducted, will be managed by Trident Securities,
Inc. of Raleigh, North Carolina. Copies of the Prospectus relating to the
offerings and describing the Plan of Conversion will be mailed to customers on
April __, 1998.

     As a result of the Conversion, Northfield Federal Savings will be
structured in the stock form as are all commercial banks and an increasing
number of savings institutions and will be a 
<PAGE>
 
wholly-owned subsidiary of Northfield Bancorp, Inc. According to Mr. Jobson,
"Our day to day operations will not change as a result of the Conversion and
deposits will continue to be insured by the FDIC up to the applicable legal
limits."

     Customers with questions concerning the stock offering should call
Northfield Federal's Stock Information Center at (410) 668-2160, or visit
Northfield Federal's office.
<PAGE>
 
PRESS RELEASE                                FOR IMMEDIATE RELEASE
                                             ---------------------
                                             For More Information Contact:
                                             G. Ronald Jobson
                                             (410) 665-7900


           NORTHFIELD BANCORP, INC. COMPLETES INITIAL STOCK OFFERING
           ---------------------------------------------------------

     Baltimore, Maryland - (__________, 1998) G. Ronald Jobson, President of
Northfield Federal Savings ("Northfield Federal" or the "Savings Bank"),
announced today that Northfield Bancorp, Inc., the proposed holding company for
Northfield Federal, has completed its initial stock offering in connection with
the Savings Bank's conversion from mutual to stock form. A total of __________
shares were sold at the price of $10.00 per share.

     On __________, 1998, Northfield Federal's Plan of Conversion was approved
by the Savings Bank's voting members at a special meeting of members.

     Mr. Jobson said that the officers and boards of directors of Northfield
Bancorp, Inc. and the Savings Bank wished to express their thanks for the
response to the stock offering and that Northfield Federal looks forward to
serving the needs of its customers and new stockholders as a community-based
stock institution. The stock is anticipated to commence trading on __________,
1998 on the OTC Electronic Bulletin Board under the symbol "____". Trident
Securities, Inc. of Raleigh, North Carolina managed the stock offering.
<PAGE>
 
                                 II.  Advertisements


A.   Explanation

     The intended use of the attached advertisement "A" is to notify Northfield
     Federal's customers and members of the local community that the conversion
     offering is underway.

     The intended use of advertisement "B" is to remind Northfield Federal's
     customers of the closing date of the Subscription Offering.

B.   Media Schedule

     1.   Advertisement A - To be run immediately following OTS approval and
          possibly run weekly for the first three weeks.
     2.   Advertisement B - To be run during the last week of the subscription
          offering.

     Trident may feel it is necessary to run more ads in order to remind

     customers of the close of the Subscription Offering and the Community
     Offering, if conducted.

     Alternatively, Trident may, depending upon the response from the customer
     base, choose to run fewer ads or no ads at all.

     These ads will run in the local newspapers.

     The ad size will be as shown or smaller.
<PAGE>
 
________________________________________________________________________________

 This announcement is neither an offer to sell nor a solicitation of an offer to
 buy these securities. The offer is made only by the prospectus. These shares
 have not been approved or disapproved by the Securities and Exchange
 Commission, the Office of Thrift Supervision or the Federal Deposit Insurance
 Corporation, nor has such commission, office or corporation passed upon the
 accuracy or adequacy of the prospectus. Any representation to the contrary is
 unlawful.



NEW ISSUE                                                     ____________, 1998

                                595,125 SHARES

                    These shares are being offered pursuant
                        to a Plan of Conversion whereby

                          NORTHFIELD FEDERAL SAVINGS


                           Baltimore, Maryland, will
                  convert from a federal mutual savings bank
                    to a federal capital stock savings bank
                    and become a wholly owned subsidiary of

                           NORTHFIELD BANCORP, INC.

                                 COMMON STOCK

                                _______________

                            PRICE $10.00 PER SHARE
                                _______________


                           TRIDENT SECURITIES, INC.

               For a copy of the prospectus call (410) ________.

Copies of the prospectus may be obtained in any State in which this announcement
 is circulated from Trident Securities, Inc. or such other brokers and dealers
             as may legally offer these securities in such state.

   THE STOCK WILL NOT BE INSURED BY THE FDIC OR ANY OTHER GOVERNMENT AGENCY.

________________________________________________________________________________
<PAGE>
 
Advertisement (B)

     _______________________________________________________________________

                              NORTHFIELD FEDERAL

                      __________, 1998 IS THE DEADLINE TO
                    ORDER STOCK OF NORTHFIELD BANCORP, INC.


                    Customers of Northfield Federal Savings
                             have the opportunity
                    to invest in Northfield Federal Savings
                                by subscribing
               for common stock in its proposed holding company

                           NORTHFIELD BANCORP, INC.

                 A Prospectus relating to these securities is
                   available at our office or by calling our
                  Stock Information Center at (410) ________.


              This announcement is neither an offer to sell nor a
                 solicitation of an offer to buy the stock of
            Northfield Bancorp, Inc.  The offer is made only by the
                Prospectus.  The shares of common stock are not
             deposits or savings accounts and will not be insured
                 by the Federal Deposit Insurance Corporation
                        or any other government agency.

                Copies of the Prospectus may be obtained in any
                       State in which this announcement
                is circulated from Trident Securities, Inc. or
                        such other brokers and dealers
                 as may legally offer these securities in such state.
                                    
     _______________________________________________________________________
<PAGE>
 
                      III.  Question and Answer Brochure

A.   Explanation

     The Question and Answer brochure is an essential marketing piece in any
     conversion. It serves two purposes: a) to answer some of the most commonly
     asked questions in "plain, everyday language"; and b) to highlight in
     brochure form the purchase commitments of the Savings Bank's officers and
     directors shown in the Prospectus. Although most of the answers are taken
     verbatim from the Prospectus, it saves the individual from searching for
     the answer to a simple question.

B.   Method of Distribution

     There are four primary methods of distribution of the Question and Answer
     brochure. However, regardless of the method the brochures are always
     accompanied by a Prospectus.

     1.   A Question and Answer brochure is sent out in the initial mailing to
          all members of the Savings Bank.
     2.   Question and Answer brochures are available in Northfield Federal's
          office.
     3.   Question and Answer brochures are sent out in a standard information
          packet to all interested investors who phone the Stock Information
          Center requesting information.
<PAGE>
 
                    PROPOSED OFFICER AND DIRECTOR PURCHASES

<TABLE> 
<CAPTION> 
                    Total Shares    Aggregate Price of      Percent of Shares
Name and Position     Purchased      Shares Purchased           Purchased
- -----------------   ------------    -----------------       -----------------
<S>                 <C>             <C>                     <C> 
</TABLE> 

INFORMATION TO BE PROVIDED
<PAGE>
 
                             QUESTIONS AND ANSWERS
                                   REGARDING
                            THE PLAN OF CONVERSION

On ________, 1997, the Board of Directors of Northfield Federal Savings
("Northfield Federal" or the "Savings Bank") unanimously adopted the Plan of
Conversion, pursuant to which Northfield Federal will convert from a federally-
chartered mutual savings bank to a federally-chartered stock savings bank. In
addition, all of Northfield Federal's outstanding capital stock will be issued
to Northfield Bancorp, Inc. (the "Holding Company"), which was organized by
Northfield Federal Savings to own Northfield Federal Savings as a subsidiary.

This brochure is provided to answer general questions you might have about the
Conversion. Following the Conversion, Northfield Federal Savings will continue
to provide financial services to its depositors, borrowers and other customers
as it has in the past and will operate with its existing management and
employees.  The Conversion will not affect the terms, balances, interest rates
or existing federal insurance coverage on Northfield Federal's deposits or the
terms or conditions of any loans to existing borrowers under their individual
contract arrangements with Northfield Federal Savings.

For complete information regarding the Conversion, see the Prospectus and the
Proxy Statement dated __________ __, 1998.  Copies of each of the Prospectus and
the Proxy Statement may be obtained by calling the Stock Information Center at
(410) ________.

THIS INFORMATION DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY NORTHFIELD BANCORP, INC. COMMON STOCK. OFFERS TO BUY OR TO SELL MAY
BE MADE ONLY BY THE PROSPECTUS. PLEASE READ THE PROSPECTUS PRIOR TO MAKING AN
INVESTMENT DECISION. THE SHARES OF NORTHFIELD BANCORP, INC. COMMON STOCK BEING
OFFERED IN THE SUBSCRIPTION AND COMMUNITY OFFERINGS ARE NOT SAVINGS OR DEPOSIT
ACCOUNTS AND ARE NOT INSURED BY THE SAVINGS BANK INSURANCE FUND OF THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY.
<PAGE>
 
                             QUESTIONS AND ANSWERS

                           NORTHFIELD BANCORP, INC.
                       (THE PROPOSED HOLDING COMPANY FOR
                          NORTHFIELD FEDERAL SAVINGS)

Questions and Answers Regarding the Subscription and Community Offerings

                          MUTUAL TO STOCK CONVERSION
                          --------------------------

1.   Q.   WHAT IS A "CONVERSION"?
     A.   Conversion is a change in the legal form of organization. Northfield
          Federal Savings currently operates as a federally-chartered mutual
          savings bank with no stockholders. Through the Conversion, Northfield
          Federal will become a federally-chartered stock savings bank, and the
          stock of its holding company, Northfield Bancorp, Inc. will be held by
          stockholders who purchase stock in the Subscription and Community
          Offerings or in the open market following the Offerings.

2.   Q.   WHY IS NORTHFIELD FEDERAL SAVINGS CONVERTING?
     A.   Northfield Federal, as a mutual savings bank, does not have
          stockholders and has no authority to issue capital stock. By
          converting to the stock form of organization, the Savings Bank will be
          structured in the form used by commercial banks, most business
          entities and a growing number of savings institutions. The Conversion
          will be important to the future growth and performance of Northfield
          Federal by providing a larger capital base from which the Savings Bank
          may operate, the ability to attract and retain qualified management
          through stock-based employee benefit plans, enhanced ability to
          diversify into other financial services related activities and
          expanded ability to render services to the public.

          The Board of Directors and management of Northfield Federal believe
          that the stock form of organization is preferable to the mutual form
          of organization for a financial institution. The Board and management
          recognize the decline in the number of mutual thrifts from over 12,500
          mutual institutions in 1929 to under 800 mutual thrifts today.

          Northfield Federal believes that converting to the stock form of
          organization will allow Northfield Federal to more effectively compete
          with local community banks, 
<PAGE>
 
          thrifts, and with statewide and regional banks, which are in stock
          form. Northfield Federal believes that by combining its existing
          quality service and products with a local ownership base, the Savings
          Bank's customers and community members who become stockholders will be
          inclined to do more business with Northfield Federal.

          Furthermore, because Northfield Federal competes with local and
          regional banks not only for customers, but also for employees,
          Northfield Federal Savings believes that the stock form of
          organization will better afford Northfield Federal the opportunity to
          attract and retain employees, management and directors through various
          stock benefit plans which are not available to mutual savings
          institutions.

3.   Q.   IS NORTHFIELD FEDERAL'S MUTUAL TO STOCK CONVERSION BENEFICIAL TO
          THE COMMUNITIES THAT THE SAVINGS BANK SERVES?
     A.   Management believes that the structure of the Subscription and
          Community Offerings is in the best interest of the communities that
          Northfield Federal serves because following the Conversion it is
          anticipated that a significant portion of the Common Stock will be
          owned by local residents desiring to share in the ownership of a local
          community financial institution. Management desires that a significant
          portion of the shares of common stock sold in the Offerings will be
          sold to residents of the Savings Bank's Local Community (Baltimore
          County, Maryland).

4.   Q.   WHAT EFFECT WILL THE CONVERSION HAVE ON DEPOSIT ACCOUNTS AND LOANS?
     A.   Terms and balances of accounts in Northfield Federal and interest
          rates paid on such accounts will not be affected by the Conversion.
          Insurable accounts will continue to be insured by the Federal Deposit
          Insurance Corporation ("FDIC") up to the maximum amount permitted by
          law. The Conversion also will not affect the terms or conditions of
          any loans to existing borrowers or the rights and obligations of these
          borrowers under their individual contractual arrangements with
          Northfield Federal.

5.   Q.   WILL THE CONVERSION CAUSE ANY CHANGES IN NORTHFIELD FEDERAL'S
          PERSONNEL?
     A.   No. Both before and after the Conversion, Northfield Federal's
          business of accepting deposits, making loans and providing financial
          services will continue without interruption with the same board of
          directors, management and staff.

6.   Q.   WHAT APPROVALS MUST BE RECEIVED BEFORE THE CONVERSION BECOMES
          EFFECTIVE?
     A.   First, the Board of Directors of Northfield Federal must adopt the
          Plan of Conversion, which occurred on _______, 1997. The Plan of
          Conversion was then amended on _______________. Second, the Office of
          Thrift Supervision must approve the applications required to effect
          the Conversion. These approvals have been obtained. Third, the Plan of
          Conversion must be approved by a majority of all votes eligible to be
          cast by Northfield Federal's voting members. A Special Meeting of
          voting members will be held on __________ __, 1998, to consider and
          vote upon the Plan of Conversion.
<PAGE>
 
                              THE HOLDING COMPANY
                              -------------------

7.   Q.   WHAT IS A HOLDING COMPANY?
     A.   A holding company is a Savings Bank that owns another entity.
          Concurrent with the Conversion, Northfield Federal Savings will become
          a subsidiary of Northfield Bancorp, Inc., a holding company organized
          by Northfield Federal to acquire all of the capital stock of
          Northfield Federal Savings to be outstanding after the Conversion.

8.   Q.   IF I DECIDE TO BUY STOCK IN THIS OFFERING, WILL I OWN STOCK IN THE
          HOLDING COMPANY OR NORTHFIELD FEDERAL SAVINGS?
     A.   You will own stock in Northfield Bancorp, Inc. However, Northfield
          Bancorp, Inc., as a holding company, will own all of the outstanding
          capital stock of Northfield Federal Savings.

9.   Q.   WHY DID THE BOARD OF DIRECTORS FORM THE HOLDING COMPANY?
     A.   The Board of Directors believes that the Conversion of Northfield
          Federal Savings and the formation of the Holding Company will result
          in a stronger financial institution with the ability to provide
          additional flexibility to diversify the Savings Bank's business
          activities. The Holding Company will also be able to use stock-based
          incentive programs to attract and retain executive and other
          personnel.

                         ABOUT BECOMING A STOCKHOLDER
                         ----------------------------

10.  Q.   WHAT ARE THE SUBSCRIPTION AND COMMUNITY  OFFERINGS?
     A.   Under the Plan of Conversion adopted by Northfield Federal Savings,
          the Holding Company is offering shares of stock in the Subscription
          Offering, to certain current and former customers of the Savings Bank
          and to the Savings Bank's Employee Stock Ownership Plan ("ESOP").
          Shares which are not subscribed for in the Subscription Offering, if
          any, may be offered to the general public in a Community Offering with
          preference given to natural persons who are permanent residents of the
          Savings Bank's Local Community (Baltimore County). These Offerings are
          consistent with the board's objective of Northfield Bancorp, Inc.
          being a locally owned financial institution. The Subscription Offering
          and Community Offering, if conducted, are being managed by Trident
          Securities, Inc. It is anticipated that any shares not subscribed for
          in either the Subscription or Community Offerings may be offered for
          sale in a Syndicated Community Offering, which is an offering on a
          best efforts basis by a selling group of broker-dealers.
<PAGE>
 
11.  Q.   MUST I PAY A COMMISSION TO BUY STOCK IN CONJUNCTION WITH THE
          SUBSCRIPTION, COMMUNITY OR SYNDICATED COMMUNITY OFFERINGS?
     A.   No.  You will not pay a commission to buy the stock if the stock is
          purchased in the Subscription Offering or  Community Offering, if
          conducted.

12.  Q.   HOW MANY SHARES OF NORTHFIELD BANCORP, INC. STOCK WILL BE ISSUED IN
          THE CONVERSION?
     A.   It is currently expected that between 382,500 shares and 517,500
          shares of common stock will be sold at a price of $10.00 per share.
          Under certain circumstances the number of shares may be increased to
          661,250.

13.  Q.   HOW WAS THE PRICE DETERMINED?
     A.   The aggregate price of the common stock was determined by FinPro,
          Inc., an independent appraisal firm specializing in the thrift
          industry, and was approved by the Office of Thrift Supervision. The
          price is based on the pro forma market value of Northfield Federal
          Savings and the Holding Company as determined by the independent
          evaluation.

14.  Q.   WHO IS ENTITLED TO BUY STOCK IN THE CONVERSION?
     A.   The shares of Northfield Bancorp, Inc. to be issued in the Conversion
          are being offered in the Subscription Offering in the following order
          of priority to: (i) The term "Eligible Account Holders" shall
          hereinafter mean depositors whose accounts in the Savings Bank total
          $50.00 or more as of December 31, 1995, (ii) the Savings Bank's ESOP,
          (iii) depositors with $50.00 or more on deposit at the Savings Bank as
          of March 31, 1998, other than Eligible Account Holders, ("Supplemental
          Eligible Account Holders"), (iv) depositors and borrowers of the
          Savings Bank as of _____________, 1998, other than Eligible Account
          Holders and Supplemental Eligible Account Holders ("Other Members"),
          subject to the priorities and purchase limitations set forth in the
          Plan of Conversion. Subject to the prior rights of holders of
          subscription rights, Common Stock not subscribed for in the
          Subscription Offering may be offered in the Community Offering to
          certain members of the general public, with preference given to
          natural persons and trusts of natural persons residing in the Savings
          Bank's Local Community (Baltimore County). Shares, if any, not
          subscribed for in the Subscription or Community Offerings may be
          offered to the general public in a Syndicated Community Offering.

15.  Q.   ARE THE SUBSCRIPTION RIGHTS TRANSFERABLE?
     A.   NO. SUBSCRIPTION RIGHTS GRANTED TO NORTHFIELD FEDERAL'S ELIGIBLE
          ACCOUNT HOLDERS, SUPPLEMENTAL ELIGIBLE ACCOUNT HOLDERS AND OTHER
          MEMBERS IN THE CONVERSION ARE NOT TRANSFERABLE. PERSONS VIOLATING SUCH
          PROHIBITION, DIRECTLY OR INDIRECTLY, MAY LOSE THEIR RIGHT TO PURCHASE
          STOCK IN THE CONVERSION AND BE SUBJECT TO OTHER POSSIBLE SANCTIONS. IT
          IS THE RESPONSIBILITY OF EACH SUBSCRIBER QUALIFYING AS AN ELIGIBLE
          ACCOUNT HOLDER, SUPPLEMENTAL ELIGIBLE ACCOUNT HOLDER OR OTHER MEMBER
          TO LIST COMPLETELY ALL ACCOUNT NUMBERS FOR QUALIFYING
<PAGE>
 
          SAVINGS ACCOUNTS OR LOANS AS OF THE QUALIFYING DATE ON THE STOCK ORDER
          FORM.

16.  Q.   WHAT ARE THE MINIMUM AND MAXIMUM NUMBERS OF SHARES THAT I CAN PURCHASE
          IN THE CONVERSION?
     A.   The minimum number of shares is 25. The maximum number of shares that
          may be purchased in aggregate in the Conversion by any person or
          person exercising rights through one account other than the ESOP, is
          ______ shares. The maximum purchase for any person or entity, together
          with associates and those acting in concert is _____ shares.

17.  Q.   ARE THE BOARD OF DIRECTORS AND MANAGEMENT OF NORTHFIELD FEDERAL
          SAVINGS BUYING A SIGNIFICANT AMOUNT OF THE STOCK OF THE HOLDING
          COMPANY?
     A.   Directors and executive officers of the Savings Bank are expected to
          subscribe for _____ shares. The purchase price paid by directors and
          executive officers will be the same $10.00 per share price as that
          paid by all other persons who order stock in the Subscription or
          Community Offerings.

18.  Q.   HOW DO I SUBSCRIBE FOR SHARES OF STOCK?
A.   To   subscribe for shares of stock in the Subscription Offering, you should
          send or deliver an original stock order form together with full
          payment (or appropriate instructions for withdrawal from permitted
          deposit accounts as described below) to Northfield Federal Savings in
          the postage-paid envelope provided. The stock order form and payment
          or withdrawal authorization instructions must be received prior to the
          close of the Subscription Offering, which will terminate at 12:00
          p.m., Local Time, on __________ __, 1998, unless extended. Payment for
          shares may be made in cash (if made in person) or by check or money
          order. Subscribers who have deposit accounts with Northfield Federal
          may include instructions on the stock order form requesting withdrawal
          from such deposit account(s) to purchase shares of Northfield Bancorp,
          Inc. Withdrawals from certificates of deposit may be made without
          incurring an early withdrawal penalty.

          If shares remain available for sale after the expiration of the
          Subscription Offering, they may be offered in the Community Offering,
          which may commence at any time after the commencement of the
          Subscription Offering and may terminate at any time without notice,
          but may not terminate later than ______________, 1998. Persons who
          wish to order stock in the Community Offering should return their
          stock order form as soon as possible after the Community Offering
          begins. Members of the general public should contact the Stock
          Information Center at (410)668-2160 for additional information.

19.  Q.   MAY I USE FUNDS IN A RETIREMENT ACCOUNT TO PURCHASE STOCK?
     A.   Yes.  If you are interested in using funds held in your retirement
          account at Northfield Federal Savings, the Stock Information Center
          can assist you in transferring those funds to a self-directed IRA, if
          necessary, and directing the
<PAGE>
 
          trustee to purchase the stock. This process may be done without an
          early withdrawal penalty and generally without a negative tax
          consequence to your retirement account. Due to the additional
          paperwork involved, IRA transfers must be completed by _________. For
          additional information, call the Stock Information Center at (410)
          ________.

20.  Q.   WILL I RECEIVE INTEREST ON FUNDS I SUBMIT FOR A STOCK PURCHASE?
     A.   Yes. Northfield Federal will pay interest at its passbook savings
          account rate from the date the funds are received until completion of
          the stock offering or termination of the Conversion. All funds
          authorized for withdrawal from deposit accounts with Northfield
          Federal will continue to earn interest at the contractual rate until
          the date of the completion of the Conversion.

21.  Q.   MAY I OBTAIN A LOAN FROM NORTHFIELD FEDERAL SAVINGS TO PAY FOR SHARES
          PURCHASED IN THE CONVERSION?
     A.   No. Federal regulations prohibit Northfield Federal Savings from
          making loans for this purpose. However, federal regulations do not
          prohibit you from obtaining a loan from another source for the purpose
          of purchasing stock in the Conversion.

22.  Q.   IF I BUY STOCK IN THE CONVERSION, HOW WOULD I GO ABOUT BUYING
          ADDITIONAL SHARES OR SELLING SHARES IN THE AFTERMARKET?
     A.   Northfield Bancorp, Inc., as a newly organized Savings Bank, has never
          issued capital stock, and consequently there is no established market
          for its Common Stock at this time. Northfield Bancorp, Inc. has
          requested that Trident Securities, Inc. make a market for the Common
          Stock through the OTC Bulletin Board. However, it is unlikely that an
          active trading market for the Common Stock will develop, and there can
          be no assurance that the shares of Common Stock being offered in the
          Conversion can be resold at or above the $10.00 purchase price.

23.  Q.   WHAT IS THE HOLDING COMPANY'S DIVIDEND POLICY?
     A.   The Board of Directors of the Holding company does not initially
          intend to pay regular cash dividends. However, declarations of
          dividends by the board of directors will depend upon a number of
          factors, including: (i) the amount of the net proceeds retained by
          Bancorp in the Conversion, (ii) investment opportunities available,
          (iii) capital requirements, (iv) regulatory limitations, (v) results
          of operations and financial condition, (vi) tax considerations, and
          (vii) general economic conditions. Upon review of such considerations,
          the board may authorize future dividends if it deems such payment
          appropriate and in compliance with applicable law and regulation. No
          assurance can be given, however, that the payment of dividends, once
          commenced, will continue. In addition, from time to time in an effort
          to manage capital at a reasonable level, the board may determine that
          it is prudent to pay special cash dividends. Special cash dividends
          may be paid in addition to, or in lieu of, regular cash dividends.
          There can be no assurance that special dividends will be paid, or, if
          paid, will continue
<PAGE>
 
          to be paid. See "Historical and Pro Forma Capital Compliance," "The
          Conversion--Effects of Conversion to Stock Form on Savers and
          Borrowers of Northfield Federal--Liquidation Account" and 
          "Regulation--Dividend and Other Capital Distribution Limitations."

24.  Q.   WILL THE FDIC INSURE THE SHARES OF THE HOLDING COMPANY?
     A.   No.  The shares of Northfield Bancorp, Inc. are not savings deposits
          or savings accounts and are not insured by the FDIC or any other
          government agency.

25.  Q.   IF I SUBSCRIBE FOR SHARES AND LATER CHANGE MY MIND, WILL I BE ABLE TO
          GET A REFUND OR MODIFY MY ORDER?
     A.   No.  Your order cannot be canceled, withdrawn or modified once it has
          been received by Northfield Federal without the consent of Northfield
          Federal.

                   ABOUT VOTING "FOR" THE PLAN OF CONVERSION
                   -----------------------------------------
 
26.  Q.   AM I ELIGIBLE TO VOTE AT THE SPECIAL MEETING OF MEMBERS TO BE HELD TO
          CONSIDER THE PLAN OF CONVERSION?
     A.   You are eligible to vote at the Special Meeting of Members to be held
          on __________ __, 1998 if you were a depositor or borrower of
          Northfield Federal Savings at the close of business on the Voting
          Record Date (_______, 1998) and continue as such until the Special
          Meeting.  If you were a member on the Voting Record Date, you should
          have received a proxy statement and a proxy card with which to vote.
 
27.  Q.   HOW MANY VOTES DO I HAVE?
     A.   Each account holder is entitled to one vote for each $100, or fraction
          thereof, on deposit in such account(s).  Each borrower member is
          entitled to cast one vote in addition to the number of votes, if any,
          he or she is entitled to cast as an account holder.  No member may
          cast more than 1,000 votes.

28.  Q.   IF I VOTE "AGAINST" THE PLAN OF CONVERSION AND IT IS APPROVED, WILL I
          BE PROHIBITED FROM BUYING STOCK DURING THE SUBSCRIPTION OFFERING?
     A.   No.  Voting against the Plan of Conversion in no way restricts you
          from purchasing Northfield Bancorp, Inc. stock in the Subscription
          Offering.

29.  Q.   DID THE BOARD OF DIRECTORS OF NORTHFIELD FEDERAL SAVINGS UNANIMOUSLY
          ADOPT THE PLAN OF CONVERSION?
     A.   Yes. Northfield Federal's Board of Directors unanimously adopted the
          Plan of Conversion and urges that all members vote "FOR" approval of
          such Plan.

30.  Q.   WHAT HAPPENS IF NORTHFIELD FEDERAL SAVINGS DOES NOT GET ENOUGH VOTES
          TO APPROVE THE PLAN OF CONVERSION?
     A.   The Conversion would not take place, and Northfield Federal would
          remain a mutual savings institution.
<PAGE>
 
31.  Q.   AS A QUALIFYING DEPOSITOR OR BORROWER OF NORTHFIELD FEDERAL SAVINGS,
          AM I REQUIRED TO VOTE?
     A.   No.  However, failure to return your proxy card or otherwise vote will
          have the same effect as a vote AGAINST the Plan of Conversion.

32.  Q.   WHAT IS A PROXY CARD?
     A.   A proxy card gives you the ability to vote without attending the
          Special Meeting in person.  If you received more than one
          informational packet, then you should vote the proxy cards in all
          packets.  Your proxy card(s) is (are) located in the window sleeve of
          your informational packet(s).

          You may attend the meeting and vote, even if you have returned your
          proxy card, if you choose to do so.  However, if you are unable to
          attend, you still are represented by proxy.  Previously executed
          proxies, other than those proxies sent pursuant to the Conversion,
          will not be used to vote for approval of the Plan of Conversion, even
          if the respective members do not execute another proxy or attend the
          Special Meeting and vote in person.

33.  Q.   HOW CAN I GET FURTHER INFORMATION CONCERNING THE STOCK OFFERING?
     A.   You may call the Stock Information Center at (410) ________ for
          further information or to request a copy of the Prospectus, a stock
          order form, a proxy statement or a proxy card.


     THIS INFORMATION DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF
AN OFFER TO BUY NORTHFIELD BANCORP, INC. COMMON STOCK.  SUCH OFFERS AND
SOLICITATIONS MAY BE MADE ONLY BY MEANS OF THE PROSPECTUS.  COPIES OF THE
PROSPECTUS MAY BE OBTAINED BY CALLING THE STOCK INFORMATION CENTER AT (410)____
_____.
     THE SHARES OF NORTHFIELD BANCORP, INC. COMMON STOCK BEING OFFERED ARE NOT
SAVINGS OR DEPOSIT ACCOUNTS AND ARE NOT INSURED BY THE SAVINGS BANK INSURANCE
FUND OF THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT
AGENCY.
<PAGE>
 
           IV.   Individual Letters and Community Meeting Invitations

A.   Explanation

In order to educate the public about the stock offering, Trident suggests
holding community meetings in various locations.  In an effort to target a
group of interested investors, Trident requests that each Director of the
Savings Bank submit a list of acquaintances that he or she would like to invite
to a community meeting.

B.   Method of Distribution of Invitations and Prospect Letters

Each Director submits his list of prospects.  Invitations are sent to each
Director's prospects through the mail.  All invitations are preceded by a
Prospectus and all attendees are given a Prospectus at the meeting.  Letters
will be sent to prospects to thank them for their attendance and to remind them
of closing dates.

C.   Examples enclosed.
<PAGE>
 
                     (Northfield Federal Savings Letterhead)
                                 ____________, 1998

Dear Valued Customer:

    Northfield Federal Savings ("Northfield Federal" or the "Savings Bank") is
pleased to announce that it has received regulatory approval to proceed with its
plan to convert to a federally-chartered stock savings bank.  This stock
conversion is the most significant event in the history of Northfield Federal in
that it allows customers, community members, directors and employees an
opportunity to own stock in Northfield Bancorp, Inc., the proposed holding
company for the Savings Bank.

    For over 61 years, Northfield Federal has successfully operated as a mutual
savings bank.  We want to assure you that the Conversion will not affect the
terms, balances, interest rates or existing FDIC insurance coverage deposits at
the Savings Bank, or the terms or conditions of any loans to existing borrowers
under their individual contract arrangements with the Savings Bank.  Let us also
assure you that the Conversion will not result in any changes in the management,
personnel or the Board of Directors of the Savings Bank.

    As one of our valued members, you have the opportunity to invest in the
Savings Bank's future by purchasing stock in Northfield Bancorp, Inc. during the
Subscription Offering, without paying a sales commission.

    If you decide to exercise your subscription rights to purchase shares, you
must return the properly completed stock order form together with full payment
for the subscribed shares so that it is received by the Savings Bank not later
than 12:00 p.m. Local Time on __________, 1998.

    Enclosed is a proxy card.  Your Board of Directors solicits your vote "FOR"
the Savings Bank's Plan of Conversion.  A vote in favor of the Plan does not
obligate you to purchase stock.  Please sign and return your proxy card
promptly; your vote is important to us.

    We have also enclosed a Prospectus and Proxy Statement which fully describes
Northfield Federal, its management, board and financial strength and the Plan of
Conversion. Please review it carefully before you vote or invest. For your
convenience we have established a Stock Information Center. If you have any
questions, please call the Stock Information Center collect at (410)263-4243.

    We look forward to continuing to provide quality financial services to you
in the future.

                               Sincerely,

                               G. Ronald Jobson
                               President

This does not constitute an offer to sell, or the solicitation of an offer to
buy, shares of Northfield Bancorp, Inc. common stock offered in the conversion,
nor does it constitute the solicitation of a proxy in connection with the
conversion.  Such offers and solicitations of proxies are made only by means of
the Prospectus and Proxy Statement.  There shall be no sale of stock in any
state in which any offer, solicitation of an offer or sale of stock would be
unlawful.

THE STOCK WILL NOT BE INSURED BY THE FDIC OR ANY GOVERNMENTAL AGENCY.
<PAGE>
 
                    (Northfield Federal Savings Letterhead)

                                 ____________, 1998


Dear Interested Investor:

    Northfield Federal Savings ("Northfield Federal" or the "Savings Bank") is
pleased to announce that it has received regulatory approval to proceed with its
plan to convert to a federally-chartered stock savings bank.  This stock
conversion is the most significant event in the history of the Savings Bank in
that it allows customers, community members, directors and employees an
opportunity to own stock in Northfield Bancorp, Inc., the proposed holding
company for the Savings Bank.

    For over 61 years, Northfield Federal has successfully operated as a mutual
savings bank.  We want to assure you that the Conversion will not affect the
terms, balances, interest rates or existing FDIC insurance coverage on the
Savings Bank deposits, or the terms or conditions of any loans to existing
borrowers under their individual contract arrangements with the Savings Bank.

    Let us also assure you that the Conversion will not result in any changes in
the management, personnel or the Board of Directors of the Savings Bank.

    Enclosed is a Prospectus which fully describes Northfield Federal, its
management, board and financial strength.  Please review it carefully before you
make an investment decision.  If you decide to invest, please return to
Northfield Federal a properly completed stock order form together with full
payment for shares at your earliest convenience but not later than 12:00 p.m.
Local Time on _________, 1998.  For your convenience we have established a Stock
Information Center.  If you have any questions, please call the Stock
Information Center collect at (410) ________.

    We look forward to continuing to provide quality financial services to you
in the future.

                               Sincerely,

                               G. Ronald Jobson
                               President

This does not constitute an offer to sell, or the solicitation of an offer to
buy, shares of Northfield Bancorp, Inc. common stock offered in the conversion,
nor does it constitute the solicitation of a proxy in connection with the
conversion.  Such offers and solicitations of proxies are made only by means of
the Prospectus and Proxy Statement.  There shall be no sale of stock in any
state in which any offer, solicitation of an offer or sale of stock would be
unlawful.

THE STOCK WILL NOT BE INSURED BY THE FDIC OR ANY GOVERNMENTAL AGENCY.
<PAGE>
 
                    (Northfield Federal Savings Letterhead)

                              ____________, 1998


Dear Friend:

    Northfield Federal Savings ("Northfield Federal" or the "Savings Bank") is
pleased to announce that it has received regulatory approval to proceed with its
plan to convert to a federally-chartered stock savings bank. This stock
conversion is the most significant event in the history of Northfield Federal in
that it allows customers, community members, directors and employees an
opportunity to own stock in Northfield Bancorp, Inc., the proposed holding
company for the Savings Bank.

    For over 61 years, Northfield Federal has successfully operated as a mutual
savings bank.  We want to assure you that the Conversion will not affect the
terms, balances, interest rates or existing FDIC insurance coverage on the
Savings Bank deposits, or the terms or conditions of any loans to existing
borrowers under their individual contract arrangements with Northfield Federal.

    Let us also assure you that the Conversion will not result in any changes in
the management, personnel or the Board of Directors of Northfield Federal.

    Our records indicate that you were a depositor of Northfield Federal on
December 31, 1995 but that you were not a member on _____________, 1998.
Therefore, under applicable law, you are entitled to subscribe for Common Stock
in Northfield Bancorp, Inc.'s Subscription Offering.  Orders submitted by you
and others in the Subscription Offering are contingent upon the current members'
approval of the Plan of Conversion at a special meeting of members to be held on
_________, 1998 and upon receipt of all required regulatory approvals.

    If you decide to exercise your subscription rights to purchase shares, you
must return the properly completed stock order form together with full payment
for the subscribed shares so that it is received by Northfield Federal not later
than 12:00 p.m. Local Time on _________, 1998.

    Enclosed is a Prospectus which fully describes the Savings Bank, its
management, board and financial strength. Please review it carefully before you
invest. For your convenience we have established a Stock Information Center. If
you have any questions, please call the Stock Information Center collect at
(410)263-4243.

    We look forward to continuing to provide quality financial services to you
in the future.

                               Sincerely,

                               G. Ronald Jobson
                               President

This does not constitute an offer to sell, or the solicitation of an offer to
buy, shares of Northfield Bancorp, Inc. common stock offered in the conversion,
nor does it constitute the solicitation of a proxy in connection with the
conversion.  Such offers and solicitations of proxies are made only by means of
the Prospectus and Proxy Statement.  There shall be no sale of stock in any
state in which any offer, solicitation of an offer or sale of stock would be
unlawful.

THE STOCK WILL NOT BE INSURED BY THE FDIC OR ANY GOVERNMENTAL AGENCY.
<PAGE>
 
                    (Northfield Federal Savings Letterhead)

                               ___________, 1998


Dear Member:

     As a qualified member of Northfield Federal Savings ("Northfield Federal"
or the "Savings Bank"), you have the right to vote upon the Savings Bank's
proposed Plan of Holding Company Conversion and also generally have the right to
subscribe for shares of common stock of Northfield Bancorp, Inc., the proposed
holding company for Northfield Federal through the mutual to stock conversion of
Northfield Federal Savings. However, the proposed plan of Holding Company
Conversion provides that Northfield Bancorp, Inc. will not offer stock in any
state in which compliance with the securities laws would be impracticable for
reasons of cost or otherwise. Unfortunately, the securities laws of your state
would require Northfield Bancorp, Inc. to register its common stock and/or its
employees in order to sell the common stock to you. Such registration would be
prohibitively expensive or otherwise impracticable in light of the few members
residing in your state.

     You may vote on the proposed Plan of Holding Company Conversion and we urge
you to read the enclosed Summary Proxy Statement and execute the enclosed
Revocable Proxy.  Questions regarding the execution of the Revocable Proxy
should be directed to Northfield Federal Savings's Stock Information Center at
(410)263-4243.


                                   Sincerely,


                                   G. Ronald Jobson
                                   President


This does not constitute an offer to sell, or the solicitation of an offer to
buy, shares of Northfield Bancorp, Inc. common stock offered in the conversion,
nor does it constitute the solicitation of a proxy in connection with the
conversion. Such offers and solicitations of proxies are made only by means of
the Prospectus and Proxy Statement. There shall be no sale of stock in any state
in which any offer, solicitation of an offer or sale of stock would be unlawful.

THE STOCK WILL NOT BE INSURED BY THE FDIC OR ANY GOVERNMENTAL AGENCY.
<PAGE>
 
Sent to prospects who are customers*

                             _______________, 1998


&salutation& &firstname& &last name&
&address&
&city&, &state& &zip&

Dear &prefername&

    Recently you may have read in the newspaper that Northfield Federal Savings
(the "Savings Bank") will convert from a federally-chartered mutual savings bank
to a federally-chartered stock savings bank.  This is the most significant event
in the history of Northfield Federal in that it allows customers, employees and
directors the opportunity to share in Northfield Federal Savings's future by
becoming charter stockholders of the Savings Bank's newly-formed holding
company, Northfield Bancorp, Inc.

    As a customer of Northfield Federal, you should have received a packet of
information regarding the conversion, including a Prospectus and a Proxy
Statement.  In addition, we are holding several presentations for friends of the
officers and directors to discuss the stock offering in more detail.  You will
receive an invitation in the near future.

    Please feel free to call me or Northfield Federal's Stock Information
Center at (410) ________ if you have any questions.  I look forward to seeing
you at one of our informational presentations.

                               Sincerely,

                               G. Ronald Jobson
                               President

This does not constitute an offer to sell, or the solicitation of an offer to
buy, shares of Northfield Bancorp, Inc. common stock offered in the conversion,
nor does it constitute the solicitation of a proxy in connection with the
conversion.  Such offers and solicitations of proxies are made only by means of
the Prospectus and the Summary Proxy Statement, respectively.  There shall be no
sale of stock in any state in which any offer, solicitation of an offer or sale
of stock would be unlawful.

THE STOCK WILL NOT BE INSURED BY THE FDIC OR ANY GOVERNMENTAL AGENCY.
<PAGE>
 
*Sent to prospects who are not customers*

                               ____________, 1998



&salutation& &firstname& &lastname&
&address&
&city&, &state&  &zip&

Dear &prefername&:

    Recently you may have read in the newspaper that Northfield Federal Savings
(the "Savings Bank") will be converting from a federally-chartered mutual
savings bank to a federally-chartered stock savings bank.  This is the most
significant event in the history of Northfield Federal in that it allows
customers, employees and directors the opportunity to share in Northfield
Federal's future by becoming charter stockholders of the Savings Bank's holding
company, Northfield Bancorp, Inc.

    [Director] has asked that you be sent a Prospectus and stock order form
which will allow you to become a charter stockholder, should you desire. In
addition, we are holding several presentations for friends of the officers and
directors of Northfield Federal Savings to discuss the stock offering in more
detail. You will receive an invitation in the near future.

    Please feel free to call me or Northfield Federal's Stock Information Center
at (410) 263-4243 if you have any questions.  I look forward to seeing you at
one of our information presentations.

                               Sincerely,

                               G. Ronald Jobson
                               President

This does not constitute an offer to sell, or the solicitation of an offer to
buy, shares of Northfield Bancorp, Inc. common stock offered in the conversion,
nor does it constitute the solicitation of a proxy in connection with the
conversion.  Such offers and solicitations of proxies are made only by means of
the Prospectus and the Summary Proxy Statement, respectively.  There shall be no
sale of stock in any state in which any offer, solicitation of an offer or sale
of stock would be unlawful.

THE STOCK WILL NOT BE INSURED BY THE FDIC OR ANY GOVERNMENTAL AGENCY.
<PAGE>
 
*Sent to those attending a community meeting*

                               ____________, 1998


&salutation& &firstname& &lastname&
&address&
&City&, &state& &zip&


Dear &prefername&:

    Thank you for attending our informational presentation relating to
Northfield Federal Savings 's conversion to a stock savings bank. The
information presented at the meeting and the Prospectus you recently received
should assist you in making an informed investment decision.

    Obviously, we are excited about this stock offering and the opportunity to
share in the future of Northfield Federal.  This conversion is the most
important event in our history and it gives the Savings Bank the strength to
compete in the future and will provide the Savings Bank additional corporate
flexibility.

    We may contact you in the near future to get an indication of your interest
in our offering. If you make a decision to invest, please return your properly
completed stock order form no later than ___________, 1998. If you have any
questions, please call the Stock Information Center at (410)263-4243.

                               Sincerely,

                               G. Ronald Jobson
                               President

This does not constitute an offer to sell, or the solicitation of an offer to
buy, shares of Northfield Bancorp, Inc. common stock offered in the conversion,
nor does it constitute the solicitation of a proxy in connection with the
conversion.  Such offers and solicitations of proxies are made only by means of
the Prospectus and the Summary Proxy Statement, respectively.  There shall be no
sale of stock in any state in which any offer, solicitation of an offer or sale
of stock would be unlawful.

THE STOCK WILL NOT BE INSURED BY THE FDIC OR ANY GOVERNMENTAL AGENCY.
<PAGE>
 
* Sent to those not attending a community meeting *

                                 _________, 1998


&salutation& &firstname& &lastname&
&address&
&city&, &state&  &zip&


Dear &prefername&:

    I am sorry you were unable to attend our recent presentation regarding
Northfield Federal Savings's mutual to stock conversion.  The Board of Directors
and management team of Northfield Federal are committed to contributing to long
term shareholder value and as a group we are personally investing approximately
$385,000 of our own funds.  We are enthusiastic about the stock offering and the
opportunity to share in the future of Northfield Federal Savings.

    We have established a Stock Information Center to assist you with any
questions regarding the stock offering.  Should you require any assistance
between now and ___________, 1998, I encourage you to either stop by our Stock
Information Center or call (410) ________.

    I hope you will join me as a charter stockholder in Northfield Bancorp, Inc.

                                  Sincerely,

                                  G. Ronald Jobson
                                  President


This does not constitute an offer to sell, or the solicitation of an offer to
buy, shares of Northfield Bancorp, Inc. common stock offered in the conversion,
nor does it constitute the solicitation of a proxy in connection with the
conversion.  Such offers and solicitations of proxies are made only by means of
the Prospectus and the Summary Proxy Statement, respectively.  There shall be no
sale of stock in any state in which any offer, solicitation of an offer or sale
of stock would be unlawful.

THE STOCK WILL NOT BE INSURED BY THE FDIC OR ANY GOVERNMENTAL AGENCY.
<PAGE>
 
* Final Reminder Letter *

                                 _________, 1998


&salutation&firstname&lastname&
&address&
&city&, &state&  &zip&

Dear &prefername&:

    I am writing to remind you that the deadline for purchasing stock in
Northfield Bancorp, Inc. is quickly approaching.  I hope you will join me in
becoming a charter stockholder in one of Maryland's newest publicly owned
financial institutions.

    The deadline for becoming a charter stockholder is ____________, 1998. If
you have any questions, please call our Stock Information Center at (410)
________.

    Once again, I look forward to having you join me as a charter stockholder in
Northfield Bancorp, Inc.

                                  Sincerely,

                                  G. Ronald Jobson
                                  President

This does not constitute an offer to sell, or the solicitation of an offer to
buy, shares of Northfield Bancorp, Inc. common stock offered in the conversion,
nor does it constitute the solicitation of a proxy in connection with the
conversion.  Such offers and solicitations of proxies are made only by means of
the Prospectus and the Summary Proxy Statement, respectively.  There shall be no
sale of stock in any state in which any offer, solicitation of an offer or sale
of stock would be unlawful.

THE STOCK WILL NOT BE INSURED BY THE FDIC OR ANY GOVERNMENTAL AGENCY.
<PAGE>
 
================================================================================


                          The Directors and Officers

                                      of

                          Northfield Federal Savings

                    cordially invite you to attend a brief

                 presentation regarding the stock offering of
                                              
            Northfield Bancorp, Inc., our proposed holding company


                             Please join us at the


                                ______________

                             _____________________
                          ___________________________

                                 ____________

                                 ____________

                               for refreshments


YOU MUST RESPOND BY ____________ TO RESERVE A SEAT 
R.S.V.P. (410) ________

===============================================================================
<PAGE>
 
                                V. IRA Mailing


A.   Explanation

     A special IRA mailing is proposed to be sent to all IRA customers of the
     Savings Bank in order to alert the customers that funds held in an IRA can
     be used to purchase stock. Since this transaction is not as simple as
     designating funds from a certificate of deposit like a normal stock
     purchase, this letter informs the customer that this process is slightly
     more detailed and involves a personal visit to the Savings Bank.

B.   Quantity

     One IRA letter is proposed to be mailed to each IRA customer of the Savings
     Bank.  These letters would be mailed following OTS approval for the
     conversion and after each customer has received the initial mailing
     containing a Proxy Statement and a Prospectus.

C.   Example - See following page.
<PAGE>
 
                     (Northfield Federal Savings Letterhead)


                                 __________ __, 1998


Dear Individual Retirement Account Participant:

    As you know, Northfield Federal Savings is in the process of converting from
a federally-chartered mutual savings bank to a federally-chartered stock savings
bank and has formed Northfield Bancorp, Inc. to hold all of the stock of
Northfield Federal Savings (the "Conversion"). Through the Conversion, certain
current and former depositors and borrowers of Northfield Federal have the
opportunity to purchase shares of common stock of Northfield Bancorp, Inc. in a
Subscription Offering. Northfield Bancorp, Inc. currently is offering up to
575,000 shares, subject to adjustment, of Northfield Bancorp, Inc. at a price of
$10.00 per share.

    As the holder of an individual retirement account ("IRA") at Northfield
Federal Savings, you have an opportunity to become a shareholder in Northfield
Bancorp, Inc. using funds being held in your IRA.  If you desire to purchase
shares of common stock of Northfield Bancorp, Inc. through your IRA, Northfield
Federal can assist you in self-directing those funds.  This process can be done
without an early withdrawal penalty and generally without a negative tax
consequence to your retirement account.

    If you are interested in ordering Northfield Bancorp, Inc. common stock
utilizing IRA funds, you must contact our Conversion Center at (410) ______ by
____________.

                                  Sincerely,
   
                                  G. Ronald Jobson
                                  President

This letter is neither an offer to sell nor a solicitation of an offer to buy
Northfield Bancorp, Inc.  common stock.  The offer is made only by the
Prospectus, which was recently mailed to you.

THE SHARES OF NORTHFIELD BANCORP, INC. COMMON STOCK ARE NOT DEPOSITS AND WILL
NOT BE INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
- ---                                                                     
GOVERNMENT AGENCY.
<PAGE>
 
                    VI.   Counter Cards and Lobby Posters


A.   Explanation

     Counter cards and lobby posters serve two purposes:  (1) As a notice to
     Northfield Federal Savings's customers and members of the local community
     that the stock sale is underway and (2) to remind the customers of the end
     of the Subscription Offering. Trident has learned in the past that many
     people forget the deadline for subscribing and therefore we suggest the use
     of these simple reminders.

B.   Quantity

     Approximately 2 - 3 Counter cards will be used at teller windows and on
     customer service representatives' desk.
     Approximately 1 - 2 Lobby posters will be used at Northfield Federal
     Savings's office.

C.   Example

D.   Size

     The counter card will be approximately 8 1/2" x 11".
     The lobby poster will be approximately 16" x 20".
<PAGE>
 
C.

                             POSTER OR COUNTER CARD

===============================================================================

                          "TAKE STOCK IN OUR FUTURE"


                           "NORTHFIELD BANCORP, INC.

                           STOCK OFFERING MATERIALS

                                AVAILABLE HERE"


                          NORTHFIELD FEDERAL SAVINGS

================================================================================
<PAGE>
 
                                 VII.  Proxy Reminder

A.   Explanation

     A proxy reminder is used when the majority of votes needed to adopt the
     Plan of Conversion is still outstanding. The proxy reminder is mailed to
     those "target vote" depositors who have not previously returned their
     signed proxy.

     The target vote depositors are determined by the conversion agent.

B.   Example

C.   Size

     Proxy reminder is approximately 8 1/2" x 11".
<PAGE>
 
B.  Example

________________________________________________________________________________

                          P R O X Y  R E M I N D E R

                          NORTHFIELD FEDERAL SAVINGS



YOUR VOTE ON OUR STOCK CONVERSION PLAN HAS NOT BEEN RECEIVED. YOUR VOTE IS VERY
- ---------                              ---------------------  ----------------- 
IMPORTANT, PARTICULARLY SINCE FAILURE TO VOTE IS EQUIVALENT TO VOTING AGAINST
- ---------- 
THE PLAN.

VOTING FOR THE CONVERSION WILL NOT AFFECT THE INSURANCE OF YOUR ACCOUNTS.
DEPOSIT ACCOUNTS WILL CONTINUE TO BE FEDERALLY INSURED UP TO THE APPLICABLE
LIMITS.

YOU MAY PURCHASE STOCK IF YOU WISH, BUT VOTING DOES NOT OBLIGATE YOU TO BUY
STOCK.

PLEASE ACT PROMPTLY! SIGN THE ENCLOSED PROXY CARD AND MAIL, OR DELIVER, THE
                     ----------------------------                          
PROXY CARD TO NORTHFIELD FEDERAL SAVINGS TODAY.

PLEASE VOTE ALL PROXY CARDS RECEIVED.
            ---                      

WE RECOMMEND THAT YOU VOTE TO APPROVE THE PLAN OF CONVERSION.  THANK YOU.

                                        THE BOARD OF DIRECTORS AND MANAGEMENT OF
                                        NORTHFIELD FEDERAL SAVINGS

________________________________________________________________________________


                       IF YOU RECENTLY MAILED THE PROXY,
             PLEASE ACCEPT OUR THANKS AND DISREGARD THIS REQUEST.
                 FOR FURTHER INFORMATION CALL (410) ________.


This does not constitute an offer to sell, or the solicitation of an offer to
buy, shares of Northfield Bancorp, Inc. common stock offered in the conversion,
nor does it constitute the solicitation of a proxy in connection with the
conversion.  Such offers and solicitations of proxies are made only by means of
the Prospectus and the Summary Proxy Statement, respectively.  There shall be no
sale of stock in any state in which any offer, solicitation of an offer or sale
of stock would be unlawful.

