10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

[X]	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2006
[   ]	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____________ to ___________ Commission file number 000-1330039 AMERICAN BANCORP OF NEW JERSEY, INC. (Exact name of registrant as specified in its charter)

New Jersey(State or other jurisdiction of incorporation or organization)	55-0897507(I.R.S. Employer Identification Number)
365 Broad Street, Bloomfield, New Jersey 07003(Address of Principal Executive Offices) (973) 748-3600(Registrant's telephone number, including area code)

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

Yes [ X ]       No [    ]

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

Large accelerated filer [    ] Accelerated filer [    ] Non-accelerated filer [ X ]

As of May 10, 2006, there were 14,169,469 outstanding shares of the Registrant's Common Stock.

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AMERICAN BANCORP OF NEW JERSEY, INC.

Table of Contents

PART I - FINANCIAL INFORMATION (UNAUDITED)
Item 1.	Financial Statements	3
	Notes to Unaudited Financial Statements	9
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	34
Item 4.	Controls and Procedures	38
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	39
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	39
Item 3.	Defaults Upon Senior Securities	39
Item 4.	Submission of Matters to a Vote of Securities Holders	39
Item 5.	Other Information	39
Item 6.	Exhibits	39
FORM 10-Q SIGNATURE PAGE		40
CERTIFICATIONS

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ITEM 1. FINANCIAL STATEMENTS

American Bancorp of New Jersey, Inc.
Statements of Financial Condition
(in thousands, except share data)
(unaudited)

				March 31, 2006	September 30, 2005
ASSETS
Cash and cash equivalents
	Cash and due from banks			$    1,960	$    2,622
	Interest-bearing deposits			16,945	105,851
	Federal funds sold			-	17,300
		Total cash and cash equivalents		18,905	125,773
Securities available-for-sale				92,873	62,337
Securities held-to-maturity (fair value: March 31, 2006 -   $11,661; September 30, 2005 - $7,694)				11,887	7,824
Loans, net				371,979	341,006
Loans held for sale				419	280
Premises and equipment				4,266	4,131
Federal Home Loan Bank stock, at cost				3,121	3,119
Cash surrender value of life insurance				8,587	7,512
Accrued interest receivable				1,869	1,468
Other assets				2,372	2,410
	Total assets			$ 516,278	$ 555,860
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
	Deposits
		Noninterest-bearing		$   27,001	$   25,583
		Interest-bearing		302,189	315,342
			Total deposits	329,190	340,925
	Stock subscriptions received			-	115,201
	Advance payments by borrowers for taxes and insurance			2,580	2,443
	Federal Home Loan Bank borrowings			52,405	53,734
	Accrued interest payable and other liabilities			3,473	3,578
	Common stock in ESOP subject to contingent repurchase obligation			-	473
		Total liabilities		387,648	516,354
Stockholders' Equity
	September 30, 2005 - preferred stock, $.10 par value, 5,000,000   shares authorized March 31, 2006 - preferred stock,   $.10 par value, 10,000,000 shares authorized			-	-
	September 30, 2005 - Common stock, $.10 par value,   20,000,000 shares authorized; 5,554,500 shares issued and outstanding
	March 31, 2006 - Common stock, $.10 par value,   20,000,000 shares authorized; 14,169,469 shares issued and outstanding			1,417	555
	Additional paid-in capital			111,492	17,242
	Unearned ESOP shares			(8,774)	(1,064)
	Unearned RSP shares			-	(1,212)
	Retained earnings			25,720	25,417
	Accumulated other comprehensive loss			(1,225)	(959)
	Amount reclassified on ESOP shares			-	(473)
		Total stockholders' equity		128,630	39,506
			Total liabilities and stockholders' equity	$ 516,278	$ 555,860

See accompanying notes to unaudited consolidated financial statements

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American Bancorp of New Jersey, Inc.
Statements of Income
(in thousands, except share data)
(unaudited)

			Six Months Ended March 31,		Three Months Ended March 31,
			2006	2005	2006	2005
Interest and dividend income
	Loan, including fees		$   9,538	$   8,483	$   4,847	$   4,345
	Securities		1,909	1,450	1,132	711
	Federal funds sold and other		872	61	260	33
		Total interest income	12,319	9,994	6,239	5,089
Interest expense
	NOW and money market		400	206	206	108
	Savings		1,055	1,108	551	532
	Certificates of deposit		2,728	1,705	1,381	896
	Federal Home Loan Bank advances		1,291	1,404	635	707
		Total interest expense	5,474	4,423	2,773	2,243
Net interest income			6,845	5,571	3,466	2,846
Provision for loan losses			246	112	159	70
Net interest income after provision for loan losses			6,599	5,459	3,307	2,776
Noninterest income
	Deposit service fees and charges		366	320	183	146
	Income from cash surrender value of life insurance		155	133	80	73
	Gain on sale of loans		8	1	6	-
	Loss on sales of securities available-for-sale		(271)	-	-	-
	Other		140	83	103	71
		Total noninterest income	398	537	372	290
Noninterest expense
	Salaries and employee benefits		3,087	2,545	1,689	1,335
	Occupancy and equipment		405	409	206	204
	Data processing		315	293	157	148
	Advertising		125	140	73	76
	Professional and consulting		255	166	137	99
	Legal		108	156	23	81
	Other		514	402	279	211
		Total noninterest expense	4,809	4,111	2,564	2,154
Income before provision for income taxes			2,188	1,885	1,115	912
Provision for income taxes			837	691	427	328
Net income			$   1,351	$   1,194	$     688	$     584
Comprehensive income			$   1,085	$     726	$     309	$     114
Earnings per share:
	Basic		$    0.10	$    0.09	$    0.05	$    0.04
	Diluted		$    0.10	$    0.09	$    0.05	$    0.04

See accompanying notes to unaudited consolidated financial statements

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American Bancorp of New Jersey, Inc.
Statements of Stockholders' Equity
Six months ended March 31, 2005
(in thousands)
(unaudited)

	Common Stock	Additional Paid-in Capital	Unearned ESOP Shares	Unearned RSP Shares	Retained Earnings	Accumulated Other Comprehensive Loss	Amount Reclassified On ESOP Shares	Total Equity	Comprehensive Income (Loss)
Balance at September 30, 2004	$ 555	$ 15,687	$ (1,200)	$           -	$ 24,806	$ (482)	$ (52)	$ 39,314
RSP stock grants	-	1,332	-	(1,332)	-	-	-	-
RSP shares earned	-	-	-	67	-	-	-	67
ESOP shares earned	-	47	69	-	-	-	-	116
ESOP dividend proceeds	-	-	-	-	-	-	-	-
Cash dividends paid - $0.75 per share	-	-	-	-	(1,152)	-	-	(1,152)
Reclassification due to change in fair value   of common stock in ESOP subject to   contingent repurchase obligation	-	-	-	-	-	-	(260)	(260)
Comprehensive income
Net income	-	-	-	-	1,194	-	-	1,194
Change in unrealized gain on securities        available-for-sale, net of taxes	-	-	-	-	-	(468)	-	(468)
Total comprehensive income									$        726
Balance at March 31, 2005	$ 555	$ 17,066	$ (1,131)	$ (1,265)	$ 24,848	$ (950)	$ (312)	$ 38,811

See accompanying notes to unaudited consolidated financial statements

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American Bancorp of New Jersey, Inc.
Statements of Stockholders' Equity
Six months ended March 31, 2006
(in thousands)
(unaudited)

	Common Stock	Additional Paid-in Capital	Unearned ESOP Shares	Unearned RSP Shares	Retained Earnings	Accumulated Other Comprehensive Loss	Amount Reclassified On ESOP Shares	Total Equity	Comprehensive Income (Loss)
Balance at September 30, 2005	$   555	$ 17,242	$ (1,064)	$ (1,212)	$ 25,417	$   (959)	$ (473)	$  39,506
Transfer of Unearned RSP to   APIC due to adoption of   FAS 123R	-	(1,212)	-	1,212	-	-	-	-
Issuance and exchange of   common stock, net of   issuance costs	862	96,661	(7,935)	-	-	-	-	89,588
MHC capital infusion from   merger	-	98	-	-	-	-	-	98
RSP share purchases	-	(1,601)	-	-	-	-	-	(1,601)
RSP shares earned	-	131	-	-	-	-	-	131
Stock options earned		126	-	-	-	-	-	126
ESOP shares earned	-	47	225	-	-	-	-	272
Cash dividends paid -   $0.04 per share	-	-	-	-	(1,048)	-	-	(1,048)
Reclassification due to   elimination of   repurchase obligation	-	-	-	-	-	-	473	473
Comprehensive income
Net income	-	-	-	-	1,351	-	-	1,351
Change in unrealized        gain on securities        available-for-sale, net        of taxes	-	-	-	-	-	(266)	-	(266)
Total comprehensive             income									$ 1,085
Balance at March 31, 2006	$ 1,417	$ 111,492	$ (8,774)	$ -	$ 25,720	$ (1,225)	$         -	$ 128,630

See accompanying notes to unaudited consolidated financial statements

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American Bancorp of New Jersey, Inc.
Statements of Cash Flows
(in thousands)
(unaudited)

				Six Months Ended March 31,
				2006	2005
Cash flows from operating activities
	Net income			$   1,351	$   1,194
	Adjustments to reconcile net income to net cash   provided by operating activities
		Depreciation and amortization		170	180
		Net amortization of premiums and discounts		(28)	66
		Losses on sales of securities available-for-sale		271	-
		ESOP compensation expense		272	116
		RSP compensation expense		131	67
		SOP compensation expense		126	-
		Provision for loan losses		246	112
		Increase in cash surrender value of life insurance		(155)	(133)
		Gain on sale of loans		(8)	(1)
		Proceeds from sales of loans		2,999	144
		Origination of loans held for sale		(3,130)	(444)
		Decrease (increase) in accrued interest receivable		(401)	(112)
		Decrease (increase) in other assets		255	(104)
		Change in deferred income taxes		(62)	(20)
		Increase (decrease) in other liabilities		(105)	(15)
			Net cash from operating activities	1,932	1,050
Cash flows from investing activities
	Net increase in loans receivable			(31,219)	(24,395)
	Purchases of securities held-to-maturity			(4,935)	(6,227)
	Principal paydowns on securities held-to-maturity			862	490
	Purchases of securities available-for-sale			(52,606)	-
	Sales of securities available-for-sale			9,750	-
	Calls of securities available-for-sale			-	2,000
	Maturities of securities available-for-sale			2,000	-
	Principal paydowns on securities available-for-sale			9,666	10,725
	Purchase of Federal Home Loan Bank stock			(93)	(1,828)
	Redemption of Federal Home Loan Bank stock			91	1,205
	Purchase of bank-owned life insurance			(920)	(1,000)
	Purchase of premises and equipment			(305)	(329)
		Net cash from investing activities		(67,709)	(19,359)
Cash from financing activities
	Net increase (decrease) in deposits			(11,735)	5,327
	Net change in advance payments by borrowers for taxes and insurance			137	169
	Repayment of Federal Home Loan Bank of New York advances			(2,029)	(1,028)
	Net change in Federal Home Loan Bank of New York OLOC			700	11,800
	Net proceeds from stock issuance			89,588	-
	MHC capital infusion			98	-
	RSP share purchases			(1,601)	-
	Cash dividends paid			(1,048)	(1,152)
	Stock subscriptions refunded or applied			(115,201)	-
		Net cash from financing activities		(41,091)	15,116
Net change in cash and cash equivalents				(106,868)	(3,193)
Cash and cash equivalents at beginning of period				125,773	8,034
Cash and cash equivalents at end of period				$   18,905	$   4,841

(Continued)

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American Bancorp of New Jersey, Inc.
Statements of Cash Flows
(in thousands)
(unaudited)

			Six Months Ended March 31,
			2006	2005
Supplemental cash flow information:
	Cash paid during the period for
		Interest	$   5,475	$   4,422
		Income taxes, net of refunds	981	910
Supplemental disclosures of non-cash financing transaction:
		Transfer of stock subscriptions received and deposits to capital	89,588	-

See accompanying notes to unaudited consolidated financial statements

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American Bancorp of New Jersey, Inc.
Notes To Unaudited Financial Statements
(tables in thousands)

Note 1 - Basis of Presentation

             American Bancorp of New Jersey, Inc. (the "Company") is a New Jersey chartered corporation organized in May 2005 that was formed for the purpose of acquiring all of the capital stock of American Bank of New Jersey (the "Bank"), which was previously owned by ASB Holding Company ("ASBH"). ASBH was a federally chartered corporation organized in June 2003 that was formed for the purpose of acquiring all of the capital stock of American Bank of New Jersey, which was previously owned by American Savings, MHC (the "MHC"), a federally chartered mutual holding company. The Bank had previously converted from a mutual to a stock savings bank in a mutual holding company reorganization in 1999 in which no stock was sold to any person other than the MHC.

             On October 3, 2003, ASBH completed a minority stock offering and sold 1,666,350 shares of common stock in a subscription offering at $10 per share and received proceeds of $16,060,000 net of offering costs of $603,000. See Note 2 Minority Offering for further discussion.

             After the sale of the stock in the minority offering, the MHC held 70%, or 3,888,150 shares, of the outstanding stock of ASBH, with the remaining 30% or, 1,666,350 shares held by persons other than the MHC. ASBH held 100% of the Bank's outstanding common stock.

             On October 5, 2005, the Company completed a second step conversion at which time ASB Holding Company ceased to exist and American Bancorp of New Jersey, Inc. became the new holding company for the Bank. The Company currently holds 100% of the outstanding stock of American Bank of New Jersey. See Note 3 Second Step Conversion for further discussion.

             The accompanying unaudited consolidated financial statements include the accounts of American Bancorp of New Jersey, Inc. and its wholly owned subsidiaries, American Bank of New Jersey and ASB Investment Corp. (the "Investment Corp.") as of March 31, 2006 and for the three and six months ended March 31, 2006. The consolidated financial statements as of September 30, 2005 and the three and six months ended March 31, 2005 are those of ASB Holding Company, the Company's predecessor. Significant intercompany accounts and transactions have been eliminated in consolidation. References in this Quarterly Report on Form 10-Q to the Company generally refer to the Company and the Bank, unless the context indicates otherwise. References to "we," "us," or "our" refer to the Bank or Company, or both, as the context indicates.

             The primary business of the Company is the ownership of the Bank and the Investment Corp. The Bank provides a full range of banking services to individual and corporate customers in New Jersey. The Bank is subject to competition from other financial institutions and to the regulations of certain federal and state agencies and undergoes periodic examinations by those regulatory authorities. The Investment Corp. was organized for the purpose of selling insurance and investment products, including annuities, to customers of the Bank and the general public, with initial activities limited to the sale of fixed rate annuities. The Investment Corp. has had limited activity to date.

             The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and notes required by accounting principles generally accepted in the United States of America for complete financial statements. These interim statements should be read in conjunction with the consolidated financial statements and notes included in the Annual Report on Form 10-K. The September 30, 2005 balance sheet presented herein has been derived from the audited financial statements included in the consolidated financial statements and notes included in the Annual Report on Form 10-K filed with the Securities and Exchange Commission, but does not include all disclosures required by accounting principles generally accepted in the United States of America.

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             To prepare financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the financial statements and the disclosures provided, and future results could differ. The allowance for loan losses, prepayment speeds on mortgage -backed securities, and status of contingencies are particularly subject to change.

             Interim statements are subject to possible adjustment in connection with the annual audit of the Company for the year ended September 30, 2006. In the opinion of management of the Company, the accompanying unaudited interim consolidated financial statements reflect all of the adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the consolidated financial position and consolidated results of operations for the periods presented.

             The results of operations for the six months ended March 31, 2006 are not necessarily indicative of the results to be expected for the full year or any other period.

Note 2 - Minority Offering

             On October 3, 2003, ASB Holding Company, the predecessor of American Bancorp of New Jersey, Inc., completed a minority stock offering and sold 1,666,350 shares of common stock in a subscription offering at $10 per share and received proceeds of $16,060,000 net of offering costs of $603,000. ASBH contributed $9,616,000 or approximately 60% of the net proceeds to the Bank in the form of a capital contribution. ASBH loaned $1,333,080 to the Bank's employee stock ownership plan and the ESOP used those funds to acquire 133,308 shares of common stock at $10 per share.

             After the sale of the stock, the MHC held 70%, or 3,888,150 shares, of the outstanding stock of ASBH with the remaining 30% or, 1,666,350 shares, held by persons other than the MHC. ASBH held 100% of the Bank's outstanding common stock.

Note 3 - Second Step Conversion

             On October 5, 2005, the Company completed a second step conversion in which the 3,888,150 shares of ASB Holding Company held by American Savings, MHC were converted and sold in a subscription offering. Through this transaction, ASB Holding Company ceased to exist and was supplanted by American Bancorp of New Jersey as the holding company for the Bank. A total of 9,918,750 shares of common stock were sold in the offering at $10 per share through which the Company received proceeds of $97,524,302 net of offering costs of $1,663,198. The Company contributed $48,762,151 or approximately 50% of the net proceeds to the Bank in the form of a capital contribution. The Company loaned $7,935,000 to the Bank's employee stock ownership plan and the ESOP used those funds to acquire 793,500 shares of common stock at $10 per share.

             As part of the conversion, the 1,666,350 outstanding shares of ASB Holding Company were each exchanged for 2.55102 of the Company's shares. This exchange resulted in an additional 4,250,719 shares of American Bancorp of New Jersey, Inc. being issued for a total of 14,169,469 outstanding shares.

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             The Company had stock subscriptions received totaling $115,201,806 at September 30, 2005 pending completion of the conversion and stock offering. At the time of closing on October 5, 2005, approximately $91,252,500, less offering expenses, became capital of the Company with the remainder being returned on oversubscriptions. The following table summarizes the pro forma impact of the conversion and stock offering results on the Company's September 30, 2005 balance sheet.

Actual and Pro Forma Summary Consolidated Statement of Financial Condition
September 30, 2005

	Actual	Pro Forma
ASSETS
Cash and cash equivalents(1)	$ 125,773	$  92,166
Securities available-for-sale	62,337	62,337
Securities held-to-maturity	7,824	7,824
Loans held for sale	280	280
Loans receivable, net of allowance for loan losses	341,006	341,006
Premises and equipment	4,131	4,131
Federal Home Loan Bank stock, at cost	3,119	3,119
Cash surrender value of life insurance	7,512	7,512
Accrued interest receivable	1,468	1,468
Other assets	2,410	1,797
Total assets	$ 555,860	$ 521,640
LIABILITIES AND EQUITY
Deposits(2)	340,925	331,167
Stock subscriptions received(3)	115,201	-
Advance payments by borrowers for taxes and insurance	2,443	2,443
Federal Home Loan Bank advances	53,734	53,734
Accrued expenses and other liabilities	3,578	4,629
Common stock in ESOP subject to contingent repurchase obligation(6)	473	-
Total liabilities	516,354	391,973
Equity
Common stock and additional paid in capital(4)	17,797	115,420
Unearned ESOP shares(5)	(1,064)	(8,999)
Unearned RSP shares	(1,212)	(1,212)
Retained earnings	25,417	25,417
Accumulated other comprehensive loss	(959)	(959)
Amount reclassified on ESOP shares(6)	(473)	-
Total equity	39,506	129,667
Total liabilities and equity	$ 555,860	$ 521,640

(1)	Pro forma balance reflects reduction of cash for funding the return of approximately $33.7 million in oversubscriptions.
(2)	Pro forma balance reflects approximately $9.8 million of deposit balances withdrawn to purchase shares in the stock offering.
(3)	Pro forma balance reflects refund of $33.7 million of oversubscriptions plus the utilization of $81.5 million of subscriptions to purchase shares in the stock offering.
(4)	Pro forma balance reflects additional capital from deposits, subscriptions and ESOP purchases of $9.8 million, $81.5 million and $7.9 million, respectively. An additional $99,000 of capital was received through the merger of American Savings, MHC into the Bank. These additions to capital were offset by stock offering expenses of approximately $1.6 million.
(5)	Pro forma balance reflects the addition of $7.9 million of unearned shares purchased by the ESOP during the stock offering.
(6)	Pro forma balance reflects the elimination of ESOP contingent repurchase obligation of $473,000.

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Note 4 - Earnings Per Share (EPS)

             Amounts reported as basic earnings per share of common stock reflect earnings available to common stockholders for the period divided by the weighted average number of common shares outstanding during the period less unearned ESOP shares. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock (such as stock awards and options) were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. Diluted EPS is computed by dividing income by the weighted-average number of shares outstanding for the period plus common-equivalent shares computed using the treasury stock method.

             The factors used in the earnings per share computation follow.

	Six Months Ended March 31,		Three Months Ended March 31,
	2006	2005	2006	2005
Basic
Net income	$ 1,351	$ 1,194	$  688	$  584
Weighted average common shares outstanding	13,141,302	13,874,766	13,126,422	13,881,805
Basic earnings per common share	$   0.10	$   0.09	$ 0.05	$ 0.04
Diluted
Net income	$ 1,351	$ 1,194	$  688	$  584
Weighted average common shares outstanding for basic earnings per common share	13,141,302	13,874,766	13,126,422	13,881,805
Add: Dilutive effects of assumed exercises of stock options	86,411	-	66,732	206
Add: Dilutive effects of full vesting of stock awards	33,855	-	33,045	52
Average shares and dilutive potential common shares	13,261,567	13,874,766	13,226,199	13,882,063
Diluted earnings per common share	$   0.10	$   0.09	$ 0.05	$ 0.04

Note 5 - Employee Stock Ownership Plan

             As part of the minority stock offering, the Bank established an ESOP for the benefit of substantially all employees. The ESOP borrowed $1,333,080 from ASBH and used those funds to acquire 133,308 shares of ASBH stock at $10 per share. As part of the second step conversion, the ESOP borrowed $7,935,000 from the Company to acquire an additional 793,500 shares of the Company's stock at $10 per share. At the time of the closing of the second step conversion, the unpaid balance of the first ESOP borrowing of approximately $1,064,000 was combined with the balance of the second ESOP borrowing resulting in a total ESOP borrowing obligation of approximately $8,999,000 to the Company. Additionally, each of the 133,308 ASBH shares held by the ESOP from the minority offering were exchanged for 2.55102 shares of the Company.

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             Shares issued to the ESOP are allocated to ESOP participants based on principal and interest repayments made by the ESOP on the loan from the Company. The loan is secured by shares purchased with the loan proceeds and will be repaid by the ESOP with funds from the Bank's discretionary contributions to the ESOP and earnings on the ESOP's assets. Principal and interest payments are scheduled to occur over a twenty-year period.

             At March 31, 2006, the ESOP held 1,133,571 shares of the Company's common stock and 81,933 of these shares had been allocated to the accounts maintained for participants. Participants become eligible to receive payment of the vested benefits under the plan upon retirement, disability or termination of employment. Participants who elect to receive their benefit payments in the form of American Bancorp of New Jersey, Inc. common stock may require the Company to purchase the common stock distributed at fair value during two 60-day periods. The first purchase period begins on the date the benefit is paid and the second purchase period begins on the first anniversary of the payment date. At September 30, 2005, this contingent repurchase obligation was reflected in the Company's financial statements as "Common stock in ESOP subject to contingent repurchase obligation" and reduces stockholder's equity by an amount that represents the fair value of all the shares of Company common stock held by the ESOP, without regard to whether it is likely that the shares would be distributed or that the recipients of the shares would be likely to exercise their right to require the Company to purchase the shares. At September 30, 2005, this contingent repurchase obligation reduced stockholders' equity by $473,000. On October 5, 2005, the Company completed its second step offering (as discussed in Note 3 to the consolidated financial statements). On October 6, 2005, the Company began trading on Nasdaq which is considered to be an established market under ERISA regulations. As a result, effective October 6, 2005, the Company is no longer required to establish a liability to reflect this repurchase obligation. Consequently, at March 31, 2006, this contingent repurchase obligation was no longer recorded as a reduction of stockholder's equity.

Note 6 - Other Stock-Based Compensation

             At the annual meeting held on January 20, 2005, stockholders of ASBH approved the ASB Holding Company 2005 Stock Option Plan ("SOP") and the American Bank of New Jersey 2005 Restricted Stock Plan ("RSP"). 272,171 shares of common stock were made available under the 2005 Stock Option Plan. On January 20, 2005, options to purchase 259,923 shares were awarded with the remaining 12,248 shares awarded on May 6, 2005. In addition, 81,651 shares of common stock were made available under the 2005 Restricted Stock Plan. On January 20, 2005, 76,752 shares of restricted stock were awarded with the remaining 4,899 shares awarded on May 6, 2005.

             As of the closing of the Company's second step conversion on October 5, 2005, each of the ASBH shares included in the 2005 Restricted Stock Plan and 2005 Stock Option Plan were exchanged for 2.55102 shares of American Bancorp of New Jersey, Inc. Consequently, awarded shares under the 2005 Restricted Stock Plan and 2005 Stock Option Plan totaled 208,295 and 694,315, respectively, at that time.

             Shares of common stock issuable pursuant to outstanding options under the 2005 Stock Option Plan are considered outstanding for purposes of calculating earnings per share on a diluted basis. The Financial Accounting Standards Board has announced a change in the required accounting methods applicable to stock options that became effective during the first quarter of fiscal 2006. Under such accounting requirements, the Company is now required to recognize compensation expense related to stock options outstanding based upon the fair value of such awards at the date of grant over the period that such awards are earned. For the six months ended March 31, 2006, the Company recognized approximately $126,000 of compensation expense relating to the 2005 Stock Option Plan. The Company recognized approximately $19,000 of income tax benefit resulting from this expense for that period.

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             For accounting purposes, the Company continues to recognize compensation expense for shares of common stock awarded under the 2005 Restricted Stock Plan over the vesting period at the fair market value of the shares on the date they are awarded. For the six months ended March 31, 2006, the Company recognized approximately $156,000 of compensation expense relating to the 2005 Restricted Stock Plan. The Company recognized approximately $62,000 of income tax benefit resulting from this expense for that period.

             During the six months ended March 31, 2006, 6,249 RSP shares and 19,094 SOP options that had been previously awarded were forfeited by a participant due to the participant's discontinued employment by the Bank. The Company reversed approximately $6,400 of accrued RSP compensation expense in the six months ended March 31, 2006 resulting from that forfeiture. The Company may consider awarding such shares and options at a later date.

             As of March 31, 2006, there were approximately $949,000 and $1,038,000, respectively of total unrecognized compensation costs related to nonvested stock options and nonvested restricted stock plan shares. Those costs are expected to be recognized over a weighted-average period of 3.8 years.

For the fiscal year ended September 30, 2005, employee compensation expense for stock options granted in January and May of 2005 were reported using the intrinsic value method. No stock-based compensation cost was reflected in net income, as all options granted had an exercise price equal to or greater than the market price of the underlying common stock at date of grant. The table below illustrates the effect on net income and basic and diluted earnings per share if expense was measured using the fair value recognition provisions of FASB Statement No. 123, Accounting for Stock-Based Compensation for the comparative three and six month periods ended March 31, 2005.

	Six Months Ended March 31, 2005	Three Months Ended March 31, 2005
Basic
Net Income	$        1,194	$            584
Pro forma net income	1,146	536
Weighted average common shares outstanding	13,874,766	13,881,805
Basic earnings per common share	$           0.09	$           0.04
Pro forma basic earnings per common share	$           0.08	$           0.04
Diluted
Diluted earnings per common share	$           0.09	$           0.04
Pro forma diluted earnings per common share	$           0.08	$           0.04

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             The fair value of options granted and actual effects are computed using the Black-Scholes option pricing model, using the following weighted-average assumptions as of the grant dates.

	January 20, 2005	May 6, 2005
Options Awarded
Risk free interest rate	3.67%	3.95%
Expected option life	5.00	5.00
Expected stock price volatility	22.00%	22.00%
Dividend yield	0.00%	0.00%
Weighted average fair value of options     granted during year	$ 4.75	$ 5.00

A summary of the activity in the Company's stock option plan for the six months ended March 31, 2006 is as follows.

	Shares	Weighted Average Exercise Price
Outstanding at beginning of period	694,315	$ 6.81
Granted	-	-
Exercised	-	-
Forfeited or expired	(19,094)	$ 6.80
Outstanding at end of period	675,221	$ 6.81
Options exercisable at period end	128,790	$ 6.80
Weighted average remaining contractual life		8.8 years

The aggregate intrinsic value of stock options outstanding and exercisable at March 31, 2006 was $530,615.

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A summary of the status of the Company's nonvested restricted stock plan shares as of March 31, 2006 and changes during the six months ended March 31, 2006 are as follows.

	Shares	Weighted Average Grant-Date Fair Value
Nonvested at beginning of period	208,295	$ 6.81
Granted	-	-
Vested	(37,908)	$ 6.80
Forfeited or expired	(6,249)	$ 6.80
Nonvested at end of period	164,138	$ 6.81

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

Forward-Looking Statements

             This report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 as amended and is including this statement for purposes of these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe future plans, strategies, and expectations of the Company, are generally identifiable by use of the words "believe," "expect," "intend," "anticipate," "estimate," "project," or similar expressions. The Company's ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors that could have a material adverse affect on the operations and future prospects of the Company and its wholly-owned subsidiaries include, but are not limited to, changes in: interest rates; general economic conditions; legislative/regulatory provisions; monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board; the quality or composition of the loan or investment portfolios; demand for loan products; deposit flows; competition; and demand for financial services in the Company's market area. These risks and uncertainties should be considered in evaluating forward-looking statements, and undue reliance should not be placed on such statements.

Critical Accounting Policies

              Various elements of our accounting policies, by their nature, are inherently subject to estimation techniques, valuation assumptions and other subjective assessments. The following is a description of our critical accounting policy and an explanation of the methods and assumptions underlying its application.

              Allowance for Loan Losses. Our policy with respect to the methodologies used to determine the allowance for loan losses is our most critical accounting policy. This policy is important to the presentation of our financial condition and results of operations, and it involves a higher degree of complexity and requires management to make difficult and subjective judgments, which often require assumptions or estimates about highly uncertain matters. The use of different judgments, assumptions, and estimates could result in material differences in our results of operations or financial condition.

              In evaluating the level of the allowance for loan losses, management considers the Company's historical loss experience as well as various "environmental factors" including the types of loans and the amount of loans in the loan portfolio, adverse situations that may affect the borrower's ability to repay, estimated value of any underlying collateral, peer group information, and prevailing economic conditions. Large groups of smaller balance homogeneous loans, such as residential real estate, small commercial real estate, and home equity and consumer loans, are evaluated in the aggregate using historical loss factors and peer group data adjusted for current economic conditions. Large balance and/or more complex loans, such as multi-family, commercial real estate and construction loans, are evaluated individually for impairment. This evaluation is inherently subjective, as it requires estimates that are susceptible to significant revision, as more information becomes available or as projected events change.