THE STOCK WILL NOT BE INSURED BY THE FDIC OR ANY GOVERNMENTAL AGENCY.

<PAGE>
 
                          CONVERSION VALUATION REPORT
                          ---------------------------

                        Valued as of February 27, 1998


                          NORTHFIELD FEDERAL SAVINGS
                              Baltimore, Maryland


                                 Prepared By:


                              Ferguson & Company
                                   Suite 305
                           860 West Airport Freeway
                              Hurst, Texas  76054
                                 817/577-9558


<PAGE>
 
[FERGUSON & COMPANY LETTERHEAD APPEARS HERE]

                     STATEMENT OF APPRAISER'S INDEPENDENCE
                          NORTHFIELD FEDERAL SAVINGS
                              Baltimore, Maryland
                              -------------------

     We are the appraiser for Northfield Federal Savings ("Northfield" or
"Bank") in connection with its mutual to stock conversion.  We are submitting
our independent estimate of the pro forma market value of the Bank's stock to be
issued in the conversion.  In connection with our appraisal of the Bank's to-be-
issued stock, we have received a fee which was not related to the estimated
final value.  The estimated pro forma market value is solely the opinion of our
company and it was not unduly influenced by the Bank, its conversion counsel,
its selling agent, or any other party connected with the conversion.

     Northfield has agreed to indemnify Ferguson & Company under certain
circumstances against liabilities arising out of our services.  Specifically, we
are indemnified against liabilities arising from our appraisal except to the
extent such liabilities are determined to have arisen because of our negligence
or willful conduct.

                                    Ferguson & Company

                                    /s/ Robin L. Fussell

                                    Robin L. Fussell
                                    Principal

March 6, 1998
<PAGE>
 
[FERGUSON & COMPANY LETTERHEAD APPEARS HERE]

                                 March 6, 1998

Board of Directors
Nothfield Federal Savings
1844 East Joppa Road
Baltimore, Maryland 21234

Dear Directors:

  We have completed and hereby provide, as of February 27, 1998, an independent
appraisal of the estimated pro forma market value of Northfield Federal Savings
("Northfield" or the "Bank"), Baltimore, Maryland, in connection with the
conversion of Northfield from the mutual to stock form of organization
("Conversion").  This appraisal report is furnished pursuant to the regulatory
filing of the Bank's Application for Conversion ("Form AC") with the Office of
Thrift Supervision ("OTS").

  Ferguson & Company ("F&C") is a consulting firm that specializes in providing
financial, economic, and regulatory services to financial institutions.  The
background and experience of F&C is presented in Exhibit I.  We believe that,
except for the fees we will receive for preparing the appraisal, we are
independent.  F&C personnel are prohibited from owning stock in conversion
clients for a period of at least one year after conversion.

  In preparing our appraisal, we have reviewed Northfield's Application for
Approval of Conversion, including the Proxy Statement as filed with the OTS.  We
conducted an analysis of Northfield that included discussions with Anderson
Associates, LLP, the Bank's independent auditors, and with Housley Kantarian &
Bronstein, P.C., the Bank's conversion counsel.  In addition, where appropriate,
we considered information based on other available published sources that we
believe is reliable; however, we cannot guarantee the accuracy or completeness
of such information.

  We also reviewed the economy in Northfield's primary market area and compared
the Bank's financial condition and operating results with that of selected
publicly traded thrift institutions.  We reviewed conditions in the securities
markets in general and in the market for thrifts stocks in particular.

  Our appraisal is based on Northfield's representation that the information
contained in the Form AC and additional evidence furnished to us by the Bank and
its independent auditors are truthful, accurate, and complete.  We did not
independently verify the financial statements and other information provided by
Northfield and its auditors, nor did we independently value the Bank's assets or
liabilities.  The valuation considers Northfield only as a going concern and
should not be considered an indication of its liquidation value.

  It is our opinion that, as of February 27, 1998, the estimated pro forma
market value of Northfield was $4,500,000, or 450,000 shares at $10.00 per
share.  The resultant valuation range was $3,825,000 at the minimum (382,500
shares at $10.00 per share) to $5,175,000 at the maximum (517,500 shares at
$10.00 per share), based on a range of 15 percent below and above the midpoint
valuation.  The supermaximum was $5,951,250 (595,125 shares at $10.00 per
share).
<PAGE>
 
Board of Directors
March 6, 1998
Page 2

  Our valuation is not intended, and must not be construed, as a recommendation
of any kind as to the advisability of purchasing shares of common stock in the
conversion.  Moreover, because such valuation is necessarily based upon
estimates and projections of a number of matters, all of which are subject to
change from time to time, no assurance can be given that persons who purchase
shares of common stock in the conversion will thereafter be able to sell such
shares at prices related to the foregoing estimate of the Bank's pro forma
market value.  F&C is not a seller of securities within the meaning of any
federal or state securities laws and any report prepared by F&C shall not be
used as an offer or solicitation with respect to the purchase or sale of any
securities.

  Our opinion is based on circumstances as of the date hereof, including current
conditions in the United States securities markets.  Events occurring after the
date hereof, including, but not limited to, changes affecting the United States
securities markets and subsequent results of operations of Northfield, could
materially affect the assumptions used in preparing this appraisal.

  The valuation reported herein will be updated as provided in the OTS
conversion regulations and guidelines.  Any updates will consider, among other
things, any developments or changes in Northfield's financial performance and
condition, management policies, and current conditions in the equity markets for
thrift shares.  Should any such new developments or changes be material, in our
opinion, to the valuation of the shares, appropriate adjustments will be made to
the estimated pro forma market value.  The reasons for any such adjustments will
be explained in detail at the time.

                                        Respectfully,
                                        FERGUSON & COMPANY

                                        /s/ Robin L. Fussell

                                        Robin L. Fussell
                                        Principal
<PAGE>
 
                               TABLE OF CONTENTS

                          Northfield Federal Savings

                              Baltimore, Maryland

                                                                           PAGE
                                                                           ----
INTRODUCTION                                                                  1

SECTION I. - FINANCIAL CHARACTERISTICS                                        1

PAST & PROJECTED ECONOMIC CONDITIONS                                          1

FINANCIAL CONDITION OF INSTITUTION                                            2

     Balance Sheet Trends                                                     2

     Asset/Liability Management                                               2

     Income and Expense Trends                                                2

     Regulatory Capital Requirements                                          2

     Lending                                                                  2

     Nonperforming Assets                                                     3

     Classified Assets                                                        3

     Loan Loss Allowance                                                      3

     Mortgage-Backed Securities and Investments                               3

     Savings Deposits                                                         3

     Borrowings                                                               3

     Subsidiaries                                                             3

     Legal Proceedings                                                        4

EARNINGS CAPACITY OF THE INSTITUTION                                          4

     Asset-Size-Efficiency of Asset Utilization                               4

     Intangible Values                                                        4

     Effect of Government Regulations                                         4

     Office Facilities                                                        4

SECTION II - MARKET AREA                                                      1

DEMOGRAPHICS                                                                  1

                                       i


 
<PAGE>
 
FERGUSON & COMPANY
- ------------------

                          TABLE OF CONTENTS - CONTINUED

                           Northfield Federal Savings

                               Baltimore, Maryland


                                                                           PAGE
                                                                           ----
SECTION III - COMPARISON WITH PUBLICLY TRADED THRIFTS                         1

COMPARATIVE DISCUSSION                                                        1

     Selection Criteria                                                       1

     Profitability                                                            2

     Balance Sheet Characteristics                                            2

     Risk Factors                                                             2

     Summary of Financial Comparison                                          2

FUTURE PLANS                                                                  3

SECTION IV - CORRELATION OF MARKET VALUE                                      1

MARKETABILITY & LIQUIDITY OF STOCK TO BE ISSUED                               1

     Financial Aspects                                                        1
                                          
     Market Area                                                              2
                                          
     Management                                                               2
                                          
     Dividends                                                                2
                                          
     Liquidity                                                                3
                                          
     Thrift Equity Market Conditions                                          3

MARYLAND ACQUISITIONS                                                         3

EFFECT OF INTEREST RATES ON THRIFT STOCK                                      4

     Adjustments Conclusion                                                   6
                                  
     Valuation Approach                                                       6
                                  
     Valuation Conclusion                                                     7





                                       ii
<PAGE>
 
FERGUSON & COMPANY
- ------------------


                          TABLE OF CONTENTS - CONTINUED

                           Northfield Federal Savings

                               Baltimore, Maryland




  TABLE
  NUMBER                            TABLE TITLE                            PAGE
  ------                            -----------                            ----

          SECTION I  -  FINANCIAL CHARACTERISTICS

    1     Selected Financial Data                                            5 
    2     Operating Ratios                                                   6 
    3     Interest Rate Shock                                                7 
    4     Regulatory Capital Compliance                                      8 
    5     Loan Portfolio Composition                                         9 
    6     Loan Origination, Purchase, and Repayment Activity                 10
    7     Average Balances, Rates, and Yields                                11
    8     Rate/Volume Analysis                                               12
    9     Non-Performing Assets                                              13
    10    Analysis of the Allowance for Loan Losses                          14
    11    Allocation of Allowance for Loan Losses                            15
    12    Investment Securities                                              16
    13    Investments at December 31, 1997                                   17
    14    Deposit Portfolio                                                  18
    15    Savings Deposits Detail                                            19
    16    Certificate of Deposit Maturities                                  20
    17    Savings Flows                                                      21
    18    Jumbo CD Maturities                                                22
    19    Offices                                                            23

          SECTION II  -  MARKET AREA

    1     Demographic Trends                                                 3 
    2     Percent Employment by Industry                                     4 
    3     Market Area Deposits                                               5 

          SECTION III - COMPARISON WITH PUBLICLY
          TRADED THRIFTS
    1     Comparatives General Characteristics                               4 
    2     Key Financial Indicators                                           5 
    3     Pro Forma Comparisons                                              6 




                                       iii
<PAGE>
 
FERGUSON & COMPANY
- ------------------

                          TABLE OF CONTENTS - CONTINUED

                           Northfield Federal Savings

                               Baltimore, Maryland

  TABLE
  NUMBER                        TABLE TITLE                          PAGE
  ------                        -----------                          ----

                 SECTION IV  - CORRELATION OF MARKET VALUE

    1            Appraisal Earnings Adjustments                        2 
    2            Maryland Acquisitions                                 8 
    3            Recent Conversions                                    10
    4            Recent Pink Sheet Conversions                         13
    5            Comparison of Pricing Ratios                          16

  FIGURE
  NUMBER                           LIST OF FIGURES                   PAGE
  ------                           ---------------                   ----

                 SECTION IV  -  CORRELATION OF MARKET VALUE

    1            SNL Index                                             17
    2            Interest Rates                                        18

                                  EXHIBIT TITLE
                                  -------------

Exhibit I - Ferguson & Company Qualifications 

Exhibit II - Selected Region, State, and Comparatives Information 

Exhibit III - Northfield Federal Savings TAFS Report 

Exhibit IV - Comparative Group TAFS and BankSource Reports 

Exhibit V - Selected Publicly Traded Thrifts 

Exhibit VI - Comparative Group Selection

Exhibit VII - Pro Forma Calculations

           Pro Forma Assumptions
           Pro Forma Effect of Conversion Proceeds At the Minimum of the Range
           Pro Forma Effect of Conversion Proceeds At the Midpoint of the Range
           Pro Forma Effect of Conversion Proceeds At the Maximum of the Range
           Pro Forma Effect of Conversion Proceeds At the SuperMax of the Range
           Pro Forma Analysis Sheet

Exhibit VIII - Reconciliation of Quarterly Reports to Financial Statements


                                       iv
<PAGE>
 
                                   SECTION I

                           FINANCIAL CHARACTERISTICS
<PAGE>
 
FERGUSON & COMPANY                                                    SECTION I
- ------------------                                                    ---------
                                  INTRODUCTION

  Northfield Federal Savings ("Northfield" or "Bank") is a federally chartered,
federally insured mutual savings association located in Baltimore, Maryland.  It
was chartered in 1923 and it joined the Federal Home Loan Bank system and
received federal insurance of accounts in 1985.  In December 1997, it adopted a
plan to convert to a federal stock savings bank, via a standard mutual to stock
conversion.

  At December 31, 1997, Northfield had total assets of $36.1 million, loans of
$30.0 million, mortgage-backed securities of $2.0 million, interest-bearing
deposits in other banks of $3.5 million, deposits of $32.6 million, and net
worth of $2.9 million, or 8.0% of assets.

  The bank has two offices, which are located in Baltimore, Maryland.  Maryland
is in the mid-Atlantic region of the United States.  Baltimore is approximately
50 miles north of Washington, DC.

  Northfield is a traditional thrift with emphasis on lending.  It invests
primarily in (1) 1-4 family loans, (2) construction loans, (3) mortgage backed
securities, and (4) temporary cash investments.  It is funded principally by
savings deposits and existing net worth.  It has utilized borrowings recently,
but had none outstanding at December 31, 1997.

  The Bank offers a full spectrum of real estate loan products to accommodate
its customer base and single family loans dominate the Bank's loan portfolio.
At December 31, 1997, loans on 1-4 family dwellings made up 71.3% of total
assets and 81.4% of the loan portfolio.  Construction loans were 6.7% of the
loan portfolio, commercial real estate loans were 8.9% of the loan portfolio,
and commercial non-real estate loans were 2.3% of the loan portfolio.  Mortgage
backed securities made up 5.4% of total assets.  Interest earning cash made up
9.7% of Northfield's assets at December 31, 1997.

  Northfield had $414,000 in non-performing assets at December 31, 1997, as
compared to $270,000 at December 31, 1996.

  Savings deposits increased $5.5 million during the period from December 31,
1993, to December 31, 1997, a compound annual growth rate of 4.77%.  Savings
decreased $67 thousand (0.23%) from December 31, 1995, to December 31, 1996, and
increased $3.5 million (12.04%) from December 31, 1996, to December 31, 1997.
Northfield has not relied extensively on borrowings during recent years.  It had
$1.75 million in borrowings during September 1997, and none at December 31,
1997.

  The Bank's capital to assets ratio has increased during the period of four
years ending December 31, 1997. Equity capital, as a percentage of assets, has
increased from 7.15% at December 31, 1993, to 8.02% at December 31, 1997.  The
compound annual asset growth rate was 5.17% during the period, while the
compound annual rate of growth for equity was 8.23%.

  Northfield's profitability, as measured by return on average assets ("ROAA"),
has been above its peer group average of thrifts filing TFR's with the OTS,
consisting of OTS supervised thrifts with assets between $25 million and $50
million.  For the years ending December 31, 1994, 1995, 1996, and the nine month
period ending September 30, 1997, Northfield ranked in the 66th, 75th, 70th, and
80th percentile, respectively, in ROAA, based on information derived from the
TAFS thrift database published by Sheshunoff Information Services Inc. (See
Exhibit III, page 2). In return on equity for the same periods, Northfield
ranked in the 85th, 88th, 84th, and 90th percentile, respectively.

                         I.  FINANCIAL CHARACTERISTICS

PAST & PROJECTED ECONOMIC CONDITIONS

  Fluctuations in thrift earnings in recent years have occurred within the time
frames as a result of changing temporary trends in interest rates and other
economic factors.  However, the year-to-year results have been upward while the
general trends in the thrift industry have been improving as interest rates
declined.  Interest rates began a general upward movement during late 1993,
followed by a decline in interest margins and profitability.  Rates began a
general decline in mid 1995 and then leveled off on the short end and increased
on the long end.  Northfield's spread was 2.90% for the year ended December 31,
1996, and 2.88% for the year ended December 31, 1997.
<PAGE>
 
FERGUSON & COMPANY                                                    SECTION I
- ------------------                                                    ---------

  The thrift industry generally is better equipped to cope with changing
interest rates than it was in the past, and investors have recognized the
demonstrated ability of the thrift industry to maintain interest margins in
spite of rising interest rates.  However, rate increases and the shortening of
the time elapsed between increases during 1994 placed pressure on portfolio
managers to shorten maturities, which negatively impacts the future earnings of
financial institutions.  Northfield has a much higher exposure to interest rate
risk than the thrift industry in general.

FINANCIAL CONDITION OF INSTITUTION

BALANCE SHEET TRENDS

  As Table I.1 shows, Northfield experienced healthy growth in assets during the
period of two years months ending December 31, 1997.  Assets increased $3.9
million, or 12.2% during the  period.  Loans increased $8.3 million, or 38.1%.
Mortgage-backed securities, interest-earning cash, and investment securities
combined decreased $4.2 million, or 76.1% during the period.  Savings deposits
increased by $3.4 million, or 11.8%.  Equity increased $294 thousand, or 11.3%.

ASSET/LIABILITY MANAGEMENT

  Managing interest rate risk is a major component of the strategy used in
operating a thrift.  Most of a thrift's interest earning assets are long-term,
while most of the interest bearing liabilities have short to intermediate terms
to contractual maturity.  To compensate, asset/liability management techniques
include (1) making long term loans with interest rates that adjust to market
periodically, (2) investing in assets with shorter terms to maturity, (3)
lengthening the terms to maturities of savings deposits, and (4) seeking to
employ any combination of the aforementioned techniques artificially through the
use of synthetic hedge instruments.  Table I.3 provides rate shock information
at varying levels of interest rate change.  The Bank has significant exposure to
interest rate increases, but its exposure will be reduced through the equity
raised in the conversion.

  Northfield's basic approach to interest rate risk management has been to
emphasize shorter term mortgage loans, and manage its spread by decreasing
liquidity as it increased its investments in loans.  For example, at December
31, 1995, Northfield had 29.9% of its assets invested in passive assets and
67.5% invested in loans.  At December 31, 1997, the Bank had 83.0% of its assets
invested in loans and 15.2% invested in passive investments. Loans generally
earn a higher rate of interest than passive investments.  While this change in
balance sheet structure increased interest rate risk exposure, it helped the
Bank's spread.  Northfield currently is not utilizing synthetic hedge
instruments and has not used borrowings extensively in recent years.
Northfield's business plan calls for a continuation of these strategies.

INCOME AND EXPENSE TRENDS

  Northfield was profitable for the five fiscal years December 31, 1997.
Fluctuations in income over the period have resulted principally from (1)
changes in non-interest expense, principally the SAIF assessment of
approximately $183,000 in 1996 and the directors' deferred compensation cost of
$115,000 in 1997; (2) securities losses of approximately $32,000 in 1997; and
(3) higher than normal additions to the loan loss allowance during the year
ended December 31, 1997.

  Net interest income increased in the year ended December 31, 1997, principally
as a result of growth.

REGULATORY CAPITAL REQUIREMENTS

  As Table I.4 demonstrates, Northfield meets all regulatory capital
requirements, and meets the regulatory definition of a "Well Capitalized"
institution.  Moreover, the additional capital raised in the stock conversion
will add to the existing capital cushion.

LENDING

  Table I.5 provides an analysis of the Bank's loan portfolio by type of loan
and security.  This analysis shows that, from December 31, 1996, through 1997,
Northfield's loan composition has been dominated by 1-4 family dwelling loans.

                                       2
<PAGE>
 
FERGUSON & COMPANY                                                    SECTION I
- ------------------                                                    ---------


  Table I.6 provides information with respect to loan originations and
repayments.  It indicates the years ended December 31, 1997 and 1996, were high
growth years.

  Table I.7 provides rates, yields, and average balances for each of the two
years ended December 31, 1997.  Interest rates earned on interest-earning assets
increased from 7.74% in 1996 to 7.81% for 1997.  Interest rates paid on
interest-bearing liabilities increased from 4.84% in 1996 to 4.93% in 1997.
Northfield's spread decreased from 2.90% in 1996 to 2.88% in 1997.

  Table I.8 provides a rate volume analysis, measuring differences in interest
earning assets and interest costing liabilities and the interest rates thereon
during the years ended December 31, 1997 versus 1996.  The table shows that most
of the increase in net interest income for 1997 resulted from volume changes,
while rate changes substantially offset changes in volumes for 1996.

NON-PERFORMING ASSETS

  As shown in Table I.9, the Bank had $414,000 in loans that were over 90 days
delinquent at December 31, 1997.  The Bank had ceased to accrue interest on
$135,000 of these loans at December 31, 1997.  As shown in Table I.9, Northfield
had $270 thousand in nonperforming assets at December 31, 1996.

CLASSIFIED ASSETS

  Northfield had $135 thousand in classified assets at December 31, 1997, all of
which were classified substandard.  The Bank also had $339 thousand in special
mention.  The Bank had a loan loss allowance of $216,000, or 160.0% of
classified assets at December 31, 1997.

LOAN LOSS ALLOWANCE

  Table I.10 provides an analysis of Northfield's loan loss allowance.  Table
I.11 shows the allocation of the loan loss allowance among the various loan
categories as of December 31, 1996 and 1997.

MORTGAGE-BACKED SECURITIES AND INVESTMENTS

  Table I.12 provides a breakdown of investments as of December 31, 1996 and
1997.  Table I.13 provides maturity information for investments as of December
31, 1997.

SAVINGS DEPOSITS

  At December 31, 1997, Northfield's deposit portfolio was composed as follows:
NOW and DDA accounts--$2.079 million or 6.4%; passbook accounts--$2.605 million
or 8.0%; money market deposit accounts--$7.816 million or 24.0%; and certificate
accounts--$20.108 million or 61.7% (see Table I.14). Table I.15 provides a
comparison of deposits by category for 1996 and 1997. It shows a shift in
composition from transaction to certificate accounts. Table I.16 provides
maturity information for certificates by rate range at December 31, 1997. Table
I.17 provides savings flow information for the years ended December 31, 1996 and
1997. It shows that the Bank experienced a minor decline in deposits for the
year ended December 31, 1996, and experienced a healthy increase in deposits for
the year ended December 31, 1997.

  Northfield is not overly dependent on jumbo certificates of deposit. At
December 31, 1997, the Bank had $1,456 million in certificates that were issued
for $100 thousand or more, or 4.47% of its total deposits (see Table I.18).

BORROWINGS

  Northfield has had minor borrowings in recent years. In September 1997, it had
$1.75 million in borrowings from the Federal Home Loan Bank of Atlanta. However,
at December 31, 1997, it had no outstanding borrowings.

SUBSIDIARIES

  Northfield has no subsidiary.

                                       3
<PAGE>
 
FERGUSON & COMPANY                                                    SECTION I
- ------------------                                                    ---------


LEGAL PROCEEDINGS

  From time to time, Northfield becomes involved in legal proceedings
principally related to the enforcement of its security interest in real estate
loans.  In the opinion of Management of the Bank, no legal proceedings are in
process or pending that would have a material effect on Northfield's financial
position, results of operations, or liquidity.

EARNINGS CAPACITY OF THE INSTITUTION

  As in any interest sensitive industry, the future earnings capacity of
Northfield will be affected by the interest rate environment.  Historically, the
thrift industry has performed at less profitable levels in periods of rising
interest rates.  This performance is due principally to the general composition
of the assets and the limited repricing opportunities afforded even the
adjustable rate loans.  The converse earnings situation (falling rates) does not
afford the same degree of profitability potential for thrifts due to the
tendency of borrowers to refinance both high rate fixed rate loans and
adjustable loans as rates decline.

  Northfield is no exception to the aforementioned phenomenon.  With its current
asset and liability structure, however, its exposure to rising interest rates is
significant.

  The addition of capital through the conversion will allow Northfield to grow.
As growth is attained, the leverage of that new capital should, from a ratio of
expenses to total assets standpoint, reduce the operating expense ratio.
However, growth and additional leverage will likely be moderate and well
controlled to maintain the current risk levels inherent in the Bank's asset
base.

ASSET-SIZE-EFFICIENCY OF ASSET UTILIZATION

  At its current size and in its current asset configuration, Northfield is a
moderately efficient operation. With total assets of approximately $36.1
million, Northfield has eight full time equivalent employees.

INTANGIBLE VALUES

  Northfield's greatest intangible value lies in its loyal deposit base.
Northfield has a 75 year history of sound operations, controlled growth, and
consistent earnings.  At June 30, 1996, the Bank had 3.46% of the deposit market
in its area (up from 3.39% at June 30, 1994), and it has the ability to increase
market share.  Northfield's deposits grew $3.354 million (11.46%) from June 30,
1996, to December 31, 1997.

  Northfield has no significant intangible values that could be attributed to
unrecognized asset gains on investments and real estate.

EFFECT OF GOVERNMENT REGULATIONS

  Northfield's business plan calls for little change in its strategies.
Government regulations will have the greatest impact in the area of cost of
compliance and reporting.  The conversion will create an additional layer of
regulations and reporting and thereby increase the cost to the Bank.

OFFICE FACILITIES

  Northfield's main office is located in leased space in a strip shopping
center.  It has limited drive-up and no ATM services.  Its branch building is an
owned facility with limited space.  Table I.19 provides information on
Northfield's offices.  The facilities are adequate for the convenience and needs
of the Bank's customer base. However, executive officers and staff members do
not have adequate working space.  The Bank is in the process of leasing
temporary executive offices for a period of approximately two years, at the end
of which time it is anticipated that the Bank will construct a new home office.

                                       4
<PAGE>

FERGUSON & COMPANY                                                    Section I 
- ------------------                                                    ---------

<TABLE> 
<CAPTION> 
                                             Table I.1 - Selected Financial Data                                                    
                                                                                At December 31                              Compound
                                                      ---------------------------------------------------------------        Growth 
                                                         1997          1996          1995          1994          1993         Rate
                                                         ----          ----          ----          ----          ----      ---------
                                                                               ($000's)
<S>                                                   <C>           <C>           <C>           <C>           <C>          <C> 
Selected Financial Condition Data:
Total assets                                          $36,084       $32,228       $32,151       $30,336       $29,492          5.17%
Cash                                                      117           173           187           137           190            NM
Interest bearing deposits                               3,514         5,186         7,284         5,747         7,710       -21.70%
Securities available for sale                            --             197           191           166           173            NM
Securities held to maturity                              --            --            --             212           294            NM
Mortgage backed securities                              1,955         2,333         2,154         2,348         2,106            NM
Loans receivable, net                                  29,961        23,841        21,695        21,162        18,462         12.87%
Federal Home Loan Bank stock                              226           226           226           226           224            NM
Savings deposits                                       32,622        29,116        29,183        27,652        27,079          4.77%
Equity--substantially restricted                        2,894         2,749         2,600         2,319         2,109          8.23%
</TABLE> 

<TABLE> 
<CAPTION> 
                                                                Year Ended December 31,
                                       -------------------------------------------------------------------
                                             1997          1996          1995          1994         1993
                                             ----          ----          ----          ----         ----
                                                                       ($000's)                   
<S>                                        <C>           <C>           <C>          <C>           <C> 
Selected Operations Data:                                                                      
- ------------------------
Interest income                            $ 2,626       $ 2,457       $ 2,419      $ 2,189       $ 2,315
Interest expense                             1,493         1,397         1,354        1,095         1,142
                                       -------------------------------------------------------------------
                Net interest income          1,133         1,060         1,065        1,094         1,173
Provision for loan losses                      123            10            10            6             9
                                       -------------------------------------------------------------------
          Net interest income after                                                            
          provision for loan losses          1,010         1,050         1,055        1,088         1,164
                                       -------------------------------------------------------------------
Noninterest income (expense)                    (2)           31            19          (51)           33
                                       -------------------------------------------------------------------
                          Sub-total          1,008         1,081         1,074        1,037         1,197
                                       -------------------------------------------------------------------
Noninterest expense:                                                                           
  Compensation and benefits                    470           328           324          323           276
  Other                                        302           515           330          341           312
                                       -------------------------------------------------------------------
  Total noninterest expense                    772           843           654          664           588
                                       -------------------------------------------------------------------
                Income before taxes            236           238           420          373           609
Income tax expense                              91            89           158          149           235
                                       -------------------------------------------------------------------
                          Sub total            145           149           262          224           374
Cumulative effect of change                      -             -             -            -            15
                                       ===================================================================
                         Net income          $ 145         $ 149         $ 262        $ 224         $ 359
                                       ===================================================================
</TABLE> 


Source: Offering Circular

                                       5
<PAGE>
 
FERGUSON & COMPANY        Table I.2 - Operating Ratios              Section I
- ------------------                                                  ---------

<TABLE> 
<CAPTION> 
                                                          At or for the      
                                                      Year Ended December 31,
                                                    -------------------------
                                                          1997        1996   
                                                          ----        ----   
<S>                                                 <C>           <C>        
Performance Ratios:                                                          
- ------------------
Return on assets (ratio of net earnings                                      
  to average total assets)                               0.43%       0.46%   
Return on equity (ratio of  net earnings                                     
  to average equity)                                     4.99%       5.50%   
Ratio of average interest-earning assets to                                  
  average interest-bearing liabilities                 111.11%     109.99%   
Ratio of net interest income, after provision                                
  for loan losses, to noninterest expense              130.83%     124.56%   
Net interest rate spread                                 2.88%       2.90%   
Net yield on average interest-earning assets             3.37%       3.34%   
                                                                             
Quality Ratios:                                                              
- --------------
Non-performing loans to total loans                                          
  at end of period                                       1.31%       1.07%   
Non-performing loans to total assets                     1.15%       0.84%   
Non-performing assets to total assets                                        
  at end of period                                       1.15%       0.84%   
Allowance for loan losses to non-performing                                  
  loans at end of period                                52.17%      37.04%   
Allowance for loan losses to total loans, net            0.72%       0.42%   
                                                                             
Capital Ratios:                                                              
- --------------
Equity to total assets at end of period                  8.02%       8.47%   
Average equity to average assets                         8.52%       8.39%   
                                                                             
Other Data:                                                                  
- ----------
Number of full service offices                              2           2     
</TABLE> 



Source: Offering circular            6
<PAGE>
 
FERGUSON & COMPANY                                                  Section I
- ------------------                                                  ---------

                        Table I.3 - Interest Rate Shock

<TABLE> 
<CAPTION> 
                                           Net Portfolio Value
                                            December 31, 1997
                        --------------------------------------------------------
                                          Estimated
                                           NPV as a
        Change           Estimated          Percent
       in Rates             NPV           of Assets     $ Change      % Change
- ----------------------  -------------  ------------     --------     -----------
                                                        ($000's)
<S>                     <C>            <C>              <C>          <C> 
+400 bp                        $ 152           0.47%     (3,519)           -96%
+300 bp                          990           2.95%     (2,681)           -73%
+200 bp                        1,892           5.44%     (1,779)           -48%
+100 bp                        2,823           7.85%       (848)           -23%
       0 bp                    3,671           9.89%          -              -
 --100 bp                      4,188          11.05%        517             14%
 --200 bp                      4,286          11.18%        615             17%
 --300 bp                      4,397          11.34%        726             20%
 --400 bp                      4,657          11.83%        986             27%
</TABLE> 

Source:  Office of Thrift Supervision, Risk Management Division



                                       7
<PAGE>
 
FERGUSON & COMPANY                                                   Section I
- ------------------                                                   ---------

                   Table I.4 - Regulatory Capital Compliance


                                                      Percent of
                                             Amount     Assets
                                            ---------------------
                                                  ($000's)
Tangible capital                              $ 2,894       8.0%    
Tangible capital requirement                      541       1.5%
                                            --------------------
Excess (deficit)                               $2,353       6.5%
                                            ====================
                                                        
Core capital                                   $2,894       8.0%
Core capital requirement                        1,083       3.0%
                                            --------------------
Excess (deficit)                               $1,811       5.0%
                                            ====================
                                                        
Risk-based capital                             $3,109      17.2%
Risk-based capital requirement                  1,447       8.0%
                                            --------------------
Excess (deficit)                               $1,662       9.2%
                                            ====================


Source: Offering circular

                                       8
<PAGE>
 
FERGUSON & COMPANY      Table I.5 - Loan Portfolio Composition       Section I
- ------------------                                                   ---------

<TABLE> 
<CAPTION> 
                                                                At December 31,
                                           ----------------------------------------------------------
                                                          1997                        1996
                                           ----------------------------  ----------------------------
                                                Amount      Percent           Amount      Percent
                                                ------      -------           ------      -------
                                                                     ($000's)
<S>                                             <C>         <C>               <C>         <C>       
Mortgage Loans:
  1-4 family                                     25,740          81.35%        19,439          77.18%
  Commercial real estate loans                    2,805           8.86%         2,195           8.71%
  Construction loans                              2,105           6.65%         2,462           9.77%
                                           ----------------------------  ----------------------------
        Total mortgage loans                     30,650          96.86%        24,096          95.66%
                                           ----------------------------  ----------------------------

Consumer loans:
  Home equity line of credit loans                  177           0.56%             -           0.00%
  Loans on savings accounts                          74           0.23%            74           0.29%
                                           ----------------------------  ----------------------------
                                                    251           0.79%            74           0.29%
                                           ----------------------------  ----------------------------
Commercial loans-secured by leases                  741           2.34%         1,018           4.04%
                                           ----------------------------  ----------------------------
 Total loans                                     31,642         100.00%        25,188         100.00%
                                           -------------===============  -------------===============


Less:
  Undisbursed loans in process                    1,197                         1,028
  Deferred fees and discounts                       268                           219
  Allowance for losses                              216                           100
                                           -------------                 -------------
Loan portfolio, net                              29,961                        23,841
                                           =============                 =============
</TABLE> 




Source: Offering circular               9
<PAGE>
 
FERGUSON & COMPANY                                              Section I
- ------------------                                              ---------
        
        Table I.6 - Loan Origination, Purchase, and Repayment Activity


                                            For the Year Ended June 30,
                                     ------------------------------------------
                                                   1997                1996
                                                   -----               ----
                                                         ($000's)
                                     
Net loans, beginning of period                 $ 23,841            $ 21,695
                                     
Originations by type:                
- ---------------------
Mortgage loans:                      
    1-4 family                                    9,621               6,366
    Commercial                                      439                 142
Consumer loans                                      505                   -
Loans on savings accounts                            50                   8
Commercial loans                                    340                 207
                                     -------------------  ------------------
     Total loans originated                      10,955               6,723
                                     -------------------  ------------------
                                     
Loans purchased                                     350                   -
- ---------------                      -------------------  ------------------
                                     
Repayments:                                       4,843               4,329
- -----------                          -------------------  ------------------
                                     
Decrease (increase) in other 
  items, net:                                      (342)               (248)
- ----------------------------         -------------------  ------------------

   Net increase (decrease) in loans 
     receivable, net                              6,120               2,146
                                     -------------------  ------------------

 Net loans, end of period                      $ 29,961            $ 23,841
                                     ===================  ==================


Source: Offering circular
                                      10
<PAGE>
 
<TABLE> 
<CAPTION> 
                                                                               Year Ended December 31,
                                              --------------------------------------------------------------------------------------
                                                 1997                                        1996
                                              ----------------------------------------  ------------------------------------------
                                                  Average     Interest                        Average     Interest
                                                Outstanding    Earned/       Average        Outstanding    Earned/       Average
                                                 Balance       Paid       Yield/Rate         Balance       Paid       Yield/Rate
                                              ----------------------------------------  ------------------------------------------
                                                                                  ($000's)
<S>                                           <C>              <C>        <C>              <C>          <C>           <C> 
Interest/dividend-earning assets:
- ---------------------------------
Loans                                              $ 27,282     $ 2,209           8.10%    $ 23,157     $ 1,928           8.33%
Mortgage backed securities                            2,167         166           7.66%       2,057         162           7.88%
Other (1)                                             4,186         251           6.00%       6,542         367           5.61%
                                              ----------------------------------------------------------------------------------
Total interest\dividend-earning assets               33,635     $ 2,626           7.81%      31,756     $ 2,457           7.74%
                                                            ============================            ============================
Non-interest earning assets                             433                                     527
                                              --------------                            ------------
Total assets                                       $ 34,068                                $ 32,283
                                              ==============                            ============
Interest-bearing liabilities:
- -----------------------------
Savings deposits                                   $ 29,854       1,474           4.94%    $ 28,796     $ 1,394           4.84%
Borrowings                                              419          19           4.53%          77           3           3.90%
                                              ----------------------------------------- ----------------------------------------
Total interest-bearing liabilities                   30,273     $ 1,493           4.93%      28,873     $ 1,397           4.84%
                                                            ============================            ============================
Non-interest bearing liabilities                        891                                     702
                                              --------------                            ------------
Total liabilities                                    31,164                                  29,575
                                              --------------                            ------------
Equity                                                2,904                                   2,708
                                              --------------                            ------------
Total liabilities and equity                       $ 34,068                                $ 32,283
                                              ==============                            ============

Net interest\dividend income                                    $ 1,133                                 $ 1,060
                                                            ============                            =============
Net interest\dividend rate spread  (2)                                            2.88%                                   2.90%
                                                                        ================                            ============
Net interest\dividend earnings assets               $ 3,362                                 $ 2,883
                                              ==============                            ============
Net interest\dividend margin  (3)                                                 3.37%                                   3.34%
                                                                        ================                            ============
Average interest\dividend-earning assets to
 average interest-bearing liabilities                            111.11%                                 109.99%
                                                            ============                            =============
</TABLE> 
(1) Includes mutual funds, interest bearing deposits, and FHLB stock.
(2) Net interest rate spread represents the difference between the average
     yield on interest-earning assets and the average rate on interest-bearing
     liabilities.
(3) Net interest margin represents net interest income divided by average
     interest-earning assets.

Source: Offering circular
                                      11
<PAGE>
 
FERGUSON & COMPANY      Table I.8 - Rate/Volume Analysis              Section I
- ------------------                                                    ---------
<TABLE> 
<CAPTION> 

                                                                           Year Ended December 31,
                                      ----------------------------------------------------------------------------------------------
                                                    1997 vs. 1996                                     1996 vs. 1995
                                      --------------------------------------------  ------------------------------------------------
                                                          Increase                                          Increase
                                                        (Decrease)                                        (Decrease)
                                                            Due to          Total                             Due to       Total
                                      ------------------------------                ----------------------------------
                                                              Rate/      Increase                               Rate/     Increase
                                      Volume       Rate     Volume     (Decrease)       Volume       Rate     Volume     (Decrease)
                                      ------       ----     ------     ----------       ------       ----     ------     ----------
                                                                                ($000's)
<S>                                   <C>          <C>      <C>       <C>               <C>          <C>      <C>        <C> 
Interest-earning assets:
Loans                                   $ 341      $ (51)      $ (9)        $ 281         $ 127      $ (63)      $ (4)        $ 60
Investments available for sale              1          -         (1)            -             -          -          -            -
Mortgage-backed securities                  9         (4)         -             5           (15)        (2)         -          (17)
Interest bearing deposits                (129)        20         (8)         (117)            1         (6)         -           (5)
                                      --------------------------------------------  -----------------------------------------------

     Total interest-earning assets        222        (35)       (18)          169           113        (71)        (4)          38
                                      --------------------------------------------  -----------------------------------------------

Interest-bearing liabilities:
Deposits                                   49         29          1            79            49         (5)         -           44
Borrowings                                 17          -          -            17            (1)         -          -           (1)
                                      --------------------------------------------  -----------------------------------------------

    Total interest - bearing liabilities   66         29          1            96            48         (5)         -           43
                                      --------------------------------------------  -----------------------------------------------

    Increase (decrease) in
       net interest income              $ 156      $ (64)     $ (19)         $ 73          $ 65      $ (66)      $ (4)        $ (5)
                                      ============================================  ===============================================
</TABLE> 

Source: Offering circular
                                      12
<PAGE>
 
                          Table I.9 - Non-Performing Assets

The table below sets forth the amounts and categories of non-performing assets.
Loans are placed on non-accrual status when the collection of principal or
interest becomes doubtful.
<TABLE> 
<CAPTION> 
                                                                    December 31,
                                                           ----------------------------
                                                                1997              1996
                                                                -----             ----
                                                                 ($000's)
<S>                                                        <C>               <C> 
Non-accruing loans:
Real estate:
  One- to four-family                                      $       -         $       -
  Multi-family                                                     -                 -
  Commercial                                                       -                 -
  Construction                                                     -                 -
Consumer                                                           -                 -
Commercial                                                       135               270
                                                           ----------------------------
     Total                                                       135               270
                                                           ----------------------------

Accruing loans delinquent 90 days or more:
Real estate:
  One- to four-family                                              -                 -
  Multi-family                                                     -                 -
  Commercial                                                       -                 -
  Construction                                                     -                 -
Consumer                                                           -                 -
Commercial                                                       279                 -
                                                           ----------------------------
     Total                                                       279                 -
                                                           ----------------------------
                Total non-performing loans                       414               270
                                                           ----------------------------

Repossessed assets                                                 -                 -
                                                           ----------------------------

Total non-performing assets                                      414               270
                                                           ============================

Total non-performing loans as a
  percentage of total net loans                                 1.38%             1.13%
                                                           ============================

Total non-performing assets as a
  percentage of total assets                                    1.15%             0.84%
                                                           ============================
</TABLE> 

Source: Offering circular & F&C calculations

                                      13
<PAGE>
 
FERGUSON & COMPANY                                                     Section I
- ------------------                                                     ---------

                Table I.10 - Analysis of the Allowance for Loan Losses

                                                    Year ended June 30,
                                                 ---------------------------
                                                        1997           1996
                                                        -----          ----
                                                            ($000's)

Balance at beginning of period                         $ 100           $ 90
                                                 ------------  -------------

Charge-offs:
One- to four-family                                        -              -
Multi-family                                               -              -
Commercial real estate                                     -              -
Construction                                               -              -
Consumer                                                   -              -
Commercial non-real estate                                 7              -
                                                 ------------  -------------
                                                           7              -
                                                 ------------  -------------

Recoveries:                                                -              -
                                                 ------------  -------------

Net (charge-offs)                                          7              -
                                                 ------------  -------------
Additions charged to operations                          123             10
                                                 ============  =============
Balance at end of period                               $ 216          $ 100
                                                 ============  =============

Allowance for loan losses to total
  non-performing loans at end of period                52.17%         37.04%
                                                 ============  =============

Allowance for loan losses to net
  loans at end of period                                0.72%          0.42%
                                                 ============  =============

Source: Offering circular
                                      14
<PAGE>
 
FERGUSON & COMPANY                                                     Section I
- ------------------                                                     ---------

                        Table I.11 - Allocation of Allowance for Loan Losses
<TABLE> 
<CAPTION> 

                                                                  At December 31,
                                                -----------------------------------------------------
                                                   1997                        1996
                                                -------------------------   -------------------------
                                                              Percent                     Percent
                                                              of Loans                    of Loans
                                                              in Each                     in Each
                                                 Amount of    Category       Amount of    Category
                                                 Loan Loss    to Gross       Loan Loss    to Gross
                                                 Allowance     Loans         Allowance     Loans
                                                 ---------     -----         ---------     -----
                                                                      ($000's)
<S>                                              <C>          <C>            <C>          <C> 
Mortgage Loans
   1-4 family                                          $ 96        81.3%        $ 45           77.20%
   Commercial                                            60         8.9%           -            8.70%
   Construction                                           -         6.7%           -            9.80%
Consumer Loans                                            -         0.8%           -            0.30%
Commercial Loans                                         60         2.3%          55            4.00%
                                                -------------------------   -------------------------

                                                        216       100.0%       $ 100          100.0%
                                                =========================   =========================
</TABLE>

Source: Offering circular
                                      15
<PAGE>
 
FERGUSON & COMPANY                                                     Section I
- ------------------                                                     ---------

                       Table I.12 - Investment Securities

                                                             At December 31,
                                                    ----------------------------
                                                        1997           1996
                                                    -------------  -------------
                                                                    ($000's)

Available for sale:
  Lord Abbett U.S. government securities
    mutual fund                                              $ -          $ 197

Held to maturity:
  Interest-bearing deposits in other banks                 3,514          5,186
  Mortgage-backed securities                               1,955          2,333
  Federal Home Loan Bank stock                               226            226
                                                    -------------  -------------

                                            Total        $ 5,695        $ 7,745
                                                    =============  =============


Source: Offering circular
                                      16
<PAGE>
 
FERGUSON & COMPANY                                                     Section I
- ------------------                                                     ---------

<TABLE> 
<CAPTION> 
                                        Table I.13 - Investments at December 31, 1997

                                                Maturity Period at December 31, 1997
                               ------------------------------------------------------------------------  ---------------------------
                                 One Year or Less         One to Five Years        Over Five Years                     Total
                               ----------------------   --------------------  -------------------------  ---------------------------

                                Carrying                Carrying               Carrying              Carrying                Market
                                 Value       Yield        Value     Yield       Value     Yield       Value       Yield      Value
                                 -----       -----        -----     -----       -----     -----       -----       -----      -----
                                                                        ($000's)
<S>                             <C>          <C>        <C>         <C>        <C>        <C>       <C>          <C>      <C> 
Securities held to maturity:
- -------------------------------
Interest-bearing deposits         $ 3,257      6.03%     $ 158      7.51%       $ 99       5.50%    $ 3,514      6.08%    $ 3,514
Mortgage-backed securities            120      5.48%        60      7.98%      1,775       7.94%      1,955      7.79%      2,011
FHLB stock                             -                     -                   226       7.25%        226      7.25%        226
                                                                                                                        
                               ----------- --------- ---------- --------- ----------- ---------- ----------- ---------  ----------
Total investment securities       $ 3,377      6.01%     $ 218      7.64%    $ 2,100       7.75%    $ 5,695      6.71%    $ 5,751
                               =========== ========= ========== ========= =========== ========== =========== =========  ==========
</TABLE> 

Source: Offering circular
                                      17
<PAGE>
 
FERGUSON & COMPANY                                                     Section I
- ------------------                                                     ---------

                         Table I.14 - Deposit Portfolio
<TABLE> 
<CAPTION> 
                                                                             Balance          Percent
                                                            Interest        December 31,        of
Category                                     Term           Rate (1)          1997           Deposits
- --------                                     ----           --------          -----          --------
                                                                            ($000's)
<S>                                          <C>            <C>             <C>              <C> 
Savings and transactions accounts
- ---------------------------------
Passbook accounts                                 None               3.23%         2,605               8.0%
Demand and NOW accounts                           None               2.53%         2,079               6.4%
Money market accounts                             None               4.12%         7,816              24.0%
                                                                            -------------     -------------
                                                                                  12,500              38.3%
                                                                            -------------     -------------
Certificates of deposit
- --------------------------------------
Fixed term, fixed rate                               6 months        5.34%         1,954               6.0%
Fixed term, fixed rate                              12 months        5.43%         2,394               7.3%
Fixed term, fixed rate                              18 months        5.45%           446               1.4%
Fixed term, fixed rate                              30 months        5.75%           196               0.6%
Fixed term, fixed rate                              36 months        5.92%           447               1.4%
Fixed term, fixed rate                              48 months        6.46%           147               0.5%
Fixed term, fixed rate                              60 months        6.63%         1,590               4.9%
Fixed term, fixed rate                              72 months        6.97%         4,418              13.5%
Other                                                                6.17%         8,516              26.1%
                                                             -------------  -------------     -------------
        Total certificates of deposit                                6.19%        20,108              61.7%
                                                             -------------  -------------     -------------

               Total savings deposits                                4.24%      $ 32,608             100.0%
                                                             =============  =============     =============
</TABLE> 
(1) Indicates weighted average interest rate at December 31, 1997.


Source: Offering circular
                                      18
<PAGE>
 
FERGUSON & COMPANY                                                     Section I
- ------------------                                                     ---------

                      Table I.15 - Savings Deposits Detail
<TABLE> 
<CAPTION> 
                                                             At December 31,
                                      --------------------------------------------------------------
                                                    1997                            1996
                                      ------------------------------  ------------------------------
                                                       Percent of                      Percent of
                                          Amount         Total            Amount         Total
                                          ------          -----           ------         -----
                                                                ($000's)
<S>                                   <C>              <C>                <C>          <C> 
Transactions and Savings Deposits:
- ----------------------------------
  Demand and NOW accounts                     $ 2,079             6.37%       $ 2,124             7.29%
  Money market accounts                         7,816            23.96%         7,974            27.39%
  Passbook accounts                             2,605             7.99%         2,627             9.02%
                                      ---------------------------------  ------------------------------

Total transaction accounts                     12,500            38.32%        12,725            43.70%
                                      ---------------------------------  ------------------------------

Certificates:
  Jumbo                                         1,456             4.46%         2,281             7.83%
  Other                                        18,652            57.18%        14,097            48.42%
                                      ---------------------------------  ------------------------------

Total certificates                             20,108            61.64%        16,378            56.25%
                                      ---------------------------------  ------------------------------

Accrued interest                                   14             0.04%            13             0.04%
                                      ---------------------------------  ------------------------------

Total deposits plus accrued interest         $ 32,622           100.00%      $ 29,116           100.00%
                                      =================================  ==============================
</TABLE> 

Source: Offering circular
                                      19
<PAGE>
 
FERGUSON & COMPANY                                                     Section I
- ------------------                                                     ---------

                  Table I.16 - Certificates of Deposit Maturities

The table below provides CD maturities at December 31, 1997, by year in rate
ranges.

                                      4.00 -      6.00 -            Percent
                                      5.99%       7.99%   Total     of Total
                                      -----       -----   -----     --------
                                                ($000's)
Certificates maturing in:

One year                        $ 7,075       $ 688     $ 7,763           38.61%
One to two years                  2,461       3,321       5,782           28.75%
Two to three years                  454       3,061       3,515           17.48%
Over three years                  1,006       2,042       3,048           15.16%
                             ---------------------------------------------------

            Total              $ 10,996     $ 9,112    $ 20,108          100.00%
                             ===================================================

       Percent of total          54.68%      45.32%     100.00%
                             ======================================

Source: Offering circular
                                      20
<PAGE>
 
FERGUSON & COMPANY                                                     Section I
- ------------------                                                     ---------

                           Table I.17 - Savings Flows

The following table sets forth the savings flows for the periods indicated.

                                                 Year Ended June 30,
                                      ------------------------------------------
                                                    1997                 1996
                                                    -----                ----
                                                       ($000's)

Opening balance                                 $ 29,103             $ 29,162
Net increase (decrease)
  before interest credited                         2,027               (1,464)
Interest credited                                  1,477                1,405
                                      -------------------   ------------------

Ending Balance                                  $ 32,607             $ 29,103
                                      ===================   ==================

Net increase (decrease)                          $ 3,504                $ (59)
                                      ===================   ==================

Percent increase (decrease)                       12.04%               -0.20%
                                      ===================   ==================

Source: Offering circular
                                      21
<PAGE>
 
FERGUSON & COMPANY                                                     Section I
- ------------------                                                     ---------

                              Table I.18 - Jumbo CD Maturities

Jumbo certificates of deposit
  maturing in period ending:                                           Amount
- ------------------------------------------                 -------------------
                                                                        ($000's)

Within three months or less                                             $ 100
Three through six months                                                    -
Six through twelve months                                                   -
Over 12 months                                                          1,356
                                                           -------------------

Total                                                                 $ 1,456
                                                           ===================

Source: Offering circular
                                      22
<PAGE>
 
FERGUSON & COMPANY                                                     Section I
- ------------------                                                     ---------

                              Table I.19 - Offices


                              Net Book       Year      Owned or        Square
Physical address              Value (1)    Occupied     Leased        Footage
- ----------------              ---------    --------     ------        -------
                              ($000's)
Main office:
1844 East Joppa Road              $ -        1982        Leased        3,150
Baltimore, MD  21234

Branch office:
8705 Harford Road                 $23        1963         Owned          750
Baltimore, MD  21234



(1) Cost less accumulated depreciation and amortization.

Source: Offering circular
                                      23
<PAGE>
 
                                  SECTION II
                                  MARKET AREA
<PAGE>
 
FERGUSON & COMPANY                                                    Section II
- ------------------                                                    ----------

                               II.  MARKET AREA

DEMOGRAPHICS

  Northfield Federal Savings ("Northfield" or "Bank") conducts its operations
through two offices located in Baltimore, Maryland.  Maryland is in the mid-
Atlantic region of the United States.  Baltimore is 50 miles north of
Washington, DC.

  Northfield has determined that its principal trade area is the zip code in
which its offices are located--21234.  Table II.1 presents historical and
projected trends for the United States, Maryland, Baltimore MSA, and zip code
21234, which includes the Bank's home office and branch.  The information
addresses population, income, employment, and housing trends.

  As indicated in Table II.1, population growth rates for Baltimore MSA and zip
code 21234 are below both the United States rate and the rate for the State of
Maryland, which is level with that of the United States.  Household income
growth for zip code 21234 is projected to be well below that of the State of
Maryland and the Baltimore MSA, but well above that of the United States for the
period 1996 to 2001.

  In the period from 1990 until 1996, the population of the State of Maryland
grew 6.40%.  During the same period, the Baltimore MSA population increased
4.28%, and the United States population increased 6.67%.  The population of zip
code 21234 increased 1.93% from 1990 to 1996.  Projections of population growth
from 1996 through 2001 indicate that the State of Maryland will increase 5.33%,
while Baltimore MSA is projected to increase by 4.32% and the United States
population is projected to increase by 5.09%. The population of zip code 21234
is projected to increase 2.01% from 1996 to 2001.

  Household income is projected to increase by 4.93% for Baltimore MSA from 1996
to 2001.  For the same period, household income is projected to increase by
4.49% for the State of Maryland and decline by 3.88% for the United States.  Per
capita and household income levels for the State of Maryland are higher than
those of the United States, and per capita and household income levels for
Baltimore MSA and zip code 21234 are below the State of Maryland but above that
of the United States.

  The 2001 estimate shows that, for Baltimore MSA, households with incomes less
than $15,000 are expected to be 14%; those with incomes between $15,000 and
$25,000 are estimated at 12%; those with incomes between $25,000 and $50,000 are
estimated at 33%; those with incomes between $50,000 and $100,000 are estimated
at 33%; and households with incomes in excess of $100,000 are projected to be
10%.  The 2001 estimates for Maryland are 12%, 11%, 33%, 35%, and 11%,
respectively.  The 2001 estimate for zip code 21234 is 11%, 13%, 40%, 32%, and
5%, respectively.

  The number of households in Baltimore MSA is projected to increase by 4.23%
from 1996 to 2001, below the projection for the State of Maryland which calls
for an increase of 5.26% and below the projected growth rate for the United
States at 5.14%.

  With projections of a increase in population and number of households,
combined with projections of a growing household income, the market for housing
units will be ample.  Zip code 21234 has approximately 27,700 housing units, of
which 62.42% are owner occupied, and a vacancy rate of 3.23%.

  The principal sources of employment in Baltimore County are services--30.0%;
trade--27.0%; and public administration--15.0%.

  Analysis of the data presented above presents a picture of ample economic
opportunity, suggesting that Northfield has sufficient growth opportunities
within its current market area.

  Based on information publicly available on deposits as of June 30, 1996 (see
Table II.3), zip code 21234 had $845.1 million in deposits and Northfield had
3.46% of the deposit market, up from 3.39% of the market at June 30, 1994.
Northfield's recent deposit growth rate has been good.  Northfield's competition
consists of 15 commercial

                                       1
<PAGE>
 
FERGUSON & COMPANY                                                    Section II
- ------------------                                                    ----------

bank offices, 6 thrift offices, and 1 credit union office. Table II.3 shows that
from June 30, 1994 to 1996, Northfield's deposits increased by $1.662 million
(6.0%) while the overall market increased $30.274 million in deposits (3.7%).
Northfield's business plan projects that its deposits will grow at approximately
5% annually during the three year Plan, before an estimated withdrawal of
approximately $1.5 million of deposits for stock purchases.

  Building permit information was not available by zip code.  However, projected
population and income growth rates in Northfield's zip code portend adequate
building.  Northfield has significant competition from other financial
institutions for the residential loan opportunities.

  Growth opportunities for Northfield can be assessed by reviewing economic
factors in its market area.  The salient factors include growth trends, economic
trends, and competition from other financial institutions.  We have reviewed
these factors to assess the potential for the market area.  In assessing the
growth potential of Northfield, we must also assess the willingness and
flexibility of management to respond to the competitive factors that exist in
the market area.  Our analysis of the economic potential and the potential of
management affects the valuation of the Bank.  Management has demonstrated its
flexibility through its long term planning on facilities and its restructuring
of the Bank's balance sheet in recent years to emphasize lending and de-
emphasize passive investments.

                                       2
<PAGE>
 

FERGUSON & COMPANY                                                    Section II
- ------------------                                                    ----------


                        Table II.1 - Demographic Trends

                            Key Economic Indicators
         United States, Maryland, Baltimore MSA (0720), Zip Code 21234

<TABLE> 
<CAPTION> 


   ==============================================================================================================================
                                                                United                                 MSA             Zip Code
                   Key Economic Indicator                       States            Maryland       Baltimore - 0720        21234
   ------------------------------------------------------------------------------------------------------------------------------

   <S>                                                        <C>                 <C>            <C>                   <C> 
   Total Population, 2001 Est.                                278,802,003         5,358,628             2,591,459          69,125
     1996 - 2001 Percent Change, Est.                                5.09              5.33                  4.32            2.01
   Total Population, 1996 Est.                                265,294,885         5,087,442             2,484,101          67,760
     1990 - 96 Percent Change, Est.                                  6.67              6.40                  4.28            1.93
   Total Population, 1990                                     248,709,873         4,781,468             2,382,172          66,477
   ------------------------------------------------------------------------------------------------------------------------------

   Household Income, 2001 Est.                                     33,189            47,915                45,324          40,796
     1996 - 2001 Percent Change, Est.                               (3.88)             4.49                  4.93            0.78
   Household Income, 1996 Est.                                     34,530            45,857                43,194          40,481

   ------------------------------------------------------------------------------------------------------------------------------
   Per Capita Income, 1990                                         16,738            21,037                19,991          18,810
   ------------------------------------------------------------------------------------------------------------------------------

   Household Income Distribution-2001 Est. (%)
     $15,000 and less                                                  20                12                    14              11
     $15,000 - $25,000                                                 16                11                    12              13
     $25,000 - $50,000                                                 34                32                    33              40
     $50,000 - $100,000                                                24                35                    33              32
     $100,000 - $150,000                                                4                 8                     7               4
     $150,000 and over                                                  2                 3                     3               1
   ------------------------------------------------------------------------------------------------------------------------------
   ------------------------------------------------------------------------------------------------------------------------------
   Unemployment rate, 1990                                           6.24              4.23                  4.82            3.70
   ------------------------------------------------------------------------------------------------------------------------------

   Median Age of Population, 1996 Est.                               34.3              34.6                  35.0            36.3
   Median Age of Population, 1990                                    32.9              33.0                  33.4            34.6
   ------------------------------------------------------------------------------------------------------------------------------
   ------------------------------------------------------------------------------------------------------------------------------
   Average Housing Value, 1990                                     79,098           142,451               123,885          97,220
   ------------------------------------------------------------------------------------------------------------------------------

   Total Households, 2001 Est.                                103,293,062         1,956,215               955,690          27,836
     1996 - 2001 Percent Change, Est.                                5.14              5.29                  4.23            1.90
   Total Households, 1996                                      98,239,161         1,858,013               916,918          27,316
     1990 - 96 Percent Change, Est.                                  6.84              6.23                  4.18            1.70
   Total Households, 1990                                      91,947,410         1,748,991               880,145          26,859
   ------------------------------------------------------------------------------------------------------------------------------

   Total Housing Units, 1990                                  101,641,260         1,891,917               928,076          27,743
     % Vacant                                                       10.07              7.55                  5.16            3.23
     % Occupied                                                     89.93             92.45                 94.84           96.77
        % By Owner                                                  57.78             60.11                 60.38           62.42
        % By Renter                                                 32.15             32.33                 34.45           34.35
   ==============================================================================================================================
</TABLE> 

   Source:  Scan/US, Inc.


                                       3

<PAGE>
 

FERGUSON & COMPANY                                                    Section II
- ------------------                                                    ----------


                  Table II.2 - Percent Employment by Industry



                                           United                 Baltimore
                Industry                   States     Maryland      County
=======================================   ========  ===========  ===========

  Construction/Agriculture/Mining              9.5          7.0          6.0

  Manufacturing                               17.7          8.0          1.0

  Transportation/Utilities                     7.1          5.0          5.0

  Trade                                       21.2         25.0         27.0

  Finance/Insurance                            6.9          6.0          6.0

  Services                                    32.7         30.0         30.0

  Public Administration                        4.8         19.0         15.0

Source:  State of Maryland ESC.


                                       4
<PAGE>
 
FERGUSON & COMPANY                                                    Section II
- ------------------                                                    ----------
                                 Table II.3 - Market Area Deposits

<TABLE> 
<CAPTION> 
- --------------------------------------------------------------------------------------------------------

                                                1996                 1995                1994
                                           ----------------    -----------------   -----------------
                                                                  (in Thousands)
<S>                                        <C>                 <C>                 <C> 
Zip Code 21234 Deposits

Total Northfield Federal Savings                  $ 29,268             $ 28,073            $ 27,606
                                           ----------------    -----------------   -----------------
       Number of Branches                                2                    2                   2

Other Thrifts (1)                                  210,676              206,134             246,085
                                           ----------------    -----------------   -----------------
       Number                                            6                    6                   7
       Number of branches                                6                    6                   7

Total Thrifts                                      239,944              234,207             273,691
                                           ----------------    -----------------   -----------------
       Number                                            7                    7                   8
       Number of branches                                8                    8                   9

Total Bank Deposits                              $ 603,748            $ 590,420           $ 539,745
                                           ----------------    -----------------   -----------------
       Number                                            7                    7                   7
       Number of Branches                               15                   15                  13

Total Credit Union Deposits                        $ 1,359              $ 1,256             $ 1,341
                                           ----------------    -----------------   -----------------
       Number                                            1                    1                   1
       Number of Branches                                1                    1                   1

       Total Deposits                            $ 845,051            $ 825,883           $ 814,777
                                           ================    =================   =================

               Percent of Deposits Held by
                     Northfield Federal               3.46%                3.40%               3.39%
                                           ================    =================   =================

- --------------------------------------------------------------------------------------------------------
</TABLE> 

Source:  BranchSource, a product of Sheshunoff Information Services, Inc.

       (1) Between June 30, 1994 and 1995, First Union Bank (bank) acquired a
       branch from Household Bank (thrift). That office had $46.596 million in
       deposits at June 30, 1994. This accounts for most of the $39.5 million
       decrease in thrift deposits and $50.7 million increase in bank deposits
       between 1994 and 1995.

                                       5
<PAGE>
 
                                  SECTION III

                           COMPARISON WITH PUBLICLY

                                TRADED THRIFTS
<PAGE>
 
FERGUSON & COMPANY                                                   Section III
- ------------------                                                   -----------

                 III.  COMPARISON WITH PUBLICLY TRADED THRIFTS

COMPARATIVE DISCUSSION

  This section presents an analysis of Northfield Federal Savings ("Northfield"
or "Bank") relative to a group of 10 publicly traded thrift institutions
("comparative group").  Such analysis is necessary to determine the adjustments
that must be made to the pro forma market value of Northfield's stock.  Table
III.1 presents a listing of the comparative group with general information about
the group.  Table III.2 presents key financial indicators relative to
profitability, balance sheet composition and strength, and risk factors.  Table
III.3 presents a pro forma comparison of Northfield to the comparative group.
Exhibits III and IV contain selected financial information on Northfield and the
comparative group.  This information is derived from quarterly TFR's filed with
the OTS and call reports filed with the FDIC.  The selection criteria and
comparison with the comparative group are discussed below.

Selection Criteria

  Ideally, the comparative group would consist of thrifts in the same geographic
region with identical local economies, asset size, capital level, earnings
performance, asset quality, etc.  However, there are few comparably sized
institutions with stock that is liquid enough to provide timely, meaningful
market values. Therefore, we have selected a group of comparatives that are
either listed on the New York Stock Exchange ("NYSE"), the American Stock
Exchange ("AMEX"), or Nasdaq.  We excluded companies that are apparent takeover
targets and companies with unusual characteristics that tend to distort both
mean and median calculations.  For example, we have excluded all companies with
losses during the trailing twelve months.  We have also excluded mutual holding
companies (see Exhibit VI).

  Because of the limited number of similar size thrifts with sufficient trading
volume, we looked for members of the comparative group among thrifts with assets
up to $100 million.  The Mid-Atlantic Region, which includes Maryland, had four
thrifts that met the size requirements.  We found 49 thrifts that met the asset
size requirements in the entire country (we consider 10 to be the minimum
number), and we retained 10 and eliminated 39 for the following reasons: (a) One
was a mutual holding company; (b) Two did not have PE ratios for the last
quarter and six had PE ratios over 35 for the last quarter; (c) Fourteen had
tangible equity under 10% or over 25% of assets; (d) Three had agreed to be
acquired; (e) Seven had non-performing assets in excess of 1.5% of assets; (f)
Four had loans under 50% of assets; and (g) Seven had loans serviced in excess
of 20% of assets.  After eliminating the thrifts described above, there were 17
left.  We then eliminated those with over $85 million in assets and reduced the
comparative group to 10.

  The principal source of data was SNL Securities, Charlottesville, Virginia.
There are approximately 400 publicly traded thrifts listed on NYSE, AMEX, or
Nasdaq.  In developing statistics for the entire country, we eliminated certain
institutions that skewed the results, in order to make the data more meaningful:

  .  We eliminated companies with losses,
  .  We eliminated indicated acquisition targets,
  .  We eliminated companies with price/earnings ratios in excess of 35, and
  .  We eliminated companies that had not reported as a stock institution for
one complete year.

The resulting group of 268 publicly traded thrifts is included in Exhibit V.

  The selected group of comparatives has sufficient trading volume to provide
meaningful price data. Two of the comparative group members are located in the
Mid-Atlantic and the others are located in the Midwest (7) and Southeast (1)
Regions.  With total assets of approximately $36.1 million, Northfield is well
below the group selected, which has average assets of $60.2 million and median
assets of $62.2 million. 

                                       1
<PAGE>
 
FERGUSON & COMPANY                                                   Section III
- ------------------                                                   -----------

Northfield's assets after conversion will continue to be much smaller than the
comparative group. Pro forma assets at the midpoint are $39.7 million.

PROFITABILITY

  Using the comparison of profitability components as a percentage of average
assets, Northfield was below the comparative group in net income, 0.84% to
1.03%; net interest income, 3.33% to 3.82%; loss provisions, 0.36% to 0.04%;
noninterest income, 0.09% to 0.25%; and core income, 0.84% to 0.96%.  Northfield
was above the comparative group in operating expense, 1.93% to 2.46%, and
efficiency ratio. 58.07% to 61.24%.  Northfield's operating expense minus other
income was 1.84% versus 2.21% for the comparative group.  After conversion,
deployment of the proceeds will provide additional income, and Northfield will
compare more favorably with the comparative group in terms of return on average
assets, with a return of 0.98% at the midpoint of the appraisal range.  Pro
forma return on average equity is 5.78% at the midpoint, versus a mean of 4.99%
and median of 5.21% for the comparative group.

  As compared with the comparative group, Northfield has a more desirable
operating expense ratio and efficiency ratio.  Northfield is below the
comparative group in all other areas of operations shown on Table III.2.
Northfield has two impediments to earnings relative to the comparative group--1)
its net interest income as a percentage of assets; and 2) its ratio of interest
earning assets to interest bearing liabilities.  The proceeds from the stock
sale will eliminate these two impediments.  However, it will take some time and
asset growth to leverage the capital.

Balance Sheet Charateristics

  The general asset composition of Northfield is similar to that of the
comparative group. Northfield has a lower level of passive investments with
16.11% of its assets invested in cash, investments, and mortgage-backed
securities, versus 26.48% for the comparative group.  Northfield has a higher
percentage of its assets in loans, at 83.03% versus 71.22% for the comparative
group.  Northfield's percentage of earning assets to interest costing
liabilities is much lower than that of the group.  Northfield has 110.32% and
the comparative group averages 120.32%.  After conversion, Northfield's ratio
will be level with that of the group of comparatives (121% at the midpoint).

  The liability side differs mainly in that Northfield has a lower percentage of
borrowings, a higher percentage of deposits, and a lower percentage of equity.
Northfield has no borrowings versus 7.47% of assets for the comparative group
and deposits equal to 90.41% of assets versus 74.10% for the comparative group.
Northfield's equity is 8.02% of assets versus 17.19% for the comparative group.
Northfield's equity ratio after conversion will be level with that of the
comparative group.  Northfield's pro forma equity ratio at the midpoint is 16.3%
(18.9% at the supermaximum).

Risk Factors

     Northfield has a much higher level of non-performing assets than the
comparative group, at 1.15% of assets versus 0.38% for the comparative group.
However, Northfield's loss experience is nominal.  Northfield's loan loss
allowance is 0.728% of net loans, which is in line with the comparative group at
0.63%.  Its rate shock table indicates a 48% decline in net portfolio value at a
200 basis point increase in rates and a 96% decline in net portfolio value at a
400 basis point rate increase (see Table I.3).  The comparative group
information indicates a negative 9.48% one year gap to assets.  However, only 2
of the 10 members of the group reported their gap.  Overall, we believe that
Northfield's interest rate risk position is much more exposed than that of the
comparative group.

Summary of Financial Comparison

  Based on the above discussion of operational, balance sheet, and risk
characteristics of Northfield compared with the group, we believe that
Northfield's performance is slightly below that of the comparative 

                                       2
<PAGE>
 
FERGUSON & COMPANY                                                   Section III
- ------------------                                                   -----------

group, with the major shortcoming being excessive interest rate risk. The
conversion proceeds will improve several of Northfield's financial aspects, but,
after conversion, the Bank will continue to lag the comparative group in some
financial areas. Expansion of the earnings base is needed to leverage the
capital to achieve a reasonable return on equity.

FUTURE PLANS

  Northfield's future plans are to be a well capitalized profitable institution
with good asset quality and a commitment to serving the needs of its trade area.
The business plan projects that the Bank will experience moderate growth,
leveraging the capital slowly.

  In recent years, Northfield has experienced moderate growth (5.17% compound
annual growth in assets over the four year period from December 31, 1993, to
1997).  The Bank's business plan projects that it will experience growth in
loans, savings deposits, and liquidity.  The additional capital raised by the
sale of Common Stock will initially be used to purchase short term investment
securities.

  Increasing market penetration by increasing the number of services and
products available, improving physical facilities, and branching are the most
likely methods of expanding Northfield's asset base.

                                       3
<PAGE>
 
FERGUSON & COMPANY                                                   Section III
- ------------------                                                   -----------
              Table III.1 - Comparatives General Characteristics

<TABLE> 
<CAPTION> 

                                                                                          Total                  Current     Current
                                                                              Number      Assets                   Stock      Market
                                                                    Type         of       ($000)                  Price       Value
Ticker     Short Name                    City          State      Thrift (1)  Offices      MRQ         IPO Date    ($)        ($M)
<S>          <C>                        <C>            <C>        <C>         <C>       <C>           <C>         <C>         <C> 
CKFB       CKF Bancorp Inc.              Danville        KY         Trad.         1      62,865        01/04/95    19.500      16.91
HBBI       Home Building Bancorp         Washington      IN         Trad.         2      42,430        02/08/95    22.625       7.05
HCFC       Home City Financial Corp.     Springfield     OH         Trad.         1      70,110        12/30/96    18.625      16.85
LONF       London Financial Corp.        London          OH         Trad.         1      37,916        04/01/96    14.875       7.59
MIVI       Mississippi View Holding Co   Little Falls    MN         Trad.         1      68,619        03/24/95    18.375      13.60
NSLB       NS&L Bancorp Inc.             Neosho          MO         Trad.         2      59,817        06/08/95    17.375      12.26
PWBK       Pennwood Bancorp Inc.         Pittsburgh      PA         Trad.         3      47,211        07/15/96    22.000      12.11
SOBI       Sobieski Bancorp Inc.         South Bend      IN         Trad.         3      87,553        03/31/95    20.500      16.07
SSB        Scotland Bancorp Inc.         Laurinburg      NC         Trad.         2      61,473        04/01/96    10.125      19.38
USAB       USABancshares, Inc.           Philadelphia    PA         Trad.         1      64,269        NA          10.500       7.69
                                                         
Maximum                                                                           3      87,553                    22.625      19.38
Minimum                                                                           1      37,916                    10.125       7.05
Average                                                                           2      60,226                    17.450      12.95
Median                                                                            2      62,169                    18.500      12.93
</TABLE> 
                                                       
              (1) Determined type thrift by reference to TAFS, which is derived
              from quarterly reports filed with the OTS, and BankSource, which
              is derived from quarterly reports filed with the FDIC. TAFS and
              BankSource are published by Sheshunoff.

Source: SNL & F&C calculations

                                       4
<PAGE>
 
FERGUSON & COMPANY      Table III.2 - Key Financial Indicators       Section III
- ------------------                                                   -----------

<TABLE> 
<CAPTION> 
                                             Northfield
                                              Federal               Comparative
                                              Savings                  Group
                                          ----------------           ----------
<S>                                             <C>                 <C> 
Profitability
  (% of average assets)
Net income (1)                                     0.84                 1.03
Net interest income                                3.33                 3.82
Loss (recovery)  provisions                        0.36                 0.04
Other operating income (2)                         0.09                 0.25
Operating expense (3)                              1.93                 2.46
Efficiency ratio (3)                              58.07                61.24
Core income ( excluding gains
   and losses on asset sales) (1)                  0.84                 0.96


Balance Sheet Factors
   (% of assets)
Cash and investments                              10.69                19.94
Mortgage-backed securities (including CMO's)       5.42                 6.54
Loans                                             83.03                71.22
Savings deposits                                  90.41                74.10
Borrowings                                         -                    7.47
Equity                                             8.02                17.21
Tangible equity                                    8.02                17.19


Risk Factors
   (%)
Earning assets/costing liabilities               110.32               120.32
Non-performing assets/assets                       1.15                 0.38
Loss allowance/non performing assets              52.17               141.24
Loss allowance/loans                               0.72                 0.63
One year gap/assets (4)                           NA                   (9.48)
</TABLE> 

(1) Used appraisal earnings.
(2) Excludes $32,000 in securities losses.
(3) Excludes $115,000 charge for deferred compensation. 
(4) Only 2 of the 10 in the group reported one year gap.

Source:  SNL Securities,  F&C calculations,
and Offering Circular

                                       5
<PAGE>
 
FERGUSON & COMPANY       Table III.3 - Pro Forma Comparisons         Section III
- ------------------                                                   -----------

                          Northfield Federal Savings

<TABLE> 
<CAPTION> 

As of February 27, 1998

Ticker    Name                                 Price      Mk Value     PE      P/Book    P/TBook    P/Assets   Div Yld    Assets
                                                ($)        ($Mil)      (X)      (%)        (%)         (%)       (%)      ($000)
<S>      <C>                                  <C>        <C>         <C>      <C>       <C>        <C>        <C>        <C> 
          Northfield Federal
          ------------------
          Before Conversion                       N/A        N/A       N/A       N/A        N/A        N/A        N/A     36,084
          Pro Forma Supermaximum               10.000       5.95      14.9      77.0       77.0       14.5       2.00     40,919
          Pro Forma Maximum                    10.000       5.18      13.5      73.3       73.3       12.9       2.00     40,251
          Pro Forma Midpoint                   10.000       4.50      12.2      69.5       69.5       11.3       2.00     39,669
          Pro Forma Minimum                    10.000       3.83      10.8      64.9       64.9        9.8       2.00     39,088

          Comparative Group
          -----------------
          Averages                             17.450      12.95      24.3     123.9      124.2       21.5       1.72     60,226
          Medians                              18.500      12.93      20.8     119.0      119.0       20.3       1.69     62,169

          Maryland Thrifts
          ----------------
          Averages                             20.675      50.79      27.5     178.3      178.3       21.5       1.49    242,580
          Medians                              21.625      38.46      29.2     170.6      170.6       17.4       1.73    264,904

          Mid-Atlantic Region Thrifts
          ---------------------------
          Averages                             26.909     318.09      22.2     176.3      191.8       18.1       1.59  1,818,282
          Medians                              24.500      82.87      21.3     161.7      170.6       16.1       1.49    493,406

          All Public Thrifts
          ------------------
          Averages                             25.861     293.65      21.3     173.6      181.7       19.1       1.68  1,765,084
          Medians                              22.250      65.62      20.6     159.7      165.7       17.8       1.63    357,691

          Comparative Group
          -----------------
CKFB      CKFBancorp-KY                        19.500      16.91      20.1     113.8      113.8       26.9       2.56     62,865
HBBI      HomeBldngBncp-IN                     22.625       7.05      20.8     109.8      109.8       16.6       1.33     42,430
HCFC      HomeCityFinl-OH                      18.625      16.85      NA       122.5      122.5       24.0       1.93     70,110
LONF      LondonFinlCorp-OH                    14.875       7.59      18.6     145.4      145.4       20.0       1.61     37,916
MIVI      MissViewHldgCo-MN                    18.375      13.60      19.6     109.1      109.1       19.8       1.74     68,619
NSLB      NS&LBancorp-MO                       17.375      12.26      27.2     104.6      105.4       20.7       2.88     59,817
PWBK      PennwoodBancorp-PA                   22.000      12.11      25.6     131.3      131.3       25.7       1.64     47,211
SOBI      SobieskiBancorp-IN                   20.500      16.07      31.1     115.5      115.5       17.9       1.56     87,553
SSB       ScotlandBancorp-NC                   10.125      19.38      15.6     131.0      131.0       31.5       1.98     61,473
USAB      USABancshares-PA                     10.500       7.69      40.4     156.0      158.4       12.0       -        64,269
</TABLE> 

                                       6
<PAGE>
 
FERGUSON & COMPANY      Table III.3 - Pro Forma Comparisons          Section III
- ------------------                                                   -----------

                          Northfield Federal Savings

<TABLE> 
<CAPTION> 

As of February 27, 1998

Ticker    Name                                     Eq/A      TEq/A      EPS       ROAA      ROAE
                                                    (%)       (%)       ($)       (%)       (%)
<S>      <C>                                     <C>        <C>       <C>        <C>       <C> 
          Northfield Federal
          ------------------
          Before Conversion                         8.0       8.0        N/A      0.84      9.88
          Pro Forma Supermaximum                   18.9      18.9       0.67      1.02      5.22
          Pro Forma Maximum                        17.5      17.5       0.74      1.00      5.49
          Pro Forma Midpoint                       16.3      16.3       0.82      0.98      5.78
          Pro Forma Minimum                        15.1      15.1       0.93      0.96      6.11

          Comparative Group
          -----------------
          Averages                                 17.2      17.2       0.76      0.96      4.99
          Medians                                  18.1      18.1       0.80      0.98      5.21

          Maryland Thrifts
          ----------------
          Averages                                 12.5      12.5       0.85      0.79      7.49
          Medians                                  12.5      12.5       0.66      0.74      6.25

          Mid-Atlantic Region Thrifts
          ---------------------------
          Averages                                 10.8      10.3       1.29      0.88      8.91
          Medians                                   9.4       8.9       1.09      0.81      8.46

          All Public Thrifts
          ------------------
          Averages                                 11.9      11.7       1.31      0.99      9.37
          Medians                                  10.1       9.9       1.12      0.94      8.28

          Comparative Group
          -----------------
CKFB      CKFBancorp-KY                            21.9      21.9       0.97      1.37      5.84
HBBI      HomeBldngBncp-IN                         14.1      14.1       1.09      0.72      5.48
HCFC      HomeCityFinl-OH                          19.6      19.6      NA        NA        NA
LONF      LondonFinlCorp-OH                        13.8      13.8       0.80      1.00      5.21
MIVI      MissViewHldgCo-MN                        18.2      18.2       0.94      1.06      6.27
NSLB      NS&LBancorp-MO                           19.8      19.7       0.64      0.74      3.63
PWBK      PennwoodBancorp-PA                       18.0      18.0       0.86      0.98      5.28
SOBI      SobieskiBancorp-IN                       14.4      14.4       0.66      0.61      3.95
SSB       ScotlandBancorp-NC                       24.1      24.1       0.65      1.65      5.17
USAB      USABancshares-PA                          8.4       8.3       0.26      0.47      4.08
</TABLE> 

                Note: Stock prices are closing prices or last trade. Pro forma
                calculations for Northfield are based on sales at $10 a share
                with a minimum of $3,825,000, midpoint of $4,500,000, maximum of
                $5,175,000, and supermaximum of $5,591,250. Sources: Northfield
                FSB's audited and unaudited financial Statements, SNL
                Securities, and F&C calculations.

                                       7
<PAGE>
 
                                  SECTION IV

                             CORRELATION OF MARKET

                                     VALUE
<PAGE>
 
FERGUSON & COMPANY                                                    SECTION IV
- ------------------                                                    ----------


                       IV.  CORRELATION OF MARKET VALUE

MARKETABILITY & LIQUIDITY OF STOCK TO BE ISSUED

     Certain factors must be considered to determine whether adjustments are
required in correlating Northfield's market value to the comparative group.
Those factors include financial aspects, market area, management, dividends,
liquidity, thrift equity market conditions, and subscription interest.

     This section addresses the aforementioned factors and the estimated pro
forma market value of the to-be-issued common shares and compares the resulting
market value of the Bank to the members of its comparative group and the
selected group of publicly held thrifts.

FINANCIAL ASPECTS

     Section III includes a discussion regarding a comparison of Northfield's
earnings, balance sheet characteristics, and risk factors with its comparative
group. Table III.2 presents a comparison of certain key indicators, and Table
III.3 presents certain key indicators on a pro forma basis after conversion.

     As shown in Table III.2, from an earnings viewpoint, Northfield is below
its comparative group in core income as a percentage of average assets (0.84%
for Northfield Versus 0.96% for the group). Northfield's core income is based on
appraisal earnings which factors out unusual or nonrecurring items and the
comparative group's core income is computed on the same basis. Northfield's net
interest income as a percent of assets is 3.33% versus 3.82% for the
comparatives. The difference is principally attributable to Northfield's lower
ratio of interest-earning assets to interest-bearing liabilities, which is
caused by its lower capital position. Exhibit III, page 2 indicates that
Northfield's yield/cost spread was in the 55th percentile for calendar year
1994, the 58th percentile for calendar year 1995, the 49th percentile for
calendar year 1996, and the 48th percentile for the nine months ending September
30, 1997. Generally, this means that Northfield's net interest margin was near
the middle of the banks in its asset range. The peer group that Northfield is
compared to is all thrifts with assets between $25 million and $50 million
filing TFR reports with the OTS.

     Northfield's loan loss experience is nominal, as is the case with its
comparative group. However, in 1997, Northfield made a larger than normal loss
provision, ostensibly in recognition of a shortage in the allowance balance.
Northfield's other operating income is 0.09% of average assets, versus 0.25% for
the comparative group. Northfield's lower ratio results from its business mix.

     Northfield's operating expense ratio, at 1.93% of average assets, is well
below that of the comparative group, which is 2.46%. Northfield's lower ratio
results from its more traditional business mix and inexpensive facilities.

     After Northfield completes its stock conversion, its core income as a
percentage of average assets will increase. Table III.3 projects that
Northfield's return on assets will be 0.98% at the midpoint, versus a mean of
0.96% and median of 0.98% for the comparative group.

     Northfield's pro forma equity to assets ratio at the midpoint is 16.3%,
versus a mean of 17.2% and median of 18.1% for the comparative group.
Northfield's pro forma return on equity is 5.78% at the midpoint versus a mean
of 4.99% and median of 5.21% for the comparative group.

     We made adjustments to Northfield's recorded earnings for appraisal
purposes for the following non-recurring or non-core items: 1) Higher than
normal loan loss provision; 2) Loss on sale of investments; and 3) A new
directors' deferred compensation plan. Set forth below is a reconciliation of
appraisal earnings:

                                       1
<PAGE>
 
FERGUSON & COMPANY                                                    SECTION IV
- ------------------                                                    ----------


                  TABLE IV.1 - APPRAISAL EARNINGS ADJUSTMENTS

Net income, year ended December 31, 1997                              $145,000
                                                              ----------------
Add back excessive loan loss provision--123,000 less 40,000             83,000
Add back loss on sale of available for sale securities                  32,000
Add back deferred compensation                                         115,000
                                                              ----------------
Pretax adjustments                                                     230,000
Less related income taxes at 38%                                        88,000
                                                              ----------------
Net appraisal earning adjustments                                      142,000
Appraisal earnings, year ended December 31, 1997                      $287,000
                                                              ================

     Northfield's asset composition is more active than the comparative group.
Northfield has a higher ratio of loans to assets, lower ratio of investments and
mortgage-backed securities to assets, higher ratio of deposits to assets, lower
ratio of borrowings to assets, and lower ratio of equity to assets. From the
risk factor viewpoint, Northfield is slightly below the comparative group.
Northfield has a higher level of non performing assets, though it has a low
write off experience. Northfield's loan loss allowance is 0.72% of net loans,
compared with the comparative group, which is 0.63%. Its ratio of interest
earning assets to interest bearing liabilities (110.32%) is well below the
comparative group (120.32%). Northfield's ratio will exceed the comparative
group after conversion. At the midpoint, Northfield's ratio would be
approximately 121%, and at the supermaximum, it would be approximately 125%.
From an interest rate risk factor, Northfield probably has more exposure than
the comparative group.

     We believe that NO ADJUSTMENT is necessary relative to financial aspects of
Northfield.

MARKET AREA

     Section II describes Northfield's market area.

     We believe that NO ADJUSTMENT is required for Northfield's market area.

MANAGEMENT

     The President, who functions as CEO, has been with Northfield 14 years,
serving as CEO continuously since joining the Bank. The Vice President and Chief
Financial Officer has been with the Bank for 5 years, serving in his present
capacity since 1997. The Vice President and Compliance Officer has been with the
Bank for 14 years, serving as Vice President since 1987. Northfield has a
management succession plan.

     We believe  NO ADJUSTMENT is required for Northfield's management.

DIVIDENDS

     Table III.3 provides dividend information relative to the comparative group
and the thrift industry as a whole. The comparative group is paying a mean yield
on price of 1.72% and a median of 1.69%, while all public thrifts are paying a
mean of 1.68% and median of 1.63%. Northfield intends to pay an initial dividend
rate of $.20 annually, or 2% on the issue price of $10.00.

     We believe that NO ADJUSTMENT is required relative to Northfield's
intention to pay dividends.

                                       2
<PAGE>
 
FERGUSON & COMPANY                                                    SECTION IV
- ------------------                                                    ----------

LIQUIDITY

     The Holding Company has never issued capital stock to the public, and as a
result, no existing market for the Common Stock exists. Although the Holding
Company intends to list its Common Stock over the counter through the OTC
"Electronic Bulletin Board," there can be no assurance that a liquid trading
market will develop.

     A public market having the desirable characteristics of depth, liquidity,
and orderliness depends upon the presence, in the market place, of both willing
buyers and sellers of the Common Stock. These characteristics are not within the
control of the Bank or the market.

     The peer group includes companies with sufficient trading volume to develop
meaningful pricing characteristics for the stock. The market value of the
comparative group ranges from $7.05 million to $19.38 million, with a mean value
of $12.95 million. The midpoint of Northfield's valuation range is $4.5 million
at $10 a share, or 450,000 shares.

     We believe that a slight DOWNWARD ADJUSTMENT is required relative to the
liquidity of Northfield's stock.

THRIFT EQUITY MARKET CONDITIONS

     The SNL Thrift Index is summarized in Figure IV.1. As the table
demonstrates, the Thrift Index has performed well since the end of 1990. The
Index has grown as follows: Year ended December 31, 1991--increased 49.0% from
96.6 to 143.9; Year ended December 31, 1992--increased 39.7% to 201.1; Year
ended December 31, 1993--increased 25.6% to 252.5; Year ended December 31, 
1994--decreased 3.1% to 244.7; Year ended December 31, 1995--increased 53.9% to
376.5; Year ended December 31, 1996--increased 28.4% to 483.6; Year ended
December 31, 1997--increased 69.3% to 814.1; and Period ended February 27, 
1998--increased 0.6% to 818.7. It is market value weighted with a base value of
100 as of March 31, 1984.

     As shown in Figure IV.1, which is a graph of the SNL Thrift Index covering
from December 31, 1990 through February 27, 1998, the market, as depicted by the
index, has experienced fluctuations recently. It dipped in the latter part of
1994, but recovered during the first quarter of 1995. During 1995, the Index
continued a more robust increase and moved from 244.7 at year end 1994 to 376.5
by December 31, 1995, an increase of 53.9%. However, the Index was flat for the
first six months of 1996, but it has picked up since June 30, 1996. It closed
1996 at 483.6, up 28.4% from 1995. It closed 1997 at 814.1, a robust growth of
68.3% for the year. It is up 0.6% (to 818.7) from December 31, 1997 to February
27, 1998, after dropping 5.6% to 768.3 during January 1998.

     The increase in the SNL Index, in general, has been parallel with the
increases in other equity markets with some interim fluctuations caused by
changes or anticipated changes in interest rates. Another factor, however, is
also notable. In other markets, increased prices are responding to improved
profits, with price to earnings ratios increasing as earnings potentials are
anticipated. However, the thrift IPO market has been affected by speculation
that the majority of the institutions will become viable consolidation
candidates and sell at some expanded multiple of book value.

MARYLAND ACQUISITIONS

     Table IV.2 provides information relative to acquisitions of financial
institutions in Maryland announced during 1997. There were two thrift
acquisitions and two bank acquisitions announced during that time frame.
Currently, there are six publicly held thrifts in the State of Maryland. There
are 91 publicly held thrifts in the Mid-Atlantic region of the country. Bank
acquisitions in Maryland in 1997 averaged 235.9% of book value and 16.4 times
earnings. Thrifts generally sell at lower price/book multiples than do banks.
Thrifts in Maryland during that period averaged 191.2% of book value and 42.5
times earnings.

                                       3
<PAGE>
 
FERGUSON & COMPANY                                                    SECTION IV
- ------------------                                                    ----------

EFFECT OF INTEREST RATES ON THRIFT STOCK

     The current interest rate environment and the anticipated rate environment
will affect the pricing of thrift stocks and all other interest sensitive
stocks. As the economy continues to expand, the fear of inflation can return.
The Federal Reserve, in its resolve to curb inflation, has increased rates in
the past, but has more recently relented and passed several opportunities to
increase rates until March 25, 1997, when the Federal Open Market Committee
("FOMC") increased the discount rate 25 basis points. In some minds, this was an
attempt to head off inflationary trends. According to the FOMC, "This action was
taken in light of persisting strength in demand, which is progressively
increasing the risk of inflationary imbalances developing in the economy that
would eventually undermine the long expansion."/1/ This increase was clearly
telegraphed by Chairman Greenspan who voiced concern about the levels of the
equity markets. Following the March 25 increase, unemployment rates were
announced at the 5.2% level, down from the 5.5% level at the beginning of 1996,
and significantly down from the 6.7% level at the beginning of 1994./2/ The good
news about unemployment gave way to speculation that the March 25th increase was
just the first of at least two or three increases, and the speculation was given
some credence at that time by rises in the Employment Cost index, an increase in
Unit Labor Cost, and an upward trend in the price of crude oil. By April 1,
1997, following the rate increase, the equities markets lost all of the gains
registered since the first of the year. By the end of April 1997, the market had
begun a rebound and has trended upward since then. There have been specific days
of price adjustment, but the overall trend is up. Chairman Greenspan, in recent
public appearances, has not articulated concerns about market levels and
inflation. Since the significant market adjustment that occurred on October 21,
1997, the Federal Reserve has publicized inaction. The market reaction to the
inaction has been mixed--generally regarded as a neutral response.

     The thrift equities market is following the market in general. However, the
thrift equities market can continue to be influenced by the speculation that
there will eventually be a buyout, and the fact that thrift IPO stock can be
purchased at significant discounts from book value. These two facts could keep
the thrift equities market from falling as much as the other general markets.
Large mergers are likely to slow. But at the regional level, merger activity is
likely to continue.

     What is likely to happen in the short to intermediate term is that rates
will float around current levels, but will be trending downward for the next few
months. By year end, the long bond could be as low as 5.40%. The GDP is likely
to grow at a rate of 2.5% to 3.0%, with most of the growth coming in the first
half of the year. Inflation will moderate at between 1.5% and 2.0% for the year.

     With the Federal Reserve always ready to raise (or lower) rates as economic
conditions warrant, it is likely that before this expansion cycle is over,
interest rates will rise. The supply and demand portion of the equation is
nicely balanced, and a continuation of such equilibrium will probably restrain
rising rates in the near term. It is even possible that in the short-term,
interest rates might ease a bit.

     The consumer seems happier now than in the past. Job markets are strong and
the unemployment rate was recently 4.6%--the lowest since November 1973.
Consumer confidence is at a 28 year high. Our continuing economic health has
always been dependent upon meaningful consumer participation, because consumers
(household sector) actually account for 68% of the Gross Domestic Product
("GDP").

     In the second quarter of 1997, consumers seemed to rein in their
consumption. This lowering of consumption may be only to catch their economic
breath and repay credit card debt and other personal debt which has accumulated.
Manufacturing is still strong, even with the slight drop in retail sales, home
purchases and other big ticket items.

- ---------------
/1/ US Financial Data, published by the Research Division of the Federal Reserve
    Bank of St. Louis, MO.
/2/ National Economic Trends, the Federal Reserve Bank of St. Louis, MO.

                                       4
<PAGE>
 
FERGUSON & COMPANY                                                    SECTION IV
- ------------------                                                    ----------

     With consumer confidence at a high level, jobs plentiful, inflation
seemingly in check, and the economy healthy and continuing to expand, why
shouldn't the economy continue to roll onward and upward? From an analytical
view, there is one thing on the economic horizon that could negatively impact
our economy--the Pacific Rim countries are in depression. Some of the Pacific
Rim countries will resist or only pay "lip service" to the IMF requirements.
These economies have only one way out of their problems--exports. They will
begin to export at very low prices and this will have a negative impact on the
United States corporate profits. Our corporate profits will be hit from two
directions with the Pacific Rim problems--1) competition from exports as we have
discussed coupled with 2) loss of sales by the United States due to economic
inability of the Pacific Rim customers to buy our products and services.

     Thrift net interest margins have remained stable. The equilibrium in the
supply and demand portion of the interest rate market has helped continue the
profitability mode of the industry that started in 1993. Access to mortgage-
backed securities and derivatives has made it possible for many to be profitable
without making loans in significant volumes. With reduced deposit insurance
premiums, perhaps they will become more willing to compete for customer
deposits.

     As clearly illustrated, the SNL Thrift Index has performed well over the
last seven years. It moved in tandem with all interest sensitive stocks and
reflected the weakness in the market as investors began to consider the
importance of increases in rates and their impact on the net interest margins of
thrifts. The clear implication is that rising interest rates will have a
negative impact on earnings.

     Figure IV.2 graphically displays the rate environment since September 12,
1997. At that time, the yield curve was relatively flat, with only a 105 basis
point ("BP") difference between the one year treasury bill rate and the 30 year
treasury. Since that time, the yield curve has become flatter, with a 52 BP
spread between the one year treasury bill rate and the 30 year treasury rate at
February 27, 1998.

     At September 12, 1997, the spread between the 1 year T-Bill and the 5 year
T-Note was 64 BP, and the spread between the 5 year T-Note and the 30 year bond
was 41 BP. On February 27, 1998, the spreads were 18 and 34 BP, respectively.

     From September 12, 1997, to February 27, 1998, the Fed Funds rate increased
3 BP and the Prime Rate did not change.

     Increased cost of funds will serve to narrow the net interest margins of
thrifts. A thrift's ability to maintain net interest margins through business
cycles is important to investors, unless thrifts can offset the decline in net
interest income by other sources of revenue or reductions in noninterest
expense. The former is difficult and the latter is unlikely.

     Northfield, with its level of interest rate risk, is highly vulnerable to
rising rates. However, such risk will be reduced by the additional capital
arising from the conversion.

     During 1993, conversion stocks often experienced first day 30% or more
increases in value. As Table IV.3 shows, recent price appreciation has become
quite robust, surpassing 1993 levels. Table IV.3 provides information on 13
conversions completed since August 31, 1997 and listed on major exchanges. The
average change in price since conversion is a gain of 63.6% and the median
change is a gain of 66.6%. Within that group, all have increased in value with a
range of a low of 43.1% to a high of 81.3%. The average increase in value at one
day, one week, and one month after conversion has been 54.0%, 56.6%, and 53.3%,
respectively. The median increase in value at one day, one week, and one month
after conversion has been 50.6%, 60.0%, and 56.3%, respectively.

     Because of the lack of complete earnings information on recent conversions,
a meaningful comparison of the price earnings ratios is difficult to make.
However, there is information, albeit limited, to review the price to book
ratio. The average price-to-book ratio, as of February 27, 1998, is 115.2% and
the 

                                       5
<PAGE>
 
FERGUSON & COMPANY                                                    SECTION IV
- ------------------                                                    ----------


median is 115.2%. That compares to the offering price to pro forma book, where
the average was 76.8% and the median was 76.6%.

     Table IV.4 provides information on 13 pink sheet conversions completed
since February 28, 1997. The average change in price since conversion is a gain
of 50.6% and the median change is a gain of 55.0%. Within that group, all have
increased in value with a range of a low of 26.2% to a high of 75.0%. The
average increase in value at one day, one week, and one month after conversion
has been 37.4%, 37.3%, and 40.9%, respectively. The median increase in value at
one day, one week, and one month after conversion has been 37.5%, 36.9%, and
41.3%, respectively.

     Because of the lack of complete earnings information on recent conversions,
a meaningful comparison of the price earnings ratios is difficult to make.
However, there is information to review the price to book ratio. The average
price-to-book ratio, as of February 27, 1998, is 99.0% and the median is 99.0%.
That compares to the offering price to pro forma book, where the average was
71.6% and the median was 72.3%.

     We believe a DOWNWARD ADJUSTMENT is required for the new issue discount.

ADJUSTMENTS CONCLUSION

                              Adjustments Summary

- --------------------------------------------------------------------------------
                                NO CHANGE           UPWARD              DOWN
                                
Financial Aspects                   X
Market Area                         X
Management                          X
Dividends                           X
Liquidity                                                                 X
Thrift Equity Market Conditions                                           X
- --------------------------------------------------------------------------------

VALUATION APPROACH

     Typically, investors rely on the price/earnings ratio as the most
appropriate indicator of value. We consider price/earnings to be one of the
important pricing methods in valuing a thrift stock. Price/book is a well
recognized yardstick for measuring the value of financial institution stocks in
general. Another method of viewing thrift values is price/assets, which is more
meaningful in situations where the subject is thinly capitalized. Given the
healthy condition of the thrift industry today, more emphasis is placed on
price/earnings and price/book. Generally, price/earnings and price/book should
be considered in tandem.

     Table III.3 presents Northfield's pro forma ratios and compares them to the
ratios of its comparative group and the publicly held thrift industry as a
whole. Northfield's net income for the twelve months ended December 31, 1997,
was approximately $145,000, with adjustments of $142,000 required to determine
appraisal earnings of $287,000. The Bank's capital level after conversion will
reduce its interest rate risk; however, it will continue to have significant
interest rate risk exposure from rising rates. The Bank projects healthy growth.

     The comparative group traded at an average of 24.3 times earnings at
February 27, 1998, and at 123.9% of book value. The comparative group traded at
a median of 20.8 times earnings and a median of 119.06% of book value. At the
midpoint of the valuation range, Northfield is priced at 12.2 times earnings and
69.5% of book value. At the maximum end of the range, Northfield is priced at
13.5 times earnings and 

                                       6
<PAGE>
 
FERGUSON & COMPANY                                                    SECTION IV
- ------------------                                                    ----------


73.3% of book value. At the supermaximum, Northfield is priced at 14.9 times
earnings and 77.0% of book value.

     The midpoint valuation of $4,500,000 represents a discount of 43.9% from
the average and a discount of 41.6% from the median of the comparative group on
a price/book basis. The price/earnings ratio for Northfield at the midpoint
represents a discount of 49.8% from the comparative group's mean and a discount
of 41.3% from the median price/earnings ratio.

     The maximum valuation of $5,175,000 represents a discount of 40.8% from the
average and 38.4% from the median of the comparative group on a price/book
basis. The price/earnings ratio for Northfield at the maximum represents a
discount of 44.4% from the average and a discount of 35.1% from the median of
the comparative group.

     As shown in Table IV.3, conversions closing since August 31, 1997, have
closed at an average price to book ratio of 76.8% and median of 76.6%.
Northfield's pro forma price to book ratio is 69.5% at the midpoint, 73.3% at
the maximum, and 77.0% at the supermaximum of the range. At the midpoint,
Northfield is 9.5% below the average and 9.3% below the median. At the maximum
of the range, Northfield is 4.6% below the average and 4.3% below the median. At
the supermaximum of the range, Northfield's pro forma price to book ratio is
0.3% above the average and 0.5% above the median.

     As shown in Table IV.4, pink sheet conversions closing since February 28,
1997, have closed at an average price to book ratio of 71.6% and median of
72.3%. Northfield's pro forma price to book ratio is 69.5% at the midpoint,
73.3% at the maximum, and 77.0% at the supermaximum of the range. At the
midpoint, Northfield is 2.9% below the average and 3.9% below the median. At the
maximum of the range, Northfield is 2.4% above the average and 1.4% above the
median. At the supermaximum of the range, Northfield's pro forma price to book
ratio is 7.5% above the average and 6.5% above the median.

VALUATION CONCLUSION

     We believe that as of February 27, 1998, the estimated pro forma market
value of Northfield was $4,500,000. The resulting valuation range was $3,825,000
at the minimum to $5,175,000 at the maximum, based on a range of 15% below and
15% above the midpoint valuation. The supermaximum is $5,951,250, based on 1.15
times the maximum. Pro forma comparisons with the comparative group are
presented in Table III.3 based on calculations shown in Exhibit VII.