              Management assesses the allowance for loan losses quarterly. While management uses available information to recognize losses on loans, future loan loss provisions may be necessary based on changes

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in economic conditions. In addition, regulatory agencies, as an integral part of their examination process, periodically review the allowance for loan losses and may require the Bank to recognize additional provisions based on their judgment of information available to them at the time of their examination. The allowance for loan losses as of March 31, 2006 was maintained at a level that represented management's best estimate of losses in the loan portfolio to the extent they were both probable and reasonable to estimate.

              Application of the Bank's loan loss methodology outlined above results, in part, in historical and environmental loss factors being applied to the outstanding balance of homogeneous groups of loans to estimate probable credit losses. For example, as a result of continued loan growth, a part of the Bank's loan portfolio is considered "unseasoned," meaning the loans were originated less than three years ago. Generally, unseasoned loans demonstrate a greater risk of credit losses than their seasoned counterparts. Moreover, in many cases, these unseasoned loans are obligations of borrowers with whom the Bank has had no prior payment experience. These risks are considered in the environmental factors used in the Bank's loss provision calculations as described above. Both historical and environmental loss factors are reviewed and updated quarterly, where appropriate, as part of management's assessment of the allowance for loan losses.

              During the prior fiscal year, changes to environmental factors used in the Bank's loss provision calculations generally reflected the Company's increased strategic focus on commercial real estate and construction lending. Environmental factors applied to the outstanding balance of construction and commercial mortgages reflected increased balances of unseasoned loans and concerns about potential changes in real estate values. However, the impact of these increases were partially offset by reductions in environmental factors attributable to the experience, ability, and depth of lending management and staff both of which were enhanced during the prior fiscal year. No significant changes to environmental factors used in the Bank's loss provision calculations have been made during the first six months of fiscal 2006.

              Management generally expects provisions for loan losses to increase as a result of the net growth in loans called for in the Company's business plan. Specifically, our business strategy calls for increased strategic emphasis in commercial real estate, construction and business lending. The loss factors used in the Bank's loan loss calculations are generally higher for such loans compared with those applied to one-to-four family mortgage loans. Consequently, future net growth in commercial real estate, construction and business loans may result in required loss provisions that exceed those recorded in prior years when comparatively greater strategic emphasis had been placed on growing the 1-4 family mortgage loan portfolio.

Executive Summary

              The Company's results of operations depend primarily on its net interest income. Net interest income is the difference between the interest income we earn on our interest-earning assets and the interest we pay on our interest-bearing liabilities. It is a function of the average balances of loans and investments versus deposits and borrowed funds outstanding in any one period and the yields earned on those loans and investments and the cost of those deposits and borrowed funds. Our interest-earning assets consist primarily of residential mortgage loans, multi-family and commercial real estate mortgage loans, residential mortgage-related securities, and U.S. Agency debentures. Interest-bearing liabilities consist primarily of retail deposits and borrowings from the Federal Home Loan Bank of New York.

              During the Company's fiscal year ended September 30, 2004, the general level of market interest rates began to increase from the historical lows of the prior periods. Such increases slowed the pace of loan refinancing, thereby reducing the rate at which the Company's earning assets prepaid. Slowing prepayments resulted in a corresponding reduction in the amortization of deferred costs and premiums

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thereby increasing the Company's earning asset yields. The Company's cost of interest-bearing liabilities lagged the upward movement in current market interest rates. After decreasing for thirteen consecutive quarters, the Company's cost of interest-bearing liabilities remained unchanged for the quarters ended March 31, 2004 and June 30, 2004 before increasing modestly in the final quarter of the fiscal year ended September 30, 2004. As a result, the Company reported a 16 basis point improvement in its net interest margin to 2.60% for the year ended September 30, 2004 from 2.44% for the year ended September 30, 2003.

              Through the first half of fiscal 2005, the Company continued to realize improvements in its net interest margin as increases in earning asset yields continued to outpace those of its interest bearing-liabilities. However, that trend reversed in the latter half of 2005 when upward pressure on the Company's cost of deposits resulted in an increase in the Company's cost of interest-bearing liabilities greater than the increase in the yield of its interest-earning assets. For the year ended September 30, 2005, the Company experienced a 16 basis point increase in its yield on earning assets to 4.84% from 4.68% for year ended September 30, 2004. This increase was attributable to a 22 basis point increase in the yield on investment securities and a 207 basis point increase in the yield on interest-bearing deposits and other earning assets. These increases were partially offset by a 7 basis point decline in the yield on loans. Offsetting this overall improvement in earning asset yields was a 15 basis point increase in the cost of interest-bearing liabilities to 2.56% from 2.41%. This increase resulted, in part, from a 26 basis point increase in the cost of interest-bearing deposits. This increase was partially offset by an 18 basis point decrease in the cost of borrowings resulting primarily from increased utilization of overnight borrowings. In total, the Company's net interest margin remained unchanged at 2.60% for fiscal 2005 and fiscal 2004.

              During the first half of fiscal 2006, the Company's net interest spread declined to 1.90% in comparison to 2.28% for fiscal 2005 as increases in the Company's cost of interest bearing liabilities continued to outpace the increase in the Company's yield on earning assets. This decline was attributable, in part, to the Company maintaining a comparatively higher average balance of investment securities and short term, liquid assets during the current period. These balances resulted from the initial receipt of capital from the Company's second step conversion which were deployed into such assets throughout the quarter ended December 31, 2005. Additionally, continued upward pressure on the cost of retail deposits resulted in increases in interest expense which outpaced the increase in interest income resulting from improved yields on loans. The average cost of interest bearing deposits increased 59 basis points from 2.16% for fiscal 2005 to 2.75% for the six months ended March 31, 2006. For the same comparative periods, yield on loans increased 6 basis points from 5.32% to 5.38%.

              The factors resulting in the compression of the Company's net interest spread also impacted the Company's net interest margin. However, the effects of that compression were more than offset by the impact of the additional capital raised in the Company's second-step conversion. As a result, the Company's net interest margin increased 15 basis points from 2.60% for fiscal 2005 to 2.75% for the six months ended March 31, 2006.

              Our results of operations are also affected by our provision for loan losses. Provisions for specific nonperforming assets and historical losses based on net charge-offs continue to be nominal due to a history of low charge-offs and the relative stability of nonperforming asset balances. Non-performing loans as a percentage of total assets have increased modestly to 0.32% of total assets at March 31, 2006 from 0.21% of total assets at September 30, 2005. However, management did not perceive this increase in nonperforming assets to require additional loan loss provisions. Consequently, loan loss provisions in the current year continue to be made primarily in connection with the overall growth in portfolio loans.

              Our results of operations also depend on our noninterest income and noninterest expense. Noninterest income includes deposit service fees and charges, income on the cash surrender value of life insurance, gains on sales of loans and securities, gains on sales of other real estate owned and loan related

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fees and charges. Excluding gains and losses on sale of assets, annualized noninterest income as a percentage of average assets totaled 0.26% for the six months ended March 31, 2006 - a reduction of 1 basis point from 0.27% from fiscal 2005. This decrease is primarily attributable to overall growth in average earning assets outpacing that of fee income from deposits and loans. Such growth resulted from the closing of the Company's second step conversion.

              Gains and losses on sale of assets, excluded in the comparison above, typically result from the Company selling long term, fixed rate mortgage loan originations into the secondary market for interest rate risk management purposes. Demand for such loans typically fluctuates with market interest rates. As interest rates rise, market demand for long term, fixed rate mortgage loans diminishes in favor of hybrid ARMs which the Company retains in the portfolio rather than selling into the secondary market. Consequently, the gains and losses on sale of loans reported by the Company will fluctuate with market conditions. Additionally, such gains and losses may also reflect the impact of infrequent investment security sales for asset/liability management purposes.

              Noninterest expense includes salaries and employee benefits, occupancy and equipment expenses and other general and administrative expenses. Generally, certain operating costs have increased since the Company's first public offering in the beginning of fiscal 2004. Operating as a public entity resulted in comparatively higher legal, accounting and compliance costs throughout fiscal 2004 and fiscal 2005 than had been recorded in earlier years. This trend is expected to continue as the Company incurs additional compliance costs associated with the Sarbanes-Oxley Act of 2002. Additionally, the Company is recording higher employee compensation and benefit expense than it had in the years preceding its stock offerings. Much of this increase is attributable to the implementation of ESOP benefits resulting from the Company's first and second step conversions that did not exist prior to fiscal 2004. Additionally, benefit costs increased as the Company implemented the restricted stock and stock option plans approved by shareholders during fiscal 2005.

              In the aggregate, noninterest expense as a percentage of average assets totaled 1.87% for the six months ended March 31, 2006, a decrease of 15 basis points from 2.02% for fiscal 2005. As noted above, this decrease was largely attributable to the overall growth in average earning assets which outpaced growth in noninterest expenses.

              Notwithstanding the improvements in the noninterest expense ratio noted above, management expects occupancy and equipment expense to increase in future periods as we implement our de novo branching strategy to expand our branch office network. Our current plan is to open up to five de novo branches over approximately the next three to five years. As discussed in our financial statements, we have identified a number of specific sites for de novo branches while we continue to evaluate and pursue additional retail branching opportunities. Costs for land purchase and branch construction will impact earnings going forward. The expenses associated with opening new offices, in addition to the personnel and operating costs that we will have once these offices are open, are expected to significantly increase noninterest expenses.

              The Company also expects compensation and occupancy expense to increase in future periods as additional lending staff is added to support the Bank's loan growth and diversification strategies. Implementation of these strategies will likely result in the need to augment the office space available for our lending and administrative operations in order to add the personnel called for by our growth plans.

              Finally, management expects the ongoing costs associated with the Sarbanes-Oxley Act of 2002 to also grow as outsourced providers of internal audit and other related services are utilized to augment management's compliance efforts.

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              In total, our annualized return on average assets increased 7 basis points to 0.53% for the six months ended March 31, 2006 from 0.46% for fiscal 2005 while annualized return on average equity decreased 317 basis points to 2.13% from 5.30% for the same comparative periods. The reduction in return on average equity reflects the increase in shareholder's equity resulting from the closing of the Company's second step conversion during the quarter ended December 31, 2005.

              Our net interest margin may be adversely affected in either a rising or falling rate environment. A decrease in interest rates could trigger another wave of loan refinancing that could result in the margin compression previously experienced. Conversely, further increases in interest rates from current levels could trigger increases in the Bank's cost of interest-bearing liabilities that continue to outpace its yield on earning assets causing further net interest spread compression. Such compression occurred during the six months ended March 31, 2006 when our net interest spread shrank 38 basis point to 1.90% from 2.28% for the fiscal year ended September 30, 2005. As noted earlier, this decline was attributable, in part, to the Company maintaining a comparatively higher average balance of investment securities and short term, liquid assets during the first half of fiscal 2006 than during fiscal 2005. These balances resulted from the initial receipt of capital proceeds from the Company's second step conversion which were deployed into such assets throughout the quarter ended December 31, 2005. Higher average balances of these assets limited the increase in the yield on earning assets to 12 basis points from 4.84% for fiscal 2005 to 4.96% for the six months ended March 2006.

              The increase in yield on earning assets was offset by a 50 basis point increase in the cost of interest-bearing liabilities from 2.56% for fiscal 2005 to 3.06% for the six months ended March 31, 2006. This increased cost was attributable, in large part, to overall increases in market interest rates and the resulting increases in the Company's cost of retail deposits which continue to be subject to significant upward pressure due to highly competitive market pricing for deposits.

              The risk of disintermediation of our deposits into higher cost accounts continues to be noteworthy given the Bank's substantial net growth in non-maturity deposits during the prior three years. Like many banks, we were successful in growing deposits while interest rates decreased to their historical lows. However, our ability to retain such deposits at a reasonable cost, while a highly competitive marketplace adjusts its pricing strategies to an environment of rising interest rates, continues to be rigorously tested.

              Finally, our results of operations may also be affected significantly by other economic and competitive conditions in our market area as well as changes in applicable laws, regulations or governmental policies. Furthermore, because our lending activity is concentrated in loans secured by real estate located in northern New Jersey, downturns in the regional economy encompassing New Jersey could have a negative impact on our earnings.

Comparison of Financial Condition at March 31, 2006 and September 30, 2005

              Our total assets decreased by $39.6 million, or 7.1%, to $516.3 million at March 31, 2006 from $555.9 million at September 30, 2005. The decrease reflected reductions in cash and cash equivalents, partially offset by increases in securities available for sale, securities held to maturity and loans receivable, net.

              At September 30, 2005, the Bank's total assets were inflated by $115.2 million of stock subscriptions held pending the closing of the Company's second step conversion. To better reflect the allocation of the Company's interest-earning assets and interest-costing liabilities, the September 30, 2005 information presented in the tables below utilizes the pro forma balance of total assets discussed in Note 3 of the financial statements in percentage of total assets calculations.

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              Cash and cash equivalents decreased by $106.9 million, or 85.0%, to $18.9 million at March 31, 2006 from $125.8 million at September 30, 2005. The decrease in cash and cash equivalents was largely attributable to the investment of capital proceeds received following the closing of the Company's second step conversion into loans receivable, net, securities available-for-sale and securities held-to-maturity. Additionally, the Company refunded $33.7 million of oversubscriptions upon closing the second step conversion.

              Securities classified as available-for-sale increased $30.5 million, or 49.0%, to $92.9 million at March 31, 2006 from $62.3 million at September 30, 2005. Additionally, securities held to maturity increased $4.1 million, or 51.9% to $11.9 million at March 31, 2006 from $7.8 million at September 30, 2005. The net growth in investments reflects the purchase of $57.5 million of securities during the quarter ended December 31, 2005 funded by a portion of the net proceeds received in the Company's second step conversion and the proceeds of a mutual fund sale. The sale comprised the Company's entire investment in a mutual fund whose underlying assets consisted primarily of adjustable rate and other shorter duration mortgage-related securities.

              The securities purchased comprised a combination of fixed and adjustable rate MBS, fixed rate CMOs and fixed rate, non-callable U.S. agency debentures. Securities were selected to complement the short average life and stable cash flow characteristics of the Company's existing securities portfolio. The Company expects to continue utilizing these cash flows, as well as a portion of the remaining balance of cash and cash equivalents noted above, to fund its projected growth in commercial real estate and business loans.

              The following table compares the composition of the Company's investment securities portfolio by security type as a percentage of total assets at March 31, 2006 and September 30, 2005. Amounts reported exclude unrealized gains and losses on the available for sale portfolio.

	March 31, 2006		September 30, 2005
Type of Securities	Amount	Percent of Total Assets	Amount	Percent of Pro Forma Total Assets
	(Dollars in thousands)
Fixed rate MBS	$ 16,224	3.14%	$ 13,007	2.49%
ARM MBS	28,221	5.47	7,770	1.49
Fixed rate CMO	37,795	7.31	26,111	5.00
Floating rate CMO	2,558	0.50	2,809	0.54
ARM mutual fund	-	-	10,000	1.92
Fixed rate agency debentures	21,917	4.25	11,998	2.30
Total	$ 106,715	20.67%	$ 71,695	13.74%

              Assuming no change in interest rates, the estimated average life of the investment securities portfolio, excluding the ARM mutual fund, was 2.17 years and 2.26 years at March 31, 2006 and September 30, 2005, respectively. Assuming a hypothetical immediate and permanent increase in interest rates of 300 basis points, the estimated average life of the portfolio extends to 2.54 years and 2.67 years at March 31, 2006 and September 30, 2005, respectively.