                                       7
<PAGE>
 

<TABLE> 
<CAPTION> 
FERGUSON & COMPANY                            TABLE IV.2 - MARYLAND ACQUISITIONS                                       SECTION IV
- ------------------                                    (ANNOUNCED IN 1997)                                              ----------

                                                                                             Seller:        Seller:         Ann'd
                                                                                             1:Total        1:Eqty/      Deal Pr/
                                                                              Announce        Assets         Assets        Assets
Buyer                      ST    Seller                    ST    TYPE             Date        ($000)            (%)           (%) 
<S>                        <C>  <C>                       <C>   <C>           <C>           <C>               <C>           <C> 
Fulton Finl Corp           PA    Peoples Bk, Elkton        MD    B            03/18/97        92,324           10.7          23.2
MainStreet BnGp Inc        VA    Commerce Bank Corp        MD    B            06/24/97        69,315            8.1          20.6
Provident Bkshrs           MD    First Citizens Fin'l      MD    T            03/11/97       687,196            6.1          15.1
Crestar Financial          VA    American Natl Bncp        MD    T            06/23/97       505,318            9.0          15.2
                                                                                      
                                 Maximum                                                     687,196           10.7          23.2
                                 Minimum                                                      69,315            6.1          15.1
                                 Average                                                     338,538            8.5          18.5
                                 Median                                                      298,821            8.5          17.9
                                 Average-banks                                                80,820            9.4          21.9
                                 Median-banks                                                 80,820            9.4          21.9
                                 Average-thrifts                                             596,257            7.5          15.2
                                 Median-thrifts                                              596,257            7.5          15.2
</TABLE> 
                                       8
SOURCE:  SNL & F&C CALCULATIONS
<PAGE>
 

<TABLE> 
<CAPTION> 
FERGUSON & COMPANY                              TABLE IV.2 - MARYLAND ACQUISITIONS                                    SECTION IV
- ------------------                                      (ANNOUNCED IN 1997)                                           ----------

                                   Ann'd          Ann'd          Ann'd             Ann'd         Seller:        Seller:  
                                    Deal       Deal Pr/           Deal        TgBk Prem/           1:YTD          1:YTD  
                                   Pr/Bk          4-Qtr        Pr/Deps          CoreDeps            ROAA           ROAE  
Seller                               (%)        EPS (x)            (%)               (%)             (%)            (%)
<S>                               <C>             <C>            <C>               <C>             <C>           <C> 
Peoples Bk, Elkton                 216.0           17.2           27.5              16.7            1.42          12.59
Commerce Bank Corp                 255.9           15.6           26.4              20.0            1.42          17.16
First Citizens Fin'l               220.9           31.6           19.3              11.6            0.48           7.98
American Natl Bncp                 161.5           53.3           23.4              10.6            0.29           3.13

Maximum                            255.9           53.3           27.5              20.0            1.42          17.16
Minimum                            161.5           15.6           19.3              10.6            0.29           3.13
Average                            213.6           29.4           24.1              14.7            0.90          10.22
Median                             218.4           24.4           24.9              14.1            0.95          10.29
Average-banks                      235.9           16.4           27.0              18.3            1.42          14.88
Median-banks                       235.9           16.4           27.0              18.3            1.42          14.88
Average-thrifts                    191.2           42.5           21.3              11.1            0.39           5.56
Median-thrifts                     191.2           42.5           21.3              11.1            0.39           5.56
</TABLE> 

                                       9
SOURCE:  SNL & F&C CALCULATIONS
<PAGE>

 
<TABLE> 
<CAPTION> 
FERGUSON & COMPANY                              TABLE IV.3 - RECENT CONVERSIONS                                       SECTION IV
- ------------------                             (COMPLETED SINCE AUGUST 31, 1997)                                      ----------

                                                                               Conversion               Gross         Offering
                                                                                   Assets            Proceeds            Price
Ticker          Short Name                           State         IPO Date        ($000)              ($000)              ($)
<S>            <C>                                   <C>          <C>            <C>                 <C>               <C> 
RCBK            Richmond County Financial Corp        NY           02/18/98       993,370             244,663           10.000
HFBC            HopFed Bancorp Inc.                   KY           02/09/98       202,496              40,336           10.000
TSBK            Timberland Bancorp Inc.               WA           01/13/98       206,188              66,125           10.000
MYST            Mystic Financial Inc.                 MA           01/09/98       149,653              27,111           10.000
UTBI            United Tennessee Bankshares           TN           01/05/98        64,189              14,548           10.000
PEDE            Great Pee Dee Bancorp                 SC           12/31/97        60,538              21,821           10.000
UCBC            Union Community Bancorp               IN           12/29/97        84,291              30,418           10.000
WSBI            Warwick Community Bancorp             NY           12/23/97       286,545              66,065           10.000
SIB             Staten Island Bancorp Inc.            NY           12/22/97     2,144,500             515,775           12.000
HCBC            High Country Bancorp Inc.             CO           12/10/97        76,324              13,225           10.000
FSFF            First SecurityFed Financial           IL           10/31/97       260,002              64,080           10.000
OTFC            Oregon Trail Financial Corp.          OR           10/06/97       204,213              46,949           10.000
SHSB            SHS Bancorp Inc.                      PA           10/01/97        81,688               8,200           10.000

Maximum                                                                         2,144,500             515,775           12.000
Minimum                                                                            60,538               8,200           10.000
Average                                                                           370,307              89,178           10.154
Median                                                                            202,496              40,336           10.000
</TABLE> 

                                      10
SOURCE:  SNL & F&C CALCULATIONS
<PAGE>
 

<TABLE> 
<CAPTION> 
FERGUSON & COMPANY                              TABLE IV.3 - RECENT CONVERSIONS                                       SECTION IV
- ------------------                             (COMPLETED SINCE AUGUST 31, 1997)                                      ----------

                               Conversion Pricing Ratios
                --------------------------------------------------------------
                     Price/            Price/           Price/         Price/          Current           Current          Current
                  Pro-Forma         Pro-Forma        Pro-Forma       Adjusted            Stock            Price/      Price/ Tang
                 Book Value        Tang. Book         Earnings         Assets            Price        Book Value       Book Value
Ticker                  (%)               (%)              (x)            (%)              ($)               (%)              (%) 
<S>               <C>               <C>               <C>            <C>                <C>             <C>             <C> 
RCBK                  79.6              79.6             14.0           19.8             16.656              NA               NA
HFBC                  75.4              75.4             12.4           16.6             17.313              NA               NA
TSBK                  81.5              81.5             10.5           24.3             17.625              NA               NA
MYST                  77.8              77.8             17.5           15.3             17.000              NA               NA
UTBI                  76.6              76.6             18.4           18.5             14.313              NA               NA
PEDE                  73.9              73.9             15.9           26.5             15.875           112.2            112.2
UCBC                  74.1              74.1             13.5           26.5             14.625              NA               NA
WSBI                  78.6              78.6             13.7           18.7             16.000              NA               NA
SIB                   80.6              83.0             14.1           19.4             20.500              NA               NA
HCBC                  77.7              77.7             30.5           14.8             14.750              NA               NA
FSFF                  75.2              75.2             14.9           19.8             15.375              NA               NA
OTFC                  76.6              76.6             18.5           18.7             18.125           118.2            118.2
SHSB                  70.7              70.7             13.9            9.1             18.000              NA               NA

Maximum               81.5              83.0             30.5           26.5             20.500           118.2            118.2
Minimum               70.7              70.7             10.5            9.1             14.313           112.2            112.2
Average               76.8              77.0             16.0           19.1             16.627           115.2            115.2
Median                76.6              76.6             14.1           18.7             16.656           115.2            115.2
</TABLE> 

                                      11

SOURCE:  SNL & F&C CALCULATIONS
<PAGE>

 
<TABLE> 
<CAPTION> 
FERGUSON & COMPANY                              TABLE IV.3 - RECENT CONVERSIONS                                       SECTION IV
- ------------------                             (COMPLETED SINCE AUGUST 31, 1997)                                      ----------

                                                                                        Post Conversion Price Change
                Price One             Price One       Price One        ------------------------------------------------------------
                Day After            Week After     Month After               One             One            One              To
               Conversion            Conversion      Conversion               Day            Week          Month            Date
Ticker                ($)               ($)                 ($)               (%)             (%)            (%)             (%) 
<S>               <C>                 <C>               <C>                 <C>             <C>            <C>             <C> 
RCBK               16.313             16.438                 NA              63.1            64.4             NA            66.6
HFBC               16.813             16.000                 NA              68.1            60.0             NA            73.1
TSBK               14.500             16.000             16.000              45.0            60.0           60.0            76.3
MYST               14.438             15.625             15.000              44.4            56.3           50.0            70.0
UTBI               14.750             13.750             14.250              47.5            37.5           42.5            43.1
PEDE               16.125             15.500             14.875              61.3            55.0           48.8            58.8
UCBC               14.688             14.250             14.250              46.9            42.5           42.5            46.3
WSBI               15.625             17.000             15.625              56.3            70.0           56.3            60.0
SIB                19.063             19.438             19.188              58.9            62.0           59.9            70.8
HCBC               14.438             15.063             14.500              44.4            50.6           45.0            47.5
FSFF               15.063             15.125             16.063              50.6            51.3           60.6            53.8
OTFC               16.750             16.375             16.125              67.5            63.8           61.3            81.3
SHSB               14.750             16.250             16.000              47.5            62.5           60.0            80.0

Maximum            19.063             19.438             19.188              68.1            70.0           61.3            81.3
Minimum            14.438             13.750             14.250              44.4            37.5           42.5            43.1
Average            15.640             15.909             15.625              54.0            56.6           53.3            63.6
Median             15.063             16.000             15.625              50.6            60.0           56.3            66.6
</TABLE> 

                                      12
SOURCE:  SNL & F&C CALCULATIONS

<PAGE>

 
<TABLE> 
<CAPTION> 
FERGUSON & COMPANY                           TABLE IV.4 - RECENT PINK SHEET CONVERSIONS                               SECTION IV
- ------------------                              (COMPLETED SINCE FEBRUARY 28, 1997)                                   ----------

                                                                                 Conversion
                                                                                     Assets          IPO Proceeds         IPO Price
Ticker          Short Name                         State        IPO Date             ($000)                ($000)              ($)  
<S>             <C>                                 <C>        <C>                 <C>                   <C>               <C> 
SFSH            SFSB Holding Co.                     PA         02/27/98             37,810                 7,260           10.000
WPBC            Wyman Park Bancorp                   MD         01/07/98             62,241                10,117           10.000
DFFN            Delaware First Financial Corp.       DE         01/05/98            112,545                11,570           10.000
CDLC            Coddle Creek Financial Corp.         NC         12/31/97            114,162                33,724           50.000
NARK            North Arkansas Bancshares Inc.       AR         12/19/97             34,379                 3,703           10.000
OSFS            Ohio State Financial Services        OH         09/29/97             33,929                 6,332           10.000
CIBC            Citizens Bancorp Inc.                IN         09/18/97             45,153                10,580           10.000
WSBH            WSB Holding Co.                      PA         08/29/97             33,139                 3,306           10.000
SCYT            Security Bancorp Inc.                TN         06/30/97             44,121                 4,364           10.000
SVBC            Sistersville Bancorp Inc.            WV         06/26/97             26,258                 6,614           10.000
SFBK            SFB Bancorp Inc.                     TN         05/30/97             46,579                 7,670           10.000
RFFC            Rocky Ford Financial Inc.            CO         05/22/97             20,388                 4,232           10.000
VBAS            Vermilion Bancorp Inc.               IL         03/26/97             35,459                 3,968           10.000

Maximum                                                                             114,162                33,724           50.000
Minimum                                                                              20,388                 3,306           10.000
Average                                                                              49,705                 8,726           13.077
Median                                                                               37,810                 6,614           10.000
</TABLE> 
                                      13
SOURCE:  SNL & F&C CALCULATIONS

<PAGE>

<TABLE> 
<CAPTION> 

FERGUSON & COMPANY                      TABLE IV.4 - RECENT PINK SHEET CONVERSIONS                              SECTION IV
- ------------------                                                                                              ----------
                                          (COMPLETED SINCE FEBRUARY 28, 1997)



 
                             Conversion Pricing Ratios
              -----------------------------------------------------------
                   Price/         Price/           Price/         Price/       Current        Current         Current       Current
                Pro-Forma      Pro-Forma        Pro-Forma       Adjusted         Stock         Price/     Price/ Tang        Price/
               Book Value        Tang. Book     Earnings         Assets         Price     Book Value      Book Value      Earnings
<S>            <C>             <C>             <C>              <C>           <C>        <C>             <C>             <C>  
Ticker                (%)            (%)              (x)            (%)           ($)            (%)             (%)           (x)

SFSH               76.0           76.0             NA             16.1          12.813         NA              NA            NA
WPBC               75.0           75.0             28.4           14.0          15.870         NA              NA            NA
DFFN               73.7           73.7             20.6            9.3          13.120         NA              NA            NA
CDLC               77.9           77.9             22.3           22.8          79.120         NA              NA            NA
NARK               72.3           72.3             NA              9.7          12.620         86.6            86.6          NA
OSFS               63.3           63.3             17.0           15.7          17.500        106.3           106.3          NA
CIBC               73.5           73.5             16.1           19.0          15.250        104.7           104.7          19.1
WSBH               71.4           71.4             NA              9.1          15.000        101.3           101.3          75.0
SCYT               72.9           72.9             18.1            9.0          16.375        109.5           109.5          12.4
SVBC               65.4           65.4             26.7           20.1          15.750         95.3            95.3          23.2
SFBK               69.6           69.6             17.7           14.1          15.500         99.0            99.0          14.4
RFFC               68.8           68.8             17.7           17.2          14.500         93.3            93.3          33.0
VBAS               71.4           71.4             NA             10.1          15.625         95.3            95.3          21.7

Maximum            77.9           77.9             28.4           22.8          79.120        109.5           109.5          75.0
Minimum            63.3           63.3             16.1            9.0          12.620         86.6            86.6          12.4
Average            71.6           71.6             20.5           14.3          19.926         99.0            99.0          28.4
Median             72.3           72.3             18.1           14.1          15.500         99.0            99.0          21.7
</TABLE> 

Source: SNL & F&C calculations
                                      14
<PAGE>

<TABLE> 
<CAPTION> 

FERGUSON & COMPANY                                      TABLE IV.4 - RECENT PINK SHEET CONVERSIONS                SECTION IV
                                                          (COMPLETED SINCE FEBRUARY 28, 1997)

 
                   Price One          Price One          Price One                      Post Conversion Price Change
                                                                       -------------------------------------------------------------
                   Day After         Week After        Month After           One             One            One              To
                  Conversion         Conversion         Conversion           Day            Week          Month            Date
Ticker                   ($)                ($)                ($)           (%)             (%)            (%)             (%)
<S>               <C>                <C>               <C>                 <C>             <C>            <C>             <C>  
SFSH              12.813             NA                 NA                  28.1            NA             NA              28.1
WPBC              13.750             13.620             14.620              37.5            36.2           46.2            58.7
DFFN              NA                 11.960             12.750              NA              19.6           27.5            31.2
CDLC              77.000             77.620             79.370              54.0            55.2           58.7            58.2
NARK              12.500             12.750             13.000              25.0            27.5           30.0            26.2
OSFS              15.500             15.370             14.960              55.0            53.7           49.6            75.0
CIBC              14.000             14.000             15.000              40.0            40.0           50.0            52.5
WSBH              13.500             13.500             13.750              35.0            35.0           37.5            50.0
SCYT              14.500             15.000             15.250              45.0            50.0           52.5            63.8
SVBC              13.750             13.875             14.250              37.5            38.8           42.5            57.5
SFBK              13.813             13.750             14.000              38.1            37.5           40.0            55.0
RFFC              13.000             13.125             13.500              30.0            31.3           35.0            45.0
VBAS              12.375             12.250             12.125              23.8            22.5           21.3            56.3

Maximum           77.000             77.620             79.370              55.0            55.2           58.7            75.0
Minimum           12.375             11.960             12.125              23.8            19.6           21.3            26.2
Average           18.875             18.902             19.381              37.4            37.3           40.9            50.6
Median            13.750             13.685             14.125              37.5            36.9           41.3            55.0
</TABLE> 


Source: SNL & F&C calculations
                                      15
<PAGE>

<TABLE> 
<CAPTION> 
FERGUSON & COMPANY                                         Table IV.5                                                   Section IV
- ------------------                                                                                                      ----------
                                                   Comparison of Pricing Ratios
 
                                                                                  Group                          Percent Premium
                                                   Northfield                  Compared to                      (Discount) Versus
                                                                    -----------------------------   -------------------------------
                                                     Federal             Average          Median          Average           Median
                                                 ---------------    -------------  --------------   -------------- ----------------
Comparison of PE ratio at
  midpoint to:
- ----------------------------------------------
<S>                                             <C>                 <C>             <C>              <C>              <C>   
Comparative group                                     12.2               24.3              20.8              (49.8)           (41.3)
Maryland thrifts                                      12.2               27.5              29.2              (55.6)           (58.2)
Mid-Atlantic Region thrifts                           12.2               22.2              21.3              (45.0)           (42.7)
All public thrifts                                    12.2               21.3              20.6              (42.7)           (40.8)
Recent conversions                                    12.2               16.0              14.1              (23.8)           (13.5)
Recent pink sheet conversions                         12.2               20.5              18.1              (40.5)           (32.6)

Comparison of PE ratio at
  maximum to:
- ----------------------------------------------
Comparative group                                     13.5               24.3              20.8              (44.4)           (35.1)
Maryland thrifts                                      13.5               27.5              29.2              (50.9)           (53.8)
Mid-Atlantic Region thrifts                           13.5               22.2              21.3              (39.2)           (36.6)
All public thrifts                                    13.5               21.3              20.6              (36.6)           (34.5)
Recent conversions                                    13.5               16.0              14.1              (15.6)            (4.3)
Recent pink sheet conversions                         13.5               20.5              18.1              (34.1)           (25.4)

Comparison of PE ratio at
  supermaximum to:
- ----------------------------------------------
Comparative group                                     14.9               24.3              20.8              (38.7)           (28.4)
Maryland thrifts                                      14.9               27.5              29.2              (45.8)           (49.0)
Mid-Atlantic Region thrifts                           14.9               22.2              21.3              (32.9)           (30.0)
All public thrifts                                    14.9               21.3              20.6              (30.0)           (27.7)
Recent conversions                                    14.9               16.0              14.1               (6.9)             5.7
Recent pink sheet conversions                         14.9               20.5              18.1              (27.3)           (17.7)

Comparison of PB ratio at
  midpoint to:
- ----------------------------------------------
Comparative group                                     69.5              123.9             119.0              (43.9)           (41.6)
Maryland thrifts                                      69.5              178.3             170.6              (61.0)           (59.3)
Mid-Atlantic Region thrifts                           69.5              176.3             161.7              (60.6)           (57.0)
All public thrifts                                    69.5              173.6             159.7              (60.0)           (56.5)
Recent conversions                                    69.5               76.8              76.6               (9.5)            (9.3)
Recent pink sheet conversions                         69.5               71.6              72.3               (2.9)            (3.9)

Comparison of PB ratio at
  maximum to:
- ----------------------------------------------
Comparative group                                     73.3              123.9             119.0              (40.8)           (38.4)
Maryland thrifts                                      73.3              178.3             170.6              (58.9)           (57.0)
Mid-Atlantic Region thrifts                           73.3              176.3             161.7              (58.4)           (54.7)
All public thrifts                                    73.3              173.6             159.7              (57.8)           (54.1)
Recent conversions                                    73.3               76.8              76.6               (4.6)            (4.3)
Recent pink sheet conversions                         73.3               71.6              72.3                2.4              1.4

Comparison of PB ratio at
  supermaximum to:
- ----------------------------------------------
Comparative group                                     77.0              123.9             119.0              (37.9)           (35.3)
Maryland thrifts                                      77.0              178.3             170.6              (56.8)           (54.9)
Mid-Atlantic Region thrifts                           77.0              176.3             161.7              (56.3)           (52.4)
All public thrifts                                    77.0              173.6             159.7              (55.6)           (51.8)
Recent conversions                                    77.0               76.8              76.6                0.3              0.5
Recent pink sheet conversions                         77.0               71.6              72.3                7.5              6.5
</TABLE> 

Source: SNL & F&C calculations
                                      16
<PAGE>
 
FERGUSON & COMPANY              Figure IV.1 - SNL Index               Section IV
- ------------------                                                    ----------



                                % CHANGE SINCE
                                --------------
                        SNL PREVIOUS

         DATE           INDEX      DATE       12/31/96        12/31/97    
         ----           -----      ----       --------        --------    
                                                                          
       12/31/90          96.6                                             
       12/31/91         143.9       49.0%                                 
       12/31/92         201.1       39.7%                                 
       12/31/93         252.5       25.6%                                 
       12/31/94         244.7       -3.1%                                 
       12/31/95         376.5       53.9%                                 
       12/31/96         483.6       28.4%                                 
        3/31/97         527.7        9.1%         9.1%                    
        6/30/97         624.6       18.4%        29.2%                    
        9/30/97         737.5       18.1%        52.5%                    
       12/31/97         814.1       10.4%        68.3%                    
        1/30/98         768.3       -5.6%        58.9%           -5.6%    
        2/27/98         818.7        6.6%        69.3%            0.6%     


                                   SNL INDEX


                             [GRAPH APPEARS HERE]





Source: SNL & F&C calculations
                                      17
<PAGE>


FERGUSON & COMPANY   Figure IV.2 - Interest Rates                     Section IV
- ------------------                                                    ----------


- -----------------------------------------------------------------  -----------
                            1 Year    5 Year   10 Year   30 Year    1 to 30   
               Fed Fds(*)   T-bill    Treas.   Treas.    Treas.     Yr. Spread 
- -----------------------------------------------------------------  -----------

12-Sep-97         5.48        5.59     6.23     6.34     6.64         1.05
- -----------------------------------------------------------------  -----------
26-Sep-97         5.45        5.46     6.00     6.08     6.36
10-Oct-97         5.46        5.44     5.93     6.04     6.34         0.90
- -----------------------------------------------------------------  -----------
24-Oct-97         5.54        5.52     6.02     6.09     6.38
 7-Nov-97         5.60        5.43     5.81     5.92     6.20         0.77
- -----------------------------------------------------------------  -----------
21-Nov-97         5.51        5.46     5.79     5.84     6.06
 5-Dec-97         5.58        5.54     5.82     5.86     6.04         0.50
- -----------------------------------------------------------------  -----------
19-Dec-97         5.66        5.49     5.74     5.77     5.96
 2-Jan-98         5.45        5.52     5.71     5.75     5.93         0.41
- -----------------------------------------------------------------  -----------
16-Jan-98         5.45        5.17     5.32     5.45     5.74
30-Jan-98         5.53        5.27     5.48     5.63     5.89         0.62
- -----------------------------------------------------------------  -----------
13-Feb-98         5.43        5.27     5.47     5.57     5.89
27-Feb-98         5.51        5.42     5.60     5.63     5.94         0.52
- -----------------------------------------------------------------  -----------


               Rates September 12, 1997 through February 17, 1998
 

                             [CHART APPEARS HERE]

Source: Financial Data, Federal Reserve Bank of St. Louis, MO.

                                      18
<PAGE>
 
                                    EXHIBITS
                                        
<PAGE>
 
                                   EXHIBIT I
<PAGE>
 
FERGUSON & COMPANY
- ------------------

                        Exhibit I - Firm Qualifications

     Ferguson & Company (F&C), is a financial, economic, and regulatory
consulting firm providing services to financial institutions.  It is located in
Hurst, Texas.  Its services to financial institutions include:

 .  Mergers and acquisition services

 .  Business plans

 .  Fairness opinions and conversion appraisals

 .  Litigation support

 .  Operational and efficiency consulting

 .  Human resources evaluation and management

     F&C developed several financial institution databases of information
derived from periodic financial reports filed with regulatory authorities by
financial institutions. For example, F&C developed TAFS and BankSource.  TAFS
includes thrifts filing TFR's with the OTS and BankSource includes banks and
savings banks filing call reports with the FDIC.  Both databases include
information from the periodic reports plus numerous calculations derived from
F&C's analysis.  In addition, both databases are interactive, permitting the
user to conduct merger analysis, do peer group comparisons, and a number of
other items.  In 1994, F&C sold its electronic publishing segment to Sheshunoff
Information Services Inc., Austin, Texas.

     Brief biographical information is presented below on F&C's principals:

WILLIAM C. FERGUSON, MANAGING PARTNER
- -------------------------------------

Mr. Ferguson has approximately 30 years of experience providing various services
to financial institutions.  He was a partner in a CPA firm prior to founding F&C
in 1984. Mr. Ferguson is a frequent speaker for financial institution seminars
and he has testified before Congressional Committees several times on his
analysis of the state of the thrift industry. Mr. Ferguson has a B.A. degree
from Austin Peay University and an M.S. degree from the University of Tennessee.
He is a CPA.

CHARLES M. HEBERT, PRINCIPAL
- ----------------------------

Mr. Hebert has over 30 years of experience providing services to and managing
financial institutions.  He spent 7 years as a national bank examiner, 14 years
in bank management, 5 years in thrift management, and has spent the last 8 years
on the F&C consulting staff. Mr. Hebert holds a B.S. degree from Louisiana State
University.

ROBIN L. FUSSELL, PRINCIPAL
- ---------------------------

Mr. Fussell has over 25 years of experience providing professional services to
and managing financial institutions.  He worked on the audit staff of a "Big
Six" accounting firm for 12 years, served as CFO of a thrift for 3 years, and
has worked in financial institution consulting for the last 14 years.  He is a
co-founder of F&C.  He holds a B.S. degree from East Carolina University.  He is
a CPA.

                                       1
<PAGE>
 
                                  EXHIBIT II


<PAGE>
 
FERGUSON & COMPANY    Exhibit II.1 - Selected Mid-Atlantic Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                                             Deposit
                                                                                             Insurance
                                                                                             Agency
Ticker  Short Name                                City                     State   Region    (BIF/SAIF)   Exchange       IPO Date
<S>     <C>                                       <C>                      <C>     <C>       <C>          <C>            <C>
AFED    AFSALA Bancorp Inc.                       Amsterdam                NY      MA        SAIF         NASDAQ         10/01/96
ALBC    Albion Banc Corp.                         Albion                   NY      MA        SAIF         NASDAQ         07/26/93
ALBK    ALBANK Financial Corp.                    Albany                   NY      MA        SAIF         NASDAQ         04/01/92
ASFC    Astoria Financial Corp.                   Lake Success             NY      MA        SAIF         NASDAQ         11/18/93
CATB    Catskill Financial Corp.                  Catskill                 NY      MA        BIF          NASDAQ         04/18/96
CMSB    Commonwealth Bancorp Inc.                 Norristown               PA      MA        SAIF         NASDAQ         06/17/96
CVAL    Chester Valley Bancorp Inc.               Downingtown              PA      MA        SAIF         NASDAQ         03/27/87
DIME    Dime Community Bancorp Inc.               Brooklyn                 NY      MA        BIF          NASDAQ         06/26/96
DME     Dime Bancorp Inc.                         New York                 NY      MA        BIF          NYSE           08/19/86
EQSB    Equitable Federal Savings Bank            Wheaton                  MD      MA        SAIF         NASDAQ         09/10/93
ESBK    Elmira Savings Bank (The)                 Elmira                   NY      MA        BIF          NASDAQ         03/01/85
FBBC    First Bell Bancorp Inc.                   Pittsburgh               PA      MA        SAIF         NASDAQ         06/29/95
FBER    1st Bergen Bancorp                        Wood-Ridge               NJ      MA        SAIF         NASDAQ         04/01/96
FFIC    Flushing Financial Corp.                  Flushing                 NY      MA        BIF          NASDAQ         11/21/95
FIBC    Financial Bancorp Inc.                    Long Island City         NY      MA        SAIF         NASDAQ         08/17/94
FKFS    First Keystone Financial                  Media                    PA      MA        SAIF         NASDAQ         01/26/95
FMCO    FMS Financial Corp.                       Burlington               NJ      MA        SAIF         NASDAQ         12/14/88
FSBI    Fidelity Bancorp Inc.                     Pittsburgh               PA      MA        SAIF         NASDAQ         06/24/88
GAF     GA Financial Inc.                         Pittsburgh               PA      MA        SAIF         AMSE           03/26/96
GPT     GreenPoint Financial Corp.                New York                 NY      MA        BIF          NYSE           01/28/94
HARL    Harleysville Savings Bank                 Harleysville             PA      MA        SAIF         NASDAQ         08/04/87
HAVN    Haven Bancorp Inc.                        Woodhaven                NY      MA        SAIF         NASDAQ         09/23/93
HRBF    Harbor Federal Bancorp Inc.               Baltimore                MD      MA        SAIF         NASDAQ         08/12/94
IBSF    IBS Financial Corp.                       Cherry Hill              NJ      MA        SAIF         NASDAQ         10/13/94
JSB     JSB Financial Inc.                        Lynbrook                 NY      MA        BIF          NYSE           06/27/90
LARL    Laurel Capital Group Inc.                 Allison Park             PA      MA        SAIF         NASDAQ         02/20/87
LFBI    Little Falls Bancorp Inc.                 Little Falls             NJ      MA        SAIF         NASDAQ         01/05/96
LFED    Leeds Federal Bankshares (MHC)            Baltimore                MD      MA        SAIF         NASDAQ         05/02/94
LISB    Long Island Bancorp Inc.                  Melville                 NY      MA        SAIF         NASDAQ         04/18/94
LVSB    Lakeview Financial                        Paterson                 NJ      MA        SAIF         NASDAQ         12/22/93
MBB     MSB Bancorp, Inc.                         Goshen                   NY      MA        BIF          AMSE                 NA
OCFC    Ocean Financial Corp.                     Toms River               NJ      MA        SAIF         NASDAQ         07/03/96
PBCI    Pamrapo Bancorp Inc.                      Bayonne                  NJ      MA        SAIF         NASDAQ         11/14/89
PEEK    Peekskill Financial Corp.                 Peekskill                NY      MA        SAIF         NASDAQ         12/29/95
PFNC    Progress Financial Corp.                  Blue Bell                PA      MA        SAIF         NASDAQ         07/18/83
PFSB    PennFed Financial Services Inc            West Orange              NJ      MA        SAIF         NASDAQ         07/15/94
PHFC    Pittsburgh Home Financial Corp            Pittsburgh               PA      MA        SAIF         NASDAQ         04/01/96
PRBC    Prestige Bancorp Inc.                     Pleasant Hills           PA      MA        SAIF         NASDAQ         06/27/96
PULS    Pulse Bancorp                             South River              NJ      MA        SAIF         NASDAQ         09/18/86
PVSA    Parkvale Financial Corp.                  Monroeville              PA      MA        SAIF         NASDAQ         07/16/87
PWBC    PennFirst Bancorp Inc.                    Ellwood City             PA      MA        SAIF         NASDAQ         06/13/90
PWBK    Pennwood Bancorp Inc.                     Pittsburgh               PA      MA        SAIF         NASDAQ         07/15/96
QCSB    Queens County Bancorp Inc.                Flushing                 NY      MA        BIF          NASDAQ         11/23/93
RARB    Raritan Bancorp Inc.                      Bridgewater              NJ      MA        BIF          NASDAQ         03/01/87
RELY    Reliance Bancorp Inc.                     Garden City              NY      MA        SAIF         NASDAQ         03/31/94
ROSE    TR Financial Corp.                        Garden City              NY      MA        BIF          NASDAQ         06/29/93
SFED    SFS Bancorp Inc.                          Schenectady              NY      MA        SAIF         NASDAQ         06/30/95
</TABLE>


Source: SNL & F&C calculations         1
<PAGE>
 
FERGUSON & COMPANY    Exhibit II.1 - Selected Mid-Atlantic Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                                           Deposit
                                                                                           Insurance
                                                                                           Agency
Ticker  Short Name                                City                   State   Region    (BIF/SAIF)   Exchange       IPO Date
<S>     <C>                                       <C>                    <C>     <C>       <C>          <C>            <C>
SFIN    Statewide Financial Corp.                 Jersey City            NJ      MA        SAIF         NASDAQ         10/02/95
SKAN    Skaneateles Bancorp Inc.                  Skaneateles            NY      MA        BIF          NASDAQ         06/02/86
SVRN    Sovereign Bancorp Inc.                    Wyomissing             PA      MA        SAIF         NASDAQ         08/12/86
THRD    TF Financial Corp.                        Newtown                PA      MA        SAIF         NASDAQ         07/13/94
TPNZ    Tappan Zee Financial Inc.                 Tarrytown              NY      MA        SAIF         NASDAQ         10/05/95
WHGB    WHG Bancshares Corp.                      Lutherville            MD      MA        SAIF         NASDAQ         04/01/96
WSB     Washington Savings Bank, FSB              Bowie                  MD      MA        SAIF         AMSE                 NA
WSFS    WSFS Financial Corp.                      Wilmington             DE      MA        BIF          NASDAQ         11/26/86
WVFC    WVS Financial Corp.                       Pittsburgh             PA      MA        SAIF         NASDAQ         11/29/93
WYNE    Wayne Bancorp Inc.                        Wayne                  NJ      MA        SAIF         NASDAQ         06/27/96
YFCB    Yonkers Financial Corp.                   Yonkers                NY      MA        SAIF         NASDAQ         04/18/96
YFED    York Financial Corp.                      York                   PA      MA        SAIF         NASDAQ         02/01/84
                                               
Maximum                                        
Minimum                                        
Average                                        
Median                                         
</TABLE>


Source: SNL & F&C calculations         2
<PAGE>
 
FERGUSON & COMPANY    Exhibit II.1 - Selected Mid-Atlantic Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                                                                           Tangible
            Current      Current       Price/    Current     Current                   Current          Total   Equity/     Equity/
              Stock       Market          LTM     Price/    Price/ T      Price/      Dividend         Assets    Assets    T Assets
              Price        Value     Core EPS     Book V      Book V      Assets         Yield         ($000)       (%)         (%)
Ticker          ($)         ($M)          (x)        (%)         (%)         (%)           (%)            MRQ       MRQ         MRQ
<S>          <C>           <C>           <C>       <C>         <C>          <C>           <C>         <C>          <C>         <C> 
AFED         19.625        27.05         21.1      120.0       120.0        16.9          1.43        160,408      12.5        12.5
ALBC         10.750         8.06         25.0      133.0       133.0        11.4          0.99         70,810       8.6         8.6
ALBK         48.625       627.60         15.5      174.5       224.7        15.4          1.48      4,083,097       8.8         7.0
ASFC         55.875     1,463.80         19.7      172.4       247.7        13.9          1.43     10,528,393       8.5         6.2
CATB         18.375        85.08         21.6      118.7       118.7        28.9          1.74        294,656      24.3        24.3
CMSB         20.375       331.04         29.1      154.1       195.2        14.6          1.37      2,268,595       9.5         7.6
CVAL         31.750        69.14         23.4      239.8       239.8        21.1          1.39        325,643       8.8         8.8
DIME         25.125       312.51         28.2      167.8       194.2        21.0          1.27      1,488,074      12.5        11.0
DME          30.500     3,548.92         27.2      269.9       329.0        16.2          0.53     21,848,000       6.0         5.0
EQSB         30.500        37.11         17.1      221.5       221.5        11.5           --         321,687       5.2         5.2
ESBK         28.875        21.42         27.5      143.9       147.8         9.4          2.22        228,268       6.4         6.2
FBBC         18.750       122.07         15.6      167.3       167.3        18.1          2.13        675,684      10.8        10.8
FBER         19.750        56.57         27.1      145.5       145.5        19.9          1.01        284,739      13.7        13.7
FFIC         25.500       200.55         22.6      147.0       153.0        18.4          1.26      1,088,476      12.5        12.1
FIBC         26.000        44.45         15.5      161.5       162.2        14.4          1.92        308,248       8.9         8.9
FKFS         17.500        42.22         16.5      168.6       168.6        11.2          1.14        378,527       6.6         6.6
FMCO         35.000        83.57         15.4      221.5       224.8        14.4          0.80        581,660       6.5         6.4
FSBI         28.875        45.09         17.2      167.8       167.8        11.5          1.25        393,076       6.8         6.8
GAF          19.625       151.46         18.0      130.4       131.6        19.3          2.45        783,948      14.8        14.7
GPT          74.250     3,142.26         20.6      218.4       400.5        24.0          1.72     13,083,518       9.7         5.5
HARL         30.000        50.01         14.9      210.8       210.8        14.4          1.47        347,882       6.8         6.8
HAVN         24.500       215.23         19.6      190.7       191.3        10.9          1.22      1,974,890       5.7         5.7
HRBF         24.000        40.64         25.3      139.4       139.4        17.4          2.00        233,572      12.5        12.5
IBSF         17.750       194.26         32.9      150.4       150.4        26.7          2.25        728,181      17.7        17.7
JSB          53.813       533.82         21.1      149.9       149.9        34.8          2.97      1,531,068      23.2        23.2
LARL         22.000        47.85         17.3      212.2       212.2        22.4          1.58        213,379      10.6        10.6
LFBI         20.000        52.16         33.3      137.7       149.3        16.1          1.00        324,425      11.7        10.9
LFED         21.625       112.06         32.8      231.3       231.3        38.5          2.59        291,408      16.6        16.6
LISB         60.188     1,446.23         33.6      259.5       261.9        23.8          1.00      6,072,524       9.2         9.1
LVSB         25.875       107.75         29.4      194.7       230.2        20.8          0.48        517,974      10.7         9.2
MBB          34.875        99.19         31.1      155.7       292.1        12.8          1.72        773,991       9.8         6.2
OCFC         35.250       282.52         21.5      127.6       127.6        19.4          2.27      1,489,220      15.2        15.2
PBCI         26.750        76.05         16.1      156.7       157.7        20.2          4.19        376,714      12.9        12.8
PEEK         17.000        53.16         25.4      114.3       114.3        28.9          2.12        184,215      25.2        25.2
PFNC         16.875        68.58         24.5      273.1       325.1        13.9          0.71        493,406       5.1         4.3
PFSB         18.625       179.66         16.6      161.7       188.7        12.2          0.75      1,475,509       7.0         6.0
PHFC         17.750        34.96         17.9      141.8       143.5        11.7          1.35        299,669       8.2         8.1
PRBC         19.125        17.50         21.3      112.0       112.0        12.2          1.05        143,263      10.9        10.9
PULS         26.250        81.17         14.8      183.4       183.4        15.0          3.05        539,322       8.2         8.2
PVSA         31.750       162.83         15.7      201.1       202.2        15.9          1.64      1,019,143       7.9         7.9
PWBC         19.125       101.57         18.4      147.6       166.0        12.4          1.88        822,350       8.4         7.5
PWBK         22.000        12.11         25.6      131.3       131.3        25.7          1.64         47,211      18.0        18.0
QCSB         39.750       592.78         28.2      299.8       299.8        39.0          2.01      1,541,049      11.2        11.2
RARB         26.500        62.86         17.4      203.7       206.6        15.4          2.26        408,308       7.6         7.5
RELY         35.500       342.01         19.1      178.2       261.6        15.3          1.80      2,243,100       8.6         6.0
ROSE         32.969       580.19         18.8      226.8       226.8        15.1          2.06      3,843,056       6.3         6.3
SFED         21.500        25.98         23.9      121.3       121.3        14.9          1.49        174,428      12.3        12.3
</TABLE>


Source: SNL & F&C calculations         3
<PAGE>
 
FERGUSON & COMPANY    Exhibit II.1 - Selected Mid-Atlantic Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                                                                           Tangible
            Current      Current       Price/    Current     Current                   Current          Total   Equity/     Equity/
              Stock       Market          LTM     Price/    Price/ T      Price/      Dividend         Assets    Assets    T Assets
              Price        Value     Core EPS     Book V      Book V      Assets         Yield         ($000)       (%)         (%)
Ticker          ($)         ($M)          (x)        (%)         (%)         (%)           (%)            MRQ       MRQ         MRQ
<S>          <C>           <C>           <C>       <C>         <C>          <C>           <C>         <C>          <C>         <C> 
SFIN         22.750       102.58         17.9      158.7       158.9        14.9          1.93        703,112       9.4         9.4
SKAN         19.125        27.48         17.6      155.5       159.8        10.7          1.46        256,101       6.9         6.7
SVRN         19.375     1,810.48         21.3      254.6       306.6        12.6          0.41     14,336,283       5.4         4.7
THRD         26.000        82.87         24.5      149.8       179.4        13.9          1.85        597,047       8.4         7.1
TPNZ         18.750        27.71         26.8      128.8       128.8        21.9          1.49        126,470      17.0        17.0
WHGB         18.500        25.70         33.0      129.0       129.0        25.4          1.73        101,331      19.7        19.7
WSB           8.750        38.46         29.2      170.6       170.6        14.5          1.14        264,904       8.5         8.5
WSFS         20.750       258.54         16.3      298.1       299.9        17.1           --       1,515,217       5.7         5.7
WVFC         38.000        68.71         17.9      214.1       214.1        22.8          3.16        292,022      10.7        10.7
WYNE         24.500        49.34         22.7      148.6       148.6        18.5          0.82        267,285      12.4        12.4
YFCB         18.688        56.45         17.5      125.7       125.7        17.0          1.50        331,802      13.5        13.5
YFED         25.500       225.72         25.0      215.4       215.4        19.1          2.04      1,182,276       8.9         8.9

Maximum      74.250     3,548.92         33.6      299.8       400.5        39.0          4.19     21,848,000      25.2        25.2
Minimum       8.750         8.06         14.8      112.0       112.0         9.4           --          47,211       5.1         4.3
Average      26.909       318.09         22.2      176.3       191.8        18.1          1.59      1,818,282      10.8        10.3
Median       24.500        82.87         21.3      161.7       170.6        16.1          1.49        493,406       9.4         8.9
</TABLE>


Source: SNL & F&C calculations         4
<PAGE>
 
FERGUSON & COMPANY    Exhibit II.1 - Selected Mid-Atlantic Publicly Held Thrifts

<TABLE>
<CAPTION>
              Core       Core      Core                               NPAs/   Price/      Core       Core       Core
               EPS       ROAA      ROAE     Merger         Current   Assets     Core       EPS       ROAA       ROAE
               ($)        (%)       (%)    Target?         Pricing      (%)      EPS       ($)        (%)        (%)
Ticker         LTM        LTM       LTM      (Y/N)            Date      MRQ      (x)       MRQ        MRQ        MRQ
<S>           <C>        <C>       <C>     <C>            <C>          <C>      <C>       <C>        <C>        <C> 
AFED          0.93       0.79      5.91        N          02/27/98     0.30     20.4      0.24       0.78       6.19
ALBC          0.43       0.49      5.46        N          02/27/98     0.12     22.4      0.12       0.53       6.17
ALBK          3.14       1.18     12.92        N          02/27/98     0.70     11.1      1.10       1.55      17.41
ASFC          2.83       0.77      9.55        N          02/27/98     0.52     20.5      0.68       0.75       8.66
CATB          0.85       1.34      5.19        N          02/27/98     0.35     20.9      0.22       1.31       5.30
CMSB          0.70       0.50      5.17        N          02/27/98     0.42     30.0      0.17       0.45       4.88
CVAL          1.36       0.95     11.04        N          02/27/98     0.55     22.1      0.36       0.96      11.03
DIME          0.89       0.86      5.86        N          02/27/98     0.53     27.3      0.23       0.78       6.08
DME           1.12       0.60     11.05        N          02/27/98     1.06     34.7      0.22       0.49       8.31
EQSB          1.78       0.74     14.65        N          02/27/98     0.38     17.7      0.43       0.70      13.55
ESBK          1.05       0.34      5.40        N          02/27/98     0.63     30.1      0.24       0.30       4.80
FBBC          1.20       1.06     10.03        N          02/27/98     0.09     15.1      0.31       1.08      10.01
FBER          0.73       0.77      4.94        N          02/27/98     0.84     27.4      0.18       0.69       4.94
FFIC          1.13       0.88      6.08        N          02/27/98     0.27     21.3      0.30       0.85       6.37
FIBC          1.68       0.99     10.50        N          02/27/98     1.89     15.5      0.42       0.94      10.31
FKFS          1.06       0.73     10.47        N          02/27/98     1.15     17.5      0.25       0.64       9.65
FMCO          2.27       1.02     15.74        N          02/27/98     1.15     15.4      0.57       0.99      15.00
FSBI          1.68       0.76     11.16        N          02/27/98     0.15     17.6      0.41       0.68      10.02
GAF           1.09       1.08      6.80        N          02/27/98     0.22     17.5      0.28       1.01       6.92
GPT           3.60       1.08     10.64        N          02/27/98     2.90     19.1      0.97       1.11      11.68
HARL          2.01       1.02     15.66        N          02/27/98       --     15.6      0.48       0.95      14.11
HAVN          1.25       0.63     10.51        N          02/27/98     0.66     18.0      0.34       0.63      10.79
HRBF          0.95       0.72      5.55        N          02/27/98     0.53     28.6      0.21       0.64       4.92
IBSF          0.54       0.79      4.36        N          02/27/98     0.11     31.7      0.14       0.84       4.78
JSB           2.55       1.72      7.67        N          02/27/98     1.02     21.0      0.64       1.74       7.59
LARL          1.27       1.40     13.48        N          02/27/98     0.42     17.7      0.31       1.37      12.98
LFBI          0.60       0.51      3.93        N          02/27/98     0.90     27.8      0.18       0.57       4.75
LFED          0.66       1.21      7.36        N          02/27/98     0.03     33.8      0.16       1.14       6.83
LISB          1.79       0.71      7.82        N          02/27/98     0.89     33.4      0.45       0.69       7.61
LVSB          0.88       0.89      8.44        N          02/27/98     1.14     24.9      0.26       1.00       8.70
MBB           1.12       0.54      6.17        N          02/27/98       NA     28.1      0.31       0.60       6.81
OCFC          1.64       1.00      5.71        N          02/27/98     0.52     19.6      0.45       0.97       6.37
PBCI          1.66       1.31      9.87        N          02/27/98     1.70     17.6      0.38       1.15       8.88
PEEK          0.67       1.09      4.23        N          02/27/98     0.77     26.6      0.16       1.01       3.92
PFNC          0.69       0.70     13.37        N          02/27/98     0.50     26.4      0.16       0.64      12.09
PFSB          1.12       0.81     10.98        N          02/27/98     0.55     16.6      0.28       0.76      10.60
PHFC          0.99       0.71      6.51        N          02/27/98     1.68     17.1      0.26       0.67       6.86
PRBC          0.90       0.57      5.03        N          02/27/98     0.43     29.9      0.16       0.39       3.35
PULS          1.77       1.08     13.56        N          02/27/98     0.85     15.6      0.42       1.02      12.69
PVSA          2.02       1.07     14.71        N          02/27/98     0.36     15.3      0.52       1.08      14.56
PWBC          1.04       0.66      8.61        N          02/27/98     0.68     18.4      0.26       0.69       8.33
PWBK          0.86       0.98      5.28        N          02/27/98     0.74     34.4      0.16       0.70       3.85
QCSB          1.41       1.55     11.55        N          02/27/98     0.53     26.2      0.38       1.46      12.78
RARB          1.52       1.01     12.93        N          02/27/98     0.23     17.0      0.39       0.97      12.93
RELY          1.86       0.85     10.31        N          02/27/98     0.54     18.1      0.49       0.87      10.30
ROSE          1.75       0.87     14.16        N          02/27/98     0.48     17.5      0.47       0.89      14.35
SFED          0.90       0.61      4.87        N          02/27/98     0.82     23.4      0.23       0.56       4.63
</TABLE>


Source: SNL & F&C calculations         5
<PAGE>
 
FERGUSON & COMPANY    Exhibit II.1 - Selected Mid-Atlantic Publicly Held Thrifts

<TABLE>
<CAPTION>
              Core       Core      Core                               NPAs/    Price/     Core       Core        Core
               EPS       ROAA      ROAE     Merger         Current   Assets     Core       EPS       ROAA        ROAE
               ($)        (%)       (%)    Target?         Pricing      (%)      EPS       ($)        (%)         (%)
Ticker         LTM        LTM       LTM      (Y/N)            Date      MRQ      (x)       MRQ        MRQ         MRQ
<S>           <C>        <C>       <C>     <C>            <C>          <C>      <C>       <C>        <C>        <C> 
SFIN          1.27       0.81      8.46        N          02/27/98     0.33     17.2      0.33       0.81        8.62
SKAN          1.09       0.66      9.47        N          02/27/98     1.89     18.4      0.26       0.61        8.63
SVRN          0.91       0.69     12.55        N          02/27/98     0.63     17.3      0.28       0.80       15.13
THRD          1.06       0.66      6.28        N          02/27/98     0.29     24.1      0.27       0.61        7.45
TPNZ          0.70       0.80      4.65        N          02/27/98     1.19     27.6      0.17       0.74        4.35
WHGB          0.56       0.77      3.66        N          02/27/98     0.95     38.5      0.12       0.61        3.08
WSB           0.30       0.52      6.25        N          02/27/98       NA     36.5      0.06       0.39        4.59
WSFS          1.27       1.10     20.00        N          02/27/98     1.23     17.3      0.30       1.00       17.34
WVFC          2.12       1.31     11.03        N          02/27/98     0.20     16.4      0.58       1.44       11.95
WYNE          1.08       0.86      6.01        N          02/27/98     0.89     24.5      0.25       0.76        5.57
YFCB          1.07       1.04      7.00        N          02/27/98     0.49     18.0      0.26       0.92        6.63
YFED          1.02       0.80      9.36        N          02/27/98     1.01     27.7      0.23       0.74        8.44
                                             
Maximum       3.60       1.72     20.00                                2.90     38.5      1.10       1.740      17.410
Minimum       0.30       0.34      3.66                                  --     11.1      0.06       0.300       3.080
Average       1.29       0.88      8.91                                0.71     22.5      0.33       0.848       8.736
Median        1.09       0.81      8.46                                0.55     20.5      0.28       0.780       8.330
</TABLE>


Source: SNL & F&C calculations         6
<PAGE>
 
FERGUSON & COMPANY      Exhibit II.2 - Selected Maryland Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                                         Deposit
                                                                                         Insurance
                                                                                         Agency
Ticker    Short Name                                City              State   Region     (BIF/SAIF)   Exchange         IPO Date
<S>       <C>                                       <C>                 <C>    <C>      <C>           <C>              <C>
EQSB      Equitable Federal Savings Bank            Wheaton             MD      MA       SAIF         NASDAQ           09/10/93
HRBF      Harbor Federal Bancorp Inc.               Baltimore           MD      MA       SAIF         NASDAQ           08/12/94
LFED      Leeds Federal Bankshares (MHC)            Baltimore           MD      MA       SAIF         NASDAQ           05/02/94
WHGB      WHG Bancshares Corp.                      Lutherville         MD      MA       SAIF         NASDAQ           04/01/96
WSB       Washington Savings Bank, FSB              Bowie               MD      MA       SAIF         AMSE                   NA

Maximum
Minimum
Average
Median
</TABLE>


Source: SNL & F&C calculations         7
<PAGE>
 
FERGUSON & COMPANY      Exhibit II.2 - Selected Maryland Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                                                                  Tangible  
             Current    Current     Price/    Current     Current                 Current       Total   Equity/    Equity/     Core
               Stock     Market        LTM     Price/    Price/ T    Price/      Dividend      Assets    Assets   T Assets      EPS
               Price      Value   Core EPS     Book V      Book V    Assets         Yield      ($000)       (%)        (%)      ($)
                 ($)       ($M)        (x)        (%)         (%)       (%)           (%)         MRQ       MRQ        MRQ      LTM
<S>           <C>         <C>         <C>       <C>         <C>        <C>                    <C>           <C>        <C>     <C> 
EQSB          30.500      37.11       17.1      221.5       221.5      11.5            --     321,687       5.2        5.2     1.78
HRBF          24.000      40.64       25.3      139.4       139.4      17.4          2.00     233,572      12.5       12.5     0.95
LFED          21.625     112.06       32.8      231.3       231.3      38.5          2.59     291,408      16.6       16.6     0.66
WHGB          18.500      25.70       33.0      129.0       129.0      25.4          1.73     101,331      19.7       19.7     0.56
WSB            8.750      38.46       29.2      170.6       170.6      14.5          1.14     264,904       8.5        8.5     0.30
          
Maximum       30.500     112.06       33.0      231.3       231.3      38.5          2.59     321,687      19.7       19.7     1.78
Minimum        8.750      25.70       17.1      129.0       129.0      11.5            --     101,331       5.2        5.2     0.30
Average       20.675      50.79       27.5      178.3       178.3      21.5          1.49     242,580      12.5       12.5     0.85
Median        21.625      38.46       29.2      170.6       170.6      17.4          1.73     264,904      12.5       12.5     0.66
</TABLE>


Source: SNL & F&C calculations         8
<PAGE>
 
FERGUSON & COMPANY
- ------------------

             Exhibit II.2 - Selected Maryland Publicly Held Thrifts

<TABLE>
<CAPTION>
               Core      Core                             NPAs/  Price/      Core       Core      Core
               ROAA      ROAE    Merger         Current  Assets    Core       EPS       ROAA      ROAE
                (%)       (%)   Target?         Pricing     (%)     EPS       ($)        (%)       (%)
                LTM       LTM     (Y/N)            Date     MRQ     (x)       MRQ        MRQ       MRQ
<S>            <C>      <C>     <C>            <C>         <C>     <C>       <C>        <C>      <C>  
EQSB           0.74     14.65       N          02/27/98    0.38    17.7      0.43       0.70     13.55
HRBF           0.72      5.55       N          02/27/98    0.53    28.6      0.21       0.64      4.92
LFED           1.21      7.36       N          02/27/98    0.03    33.8      0.16       1.14      6.83
WHGB           0.77      3.66       N          02/27/98    0.95    38.5      0.12       0.61      3.08
WSB            0.52      6.25       N          02/27/98      NA    36.5      0.06       0.39      4.59
                              
Maximum        1.21     14.65                              0.95    38.5      0.43       1.140    13.550
Minimum        0.52      3.66                              0.03    17.7      0.06       0.390     3.080
Average        0.79      7.49                              0.47    31.0      0.20       0.696     6.594
Median         0.74      6.25                              0.46    33.8      0.16       0.640     4.920
</TABLE>


Source: SNL & F&C calculations         9
<PAGE>
 
FERGUSON & COMPANY      Exhibit 11.3 - Comparatives General Characteristics
- ------------------

<TABLE>
<CAPTION>

                                                                                   Total                     Current        Current
                                                                       Number     Assets                       Stock         Market
                                                                           of      ($000)                      Price          Value
Ticker      Short Name                     City             State     Offices        MRQ      IPO Date           ($)           ($M)
<S>         <C>                            <C>              <C>       <C>         <C>         <C>            <C>            <C> 

CKFB        CKF Bancorp Inc.               Danville         KY              1     62,865       01/04/95       19.500         16.91
HBBI        Home Building Bancorp          Washington       IN              2     42,430       02/08/95       22.625          7.05
HCFC        Home City Financial Corp.      Springfield      OH              1     70,110       12/30/96       18.625         16.85
LONF        London Financial Corp.         London           OH              1     37,916       04/01/96       14.875          7.59
MIVI        Mississippi View Holding Co.   Little Falls     MN              1     68,619       03/24/95       18.375         13.60
NSLB        NS&L Bancorp Inc.              Neosho           MO              2     59,817       06/08/95       17.375         12.26
PWBK        Pennwood Bancorp Inc.          Pittsburgh       PA              3     47,211       07/15/96       22.000         12.11
SOBI        Sobieski Bancorp Inc.          South Bend       IN              3     87,553       03/31/95       20.500         16.07
SSB         Scotland Bancorp Inc.          Laurinburg       NC              2     61,473       04/01/96       10.125         19.38
USAB        USA Bancshares, Inc.           Philadelphia     PA              1     64,269       NA             10.500          7.69

Maximum                                                                     3     87,553                      22.625         19.38
Minimum                                                                     1     37,916                      10.125          7.05
Average                                                                     2     60,226                      17.450         12.95
Median                                                                      2     62,169                      18.500         12.93
</TABLE>

Source: SNL & F&C calculations
                                      10
<PAGE>
 
FERGUSON & COMPANY     Exhibit II.4 - Comparative Balance Sheet Characteristics

<TABLE>
<CAPTION>
                                           Total   Mortgage-             Investment &       Loan                         
                               Total    Cash and      Backed         Net   Foreclosed  Servicing        Total      Other       Total
                              Assets Investments  Securities       Loans  Real Estate     Rights  Intangibles     Assets    Deposits
                              ($000)      ($000)      ($000)      ($000)       ($000)     ($000)       ($000)     ($000)      ($000)
Short Name                       MRQ         MRQ         MRQ         MRQ          MRQ        MRQ          MRQ        MRQ         MRQ
<S>                           <C>          <C>           <C>      <C>          <C>        <C>           <C>       <C>      <C>   
CKF Bancorp Inc.              62,865       5,977         373      55,895        --         --           --          -993      43,253
Home Building Bancorp         42,430      12,309       4,466      28,842        --         --           --        -1,279      32,082
Home City Financial Corp.     70,110       8,173         712      59,811        --         --           --        -2,126      51,632
London Financial Corp.        37,916       8,418       3,492      28,931        --         --           --          -567      30,673
Mississippi View Holding Co.  68,619      22,327       4,318      44,493        --         --           --        -1,799      54,867
NS&L Bancorp Inc.             59,817      24,111       4,473      33,847        --         --           83         1,744      43,892
Pennwood Bancorp Inc.         47,211      15,131       1,867      30,305        25         --           --        -1,750      36,267
Sobieski Bancorp Inc.         87,553      16,020      12,512      68,879       152         --           --        -2,502      57,611
Scotland Bancorp Inc.         61,473      15,706         383      44,492        --         --           --        -1,275      45,636
USABancshares, Inc.           64,269      28,056       7,308      33,824        --         --           82         2,307      46,195

Maximum                       87,553      28,056      12,512      68,879       152         --           83         2,502      57,611
Minimum                       37,916       5,977         373      28,842        --         --           --          -567      30,673
Average                       60,226      15,623       3,990      42,932        18         --           17         1,634      44,211
Median                        62,169      15,419       3,905      39,170        --         --           --        -1,747      44,764
</TABLE>


Source: SNL & F&C characteristics      11
<PAGE>
 
FERGUSON & COMPANY     Exhibit II.4 - Comparative Balance Sheet Characteristics

<TABLE>
<CAPTION>
                                                                                                              Regulatory  Regulatory
                                Total Subordinated        Other       Total  Preferred     Common      Total    Tangible        Core
                           Borrowings         Debt  Liabilities Liabilities     Equity     Equity     Equity     Capital     Capital
                               ($000)       ($000)       ($000)      ($000)     ($000)     ($000)     ($000)      ($000)      ($000)
Short Name                        MRQ          MRQ          MRQ         MRQ        MRQ        MRQ        MRQ         MRQ         MRQ
<S>                             <C>          <C>        <C>          <C>         <C>        <C>        <C>         <C>         <C>  
CKF Bancorp Inc.                5,214        --           635        49,102      --        13,763     13,763      12,245      12,245
Home Building Bancorp           4,000        --           381        36,463      --         5,967      5,967       4,542       4,542
Home City Financial Corp.       4,311        --           417        56,360      --        13,750     13,750      10,544      10,544
London Financial Corp.          1,700        --           325        32,698      --         5,218      5,218       6,000       6,000
Mississippi View Holding Co.     --          --         1,276        56,143      --        12,476     12,476      10,876      10,876
NS&L Bancorp Inc.               3,000        --         1,101        47,993      --        11,824     11,824       8,793       8,793
Pennwood Bancorp Inc.           1,448        --         1,006        38,721      --         8,490      8,490          NA       8,726
Sobieski Bancorp Inc.          16,850        --           491        74,952      --        12,601     12,601       9,166       9,166
Scotland Bancorp Inc.            --          --         1,042        46,678      --        14,795     14,795      12,762      12,762
USABancshares, Inc.            12,205        --           449        58,849      --         5,420      5,420          NA       4,845
                                                                  
Maximum                        16,850        --         1,276        74,952      --        14,795     14,795      12,762      12,762
Minimum                          --          --           325        32,698      --         5,218      5,218       4,542       4,542
Average                         4,873        --           712        49,796      --        10,430     10,430       9,366       8,850
Median                          3,500        --           563        48,548      --        12,150     12,150       9,855       8,980
</TABLE>
                                                                

Source: SNL & F&C characteristics       12
<PAGE>
 
FERGUSON & COMPANY    Exhibit II.4 - Comparative Balance Sheet Characteristics

<TABLE>
<CAPTION>
                              Regulatory                                                                     Loan Loss     Publicly
                                   Total     Tangible         Core   Risk-Based        NPAs/    Reserves/    Reserves/     Reported
                                 Capital     Capital/     Capital/     Capital/       Assets       Assets         NPLs   Book Value
                                  ($000)     Tangible Adj Tangible Risk-Weightd          (%)          (%)          (%)          ($)
Short Name                           MRQ   Assets (%)   Assets (%)   Assets (%)          MRQ          MRQ          MRQ          MRQ
<S>                               <C>            <C>          <C>          <C>          <C>          <C>        <C>           <C>  
CKF Bancorp Inc.                  12,370         20.9         20.9         36.8         0.10         0.20       189.39        17.14
Home Building Bancorp              4,625         10.1         10.1         21.0         0.67         0.20        29.02        20.61
Home City Financial Corp.         10,987          8.9          8.9         17.3         0.82         0.63        77.27        15.20
London Financial Corp.             6,200         15.6         15.6         30.2         0.20         0.48       238.16        10.23
Mississippi View Holding Co.      11,309         14.9         14.9         31.7         0.43         1.26       290.24        16.85
NS&L Bancorp Inc.                  8,837         13.8         13.8         38.5         0.03         0.07       220.00        16.61
Pennwood Bancorp Inc.              8,970           NA           NA           NA         0.74         0.52        74.85        16.76
Sobieski Bancorp Inc.              9,360         11.9         11.9         28.5         0.26         0.23       259.74        17.75
Scotland Bancorp Inc.             13,017           NA           NA           NA         --           0.41           NM         7.73
USABancshares, Inc.                5,102           NA           NA           NA         0.57         0.40        70.22         6.73

Maximum                           13,017         20.9         20.9         38.5         0.82         1.26       290.24        20.61
Minimum                            4,625          8.9          8.9         17.3         --           0.07        29.02         6.73
Average                            9,078         13.7         13.7         29.2         0.38         0.44       160.99        14.56
Median                             9,165         13.8         13.8         30.2         0.35         0.41       189.39        16.69
</TABLE>


Source: SNL & F&C characteristics        13
<PAGE>
 
FERGUSON & COMPANY     Exhibit II.4 - Comparative Balance Sheet Characteristics

<TABLE>
<CAPTION>
                                 Tangible Earn Assets/    Full-Time        Loans     Cash and
                             Publicly Rep  Int Bearing   Equivalent     Serviced  Investments/        MBS/
                               Book Value  Liabilities    Employees   For Others       Assets       Assets
                                      ($)          (%)     (Actual)       ($000)          (%)          (%)
Short Name                            MRQ          MRQ          MRQ          MRQ          MRQ          MRQ
<S>                                 <C>         <C>               <C>       <C>          <C>          <C> 
CKF Bancorp Inc.                    17.14       129.52            9         --           8.91         0.59
Home Building Bancorp               20.61       113.96           13         --          18.48        10.53
Home City Financial Corp.           15.20       122.84           15        2,529        10.64         1.02
London Financial Corp.              10.23       120.35           10         --          12.99         9.21
Mississippi View Holding Co.        16.85       122.33           21           NA        26.24         6.29
NS&L Bancorp Inc.                   16.49       123.63           24         --          32.83         7.48
Pennwood Bancorp Inc.               16.76       118.60           11          147        28.10         3.95
Sobieski Bancorp Inc.               17.75       112.35           24         --           4.01        14.29
Scotland Bancorp Inc.                7.73       131.42           13         --          24.93         0.62
USABancshares, Inc.                  6.63       108.17           11         --          32.28        11.37

Maximum                             20.61       131.42           24        2,529        32.83        14.29
Minimum                              6.63       108.17            9         --           4.01         0.59
Average                             14.54       120.32           15          297        19.94         6.54
Median                              16.63       121.34           13         --          21.71         6.89
</TABLE>


Source: SNL & F&C characteristics       14
<PAGE>
 
FERGUSON & COMPANY      Exhibit II 5 - Comparatives Operations Characteristics
- ------------------

<TABLE>
<CAPTION>
                                                    Net Income         ROAA                  ROAE                 Loan        Total
                             Average                    Before         Before   Core         Before    Core       Loss  Noninterest
                              Assets  Net Income   Extra Items   ROAA   Extra   ROAA   ROAE   Extra    ROAE  Provision       Income
                               ($000)      ($000)        ($000)   (%)     (%)    (%)    (%)     (%)     (%)     ($000)       ($000)
Short Name                       LTM         LTM           LTM    LTM     LTM    LTM    LTM     LTM     LTM        LTM          LTM
<S>                          <C>         <C>           <C>      <C>    <C>    <C>      <C>    <C>      <C>        <C>          <C> 

CKF Bancorp Inc.              61,434       1,117         1,117   1.82    1.82   1.37   7.74    7.74    5.84         18           62
Home Building Bancorp         43,889         329           329   0.75    0.75   0.72   5.70    5.70    5.48          7          108
Home City Financial Corp.         NA          NA            NA     NA      NA     NA     NA      NA      NA         NA           NA
London Financial Corp.        38,001         411           411   1.08    1.08   1.00   5.62    5.62    5.21          2           68
Mississippi View Holding Co.  68,792         744           744   1.08    1.08   1.06   6.37    6.37    6.27          -          175
NS&L Bancorp Inc.             58,720         456           456   0.78    0.78   0.74   3.83    3.83    3.63          2          198
Pennwood Bancorp Inc.         47,881         458           458   0.96    0.96   0.98   5.14    5.14    5.28         48          120
Sobieski Bancorp Inc.         82,090         497           497   0.61    0.61   0.61   3.95    3.95    3.95          -          137
Scotland Bancorp Inc.         66,893       1,113         1,113   1.66    1.66   1.65   5.21    5.21    5.17         24           74
USABancshares, Inc.           43,387         231           231   0.53    0.53   0.47   4.57    4.57    4.08         75          249
                                                                                                                          
Maximum                       82,090       1,117         1,117   1.82    1.82   1.65   7.74    7.74    6.27         75          249
Minimum                       38,001         231           231   0.53    0.53   0.47   3.83    3.83    3.63          -           62
Average                       56,787         595           595   1.03    1.03   0.96   5.35    5.35    4.99         20          132
Median                        58,720         458           458   0.96    0.96   0.98   5.21    5.21    5.21          7          120
</TABLE>

                                      15
<PAGE>
 
FERGUSON & COMPANY      Exhibit II 5 - Comparatives Operations Characteristics
- ------------------


<TABLE>
<CAPTION>
                                   Total    Net Loan                Common Dividend   Interest   Interest  Net Interest     Gain on
                             Noninterest Chargeoffs/     LTM EPS Dividends   Payout    Income/   Expense/       Income/       Sale/
                                 Expense   Avg Loans After Extra Per Share    Ratio Avg Assets Avg Assets    Avg Assets  Avg Assets
                                  ($000)         (%)         ($)       ($)      (%)        (%)        (%)           (%)         (%)
Short Name                           LTM         LTM         LTM       LTM      LTM        LTM        LTM           LTM         LTM
<S>                             <C>           <C>          <C>       <C>    <C>         <C>         <C>           <C>         <C> 

CKF Bancorp Inc.                   1,025        0.07        1.29      1.47   113.95       7.46       3.80          3.66        0.69
Home Building Bancorp              1,096        0.01        1.14      0.30    26.32       7.56       4.14          3.43        0.05
Home City Financial Corp.             NA          NA          NA        NA       NA         NA         NA            NA          NA
London Financial Corp.               891        0.03        0.86      5.24   609.30       7.66       3.97          3.69        0.12
Mississippi View Holding Co.       1,618        0.03        0.95      0.16    16.84       7.48       3.62          3.85        0.03
NS&L Bancorp Inc.                  1,372        -           0.68      0.50    73.53       6.65       3.52          3.14        0.06
Pennwood Bancorp Inc.              1,367        0.41        0.84      0.32    38.10       7.91       3.70          4.20        -
Sobieski Bancorp Inc.              1,966        -           0.66      0.30    45.45       7.27       4.02          3.25        -
Scotland Bancorp Inc.              1,509        -           0.65      6.28   965.38       7.56       3.06          4.50        0.36
USABancshares, Inc.                1,735        0.01        0.29      -        -          9.17       4.50          4.67        0.09
                            
Maximum                            1,966        0.41        1.29      6.28   965.38       9.17       4.50          4.67        0.69
Minimum                              891        -           0.29      -        -          6.65       3.06          3.14        -
Average                            1,398        0.06        0.82      1.62   209.87       7.64       3.81          3.82        0.16
Median                             1,372        0.01        0.84      0.32    45.45       7.56       3.80          3.69        0.06
</TABLE>


                                      16
<PAGE>
 
FERGUSON & COMPANY      Exhibit II 5 - Comparatives Operations Characteristics
- ------------------


<TABLE>
<CAPTION>
                             Real  Noninterest         G&A  Noninterest    Net Oper         Total  Amortization            Extra and
                           Estate      Income/    Expense/     Expense/   Expenses/  Nonrecurring            of       Tax  After Tax
                          Expense   Avg Assets  Avg Assets   Avg Assets  Avg Assets       Expense   Intangibles Provision      Items
                            ($000)         (%)         (%)          (%)         (%)        ($000)        ($000)    ($000)     ($000)
Short Name                    LTM          LTM         LTM          LTM         LTM           LTM           LTM       LTM        LTM
<S>                         <C>         <C>          <C>          <C>         <C>            <C>           <C>       <C>        <C> 

CKF Bancorp Inc.               42         0.10        1.60         1.67        1.50             -             -       575          -
Home Building Bancorp          (3)        0.25        2.50         2.50        2.26             -             -       200          -
Home City Financial Corp.      NA        NA           2.19        NA          NA               NA            NA        NA         NA
London Financial Corp.          -         0.18        2.34         2.34        2.17             -             -       212          -
Mississippi View 
  Holding Co.                 (12)        0.25        2.37         2.35        2.12             -             -       482          -
NS&L Bancorp Inc.               -         0.34        2.34         2.34        2.00             -             -       246          -
Pennwood Bancorp Inc.          43         0.25        2.77         2.85        2.51            65             -       240          -
Sobieski Bancorp Inc.          (2)        0.17        2.40         2.39        2.23             -             -       345          -
Scotland Bancorp Inc.           -         0.11        2.26         2.26        2.15           230             -       449          -
USABancshares, Inc.             -         0.57        3.87         4.00        3.30             -            56       272          -
                          
Maximum                        43         0.57        3.87         4.00        3.30           230            56       575          -
Minimum                       (12)        0.10        1.60         1.67        1.50             -             -       200          -
Average                         8         0.25        2.46         2.52        2.25            33             6       336          -
Median                          -         0.25        2.36         2.35        2.17             -             -       272          -
</TABLE>

                                      17
<PAGE>
 
FERGUSON & COMPANY      Exhibit II 5 - Comparatives Operations Characteristics
- ------------------


<TABLE>
<CAPTION>
                                                                 Yield on        Cost of               Interest      Loan Loss
                                   Efficiency     Preferred   Int Earning    Int Bearing   Effective      Yield     Provision/
                                        Ratio     Dividends        Assets    Liabilities    Tax Rate     Spread     Avg Assets
                                          (%)        ($000)           (%)            (%)         (%)        (%)            (%)
Short Name                                LTM           LTM           LTM            LTM         LTM        LTM            LTM
<S>                                   <C>             <C>           <C>           <C>         <C>        <C>             <C> 

CKF Bancorp Inc.                        42.50           -            7.64           5.09       33.98       2.55           0.03
Home Building Bancorp                   68.18           -            7.82           4.72       37.81       3.10           0.02
Home City Financial Corp.               NA             NA              NA             NA          NA         NA             NA
London Financial Corp.                  60.61           -            7.74           4.97       34.03       2.77           0.01
Mississippi View Holding Co.            57.68           -            7.58           4.52       39.31       3.06           -
NS&L Bancorp Inc.                       67.29           -            6.85           4.53       35.04       2.32           0.00
Pennwood Bancorp Inc.                   62.07           -            8.34           4.66       34.38       3.68           0.10
Sobieski Bancorp Inc.                   70.09           -            7.55           4.78       40.97       2.77           -
Scotland Bancorp Inc.                   48.91           -            7.69           4.61       28.75       3.08           0.04
USABancshares, Inc.                     73.80           -            9.42           5.21       54.08       4.21           0.17
                                                              
Maximum                                 73.80           -            9.42           5.21       54.08       4.21           0.17
Minimum                                 42.50           -            6.85           4.52       28.75       2.32           -
Average                                 61.24           -            7.85           4.79       37.59       3.06           0.04
Median                                  62.07           -            7.69           4.72       35.04       3.06           0.02
</TABLE>


                                      18
<PAGE>
 
FERGUSON & COMPANY
- ------------------

               Exhibit II.6 - Comparative Pricing Characteristics

<TABLE>
<CAPTION>
                                                      Current   Current     Price/   Current    Current             Current    Total
                                                        Stock    Market        LTM    Price/   Price/ T   Price/   Dividend   Assets
          Abbreviated                                   Price     Value   Core EPS    Book V     Book V   Assets      Yield   ($000)
Ticker    Name                  City           State      ($)      ($M)        (x)       (%)        (%)      (%)        (%)      MRQ
<S>       <C>                   <C>            <C>     <C>        <C>         <C>      <C>        <C>       <C>        <C>    <C>   
CKFB      CKFBancorp-KY         Danville       KY      19.500     16.91       20.1     113.8      113.8     26.9       2.56   62,865
HBBI      HomeBldngBncp-IN      Washington     IN      22.625      7.05       20.8     109.8      109.8     16.6       1.33   42,430
HCFC      HomeCityFinl-OH       Springfield    OH      18.625     16.85       NA       122.5      122.5     24.0       1.93   70,110
LONF      LondonFinlCorp-OH     London         OH      14.875      7.59       18.6     145.4      145.4     20.0       1.61   37,916
MIVI      MissViewHldgCo-MN     Little Falls   MN      18.375     13.60       19.6     109.1      109.1     19.8       1.74   68,619
NSLB      NS&LBancorp-MO        Neosho         MO      17.375     12.26       27.2     104.6      105.4     20.7       2.88   59,817
PWBK      PennwoodBancorp-PA    Pittsburgh     PA      22.000     12.11       25.6     131.3      131.3     25.7       1.64   47,211
SOBI      SobieskiBancorp-IN    South Bend     IN      20.500     16.07       31.1     115.5      115.5     17.9       1.56   87,553
SSB       ScotlandBancorp-NC    Laurinburg     NC      10.125     19.38       15.6     131.0      131.0     31.5       1.98   61,473
USAB      USABancshares-PA      Philadelphia   PA      10.500      7.69       40.4     156.0      158.4     12.0        --    64,269
                                                                                                                            
Maximum                                                22.625     19.38       40.4     156.0      158.4     31.5       2.88   87,553
Minimum                                                10.125      7.05       15.6     104.6      105.4     12.0        --    37,916
Average                                                17.450     12.95       24.3     123.9      124.2     21.5       1.72   60,226
Median                                                 18.500     12.93       20.8     119.0      119.0     20.3       1.69   62,169
</TABLE>


Source: SNL & F&C calculations         19
<PAGE>
 
FERGUSON & COMPANY      Exhibit II.6 - Comparative Pricing Characteristics

<TABLE>
<CAPTION>
                    Tangible                                ROACE                                          
         Equity/     Equity/      Core     Core    Core    Before                         NPAs/   Price/      Core    Core      Core
          Assets    T Assets       EPS     ROAA    ROAE     Extra     Merger     Current Assets     Core       EPS    ROAA      ROAE
             (%)         (%)       ($)      (%)     (%)       (%)    Target?     Pricing    (%)      EPS       ($)     (%)       (%)
Ticker       MRQ         MRQ       LTM      LTM     LTM       LTM      (Y/N)        Date    MRQ      (x)       MRQ     MRQ       MRQ
<S>         <C>         <C>       <C>      <C>     <C>       <C>         <C>    <C>        <C>      <C>       <C>     <C>       <C> 
CKFB        21.9        21.9      0.97     1.37    5.84      7.74        N      02/27/98   0.10     18.8      0.26    1.39      6.13
HBBI        14.1        14.1      1.09     0.72    5.48      5.70        N      02/27/98   0.67     25.7      0.22    0.61      4.32
HCFC        19.6        19.6        NA       NA      NA        NA        N      02/27/98   0.82     16.1      0.29    1.39      6.94
LONF        13.8        13.8      0.80     1.00    5.21      5.62        N      02/27/98   0.20     15.5      0.24    1.23      7.30
MIVI        18.2        18.2      0.94     1.06    6.27      6.37        N      02/27/98   0.43     19.1      0.24    1.06      6.30
NSLB        19.8        19.7      0.64     0.74    3.63      3.83        N      02/27/98   0.03     31.0      0.14    0.46      2.31
PWBK        18.0        18.0      0.86     0.98    5.28      5.14        N      02/27/98   0.74     34.4      0.16    0.70      3.85
SOBI        14.4        14.4      0.66     0.61    3.95      3.95        N      02/27/98   0.26     30.2      0.17    0.59      4.06
SSB         24.1        24.1      0.65     1.65    5.17      5.21        N      02/27/98     -      28.1      0.09    1.00      4.31
USAB         8.4         8.3      0.26     0.47    4.08      4.57        N      02/27/98   0.57     17.5      0.15    0.87      9.19
                                                                        
Maximum     24.1        24.1      1.09     1.65    6.27      7.74                          0.82     34.4      0.29    1.39      9.19
Minimum      8.4         8.3      0.26     0.47    3.63      3.83                            -      15.5      0.09    0.46      2.31
Average     17.2        17.2      0.76     0.96    4.99      5.35                          0.38     23.6      0.20    0.93      5.47
Median      18.1        18.1      0.80     0.98    5.21      5.21                          0.35     22.4      0.20    0.94      5.23
</TABLE>


Source: SNL & F&C calculations         20
<PAGE>
 
FERGUSON & COMPANY      Exhibit II.7 - Comparative Risk Characteristics

<TABLE>
<CAPTION>
                                          NPAs + Loans                                            Net Loan
                                    NPAs/  90+ Pst Due/       NPAs/    Reserves/    Reserves/   Chargeoffs/
                                   Assets       Assets       Equity        Loans         NPAs    Avg Loans
                                      (%)          (%)          (%)          (%)          (%)          (%)
Short Name                            MRQ          MRQ          MRQ          MRQ          MRQ          MRQ
<S>                                  <C>          <C>          <C>          <C>        <C>           <C>   
CKF Bancorp Inc.                     0.10         0.47         0.48         0.22       189.39         --
Home Building Bancorp                0.67         0.67         4.79         0.29        29.02         --
Home City Financial Corp.            0.82         0.82         4.16         0.73        77.27         0.08
London Financial Corp.               0.20         0.20         1.46         0.62       238.16         0.12
Mississippi View Holding Co.         0.43         0.56         2.38         1.90       290.24        (0.02)
NS&L Bancorp Inc.                    0.03         0.14         0.17         0.13       220.00           NA
Pennwood Bancorp Inc.                0.74         1.49         4.13         0.80        69.52         0.93
Sobieski Bancorp Inc.                0.26         0.26         1.82         0.29        87.34         --
Scotland Bancorp Inc.                --           --           --           0.57           NM         --
USABancshares, Inc.                  0.57         0.57         6.75         0.75        70.22         --

Maximum                              0.82         1.49         6.75         1.90       290.24         0.93
Minimum                              --           --           --           0.13        29.02        (0.02)
Average                              0.38         0.52         2.61         0.63       141.24         0.12
Median                               0.35         0.52         2.10         0.60        87.34         --
</TABLE>


Source: SNL & F&C calculations         21
<PAGE>
 
FERGUSON & COMPANY      Exhibit II.7 - Comparative Risk Characteristics

<TABLE>
<CAPTION>
                                            Intangible     One Year                Earn Assets/
                                   Loans/      Assets/     Cum Gap/           Net  Int Bearing
                                   Assets       Equity       Assets         Loans  Liabilities
                                      (%)          (%)          (%)        ($000)          (%)
Short Name                            MRQ          MRQ          MRY           MRQ          MRQ
<S>                                 <C>           <C>        <C>           <C>          <C>   
CKF Bancorp Inc.                    89.11         --             NA        55,895       129.52
Home Building Bancorp               68.17         --             NA        28,842       113.96
Home City Financial Corp.           85.94         --             NA        59,811       122.84
London Financial Corp.              76.78         --             NA        28,931       120.35
Mississippi View Holding Co.        66.10         --             NA        44,493       122.33
NS&L Bancorp Inc.                   56.71         0.70           NA        33,847       123.63
Pennwood Bancorp Inc.               64.71         --          (5.10)       30,305       118.60
Sobieski Bancorp Inc.               78.90         --             NA        68,879       112.35
Scotland Bancorp Inc.               72.79         --             NA        44,492       131.42
USABancshares, Inc.                 53.03         1.51       (13.85)       33,824       108.17

Maximum                             89.11         1.51        (5.10)       68,879       131.42
Minimum                             53.03         --         (13.85)       28,842       108.17
Average                             71.22         0.22        (9.48)       42,932       120.32
Median                              70.48         --          (9.48)       39,170       121.34
</TABLE>


Source: SNL & F&C calculations         22
<PAGE>
 
                                  EXHIBIT III
<PAGE>
 
FERGUSON & COMPANY     Exhibit III

NORTHFIELD FEDERAL SAVINGS
BALTIMORE, MD

                                                    FINANCIAL HIGHLIGHTS

                                              1994      1995      1996  YTD 9/97
                                                          ($000's)
BALANCE SHEET:
Total Assets                                30,349    32,102    32,228    35,124
% Change in Assets                            2.90      5.78      0.39      8.99
Total Loans                                 21,234    21,841    23,968    29,973
Deposits                                    27,639    29,162    29,103    30,098
Broker Originated Deposits                      --        --        --        --

CAPITAL:
Equity Capital                               2,368     2,623     2,745     2,992
Tangible Capital                             2,368     2,633     2,768     3,014
Core Capital                                 2,368     2,633     2,768     3,014
Risk-Based Capital                           2,448     2,723     2,868     3,122
Equity Capital/Total Assets                   7.80      8.17      8.52      8.52
Core Capital/Risk Based Assets               16.04     17.26     18.06     16.95
Core Capital/Adj Tang Assets                  7.80      8.20      8.58      8.58
Tangible Cap/Tangible Assets                  7.80      8.20      8.58      8.58
Risk-Based Cap/Risk-Wt Assets                16.58     17.85     18.71     17.56

PROFITABILITY:
Net Income(Loss)                               286       278       170       245
Ret on Avg Assets Bef Ext Item                0.97      0.90      0.53      0.98
Return on Average Equity                     12.87     11.30      6.32     11.43
Net Interest Income/Avg Assets                3.58      3.41      3.30      3.33
Noninterest Income/Avg Assets                 0.24      0.17      0.16      0.20
Noninterest Expense/Avg Assets                2.29      2.16      2.68      1.88
Yield/Cost Spread                             3.43      3.18      3.03      3.03

LIQUIDITY:
Int Earn Assets/Int Bear Liab               107.65    108.00    109.07    108.55
Brokered Deposits/Tot Deposits                  --        --        --        --

ASSET QUALITY:
Nonperf Lns+REO/Total Lns+REO                 0.89      0.52      0.47      0.86
Nonaccrual Loans/Gross Loans                    --        --        --        --
Nonaccrual Lns/Ln Loss Reserve                  --        --        --        --
Repos Assets/Tot Assets                         --        --        --        --
Net Chrg-Off/Av Adj Lns                         --        --        --        --
Nonmtg 1-4 Constr&Conv Lns/TA                 8.56      8.51      8.11      7.08

Source: TAFS, published by Sheshunoff   1
<PAGE>
 
FERGUSON & COMPANY     Exhibit III

NORTHFIELD FEDERAL SAVINGS
BALTIMORE, MD

                                           SELECTED PEER GROUP RATIOS & RANKINGS
                                              1994      1995      1996  YTD 9/97
Peer Group Category                              2         2         2         2

CAPITAL:
Equity Capital/Total Assets                   7.80      8.17      8.52      8.52
Peer Group Percentile                           32        30        37        32
Core Cap/Adj Tangible Assets                  7.80      8.20      8.58      8.58
Peer Group Percentile                           34        32        40        35
Tangible Cap/Tangible Assets                  7.80      8.20      8.58      8.58
Peer Group Percentile                           34        32        40        36
Risk-Based Cap/Risk-Wt Assets                16.58     17.85     18.71     17.56
Peer Group Percentile                           34        43        44        38

ASSET QUALITY:
Risk Assets/Total Assets                      8.66      8.51      8.11      7.08
Peer Group Percentile                           32        30        33        42
Risk Weighted Assts/Tot Assts                48.66     47.53     47.56     50.62
Peer Group Percentile                           47        55        57        49
Nonaccrual Loans/Gross Loans                    --        --        --        --
Peer Group Percentile                          100       100       100       100
Repos Assets/Tot Assets                         --        --        --        --
Peer Group Percentile                           36       100       100       100
90+ Day Del Loans/Gross Loans                 0.71      0.50      0.45      0.87
Peer Group Percentile                           23        33        34        22
90Day P Due+NonAccr-(1-4)/LLR                38.75    125.56    114.00        --
Peer Group Percentile                           25        10        12       100

LIQUIDITY:
Avg Reg Liquidity Ratio                      11.95     17.24     12.69      5.48
Peer Group Percentile                           34        51        45         5

PROFITABILITY:
Ret on Avg Assets Bef Ext Item                0.97      0.90      0.53      0.98
Peer Group Percentile                           66        75        70        80
Return on Equity Capital                     12.29     10.75      6.19     10.92
Peer Group Percentile                           85        88        84        90
Int Earn Assets/Int Bear Liab               107.65    108.00    109.07    108.55
Peer Group Percentile                           59        61        64        61
Yield on Earning Assts                        7.40      7.89      7.76      7.77
Peer Group Percentile                           64        61        53        52
Cost of Funds                                 3.97      4.71      4.74      4.74
Peer Group Percentile                           39        50        50        55
Yield/Cost Spread                             3.43      3.18      3.03      3.03
Peer Group Percentile                           55        58        49        48

Source: TAFS, published by Sheshunoff   2
<PAGE>
 
FERGUSON & COMPANY     Exhibit III

NORTHFIELD FEDERAL SAVINGS
BALTIMORE, MD
                                                   FINANCIAL HIGHLIGHTS

                                          12/31/96   3/31/97   6/30/97   9/30/97
                                                         ($000's)
BALANCE SHEET:
Total Assets                                32,228    33,102    33,443    35,124
% Change in Assets                            0.67      2.71      1.03      5.03
Total Loans                                 23,968    24,827    26,695    29,973
Deposits                                    29,103    29,700    29,784    30,098
Broker Originated Deposits                      --        --        --        --

CAPITAL:
Equity Capital                               2,745     2,804     2,897     2,992
Tangible Capital                             2,768     2,832     2,921     3,014
Core Capital                                 2,768     2,832     2,921     3,014
Risk-Based Capital                           2,868     2,935     3,026     3,122
Equity Capital/Total Assets                   8.52      8.47      8.66      8.52
Core Capital/Risk Based Assets               18.06     18.05     17.99     16.95
Core Capital/Adj Tang Assets                  8.58      8.55      8.73      8.58
Tangible Cap/Tangible Assets                  8.58      8.55      8.73      8.58
Risk-Based Cap/Risk-Wt Assets                18.71     18.71     18.64     17.56

PROFITABILITY:
Net Income(Loss)                                54        63        89        93
Ret on Avg Assets Bef Ext Item                0.67      0.77      1.07      1.09
Return on Average Equity                      7.95      9.08     12.49     12.63
Net Interest Income/Avg Assets                3.39      3.25      3.38      3.36
Noninterest Income/Avg Assets                 0.15      0.20      0.16      0.25
Noninterest Expense/Avg Assets                2.54      1.87      1.86      1.89
Yield/Cost Spread                             3.09      2.95      3.08      3.06

LIQUIDITY:
Int Earn Assets/Int Bear Liab               109.07    109.43    110.13    108.55
Brokered Deposits/Tot Deposits                  --        --        --        --
ASSET QUALITY:
Nonperf Lns+REO/Total Lns+REO                 0.47        --      0.30      0.86
Nonaccrual Loans/Gross Loans                    --        --        --        --
Nonaccrual Lns/Ln Loss Reserve                  --        --        --        --
Repos Assets/Tot Assets                         --        --        --        --
Net Chrg-Off/Av Adj Lns                         --        --        --        --
Nonmtg 1-4 Constr&Conv Lns/TA                 8.11      7.40      7.81      7.08

Source: TAFS, published by Sheshunoff   3
<PAGE>
 
FERGUSON & COMPANY     Exhibit III

NORTHFIELD FEDERAL SAVINGS
BALTIMORE, MD

                                           SELECTED PEER GROUP RATIOS & RANKINGS
                                          12/31/96   3/31/97   6/30/97   9/30/97
Peer Group Category                              2         2         2         2

CAPITAL:
Equity Capital/Total Assets                   8.52      8.47      8.66      8.52
Peer Group Percentile                           37        35        37        32
Core Cap/Adj Tangible Assets                  8.58      8.55      8.73      8.58
Peer Group Percentile                           40        37        40        35
Tangible Cap/Tangible Assets                  8.58      8.55      8.73      8.58
Peer Group Percentile                           40        37        40        36
Risk-Based Cap/Risk-Wt Assets                18.71     18.71     18.64     17.56
Peer Group Percentile                           44        45        45        38

ASSET QUALITY:
Risk Assets/Total Assets                      8.11      7.40      7.81      7.08
Peer Group Percentile                           33        37        35        42
Risk Weighted Assts/Tot Assts                47.56     47.39     48.55     50.62
Peer Group Percentile                           57        59        56        49
Nonaccrual Loans/Gross Loans                    --        --        --        --
Peer Group Percentile                          100       100       100       100
Repos Assets/Tot Assets                         --        --        --        --
Peer Group Percentile                          100       100       100       100
90+ Day Del Loans/Gross Loans                 0.45        --      0.30      0.87
Peer Group Percentile                           34       100        39        22
90Day P Due+NonAccr-(1-4)/LLR               114.00        --        --        --
Peer Group Percentile                           12       100       100       100

LIQUIDITY:
Avg Reg Liquidity Ratio                      12.69     12.94      8.32      5.48
Peer Group Percentile                           45        43        20         5

PROFITABILITY:
Ret on Avg Assets Bef Ext Item                0.67      0.77      1.07      1.09
Peer Group Percentile                        43.00     51.00     83.00     84.00
Return on Equity Capital                      7.87      8.99     12.29     12.43
Peer Group Percentile                           57        69        90        91
Int Earn Assets/Int Bear Liab               109.07    109.43    110.13    108.55
Peer Group Percentile                           64        67        67        61
Yield on Earning Assts                        7.85      7.63      7.79      7.89
Peer Group Percentile                           55        44        52        57
Cost of Funds                                 4.76      4.68      4.71      4.83
Peer Group Percentile                           50        53        58        52
Yield/Cost Spread                             3.09      2.95      3.08      3.06
Peer Group Percentile                           50        45        49        52


Source: TAFS, published by Sheshunoff   4
<PAGE>
 
                                   EXHIBIT IV
<PAGE>
 
FERGUSON & COMPANY     Exhibit IV

CENTRAL KENTUCKY FSB
DANVILLE, KY
TICKER CKFB 
                                                FINANCIAL HIGHLIGHTS

                                    1994         1995        1996     YTD 9/97
                                                     ($000'S)
BALANCE SHEET:
Total Assets                      56,377       56,545      60,014       59,868
% Change in Assets                 12.64         0.30        6.13        (0.24)
Total Loans                       45,441       49,997      53,544       55,580
Deposits                          44,273       43,126      44,762       43,840
Broker Originated Deposits            --           --          --           --

CAPITAL:
Equity Capital                    11,290       12,295      12,431       12,308
Tangible Capital                  10,989       11,781      11,967       12,004
Core Capital                      10,989       11,781      11,967       12,004
Risk-Based Capital                11,065       11,881      12,074       12,123
Equity Capital/Total Assets        20.03        21.74       20.71        20.56
Core Capital/Risk Based Assets     39.04        33.63       35.07        34.22
Core Capital/Adj Tang Assets       19.65        21.03       20.10        20.15
Tangible Cap/Tangible Assets       19.65        21.03       20.10        20.15
Risk-Based Cap/Risk-Wt Assets      39.31        33.92       35.38        34.56

PROFITABILITY:
Net Income(Loss)                     542          764         827          927
Ret on Avg Assets Bef Ext Item      1.02         1.35        1.40         2.05
Return on Average Equity            6.39         6.48        6.55         9.73
Net Interest Income/Avg Assets      2.98         3.83        3.71         3.73
Noninterest Income/Avg Assets       0.16         0.16        0.65         1.12
Noninterest Expense/Avg Assets      1.60         1.87        2.27         1.67
Yield/Cost Spread                   2.46         3.08        2.87         2.79

LIQUIDITY:
Int Earn Assets/Int Bear Liab     123.66       125.92      123.97       124.12
Brokered Deposits/Tot Deposits        --           --          --           --

ASSET QUALITY:
Nonperf Lns+REO/Total Lns+REO       1.48         1.09        1.25         1.29
Nonaccrual Loans/Gross Loans          --         0.00        0.16         0.26
Nonaccrual Lns/Ln Loss Reserve        --         2.00       81.31       122.69
Repos Assets/Tot Assets               --           --          --           --
Net Chrg-Off/Av Adj Lns               --           --          --         0.14
Nonmtg 1-4 Constr&Conv Lns/TA      10.51        13.09       12.79        14.05

Source: TAFS, published by Sheshunoff   1
<PAGE>
 
FERGUSON & COMPANY     Exhibit IV

HOME BUILDING SVGS BK FSB
WASHINGTON, IN
TICKER HBBI
                                                FINANCIAL HIGHLIGHTS

                                    1994         1995        1996     YTD 9/97
                                                     ($000'S)
BALANCE SHEET:
Total Assets                      42,107       42,796      44,337       41,488
% Change in Assets                 (1.66)        1.64        3.60        (6.43)
Total Loans                       29,944       29,177      28,500       28,725
Deposits                          36,629       33,283      35,589       32,511
Broker Originated Deposits            --           --          --           --

CAPITAL:
Equity Capital                     3,090        4,639       4,335        4,475
Tangible Capital                   3,090        4,611       4,338        4,463
Core Capital                       3,090        4,611       4,338        4,463
Risk-Based Capital                 3,167        4,688       4,417        4,544
Equity Capital/Total Assets         7.34        10.84        9.78        10.79
Core Capital/Risk Based Assets     13.65        20.99       20.19        21.04
Core Capital/Adj Tang Assets        7.35        10.79        9.78        10.76
Tangible Cap/Tangible Assets        7.35        10.79        9.78        10.76
Risk-Based Cap/Risk-Wt Assets      13.99        21.35       20.56        21.42

PROFITABILITY:
Net Income(Loss)                     327          421        (138)         273
Ret on Avg Assets Bef Ext Item      0.77         0.99       (0.32)        0.81
Return on Average Equity           11.11        10.89       (3.15)        8.22
Net Interest Income/Avg Assets      3.21         3.40        3.18         3.23
Noninterest Income/Avg Assets       0.24         0.38        0.34         0.36
Noninterest Expense/Avg Assets      2.10         2.22        2.86         2.25
Yield/Cost Spread                   3.32         3.45        3.18         3.24

LIQUIDITY:
Int Earn Assets/Int Bear Liab     102.72       105.49      103.42       105.49
Brokered Deposits/Tot Deposits        --           --          --           --

ASSET QUALITY:
Nonperf Lns+REO/Total Lns+REO       0.68         0.32        1.60         0.87
Nonaccrual Loans/Gross Loans        0.67         0.20        1.59         0.64
Nonaccrual Lns/Ln Loss Reserve    263.64        77.92      577.22       224.69
Repos Assets/Tot Assets               --           --          --           --
Net Chrg-Off/Av Adj Lns             0.03           --        1.44         0.01
Nonmtg 1-4 Constr&Conv Lns/TA       0.53         0.81        0.69         1.28

Source: TAFS, published by Sheshunoff   2
<PAGE>
 
FERGUSON & COMPANY     Exhibit IV

HOME CITY FSB OF SPRINGFIELD
SPRINGFIELD, OH
TICKER HCFC 
                                                FINANCIAL HIGHLIGHTS

                                    1994         1995        1996     YTD 9/97
                                                     ($000'S)
BALANCE SHEET:
Total Assets                      45,622       53,225      68,370       69,713
% Change in Assets                 12.81        16.67       28.45         1.96
Total Loans                       35,698       44,014      50,835       60,143
Deposits                          37,857       45,021      53,458       53,891
Broker Originated Deposits            --           --          --           --

CAPITAL:
Equity Capital                     4,548        5,179      10,225       10,863
Tangible Capital                   4,513        4,954       9,955       10,544
Core Capital                       4,513        4,954       9,955       10,544
Risk-Based Capital                 4,779        5,266      10,355       10,987
Equity Capital/Total Assets         9.97         9.73       14.96        15.58
Core Capital/Risk Based Assets     18.72        17.68       28.47        25.50
Core Capital/Adj Tang Assets        9.89         9.35       14.62        15.19
Tangible Cap/Tangible Assets        9.89         9.35       14.62        15.19
Risk-Based Cap/Risk-Wt Assets      19.82        18.79       29.61        26.57

PROFITABILITY:
Net Income(Loss)                     621          537         495          585
Ret on Avg Assets Bef Ext Item      1.44         1.09        0.86         1.16
Return on Average Equity           14.82        11.08        8.31         7.42
Net Interest Income/Avg Assets      4.48         3.46        3.16         3.49
Noninterest Income/Avg Assets       0.48         0.69        0.92         0.45
Noninterest Expense/Avg Assets      2.48         2.47        2.81         2.19
Yield/Cost Spread                   4.30         3.23        2.96         2.95

LIQUIDITY:
Int Earn Assets/Int Bear Liab     108.60       106.21      113.47       113.26
Brokered Deposits/Tot Deposits        --           --          --           --

ASSET QUALITY:
Nonperf Lns+REO/Total Lns+REO       0.28         0.52        0.45         0.94
Nonaccrual Loans/Gross Loans        0.26         0.49        0.43         0.95
Nonaccrual Lns/Ln Loss Reserve     24.82        53.76       45.36       129.12
Repos Assets/Tot Assets               --           --          --           --
Net Chrg-Off/Av Adj Lns               --         0.04        0.01           --
Nonmtg 1-4 Constr&Conv Lns/TA      24.25        23.30       19.22        21.28

Source: TAFS, published by Sheshunoff   3
<PAGE>
 
FERGUSON & COMPANY     Exhibit IV

CITIZENS L&SC
LONDON, OH
TICKER LONF
                                                FINANCIAL HIGHLIGHTS

                                    1994         1995        1996     YTD 9/97
                                                     ($000'S)
BALANCE SHEET:
Total Assets                      32,226       34,615      35,289       36,778
% Change in Assets                  4.24         7.41        1.95         4.22
Total Loans                       26,717       27,877      28,003       29,628
Deposits                          28,754       30,989      28,795       29,951
Broker Originated Deposits            --           --          --           --

CAPITAL:
Equity Capital                     3,123        3,267       5,524        5,817
Tangible Capital                   3,123        3,267       5,524        5,817
Core Capital                       3,123        3,267       5,524        5,817
Risk-Based Capital                 3,315        3,454       5,712        6,005
Equity Capital/Total Assets         9.69         9.44       15.65        15.82
Core Capital/Risk Based Assets     18.01        18.11       28.82        29.78
Core Capital/Adj Tang Assets        9.69         9.44       15.65        15.82
Tangible Cap/Tangible Assets        9.69         9.44       15.65        15.82
Risk-Based Cap/Risk-Wt Assets      19.12        19.15       29.80        30.75

PROFITABILITY:
Net Income(Loss)                     244          144         225          293
Ret on Avg Assets Bef Ext Item      0.77         0.43        0.64         1.07
Return on Average Equity            8.13         4.51        4.18         6.88
Net Interest Income/Avg Assets      3.28         2.87        3.51         3.51
Noninterest Income/Avg Assets       0.25         0.24        0.21         0.22
Noninterest Expense/Avg Assets      2.38         2.43        2.78         2.16
Yield/Cost Spread                   3.10         2.61        2.94         2.92

LIQUIDITY:
Int Earn Assets/Int Bear Liab     107.79       107.36      116.24       116.20
Brokered Deposits/Tot Deposits        --           --          --           --

ASSET QUALITY:
Nonperf Lns+REO/Total Lns+REO       0.09         0.16        1.06         0.90
Nonaccrual Loans/Gross Loans        0.08         0.16        1.00         0.88
Nonaccrual Lns/Ln Loss Reserve     11.46        24.06      159.04       138.83
Repos Assets/Tot Assets               --           --          --           --
Net Chrg-Off/Av Adj Lns               --         0.02       (0.00)          --
Nonmtg 1-4 Constr&Conv Lns/TA      16.87        15.78       14.37        14.14

Source: TAFS, published by Sheshunoff   4
<PAGE>
 
FERGUSON & COMPANY     Exhibit IV

COMMUNITY FS&LA
LITTLE FALLS, MN
TICKER MIVI
                                                FINANCIAL HIGHLIGHTS

                                    1994         1995        1996     YTD 9/97
                                                     ($000'S)
BALANCE SHEET:
Total Assets                      62,111       69,212      70,306       68,547
% Change in Assets                 (4.36)       11.43        1.58        (2.50)
Total Loans                       44,310       43,438      44,095       44,858
Deposits                          55,312       54,689      56,426       55,212
Broker Originated Deposits            --           --          --           --

CAPITAL:
Equity Capital                     6,137       10,912      11,504       11,998
Tangible Capital                   6,043       10,692      10,639       10,886
Core Capital                       6,043       10,692      10,639       10,886
Risk-Based Capital                 6,419       11,092      11,068       11,318
Equity Capital/Total Assets         9.88        15.77       16.36        17.50
Core Capital/Risk Based Assets     18.90        32.13       31.25        31.91
Core Capital/Adj Tang Assets        9.74        15.50       15.32        16.32
Tangible Cap/Tangible Assets        9.74        15.50       15.32        16.32
Risk-Based Cap/Risk-Wt Assets      20.08        33.33       32.51        33.17

PROFITABILITY:
Net Income(Loss)                     414          837         520          646
Ret on Avg Assets Bef Ext Item      0.65         1.27        0.74         1.24
Return on Average Equity            7.03         9.82        4.81         7.34
Net Interest Income/Avg Assets      3.40         3.80        3.47         3.64
Noninterest Income/Avg Assets       0.40         0.55        0.43         0.42
Noninterest Expense/Avg Assets      2.40         2.26        2.70         2.00
Yield/Cost Spread                   3.23         3.47        2.94         3.01

LIQUIDITY:
Int Earn Assets/Int Bear Liab     108.61       115.61      118.25       119.16
Brokered Deposits/Tot Deposits        --           --          --           --

ASSET QUALITY:
Nonperf Lns+REO/Total Lns+REO       0.09         0.22        0.59         0.51
Nonaccrual Loans/Gross Loans        0.05           --        0.38         0.44
Nonaccrual Lns/Ln Loss Reserve      2.06           --       19.73        23.11
Repos Assets/Tot Assets               --           --          --           --
Net Chrg-Off/Av Adj Lns            (0.03)        0.33        0.02         0.04
Nonmtg 1-4 Constr&Conv Lns/TA       5.96         2.47        2.85         2.43

Source: TAFS, published by Sheshunoff   5
<PAGE>
 
FERGUSON & COMPANY     Exhibit IV

NEOSHO S&LA, FA
NEOSHO, MO
TICKER NSLB
                                                FINANCIAL HIGHLIGHTS

                                    1994         1995        1996     YTD 9/97
                                                     ($000'S)
BALANCE SHEET:
Total Assets                      49,738       53,156      56,645       59,066
% Change in Assets                 (4.49)        6.87        6.56         4.27
Total Loans                       25,095       28,013      31,762       34,056
Deposits                          43,274       41,964      44,062       45,631
Broker Originated Deposits            --           --          --           --

CAPITAL:
Equity Capital                     6,018        9,947       8,339        8,876
Tangible Capital                   6,018        9,947       8,339        8,793
Core Capital                       6,018        9,947       8,339        8,793
Risk-Based Capital                 6,036        9,945       8,381        8,837
Equity Capital/Total Assets        12.10        18.71       14.72        15.03
Core Capital/Risk Based Assets     34.70        51.58       38.31        34.63
Core Capital/Adj Tang Assets       12.10        18.71       14.72        14.91
Tangible Cap/Tangible Assets       12.10        18.71       14.72        14.91
Risk-Based Cap/Risk-Wt Assets      34.81        51.57       38.50        34.81

PROFITABILITY:
Net Income(Loss)                     471          471         186          289
Ret on Avg Assets Bef Ext Item      0.93         0.92        0.33         0.67
Return on Average Equity            8.16         5.90        1.97         4.49
Net Interest Income/Avg Assets      3.04         3.06        2.80         2.95
Noninterest Income/Avg Assets       0.59         0.54        0.43         0.42
Noninterest Expense/Avg Assets      2.17         2.32        2.79         2.38
Yield/Cost Spread                   2.94         2.70        2.32         2.54