              Loans receivable, net increased by $31.0 million, or 9.1%, to $372.0 million at March 31, 2006 from $341.0 million at September 30, 2005. The growth was comprised of net increases in multi-family, commercial real estate and construction loans totaling $14.7 million coupled with net increases in commercial and business loans totaling $3.9 million. Together, net growth in these loan balances totaled

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$18.6 million comprising approximately 60% of the Company's net increase in loans receivable for the year. The remaining net growth in loans included increases in one-to-four family mortgages, including home equity loans and home equity lines of credit, totaling $12.6 million.

              The following two tables compare the composition of the Company's loan portfolio by loan type as a percentage of total assets at March 31, 2006 with that of September 30, 2005. Amounts reported exclude allowance for loan losses and net deferred origination costs.

              The table below generally defines loan type by loan maturity and/or repricing characteristics:

	March 31, 2006		September 30, 2005
Type of Loans	Amount	Percent of Total Assets	Amount	Percent of Pro Forma Total Assets
	(Dollars in thousands)
Construction	$ 7,919	1.53%	$ 1,100	0.21%
1/1 and 3/3 ARMs	5,303	1.03	3,664	0.70
3/1 and 5/1 ARMs	129,469	25.09	115,878	22.22
5/5 and 10/10 ARMs	41,091	7.96	37,079	7.11
7/1 and 10/1 ARMs	1,703	0.33	1,743	0.33
15 year fixed or less	109,616	21.23	108,731	20.85
Greater than 15 year fixed	56,500	10.94	58,852	11.28
Home equity lines of credit	16,225	3.14	13,413	2.57
Consumer	722	0.14	702	0.13
Commercial	4,653	0.90	746	0.14
Total	$ 373,201	72.29%	$ 341,908	65.54%

             The table below generally defines loan type by collateral or purpose:

	March 31, 2006		September 30, 2005
Type of Loans	Amount	Percent of Total Assets	Amount	Percent of Pro Forma Total Assets
	(Dollars in thousands)
Construction	$ 7,919	1.53%	$ 1,100	0.21%
1-4 family mortgage	277,166	53.70	267,332	51.25
Multifamily (5+) mortgage	31,976	6.19	27,519	5.28
Nonresidential mortgage	34,540	6.69	31,096	5.96
Home equity lines of credit	16,225	3.14	13,413	2.57
Consumer	722	0.14	702	0.13
Commercial	4,653	0.90	746	0.14
Total	$ 373,201	72.29%	$ 341,908	65.54%

             Total deposits decreased by $11.7 million, or 3.4%, to $329.2 million at March 31, 2006 from $340.9 million at September 30, 2005. This decrease was primarily attributable to $9.8 million of deposit balances withdrawn to purchase shares in the Company's stock offering. The remaining $1.9 million of net deposit withdrawals were primarily attributable to aggressive deposit competition in the markets served by the Company. In total, savings deposits declined $11.7 million, or 9.5% while certificates of deposit increased

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$341,000. Checking deposits, including demand, NOW and money market checking accounts, decreased $347,000 or 0.5% to $64.5 million.

The following table compares the composition of the Company's deposit portfolio by category as a percentage of total assets at March 31, 2006 with that of September 30, 2005.

	March 31, 2006		September 30, 2005
Deposit category	Amount	Percent of Total Assets	Amount	Percent of Pro Forma Total Assets
	(Dollars in thousands)
Money market checking	$ 24,228	4.69%	$ 25,759	4.94%
Other checking	40,273	7.80	39,088	7.49
Money market savings	17,787	3.45	32,736	6.28
Other savings	93,754	18.16	90,534	17.36
Certificates of deposit	153,148	29.66	152,808	29.29
Total	$ 329,190	63.76%	$ 340,925	65.36%

              FHLB advances decreased $1.3 million, or 2.5%, to $52.4 million at March 31, 2006 due to scheduled principal repayments of advance amortization and maturities.

              The following table compares the composition of the Company's borrowing portfolio by remaining term to maturity as a percentage of total assets at March 31, 2006 with that of September 30, 2005. Scheduled principal payments on amortizing borrowings are reported as maturities.

	March 31, 2006		September 30, 2005
Remaining Term	Amount	Percent of Total Assets	Amount	Percent of Pro Forma Total Assets
	(Dollars in thousands)
Overnight	$ 700	0.14%	$ -	-%
One year or less	9,061	1.76	8,060	1.55
One to two years	6,064	1.17	8,062	1.55
Two to three years	14,067	2.72	12,065	2.30
Three to four years	7,513	1.46	7,547	1.45
Four to five years	6,000	1.16	6,000	1.15
More than five years	9,000	1.74	12,000	2.30
Total	$ 52,405	10.15%	$ 53,734	10.30%

              Equity increased $89.1 million, or 225.6% to $128.6 million at March 31, 2006 from $39.5 million at September 30, 2005. The increase was primarily due to capital proceeds of $89.6 million resulting from the Company's closing of its second step conversion. The increase also reflects net income of $1.4 million for the six months ended March 31, 2006, offset by dividends paid of approximately $1.0 million. Further, the amount reclassified on ESOP shares decreased $473,000 to $0. On October 5, 2005, the Company completed its second step offering (as discussed in Note 3 to the consolidated financial statements). On October 6, 2005, the Company began trading on Nasdaq which is considered to be an established market under ERISA regulations. As a result, effective October 6, 2005, the Company is no longer required to establish a liability to reflect this repurchase obligation.

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Comparison of Operating Results for the Three Months Ended March 31, 2005 and March 31, 2005

              General. Net income for the three months ended March 31, 2006 was $688,000, an increase of $104,000, or 17.8% from the three months ended March 31, 2005. The increase in net income resulted from an increase in net interest income and non-interest income offset by an increase in noninterest expense, the provision for loan losses and the provision for income taxes.

              Interest Income. Total interest income increased 22.6% or $1.1 million to $6.2 million for the three months ended March 31, 2006 from $5.1 million for the three months ended March 31, 2005. For those same comparative quarters, the average yield on interest-earning assets increased 19 basis points to 5.04% from 4.85% while the average balance of interest-earning assets increased $75.0 million or 17.9% to $494.8 million from $419.8 million.

              Interest income on loans increased $502,000 or 11.6%, to $4.8 million for the three months ended March 31, 2006 from $4.3 million for the same quarter in 2005. This increase was due, in part, to a $35.9 million increase in the average balance of loans receivable to $360.4 million for the quarter ended March 31, 2006 from $324.4 million for the quarter ended March 31, 2005. In addition, the average yield on loans increased 2 basis points to 5.38% from 5.36% for those same comparative periods. The increase in the average balance of loans receivable was the result of loan originations exceeding repayments due to strong borrower demand and a growing strategic emphasis on commercial real estate lending.

              The rise in interest income on loans was augmented by higher interest income on securities, which increased $421,000 or 59.2% to $1.1 million for the three months ended March 31, 2006 from $711,000 for the same three months in 2005. The increase was due in part, to a 90 basis point increase in the average yield on securities which grew to 4.11% from 3.21% for the same comparative periods. The impact on interest income attributable to this increase was further enhanced by a $21.5 million increase in the average balance of investment securities to $110.1 million for the three months ended March 31, 2006 from $88.5 million for the same 2005 period. The increase in yield primarily resulted from purchases of investment securities with the proceeds of the Company's second step conversion and, to a lesser extent, on slowing prepayments which reduced net premium amortization and higher yields on adjustable rate securities which have repriced upward in accordance with the general movement of market interest rates.

              Further, interest income on federal funds sold and other interest-bearing deposits increased $227,000 to $260,000 for the three months ended March 31, 2006 from $33,000 for the same period in 2005. This increase was due, in part, to an increase of $17.5 million in the average balance of these assets to $24.3 million for the three months ended March 31, 2006 from $6.9 million for the three months ended March 31, 2005. The impact on interest income attributable to this growth was further augmented by a 237 basis point rise in the average yield on these assets which increased to 4.27% from 1.90% due largely to increases in market interest rates.

              Interest Expense. Total interest expense increased by $530,000 or 23.6% to $2.8 million for the three months ended March 31, 2006 from $2.2 million for the same three months in fiscal 2005. For those same comparative periods, the average cost of interest-bearing liabilities increased 69 basis points from 2.44% to 3.13%, while the average balance of interest-bearing liabilities declined $13.1 million or 3.6% to $354.1 million for the three months ended March 31, 2006 from $367.2 million for the same quarter in fiscal 2005.

              Interest expense on deposits increased $602,000 or 39.2% to $2.1 million for the quarter ended March 31, 2006 from $1.5 million for the quarter ended March 31, 2005. This increase was due, in part, to an 82 basis point increase in the average cost of interest-bearing deposits to 2.84% for the quarter ended March 31, 2006 from 2.02% for the same quarter in fiscal 2005. The components of this increase include an 83 basis point increase in the average cost of certificates of deposit, a 96 basis point increase in the average

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cost of interest-bearing checking accounts and a 46 basis point increase in the average cost of savings accounts. The increase in the average cost was partly offset by a decline of $2.2 million in the average balance of interest-bearing deposits for those same comparative periods. The components of this net decrease for the comparative periods include an increase of $24.1 million in the average balance of certificates of deposit, a $28.0 million decrease in the average balance of savings accounts and a $1.6 million increase in the average balance of interest-bearing checking accounts.

              Interest expense on FHLB advances decreased $72,000 to $635,000 for the three months ended March 31, 2006 from $707,000 for the same period in fiscal 2005. This decrease was due, in part, to a $10.9 million decrease in the average balance to $52.7 million for the three months ended March 31, 2006 from $63.7 million for the same three months in fiscal 2005. The impact on expense attributable to this decrease in average balance was partly offset by a 38 basis point increase in the average cost of advances from 4.45% for the three months ended March 31, 2005 to 4.83% for the same period in fiscal 2006. The higher average cost for the current quarter is primarily due to the lower average balance of overnight repricing line of credit borrowings compared with that held during the earlier comparative quarter. The cost of such overnight borrowings during that earlier quarter was significantly less than that of the remaining portfolio of fixed-rate term advances.

             Net Interest Income. Net interest income increased by $620,000 or 21.8%, to $3.5 million for the three months ended March 31, 2006 from $2.8 million for the three months ended March 31, 2005. The net interest rate spread declined 50 basis points from 2.41% to 1.91% for the same comparative periods, while the net interest margin increased 9 basis points from 2.71% to 2.80%.

             Provision for Loan Losses. Using the allowance methodology described earlier, the provision for loan losses totaled $159,000 for the three months ended March 31, 2006 representing an increase of $89,000 over the same three months in 2005. The comparative three month provisions generally resulted from the incremental growth in the outstanding balance of the loans on which historical and environmental loss factors are applied. For the three months ended March 31, 2006, loans receivable, net increased 5.0% to $372.0 million from $354.2 million at December 31, 2005. Total gross loan balances, excluding loans held for sale, net deferred loan costs and the allowance for loan loss, grew $17.9 million. The growth was comprised of a net increase in the disbursed balances of construction loans of $3.3 million, net increases in multi-family and commercial real estate loans totaling $6.0 million and a net increase in commercial loans totaling $2.8 million. Additional components of the net change in gross loan balances included net increases in one-to-four family mortgages totaling $6.0 million coupled with increases in home equity loans of $329,000.

              By comparison, loan growth for the three months ended March 31, 2005 totaled $14.8 million or $3.1 million less than the same comparative period this year. The growth in this prior comparative period was comprised of an increase in one-to-four family mortgages totaling $10.2 million, an increase of $3.7 million in multi-family and commercial real estate loans, an increase of $218,000 in commercial loans, an increase of $16,000 in home equity loans and by net increases in the disbursed balances of construction loans totaling $949,000, offset by a decrease in consumer loans totaling $18,000.

              In total, the allowance for loan losses as a percentage of gross loans outstanding increased 1 basis point to 0.51% at March 31, 2006 from 0.50% at March 31, 2005. These ratios reflect allowance for loan loss balances of $1.9 million and $1.7 million, respectively. The level of the allowance is based on estimates and the ultimate losses may vary from those estimates.

              Noninterest Income. Noninterest income increased $82,000 to $372,000 for the three months ended March 31, 2006 compared to $290,000 for the same period in 2005. This increase was primarily attributable to increases in deposit service fees, loan related fee income and improvement in income from cash surrender value of life insurance. Deposit service fees and charges increased $37,000 while

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income from cash surrender value of life insurance increased by $7,000 reflecting higher policy balances held by the Company. In addition, gain on sale of held-for-sale loans increased $6,000 and other noninterest income increased by $32,000 resulting primarily from collection of comparatively higher loan prepayment penalties.

              Noninterest Expense. Noninterest expense increased $410,000, or 19.0% to $2.6 million for the three months ended March 31, 2006 from $2.2 million for the three months ended March 31, 2005. This increase was attributable to higher expenses for salaries and benefits, occupancy and equipment, data processing, professional and consulting fees, and other noninterest expenses, partially offset by decreases in advertising and legal fees.

              Salaries and employee benefits increased $354,000 or 26.5% to $1.7 million for the three months ended March 31, 2006 as compared to $1.3 million for the same period in 2005. Salaries and wages including bonus and payroll taxes, increased $189,000 or 20.3% due, in large part, to executive and lending staffing additions coupled with overall annual increases in employee compensation. Retirement and stock benefit plan costs increased $113,000. This increase was due, in large part, to a $83,000 increase in ESOP expenses attributable to increased plan benefits arising from the Company's second step conversion (See Note 5 Employee Stock Ownership Plan) coupled with overall increases in ABNJ share value. Additionally, the Company recorded restricted stock plan and stock option benefit plan expenses of $71,000 and $63,000, respectively, for the three months ended March 31, 2006. By comparison, such expenses during the same period in 2005 totaled $66,000 and were limited to restricted stock plan expenses as the Company had not yet adopted FAS 123R. Together, these factors contributed $68,000 to the comparative increase in retirement and stock benefit plan costs. These benefit cost increases were partly offset by a decrease in profit sharing expense of $44,000 resulting from the absence of such expense in the current fiscal year due to the Company's discontinuation of that plan. Further, medical and other insurance benefit premiums, net of employee co-payments, increased $15,000 or 14.0%. Finally, various employee expenses increased $38,000 resulting primarily from comparatively greater costs associated with employee training and personnel procurement expenses.

              Occupancy and equipment expense increased $2,000 to $206,000 for the three months ended March 31, 2006 as compared to $204,000 for the same three months in fiscal 2005. This decrease was primarily attributable to a $5,000 decrease in equipment and computer depreciation expense, offset by higher expenses for utilities expense. For the same comparative periods, data processing costs increased $9,000 from $148,000 to $157,000 primarily due to upcoming enhancements to the Company's internet banking systems.

              Legal fees decreased $58,000 to $23,000 for the three months ended March 31, 2006 from $81,000 for the three months ended March 31, 2005. This decrease was due, in part, to the recording of legal expenses in the earlier comparative quarter which related to matters including those addressed at the Company's annual meeting held in January 2005. Offsetting this decrease were increases in professional and consulting fees, including auditing and accounting expenses, which increased $38,000 to $137,000 for those same comparative periods. In large part, these increases were attributable to consulting costs incurred by the Company relating to compliance with the Sarbanes Oxley Act of 2002 and the outsourcing of other internal audit-related services.

              Advertising expenses decreased $3,000 or 4.0% to $73,000 for the three months ended March 31, 2006 from $76,000 for the three months ended March 31, 2005, due to lower expenses for agency fees offset, in part, by higher expenses for print ads, promotions, and other marketing initiatives. Finally, other noninterest expenses increased $68,000 for the same comparative six months periods due, in large part, to increases in net loan processing charges and other general and administrative expenses.