LIQUIDITY:
Int Earn Assets/Int Bear Liab     110.37       119.53      114.10       114.72
Brokered Deposits/Tot Deposits        --           --          --           --

ASSET QUALITY:
Nonperf Lns+REO/Total Lns+REO       0.04         0.12        0.14         0.06
Nonaccrual Loans/Gross Loans          --         0.12        0.14         0.06
Nonaccrual Lns/Ln Loss Reserve        --        89.74      107.14        45.45
Repos Assets/Tot Assets               --           --          --           --
Net Chrg-Off/Av Adj Lns               --        (0.02)         --           --
Nonmtg 1-4 Constr&Conv Lns/TA       0.42         0.33        0.20         0.99

Source: TAFS, published by Sheshunoff   6
<PAGE>
 
FERGUSON & COMPANY     Exhibit IV

PENNWOOD SVGS BK
PITTSBURGH, PA
TICKER PWBK
                                                FINANCIAL HIGHLIGHTS

                                    1994         1995        1996     YTD 9/97
                                                     ($000'S)
BALANCE SHEET:
Total Assets                      40,464       41,592      46,707       47,546
% Change in Assets                 (2.18)        2.79       12.30         1.80
Securities-Book Value              5,123       11,765      18,306       13,320
Securities-Fair Value              5,030       11,811      18,318       13,328
Total Loans & Leases              25,349       23,321      21,515       28,962
Total Deposits                    36,131       36,899      35,227       36,740
Loan/Deposit Ratio                    70           63          61           79
Provision for Loan Losses            136          426          67           36

CAPITAL:
Equity Capital                     3,877        4,065       9,378        8,645
Total Qualifying Capital(Est)      4,155        4,339       9,679        8,883
Equity Capital/Average Assets       9.48         9.91       21.19        18.04
Tot Qual Cap/Rk Bsd Asts(Est)      16.04        17.20       39.70        34.17
Tier 1 Cap/Rsk Bsed Asts(Est)      14.79        15.95       38.45        33.02
T1 Cap/Avg Assets(Lev Est)          9.37         9.61       20.14        17.51
Dividends Declared/Net Income         --           --       19.55       419.75

PROFITABILITY:
Net Income(Loss)                     168          192         220          405
Return on Average Assets            0.41         0.47        0.50         1.13
Return on Average Equity Cap        4.46         4.84        3.65         5.93
Net Interest Margin                 3.63         4.38        4.32         4.57
Net Int Income/Avg Assets           3.53         4.16        4.11         4.31
Noninterest Income/Avg Assets       0.23         0.06        0.18         0.18
Noninterest Exp/Avg Assets          3.09         2.77        3.42         2.80

ASSET QUALITY:
NPL+Frcl RE/Lns+Frcl RE             5.55         5.30        2.85         2.45
NPA's/Equity + LLR                 33.20        27.40        6.37         7.94
LLR/Nonperf & Restrcd Lns          28.51        44.59       62.50        44.73
Foreclosed RE/Total Assets          0.23         0.42        0.28         0.08
90+ Day Del Loans/Total Loans       0.45         1.05        0.81         0.91
Loan Loss Reserves/Total Lns        1.48         2.05        1.42         1.04
Net Charge-Offs/Average Loans       0.37         1.33        1.07         0.16
Dom Risk R/E Lns/Tot Dom Lns       20.76        20.31       19.96        11.94

LIQUIDITY:
Brokered Dep/Total Dom Deps           --           --          --           --
$100M+ Time Dep/Total Dom Dep       3.95         4.98        4.64         6.19
Int Earn Assets/Int Bear Liab     108.99       108.22      124.73       124.42
Pledged Sec/Total Sec                 --           --          --           --
Fair Value Sec/Amort Cost Sec      99.54       100.95      100.10       100.78


Source: BankSource, published by Sheshunoff


                                       7
<PAGE>
 
FERGUSON & COMPANY     Exhibit IV

SOBIESKI FS&LA
SOUTH BEND, IN
TICKER SOBI
                                                FINANCIAL HIGHLIGHTS

                                    1994         1995        1996     YTD 9/97
                                                     ($000'S)
BALANCE SHEET:
Total Assets                      70,694       72,595      75,773       81,969
% Change in Assets                 (4.11)        2.69        4.38         8.18
Total Loans                       49,594       45,893      52,234       60,427
Deposits                          64,309       61,399      59,714       58,645
Broker Originated Deposits            --           --          --           --

CAPITAL:
Equity Capital                     5,917       10,002       9,321        9,139
Tangible Capital                   5,917        9,964       9,331        9,136
Core Capital                       5,917        9,964       9,331        9,136
Risk-Based Capital                 6,117       10,164       9,531        9,336
Equity Capital/Total Assets         8.37        13.78       12.30        11.15
Core Capital/Risk Based Assets     19.89        35.15       29.37        23.88
Core Capital/Adj Tang Assets        8.37        13.73       12.31        11.15
Tangible Cap/Tangible Assets        8.37        13.73       12.31        11.15
Risk-Based Cap/Risk-Wt Assets      20.56        35.86       30.00        24.40

PROFITABILITY:
Net Income(Loss)                     686          363          74          326
Ret on Avg Assets Bef Ext Item      0.95         0.57        0.10         0.56
Return on Average Equity           12.25         5.09        0.76         4.82
Net Interest Income/Avg Assets      3.53         3.02        2.92         2.99
Noninterest Income/Avg Assets       0.22         0.23        0.37         0.26
Noninterest Expense/Avg Assets      2.20         2.40        3.08         2.25
Yield/Cost Spread                   3.45         2.84        2.69         2.83

LIQUIDITY:
Int Earn Assets/Int Bear Liab     105.04       109.97      107.58       107.37
Brokered Deposits/Tot Deposits        --           --          --           --

ASSET QUALITY:
Nonperf Lns+REO/Total Lns+REO       0.30         0.17        0.38         0.17
Nonaccrual Loans/Gross Loans          --           --          --         0.18
Nonaccrual Lns/Ln Loss Reserve        --           --          --        53.00
Repos Assets/Tot Assets               --           --          --           --
Net Chrg-Off/Av Adj Lns               --           --          --           --
Nonmtg 1-4 Constr&Conv Lns/TA       0.50         3.57        4.53         1.92

Source: TAFS, published by Sheshunoff   8
<PAGE>
 
FERGUSON & COMPANY     Exhibit IV

SCOTLAND SVGS BK
LAURINBURG, NC
TICKER SSB
                                                FINANCIAL HIGHLIGHTS

                                    1994         1995        1996     YTD 9/97
                                                     ($000'S)
BALANCE SHEET:
Total Assets                      57,740       58,049      60,714       63,826
% Change in Assets                  4.30         0.54        4.59         5.13
Securities-Book Value             14,250       11,806      11,018        9,979
Securities-Fair Value             14,086       11,912      11,081       10,037
Total Loans & Leases              37,296       42,003      46,305       46,712
Total Deposits                    49,124       48,346      42,432       44,028
Loan/Deposit Ratio                    76           87         109          106
Provision for Loan Losses             25           12          24           18

CAPITAL:
Equity Capital                     7,921        8,860      17,136       18,705
Total Qualifying Capital(Est)      7,897        8,609      16,834       18,380
Equity Capital/Average Assets      14.01        15.30       26.95        30.02
Tot Qual Cap/Rk Bsd Asts(Est)      30.02        30.65       57.41        54.81
Tier 1 Cap/Rsk Bsed Asts(Est)      29.25        29.89       56.62        54.06
T1 Cap/Avg Assets(Lev Est)         13.05        14.11       27.12        28.57
Dividends Declared/Net Income         --           --       30.14        36.99

PROFITABILITY:
Net Income(Loss)                     577          700         647          665
Return on Average Assets            1.02         1.21        1.02         1.42
Return on Average Equity Cap        7.69         8.34        4.08         4.95
Net Interest Margin                 3.89         3.82        4.30         4.66
Net Int Income/Avg Assets           3.82         3.73        4.11         4.41
Noninterest Income/Avg Assets       0.27         0.11        0.09         0.08
Noninterest Exp/Avg Assets          2.44         1.96        2.58         2.84

ASSET QUALITY:
NPL+Frcl RE/Lns+Frcl RE               --           --        0.07         0.06
NPA's/Equity + LLR                    --           --        0.18         0.16
LLR/Nonperf & Restrcd Lns             --           --      745.16       830.00
Foreclosed RE/Total Assets            --           --          --           --
90+ Day Del Loans/Total Loans         --           --        0.07         0.06
Loan Loss Reserves/Total Lns        0.54         0.51        0.50         0.53
Net Charge-Offs/Average Loans         --           --        0.02           --
Dom Risk R/E Lns/Tot Dom Lns        7.58         6.59        6.50         5.52

LIQUIDITY:
Brokered Dep/Total Dom Deps           --           --          --           --
$100M+ Time Dep/Total Dom Dep       7.36         8.60        6.66         6.15
Int Earn Assets/Int Bear Liab     115.85       118.12      142.09       142.82
Pledged Sec/Total Sec               2.55         6.02        5.95         6.95
Fair Value Sec/Amort Cost Sec     101.29       107.31      108.53       109.79

Source: BankSource, published by Sheshunoff


                                       9
<PAGE>
 
FERGUSON & COMPANY     Exhibit IV

PEOPLES-THRIFT SVGS BK
NORRISTOWN, PA
TICKER USAB
                                                FINANCIAL HIGHLIGHTS

                                    1994         1995        1996     YTD 9/97
                                                     ($000'S)
BALANCE SHEET:
Total Assets                      19,141       25,236      38,033       63,698
% Change in Assets                 (6.35)       31.84       50.71        67.48
Securities-Book Value             15,100       10,083      16,448       26,413
Securities-Fair Value             13,992       10,139      16,452       26,563
Total Loans & Leases               3,248        7,057      16,711       34,082
Total Deposits                    17,051       20,943      27,974       46,195
Loan/Deposit Ratio                    19           34          60           74
Provision for Loan Losses            -16           51         125           75

CAPITAL:
Equity Capital                     1,507        4,025       4,785        5,000
Total Qualifying Capital(Est)      1,516        3,883       4,776        5,107
Equity Capital/Average Assets       7.62        18.14       16.16        10.90
Tot Qual Cap/Rk Bsd Asts(Est)      29.48        47.93       26.12        11.16
Tier 1 Cap/Rsk Bsed Asts(Est)      29.30        47.19       25.11        10.60
T1 Cap/Avg Assets(Lev Est)          7.91        15.12       13.33         8.71
Dividends Declared/Net Income      (0.00)       (0.00)         --           --

PROFITABILITY:
Net Income(Loss)                     (44)        (176)        297          318
Return on Average Assets           (0.22)       (0.79)       1.00         0.92
Return on Average Equity Cap       (2.92)       (6.36)       6.60         8.87
Net Interest Margin                 2.33         2.00        5.98         4.81
Net Int Income/Avg Assets           2.30         1.98        5.83         4.63
Noninterest Income/Avg Assets       0.06         0.03        0.17         0.15
Noninterest Exp/Avg Assets          2.63         2.59        4.65         3.29

ASSET QUALITY:
NPL+Frcl RE/Lns+Frcl RE               --           --        2.18         1.09
NPA's/Equity + LLR                    --           --        7.35         7.04
LLR/Nonperf & Restrcd Lns             --           --       49.86        69.46
Foreclosed RE/Total Assets            --           --          --           --
90+ Day Del Loans/Total Loans         --           --        0.28         0.01
Loan Loss Reserves/Total Lns        0.28         0.85        1.09         0.75
Net Charge-Offs/Average Loans         --           --        0.02           --
Dom Risk R/E Lns/Tot Dom Lns          --         3.54       23.74        65.73

LIQUIDITY:
Brokered Dep/Total Dom Deps           --           --          --           --
$100M+ Time Dep/Total Dom Dep       5.06         8.48        8.98         8.97
Int Earn Assets/Int Bear Liab     107.04       118.19      113.59       106.53
Pledged Sec/Total Sec                 --           --          --           --
Fair Value Sec/Amort Cost Sec      92.66       100.81      100.22       101.02

Source: BankSource, published by Sheshunoff


                                       10
<PAGE>
 
                                   EXHIBIT V
<PAGE>
 
FERGUSON & COMPANY      Exhibit V - Selected Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                            Deposit                             Current    Current
                                                                          Insurance                               Stock     Market
                                                                             Agency                               Price      Value
Ticker    Short Name                      City              State Region (BIF/SAIF) Exchange        IPO Date        ($)       ($M)
<S>       <C>                             <C>                  <C>  <C>    <C>       <C>            <C>          <C>      <C>
AABC      Access Anytime Bancorp Inc.     Clovis               NM   SW     SAIF      NASDAQ         08/08/86     10.875      12.97
ABBK      Abington Bancorp Inc.           Abington             MA   NE     BIF       NASDAQ         06/10/86     21.000      76.38
ABCL      Alliance Bancorp Inc.           Hinsdale             IL   MW     SAIF      NASDAQ         07/07/92     27.500     220.61
ABCW      Anchor BanCorp Wisconsin        Madison              WI   MW     SAIF      NASDAQ         07/16/92     43.000     389.23
AFED      AFSALA Bancorp Inc.             Amsterdam            NY   MA     SAIF      NASDAQ         10/01/96     19.625      27.05
AHM       H.F. Ahmanson & Co.             Irwindale            CA   WE     SAIF      NYSE           10/25/72     62.438   6,796.38
ALBC      Albion Banc Corp.               Albion               NY   MA     SAIF      NASDAQ         07/26/93     10.750       8.06
ALBK      ALBANK Financial Corp.          Albany               NY   MA     SAIF      NASDAQ         04/01/92     48.625     627.60
AMFC      AMB Financial Corp.             Munster              IN   MW     SAIF      NASDAQ         04/01/96     17.125      16.51
ANA       Acadiana Bancshares Inc.        Lafayette            LA   SW     SAIF      AMSE           07/16/96     22.125      58.78
ANDB      Andover Bancorp Inc.            Andover              MA   NE     BIF       NASDAQ         05/08/86     39.875     206.08
ANE       Alliance Bncp of New England    Vernon               CT   NE     BIF       AMSE           12/19/86     19.875      32.52
ASBI      Ameriana Bancorp                New Castle           IN   MW     SAIF      NASDAQ         03/02/87     20.500      66.24
ASBP      ASB Financial Corp.             Portsmouth           OH   MW     SAIF      NASDAQ         05/11/95     13.750      22.49
ASFC      Astoria Financial Corp.         Lake Success         NY   MA     SAIF      NASDAQ         11/18/93     55.875   1,463.80
BANC      BankAtlantic Bancorp Inc.       Fort Lauderdale      FL   SE     SAIF      NASDAQ         11/29/83     13.500     341.17
BDJI      First Federal Bancorp.          Bemidji              MN   MW     SAIF      NASDAQ         04/04/95     20.750      20.71
BFD       BostonFed Bancorp Inc.          Burlington           MA   NE     SAIF      AMSE           10/24/95     22.125     122.14
BFSB      Bedford Bancshares Inc.         Bedford              VA   SE     SAIF      NASDAQ         08/22/94     28.500      32.56
BKC       American Bank of Connecticut    Waterbury            CT   NE     BIF       AMSE           12/01/81     50.250     116.63
BKCT      Bancorp Connecticut Inc.        Southington          CT   NE     BIF       NASDAQ         07/03/86     18.500      94.20
BKUNA     BankUnited Financial Corp.      Coral Gables         FL   SE     SAIF      NASDAQ         12/11/85     14.688     208.70
BNKU      Bank United Corp.               Houston              TX   SW     SAIF      NASDAQ         08/09/96     47.125   1,488.94
BPLS      Bank Plus Corp.                 Los Angeles          CA   WE     SAIF      NASDAQ               NA     14.750     285.67
BVCC      Bay View Capital Corp.          San Mateo            CA   WE     SAIF      NASDAQ         05/09/86     34.750     700.12
BYFC      Broadway Financial Corp.        Los Angeles          CA   WE     SAIF      NASDAQ         01/09/96     12.750      11.01
CAFI      Camco Financial Corp.           Cambridge            OH   MW     SAIF      NASDAQ               NA     25.375      81.63
CASB      Cascade Financial Corp.         Everett              WA   WE     SAIF      NASDAQ         09/16/92     15.500      52.62
CASH      First Midwest Financial Inc.    Storm Lake           IA   MW     SAIF      NASDAQ         09/20/93     22.875      61.58
CATB      Catskill Financial Corp.        Catskill             NY   MA     BIF       NASDAQ         04/18/96     18.375      85.08
CBCI      Calumet Bancorp Inc.            Dolton               IL   MW     SAIF      NASDAQ         02/20/92     37.500     117.81
CBES      CBES Bancorp Inc.               Excelsior Springs    MO   MW     SAIF      NASDAQ         09/30/96     25.500      25.83
CBSA      Coastal Bancorp Inc.            Houston              TX   SW     SAIF      NASDAQ               NA     31.313     156.84
CEBK      Central Co-operative Bank       Somerville           MA   NE     BIF       NASDAQ         10/24/86     32.000      62.88
CENB      Century Bancorp Inc.            Thomasville          NC   SE     SAIF      NASDAQ         12/23/96     93.750      38.19
CFB       Commercial Federal Corp.        Omaha                NE   MW     SAIF      NYSE           12/31/84     35.375   1,332.09
CFCP      Coastal Financial Corp.         Myrtle Beach         SC   SE     SAIF      NASDAQ         09/26/90     21.750     101.66
CFFC      Community Financial Corp.       Staunton             VA   SE     SAIF      NASDAQ         03/30/88     30.750      39.27
CFNC      Carolina Fincorp Inc.           Rockingham           NC   SE     SAIF      NASDAQ         11/25/96     17.750      33.82
CFSB      CFSB Bancorp Inc.               Lansing              MI   MW     SAIF      NASDAQ         06/22/90     29.500     224.42
CFTP      Community Federal Bancorp       Tupelo               MS   SE     SAIF      NASDAQ         03/26/96     18.688      86.50
CIBI      Community Investors Bancorp     Bucyrus              OH   MW     SAIF      NASDAQ         02/07/95     17.250      15.57
CKFB      CKF Bancorp Inc.                Danville             KY   MW     SAIF      NASDAQ         01/04/95     19.500      16.91
CLAS      Classic Bancshares Inc.         Ashland              KY   MW     SAIF      NASDAQ         12/29/95     18.875      24.54
CMRN      Cameron Financial Corp          Cameron              MO   MW     SAIF      NASDAQ         04/03/95     20.000      51.29
CMSB      Commonwealth Bancorp Inc.       Norristown           PA   MA     SAIF      NASDAQ         06/17/96     20.375     331.04
CNIT      CENIT Bancorp Inc.              Norfolk              VA   SE     SAIF      NASDAQ         08/06/92     71.250     112.17
COFI      Charter One Financial           Cleveland            OH   MW     SAIF      NASDAQ         01/22/88     60.594   3,868.86
COOP      Cooperative Bankshares Inc.     Wilmington           NC   SE     SAIF      NASDAQ         08/21/91     20.250      60.43
CRZY      Crazy Woman Creek Bancorp       Buffalo              WY   WE     SAIF      NASDAQ         03/29/96     16.500      15.75
CVAL      Chester Valley Bancorp Inc.     Downingtown          PA   MA     SAIF      NASDAQ         03/27/87     31.750      69.14
DCBI      Delphos Citizens Bancorp Inc.   Delphos              OH   MW     SAIF      NASDAQ         11/21/96     24.250      47.18
DIBK      Dime Financial Corp.            Wallingford          CT   NE     BIF       NASDAQ         07/09/86     31.250     161.38
DIME      Dime Community Bancorp Inc.     Brooklyn             NY   MA     BIF       NASDAQ         06/26/96     25.125     312.51
DME       Dime Bancorp Inc.               New York             NY   MA     BIF       NYSE           08/19/86     30.500   3,548.92
DNFC      D & N Financial Corp.           Hancock              MI   MW     SAIF      NASDAQ         02/13/85     26.250     238.85
DSL       Downey Financial Corp.          Newport Beach        CA   WE     SAIF      NYSE           01/01/71     29.250     782.61
</TABLE>

Source: SNL & F&C calculations          1
<PAGE>
 
FERGUSON & COMPANY      Exhibit V - Selected Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                          Deposit                               Current    Current
                                                                          Insurance                               Stock     Market
                                                                          Agency                                  Price      Value
Ticker    Short Name                      City               State Region (BIF/SAIF) Exchange       IPO Date        ($)       ($M)
<S>       <C>                             <C>                  <C>  <C>    <C>       <C>            <C>          <C>      <C>
EBSI      Eagle Bancshares                Tucker               GA   SE     SAIF      NASDAQ         04/01/86     20.500     117.23
EFBI      Enterprise Federal Bancorp      West Chester         OH   MW     SAIF      NASDAQ         10/17/94     33.375      66.28
EMLD      Emerald Financial Corp.         Strongsville         OH   MW     SAIF      NASDAQ               NA     22.125     112.23
EQSB      Equitable Federal Savings Bank  Wheaton              MD   MA     SAIF      NASDAQ         09/10/93     30.500      37.11
ESBK      Elmira Savings Bank (The)       Elmira               NY   MA     BIF       NASDAQ         03/01/85     28.875      21.42
ETFS      East Texas Financial Services   Tyler                TX   SW     SAIF      NASDAQ         01/10/95     21.750      22.32
FBBC      First Bell Bancorp Inc.         Pittsburgh           PA   MA     SAIF      NASDAQ         06/29/95     18.750     122.07
FBCI      Fidelity Bancorp Inc.           Chicago              IL   MW     SAIF      NASDAQ         12/15/93     24.500      68.96
FBCV      1ST Bancorp                     Vincennes            IN   MW     SAIF      NASDAQ         04/07/87     25.125      27.38
FBER      1st Bergen Bancorp              Wood-Ridge           NJ   MA     SAIF      NASDAQ         04/01/96     19.750      56.57
FBHC      Fort Bend Holding Corp.         Rosenberg            TX   SW     SAIF      NASDAQ         06/30/93     20.875      34.96
FBSI      First Bancshares Inc.           Mountain Grove       MO   MW     SAIF      NASDAQ         12/22/93     17.000      37.16
FCBF      FCB Financial Corp.             Oshkosh              WI   MW     SAIF      NASDAQ         09/24/93     31.250     120.70
FCME      First Coastal Corp.             Westbrook            ME   NE     BIF       NASDAQ               NA     14.625      19.88
FDEF      First Defiance Financial        Defiance             OH   MW     SAIF      NASDAQ         10/02/95     15.250     130.05
FED       FirstFed Financial Corp.        Santa Monica         CA   WE     SAIF      NYSE           12/16/83     40.375     427.48
FESX      First Essex Bancorp Inc.        Andover              MA   NE     BIF       NASDAQ         08/04/87     23.625     178.05
FFBA      First Colorado Bancorp Inc.     Lakewood             CO   SW     SAIF      NASDAQ         01/02/96     25.250     424.41
FFBH      First Federal Bancshares of AR  Harrison             AR   SE     SAIF      NASDAQ         05/03/96     26.000     127.30
FFBI      First Financial Bancorp Inc.    Belvidere            IL   MW     SAIF      NASDAQ         10/04/93     23.250       9.65
FFBZ      First Federal Bancorp Inc.      Zanesville           OH   MW     SAIF      NASDAQ         07/13/92     23.000      36.23
FFCH      First Financial Holdings Inc.   Charleston           SC   SE     SAIF      NASDAQ         11/10/83     52.500     354.93
FFDB      FirstFed Bancorp Inc.           Bessemer             AL   SE     SAIF      NASDAQ         11/19/91     24.000      27.72
FFDF      FFD Financial Corp.             Dover                OH   MW     SAIF      NASDAQ         04/03/96     18.750      27.09
FFED      Fidelity Federal Bancorp        Evansville           IN   MW     SAIF      NASDAQ         08/31/87      9.750      30.50
FFES      First Federal of East Hartford  East Hartford        CT   NE     SAIF      NASDAQ         06/23/87     38.500     104.17
FFFD      North Central Bancshares Inc.   Fort Dodge           IA   MW     SAIF      NASDAQ         03/21/96     21.000      68.60
FFHH      FSF Financial Corp.             Hutchinson           MN   MW     SAIF      NASDAQ         10/07/94     20.125      61.29
FFHS      First Franklin Corp.            Cincinnati           OH   MW     SAIF      NASDAQ         01/26/88     27.000      32.18
FFIC      Flushing Financial Corp.        Flushing             NY   MA     BIF       NASDAQ         11/21/95     25.500     200.55
FFKY      First Federal Financial Corp.   Elizabethtown        KY   MW     SAIF      NASDAQ         07/15/87     22.000      91.16
FFLC      FFLC Bancorp Inc.               Leesburg             FL   SE     SAIF      NASDAQ         01/04/94     19.375      72.54
FFOH      Fidelity Financial of Ohio      Cincinnati           OH   MW     SAIF      NASDAQ         03/04/96     18.000     100.67
FFPB      First Palm Beach Bancorp Inc.   West Palm Beach      FL   SE     SAIF      NASDAQ         09/29/93     37.875     191.45
FFSL      First Independence Corp.        Independence         KS   MW     SAIF      NASDAQ         10/08/93     14.750      14.07
FFSX      First Fed SB of Siouxland(MHC)  Sioux City           IA   MW     SAIF      NASDAQ         07/13/92     31.125      88.22
FFWC      FFW Corp.                       Wabash               IN   MW     SAIF      NASDAQ         04/05/93     18.500      26.82
FFWD      Wood Bancorp Inc.               Bowling Green        OH   MW     SAIF      NASDAQ         08/31/93     22.000      58.32
FFYF      FFY Financial Corp.             Youngstown           OH   MW     SAIF      NASDAQ         06/28/93     34.250     139.40
FGHC      First Georgia Holding Inc.      Brunswick            GA   SE     SAIF      NASDAQ         02/11/87     10.000      30.52
FIBC      Financial Bancorp Inc.          Long Island City     NY   MA     SAIF      NASDAQ         08/17/94     26.000      44.45
FISB      First Indiana Corp.             Indianapolis         IN   MW     SAIF      NASDAQ         08/02/83     29.250     370.54
FKFS      First Keystone Financial        Media                PA   MA     SAIF      NASDAQ         01/26/95     17.500      42.22
FKKY      Frankfort First Bancorp Inc.    Frankfort            KY   MW     SAIF      NASDAQ         07/10/95     16.250      26.31
FLAG      FLAG Financial Corp.            LaGrange             GA   SE     SAIF      NASDAQ         12/11/86     20.625      42.01
FLFC      First Liberty Financial Corp.   Macon                GA   SE     SAIF      NASDAQ         12/06/83     30.125     233.42
FLGS      Flagstar Bancorp Inc.           Bloomfield Hills     MI   MW     SAIF      NASDAQ               NA     22.625     309.28
FLKY      First Lancaster Bancshares      Lancaster            KY   MW     SAIF      NASDAQ         07/01/96     15.125      14.39
FMCO      FMS Financial Corp.             Burlington           NJ   MA     SAIF      NASDAQ         12/14/88     35.000      83.57
FMSB      First Mutual Savings Bank       Bellevue             WA   WE     BIF       NASDAQ         12/17/85     18.375      75.80
FNGB      First Northern Capital Corp.    Green Bay            WI   MW     SAIF      NASDAQ         12/29/83     13.000     114.99
FSBI      Fidelity Bancorp Inc.           Pittsburgh           PA   MA     SAIF      NASDAQ         06/24/88     28.875      45.09
FSTC      First Citizens Corp.            Newnan               GA   SE     SAIF      NASDAQ         03/01/86     32.000      88.72
FTF       Texarkana First Financial Corp  Texarkana            AR   SE     SAIF      AMSE           07/07/95     28.250      49.71
FTFC      First Federal Capital Corp.     La Crosse            WI   MW     SAIF      NASDAQ         11/02/89     31.875     292.95
FTSB      Fort Thomas Financial Corp.     Fort Thomas          KY   MW     SAIF      NASDAQ         06/28/95     15.500      22.85
FWWB      First SB of Washington Bancorp  Walla Walla          WA   WE     SAIF      NASDAQ         11/01/95     25.500     255.28
</TABLE>

Source: SNL & F&C calculations          2
<PAGE>
 
FERGUSON & COMPANY       Exhibit V - Selected Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                          Deposit                               Current    Current
                                                                          Insurance                               Stock     Market
                                                                          Agency                                  Price      Value
Ticker    Short Name                      City               State Region (BIF/SAIF) Exchange       IPO Date        ($)       ($M)
<S>       <C>                             <C>                  <C>  <C>    <C>       <C>            <C>          <C>      <C>
GAF       GA Financial Inc.               Pittsburgh           PA   MA     SAIF      AMSE           03/26/96     19.625     151.46
GDW       Golden West Financial           Oakland              CA   WE     SAIF      NYSE           05/29/59     89.250   5,093.36
GFCO      Glenway Financial Corp.         Cincinnati           OH   MW     SAIF      NASDAQ         11/30/90     20.500      46.79
GPT       GreenPoint Financial Corp.      New York             NY   MA     BIF       NYSE           01/28/94     74.250   3,142.26
GSBC      Great Southern Bancorp Inc.     Springfield          MO   MW     SAIF      NASDAQ         12/14/89     25.500     205.22
GSFC      Green Street Financial Corp.    Fayetteville         NC   SE     SAIF      NASDAQ         04/04/96     18.375      78.98
GUPB      GFSB Bancorp Inc.               Gallup               NM   SW     SAIF      NASDAQ         06/30/95     20.375      16.31
HALL      Hallmark Capital Corp.          West Allis           WI   MW     SAIF      NASDAQ         01/03/94     16.000      46.94
HARB      Harbor Florida Bancorp (MHC)    Fort Pierce          FL   SE     SAIF      NASDAQ         01/06/94     70.500     352.12
HARL      Harleysville Savings Bank       Harleysville         PA   MA     SAIF      NASDAQ         08/04/87     30.000      50.01
HAVN      Haven Bancorp Inc.              Woodhaven            NY   MA     SAIF      NASDAQ         09/23/93     24.500     215.23
HBBI      Home Building Bancorp           Washington           IN   MW     SAIF      NASDAQ         02/08/95     22.625       7.05
HBFW      Home Bancorp                    Fort Wayne           IN   MW     SAIF      NASDAQ         03/30/95     32.750      78.12
HBNK      Highland Bancorp Inc.           Burbank              CA   WE     SAIF      NASDAQ               NA     35.750      82.88
HBS       Haywood Bancshares Inc.         Waynesville          NC   SE     BIF       AMSE           12/18/87     21.875      27.35
HFFB      Harrodsburg First Fin Bancorp   Harrodsburg          KY   MW     SAIF      NASDAQ         10/04/95     16.688      31.12
HFFC      HF Financial Corp.              Sioux Falls          SD   MW     SAIF      NASDAQ         04/08/92     29.000      86.34
HFNC      HFNC Financial Corp.            Charlotte            NC   SE     SAIF      NASDAQ         12/29/95     13.625     234.25
HFSA      Hardin Bancorp Inc.             Hardin               MO   MW     SAIF      NASDAQ         09/29/95     18.750      15.44
HHFC      Harvest Home Financial Corp.    Cheviot              OH   MW     SAIF      NASDAQ         10/10/94     15.000      13.37
HIFS      Hingham Instit. for Savings     Hingham              MA   NE     BIF       NASDAQ         12/20/88     33.000      43.02
HMNF      HMN Financial Inc.              Spring Valley        MN   MW     SAIF      NASDAQ         06/30/94     29.000     120.19
HOMF      Home Federal Bancorp            Seymour              IN   MW     SAIF      NASDAQ         01/23/88     31.500     161.28
HPBC      Home Port Bancorp Inc.          Nantucket            MA   NE     BIF       NASDAQ         08/25/88     26.500      48.81
HRBF      Harbor Federal Bancorp Inc.     Baltimore            MD   MA     SAIF      NASDAQ         08/12/94     24.000      40.64
HRZB      Horizon Financial Corp.         Bellingham           WA   WE     BIF       NASDAQ         08/01/86     17.875     133.24
HTHR      Hawthorne Financial Corp.       El Segundo           CA   WE     SAIF      NASDAQ               NA     19.750      60.99
HWEN      Home Financial Bancorp          Spencer              IN   MW     SAIF      NASDAQ         07/02/96      9.000       8.36
HZFS      Horizon Financial Svcs Corp.    Oskaloosa            IA   MW     SAIF      NASDAQ         06/30/94     14.500      12.37
IBSF      IBS Financial Corp.             Cherry Hill          NJ   MA     SAIF      NASDAQ         10/13/94     17.750     194.26
INBI      Industrial Bancorp Inc.         Bellevue             OH   MW     SAIF      NASDAQ         08/01/95     18.500      94.40
IPSW      Ipswich Savings Bank            Ipswich              MA   NE     BIF       NASDAQ         05/26/93     14.250      33.99
ITLA      ITLA Capital Corp.              La Jolla             CA   WE     BIF       NASDAQ         10/24/95     20.188     158.91
IWBK      InterWest Bancorp Inc.          Oak Harbor           WA   WE     SAIF      NASDAQ               NA     41.500     333.54
JSB       JSB Financial Inc.              Lynbrook             NY   MA     BIF       NYSE           06/27/90     53.813     533.82
JSBA      Jefferson Savings Bancorp       Ballwin              MO   MW     SAIF      NASDAQ         04/08/93     27.000     270.40
JXVL      Jacksonville Bancorp Inc.       Jacksonville         TX   SW     SAIF      NASDAQ         04/01/96     20.500      50.09
KFBI      Klamath First Bancorp           Klamath Falls        OR   WE     SAIF      NASDAQ         10/05/95     22.500     224.87
KNK       Kankakee Bancorp Inc.           Kankakee             IL   MW     SAIF      AMSE           01/06/93     33.875      46.46
KSBK      KSB Bancorp Inc.                Kingfield            ME   NE     BIF       NASDAQ         06/24/93     19.250      23.85
KYF       Kentucky First Bancorp Inc.     Cynthiana            KY   MW     SAIF      AMSE           08/29/95     13.875      17.39
LARK      Landmark Bancshares Inc.        Dodge City           KS   MW     SAIF      NASDAQ         03/28/94     22.000      37.15
LARL      Laurel Capital Group Inc.       Allison Park         PA   MA     SAIF      NASDAQ         02/20/87     22.000      47.85
LFBI      Little Falls Bancorp Inc.       Little Falls         NJ   MA     SAIF      NASDAQ         01/05/96     20.000      52.16
LFCO      Life Financial Corp.            Riverside            CA   WE     SAIF      NASDAQ               NA     16.000     104.73
LFED      Leeds Federal Bankshares (MHC)  Baltimore            MD   MA     SAIF      NASDAQ         05/02/94     21.625     112.06
LISB      Long Island Bancorp Inc.        Melville             NY   MA     SAIF      NASDAQ         04/18/94     60.188   1,446.23
LOGN      Logansport Financial Corp.      Logansport           IN   MW     SAIF      NASDAQ         06/14/95     16.250      20.49
LONF      London Financial Corp.          London               OH   MW     SAIF      NASDAQ         04/01/96     14.875       7.59
LSBI      LSB Financial Corp.             Lafayette            IN   MW     BIF       NASDAQ         02/03/95     28.250      25.89
LSBX      Lawrence Savings Bank           North Andover        MA   NE     BIF       NASDAQ         05/02/86     16.875      72.36
LVSB      Lakeview Financial              Paterson             NJ   MA     SAIF      NASDAQ         12/22/93     25.875     107.75
LXMO      Lexington B&L Financial Corp.   Lexington            MO   MW     SAIF      NASDAQ         06/06/96     16.500      18.49
MAFB      MAF Bancorp Inc.                Clarendon Hills      IL   MW     SAIF      NASDAQ         01/12/90     37.250     559.23
MARN      Marion Capital Holdings         Marion               IN   MW     SAIF      NASDAQ         03/18/93     27.000      48.10
MASB      MASSBANK Corp.                  Reading              MA   NE     BIF       NASDAQ         05/28/86     49.375     176.31
MBB       MSB Bancorp, Inc.               Goshen               NY   MA     BIF       AMSE                 NA     34.875      99.19
</TABLE>

Source: SNL & F&C calculations          3
<PAGE>
 
FERGUSON & COMPANY        Exhibit V - Selected Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                          Deposit                               Current    Current
                                                                          Insurance                               Stock     Market
                                                                          Agency                                  Price      Value
Ticker    Short Name                      City               State Region (BIF/SAIF) Exchange       IPO Date        ($)       ($M)
<S>       <C>                             <C>                  <C>  <C>    <C>       <C>            <C>          <C>      <C>
MBLF      MBLA Financial Corp.            Macon                MO   MW     SAIF      NASDAQ         06/24/93     28.125      35.27
MBSP      Mitchell Bancorp Inc.           Spruce Pine          NC   SE     SAIF      NASDAQ         07/12/96     17.000      15.83
MCBN      Mid-Coast Bancorp Inc.          Waldoboro            ME   NE     SAIF      NASDAQ         11/02/89     38.250       9.06
MDBK      Medford Bancorp Inc.            Medford              MA   NE     BIF       NASDAQ         03/18/86     43.875     199.24
MECH      MECH Financial Inc.             Hartford             CT   NE     BIF       NASDAQ         06/26/96     26.625     140.93
METF      Metropolitan Financial Corp.    Mayfield Heights     OH   MW     SAIF      NASDAQ               NA     16.813     118.55
MFBC      MFB Corp.                       Mishawaka            IN   MW     SAIF      NASDAQ         03/25/94     27.000      43.92
MFFC      Milton Federal Financial Corp.  West Milton          OH   MW     SAIF      NASDAQ         10/07/94     15.875      35.99
MFLR      Mayflower Co-operative Bank     Middleboro           MA   NE     BIF       NASDAQ         12/23/87     26.875      24.17
MIFC      Mid-Iowa Financial Corp.        Newton               IA   MW     SAIF      NASDAQ         10/14/92     12.625      21.59
MIVI      Mississippi View Holding Co.    Little Falls         MN   MW     SAIF      NASDAQ         03/24/95     18.375      13.60
MSBF      MSB Financial Inc.              Marshall             MI   MW     SAIF      NASDAQ         02/06/95     17.250      21.25
MWBI      Midwest Bancshares Inc.         Burlington           IA   MW     SAIF      NASDAQ         11/12/92     17.000      17.35
MWBX      MetroWest Bank                  Framingham           MA   NE     BIF       NASDAQ         10/10/86      7.906     111.54
NASB      North American Savings Bank     Grandview            MO   MW     SAIF      NASDAQ         09/27/85     66.500     148.94
NBN       Northeast Bancorp               Auburn               ME   NE     BIF       AMSE           08/19/87     18.063      40.15
NEIB      Northeast Indiana Bancorp       Huntington           IN   MW     SAIF      NASDAQ         06/28/95     22.250      38.19
NHTB      New Hampshire Thrift Bncshrs    Newport              NH   NE     SAIF      NASDAQ         05/22/86     19.750      41.24
NMSB      NewMil Bancorp Inc.             New Milford          CT   NE     BIF       NASDAQ         02/01/86     13.375      51.88
NSLB      NS&L Bancorp Inc.               Neosho               MO   MW     SAIF      NASDAQ         06/08/95     17.375      12.26
NWEQ      Northwest Equity Corp.          Amery                WI   MW     SAIF      NASDAQ         10/11/94     22.250      18.66
OCFC      Ocean Financial Corp.           Toms River           NJ   MA     SAIF      NASDAQ         07/03/96     35.250     282.52
OFCP      Ottawa Financial Corp.          Holland              MI   MW     SAIF      NASDAQ         08/19/94     29.500     156.74
OHSL      OHSL Financial Corp.            Cincinnati           OH   MW     SAIF      NASDAQ         02/10/93     36.750      45.61
PBCI      Pamrapo Bancorp Inc.            Bayonne              NJ   MA     SAIF      NASDAQ         11/14/89     26.750      76.05
PBKB      People's Bancshares Inc.        New Bedford          MA   NE     BIF       NASDAQ         10/30/86     22.375      73.58
PCBC      Perry County Financial Corp.    Perryville           MO   MW     SAIF      NASDAQ         02/13/95     23.875      19.77
PDB       Piedmont Bancorp Inc.           Hillsborough         NC   SE     SAIF      AMSE           12/08/95     10.625      29.23
PEEK      Peekskill Financial Corp.       Peekskill            NY   MA     SAIF      NASDAQ         12/29/95     17.000      53.16
PERM      Permanent Bancorp Inc.          Evansville           IN   MW     SAIF      NASDAQ         04/04/94     29.500      62.17
PFDC      Peoples Bancorp                 Auburn               IN   MW     SAIF      NASDAQ         07/07/87     22.250      75.24
PFED      Park Bancorp Inc.               Chicago              IL   MW     SAIF      NASDAQ         08/12/96     18.750      43.74
PFFB      PFF Bancorp Inc.                Pomona               CA   WE     SAIF      NASDAQ         03/29/96     19.375     347.89
PFFC      Peoples Financial Corp.         Massillon            OH   MW     SAIF      NASDAQ         09/13/96     16.500      23.37
PFNC      Progress Financial Corp.        Blue Bell            PA   MA     SAIF      NASDAQ         07/18/83     16.875      68.58
PFSB      PennFed Financial Services Inc  West Orange          NJ   MA     SAIF      NASDAQ         07/15/94     18.625     179.66
PFSL      Pocahontas FS&LA (MHC)          Pocahontas           AR   SE     SAIF      NASDAQ         04/05/94     44.188      72.13
PHBK      Peoples Heritage Finl Group     Portland             ME   NE     BIF       NASDAQ         12/04/86     46.563   1,291.53
PHFC      Pittsburgh Home Financial Corp  Pittsburgh           PA   MA     SAIF      NASDAQ         04/01/96     17.750      34.96
PRBC      Prestige Bancorp Inc.           Pleasant Hills       PA   MA     SAIF      NASDAQ         06/27/96     19.125      17.50
PTRS      Potters Financial Corp.         East Liverpool       OH   MW     SAIF      NASDAQ         12/31/93     19.000      18.33
PULS      Pulse Bancorp                   South River          NJ   MA     SAIF      NASDAQ         09/18/86     26.250      81.17
PVFC      PVF Capital Corp.               Bedford Heights      OH   MW     SAIF      NASDAQ         12/30/92     23.000      61.16
PVSA      Parkvale Financial Corp.        Monroeville          PA   MA     SAIF      NASDAQ         07/16/87     31.750     162.83
PWBC      PennFirst Bancorp Inc.          Ellwood City         PA   MA     SAIF      NASDAQ         06/13/90     19.125     101.57
PWBK      Pennwood Bancorp Inc.           Pittsburgh           PA   MA     SAIF      NASDAQ         07/15/96     22.000      12.11
QCBC      Quaker City Bancorp Inc.        Whittier             CA   WE     SAIF      NASDAQ         12/30/93     20.000      93.16
QCFB      QCF Bancorp Inc.                Virginia             MN   MW     SAIF      NASDAQ         04/03/95     27.250      37.65
QCSB      Queens County Bancorp Inc.      Flushing             NY   MA     BIF       NASDAQ         11/23/93     39.750     592.78
RARB      Raritan Bancorp Inc.            Bridgewater          NJ   MA     BIF       NASDAQ         03/01/87     26.500      62.86
RELY      Reliance Bancorp Inc.           Garden City          NY   MA     SAIF      NASDAQ         03/31/94     35.500     342.01
ROSE      TR Financial Corp.              Garden City          NY   MA     BIF       NASDAQ         06/29/93     32.969     580.19
SCBS      Southern Community Bancshares   Cullman              AL   SE     SAIF      NASDAQ         12/23/96     18.000      20.47
SCCB      S. Carolina Community Bancshrs  Winnsboro            SC   SE     SAIF      NASDAQ         07/07/94     21.500      12.54
SFED      SFS Bancorp Inc.                Schenectady          NY   MA     SAIF      NASDAQ         06/30/95     21.500      25.98
SFFC      StateFed Financial Corp.        Des Moines           IA   MW     SAIF      NASDAQ         01/05/94     14.250      22.22
SFIN      Statewide Financial Corp.       Jersey City          NJ   MA     SAIF      NASDAQ         10/02/95     22.750     102.58
</TABLE>

Source: SNL & F&C calculations          4
<PAGE>
 
FERGUSON & COMPANY         Exhibit V - Selected Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                          Deposit                               Current    Current
                                                                          Insurance                               Stock     Market
                                                                          Agency                                  Price      Value
Ticker    Short Name                      City               State Region (BIF/SAIF) Exchange       IPO Date        ($)       ($M)
<S>       <C>                             <C>                  <C>  <C>    <C>       <C>            <C>          <C>      <C>
SFSL      Security First Corp.            Mayfield Heights     OH   MW     SAIF      NASDAQ         01/22/88     22.000     165.62
SISB      SIS Bancorp Inc.                Springfield          MA   NE     BIF       NASDAQ         02/08/95     37.625     261.41
SKAN      Skaneateles Bancorp Inc.        Skaneateles          NY   MA     BIF       NASDAQ         06/02/86     19.125      27.48
SMBC      Southern Missouri Bancorp Inc.  Poplar Bluff         MO   MW     SAIF      NASDAQ         04/13/94     22.250      35.52
SOBI      Sobieski Bancorp Inc.           South Bend           IN   MW     SAIF      NASDAQ         03/31/95     20.500      16.07
SOPN      First Savings Bancorp Inc.      Southern Pines       NC   SE     SAIF      NASDAQ         01/06/94     23.625      87.53
SPBC      St. Paul Bancorp Inc.           Chicago              IL   MW     SAIF      NASDAQ         05/18/87     26.500     906.42
SSB       Scotland Bancorp Inc.           Laurinburg           NC   SE     SAIF      AMSE           04/01/96     10.125      19.38
SSFC      South Street Financial Corp.    Albemarle            NC   SE     SAIF      NASDAQ         10/03/96     13.000      60.79
SSM       Stone Street Bancorp Inc.       Mocksville           NC   SE     SAIF      AMSE           04/01/96     20.438      38.79
STFR      St. Francis Capital Corp.       Brookfield           WI   MW     SAIF      NASDAQ         06/21/93     43.500     228.43
STSA      Sterling Financial Corp.        Spokane              WA   WE     SAIF      NASDAQ               NA     24.125     182.62
SVRN      Sovereign Bancorp Inc.          Wyomissing           PA   MA     SAIF      NASDAQ         08/12/86     19.375   1,810.48
SZB       SouthFirst Bancshares Inc.      Sylacauga            AL   SE     SAIF      AMSE           02/14/95     22.250      21.71
THR       Three Rivers Financial Corp.    Three Rivers         MI   MW     SAIF      AMSE           08/24/95     23.500      19.38
THRD      TF Financial Corp.              Newtown              PA   MA     SAIF      NASDAQ         07/13/94     26.000      82.87
TPNZ      Tappan Zee Financial Inc.       Tarrytown            NY   MA     SAIF      NASDAQ         10/05/95     18.750      27.71
TRIC      Tri-County Bancorp Inc.         Torrington           WY   WE     SAIF      NASDAQ         09/30/93     14.000      16.34
TSH       Teche Holding Co.               Franklin             LA   SW     SAIF      AMSE           04/19/95     21.125      72.62
TWIN      Twin City Bancorp               Bristol              TN   SE     SAIF      NASDAQ         01/04/95     14.500      18.45
UBMT      United Financial Corp.          Great Falls          MT   WE     SAIF      NASDAQ         09/23/86     27.000      33.03
VABF      Virginia Beach Fed. Financial   Virginia Beach       VA   SE     SAIF      NASDAQ         11/01/80     18.000      89.65
WAMU      Washington Mutual Inc.          Seattle              WA   WE     BIF       NASDAQ         03/11/83     67.125  17,288.72
WBST      Webster Financial Corp.         Waterbury            CT   NE     SAIF      NASDAQ         12/12/86     64.250     877.22
WCBI      Westco Bancorp                  Westchester          IL   MW     SAIF      NASDAQ         06/26/92     29.000      71.47
WCFB      Webster City Federal SB (MHC)   Webster City         IA   MW     SAIF      NASDAQ         08/15/94     20.500      43.24
WEFC      Wells Financial Corp.           Wells                MN   MW     SAIF      NASDAQ         04/11/95     18.875      36.98
WEHO      Westwood Homestead Fin. Corp.   Cincinnati           OH   MW     SAIF      NASDAQ         09/30/96     14.750      41.94
WFI       Winton Financial Corp.          Cincinnati           OH   MW     SAIF      AMSE           08/04/88     26.875      53.94
WFSL      Washington Federal Inc.         Seattle              WA   WE     SAIF      NASDAQ         11/17/82     27.625   1,444.40
WHGB      WHG Bancshares Corp.            Lutherville          MD   MA     SAIF      NASDAQ         04/01/96     18.500      25.70
WOFC      Western Ohio Financial Corp.    Springfield          OH   MW     SAIF      NASDAQ         07/29/94     26.750      64.99
WRNB      Warren Bancorp Inc.             Peabody              MA   NE     BIF       NASDAQ         07/09/86     23.000      87.54
WSB       Washington Savings Bank, FSB    Bowie                MD   MA     SAIF      AMSE                 NA      8.750      38.46
WSFS      WSFS Financial Corp.            Wilmington           DE   MA     BIF       NASDAQ         11/26/86     20.750     258.54
WSTR      WesterFed Financial Corp.       Missoula             MT   WE     SAIF      NASDAQ         01/10/94     26.000     145.13
WVFC      WVS Financial Corp.             Pittsburgh           PA   MA     SAIF      NASDAQ         11/29/93     38.000      68.71
WYNE      Wayne Bancorp Inc.              Wayne                NJ   MA     SAIF      NASDAQ         06/27/96     24.500      49.34
YFCB      Yonkers Financial Corp.         Yonkers              NY   MA     SAIF      NASDAQ         04/18/96     18.688      56.45
YFED      York Financial Corp.            York                 PA   MA     SAIF      NASDAQ         02/01/84     25.500     225.72

Maximum                                                                                                          93.750  17,288.72
Minimum                                                                                                           7.906       7.05
Average                                                                                                          25.861     293.65
Median                                                                                                           22.250      65.62
</TABLE>