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             Provision for Income Taxes. The provision for income taxes increased $99,000 for the three months ended March 31, 2006 from the same period in fiscal 2005. The effective tax rate was 38.3% and 36.0% for the three months ended March 31, 2006 and 2005, respectively. The increase in the effective tax rate was primarily attributable to the decline in the average balance of investment securities held by the Bank's investment subsidiary, American Savings Investment Corporation ("ASIC"). ASIC is a wholly owned New Jersey investment subsidiary formed in August 2004 by American Bank of New Jersey. The purpose of this subsidiary is to invest in stocks, bonds, notes and all types of equity, mortgages, debentures and other investment securities. Interest income from this subsidiary is taxed by the state of New Jersey at an effective rate lower than the statutory corporate state income tax rate.

               Throughout fiscal 2006, cash flows from ASIC continued to be utilized by the Bank to fund loan growth. This resulted in comparatively lower net income recorded by the investment subsidiary offset by greater net income recorded by the Bank resulting in the increase in the Company's effective income tax rate.

              Additionally, the Company recorded non-deductible expenses associated with incentive stock options issued under the 2005 Stock Option Plan which increased the Company's effective income tax rate.

              Comparison of Operating Results for the Six Months Ended March 31, 2006 and March 31, 2005

       General. Net income for the six months ended March 31, 2006 was $1.4 million, an increase of $157,000, or 13.2% from the six months ended March 31, 2005. The increase in net income resulted from an increase in net interest income partially offset by a decrease in non-interest income coupled with increases in noninterest expense, the provision for loan losses and the provision for income taxes.

       Interest Income. Total interest income increased 23.3% or $2.3 million to $12.3 million for the six months ended March 31, 2006 from $10.0 million for the six months ended March 31, 2005. For those same comparative quarters, the average yield on interest-earning assets increased 16 basis points to 4.96% from 4.80% while the average balance of interest-earning assets increased $80.5 million or 19.3% to $497.2 million from $416.7 million.

              Interest income on loans increased $1.1 million or 12.4%, to $9.5 million for the six months ended March 31, 2006 from $8.5 million for the same period in 2005. This increase was due, in part, to a $36.2 million increase in the average balance of loans receivable to $354.7 million for the six months ended March 31, 2006 from $318.5 million for the six months ended March 31, 2005. In addition, the average yield on loans increased 5 basis points to 5.38% from 5.33% for those same comparative periods. The increase in the average balance of loans receivable was the result of loan originations exceeding repayments due to strong borrower demand and a growing strategic emphasis on commercial real estate lending.

              The rise in interest income on loans was augmented by higher interest income on securities, which increased $459,000 or 31.7% to $1.9 million for the six months ended March 31, 2006 from $1.4 million for the same six months in 2005. The increase was due in part, to a 76 basis point increase in the average yield on securities which grew to 3.94% from 3.18% for the same comparative periods. The impact on interest income attributable to this increase was further augmented by a $5.9 million increase in the average balance of investment securities to $97.0 million for the six months ended March 31, 2006 from $91.1 million for the same 2005 period. The increase in yield primarily resulted from purchases of investment securities with the proceeds of the Company's second step conversion and, to a lesser extent, on slowing prepayments which reduced net premium amortization and higher yields on adjustable rate securities which have repriced upward in accordance with the general movement of market interest rates.

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              Further, interest income on federal funds sold and other interest-bearing deposits increased $811,000 to $872,000 for the six months ended March 31, 2006 from $61,000 for the same period in 2005. This increase was due, in part, to an increase of $38.4 million in the average balance of these assets to $45.5 million for the six months ended March 31, 2006 from $7.1 million for the six months ended March 31, 2005. The impact on interest income attributable to this growth was further augmented by a 211 basis point rise in the average yield on these assets which increased to 3.83% from 1.72%.

              Interest Expense. Total interest expense increased by $1.1 million or 23.8% to $5.5 million for the six months ended March 31, 2006 from $4.4 million for the same six months in fiscal 2005. For those same comparative periods, the average cost of interest-bearing liabilities increased 63 basis points from 2.43% to 3.06%, while the average balance of interest-bearing liabilities decreased $5.8 million or 1.6% to $357.8 million for the six months ended March 31, 2006 from $363.6 million for the same six months in fiscal 2005.

              Interest expense on deposits increased $1.2 million or 38.6% to $4.2 million for the six months ended March 31, 2006 from $3.0 million for the same period in fiscal 2005. This increase was due, in part, to a $2.8 million increase in the average balance of interest-bearing deposits to $304.6 million for the six months ended March 31, 2006 from $301.8 million for the same period in fiscal 2005. The components of this net increase for the comparative periods include an increase of $28.9 million in the average balance of certificates of deposit and a $1.4 million increase in the average balance of interest-bearing checking accounts partially offset by a $27.6 million decrease in the average balance of savings accounts.

              The impact on interest expense attributable to the net growth in these average balances was exacerbated by a 75 basis point increase in the average cost of interest-bearing deposits to 2.75% for the six months ended March 31, 2006 from 2.00% for the same period in fiscal 2005. The components of this increase include an 82 basis point increase in the average cost of certificates of deposit, a 94 basis point increase in the average cost of interest-bearing checking accounts and a 29 basis point increase in the average cost of savings accounts.

              Interest expense on FHLB advances decreased $113,000 to $1.3 million for the six months ended March 31, 2006 from $1.4 million for the same period in fiscal 2005. This decrease was due, in part, to an $8.6 million decrease in the average balance to $53.2 million for the six months ended March 31, 2006 from $61.8 million for the same six months in fiscal 2005. The impact on expense attributable to this decrease in average balance was partly offset by a 32 basis point increase in the average cost of advances from 4.54% for the six months ended March 31, 2005 to 4.85% for the same period in fiscal 2006. The higher average cost for the current period was primarily due to the lower average balance of overnight repricing line of credit borrowings compared with that held during the earlier comparative period. The cost of such overnight borrowings during that earlier period was significantly less than that of the remaining portfolio of fixed-rate term advances.

             Net Interest Income. Net interest income increased by $1.2 million or 22.9%, to $6.8 million for the six months ended March 31, 2006 from $5.6 million for the six months ended March 31, 2005. The net interest rate spread declined 46 basis points from 2.36% to 1.90% for the same comparative periods, while the net interest margin increased 8 basis points from 2.67% to 2.75%.

              Provision for Loan Losses. Using the allowance methodology described earlier, the provision for loan losses totaled $246,000 for the six months March 31, 2006 representing an increase of $134,000 over the same six months in 2005. The comparative six month provisions generally resulted from the incremental growth in the outstanding balance of the loans on which historical and environmental loss factors are applied. For the six months ended March 31, 2006, loans receivable, net increased 9.1% to $372.0 million from $341.0 million at September 30, 2005. Total gross loan balances, excluding loans held for sale, net deferred loan costs and the allowance for loan loss, grew $31.2 million or 9.1%. The growth

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was comprised of a net increase in the disbursed balances of construction loans of $1.1 million, net increases in multi-family and commercial real estate loans totaling $7.9 million and a net increase in commercial loans totaling $3.9 million. Additional components of the net change in gross loan balances included net increases in one-to-four family mortgages totaling $9.8 million coupled with increases in home equity loans of $2.8 million.

              By comparison, loan growth for the six months ended March 31, 2005 totaled $24.4 million or $6.8 million less than the same comparative period this year. The growth in this prior comparative period was comprised of an increase in one-to-four family mortgages totaling $10.6 million, an increase of $12.3 million in multi-family and commercial real estate loans, an increase of $265,000 in commercial loans, an increase of $707,000 in home equity loans and by net increases in the disbursed balances of construction loans totaling $838,000, offset by a decrease in consumer loans totaling $45,000.

              In total, the allowance for loan losses as a percentage of gross loans outstanding increased 1 basis point to 0.51% at March 31, 2006 from 0.50% at March 31, 2005. These ratios reflect allowance for loan loss balances of $1.9 million and $1.7 million, respectively. The level of the allowance is based on estimates and the ultimate losses may vary from those estimates.

              Noninterest Income. Noninterest income decreased $139,000 to $398,000 for the six months ended March 31, 2006 compared to $537,000 for the same period in 2005. This reduction was primarily attributable to a $271,000 loss on sale of an underperforming investment security during the prior quarter ended December 31, 2005. Excluding that loss, comparative noninterest income for the six months ended March 31, 2006 would have increased by $132,000 due largely to increases in deposit service fees, loan related fee income and improvement in income from cash surrender value of life insurance. Deposit service fees and charges increased $46,000 while income from cash surrender value of life insurance increased by $22,000 reflecting higher policy balances held by the Company. In addition, gain on sale of held-for-sale loans increased $7,000 and other noninterest income increased by $57,000 resulting primarily from collection of comparatively higher loan prepayment penalties.

              Noninterest Expense. Noninterest expense increased $698,000, or 17.0% to $4.8 million for the six months ended March 31, 2006 from $4.1 million for the six months ended March 31, 2005. This increase was attributable to higher expenses for salaries and benefits, data processing, professional and consulting fees, and other noninterest expenses, partially offset by decreases in occupancy and equipment, advertising and legal fees.

              Salaries and employee benefits increased $542,000 or 21.3% to $3.1 million for the six months ended March 31, 2006 as compared to $2.5 million for the same period in 2005. Salaries and wages including bonus and payroll taxes, increased $281,000 or 15.4% due, in part, to executive and lending staffing additions coupled with overall annual increases in employee compensation. Retirement and stock benefit plan costs increased $170,000. This increase was due in large part to a $157,000 increase in ESOP expenses attributable to increased plan benefits arising from the Company's second step conversion (See Note 5 Employee Stock Ownership Plan). Additionally, the Company recorded restricted stock plan and stock option benefit plan expenses of $156,000 and $126,000, respectively, for the six months ended March 31, 2006. By comparison, such expenses during the same period in 2005 totaled $66,000. This amount included only three months of RSP expenses reflecting plan approval by shareholders in January 2005 and no expenses associated with stock option plans as the Company had not yet adopted FAS 123R. Together, these factors contributed $215,000 to the comparative increase in retirement and stock benefit plan costs. These benefit cost increases were partly offset by a decrease in profit sharing expense of $219,000 resulting from the absence of such expense in the current fiscal year due to the Company's discontinuation of that plan. Further, medical and other insurance benefit premiums, net of employee co-payments, increased $26,000 or 12.1%. Finally, various employee expenses increased $66,000 resulting

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primarily from comparatively greater costs associated with employee training and personnel procurement expenses.

              Occupancy and equipment expense decreased $4,000 to $405,000 for the six months ended March 31, 2006 as compared to $409,000 for the same six months in fiscal 2005. This decrease was primarily attributable to a $10,000 decrease in computer depreciation expense, offset by higher expenses for utilities expense. For the same comparative periods, data processing costs increased $22,000 from $293,000 to $315,000 primarily due to upcoming enhancements to the Company's internet banking systems.

              Legal fees decreased $48,000 to $108,000 for the six months ended March 31, 2006 from $156,000 for the six months ended March 31, 2005. This decrease was due, in part, to the recording of legal expenses in the earlier comparative period which related to matters including those addressed at the Company's annual meeting held in January 2005. Offsetting this decrease were increases in professional and consulting fees, including auditing and accounting expenses, which increased $89,000 to $255,000 for those same comparative periods. In large part, these increases were attributable to consulting costs incurred by the Company relating to compliance with the Sarbanes Oxley Act of 2002 and the outsourcing of other internal audit-related services.

              Advertising expenses decreased $15,000 or 10.7% to $125,000 for the six months ended March 31, 2006 from $140,000 for the six months ended March 31, 2005, due to lower expenses for agency fees offset, in part, by higher expenses for print ads, promotions, and other marketing initiatives. Finally, other noninterest expenses increased $112,000 for the same comparative six months periods due, in large part, to increases in net loan processing charges and other general and administrative expenses.

             Provision for Income Taxes. The provision for income taxes increased $146,000 for the six months ended March 31, 2006 from the same period in fiscal 2005. The effective tax rate was 38.3% and 36.7% for the six months ended March 31, 2006 and 2005, respectively. The increase in the effective tax rate was primarily attributable to the decline in the average balance of investment securities held by the Bank's investment subsidiary, American Savings Investment Corporation ("ASIC"). ASIC is a wholly owned New Jersey investment subsidiary formed in August 2004 by American Bank of New Jersey. The purpose of this subsidiary is to invest in stocks, bonds, notes and all types of equity, mortgages, debentures and other investment securities. Interest income from this subsidiary is taxed by the state of New Jersey at an effective rate lower than the statutory corporate state income tax rate.

               Throughout fiscal 2006, cash flows from ASIC were utilized by the Bank to fund loan growth. This resulted in comparatively lower net income recorded by the investment subsidiary offset by greater net income recorded by the Bank resulting in the increase in the Company's effective income tax rate.

              Additionally, the Company recorded non-deductible expenses associated with incentive stock options issued under the 2005 Stock Option Plan which increased the Company's effective income tax rate.

Liquidity and Commitments

              We are required to have enough investments that qualify as liquid assets in order to maintain sufficient liquidity to ensure a safe and sound operation. Liquidity may increase or decrease depending upon the availability of funds and comparative yields on investments in relation to the return on loans. Historically, we have maintained liquid assets above levels believed to be adequate to meet the requirements of normal operations, including potential deposit outflows. Cash flow projections are regularly reviewed and updated to assure that adequate liquidity is maintained.

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              The Bank's short term liquidity, represented by cash and cash equivalents, is a product of its operating, investing and financing activities. The Bank's primary sources of funds are deposits, amortization, prepayments and maturities of outstanding loans and mortgage-backed securities, maturities of investment securities and other short-term investments and funds provided from operations. While scheduled payments from the amortization of loans and mortgage-backed securities and maturing investment securities and short-term investments are relatively predictable sources of funds, deposit flows and loan prepayments are greatly influenced by general interest rates, economic conditions, and competition. In addition, the Bank invests excess funds in short-term interest-earning assets, which provide liquidity to meet lending requirements. The Bank also generates cash through borrowings. The Bank utilizes Federal Home Loan Bank advances to leverage its capital base and provide funds for its lending and investment activities, and to enhance its interest rate risk management.

              Liquidity management is both a daily and long-term function of business management. Excess liquidity is generally invested in short-term investments such as overnight deposits or U.S. Agency securities. On a longer-term basis, the Bank maintains a strategy of investing in various loan products and in securities collateralized by loans. The Bank uses its sources of funds primarily to meet its ongoing commitments, to pay maturing certificates of deposit and savings withdrawals, to fund loan commitments and to maintain its portfolio of mortgage-backed securities and investment securities. At March 31, 2006, the total approved loan origination commitments outstanding amounted to $17.3 million. At the same date, unused lines of credit were $19.9 million and construction loans in process were $10.7 million.

              Certificates of deposit scheduled to mature in one year or less at March 31, 2006, totaled $108.9 million. Management's policy is to maintain deposit rates at levels that are competitive with other local financial institutions. Based on the competitive rates and on historical experience, management believes that a significant portion of maturing deposits will remain with the Bank. Additionally, at March 31, 2006 the Bank has $9.8 million of borrowings from the Federal Home Loan Bank of New York ("FHLB") maturing in one year or less. Repayment of such advances increases the Bank's unused borrowing capacity from the FHLB which, at March 31, 2006 totaled $67.0 million. In calculating our borrowing capacity, the Bank utilizes the Federal Home Loan Bank's guideline, which generally limits advances secured by residential mortgage collateral to 25% of the Bank's total assets.