Source: SNL & F&C calculations          5
<PAGE>
 
FERGUSON & COMPANY            Exhibit V - Selected Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                               Tangible
          Price/   Current   Current             Current       Total  Equity/   Equity/     Core     Core     Core   
             LTM    Price/  Price/ T   Price/   Dividend      Assets   Assets  T Assets      EPS     ROAA     ROAE  Merger   Current
        Core EPS    Book V    Book V   Assets      Yield       ($000)     (%)       (%)      ($)      (%)      (%)  Target?  Pricing
Ticker       (x)       (%)       (%)      (%)        (%)         MRQ      MRQ       MRQ      LTM      LTM      LTM  (Y/N)       Date
<S>         <C>      <C>       <C>       <C>        <C>   <C>            <C>       <C>      <C>      <C>     <C>      <C>   <C>
AABC         9.7     144.8     144.8     12.5         --     105,639      8.7       8.7     1.12     1.34    20.89    N     02/27/98
ABBK        21.7     210.2     231.0     14.4       0.95     531,986      6.8       6.3     0.97     0.77    11.15    N     02/27/98
ABCL        19.8     168.5     170.5     16.2       1.60   1,363,825      9.6       9.5     1.39     0.85     9.25    N     02/27/98
ABCW        22.5     301.8     306.7     20.1       0.74   1,941,180      6.7       6.5     1.91     0.96    14.70    N     02/27/98
AFED        21.1     120.0     120.0     16.9       1.43     160,408     12.5      12.5     0.93     0.79     5.91    N     02/27/98
AHM         19.8     303.5     355.6     12.5       1.41  46,678,752      5.1       4.6     3.16     0.77    15.24    N     02/27/98
ALBC        25.0     133.0     133.0     11.4       0.99      70,810      8.6       8.6     0.43     0.49     5.46    N     02/27/98
ALBK        15.5     174.5     224.7     15.4       1.48   4,083,097      8.8       7.0     3.14     1.18    12.92    N     02/27/98
AMFC        24.1     111.7     111.7     16.5       1.64     100,003     14.8      14.8     0.71     0.71     4.39    N     02/27/98
ANA         21.3     128.6     128.6     21.8       1.99     274,018     17.0      17.0     1.04     0.95     5.44    N     02/27/98
ANDB        16.3     192.5     192.5     15.6       1.91   1,322,745      8.1       8.1     2.44     1.04    12.97    N     02/27/98
ANE         23.4     173.0     177.9     13.2       1.01     247,129      7.6       7.4     0.85     0.59     8.48    N     02/27/98
ASBI        20.1     150.4     150.5     16.9       3.12     393,028     11.2      11.2     1.02     0.83     7.60    N     02/27/98
ASBP        21.5     129.8     129.8     20.1       2.91     113,176     15.5      15.5     0.64     0.92     5.87    N     02/27/98
ASFC        19.7     172.4     247.7     13.9       1.43  10,528,393      8.5       6.2     2.83     0.77     9.55    N     02/27/98
BANC        26.5     167.9     192.3     11.4       0.98   3,064,480      6.8       6.0     0.51     0.53     9.11    N     02/27/98
BDJI        24.1     171.4     171.4     17.4         --     118,838     10.2      10.2     0.86     0.66     6.05    N     02/27/98
BFD         19.9     140.7     146.0     12.5       1.27     974,680      8.4       8.1     1.11     0.67     7.37    N     02/27/98
BFSB        20.1     155.9     155.9     23.8       1.97     136,908     14.5      14.5     1.42     1.19     8.34    N     02/27/98
BKC         17.1     202.5     209.4     18.3       3.03     639,013      9.0       8.8     2.94     1.15    13.74    N     02/27/98
BKCT        19.3     200.7     200.7     21.3       2.81     443,025     10.6      10.6     0.96     1.24    12.02    N     02/27/98
BKUNA       34.2     160.9     181.1      6.9         --   3,028,776      4.8       4.4     0.43     0.37     6.20    N     02/27/98
BNKU        21.6     243.0     249.3     11.9       1.36  12,523,459      4.9       4.8     2.18     0.61    11.99    N     02/27/98
BPLS        20.2     157.6     173.1      6.9         --   4,167,806      4.4       4.0     0.73     0.38     7.06    N     02/27/98
BVCC        24.0     241.7     291.0     12.9       1.15   3,246,476      5.4       4.5     1.45     0.61    10.00    N     02/27/98
BYFC        29.7      86.3      86.3      8.5       1.57     124,740     10.6      10.6     0.43     0.31     2.75    N     02/27/98
CAFI        18.3     166.7     179.7     15.7       2.13     520,582      9.4       8.8     1.39     0.94     9.78    N     02/27/98
CASB        21.0     179.6     179.6     12.5         --     422,530      6.9       6.9     0.74     0.64     9.80    N     02/27/98
CASH        18.8     139.6     156.5     15.1       2.10     407,592     10.8       9.8     1.22     0.90     7.97    N     02/27/98
CATB        21.6     118.7     118.7     28.9       1.74     294,656     24.3      24.3     0.85     1.34     5.19    N     02/27/98
CBCI        16.3     144.3     144.3     24.2         --     486,626     16.8      16.8     2.30     1.62    10.26    N     02/27/98
CBES        24.8     149.3     149.3     23.5       1.57     111,127     15.8      15.8     1.03     0.97     5.52    N     02/27/98
CBSA        14.0     151.5     178.2      5.4       1.53   2,911,410      3.6       3.1     2.24     0.40    11.61    N     02/27/98
CEBK        24.4     174.4     192.9     17.1       1.00     367,096      9.8       9.0     1.31     0.75     7.43    N     02/27/98
CENB        21.6     123.8     123.8     37.3       2.13     102,281     30.2      30.2     4.34     1.63     5.91    N     02/27/98
CFB         17.3     251.6     279.0     16.0       0.62   7,189,342      6.4       5.8     2.04     0.95    15.76    N     02/27/98
CFCP        20.7     301.7     301.7     18.0       1.66     563,866      6.0       6.0     1.05     1.04    16.59    N     02/27/98
CFFC        20.5     161.9     161.9     21.4       1.82     183,278     13.2      13.2     1.50     1.13     8.22    N     02/27/98
CFNC        24.3     126.2     126.2     28.7       1.35     114,660     22.7      22.7     0.73     1.17     5.06    N     02/27/98
CFSB        23.6     332.2     332.2     26.3       1.63     852,888      7.9       7.9     1.25     1.18    15.27    N     02/27/98
CFTP        29.2     126.9     126.9     37.8       1.71     228,656     26.5      26.5     0.64     1.33     4.54    N     02/27/98
CIBI        16.3     140.1     140.1     16.2       1.86      95,876     11.6      11.6     1.06     0.97     8.33    N     02/27/98
CKFB        20.1     113.8     113.8     26.9       2.56      62,865     21.9      21.9     0.97     1.37     5.84    N     02/27/98
CLAS        27.0     122.7     143.9     18.5       1.48     132,793     15.1      13.1     0.70     0.64     4.31    N     02/27/98
CMRN        20.8     113.3     113.3     24.3       1.40     211,253     21.4      21.4     0.96     1.16     5.26    N     02/27/98
CMSB        29.1     154.1     195.2     14.6       1.37   2,268,595      9.5       7.6     0.70     0.50     5.17    N     02/27/98
CNIT        22.1     229.8     250.9     16.8       1.68     701,708      7.0       6.4     3.22     0.78    10.96    N     02/27/98
COFI        19.1     281.1     300.9     19.6       1.65  19,760,265      7.0       6.5     3.18     1.10    15.66    N     02/27/98
COOP        29.4     213.6     213.6     16.4         --     369,121      7.7       7.7     0.69     0.60     7.76    N     02/27/98
CRZY        20.9     109.7     109.7     25.9       2.42      60,774     23.6      23.6     0.79     1.30     5.11    N     02/27/98
CVAL        23.4     239.8     239.8     21.1       1.39     325,643      8.8       8.8     1.36     0.95    11.04    N     02/27/98
DCBI        25.0     163.5     163.5     43.8       0.99     107,747     26.8      26.8     0.97     1.70     6.10    N     02/27/98
DIBK        10.0     203.6     209.0     16.8       1.54     958,503      8.3       8.1     3.14     1.92    24.02    N     02/27/98
DIME        28.2     167.8     194.2     21.0       1.27   1,488,074     12.5      11.0     0.89     0.86     5.86    N     02/27/98
DME         27.2     269.9     329.0     16.2       0.53  21,848,000      6.0       5.0     1.12     0.60    11.05    N     02/27/98
DNFC        19.2     243.5     245.8     13.2       0.69   1,815,315      5.4       5.4     1.37     0.79    14.13    N     02/27/98
DSL         17.9     181.9      NA       13.4       1.09   5,835,825      7.4      NA       1.63     0.76    10.64    N     02/27/98
</TABLE>

Source: SNL & F&C calculations          6
<PAGE>
 
FERGUSON & COMPANY         Exhibit V - Selected Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                               Tangible
          Price/   Current   Current             Current       Total  Equity/   Equity/     Core     Core     Core   
             LTM    Price/  Price/ T   Price/   Dividend      Assets   Assets  T Assets      EPS     ROAA     ROAE  Merger   Current
        Core EPS    Book V    Book V   Assets      Yield       ($000)     (%)       (%)      ($)      (%)      (%)  Target?  Pricing
Ticker       (x)       (%)       (%)      (%)        (%)         MRQ      MRQ       MRQ      LTM      LTM      LTM  (Y/N)       Date
<S>         <C>      <C>       <C>       <C>        <C>   <C>            <C>       <C>      <C>      <C>     <C>      <C>   <C>
EBSI        18.8     159.7     159.7     12.6       2.93     934,458      7.8       7.8     1.09     0.77     9.06    N     02/27/98
EFBI        33.4     204.6     204.8     22.0       3.00     301,261     10.8      10.8     1.00     0.75     6.28    N     02/27/98
EMLD        19.8     231.4     234.6     18.6       1.27     603,965      8.0       7.9     1.12     0.98    12.77    N     02/27/98
EQSB        17.1     221.5     221.5     11.5         --     321,687      5.2       5.2     1.78     0.74    14.65    N     02/27/98
ESBK        27.5     143.9     147.8      9.4       2.22     228,268      6.4       6.2     1.05     0.34     5.40    N     02/27/98
ETFS        31.1     106.4     106.4     18.6       0.92     120,093     17.5      17.5     0.70     0.59     3.23    N     02/27/98
FBBC        15.6     167.3     167.3     18.1       2.13     675,684     10.8      10.8     1.20     1.06    10.03    N     02/27/98
FBCI        22.7     134.5     134.7     14.1       1.63     489,673     10.5      10.5     1.08     0.61     5.92    N     02/27/98
FBCV        21.3     119.2     121.3     10.7       1.06     255,927      9.0       8.8     1.18     0.49     5.85    N     02/27/98
FBER        27.1     145.5     145.5     19.9       1.01     284,739     13.7      13.7     0.73     0.77     4.94    N     02/27/98
FBHC        30.3     170.0     181.4     11.5       1.92     302,728      6.8       6.4     0.69     0.47     7.53    N     02/27/98
FBSI        20.5     159.8     159.8     23.0       0.59     161,527     14.4      14.4     0.83     1.12     8.06    N     02/27/98
FCBF        21.9     164.7     164.7     23.2       2.56     519,911     14.1      14.1     1.43     1.15     7.69    N     02/27/98
FCME         3.4     137.2     137.2     13.4         --     148,571      9.8       9.8     4.31     3.97    44.97    N     02/27/98
FDEF        25.4     121.7     121.7     22.4       2.36     579,698     18.4      18.4     0.60     0.94     4.57    N     02/27/98
FED         19.1     191.9     193.6     10.3         --   4,160,115      5.4       5.3     2.11     0.55    11.05    N     02/27/98
FESX        21.1     195.6     222.5     14.9       2.37   1,197,459      7.6       6.8     1.12     0.73    10.03    N     02/27/98
FFBA        21.8     202.8     207.0     27.3       2.06   1,555,274     13.5      13.2     1.16     1.24     9.43    N     02/27/98
FFBH        22.6     156.3     156.3     23.3       1.08     547,119     14.9      14.9     1.15     1.01     6.51    N     02/27/98
FFBI        25.6     128.5     128.5     11.5         --      84,242      8.9       8.9     0.91     0.42     5.18    N     02/27/98
FFBZ        21.9     251.6     251.9     17.4       1.22     208,840      7.6       7.6     1.05     0.92    12.01    N     02/27/98
FFCH        24.2     307.4     307.4     19.8       1.60   1,793,325      6.4       6.4     2.17     0.86    13.90    N     02/27/98
FFDB        17.4     160.0     174.3     15.5       2.08     178,792      9.7       9.0     1.38     0.96     9.89    N     02/27/98
FFDF        33.5     121.9     121.9     29.3       1.60      92,364     24.1      24.1     0.56     0.88     3.60    N     02/27/98
FFED        16.0     194.2     194.2     14.1       4.10     215,821      7.3       7.3     0.61     0.68    11.84    N     02/27/98
FFES        17.3     155.5     155.5     10.6       1.77     982,747      6.8       6.8     2.23     0.63     9.71    N     02/27/98
FFFD        18.1     136.1     136.1     30.9       1.52     221,954     22.7      22.7     1.16     1.78     7.61    N     02/27/98
FFHH        18.3     123.2     123.2     15.1       2.48     402,850     10.9      10.9     1.10     0.82     7.15    N     02/27/98
FFHS        22.3     154.4     155.3     13.9       1.48     231,189      9.0       9.0     1.21     0.65     7.31    N     02/27/98
FFIC        22.6     147.0     153.0     18.4       1.26   1,088,476     12.5      12.1     1.13     0.88     6.08    N     02/27/98
FFKY        15.1     171.7     181.7     23.5       2.55     388,329     13.7      13.0     1.46     1.61    11.79    N     02/27/98
FFLC        21.3     141.0     141.0     18.1       1.86     400,237     12.9      12.9     0.91     0.95     6.79    N     02/27/98
FFOH        21.2     156.7     177.7     18.8       1.56     535,100     12.0      10.7     0.85     0.90     6.93    N     02/27/98
FFPB        26.7     165.0     168.8     10.5       1.85   1,821,077      6.4       6.2     1.42     0.44     6.61    N     02/27/98
FFSL        20.5     123.9     123.9     12.4       2.03     113,669     10.0      10.0     0.72     0.65     6.26    N     02/27/98
FFSX        27.1     217.1     218.7     19.2       1.54     458,940      8.9       8.8     1.15     0.71     8.40    N     02/27/98
FFWC        14.9     145.8     159.9     14.0       1.95     191,298      9.6       8.8     1.24     1.01    10.28    N     02/27/98
FFWD        29.0     273.6     273.6     35.0       1.55     166,546     12.8      12.8     0.76     1.29    10.30    N     02/27/98
FFYF        17.8     166.8     166.8     22.7       2.34     614,749     13.6      13.6     1.93     1.27     9.23    N     02/27/98
FGHC        22.2     220.8     238.1     18.4       4.00     166,386      8.3       7.8     0.45     0.94    11.32    N     02/27/98
FIBC        15.5     161.5     162.2     14.4       1.92     308,248      8.9       8.9     1.68     0.99    10.50    N     02/27/98
FISB        26.6     242.1     245.0     23.0       1.64   1,613,405      9.5       9.4     1.10     0.95     9.87    N     02/27/98
FKFS        16.5     168.6     168.6     11.2       1.14     378,527      6.6       6.6     1.06     0.73    10.47    N     02/27/98
FKKY        27.1     116.7     116.7     19.8       4.92     132,809     17.0      17.0     0.60     0.72     3.42    N     02/27/98
FLAG        25.8     193.5     193.5     17.6       1.65     238,463      9.1       9.1     0.80     0.72     7.98    N     02/27/98
FLFC        23.9     241.2     265.4     18.3       1.46   1,275,398      7.6       7.0     1.26     0.79    10.53    N     02/27/98
FLGS        12.9     254.5     264.9     15.2       1.06   2,033,260      6.0       5.8     1.75     1.43    22.94    N     02/27/98
FLKY        27.5     103.5     103.5     30.5       3.31      47,184     29.5      29.5     0.55     1.24     3.64    N     02/27/98
FMCO        15.4     221.5     224.8     14.4       0.80     581,660      6.5       6.4     2.27     1.02    15.74    N     02/27/98
FMSB        17.5     247.3     247.3     17.0       1.09     445,762      6.9       6.9     1.05     1.03    15.27    N     02/27/98
FNGB        20.6     155.7     155.7     17.2       2.77     667,696     11.1      11.1     0.63     0.90     7.98    N     02/27/98
FSBI        17.2     167.8     167.8     11.5       1.25     393,076      6.8       6.8     1.68     0.76    11.16    N     02/27/98
FSTC        17.0     248.8     311.3     25.1       1.00     352,233     10.1       8.2     1.88     1.70    17.58    N     02/27/98
FTF         16.2     182.0     182.0     27.6       1.98     180,259     15.2      15.2     1.74     1.71    10.91    N     02/27/98
FTFC        22.8     267.9     283.1     19.0       1.51   1,544,294      7.1       6.7     1.40     0.89    13.57    N     02/27/98
FTSB        18.9     144.7     144.7     22.9       1.61      99,873     15.8      15.8     0.82     1.23     7.53    N     02/27/98
FWWB        20.4     158.2     170.8     22.8       1.41   1,136,693     13.4      12.5     1.25     1.15     8.00    N     02/27/98
</TABLE>

Source: SNL & F&C calculations


                                       7
<PAGE>
 
FERGUSON & COMPANY            Exhibit V - Selected Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                               Tangible
          Price/   Current   Current             Current       Total  Equity/   Equity/     Core     Core     Core   
             LTM    Price/  Price/ T   Price/   Dividend      Assets   Assets  T Assets      EPS     ROAA     ROAE  Merger   Current
        Core EPS    Book V    Book V   Assets      Yield       ($000)     (%)       (%)      ($)      (%)      (%)  Target?  Pricing
Ticker       (x)       (%)       (%)      (%)        (%)         MRQ      MRQ       MRQ      LTM      LTM      LTM  (Y/N)       Date
<S>         <C>      <C>       <C>       <C>        <C>   <C>            <C>       <C>      <C>      <C>     <C>      <C>   <C>
GAF         18.0     130.4     131.6     19.3       2.45     783,948     14.8      14.7     1.09     1.08     6.80    N     02/27/98
GDW         14.8     188.8     188.8     12.9       0.56  39,590,271      6.8       6.8     6.04     0.90    13.93    N     02/27/98
GFCO        19.7     165.2     166.9     15.4       1.95     304,621      9.3       9.2     1.04     0.83     8.78    N     02/27/98
GPT         20.6     218.4     400.5     24.0       1.72  13,083,518      9.7       5.5     3.60     1.08    10.64    N     02/27/98
GSBC        16.9     313.7     316.4     27.4       1.73     750,458      8.7       8.7     1.51     1.75    20.23    N     02/27/98
GSFC        27.0     124.8     124.8     44.0       2.40     179,700     35.2      35.2     0.68     1.60     4.48    N     02/27/98
GUPB        18.7     113.8     113.8     14.2       1.96     114,745     12.5      12.5     1.09     0.89     6.09    N     02/27/98
HALL        17.2     148.8     148.8     11.4         --     413,511      7.6       7.6     0.93     0.65     9.09    N     02/27/98
HARB        25.6     348.3     359.0     31.1       1.99   1,128,942      8.9       8.7     2.75     1.24    14.73    N     02/27/98
HARL        14.9     210.8     210.8     14.4       1.47     347,882      6.8       6.8     2.01     1.02    15.66    N     02/27/98
HAVN        19.6     190.7     191.3     10.9       1.22   1,974,890      5.7       5.7     1.25     0.63    10.51    N     02/27/98
HBBI        20.8     109.8     109.8     16.6       1.33      42,430     14.1      14.1     1.09     0.72     5.48    N     02/27/98
HBFW        27.1     183.7     183.7     22.3       0.61     350,038     12.2      12.2     1.21     0.86     6.48    N     02/27/98
HBNK        17.9     199.7     199.7     15.1         --     549,638      7.6       7.6     2.00     0.93    12.51    N     02/27/98
HBS         14.0     126.2     130.7     17.9       2.74     152,796     14.2      13.8     1.56     1.37     9.41    N     02/27/98
HFFB        21.1     105.3     105.3     30.4       2.40     108,908     26.7      26.7     0.79     1.36     5.06    N     02/27/98
HFFC        15.8     155.1     155.1     14.9       1.45     580,668      9.6       9.6     1.84     1.00    10.68    N     02/27/98
HFNC        25.7     141.1     141.1     25.7       2.35     910,786     18.2      18.2     0.53     0.94     4.61    N     02/27/98
HFSA        20.4     118.0     118.0     13.4       2.56     115,434     11.3      11.3     0.92     0.69     5.56    N     02/27/98
HHFC        22.7     129.1     129.1     14.4       2.93      93,141     11.1      11.1     0.66     0.67     5.68    N     02/27/98
HIFS        16.5     201.2     201.2     19.3       1.46     222,584      9.6       9.6     2.00     1.26    13.00    N     02/27/98
HMNF        25.7     142.3     153.3     17.4         --     691,232     12.2      11.5     1.13     0.78     5.43    N     02/27/98
HOMF        20.2     258.0     265.4     22.7       1.27     709,412      8.8       8.6     1.56     1.22    14.31    N     02/27/98
HPBC        15.1     222.3     222.3     23.4       3.02     208,815     10.5      10.5     1.75     1.64    15.43    N     02/27/98
HRBF        25.3     139.4     139.4     17.4       2.00     233,572     12.5      12.5     0.95     0.72     5.55    N     02/27/98
HRZB        16.3     157.1     157.1     25.0       2.46     532,767     15.9      15.9     1.10     1.55     9.90    N     02/27/98
HTHR        15.8     141.0     141.0      6.8         --     891,163      6.2       6.2     1.25     1.04    18.87    N     02/27/98
HWEN        31.0     113.2     113.2     19.2       1.11      43,504     17.0      17.0     0.29     0.60     3.36    N     02/27/98
HZFS        21.6     137.1     137.1     13.9       1.24      88,769     10.2      10.2     0.67     0.68     6.70    N     02/27/98
IBSF        32.9     150.4     150.4     26.7       2.25     728,181     17.7      17.7     0.54     0.79     4.36    N     02/27/98
INBI        18.0     155.1     155.1     25.9       3.03     364,023     16.7      16.7     1.03     1.48     8.38    N     02/27/98
IPSW        19.8     287.3     287.3     15.0       1.12     227,244      5.2       5.2     0.72     0.97    16.95    N     02/27/98
ITLA        12.9     160.0      NA       15.6         --   1,015,909      9.8      NA       1.57     1.37    13.26    N     02/27/98
IWBK        19.0     250.0     254.3     16.8       1.74   1,982,317      6.7       6.6     2.18     0.95    14.38    N     02/27/98
JSB         21.1     149.9     149.9     34.8       2.97   1,531,068     23.2      23.2     2.55     1.72     7.67    N     02/27/98
JSBA        25.7     219.7     280.1     21.5       1.04   1,257,753      9.0       7.2     1.05     0.76     9.32    N     02/27/98
JXVL        15.1     145.5     145.5     21.3       2.44     235,405     14.6      14.6     1.36     1.49     9.90    N     02/27/98
KFBI        24.2     141.3     154.6     23.1       1.42     975,207     15.1      14.0     0.93     1.07     6.11    N     02/27/98
KNK         17.3     122.9     130.3     13.5       1.42     343,409     11.0      10.5     1.96     0.86     7.88    N     02/27/98
KSBK        15.3     206.3     216.1     15.6       0.52     152,752      7.6       7.3     1.26     1.05    14.06    N     02/27/98
KYF         18.0     122.6     122.6     20.9       3.60      86,307     17.0      17.0     0.77     1.11     6.70    N     02/27/98
LARK        17.5     112.9     112.9     15.9       1.82     233,640     14.1      14.1     1.26     0.98     6.94    N     02/27/98
LARL        17.3     212.2     212.2     22.4       1.58     213,379     10.6      10.6     1.27     1.40    13.48    N     02/27/98
LFBI        33.3     137.7     149.3     16.1       1.00     324,425     11.7      10.9     0.60     0.51     3.93    N     02/27/98
LFCO         6.2     191.2     191.2     25.6         --     409,357     13.4      13.4     2.60     3.77    32.59    N     02/27/98
LFED        32.8     231.3     231.3     38.5       2.59     291,408     16.6      16.6     0.66     1.21     7.36    N     02/27/98
LISB        33.6     259.5     261.9     23.8       1.00   6,072,524      9.2       9.1     1.79     0.71     7.82    N     02/27/98
LOGN        16.4     123.9     123.9     23.8       2.46      86,115     19.2      19.2     0.99     1.53     7.81    N     02/27/98
LONF        18.6     145.4     145.4     20.0       1.61      37,916     13.8      13.8     0.80     1.00     5.21    N     02/27/98
LSBI        17.8     136.9     136.9     12.5       1.42     206,584      8.6       8.6     1.59     0.72     8.16    N     02/27/98
LSBX         9.4     192.4     192.4     20.1         --     359,855     10.5      10.5     1.80     2.29    25.38    N     02/27/98
LVSB        29.4     194.7     230.2     20.8       0.48     517,974     10.7       9.2     0.88     0.89     8.44    N     02/27/98
LXMO        23.6     111.6     111.6     29.7       1.82      58,783     26.6      26.6     0.70     1.23     4.21    N     02/27/98
MAFB        15.9     212.3     240.9     16.2       0.75   3,457,664      7.6       6.8     2.35     1.13    14.48    N     02/27/98
MARN        17.8     120.6     123.3     25.1       3.26     191,854     20.8      20.4     1.52     1.58     7.09    N     02/27/98
MASB        19.3     169.9     172.4     19.1       2.03     925,403     11.2      11.1     2.56     1.03     9.73    N     02/27/98
MBB         31.1     155.7     292.1     12.8       1.72     773,991      9.8       6.2     1.12     0.54     6.17    N     02/27/98
</TABLE>

Source: SNL & F&C calculations


                                       8
<PAGE>
 
FERGUSON & COMPANY            Exhibit V - Selected Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                               Tangible
          Price/   Current   Current             Current       Total  Equity/   Equity/     Core     Core     Core   
             LTM    Price/  Price/ T   Price/   Dividend      Assets   Assets  T Assets      EPS     ROAA     ROAE  Merger   Current
        Core EPS    Book V    Book V   Assets      Yield       ($000)     (%)       (%)      ($)      (%)      (%)  Target?  Pricing
Ticker       (x)       (%)       (%)      (%)        (%)         MRQ      MRQ       MRQ      LTM      LTM      LTM  (Y/N)       Date
<S>         <C>      <C>       <C>       <C>        <C>   <C>            <C>       <C>      <C>      <C>     <C>      <C>   <C>
MBLF        20.8     126.0     126.0     16.0       1.42     223,558     12.7      12.7     1.35     0.82     6.41    N     02/27/98
MBSP        28.3     109.3     109.3     43.8       2.35      36,103     40.1      40.1     0.60     1.51     3.62    N     02/27/98
MCBN        20.8     173.6     173.6     14.5       1.36      62,632      8.3       8.3     1.84     0.71     8.34    N     02/27/98
MDBK        19.1     196.3     208.6     17.6       1.82   1,135,572      8.9       8.5     2.30     1.01    11.38    N     02/27/98
MECH        10.8     159.2     159.2     15.8         --     892,371      9.9       9.9     2.46     1.57    15.80    N     02/27/98
METF        21.8     323.3     351.7     12.8         --     924,985      4.0       3.7     0.77     0.65    16.43    N     02/27/98
MFBC        22.9     131.0     131.0     16.6       1.26     264,097     12.7      12.7     1.18     0.82     5.99    N     02/27/98
MFFC        28.4     130.0     130.0     16.5       3.78     218,826     11.8      11.8     0.56     0.62     4.67    N     02/27/98
MFLR        19.1     187.8     190.7     18.3       2.98     131,908      9.8       9.6     1.41     1.00    10.40    N     02/27/98
MIFC        15.8     170.4     170.6     16.0       0.63     135,345      9.4       9.4     0.80     1.10    11.83    N     02/27/98
MIVI        19.6     109.1     109.1     19.8       1.74      68,619     18.2      18.2     0.94     1.06     6.27    N     02/27/98
MSBF        20.5     163.4     163.4     27.5       1.74      77,444     16.9      16.9     0.84     1.40     8.16    N     02/27/98
MWBI        16.8     162.5     162.5     11.8       1.41     147,724      7.2       7.2     1.01     0.77    11.14    N     02/27/98
MWBX        14.9     249.4     249.4     18.3       1.52     608,941      7.4       7.4     0.53     1.32    17.83    N     02/27/98
NASB        15.2     239.0     246.1     20.3       1.50     734,091      8.5       8.3     4.39     1.36    17.29    N     02/27/98
NBN         28.7     189.9     215.0     13.2       1.17     265,442      7.7       7.0     0.63     0.61     7.89    N     02/27/98
NEIB        18.4     143.5     143.5     20.6       1.53     190,319     14.4      14.4     1.21     1.20     7.78    N     02/27/98
NHTB        25.3     164.0     191.0     12.8       3.04     319,338      7.8       6.8     0.78     0.59     7.89    N     02/27/98
NMSB        20.3     156.6     156.6     14.6       2.39     355,526      9.3       9.3     0.66     0.87     8.55    N     02/27/98
NSLB        27.2     104.6     105.4     20.7       2.88      59,817     19.8      19.7     0.64     0.74     3.63    N     02/27/98
NWEQ        17.1     150.1     150.1     18.7       2.70      99,558     11.6      11.6     1.30     1.02     8.78    N     02/27/98
OCFC        21.5     127.6     127.6     19.4       2.27   1,489,220     15.2      15.2     1.64     1.00     5.71    N     02/27/98
OFCP        23.2     205.3     252.4     17.7       1.36     885,817      8.6       7.1     1.27     0.83     9.47    N     02/27/98
OHSL        23.6     170.1     170.1     19.1       2.40     238,905     10.9      10.9     1.56     0.84     7.55    N     02/27/98
PBCI        16.1     156.7     157.7     20.2       4.19     376,714     12.9      12.8     1.66     1.31     9.87    N     02/27/98
PBKB        32.0     244.3     254.0      9.7       2.15     762,910      4.0       3.8     0.70     0.40     7.94    N     02/27/98
PCBC        20.6     120.8     120.8     23.3       1.68      85,030     19.2      19.2     1.16     1.08     5.72    N     02/27/98
PDB         19.0     138.7     138.7     22.5       3.77     130,167     16.2      16.2     0.56     1.22     7.26    N     02/27/98
PEEK        25.4     114.3     114.3     28.9       2.12     184,215     25.2      25.2     0.67     1.09     4.23    N     02/27/98
PERM        24.6     142.7     144.4     14.8       1.49     419,819     10.0       9.9     1.20     0.61     6.49    N     02/27/98
PFDC        17.8     167.9     167.9     25.6       1.98     294,291     15.3      15.3     1.25     1.49     9.78    N     02/27/98
PFED        28.9     113.3     113.3     24.7         --     176,957     21.8      21.8     0.65     0.85     3.75    N     02/27/98
PFFB        25.2     129.6     130.9     12.6         --   2,765,855      9.7       9.6     0.77     0.52     5.02    N     02/27/98
PFFC        33.7     150.3     150.3     28.4       3.03      82,464     18.9      18.9     0.49     0.78     3.22    N     02/27/98
PFNC        24.5     273.1     325.1     13.9       0.71     493,406      5.1       4.3     0.69     0.70    13.37    N     02/27/98
PFSB        16.6     161.7     188.7     12.2       0.75   1,475,509      7.0       6.0     1.12     0.81    10.98    N     02/27/98
PFSL        31.1     291.5     291.5     18.5       2.04     389,405      6.4       6.4     1.42     0.62     9.72    N     02/27/98
PHBK        18.3     271.8     361.8     19.0       1.89   6,795,337      7.0       5.4     2.54     1.25    16.13    N     02/27/98
PHFC        17.9     141.8     143.5     11.7       1.35     299,669      8.2       8.1     0.99     0.71     6.51    N     02/27/98
PRBC        21.3     112.0     112.0     12.2       1.05     143,263     10.9      10.9     0.90     0.57     5.03    N     02/27/98
PTRS        16.5     169.5     169.5     14.9       1.05     122,716      8.8       8.8     1.15     0.96    10.72    N     02/27/98
PULS        14.8     183.4     183.4     15.0       3.05     539,322      8.2       8.2     1.77     1.08    13.56    N     02/27/98
PVFC        13.3     212.0     212.0     15.4         --     396,214      7.3       7.3     1.73     1.29    18.16    N     02/27/98
PVSA        15.7     201.1     202.2     15.9       1.64   1,019,143      7.9       7.9     2.02     1.07    14.71    N     02/27/98
PWBC        18.4     147.6     166.0     12.4       1.88     822,350      8.4       7.5     1.04     0.66     8.61    N     02/27/98
PWBK        25.6     131.3     131.3     25.7       1.64      47,211     18.0      18.0     0.86     0.98     5.28    N     02/27/98
QCBC        16.1     127.2     127.2     11.0         --     852,154      8.6       8.6     1.24     0.70     8.08    N     02/27/98
QCFB        13.4     140.4     140.4     24.7         --     152,668     17.6      17.6     2.04     1.62     9.27    N     02/27/98
QCSB        28.2     299.8     299.8     39.0       2.01   1,541,049     11.2      11.2     1.41     1.55    11.55    N     02/27/98
RARB        17.4     203.7     206.6     15.4       2.26     408,308      7.6       7.5     1.52     1.01    12.93    N     02/27/98
RELY        19.1     178.2     261.6     15.3       1.80   2,243,100      8.6       6.0     1.86     0.85    10.31    N     02/27/98
ROSE        18.8     226.8     226.8     15.1       2.06   3,843,056      6.3       6.3     1.75     0.87    14.16    N     02/27/98
SCBS        20.7     145.2     145.2     28.9       1.67      70,893     19.9      19.9     0.87     1.20     5.66    N     02/27/98
SCCB        30.7     134.5     134.5     27.8       2.98      45,092     20.7      20.7     0.70     1.00     3.95    N     02/27/98
SFED        23.9     121.3     121.3     14.9       1.49     174,428     12.3      12.3     0.90     0.61     4.87    N     02/27/98
SFFC        19.8     141.9     141.9     25.1       1.40      88,608     17.7      17.7     0.72     1.27     7.21    N     02/27/98
SFIN        17.9     158.7     158.9     14.9       1.93     703,112      9.4       9.4     1.27     0.81     8.46    N     02/27/98
</TABLE>

Source: SNL & F&C calculations          9
<PAGE>
 
FERGUSON & COMPANY         Exhibit V - Selected Publicly Held Thrifts

<TABLE>
<CAPTION>
                                                                               Tangible
          Price/   Current   Current             Current       Total  Equity/   Equity/     Core     Core     Core   
             LTM    Price/  Price/ T   Price/   Dividend      Assets   Assets  T Assets      EPS     ROAA     ROAE  Merger   Current
        Core EPS    Book V    Book V   Assets      Yield       ($000)     (%)       (%)      ($)      (%)      (%)  Target?  Pricing
Ticker       (x)       (%)       (%)      (%)        (%)         MRQ      MRQ       MRQ      LTM      LTM      LTM  (Y/N)       Date
<S>         <C>      <C>       <C>       <C>        <C>   <C>            <C>       <C>      <C>      <C>     <C>      <C>   <C>
SFSL        20.6     262.5     266.7     24.6       1.46     677,876      9.4       9.2     1.07     1.37    14.78    N     02/27/98
SISB        17.9     207.1     207.1     15.1       1.70   1,733,618      7.2       7.2     2.10     0.87    12.13    N     02/27/98
SKAN        17.6     155.5     159.8     10.7       1.46     256,101      6.9       6.7     1.09     0.66     9.47    N     02/27/98
SMBC        24.2     136.0     136.0     22.0       2.25     163,297     16.2      16.2     0.92     0.90     5.61    N     02/27/98
SOBI        31.1     115.5     115.5     17.9       1.56      87,553     14.4      14.4     0.66     0.61     3.95    N     02/27/98
SOPN        18.9     127.6     127.6     29.1       3.73     300,816     22.8      22.8     1.25     1.75     7.43    N     02/27/98
SPBC        18.8     216.9     217.4     19.9       1.51   4,557,336      9.2       9.2     1.41     1.09    12.25    N     02/27/98
SSB         15.6     131.0     131.0     31.5       1.98      61,473     24.1      24.1     0.65     1.65     5.17    N     02/27/98
SSFC        28.3     165.6     165.6     26.6       3.08     228,491     14.9      14.9     0.46     0.83     3.32    N     02/27/98
SSM         23.0     125.2     125.2     37.0       2.20     104,773     29.6      29.6     0.89     1.56     4.57    N     02/27/98
STFR        19.4     175.9     197.3     14.3       1.29   1,597,648      8.3       7.4     2.24     0.75     9.18    N     02/27/98
STSA        21.2     177.5     192.1      9.7         --   1,876,250      5.5       5.1     1.14     0.51     9.51    N     02/27/98
SVRN        21.3     254.6     306.6     12.6       0.41  14,336,283      5.4       4.7     0.91     0.69    12.55    N     02/27/98
SZB         26.5     135.7     135.7     13.1       2.70     165,388      9.7       9.7     0.84     0.67     5.08    N     02/27/98
THR         23.3     147.6     148.1     19.9       1.87      97,487     13.5      13.4     1.01     0.84     6.12    N     02/27/98
THRD        24.5     149.8     179.4     13.9       1.85     597,047      8.4       7.1     1.06     0.66     6.28    N     02/27/98
TPNZ        26.8     128.8     128.8     21.9       1.49     126,470     17.0      17.0     0.70     0.80     4.65    N     02/27/98
TRIC        18.2     118.2     118.2     18.2       2.86      89,999     15.4      15.4     0.77     1.05     6.89    N     02/27/98
TSH         18.4     131.3     131.3     17.8       2.37     408,591     13.5      13.5     1.15     0.94     6.97    N     02/27/98
TWIN        24.2     133.4     133.4     17.3       2.76     106,932     12.9      12.9     0.60     0.72     5.59    N     02/27/98
UBMT        22.1     133.4     133.4     32.0       3.70     103,082     24.0      24.0     1.22     1.40     6.04    N     02/27/98
VABF        29.5     206.9     206.9     14.8       1.33     605,486      7.2       7.2     0.61     0.49     7.24    N     02/27/98
WAMU        21.3     322.7     346.5     17.8       1.73  97,068,825      5.5       5.1     3.15     0.87    15.29    N     02/27/98
WBST        18.2     229.6     263.2     12.5       1.25   7,019,621      5.4       4.8     3.53     0.77    14.06    N     02/27/98
WCBI        17.8     147.1     147.1     22.6       2.35     315,944     15.4      15.4     1.63     1.41     9.14    N     02/27/98
WCFB        31.5     194.9     194.9     45.6       3.90      94,482     23.4      23.4     0.65     1.42     6.09    N     02/27/98
WEFC        16.7     124.8     124.8     18.4       2.54     201,436     14.7      14.7     1.13     1.06     7.48    N     02/27/98
WEHO        28.4     139.2     139.2     31.2       2.44     134,259     22.5      22.5     0.52     1.04     3.51    N     02/27/98
WFI         18.7     221.0     225.1     16.3       1.86     329,897      7.4       7.3     1.44     0.91    12.63    N     02/27/98
WFSL        13.7     196.1     212.7     25.3       3.16   5,713,308     12.9      12.0     2.02     1.87    15.35    N     02/27/98
WHGB        33.0     129.0     129.0     25.4       1.73     101,331     19.7      19.7     0.56     0.77     3.66    N     02/27/98
WOFC        33.4     114.3     122.5     15.9       3.74     397,425     13.9      13.1     0.80     0.43     3.16    N     02/27/98
WRNB        15.8     218.6     218.6     23.6       2.26     370,993     10.8      10.8     1.46     1.61    15.53    N     02/27/98
WSB         29.2     170.6     170.6     14.5       1.14     264,904      8.5       8.5     0.30     0.52     6.25    N     02/27/98
WSFS        16.3     298.1     299.9     17.1         --   1,515,217      5.7       5.7     1.27     1.10    20.00    N     02/27/98
WSTR        20.0     134.7     165.7     14.0       1.85   1,035,096     10.4       8.6     1.30     0.76     6.94    N     02/27/98
WVFC        17.9     214.1     214.1     22.8       3.16     292,022     10.7      10.7     2.12     1.31    11.03    N     02/27/98
WYNE        22.7     148.6     148.6     18.5       0.82     267,285     12.4      12.4     1.08     0.86     6.01    N     02/27/98
YFCB        17.5     125.7     125.7     17.0       1.50     331,802     13.5      13.5     1.07     1.04     7.00    N     02/27/98
YFED        25.0     215.4     215.4     19.1       2.04   1,182,276      8.9       8.9     1.02     0.80     9.36    N     02/27/98
                                                                                                                     
Maximum     34.2     348.3     400.5     45.6       4.92  97,068,825     40.1      40.1     6.04     3.97    44.97   
Minimum      3.4      86.3      86.3      5.4         --      36,103      3.6       3.1     0.29     0.31     2.75   
Average     21.3     173.6     181.7     19.1       1.68   1,765,084     11.9      11.7     1.31     0.99     9.37   
Median      20.6     159.7     165.7     17.8       1.63     357,691     10.1       9.9     1.12     0.94     8.28   
</TABLE>

Source: SNL & F&C calculations          10
<PAGE>
 
FERGUSON & COMPANY     Exhibit V - Selected Publicly Held Thrifts

                  NPAs/  Price/     Core     Core     Core
                 Assets    Core      EPS     ROAA     ROAE
                    (%)     EPS      ($)      (%)      (%)
Ticker              MRQ     (x)      MRQ      MRQ      MRQ

AABC               1.58     2.6     1.05     4.90    60.86
ABBK               0.17    22.8     0.23     0.71    10.20
ABCL               0.27    22.2     0.31     0.79     8.16
ABCW               0.97    20.7     0.52     1.03    15.64
AFED               0.30    20.4     0.24     0.78     6.19
AHM                1.73    17.9     0.87     0.83    16.27
ALBC               0.12    22.4     0.12     0.53     6.17
ALBK               0.70    11.1     1.10     1.55    17.41
AMFC                 NA    26.8     0.16     0.57     3.95
ANA                0.50    20.5     0.27     0.96     5.57
ANDB               0.62    15.8     0.63     1.03    12.95
ANE                1.56    38.2     0.13     0.37     5.12
ASBI               0.49    18.3     0.28     0.92     8.34
ASBP                 NA    21.5     0.16     0.89     5.73
ASFC               0.52    20.5     0.68     0.75     8.66
BANC               1.07    33.8     0.10     0.44     7.34
BDJI               0.03    20.0     0.26     0.75     7.17
BFD                0.18    21.3     0.26     0.61     7.06
BFSB                 --    21.6     0.33     1.10     7.72
BKC                2.11    18.2     0.69     1.05    12.47
BKCT               0.91    19.3     0.24     1.20    11.38
BKUNA              0.37    52.5     0.07     0.21     3.72
BNKU               0.68    19.0     0.62     0.66    13.15
BPLS               1.66    14.8     0.25     0.46    10.94
BVCC               0.51    24.8     0.35     0.58    10.33
BYFC               1.62   159.4     0.02     0.09     0.88
CAFI               0.29    24.4     0.26     0.66     6.90
CASB               0.35    20.4     0.19     0.65     9.49
CASH               0.74    17.3     0.33     0.90     8.36
CATB               0.35    20.9     0.22     1.31     5.30
CBCI               1.64    12.3     0.76     2.16    13.24
CBES               0.54    39.8     0.16     0.56     3.42
CBSA               0.71    14.5     0.54     0.38    10.86
CEBK               0.42    23.5     0.34     0.73     7.40
CENB               0.58    25.2     0.93     1.38     4.56
CFB                0.84    17.0     0.52     0.94    15.15
CFCP               0.59    21.8     0.25     0.94    15.05
CFFC               0.56    29.6     0.26     0.74     5.47
CFNC               0.10    24.7     0.18     1.11     4.88
CFSB               0.10    23.1     0.32     1.18    15.09
CFTP               0.49    31.2     0.15     1.19     4.43
CIBI               0.65    17.3     0.25     0.89     7.64
CKFB               0.10    18.8     0.26     1.39     6.13
CLAS               0.34    20.5     0.23     0.83     5.55
CMRN               0.38    22.7     0.22     0.99     4.64
CMSB               0.42    30.0     0.17     0.45     4.88
CNIT               0.45    18.8     0.95     0.91    12.75
COFI               0.30    19.9     0.76     0.96    13.56
COOP               0.07    29.8     0.17     0.61     7.90
CRZY               0.18    19.6     0.21     1.27     5.36
CVAL               0.55    22.1     0.36     0.96    11.03
DCBI               0.35    27.6     0.22     1.48     5.56
DIBK               0.29     9.4     0.83     1.88    23.11
DIME               0.53    27.3     0.23     0.78     6.08
DME                1.06    34.7     0.22     0.49     8.31
DNFC               0.29    19.3     0.34     0.70    13.21
DSL                0.89    14.1     0.52     0.94    12.99

Source: SNL & F&C calculations          11
<PAGE>
 
FERGUSON & COMPANY     Exhibit V - Selected Publicly Held Thrifts

                  NPAs/  Price/     Core     Core     Core
                 Assets    Core      EPS     ROAA     ROAE
                    (%)     EPS      ($)      (%)      (%)
Ticker              MRQ     (x)      MRQ      MRQ      MRQ

EBSI               1.18    17.1     0.30     0.81     9.69
EFBI                 --    34.8     0.24     0.70     6.28
EMLD                 NA    20.5     0.27     0.97    12.19
EQSB               0.38    17.7     0.43     0.70    13.55
ESBK               0.63    30.1     0.24     0.30     4.80
ETFS               0.33    38.8     0.14     0.44     2.48
FBBC               0.09    15.1     0.31     1.08    10.01
FBCI                 NA    18.0     0.34     0.78     7.54
FBCV               1.23    19.0     0.33     0.55     6.29
FBER               0.84    27.4     0.18     0.69     4.94
FBHC               0.47    37.3     0.14     0.37     5.83
FBSI               0.04    18.5     0.23     1.23     8.80
FCBF               0.26    18.6     0.42     1.22     8.75
FCME               1.59    19.2     0.19     0.70     7.36
FDEF               0.33    34.7     0.11     0.64     3.37
FED                0.96    17.4     0.58     0.60    11.48
FESX               0.54    19.7     0.30     0.79    10.45
FFBA               0.15    20.4     0.31     1.30     9.77
FFBH               0.96    22.4     0.29     0.97     6.49
FFBI               0.32    26.4     0.22     0.43     4.89
FFBZ               0.57    28.8     0.20     0.69     9.02
FFCH               1.35    23.9     0.55     0.87    13.66
FFDB                 NA    17.7     0.34     0.93     9.63
FFDF               0.05    39.1     0.12     0.73     3.00
FFED               0.30    24.4     0.10     0.58     8.19
FFES               0.25    16.6     0.58     0.65     9.77
FFFD                 NA    18.1     0.29     1.71     7.49
FFHH               0.22    19.4     0.26     0.74     6.74
FFHS               0.33    22.5     0.30     0.64     7.21
FFIC               0.27    21.3     0.30     0.85     6.37
FFKY               0.07    15.7     0.35     1.51    11.01
FFLC               0.19    19.4     0.25     0.97     7.40
FFOH               0.18    21.4     0.21     0.86     6.84
FFPB               0.52    36.4     0.26     0.30     4.74
FFSL               0.89    20.5     0.18     0.64     6.25
FFSX               0.14    28.8     0.27     0.70     7.82
FFWC               0.31    14.0     0.33     0.99    10.25
FFWD               0.02    30.6     0.18     1.21     9.56
FFYF               0.62    17.5     0.49     1.25     9.14
FGHC               1.64    16.7     0.15     1.12    13.49
FIBC               1.89    15.5     0.42     0.94    10.31
FISB               1.38    26.1     0.28     0.94     9.72
FKFS               1.15    17.5     0.25     0.64     9.65
FKKY                 --    16.9     0.24     1.14     6.25
FLAG               3.92    25.8     0.20     0.69     7.75
FLFC               1.00    21.5     0.35     0.87    11.61
FLGS               3.04    12.6     0.45     1.41    21.01
FLKY               2.28    31.5     0.12     0.99     3.17
FMCO               1.15    15.4     0.57     0.99    15.00
FMSB                 --    16.4     0.28     1.06    15.58
FNGB               0.09    19.1     0.17     0.91     8.19
FSBI               0.15    17.6     0.41     0.68    10.02
FSTC               1.12    19.5     0.41     1.41    14.00
FTF                0.07    17.2     0.41     1.58    10.33
FTFC               0.32    23.4     0.34     0.86    12.50
FTSB               2.04    18.5     0.21     1.24     7.75
FWWB               0.19    20.6     0.31     1.06     7.79

Source: SNL & F&C calculations          12
<PAGE>
 
FERGUSON & COMPANY     Exhibit V - Selected Publicly Held Thrifts

                  NPAs/  Price/     Core     Core     Core
                 Assets    Core      EPS     ROAA     ROAE
                    (%)     EPS      ($)      (%)      (%)
Ticker              MRQ     (x)      MRQ      MRQ      MRQ

GAF                0.22    17.5     0.28     1.01     6.92
GDW                1.07    14.0     1.60     0.94    13.98
GFCO               0.06    19.0     0.27     0.87     9.29
GPT                2.90    19.1     0.97     1.11    11.68
GSBC               1.84    16.4     0.39     1.72    20.10
GSFC               0.07    27.0     0.17     1.54     4.37
GUPB               0.24    17.0     0.30     0.82     6.50
HALL               0.09    16.7     0.24     0.68     9.10
HARB               0.51    24.5     0.72     1.28    14.72
HARL                 --    15.6     0.48     0.95    14.11
HAVN               0.66    18.0     0.34     0.63    10.79
HBBI               0.67    25.7     0.22     0.61     4.32
HBFW                 --    30.3     0.27     0.73     5.92
HBNK               1.94    13.0     0.69     1.26    16.43
HBS                0.67     8.3     0.66     2.18    15.52
HFFB                 --    20.9     0.20     1.32     4.89
HFFC               0.33    13.7     0.53     1.09    11.42
HFNC               0.79    31.0     0.11     0.82     4.43
HFSA               0.19    18.8     0.25     0.67     5.91
HHFC               0.03    26.8     0.14     0.51     4.64
HIFS               0.77    16.2     0.51     1.25    12.77
HMNF                 NA    31.5     0.23     0.60     4.36
HOMF               0.55    20.2     0.39     1.23    14.16
HPBC                 --    14.7     0.45     1.62    15.37
HRBF               0.53    28.6     0.21     0.64     4.92
HRZB                 NA    15.4     0.29     1.66    10.24
HTHR               8.06    10.5     0.47     1.46    24.29
HWEN               1.63    37.5     0.06     0.43     2.51
HZFS               0.96    20.1     0.18     0.72     7.12
IBSF               0.11    31.7     0.14     0.84     4.78
INBI               0.23    16.5     0.28     1.53     9.11
IPSW               0.95    18.8     0.19     0.92    17.15
ITLA                 NA    12.0     0.42     1.41    13.75
IWBK               0.69    21.2     0.49     0.80    12.33
JSB                1.02    21.0     0.64     1.74     7.59
JSBA               0.67    29.4     0.23     0.70     7.92
JXVL               0.70    16.0     0.32     1.33     9.18
KFBI               0.02    25.6     0.22     0.88     5.84
KNK                0.89    17.6     0.48     0.83     7.51
KSBK                 NA    14.2     0.34     1.07    14.32
KYF                0.04    21.7     0.16     0.94     5.55
LARK               0.15    16.7     0.33     0.97     6.87
LARL               0.42    17.7     0.31     1.37    12.98
LFBI               0.90    27.8     0.18     0.57     4.75
LFCO                 NA     4.9     0.81     6.33    42.71
LFED               0.03    33.8     0.16     1.14     6.83
LISB               0.89    33.4     0.45     0.69     7.61
LOGN               0.62    13.5     0.30     1.71     8.96
LONF               0.20    15.5     0.24     1.23     7.30
LSBI                 NA    16.4     0.43     0.76     8.79
LSBX               0.52     5.1     0.83     4.28    44.00
LVSB               1.14    24.9     0.26     1.00     8.70
LXMO               0.67    24.3     0.17     1.09     3.97
MAFB               0.26    16.3     0.57     1.05    13.71
MARN               1.43    24.1     0.28     1.08     5.07
MASB               0.19    19.3     0.64     1.02     9.29
MBB                  NA    28.1     0.31     0.60     6.81

Source: SNL & F&C calculations          13
<PAGE>
 
FERGUSON & COMPANY     Exhibit V - Selected Publicly Held Thrifts

                  NPAs/  Price/     Core     Core     Core
                 Assets    Core      EPS     ROAA     ROAE
                    (%)     EPS      ($)      (%)      (%)
Ticker              MRQ     (x)      MRQ      MRQ      MRQ

MBLF               0.48    20.1     0.35     0.83     6.54
MBSP               1.77    32.7     0.13     1.20     3.02
MCBN               0.85    19.5     0.49     0.75     8.84
MDBK               0.16    17.1     0.64     1.08    12.07
MECH               0.58    19.0     0.35     0.86     8.47
METF               0.52    16.8     0.25     0.75    19.14
MFBC                 --    23.3     0.29     0.76     5.82
MFFC               0.09    30.5     0.13     0.54     4.49
MFLR               0.65    18.2     0.37     1.02    10.56
MIFC               0.21    15.8     0.20     1.07    11.37
MIVI               0.43    19.1     0.24     1.06     6.30
MSBF               0.02    20.5     0.21     1.36     8.16
MWBI               0.73    16.4     0.26     0.76    10.83
MWBX               0.58    15.2     0.13     1.26    17.10
NASB               3.07    13.4     1.24     1.51    18.27
NBN                1.03    22.6     0.20     0.73     9.55
NEIB               0.17    16.9     0.33     1.28     8.66
NHTB               0.87    27.4     0.18     0.52     6.91
NMSB               0.78    16.7     0.20     1.01     9.94
NSLB               0.03    31.0     0.14     0.46     2.31
NWEQ               1.33    15.9     0.35     1.10     9.45
OCFC               0.52    19.6     0.45     0.97     6.37
OFCP               0.27    22.4     0.33     0.86    10.02
OHSL               0.03    27.0     0.34     0.70     6.43
PBCI               1.70    17.6     0.38     1.15     8.88
PBKB               0.57    35.0     0.16     0.28     6.89
PCBC               0.01    23.0     0.26     0.95     4.94
PDB                1.13    20.4     0.13     1.13     6.88
PEEK               0.77    26.6     0.16     1.01     3.92
PERM               0.70    23.8     0.31     0.63     6.47
PFDC               0.25    18.5     0.30     1.40     9.21
PFED               0.23    58.6     0.08     0.41     1.84
PFFB               1.38    20.2     0.24     0.61     6.14
PFFC               0.04    45.8     0.09     0.59     3.16
PFNC               0.50    26.4     0.16     0.64    12.09
PFSB               0.55    16.6     0.28     0.76    10.60
PFSL               0.13    33.5     0.33     0.58     9.16
PHBK               0.75    16.4     0.71     1.24    17.38
PHFC               1.68    17.1     0.26     0.67     6.86
PRBC               0.43    29.9     0.16     0.39     3.35
PTRS               0.44    19.0     0.25     0.80     8.90
PULS               0.85    15.6     0.42     1.02    12.69
PVFC               0.96    12.8     0.45     1.26    17.48
PVSA               0.36    15.3     0.52     1.08    14.56
PWBC               0.68    18.4     0.26     0.69     8.33
PWBK               0.74    34.4     0.16     0.70     3.85
QCBC               1.33    15.2     0.33     0.72     8.44
QCFB               0.39    12.0     0.57     1.68     9.90
QCSB               0.53    26.2     0.38     1.46    12.78
RARB               0.23    17.0     0.39     0.97    12.93
RELY               0.54    18.1     0.49     0.87    10.30
ROSE               0.48    17.5     0.47     0.89    14.35
SCBS               2.17    20.5     0.22     1.22     6.05
SCCB               1.53    44.8     0.12     0.62     2.61
SFED               0.82    23.4     0.23     0.56     4.63
SFFC               1.74    19.8     0.18     1.24     7.05
SFIN               0.33    17.2     0.33     0.81     8.62

Source: SNL & F&C calculations          14
<PAGE>
 
FERGUSON & COMPANY     Exhibit V - Selected Publicly Held Thrifts

                  NPAs/  Price/     Core     Core     Core
                 Assets    Core      EPS     ROAA     ROAE
                    (%)     EPS      ($)      (%)      (%)
Ticker              MRQ     (x)      MRQ      MRQ      MRQ

SFSL               0.43    19.6     0.28     1.36    14.68
SISB               0.44    15.4     0.61     0.93    13.02
SKAN               1.89    18.4     0.26     0.61     8.63
SMBC               0.88    26.5     0.21     0.83     5.09
SOBI               0.26    30.2     0.17     0.59     4.06
SOPN               0.20    18.5     0.32     1.74     7.61
SPBC               0.17    18.4     0.36     1.07    11.87
SSB                  --    28.1     0.09     1.00     4.31
SSFC               0.16      NM    (0.06)   (0.40)   (1.71)
SSM                  --    25.6     0.20     1.49     4.98
STFR               0.21    20.9     0.52     0.66     8.30
STSA               0.73    18.3     0.33     0.54    10.11
SVRN               0.63    17.3     0.28     0.80    15.13
SZB                  NA    23.2     0.24     0.67     5.94
THR                0.95    24.5     0.24     0.78     5.70
THRD               0.29    24.1     0.27     0.61     7.45
TPNZ               1.19    27.6     0.17     0.74     4.35
TRIC                 --    19.4     0.18     0.98     6.46
TSH                0.38    18.9     0.28     0.90     6.66
TWIN               0.08    19.1     0.19     0.90     6.97
UBMT               0.35    20.5     0.33     1.53     6.52
VABF               0.50    26.5     0.17     0.55     7.90
WAMU                 NA    18.7     0.90     0.95    17.13
WBST               0.65    16.2     0.99     0.81    14.99
WCBI               0.19    17.7     0.41     1.38     8.94
WCFB               0.07    32.0     0.16     1.38     5.94
WEFC                 NA    16.9     0.28     1.04     7.22
WEHO                 --      NA       NA     0.97     3.60
WFI                0.22    16.8     0.40     0.98    13.41
WFSL               0.60    13.8     0.50     1.88    14.64
WHGB               0.95    38.5     0.12     0.61     3.08
WOFC               0.44    33.4     0.20     0.40     2.89
WRNB               0.83    16.4     0.35     1.53    14.19
WSB                  NA    36.5     0.06     0.39     4.59
WSFS               1.23    17.3     0.30     1.00    17.34
WSTR               0.29    18.1     0.36     0.80     7.53
WVFC               0.20    16.4     0.58     1.44    11.95
WYNE               0.89    24.5     0.25     0.76     5.57
YFCB               0.49    18.0     0.26     0.92     6.63
YFED               1.01    27.7     0.23     0.74     8.44

Maximum            8.06   159.4     1.60    6.330   60.860
Minimum              --     2.6    (0.06)  (0.400)  (1.710)
Average            0.67    22.3     0.33    0.975    9.339
Median             0.50    19.7     0.28    0.900    8.245

Source: SNL & F&C calculations          15
<PAGE>
 
                                  EXHIBIT VI
<PAGE>
 
FERGUSON & COMPANY
- ------------------

                   EXHIBIT VI - COMPARATIVE GROUP SELECTION

To search for a comparative group for Northfield, we selected all thrifts from
the entire U.S. with assets under $100 million that have sufficient trading
volume to produce meaningful market information. All of these thrifts are listed
on either AMEX, NYSE, or Nasdaq.