              The following tables disclose our contractual obligations and commercial commitments as of March 31, 2006. Scheduled principal payments on amortizing borrowings are reported as maturities.

	Total	Less Than 1 Year	1-3 Years	4-5 Years	After 5 Years
	(In thousands)
Time Deposits	$ 153,148	$ 108,929	$ 29,224	$ 4,827	$ 10,168
Federal Home Loan Bank advances(1)	52,405	9,761	20,130	13,514	9,000
Total	$ 205,553	$ 118,690	$ 49,354	$ 18,341	$ 19,168

___________________

(1) At March 31, 2006, the total collateralized borrowing limit was $119.4 million of which we had $52.4 million outstanding.

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	Total Amounts Committed	Less Than 1 Year	1-3 Years	4-5 Years	Over 5 Years
	(In thousands)
Lines of credit(1)	$ 19,862	$ 2,415	$ 914	$ 575	$ 15,958
Construction loans in process	10,687	350	10,337	-	-
Other commitments to extend credit	17,336	17,336	-	-	-
Total	$ 47,885	$ 20,101	$ 11,251	$ 575	$ 15,958

___________________

(1) Represents amounts committed to customers.

              In addition to the above commitments, the Company has financial obligations regarding outstanding contracts for sale relating to future branch sites. As of March 31, 2006, the Bank has paid deposits totaling $417,500 on sale contracts for future branch locations. Upon closing, the Bank is committed to disbursing an additional $4,957,500 to fulfill its obligations under these contracts. These commitments are contingent upon the fulfillment of certain conditions outlined in the sale contracts.

              Capital

Consistent with its goals to operate a sound and profitable financial organization, American Bank of New Jersey actively seeks to maintain a "well capitalized" institution in accordance with regulatory standards. The Bank's total equity was $80.7 million at March 31, 2006, or 16.89% of total assets on that date. As of March 31, 2006, the Bank exceeded all capital requirements of the Office of Thrift Supervision. The Bank's regulatory capital ratios at March 31, 2006 were as follows: core capital 17.08%; Tier I risk-based capital, 29.92%; and total risk-based capital, 30.58%. The regulatory capital requirements to be considered well capitalized are 5.0%, 6.0% and 10.0%, respectively.

Impact of Inflation

              The consolidated financial statements presented herein have been prepared in accordance with accounting principles generally accepted in the United States of America. These principles require the measurement of financial position and operating results in terms of historical dollars, without considering changes in the relative purchasing power of money over time due to inflation.

              Our primary assets and liabilities are monetary in nature. As a result, interest rates have a more significant impact on our performance than the effects of general levels of inflation. Interest rates, however, do not necessarily move in the same direction or with the same magnitude as the price of goods and services, since such prices are affected by inflation. In a period of rapidly rising interest rates, the liquidity and maturity structure of our assets and liabilities are critical to the maintenance of acceptable performance levels.

              The principal effect of inflation, as distinct from levels of interest rates, on earnings is in the area of noninterest expense. Such expense items as employee compensation, employee benefits and occupancy and equipment costs may be subject to increases as a result of inflation. An additional effect of inflation is the possible increase in the dollar value of the collateral securing loans that we have made. We are unable to determine the extent, if any, to which properties securing our loans have appreciated in dollar value due to inflation.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

             Qualitative Analysis. Because the income on the majority of our assets and the cost of the majority of our liabilities are sensitive to changes in interest rates, a significant form of market risk for us is interest rate risk, or changes in interest rates. Notwithstanding the unpredictability of future interest rates, we expect that changes in interest rates may have a significant, adverse impact on our net interest income.

             Our ability to make a profit largely depends on our net interest income, which could be negatively affected by changes in interest rates. Net interest income is the difference between:

• The interest income we earn on our interest-earning assets such as loans and securities; and
 

• The interest expense we pay on our interest-bearing liabilities such as deposits and amounts we borrow.

             The rates we earn on our assets and the rates we pay on our liabilities are generally fixed for a contractual period of time. We, like many savings institutions, have liabilities that generally have shorter contractual maturities than our assets. This imbalance can create significant earnings volatility, because market interest rates change over time. In a period of rising interest rates, the interest income earned on our assets may not increase as rapidly as the interest paid on our liabilities. In a period of declining interest rates the interest income earned on our assets may decrease more rapidly, due to accelerated prepayments, than the interest paid on our liabilities.

             In addition, changes in interest rates can affect the average lives of loans and mortgage-backed and related securities. For example, a reduction in interest rates results in increased prepayments of loans and mortgage-backed and related securities, as borrowers refinance their debt in order to reduce their borrowing cost. This causes reinvestment risk, because we are generally not able to reinvest prepayments at rates that are comparable to the rates we previously earned on the prepaid loans or securities. By contrast, increases in interest rates reduce the incentive for borrowers to refinance their debt. In such cases, prepayments on loans and mortgage-backed and related securities may decrease thereby extending the average lives of such assets and reducing the cash flows that are available to be reinvested by the Company at higher interest rates. At March 31, 2006, 74.3% of our loan portfolio was comprised of one- to four-family mortgage loans, which experienced very high prepayment rates during recent years.

             Tables presenting the composition and allocation of the Company's interest-earning assets and interest-costing liabilities from an interest rate risk perspective are presented in the preceding section of this report titled "Comparison of Financial Condition at March 31, 2006 and September 30, 2005." These tables present the Company's investment securities, loans, deposits, and borrowings by categories that reflect the contractual repricing characteristics of the underlying assets or liabilities. Presented as a percentage of total assets, the comparative data presents changes in the repricing characteristics of the Company's balance sheet - an important component of interest rate risk.

             Our net interest rate spread is the difference between the yields we receive on our interest-earning assets and the rates we pay on our interest-costing liabilities. Through the first half of fiscal 2005, the Company continued to realize improvements in its net interest spread as increases in earning asset yields continued to outpace increases in the cost of its interest bearing-liabilities. However, that trend reversed in the latter half of 2005 when upward pressure on the Company's cost of deposits resulted in greater increases in the Company's cost of interest-bearing liabilities than those of its interest earning assets. The trend of net interest spread compression continued in the six months ended March 31, 2006 during which our net interest spread decreased to 1.90% from 2.28% for the year ended September 30, 2005.

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             In large part, this net interest rate spread compression resulted from an increase in the Company's cost of interest-bearing liabilities which outpaced the increase in the Company's yield on earning assets. This decline was attributable, in part, to the Company maintaining a comparatively higher average balance of shorter duration investment securities and short term, liquid assets during the current fiscal year. These balances resulted from the initial receipt of capital proceeds from the Company's second step conversion which were deployed into higher yielding investment securities throughout the quarter ended December 31, 2005. Additionally, continued upward pressure on the cost of retail deposits resulted in increases in interest expense which outpaced the increase in interest income resulting from improved yields on loans.

             Depending upon the movement of market interest rates, our earnings may continue to be impacted by an "earnings squeeze" in the future. For example, we are vulnerable to an increase in interest rates because the majority of our loan portfolio consists of longer-term, fixed rate loans and recently originated hybrid ARMs that are fixed rate for an initial period of time. At March 31, 2006, excluding allowance for loan losses and net deferred origination costs and including loans held for sale, loans totaled $373.2 million comprising 72.3% of total assets. Of those loans, fixed rate mortgages totaled $166.1 million or 32.2% of total assets while hybrid ARMs, including 3/1, 5/1, 7/1, and 10/1 ARMs totaled $177.6 million or 34.4% of total assets. In an increasing rate environment, our cost of funds may increase more rapidly than the interest earned on our loan portfolio and investment securities portfolio because our primary source of funds is deposits with substantially shorter maturities than the maturities on our loans and investment securities. Having interest-bearing liabilities that reprice more frequently than interest-earning assets will be detrimental during periods of rising interest rates and could cause our net interest rate spread to shrink because the increase in the rates we would earn on our securities and loan portfolios would be less than the increase in the rates we would pay on deposits and borrowings. This could cause a decrease in our earnings and an "earnings squeeze" just as the decrease in interest rates in prior periods had impacted our earnings.

             The Board of Directors has established an Asset/Liability Management Committee, comprised of the Bank's Chief Executive Officer, the Bank's President and Chief Operating Officer, the Bank's Executive Vice President and Corporate Secretary, the Bank's Senior Vice President and Chief Financial Officer, the Bank's Senior Vice President and Chief Lending Officer and the Bank's Vice President and Controller, which is responsible for monitoring interest rate risk. The committee conducts regular, informal meetings, generally on a weekly basis, to address the day-to-day management of the assets and liabilities of the Bank, including review of the Bank's short term liquidity position; loan and deposit pricing and production volumes and alternative funding sources; current investments; average lives, durations and repricing frequencies of loans and securities; and a variety of other asset and liability management topics. The committee meets quarterly to formally review such matters. The results of the committee's quarterly review are reported to the full Board, which makes adjustments to the Bank's interest rate risk policy and strategies, as it considers necessary and appropriate.

             To reduce the effect of interest rate changes on net interest income, we may utilize various strategies aimed at improving the matching of interest-earning asset maturities to interest-bearing liability maturities. The strategies may include:

(1)	Originate and retain loans with adjustable rate features and fixed rate loans with shorter maturities including commercial real estate, construction and business loans;
(2)	Originate longer-term, fixed rate loans eligible for sale in the secondary market and, if warranted, sell such loans;
(3)	Lengthen the maturities of our liabilities through utilization of Federal Home Loan Bank advances;

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(4)	Attract low cost checking and transaction accounts which tend to be less interest rate sensitive; and
(5)	Purchase short to intermediate term securities and maintain a securities portfolio that provides a stable cash flow, thereby providing investable funds in varying interest rate cycles.

              Quantitative Aspects of Market Risk. The following table presents American Bank of New Jersey's net portfolio value as of December 31, 2005, the latest date for which information is available. The net portfolio value was calculated by the Office of Thrift Supervision, based on information provided by the Bank.

Net Portfolio Value			Net Portfolio Value as % of Present Value of Assets			Board Established Limits
Changes in Rates(1)	$ Amount	$ Change	% Change	Net Portfolio Value Ratio	Basis Point Change	Net Portfolio Value Ratio	Basis Point Change
(Dollars in thousands)
+300 bp	69,344	-20,099	-22%	15.26%	-313bp	5.00%	-450bp
+200 bp	76,579	-12,863	-14%	16.46%	-193bp	6.00%	-300bp
+100 bp	83,361	-6,081	-7%	17.51%	-88bp	7.00%	-150bp
0 bp	89,442			18.39%		8.00%
-100 bp	93,480	4,038	+5%	18.88%	+49bp	7.00%	-150bp
-200 bp	93,812	4,370	+5%	18.74%	+35 bp	6.00%	-300bp

⁽¹⁾    The -300bp scenario is not shown due to the low prevailing interest rate environment.

             Future interest rates or their effect on net portfolio value or net interest income are not predictable. Computations of prospective effects of hypothetical interest rate changes are based on numerous assumptions, including relative levels of market interest rates, prepayments, and deposit run-offs, and should not be relied upon as indicative of actual results. Certain shortcomings are inherent in this type of computation. 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 rate on certain types of assets and liabilities such as demand deposits and savings accounts, 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 adjustable rate mortgages generally have features, which restrict changes in interest rates on a short-term basis and over the life of the asset. 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 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.

             Notwithstanding the discussion above, the qualitative interest rate analysis findings presented herein indicate that further increases in interest rates would continue to adversely affect our net interest margin and earnings. Management is continuing to evaluate and implement a variety of strategies to manage the earnings risks presented by the continued upward movement in interest rates and flattening of the yield curve. The most significant of these are the Company's lending diversification and growth strategies complemented by strategies focused on growing core deposits. Such deposit strategies highlight both retail branch expansion as well as enhancing business banking products and services.

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              Additionally, the Company expects to continue the sale of longer-term, fixed rate conforming loan originations into the secondary market while evaluating greater use of the secondary markets for selling other conforming and non-conforming 1-4 family mortgage loan originations. For the quarter ended March 31, 2006, we sold a total of $1.9 million of loans to the Federal National Mortgage Association which resulted in gains on sales of mortgage loans held for sale of $6,000. Because we offer borrowers the option to lock in their interest rate prior to closing their mortgage loans, we may be exposed to market risk on the loans we sell into the secondary market. Once a loan's rate is locked, the price at which we can sell the loan will vary with movements in market interest rates. To manage that risk, we may take forward commitments to sell loans at a fixed price. At March 31, 2006, the Bank had two outstanding contracts to sell long term, fixed rate mortgage loans totaling $694,000 to the Federal National Mortgage Association. Loans sold under contracts drawn in the future may generate additional gains or losses on sale of mortgage loans in subsequent periods.

              Finally, during fiscal 2004 we recognized a $125,000 penalty to prepay $3.0 million of fixed rate FHLB advances with a weighted average cost of 6.28%.  Although no such prepayments were transacted in fiscal 2005 or during the six months ended March 31, 2006 we may evaluate the costs and benefits of further prepayments, which may result in additional one-time charges to earnings in the form of FHLB prepayment penalties to further improve the Bank's net interest spread and margin and enhance future earnings.

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ITEM 4. CONTROLS AND PROCEDURES

(a)

Evaluation of disclosure controls and procedures: An evaluation of the Company's disclosure controls and procedures (as defined in Section 13(a)-15(e) of the Securities Exchange Act of 1934 ("the Act") was carried out under the supervision and with the participation of the Company's Chief Executive Officer, Chief Financial Officer and several other members of the Company's senior management. Based on such evaluation, the Company's Chief Executive Officer and Chief Financial Officer concluded that the Company's disclosure controls and procedures in effect as of the end of the period covered by this quarterly report are effective in ensuring that the information required to be disclosed by the Company in the reports it files or submits under the Act is (i) accumulated and communicated to the Company's management (including the Chief Executive Officer and Chief Financial Officer) in a timely manner, and (ii) recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms.

(b)

Changes in internal controls: In the quarter ended March 31, 2006, there was no change in the Company's internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

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PART II - - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

              At March 31, 2006, the Company and its subsidiaries were not involved in any pending proceedings other than the legal proceedings occurring in the ordinary course of business. Such legal proceedings in the aggregate are believed by management to be immaterial to the Company's financial condition and results of operations.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

              None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

              None

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

              None

ITEM 5. OTHER INFORMATION

              None

ITEM 6. EXHIBITS

(a)	Exhibits
	10.2	Amended Emloyment Agreement between American Bank of New Jersey and Richard M. Bzdek
	10.3	Amended Employment Agreement between American Bank of New Jersey and Eric B. Heyer
	10.6	Amended Employment Agreement between American Bank of New Jersey and Catherine M. Bringuier
	31.1	Certification of Chief Executive Officer Pursuant to Rule 13a-14a and 15d-14a.
	31.2	Certification of Chief Financial Officer Pursuant to Rule 13a-14a and 15d-14a.
	32	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	American Bancorp of New Jersey, Inc.     (Registrant)
Date:     May 15, 2006	/s/ Joseph KliminskiJoseph Kliminski Chief Executive Officer
Date:     May 15, 2006	/s/ Eric B. HeyerEric B. Heyer Senior Vice President and Chief Financial Officer

 







 







40 End.

EX-10.2

EXHIBIT 10.2

EMPLOYMENT AGREEMENT
As Amended and Restated
            THIS AGREEMENT, is entered into this 1st day of January 2006, ("Effective Date") by and between American Bank of New Jersey (the "Savings Bank") and Richard M. Bzdek (the "Executive").
WITNESSETH
            WHEREAS, the Executive has heretofore been employed by the Savings Bank as the Executive Vice President and is experienced in all phases of the business of the Savings Bank; and

            WHEREAS, the parties have previously entered into an Employment Agreement, dated January 1, 2003, ("Prior Agreement"); and

            WHEREAS, the Savings Bank wishes to be assured of the Executive's continued active participation in the business of the Savings Bank and wishes to make certain revisions to such Prior Agreement.

            NOW, THEREFORE, in consideration of the covenants and the mutual agreements herein contained, the parties hereby agree as follows:

            1.             Employment. The Savings Bank hereby employs the Executive in the capacity of Executive Vice President. The Executive hereby accepts said employment and agrees to render such administrative and management services to the Savings Bank and American Bancorp of New Jersey, Inc., the parent holding company of the Savings Bank ("Parent") as are currently rendered and as are customarily performed by persons situated in a similar executive capacity. The Executive shall promote the business of the Savings Bank and Parent. The Executive's other duties shall be such as the Board of Directors for the Savings Bank (the "Board of Directors" or "Board") may from time to time reasonably direct, including normal duties as an officer of the Savings Bank.

            2.             Term of Agreement. The term of this Agreement shall be for the period commencing on the Effective Date and ending December 31, 2006 thereafter ("Term"). Additionally, on, or before, each annual anniversary date from the Effective Date, the Term of this Agreement shall be extended for up to an additional one year period beyond the then effective expiration date upon a determination and resolution of the Board of Directors that the performance of the Executive has met the requirements and standards of the Board, and that the Term of such Agreement shall be extended. References herein to the Term of this Agreement shall refer both to the initial term and successive terms.

            3.             Compensation, Benefits and Expenses.

                            (a)             Base Salary. The Savings Bank shall compensate and pay the Executive during the Term of this Agreement a minimum base salary at the rate

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of $169,892 per annum ("Base Salary"), payable in cash not less frequently than monthly; provided, that the rate of such salary shall be reviewed by the Board of Directors not less often than annually, and the Executive shall be entitled to receive increases at such percentages or in such amounts as determined by the Board of Directors.

                            (b)             Discretionary Bonus. The Executive shall be entitled to participate in an equitable manner with all other senior management employees of the Savings Bank in discretionary bonuses that may be authorized and declared by the Board of Directors to its senior management executives from time to time. No other compensation provided for in this Agreement shall be deemed a substitute for the Executive's right to participate in such discretionary bonuses when and as declared by the Board.

                            (c)             Participation in Benefit and Retirement Plans. The Executive shall be entitled to participate in and receive the benefits of any plan of the Savings Bank or its Parent which may be or may become applicable to senior management relating to pension or other retirement benefit plans, profit-sharing, stock options or incentive plans, or other plans, benefits and privileges given to employees and executives of the Savings Bank or its Parent, to the extent commensurate with his then duties and responsibilities, as fixed by the Board of Directors of the Savings Bank or its Parent.

                            (d)             Participation in Medical Plans and Insurance Policies. The Executive shall be entitled to participate in and receive the benefits of any plan or policy of the Savings Bank which may be or may become applicable to senior management relating to life insurance, short and long term disability, medical, dental, eye-care, prescription drugs or medical reimbursement plans. Additionally, Executive's dependent family shall be eligible to participate in medical and dental insurance plans sponsored by the Savings Bank or Parent with 70% of the cost of such premiums paid by the Savings Bank.

                            (e)             Vacations and Sick Leave. The Executive shall be entitled to paid annual vacation leave in accordance with the policies as established from time to time by the Board of Directors. The Executive shall also be entitled to an annual sick leave benefit as established by the Board for senior management employees of the Savings Bank. The Executive shall not be entitled to receive any additional compensation from the Savings Bank for failure to take a vacation or sick leave, nor shall he be able to accumulate unused vacation or sick leave from one year to the next, except to the extent authorized by the Board of Directors.

                            (f)             Expenses. The Savings Bank shall reimburse the Executive or otherwise provide for or pay for all reasonable expenses incurred by the Executive in furtherance of, or in connection with the business of the Savings Bank or Parent, including, but not by way of limitation, automobile and traveling expenses, and all reasonable entertainment expenses, subject to such reasonable documentation and other limitations as may be established by the Board of Directors of the Savings Bank. If such expenses are paid in the first instance by the Executive, the Savings Bank shall reimburse the Executive therefor. Expenses incurred by Executive on behalf of Parent shall be paid or advanced by Parent or reimbursed by Parent to the Savings Bank.

                            (g)             Changes in Benefits. The Savings Bank shall not make any changes in such plans, benefits or privileges previously described in Section 3(c), (d) and (e) which would adversely affect the Executive's rights or benefits thereunder, unless such change occurs pursuant to a program applicable to all executive officers of the Savings Bank and does not result in a

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proportionately greater adverse change in the rights of, or benefits to, the Executive as compared with any other executive officer of the Savings Bank. Nothing paid to Executive under any plan or arrangement presently in effect or made available in the future shall be deemed to be in lieu of the salary payable to Executive pursuant to Section 3(a) hereof.

            4.             Loyalty; Noncompetition.

                            (a)             The Executive shall devote his full time and attention to the performance of his employment under this Agreement. During the term of the Executive's employment under this Agreement, the Executive shall not engage in any business or activity contrary to the business affairs or interests of the Savings Bank or Parent.

                            (b)             Nothing contained in this Section 4 shall be deemed to prevent or limit the right of Executive to invest in the capital stock or other securities of any business dissimilar from that of the Savings Bank or Parent, or, solely as a passive or minority investor, in any business.

             5.             Standards. During the term of this Agreement, the Executive shall perform his duties in accordance with such reasonable standards expected of executives with comparable positions in comparable organizations and as may be established from time to time by the Board of Directors.

             6.             Termination and Termination Pay. The Executive's employment under this Agreement shall be terminated upon any of the following occurrences:

                            (a)             The death of the Executive during the term of this Agreement, in which event the Executive's estate shall be entitled to receive the compensation due the Executive through the last day of the calendar month in which Executive's death shall have occurred.

                            (b)             The Savings Bank may terminate the Executive's employment at any time with or without Just Cause within its sole discretion. This Agreement shall not be deemed to give Executive any right to be retained in the employment or service of the Savings Bank, or to interfere with the right of the Savings Bank to terminate the employment of the Executive at any time, but any termination by the Savings Bank other than termination for Just Cause shall not prejudice the Executive's right to compensation or other benefits under the Agreement. The Executive shall have no right to receive compensation or other benefits for any period after termination for Just Cause. The Savings Bank may within its sole discretion, acting in good faith, terminate the Executive for Just Cause and sha ll notify such Executive accordingly. Termination for "Just Cause" shall include termination because of the Executive'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, or material breach of any provision of the Agreement.

                            (c)             Except as provided pursuant to Section 9 hereof, in the event Executive's employment under this Agreement is terminated by the Savings Bank without Just Cause during the Term of this Agreement (including any renewal Term), the Savings Bank shall be obligated to continue to pay the Executive: i) the salary provided pursuant to Section 3(a) herein, up to the date of termination of the remaining Term of this Agreement, but in no event for a period of more than

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nine calendar months nor less than a period of six calendar months from such date of termination of employment; and ii) for the same six to nine month period, the cost of Executive obtaining all health, life and disability benefits which the Executive would be eligible to participate in during such period of payment based upon the benefit levels substantially equal to those being provided Executive at the date of termination of employment. The provisions of this Section 6(c) shall survive the expiration of this Agreement.

                            (d)             The voluntary termination by the Executive during the term of this Agreement with the delivery of no less than 60 days written notice to the Board of Directors, other than pursuant to Section 9(b), in which case the Executive shall be entitled to receive only the compensation, vested rights, and all employee benefits up to the date of such termination.

            7.             Regulatory Exclusions.

                            (a)             If the Executive is suspended and/or temporarily prohibited from participating in the conduct of the Savings Bank's affairs by a notice served under Section 8(e)(3) or (g)(1) of the FDIA (12 U.S.C. 1818(e)(3) and (g)(1)), the Savings Bank's obligations under the Agreement shall be suspended as of the date of service, unless stayed by appropriate proceedings. If the charges in the notice are dismissed, the Savings Bank may within its discretion (i) pay the Executive all or part of the compensation withheld while its contract obligations were suspended and (ii) reinstate any of its obligations which were suspended.

                            (b)             If the Executive is removed and/or permanently prohibited from participating in the conduct of the Savings 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) and (g)(1)), all obligations of the Savings Bank under this Agreement shall terminate, as of the effective date of the order, but the vested rights of the parties shall not be affected.

                            (c)             If the Savings Bank is in default (as defined in Section 3(x)(1) of FDIA) all obligations under this Agreement shall terminate as of the date of default, but this paragraph shall not affect any vested rights of the contracting parties.

                            (d)             All obligations under this Agreement shall be terminated, except to the extent determined that continuation of this Agreement is necessary for the continued operation of the Savings Bank: (i) by the Director of the Office of Thrift Supervision ("Director of OTS"), or his designee, at the time that the Federal Deposit Insurance Corporation ("FDIC") enters into an agreement to provide assistance to or on behalf of the Savings Bank under the authority contained in Section 13(c) of FDIA; or (ii) by the Director of the OTS, or his designee, at the time that the Director of the OTS, or his designee approves a supervisory merger to resolve problems related to operation of the Savings Bank or when the Savings Bank is determined by the Director of the OTS to be in an unsafe or unsound condition. Any rights of the parties that have already vested, however, shall not be affected by such action.

                            (e)             Notwithstanding anything herein to the contrary, any payments made to the Executive pursuant to the Agreement, or otherwise, shall be subject to and conditioned upon compliance with 12 USC '1828(k) and any regulations promulgated thereunder.

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            8.             Disability. If the Executive shall become disabled or incapacitated to the extent that he is unable to perform his duties hereunder, by reason of medically determinable physical or mental impairment, as determined by a doctor engaged by the Board of Directors, Executive shall receive compensation and benefits in accordance with the terms of any plans or policies of the Savings Bank relating to short and long term disability, rather than pursuant to the Agreement. Such benefits shall be reduced by any benefits otherwise provided to the Executive during such period under the provisions of disability insurance coverage in effect for Savings Bank employees. Upon returning to active full-time employment, the Executive's full compensation as set forth in this Agreement shall be reinstated as of the date of commencement of such activities. In the event that the Executive returns to active employment on other than a full-time basis, then his compensation (as set forth in Section 3(a) of this Agreement) shall be reduced in proportion to the time spent in said employment, or as shall otherwise be agreed to by the parties.

            9.             Change in Control.

                             (a)             Notwithstanding any provision herein to the contrary, in the event of the involuntary termination of Executive's employment during the term of this Agreement following any Change in Control of the Savings Bank or Parent, or within twelve (12) months thereafter of such Change in Control, absent Just Cause, Executive shall be paid an amount equal to the product of two (2) times the Executive's "base amount" as defined in Section 280G(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code") and regulations promulgated thereunder. Said sum shall be paid in one (1) lump sum as of the date of such termination of service, and such payments shall be in lieu of any other future payments which the Executive would be otherwise entitled to receive under Section 6 of t his Agreement. Notwithstanding the forgoing, all sums payable hereunder shall be reduced in such manner and to such extent so that no such payments made hereunder, when aggregated with all other payments to be made to the Executive by the Savings Bank or the Parent, shall be deemed an "excess parachute payment" in accordance with Section 280G of the Code and be subject to the excise tax provided at Section 4999(a) of the Code. The term "Change in Control" shall refer to: (i) the sale of all, or a material portion, of the assets of the Savings Bank or the Parent; (ii) the merger or recapitalization of the Savings Bank or the Parent whereby the Savings Bank or the Parent is not the surviving entity; (iii) a change in control of the Savings Bank or the Parent, as otherwise defined or determined by the Office of Thrift Supervision or regulations promulgated by it; or (iv) the acquisition, directly or indirectly, of the beneficial ownership (within the meaning of that term as it is used in Section 13(d) of the Se curities Exchange Act of 1934 and the rules and regulations promulgated thereunder) of twenty-five percent (25%) or more of the outstanding voting securities of the Savings Bank or the Parent by any person, trust, entity or group. The term "person" means an individual other than the Executive, or a corporation, partnership, trust, association, joint venture, pool, syndicate, sole proprietorship, unincorporated organization or any other form of entity not specifically listed herein. The provisions of this Section 9(a) shall survive the expiration of this Agreement occurring after a Change in Control.

                             (b)             Notwithstanding any other provision of this Agreement to the contrary, Executive may voluntarily terminate his employment during the term of this Agreement following a Change in Control of the Savings Bank or Parent, or within twelve (12) months following such Change in Control, and upon the occurrence, or within 120 days thereafter, of any of the following events, which have not been consented to in advance by the Executive in writing: (i) if Executive would be required to move his personal residence or perform his principal executive functions more than forty (40) miles from the Executive's primary office as of the signing of this Agreement; or (ii) if the Savings Bank should fail to maintain Executive's base compensation in effect as of the

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date of the Change in Control and the existing employee benefits plans, including material fringe and retirement plans. Upon such voluntary termination of employment by the Executive in accordance with this subsection, Executive shall thereupon be entitled to receive the payments described in Section 9(a) of this Agreement. The provisions of this Section 9(b) shall survive the expiration of this Agreement occurring after a Change in Control.

            10.             Withholding. All payments required to be made by the Savings Bank hereunder to the Executive shall be subject to the withholding of such amounts, if any, relating to tax and other payroll deductions as the Savings Bank may reasonably determine should be withheld pursuant to any applicable law or regulation.

            11.             Successors and Assigns.

                              (a)             This Agreement shall inure to the benefit of and be binding upon any corporate or other successor of the Savings Bank or Parent which shall acquire, directly or indirectly, by merger, consolidation, purchase or otherwise, all or substantially all of the assets or stock of the Savings Bank or Parent.

                              (b)             Since the Savings Bank is contracting for the unique and personal skills of the Executive, the Executive shall be precluded from assigning or delegating his rights or duties hereunder without first obtaining the written consent of the Savings Bank.

            12.             Amendment; Waiver. No provisions of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing, signed by the Executive and such officer or officers as may be specifically designated by the Board of Directors of the Savings Bank to sign on its behalf. No waiver by any party hereto at any time of any breach by any other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

            13.             Governing Law. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the United States where applicable and otherwise by the substantive laws of the State of New Jersey.

            14.             Nature of Obligations. Nothing contained herein shall create or require the Savings Bank to create a trust of any kind to fund any benefits which may be payable hereunder, and to the extent that the Executive acquires a right to receive benefits from the Savings Bank hereunder, such right shall be no greater than the right of any unsecured general creditor of the Savings Bank.

            15.             Headings. The section headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

            16.             Severability. The provisions of this Agreement shall be deemed severable and the invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of the other provisions of this Agreement, which shall remain in full force and effect.

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            17.             Arbitration. Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be settled exclusively by arbitration in accordance with the rules then in effect of the district office of the American Arbitration Association ("AAA") nearest to the home office of the Savings Bank, and judgment upon the award rendered may be entered in any court having jurisdiction thereof, except to the extent that the parties may otherwise reach a mutual settlement of such issue. The provisions of this Section 17 shall survive the expiration of this Agreement.