We found 49 thrifts in the asset size described above. We eliminated 39 and
retained a group of 10. Normally, we consider 10 to 12 to be the desired sample
size.

We eliminated thrifts for the following reasons: 1) Mutual holding company; 2)
No PE for the last quarter or PE ratio for the last quarter greater than 35; 3)
Tangible equity less than 10% of assets or greater than 25% of assets; 4) Merger
agreement has been executed; 5) Non-performing assets greater than 1.5% of
assets; 6) Loans less than 50% of assets; and 7) Loans serviced greater than 20%
of assets.

After eliminating thrifts as discussed above, we had 17 left. We then eliminated
all thrifts with assets over $85 million, eliminating 7 and reducing our group
to 10.

The group of 49 from which the comparative group was selected is listed on
Exhibit VI.1 and the selected comparative group is listed on Exhibit VI.2. On
Exhibit VI.1, we have blocked the cells that indicate which ones were not
selected and why. Set forth below is a legend for the column summarizing reasons
individual thrifts were not selected.

A  Mutual holding company.

B  No core EPS for most recent quarter or PR ratio over 35.

C  Assets greater than $85 million.

D  Equity either less than 10% of assets or greater than 25% of assets.

E  Merger agreement has been executed.

F  Non-performing assets greater than 1.5% of total assets.

G  Loans less than 50% of assets.

H  Loans serviced exceeds 20% of assets.

                                                                 1
<PAGE>
 
FERGUSON & COMPANY              EXHIBIT VI.1 - COMPARATIVE GROUP SELECTION
- ------------------


                 A
<TABLE> 
<CAPTION> 
                                                                           Deposit                          Current Current   Price/
                                                                           Insurance                          Stock  Market      LTM
                                                                           Agency                             Price   Value Core EPS
Ticker   Short Name                       City             State  Region   (BIF/SAIF)  Exchange  IPO Date      ($)    ($M)       (x)
<S>      <C>                              <C>              <C>    <C>      <C>         <C>       <C>        <C>       <C>       <C> 
ALBC     Albion Banc Corp.                Albion           NY     MA       SAIF        NASDAQ    07/26/93   28.000    7.00      21.4
ATSB     AmTrust Capital Corp.            Peru             IN     MW       SAIF        NASDAQ    03/28/95   13.750    7.24      40.4
CIBI     Community Investors Bancorp      Bucyrus          OH     MW       SAIF        NASDAQ    02/07/95   15.750   14.21      15.0
CKFB     CKF Bancorp Inc.                 Danville         KY     MW       SAIF        NASDAQ    01/04/95   18.500   16.71      19.7
CNSB     CNS Bancorp Inc.                 Jefferson City   MO     MW       SAIF        NASDAQ    06/12/96   21.500   35.54      41.4
CRZY     Crazy Woman Creek Bancorp        Buffalo          WY     WE       SAIF        NASDAQ    03/29/96   15.375   14.68      20.8
CSBF     CSB Financial Group Inc.         Centralla        IL     MW       SAIF        NASDAQ    10/09/95   13.250   12.48      49.1
FCB      Falmouth Bancorp Inc.            Falmouth         MA     NE       BIF         AMSE      03/28/96   20.000   29.10      40.0
FFBI     First Financial Bancorp Inc.     Belvidere        IL     MW       SAIF        NASDAQ    10/04/93   21.000    8.72      23.1
FFDF     FFD Financial Corp.              Dover            OH     MW       SAIF        NASDAQ    04/03/96   18.625   26.91      30.0
FLKY     First Lancaster Bancshares       Lancaster        KY     MW       SAIF        NASDAQ    07/01/96   15.750   14.98      28.6
FTSB     Fort Thomas Financial Corp.      Fort Thomas      KY     MW       SAIF        NASDAQ    06/28/95   15.500   23.17      19.6
GFSB     GFS Bancorp Inc.                 Grinnell         IA     MW       SAIF        NASDAQ    01/06/94   17.063   16.86      15.2
GWBC     Gateway Bancorp Inc.             Catlettsburg     KY     MW       SAIF        NASDAQ    01/18/95   18.750   20.28      31.8
HBBI     Home Building Bancorp            Washington       IN     MW       SAIF        NASDAQ    02/08/95   21.250    6.62      18.8
HCFC     Home City Financial Corp.        Springfield      OH     MW       SAIF        NASDAQ    12/30/96   17.250   15.60        NA
HHFC     Harvest Home Financial Corp.     Chevlot          OH     MW       SAIF        NASDAQ    10/10/94   14.750   13.49      27.8
HWEN     Home Financial Bancorp           Spencer          IN     MW       SAIF        NASDAQ    07/02/96   17.625    8.19      27.1
HZFS     Horizon Financial Svcs Corp.     Oskaloosa        IA     MW       SAIF        NASDAQ    06/30/94   11.750   10.00      18.7
INCB     Indiana Community Bank SB        Lebanon          IN     MW       SAIF        NASDAQ    12/15/94   20.500   18.90      39.4
JOAC     Joachim Bancorp Inc.             De Soto          MO     MW       SAIF        NASDAQ    12/28/95   15.000   10.84      39.5
KYF      Kentucky First Bancorp Inc.      Cynthiana        KY     MW       SAIF        AMSE      08/29/95   14.688   19.06      18.6
LOGN     Logansport Financial Corp.       Logansport       IN     MW       SAIF        NASDAQ    06/14/95   15.250   19.22      16.2
LONF     London Financial Corporation     London           OH     MW       SAIF        NASDAQ    04/01/96   15.250    7.86      20.1
LXMO     Lexington B&L Financial Corp.    Lexington        MO     MW       SAIF        NASDAQ    06/06/96   17.125   19.50      22.5
MBSP     Mitchell Bancorp Inc.            Spruce Pine      NC     SE       SAIF        NASDAQ    07/12/96   17.250   16.06      27.8
MCBN     Mid-Coast Bancorp Inc.           Waldoboro        ME     NE       SAIF        NASDAQ    11/02/89   28.750    6.70      15.6
MIVI     Mississippi View Holding Co.     Little Falls     MN     MW       SAIF        NASDAQ    03/24/95   17.500   12.95      18.4
MRKF     Market Financial Corp.           Mount Healthy    OH     MW       SAIF        NASDAQ    03/27/97   15.438   20.62        NA
MSBF     MSB Financial Inc.               Marshall         MI     MW       SAIF        NASDAQ    02/06/95   19.500   24.06      22.7
NSLB     NS&L Bancorp Inc.                Neosho           MO     MW       SAIF        NASDAQ    06/08/95   18.500   13.09      30.8
NWEQ     Northwest Equity Corp.           Amery            WI     MW       SAIF        NASDAQ    10/11/94   19.250   16.15      16.0
OSFS     Ohio State Financial Services    Bridgeport       OH     MW       SAIF        NASDAQ    09/29/97   15.000    9.51        NA
PCBC     Perry County Financial Corp.     Perryville       MO     MW       SAIF        NASDAQ    02/13/95   23.250   19.25      17.2
PFFC     Peoples Financial Corp.          Massillon        OH     MW       SAIF        NASDAQ    09/13/96   13.750   20.15        NA
PSFI     PS Financial Inc.                Chicago          IL     MW       SAIF        NASDAQ    11/27/96   18.500   38.36        NA
PWBK     Pennwood Bancorp Inc.            Pittsburgh       PA     MA       SAIF        NASDAQ    07/15/96   18.500   10.54      19.9
RELI     Reliance Bancshares Inc.         Milwaukee        WI     MW       SAIF        NASDAQ    04/19/96    8.875   21.94      35.5
SCBS     Southern Community Bancshares    Cullman          AL     SE       SAIF        NASDAQ    12/23/96   19.000   21.61        NA
SCCB     S. Carolina Community Bancshrs   Winnsboro        SC     SE       SAIF        NASDAQ    07/07/94   22.500   15.72      28.9
SFFC     StateFed Financial Corp.         Des Moines       IA     MW       SAIF        NASDAQ    01/05/94   13.375   20.83      18.6
SHSB     SHS Bancorp Inc.                 Pittsburgh       PA     MA       SAIF        NASDAQ    10/01/97   17.250   14.14        NA
SOBI     Sobieski Bancorp Inc.            South Bend       IN     MW       SAIF        NASDAQ    03/31/95   19.375   15.10      31.8
SSB      Scotland Bancorp Inc.            Laurinburg       NC     SE       SAIF        AMSE      04/01/96   10.250   19.61      13.9
SZB      SouthFirst Bancshares Inc.       Sylacauga        AL     SE       SAIF        AMSE      02/14/95   20.625   17.48     108.6
THR      Three Rivers Financial Corp.     Three Rivers     MI     MW       SAIF        AMSE      08/24/95   20.250   16.68      20.1
TRIC     Tri-County Bancorp Inc.          Torrington       WY     WE       SAIF        NASDAQ    09/30/93   14.750   17.22      18.9
USAB     USABancshares, Inc.              Philadelphia     PA     MA       BIF         NASDAQ          NA    9.625    7.05      37.0
WCFB     Webster City Federal SB (MHC)    Webster City     IA     MW       SAIF        NASDAQ    08/15/94   21.250   44.63      32.7

Maximum                                                                                                     28.750   44.63     108.6
Minimum                                                                                                      8.875    6.62      13.9
Average                                                                                                     17.460   17.07      27.6
Median                                                                                                      17.250   16.15      22.6

</TABLE> 
                                       2

SOURCE:  SNL & F&C CALCULATIONS
<PAGE>
 
FERGUSON & COMPANY              EXHIBIT VI.1 - COMPARATIVE GROUP SELECTION
- ------------------

<TABLE> 
<CAPTION> 
             B                                                    C        D                                                 
                                                                                    Tangible               ROAA      ROACE    
          Price/    Current    Current             Current      Total   Equity/      Equity/     Core    Before     Before    
            Core     Price/   Price/ T    Price/  Dividend     Assets    Assets     T Assets      EPS     Extra      Extra    
             EPS    B Value    B Value    Assets     Yield     ($000)       (%)          (%)      ($)       (%)        (%)    
Ticker       (x)        (%)        (%)       (%)       (%)        MRQ       MRQ          MRQ      LTM       LTM        LTM    
<S>      <C>          <C>        <C>       <C>       <C>       <C>        <C>          <C>      <C>       <C>        <C> 
ALBC        18.9      115.5      115.5       9.9      1.14     70,810       8.6          8.6     1.31      0.50       5.54   
ATSB        57.3       95.1       96.0      10.4      1.46     69,685      10.9         10.8     0.34      0.40       3.86   
CIBI        14.1      130.3      130.3      15.3      2.03     94,328      11.8         11.8     1.05      0.97       8.37   
CKFB        17.8      109.4      109.4      27.9      2.70     59,868      23.7         23.7     0.94      1.82       7.51   
CNSB        41.4      149.9      149.9      36.5      1.12     97,411      24.3         24.3     0.52      0.79       3.20   
CRZY        18.3      103.3      103.3      24.5      2.60     59,952      23.7         23.7     0.74      1.28       4.74   
CSBF        55.2      102.0      108.0      25.6         -     48,844      25.0         24.0     0.27      0.31       1.21   
FCB         35.7      127.6      127.6      30.2      1.00     96,391      23.7         23.7     0.50      0.83       3.36   
FFBI        23.9      116.0      116.0      10.4         -     84,242       8.9          8.9     0.91     (0.04)     (0.54)  
FFDF        27.4      125.3      125.3      30.5      1.61     88,220      24.3         24.3     0.62      1.93       7.83   
FLKY        32.8      107.7      107.7      31.8      3.18     47,184      29.5         29.5     0.55      1.24       3.64   
FTSB        16.9      146.8      146.8      23.7      1.61     97,843      16.1         16.1     0.79      1.22       7.18   
GFSB        14.7      155.0      155.0      17.8      1.52     94,496      11.5         11.5     1.12      1.27      11.01   
GWBC        58.6      116.1      116.1      32.2      2.13     62,609      27.7         27.7     0.59      0.94       3.60   
HBBI        19.7      104.0      104.0      15.9      1.41     41,746      14.1         14.1     1.13      0.75       5.76   
HCFC        14.9      113.5      113.5      22.3      2.09     70,110      19.6         19.6       NA      1.23       6.40   
HHFC        19.4      130.4      130.4      15.4      2.98     87,596      11.8         11.8     0.53      0.30       2.31   
HWEN        31.5      112.9      112.9      19.8      1.14     41,309      17.6         17.6     0.65      0.85       4.60   
HZFS        14.0      114.4      114.4      11.4      1.53     87,784      10.0         10.0     0.63      0.81       7.85   
INCB        34.2      165.6      165.6      19.7      1.76     96,089      11.9         11.9     0.52      0.53       4.30   
JOAC        41.7      109.8      109.8      30.9      3.33     35,073      28.1         28.1     0.38      0.79       2.72   
KYF         17.5      130.1      130.1      21.7      3.40     88,089      16.7         16.7     0.79      1.15       6.64   
LOGN        15.9      118.6      118.6      22.4      2.62     85,801      18.9         18.9     0.94      1.42       7.28   
LONF        17.3      103.3      103.3      20.6      1.57     38,210      19.9         19.9     0.76      1.03       4.96   
LXMO        19.5      116.3      116.3      32.9      1.75     59,236      28.3         28.3     0.76      1.02       3.45   
MBSP        28.8      112.3      112.3      46.4      2.32     34,591      41.4         41.4     0.62      1.62       3.79   
MCBN        14.4      126.9      126.9      10.9      1.81     61,473       8.6          8.6     1.84      0.76       8.73   
MIVI        19.0      107.4      107.4      18.9      0.91     68,546      17.6         17.6     0.95      1.07       6.04   
MRKF        25.7      103.7      103.7      36.7      1.81     56,121      35.5         35.5       NA      0.99       3.66   
MSBF        22.2      188.8      188.8      31.2      1.44     77,014      16.5         16.5     0.86      1.50       8.42   
NSLB        24.3      112.1      112.1      21.9      2.70     59,711      19.6         19.6     0.60      0.49       2.39   
NWEQ        15.0      132.5      132.5      16.7      2.91     96,954      11.7         11.7     1.20      1.03       8.75   
OSFS          NA       91.1       91.1      24.7         -     38,559      27.1         27.1       NA      0.98         NA   
PCBC        19.4      123.6      123.6      23.7      1.72     81,105      19.2         19.2     1.35      0.93       4.97   
PFFC        24.6       87.1       87.1      23.7      3.64     86,486      27.2         27.2       NA      0.59       2.31   
PSFI        24.3      125.3      125.3      46.8      2.60     85,698      37.3         37.3       NA      2.03       5.26   
PWBK        19.3      120.6      120.6      22.1      1.73     47,645      18.3         18.3     0.93      0.99       5.20   
RELI        31.7       96.7       96.7      46.7         -     46,987      48.3         48.3     0.25      1.32       2.58   
SCBS        22.6      144.1      144.1      30.7      1.58     70,370      21.3         21.3       NA      0.55         NA   
SCCB        31.3      129.7      129.7      34.5      2.67     45,619      26.6         26.6     0.78      1.15       4.37   
SFFC        22.3      135.7      135.7      23.8      1.50     87,542      17.5         17.5     0.72      1.28       7.20   
SHSB          NA         NA         NA        NA         -     88,460      13.3         13.3       NA      0.45         NA   
SOBI        26.9      112.3      112.3      17.9      1.65     84,279      14.8         14.8     0.61      0.62       3.88   
SSB         10.7      134.7      134.7      30.5      2.93     64,399      22.6         22.6     0.74      1.89       6.39   
SZB         34.4      128.4      128.4      18.0      2.42     97,283      14.0         14.0     0.19     (0.03)     (0.20)  
THR         18.8      128.6      129.1      17.7      1.98     94,216      13.8         13.7     1.01      0.90       6.48   
TRIC        17.6      127.5      127.5      19.5      2.71     88,173      15.3         15.3     0.78      1.05       7.13   
USAB        16.0      143.0      145.2      11.0         -     64,269       8.4          8.3     0.26      0.53       4.57   
WCFB        33.2      202.0      202.0      47.2      3.77     94,481      23.4         23.4     0.65      1.42       6.09   
                                                                                                                             
Maximum     58.6      202.0      202.0      47.2      3.77     97,843      48.3         48.3     1.84      2.03      11.01   
Minimum     10.7       87.1       87.1       9.9         -     34,591       8.4          8.3     0.19     (0.04)     (0.54)  
Average     25.1      123.6      123.8      24.6      1.85     71,896      20.1         20.1     0.75      0.97       5.10   
Median      22.2      119.6      119.6      23.1      1.75     70,810      18.9         18.9     0.74      0.98       4.97   
                                                                                                                             

           E                          F
                                                                                                              
                                     NPAs/                                                                    
         Merger        Current      Assets                                                                    
         Target?       Pricing         (%) 
Ticker     (Y/N)          Date         MRQ                                                                                   
<S>        <C>        <C>           <C>                                                                                           
ALBC           N      12/12/97       0.12                                                                                    
ATSB           N      12/12/97       2.20                                                                                    
CIBI           N      12/12/97       0.53                                                                                    
CKFB           N      12/12/97       0.70                                                                                    
CNSB           N      12/12/97       0.50                                                                                    
CRZY           N      12/12/97       0.38                                                                                    
CSBF           N      12/12/97       0.56                                                                                    
FCB            N      12/12/97         NA                                                                                    
FFBI           N      12/12/97       0.32                                                                                    
FFDF           N      12/12/97         NA                                                                                    
FLKY           N      12/12/97       2.28                                                                                    
FTSB           N      12/12/97       1.91                                                                                    
GFSB           Y      12/12/97       0.98                                                                                    
GWBC           Y      12/12/97       0.76                                                                                    
HBBI           N      12/12/97       0.44                                                                                    
HCFC           N      12/12/97       0.82                                                                                    
HHFC           N      12/12/97       0.11                                                                                    
HWEN           N      12/12/97       1.70                                                                                    
HZFS           N      12/12/97       0.71                                                                                    
INCB           Y      12/12/97         NA                                                                                    
JOAC           N      12/12/97       0.20                                                                                    
KYF            N      12/12/97       0.04                                                                                    
LOGN           N      12/12/97       0.49                                                                                    
LONF           N      12/12/97         NA                                                                                    
LXMO           N      12/12/97       0.48                                                                                    
MBSP           N      12/12/97       2.25                                                                                    
MCBN           N      12/12/97       0.55                                                                                    
MIVI           N      12/12/97         NA                                                                                    
MRKF           N      12/12/97          -                                                                                    
MSBF           N      12/12/97       0.02                                                                                    
NSLB           N      12/12/97       0.02                                                                                    
NWEQ           N      12/12/97       1.42                                                                                    
OSFS           N      12/12/97       0.44                                                                                    
PCBC           N      12/12/97       0.03                                                                                    
PFFC           N      12/12/97          -                                                                                      
PSFI           N      12/12/97       0.68                                                                                    
PWBK           N      12/12/97       0.94                                                                                    
RELI           N      12/12/97          -                                                                                    
SCBS           N      12/12/97       2.16                                                                                    
SCCB           N      12/12/97       0.87                                                                                    
SFFC           N      12/12/97       2.19                                                                                    
SHSB           N      12/12/97       1.42                                                                                    
SOBI           N      12/12/97       0.13                                                                                    
SSB            N      12/12/97         NA                                                                                    
SZB            N      12/12/97       0.53                                                                                    
THR            N      12/12/97       0.87                                                                                    
TRIC           N      12/12/97          -                                                                                    
USAB           N      12/12/97       0.57                                                                                    
WCFB           N      12/12/97       0.07                                                                                    
                                                                                                                             
Maximum                              2.28                                                                                    
Minimum                                 -                                                                                    
Average                              0.73                                                                                    
Median                               0.53   
                                                                                                                     
</TABLE> 
                                                         
                                                                 3
SOURCE:  SNL & F&C CALCULATIONS
<PAGE>
 
FERGUSON & COMPANY              EXHIBIT VI.1 - COMPARATIVE GROUP SELECTION
- ------------------

<TABLE> 
<CAPTION> 
                             G                                                      H                          
                                                                       Loans        Loans                                   
               Loans/     Loans/    Deposits/     Borrowings/       Serviced    Serviced/                      
             Deposits     Assets       Assets          Assets     For Others       Assets                      
                  (%)        (%)          (%)             (%)         ($000)          (%)                      
Ticker            MRQ        MRQ          MRQ             MRQ            MRY          MRY      Reasons Excluded
                                                                                               ----------------
<S>             <C>        <C>          <C>             <C>         <C>             <C>        <C>         
ALBC            92.67      71.80        77.48           13.07        11,080          15.6      D             
ATSB           102.96      71.52        69.47           18.78        29,025          41.7      B, F, H       
CIBI           107.50      84.42        78.53            9.05           486           0.5      C             
CKFB           129.49      92.32        71.29            3.71             -             -      Selected      
CNSB            93.03      69.68        74.91               -        21,852          22.4      B, C, H       
CRZY            98.07      48.27        49.22           26.19            77           0.1      G             
CSBF            74.99      55.73        74.31               -             -             -      B, D          
FCB                NA         NA        74.89            0.77            NA            NA      B, C, H       
FFBI            83.44      67.21        80.54            9.73        52,602          62.4      D, H          
FFDF           103.14      66.97        64.93            9.39             -             -      C             
FLKY           190.54      90.69        47.59           21.02             -             -      D, F          
FTSB           124.42      91.37        73.44            9.04             -             -      C, F          
GFSB           130.67      85.38        65.34           21.64        33,665          35.6      C, E, H       
GWBC            47.93      34.34        71.65               -             -             -      B, D, E, G    
HBBI            90.93      68.65        75.50            9.58             -             -      Selected      
HCFC           116.70      85.94        73.64            6.15         2,632           3.8      Selected      
HHFC            79.16      51.58        65.15           22.43           350           0.4      C             
HWEN           136.66      85.56        62.61           19.37             -             -      F             
HZFS            97.51      62.52        64.12           25.16         1,613           1.8      C             
INCB            87.84      76.66        87.28               -           770           0.8      C, E, H       
JOAC           100.35      70.44        70.19               -             -             -      B, D          
KYF             90.77      56.42        62.15           20.17             -             -      C             
LOGN            99.17      71.36        71.96            6.41             -             -      C             
LONF            99.00      77.60        78.39            0.79            NA            NA      Selected      
LXMO           107.94      76.69        71.05               -        21,106          35.6      H             
MBSP           151.12      83.76        55.42               -             -             -      D, F          
MCBN           112.62      81.53        72.40           18.61         7,270          11.8      D             
MIVI               NA         NA        80.51               -             -             -      Selected      
MRKF            75.22      47.32        62.91               -             -             -      D, G          
MSBF           169.02      92.01        54.44           27.61        32,757          42.5      H             
NSLB            75.61      55.74        73.72            5.02             -             -      Selected      
NWEQ           127.25      82.18        64.58           23.09        25,250          26.0      C, H          
OSFS            89.49      63.95        71.46               -             -             -      C             
PCBC            21.97      16.44        74.83            5.55             -             -      G             
PFFC            84.64      60.45        71.43               -             -             -      D             
PSFI            86.24      41.58        48.21            9.92             -             -      C, D, G       
PWBK            79.26      60.79        76.69            3.06           149           0.3      Selected      
RELI           153.59      57.86        37.67           12.86             -             -      D             
SCBS            75.43      58.98        78.19               -             -             -      F             
SCCB           109.53      79.44        72.53               -             -             -      D             
SFFC           130.17      77.82        59.78           21.70             -             -      C, F          
SHSB            89.35      65.63        73.46           12.05           476           0.5      B, C, H       
SOBI           110.72      76.81        69.37           15.44             -             -      Selected      
SSB            108.28      72.54        66.99            8.54            NA            NA      Selected      
SZB            114.80      73.80        64.29           19.01             -             -        C           
THR            105.19      67.97        64.62           19.89        12,581          13.4        C           
TRIC            83.25      44.68        53.66           29.89           163           0.2        C, G        
USAB            73.78      53.03        71.88           18.99             -             -        Selected    
WCFB            76.90      57.76        75.11            0.27             -             -        A, C        
                                                                                                             
Maximum        190.54      92.32        87.28           29.89        52,602          62.4                    
Minimum         21.97      16.44        37.67               -             -             -                    
Average        101.88      67.77        68.36           10.28         5,520           6.9                    
Median          99.00      69.68        71.43            9.05             -             -                     
</TABLE> 
                                                               
                                       4
Source:  SNL & F&C calculations          
<PAGE>
 
FERGUSON & COMPANY       Exhibit VI.2 - Comparative Group Selected
- ------------------ 

<TABLE> 
<CAPTION> 

                                                                                                                  
                                                                              Deposit                             
                                                                              Insurance                           
                                                                              Agency                              
Ticker      Short Name                      City              State  Region   (BIF/SAIF)   Exchange    IPO Date   
<C>         <S>                            <C>              <C>     <C>      <C>          <C>          <C>        
CKFB        CKF Bancorp Inc.                Danville          KY     MW       SAIF         NASDAQ       01/04/95  
HBBI        Home Building Bancorp           Washington        IN     MW       SAIF         NASDAQ       02/08/95  
HCFC        Home City Financial Corp.       Springfield       OH     MW       SAIF         NASDAQ       12/30/96  
LONF        London Financial Corporation    London            OH     MW       SAIF         NASDAQ       04/01/96  
MIVI        Mississippi View Holding Co.    Little Falls      MN     MW       SAIF         NASDAQ       03/24/95  
NSLB        NS&L Bancorp Inc.               Neosho            MO     MW       SAIF         NASDAQ       06/08/95  
PWBK        Pennwood Bancorp Inc.           Pittsburgh        PA     MA       SAIF         NASDAQ       07/15/96  
SOBI        Sobieski Bancorp Inc.           South Bend        IN     MW       SAIF         NASDAQ       03/31/95  
SSB         Scotland Bancorp Inc.           Laurinburg        NC     SE       SAIF         AMSE         04/01/96  
USAB        USABancshares, Inc.             Philadelphia      PA     MA       BIF          NASDAQ       NA        
                                                                                                                  
Maximum                                                                                                           
Minimum                                                                                                           
Average                                                                                                           
Median                                                                                                            
</TABLE> 

           
                              
           Current    Current    Price/
            Stock     Market      LTM
            Price      Value    Core EPS
Ticker      ($)       ($M)        (X)

CKFB        18.500     16.71      19.7
HBBI        21.250      6.62      18.8
HCFC        17.250     15.60       NA
LONF        15.250      7.86      20.1
MIVI        17.500     12.95      18.4
NSLB        18.500     13.09      30.8
PWBK        18.500     10.54      19.9
SOBI        19.375     15.10      31.8
SSB         10.250     19.61      13.9
USAB         9.625      7.05      37.0
           
Maximum     21.250     19.61      37.0
Minimum      9.625      6.62      13.9
Average     16.600     12.51      23.4
Median      18.000     13.02      19.9


                                       5
<PAGE>
 
FERGUSON & COMPANY       Exhibit VI.2 - Comparative Group Selected
- ------------------ 

<TABLE> 
<CAPTION> 
                                                                                             
             Price/    Current    Current             Current     Total    Equity/ 
              Core     Price/   Price/ T    Price/   Dividend    Assets     Assets 
               EPS    B Value    B Value    Assets     Yield     ($000)       (%)  
Ticker       (x)        (%)        (%)       (%)        (%)       MRQ        MRQ   
<S>         <C>       <C>       <C>        <C>        <C>      <C>        <C>      
CKFB         17.8      109.4      109.4      27.9      2.70     59,868      23.7   
HBBI         19.7      104.0      104.0      15.9      1.41     41,746      14.1   
HCFC         14.9      113.5      113.5      22.3      2.09     70,110      19.6   
LONF         17.3      103.3      103.3      20.6      1.57     38,210      19.9   
MIVI         19.0      107.4      107.4      18.9      0.91     68,546      17.6   
NSLB         24.3      112.1      112.1      21.9      2.70     59,711      19.6   
PWBK         19.3      120.6      120.6      22.1      1.73     47,645      18.3   
SOBI         26.9      112.3      112.3      17.9      1.65     84,279      14.8   
SSB          10.7      134.7      134.7      30.5      2.93     64,399      22.6   
USAB         16.0      143.0      145.2      11.0      -        64,269       8.4   
                                                                                   
Maximum      26.9      143.0      145.2      30.5      2.93     84,279      23.7   
Minimum      10.7      103.3      103.3      11.0      -        38,210       8.4   
Average      18.6      116.0      116.2      20.9      1.77     59,878      17.9   
Median       18.4      112.2      112.2      21.2      1.69     62,069      19.0   
</TABLE> 

<TABLE> 
<CAPTION> 
            Tangible           ROAA       ROACE 
            Equity/    Core    Before     Before                          NPAs/      
           T Assets     EPS     Extra     Extra     Merger     Current    Assets      
               (%)     ($)       (%)       (%)     Target?     Pricing       (%)      
Ticker        MRQ     LTM       LTM        LTM      (Y/N)         Date       MRQ      
<S>        <C>     <C>         <C>       <C>        <C>        <C>          <C> 
CKFB         23.7     0.94      1.82      7.51        N         12/12/97     0.70     
HBBI         14.1     1.13      0.75      5.76        N         12/12/97     0.44     
HCFC         19.6    NA         1.23      6.40        N         12/12/97     0.82     
LONF         19.9     0.76      1.03      4.96        N         12/12/97    NA        
MIVI         17.6     0.95      1.07      6.04        N         12/12/97    NA        
NSLB         19.6     0.60      0.49      2.39        N         12/12/97     0.02     
PWBK         18.3     0.93      0.99      5.20        N         12/12/97     0.94     
SOBI         14.8     0.61      0.62      3.88        N         12/12/97     0.13     
SSB          22.6     0.74      1.89      6.39        N         12/12/97    NA        
USAB          8.3     0.26      0.53      4.57        N         12/12/97     0.57     
                                                                                      
Maximum      23.7     1.13      1.89      7.51                               0.94     
Minimum       8.3     0.26      0.49      2.39                               0.02     
Average      17.9     0.77      1.04      5.31                               0.52     
Median       19.0     0.76      1.01      5.48                               0.57      
</TABLE> 


                                  6         
<PAGE>
 
FERGUSON & COMPANY       Exhibit VI.2 - Comparative Group Selected
- ------------------ 

<TABLE> 
<CAPTION> 
                                                                  Loans       Loans       
            Loans/     Loans/    Deposits/     Borrowings/      Serviced   Serviced/       
          Deposits     Assets       Assets          Assets    For Others      Assets      
               (%)        (%)          (%)             (%)         ($000)        (%)      
Ticker         MRQ        MRQ          MRQ             MRQ           MRY         MRY      
<S>         <C>         <C>          <C>              <C>        <C>           <C> 
CKFB         129.49      92.32        71.29            3.71          -           -        
HBBI          90.93      68.65        75.50            9.58          -           -        
HCFC         116.70      85.94        73.64            6.15      2,632           3.8      
LONF          99.00      77.60        78.39            0.79         NA          NA        
MIVI          NA         NA           80.51            -             -           -        
NSLB          75.61      55.74        73.72            5.02          -           -        
PWBK          79.26      60.79        76.69            3.06        149           0.3      
SOBI         110.72      76.81        69.37           15.44          -           -        
SSB          108.28      72.54        66.99            8.54         NA          NA        
USAB          73.78      53.03        71.88           18.99          -           -        
                                                                                          
Maximum      129.49      92.32        80.51           18.99      2,632           3.8      
Minimum       73.78      53.03        66.99            -             -           -        
Average       98.20      71.49        73.80            7.13        348           0.5      
Median        99.00      72.54        73.68            5.59          -           -        
</TABLE> 
 
                                       7
<PAGE>
 
                                  EXHIBIT VII
<PAGE>
 
FERGUSON & COMPANY                Exhibit VII
- ------------------
                              Pro Forma Assumption


1. Net proceeds from the conversion were invested at the beginning of the period
at 5.55%, which was the approximate rate on the one-year treasury bill on
December 31, 1997. This rate was selected because it is considered more
representative of the rate the Bank is likely to earn.

2. Northfield's ESOP will acquire 8% of the conversion stock with loan proceeds
obtained from the Holding Company; therefore, there will be no interest expense.
We assumed that the ESOP expense is 1/12 annually of the initial purchase.

3. Northfield's RP will acquire 4% of the stock through open market purchases at
$10 per share and the expense is recognized ratably over five years as the
shares vest.

4. All pro forma income and expense items are adjusted for income taxes at a
combined state and federal rate of 38.0%.

5. In calculating the pro forma adjustments to net worth, the ESOP and RP are
deducted in accordance with generally accepted accounting principles.

6. Earnings per share ("EPS") calculations have ignored AICPA SOP 93-6.
Calculating EPS under SOP 93-6 and assuming 1/12 of the ESOP shares are
committed to be released and allocated to the individual accounts at the
beginning of the period would yield EPS of $1.00, $.89, $.80, and $.72, and
price to earnings ratios of 10.0, 11.2, 12.5, and 13.9, at the minimum,
midpoint, maximum, and supermaximum of the range, respectively.


                                       1
<PAGE>
 
FERGUSON & COMPANY
- ------------------

                                   Exhibit VII
                     Pro Forma Effect of Conversion Proceeds
                At the Minimum of the Conversion Valuation Range
                     Valuation Date as of February 27, 1998

<TABLE> 
<CAPTION> 

Northfield Federal Savings
- ------------------------------------------------------------------------------------
<S>                                                                                   <C> 
1.    Conversion Proceeds                                                                 
      Pro Forma Market Value                                                          $      3,825,000
      Less:  Estimated Expenses                                                               (362,000)
                                                                                      -----------------
      Net Conversion Proceeds                                                         $      3,463,000
                                                                                            
2.    Estimated Additional Income From Conversion Proceeds                                  
      Net Conversion Proceeds                                                         $      3,463,000
      Less:  ESOP Contributions                                                               (306,000)
                  RP Contributions                                                            (153,000)
                                                                                      -----------------
      Net Conversion Proceeds after ESOP & RP                                         $      3,004,000
      Estimated Incremental Rate of Return(1)                                                    3.44%
                                                                                      -----------------
      Estimated Additional Income                                                     $        103,368
      Less:  ESOP Expense                                                                      (15,810)
                  RP Expense                                                                   (18,972)
                                                                                      -----------------
                                                                                      $         68,586
                                                                                      -----------------
</TABLE> 

3.    Pro Forma Calculations


<TABLE> 
<CAPTION> 
                                                 Before              Conversion               After
      Period                                   Conversion              Results              Conversion
                                         -------------------------------------------------------------------
<S>                                              <C>                     <C>                   <C> 
a.    Pro Forma Earnings
      Twelve Months Ended
      December 31, 1997                           $    287,000           $    68,586           $    355,586
                                                                                              
b.    Pro Forma Net Worth                                                                     
      December 31, 1997                           $  2,894,000           $ 3,004,000           $  5,898,000
                                                                                              
c.    Pro Forma Net Assets                                                                    
      December 31, 1997                           $ 36,084,000           $ 3,004,000           $ 39,088,000
</TABLE> 

(1) Assumes Proceeds can be reinvested at 5.55 percent and earnings taxed at a
    rate of 38.0 percent.

                                       2
<PAGE>
 
FERGUSON & COMPANY
- ------------------

                                   Exhibit VII
                     Pro Forma Effect of Conversion Proceeds
                At the Midpoint of the Conversion Valuation Range
                     Valuation Date as of February 27, 1998

<TABLE> 
<CAPTION> 

Northfield Federal Savings
- --------------------------------------------------------------------------------------
<S>                                                                                            <C> 
1.    Conversion Proceeds
      Pro Forma Market Valuation                                                                $ 4,500,000
      Less:  Estimated Expenses                                                                    (375,000)
                                                                                      ----------------------
      Net Conversion Proceeds                                                                   $ 4,125,000

2.    Estimated Additional Income From Conversion Proceeds
      Net Conversion Proceeds                                                                   $ 4,125,000
      Less:  ESOP Contributions                                                                    (360,000)
                  RP Contributions                                                                 (180,000)
                                                                                      ----------------------
      Net Conversion Proceeds after ESOP & RP                                                   $ 3,585,000
      Estimated Incremental Rate of Return(1)                                                         3.44%
                                                                                      ----------------------
      Estimated Additional Income                                                               $   123,360
      Less:  ESOP Expense                                                                           (18,600)
                  RP Expense                                                                        (22,320)
                                                                                      ----------------------
                                                                                                $    82,440
                                                                                      ----------------------

</TABLE> 
3.    Pro Forma Calculations

<TABLE> 
<CAPTION> 
                                                 Before              Conversion               After
      Period                                   Conversion              Results              Conversion
                                         -------------------------------------------------------------------
<S>                                          <C>                      <C>                   <C> 
a.    Pro Forma Earnings
      Twelve Months Ended
      December 31, 1997                      $   287,000               $   82,440           $   369,440
                                                                                            
b.    Pro Forma Net Worth                                                                   
      December 31, 1997                      $ 2,894,000               $3,585,000           $ 6,479,000
                                                                                            
c.    Pro Forma Net Assets                                                                  
      December 31, 1997                      $36,084,000               $3,585,000           $39,669,000

</TABLE> 

(1) Assumes Proceeds can be reinvested at 5.55 percent and earnings taxed at a
    rate of 38.0 percent.


                                       3
<PAGE>                      
 
FERGUSON & COMPANY
- ------------------

                                   Exhibit VII
                     Pro Forma Effect of Conversion Proceeds
                At the Maximum of the Conversion Valuation Range
                     Valuation Date as of February 27, 1998

<TABLE> 
<CAPTION> 

Northfield Federal Savings
- --------------------------------------------------------------------------------------
<S>                                                                                  <C> 
1.    Conversion Proceeds
      Pro Forma Market Valuation                                                                $ 5,175,000
      Less:  Estimated Expenses                                                                    (387,000)
                                                                                      ----------------------
      Net Conversion Proceeds                                                                   $ 4,788,000

2.    Estimated Additional Income From Conversion Proceeds                                                
      Net Conversion Proceeds                                                                   $ 4,788,000
      Less:  ESOP Contributions                                                                    (414,000)
                  RP Contributions                                                                 (207,000)
                                                                                      ----------------------
      Net Conversion Proceeds after ESOP & RP                                                   $ 4,167,000
      Estimated Incremental Rate of Return(1)                                                         3.44%
                                                                                      ----------------------
      Estimated Additional Income                                                               $   143,386
      Less:  ESOP Expense                                                                           (21,390)
                  RP Expense                                                                        (25,668)
                                                                                      ----------------------
                                                                                                $    96,328
                                                                                      ----------------------
</TABLE> 

3.    Pro Forma Calculations

<TABLE> 
<CAPTION> 
                                                 Before              Conversion               After
      Period                                   Conversion              Results              Conversion
                                          -------------------------------------------------------------------
<S>                                       <C>                    <C>                   <C>   
a.    Pro Forma Earnings
      Twelve Months Ended
      December 31, 1997                   $             287,000  $             96,328  $             383,328

b.    Pro Forma Net Worth
      December 31, 1997                   $           2,894,000  $          4,167,000  $           7,061,000

c.    Pro Forma Net Assets
      December 31, 1997                   $          36,084,000  $          4,167,000  $          40,251,000

</TABLE> 

(1) Assumes Proceeds can be reinvested at 5.55 percent and earnings taxed at a
    rate of 38.0 percent.


                                       4
<PAGE>
 
FERGUSON & COMPANY
- ------------------

                                   Exhibit VII
                     Pro Forma Effect of Conversion Proceeds
                At the SuperMax of the Conversion Valuation Range
                     Valuation Date as of February 27, 1998

<TABLE> 
<CAPTION> 

Northfield Federal Savings
- --------------------------------------------------------------------------------------
<S>                                                                                    <C> 
1.    Conversion Proceeds
      Pro Forma Market Valuation                                                       $          5,951,250
      Less:  Estimated Expenses                                                        $           (402,000)
                                                                                      ----------------------
      Net Conversion Proceeds                                                          $          5,549,250

2.    Estimated Additional Income From Conversion Proceeds
      Net Conversion Proceeds                                                          $          5,549,250
      Less:  ESOP Contributions                                                        $           (476,100)
                  RP Contributions                                                     $           (238,050)
                                                                                      ----------------------
      Net Conversion Proceeds after ESOP & RP                                          $          4,835,100
      Estimated Incremental Rate of Return(1)                                                         3.44%
                                                                                      ----------------------
      Estimated Additional Income                                                      $            166,376
      Less:  ESOP Expense                                                              $            (24,599)
                  RP Expense                                                           $            (29,518)
                                                                                      ----------------------
                                                                                       $            112,259
                                                                                      ----------------------
</TABLE> 

3.    Pro Forma Calculations

<TABLE> 
<CAPTION> 
                                                 Before              Conversion               After
      Period                                   Conversion              Results              Conversion
                                         -------------------------------------------------------------------
<S>                                       <C>                    <C>                    <C>
a.    Pro Forma Earnings
      Twelve Months Ended
      December 31, 1997                   $             287,000  $            112,259   $            399,259

b.    Pro Forma Net Worth
      December 31, 1997                   $           2,894,000  $          4,835,100   $          7,729,100

c.    Pro Forma Net Assets
      December 31, 1997                   $          36,084,000  $          4,835,100   $         40,919,100
</TABLE> 

(1) Assumes Proceeds can be reinvested at 5.55 percent and earnings taxed at a
    rate of 38.0 percent.


                                     

                                       5
<PAGE>
 
FERGUSON & COMPANY
- ------------------

<TABLE> 
<CAPTION> 
                                  Exhibit VII
                            Pro Forma Analysis Sheet

Name of Association:           Northfield Federal Savings
Date of Market Prices:         February 27, 1998                                             Maryland Publicly      All Publicly
                                                                      Comparatives              Held Thrifts        Held Thrifts
                                                                      ------------              ------------        ------------
                                 Symbols      Value              Mean        Median      Mean        Median       Mean       Median
                               -------------------------         ----        ------      ----        ------       ----       ------
<S>                              <C>          <C>              <C>           <C>        <C>          <C>        <C>          <C> 
Price-Earnings Ratio               P/E
     Last Twelve Months                       N/A  
     At Minimum of Range                      10.8 
     At Midpoint of Range                     12.2               24.3          20.8       27.5        29.2         21.3        20.6
     At Maximum of Range                      13.5 
     At Supermax of Range                     14.9 

Price-Book Ratio                   P/B
     At Minimum of Range                      64.9%
     At Midpoint of Range                     69.5%             123.9         119.0      178.3       170.6        173.6       159.7
     At Maximum of Range                      73.3%
     At Supermax of Range                     77.0%

Price-Asset Ratio                  P/A
     At Minimum of Range                       9.8%
     At Midpoint of Range                     11.3%              21.5          20.3       21.5        17.4         19.1        17.8
     At Maximum of Range                      12.9%
     At Supermax of Range                     14.5%

Twelve Mo. Earnings Base            Y                          $    287,000
     Period Ended
     December 31, 1997

Book Value                          B                          $  2,894,000
     As of  December 31, 1997

Total Assets                        A                          $ 36,084,000
     As of  December 31, 1997

Return on Money (1)                 R                                 3.44%

Conversion Expense                  X                          $    375,000
Underwriting Commission             C                                 0.00%
Percentage Underwritten             S                                 0.00%
Estimated Dividend
     Dollar Amount                 DA                          $     90,000
     Yield                         DY                                 2.00%
ESOP Contributions                  P                          $    360,000
RP Contributions                    I                          $    180,000
ESOP Annual Expense                 E                          $     18,600
RP Annual Contributions             M                          $     22,320
Cost of ESOP Borrowings             F                                 0.00%
</TABLE> 

(1) Assumes Proceeds can be reinvested at 5.55 percent and earnings taxed at a
    rate of 38.0 percent.


                                       6
<PAGE>
 
FERGUSON & COMPANY
- ------------------

                                  Exhibit VII
                            Pro Forma Analysis Sheet


Calculation of Estimated Value (V) at Midpoint Value

<TABLE> 
<S>             <C>            <C>                                   <C>                    <C> 
1.              V=                   P/A(A-X-P-I)                    $ 4,500,000
                               -------------------------
                                    1-P/A(1-(CxS))

2.              V=                   P/B(B-X-P-I)                    $ 4,500,000
                               -------------------------
                                    1-P/B(1-(CxX))

3.              V=             P/E(Y-R(X+P+I)-(E+M))                 $ 4,500,000
                               ---------------------------------
                                   1-P/E(R(1-(CxX))

                                           Value                           
        Estimated Value                   Per Share                  Total Shares                   Date
      -------------------               -------------             -----------------         --------------------
          $4,500,000                        $10.00                       450,000              February 27, 1998
</TABLE> 

Range of Value
$4.5 million x 1.15 = $5.175 million or 517,500 shares at $10.00 per share $4.5
million x 0.85 = $3.825 million or 382,500 shares at $10.00 per share



                                       7
<PAGE>
 
                                 EXHIBIT VIII
<PAGE>
 
FERGUSON & COMPANY      Exhibit VIII - Reconciliation of Quarterly
- ------------------          Reports to Financial Statements


<TABLE> 
<CAPTION> 
                                                                                          Net
                                                                                        Income
                                                                                         Year
                                                                        Equity           Ended
                                                                          at          ------------
                                                                        12-31-97        12-31-97
                                                                        --------      ------------
                                                                               ($000's)
<S>                                                                    <C>              <C> 
Amounts in quarterly reports                                                2,922             153

Adjustments:
  Income taxes                                                                (20)            (20)
  Accrued and prepaid expenses                                                 (8)             (8)
  1996 audit adjustments recorded in 1997                                                      20
                                                                      ------------    ------------
Net adjustments                                                               (28)             (8)
                                                                      ------------    ------------

Equity per financial statements                                             2,894
                                                                      ============

Net income per
  financial statements                                                                        145
                                                                                      ============
</TABLE> 

Source: Quarterly reports and financial statements

                                       1


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