            18.             Confidential Information. The Executive acknowledges that during his employment he will learn and have access to confidential information regarding the Savings Bank and the Parent and its customers and businesses ("Confidential Information"). The Executive agrees and covenants not to disclose or use for his own benefit, or the benefit of any other person or entity, any such Confidential Information, unless or until the Savings Bank or the Parent consents to such disclosure or use or such information becomes common knowledge in the industry or is otherwise legally in the public domain. The Executive shall not knowingly disclose or reveal to any unauthorized person any Confidential Information relating to the Savings Bank, the Parent, or any subsidiaries or affiliates, or to any of the businesses operated by them, and the Executive confirms that such information constitutes the exclusive property of the Savings Bank and the Parent. The Executive shall not otherwise knowingly act or conduct himself (a) to the material detriment of the Savings Bank or the Parent, or its subsidiaries, or affiliates, or (b) in a manner which is inimical or contrary to the interests of the Savings Bank or the Parent. Notwithstanding anything herein to the contrary, failure by the Executive to comply with the provisions of this Section may result in the immediate termination of the Agreement within the sole discretion of the Savings Bank, disciplinary action against the Executive taken by the Savings Bank, including but not limited to the termination of employment of the Executive for breach of the Agreement and the provisions of this Section, and other remedies that may be available in law or in equity.

            19.             Compliance with Section 409A of the Code. Not withstanding anything herein to the contrary, any payments to be made in accordance with Sections 6 or 9 of the Agreement shall not be made prior to the date that is 183 calendar days from the date of termination of employment of the Executive if it is determined by the Savings Bank or the Parent in good faith that such payments to be made to such Executive are subject to the limitations set forth at Section 409A of the Code and regulations promulgated thereunder, and payments made in advance of such date would result in the requirement for the Executive to pay additional interest and taxes to be imposed in accordance with Section 409A(a)(1)(B) of the Code.

            20.             Entire Agreement. This Agreement together with any understanding or modifications thereof as agreed to in writing by the parties, shall constitute the entire agreement between the parties hereto.

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            IN WITNESS WHEREOF, the parties have executed this Agreement on the date first hereinabove written.

	AMERICAN BANK OF NEW JERSEY
	By:	/s/ W. George Parker W. George Parker Chairman
ATTEST:       /s/ Kathleen Walsh Sectretary (Asst.)

WITNESS:
/s/ Rocketta Couzzi	/s/ Richard M. Bzdek Richard M. Bzdek Executive

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End.

EX-10.3

EXHIBIT 10.3

EMPLOYMENT AGREEMENT
As Amended and Restated
            THIS AGREEMENT, is entered into this 1st day of January 2006, ("Effective Date") by and between American Bank of New Jersey (the "Savings Bank") and Eric B. Heyer (the "Executive").
WITNESSETH
            WHEREAS, the Executive has heretofore been employed by the Savings Bank as the Senior Vice President and Chief Financial Officer and is experienced in all phases of the business of the Savings Bank; and

            WHEREAS, the parties have previously entered into an Employment Agreement, dated January 1, 2003, ("Prior Agreement"); and

            WHEREAS, the Savings Bank wishes to be assured of the Executive's continued active participation in the business of the Savings Bank and wishes to make certain revisions to such Prior Agreement.

            NOW, THEREFORE, in consideration of the covenants and the mutual agreements herein contained, the parties hereby agree as follows:

            1.        Employment. The Savings Bank hereby employs the Executive in the capacity of Senior Vice President and Chief Financial Officer. The Executive hereby accepts said employment and agrees to render such administrative and management services to the Savings Bank and American Bancorp of New Jersey, Inc. the parent holding company of the Savings Bank ("Parent") as are currently rendered and as are customarily performed by persons situated in a similar executive capacity. The Executive shall promote the business of the Savings Bank and Parent. The Executive's other duties shall be such as the Board of Directors for the Savings Bank (the "Board of Directors" or "Board") may from time to time reasonably direct, including normal duties as an officer of the Savings Bank.

            2.        Term of Agreement. The term of this Agreement shall be for the period commencing on the Effective Date and ending December 31, 2006 thereafter ("Term"). Additionally, on, or before, each annual anniversary date from the Effective Date, the Term of this Agreement shall be extended for up to an additional one year period beyond the then effective expiration date upon a determination and resolution of the Board of Directors that the performance of the Executive has met the requirements and standards of the Board, and that the Term of such Agreement shall be extended. References herein to the Term of this Agreement shall refer both to the initial term and successive terms.

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            3.         Compensation, Benefits and Expenses.

                         (a)        Base Salary. The Savings Bank shall compensate and pay the Executive during the Term of this Agreement a minimum base salary at the rate of $155,327 per annum ("Base Salary"), payable in cash not less frequently than monthly; provided, that the rate of such salary shall be reviewed by the Board of Directors not less often than annually, and the Executive shall be entitled to receive increases at such percentages or in such amounts as determined by the Board of Directors.

                         (b)        Discretionary Bonus. The Executive shall be entitled to participate in an equitable manner with all other senior management employees of the Savings Bank in discretionary bonuses that may be authorized and declared by the Board of Directors to its senior management executives from time to time. No other compensation provided for in this Agreement shall be deemed a substitute for the Executive's right to participate in such discretionary bonuses when and as declared by the Board.

                         (c)        Participation in Benefit and Retirement Plans. The Executive shall be entitled to participate in and receive the benefits of any plan of the Savings Bank or its Parent which may be or may become applicable to senior management relating to pension or other retirement benefit plans, profit-sharing, stock options or incentive plans, or other plans, benefits and privileges given to employees and executives of the Savings Bank or its Parent, to the extent commensurate with his then duties and responsibilities, as fixed by the Board of Directors of the Savings Bank or its Parent.

                         (d)        Participation in Medical Plans and Insurance Policies. The Executive shall be entitled to participate in and receive the benefits of any plan or policy of the Savings Bank which may be or may become applicable to senior management relating to life insurance, short and long term disability, medical, dental, eye-care, prescription drugs or medical reimbursement plans. Additionally, Executive's dependent family shall be eligible to participate in medical and dental insurance plans sponsored by the Savings Bank or Parent with 70% of the cost of such premiums paid by the Savings Bank.

                         (e)        Vacations and Sick Leave. The Executive shall be entitled to paid annual vacation leave in accordance with the policies as established from time to time by the Board of Directors. The Executive shall also be entitled to an annual sick leave benefit as established by the Board for senior management employees of the Savings Bank. The Executive shall not be entitled to receive any additional compensation from the Savings Bank for failure to take a vacation or sick leave, nor shall he be able to accumulate unused vacation or sick leave from one year to the next, except to the extent authorized by the Board of Directors.

                         (f)        Expenses. The Savings Bank shall reimburse the Executive or otherwise provide for or pay for all reasonable expenses incurred by the Executive in furtherance of, or in connection with the business of the Savings Bank or Parent, including, but not by way of limitation, automobile and traveling expenses, and all reasonable entertainment expenses, subject to such reasonable documentation and other limitations as may be established by the Board of Directors of the Savings Bank. If such expenses are paid in the first instance by the Executive, the Savings Bank shall reimburse the Executive therefor. Expenses incurred by Executive on behalf of Parent shall be paid or advanced by Parent or reimbursed by Parent to the Savings Bank.

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                         (g)        Changes in Benefits. The Savings Bank shall not make any changes in such plans, benefits or privileges previously described in Section 3(c), (d) and (e) which would adversely affect the Executive's rights or benefits thereunder, unless such change occurs pursuant to a program applicable to all executive officers of the Savings Bank and does not result in a proportionately greater adverse change in the rights of, or benefits to, the Executive as compared with any other executive officer of the Savings Bank. Nothing paid to Executive under any plan or arrangement presently in effect or made available in the future shall be deemed to be in lieu of the salary payable to Executive pursuant to Section 3(a) hereof.

            4.          Loyalty; Noncompetition.

                         (a)        The Executive shall devote his full time and attention to the performance of his employment under this Agreement. During the term of the Executive's employment under this Agreement, the Executive shall not engage in any business or activity contrary to the business affairs or interests of the Savings Bank or Parent.

                         (b)        Nothing contained in this Section 4 shall be deemed to prevent or limit the right of Executive to invest in the capital stock or other securities of any business dissimilar from that of the Savings Bank or Parent, or, solely as a passive or minority investor, in any business.

             5.          Standards. During the term of this Agreement, the Executive shall perform his duties in accordance with such reasonable standards expected of executives with comparable positions in comparable organizations and as may be established from time to time by the Board of Directors.

             6.         Termination and Termination Pay. The Executive's employment under this Agreement shall be terminated upon any of the following occurrences:

                         (a)        The death of the Executive during the term of this Agreement, in which event the Executive's estate shall be entitled to receive the compensation due the Executive through the last day of the calendar month in which Executive's death shall have occurred.

                         (b)        The Savings Bank may terminate the Executive's employment at any time with or without Just Cause within its sole discretion. This Agreement shall not be deemed to give Executive any right to be retained in the employment or service of the Savings Bank, or to interfere with the right of the Savings Bank to terminate the employment of the Executive at any time, but any termination by the Savings Bank other than termination for Just Cause shall not prejudice the Executive's right to compensation or other benefits under the Agreement. The Executive shall have no right to receive compensation or other benefits for any period after termination for Just Cause. The Savings Bank may within its sole discretion, acting in good faith, terminate the Executive for Just Cause and shall notify such Executive accordingly. Terminatio n for "Just Cause" shall include termination because of the Executive'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, or material breach of any provision of the Agreement.

                         (c)        Except as provided pursuant to Section 9 hereof, in the event Executive's employment under this Agreement is terminated by the Savings Bank without Just Cause during

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the Term of this Agreement (including any renewal Term), the Savings Bank shall be obligated to continue to pay the Executive: i) the salary provided pursuant to Section 3(a) herein, up to the date of termination of the remaining Term of this Agreement, but in no event for a period of less than one year from such date of termination of employment; and ii) for the same minimum one year period, the cost of Executive obtaining all health, life, disability and other benefits which the Executive would be eligible to participate in during such period of payment, based upon the benefit levels substantially equal to those being provided Executive at the date of termination of employment. The provisions of this Section 6(c) shall survive the expiration of this Agreement.

                         (d)        The voluntary termination by the Executive during the term of this Agreement with the delivery of no less than 60 days written notice to the Board of Directors, other than pursuant to Section 9(b), in which case the Executive shall be entitled to receive only the compensation, vested rights, and all employee benefits up to the date of such termination.

             7.         Regulatory Exclusions.

                         (a)        If the Executive is suspended and/or temporarily prohibited from participating in the conduct of the Savings Bank's affairs by a notice served under Section 8(e)(3) or (g)(1) of the FDIA (12 U.S.C. 1818(e)(3) and (g)(1)), the Savings Bank's obligations under the Agreement shall be suspended as of the date of service, unless stayed by appropriate proceedings. If the charges in the notice are dismissed, the Savings Bank may within its discretion (i) pay the Executive all or part of the compensation withheld while its contract obligations were suspended and (ii) reinstate any of its obligations which were suspended.

                         (b)        If the Executive is removed and/or permanently prohibited from participating in the conduct of the Savings 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) and (g)(1)), all obligations of the Savings Bank under this Agreement shall terminate, as of the effective date of the order, but the vested rights of the parties shall not be affected.

                         (c)        If the Savings Bank is in default (as defined in Section 3(x)(1) of FDIA) all obligations under this Agreement shall terminate as of the date of default, but this paragraph shall not affect any vested rights of the contracting parties.

                         (d)        All obligations under this Agreement shall be terminated, except to the extent determined that continuation of this Agreement is necessary for the continued operation of the Savings Bank: (i) by the Director of the Office of Thrift Supervision ("Director of OTS"), or his designee, at the time that the Federal Deposit Insurance Corporation ("FDIC") enters into an agreement to provide assistance to or on behalf of the Savings Bank under the authority contained in Section 13(c) of FDIA; or (ii) by the Director of the OTS, or his designee, at the time that the Director of the OTS, or his designee approves a supervisory merger to resolve problems related to operation of the Savings Bank or when the Savings Bank is determined by the Director of the OTS to be in an unsafe or unsound condition. Any rights of the parties tha t have already vested, however, shall not be affected by such action.

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                         (e)        Notwithstanding anything herein to the contrary, any payments made to the Executive pursuant to the Agreement, or otherwise, shall be subject to and conditioned upon compliance with 12 USC 1828(k) and any regulations promulgated thereunder.

             8.         Disability. If the Executive shall become disabled or incapacitated to the extent that he is unable to perform his duties hereunder, by reason of medically determinable physical or mental impairment, as determined by a doctor engaged by the Board of Directors, Executive shall receive compensation and benefits in accordance with the terms of any plans or policies of the Savings Bank relating to short and long term disability, rather than pursuant to the Agreement. Such benefits shall be reduced by any benefits otherwise provided to the Executive during such period under the provisions of disability insurance coverage in effect for Savings Bank employees. Upon returning to active full-time employment, the Executive's full compensation as set forth in this Agreement shall be reinstated as of the date of commencement of such activities. In the event that the Executive returns to active employment on other than a full-time basis, then his compensation (as set forth in Section 3(a) of this Agreement) shall be reduced in proportion to the time spent in said employment, or as shall otherwise be agreed to by the parties.

             9.         Change in Control.

                         (a)        Notwithstanding any provision herein to the contrary, in the event of the involuntary termination of Executive's employment during the term of this Agreement following any Change in Control of the Savings Bank or Parent, or within twelve (12) months thereafter of such Change in Control, absent Just Cause, Executive shall be paid an amount equal to the product of two (2) times the Executive's "base amount" as defined in Section 280G(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code") and regulations promulgated thereunder. Said sum shall be paid in one (1) lump sum as of the date of such termination of service, and such payments shall be in lieu of any other future payments which the Executive would be otherwise entitled to receive under Section 6 of this Agreement. Notwithstanding the forgoing, all s ums payable hereunder shall be reduced in such manner and to such extent so that no such payments made hereunder, when aggregated with all other payments to be made to the Executive by the Savings Bank or the Parent, shall be deemed an "excess parachute payment" in accordance with Section 280G of the Code and be subject to the excise tax provided at Section 4999(a) of the Code. The term "Change in Control" shall refer to: (i) the sale of all, or a material portion, of the assets of the Savings Bank or the Parent; (ii) the merger or recapitalization of the Savings Bank or the Parent whereby the Savings Bank or the Parent is not the surviving entity; (iii) a change in control of the Savings Bank or the Parent, as otherwise defined or determined by the Office of Thrift Supervision or regulations promulgated by it; or (iv) the acquisition, directly or indirectly, of the beneficial ownership (within the meaning of that term as it is used in Section 13(d) of the Securities Exchange Act of 1934 and the rules and re gulations promulgated thereunder) of twenty-five percent (25%) or more of the outstanding voting securities of the Savings Bank or the Parent by any person, trust, entity or group. The term "person" means an individual other than the Executive, or a corporation, partnership, trust, association, joint venture, pool, syndicate, sole proprietorship, unincorporated organization or any other form of entity not specifically listed herein. The provisions of this Section 9(a) shall survive the expiration of this Agreement occurring after a Change in Control.

                         (b)        Notwithstanding any other provision of this Agreement to the contrary, Executive may voluntarily terminate his employment during the term of this Agreement following a Change in Control of the Savings Bank or Parent, or within twelve (12) months following such Change in Control, and upon the occurrence, or within 120 days thereafter, of any of the following events, which have not been consented to in advance by the Executive in writing: (i) if Executive

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would be required to move his personal residence or perform his principal executive functions more than forty (40) miles from the Executive's primary office as of the signing of this Agreement; or (ii) if the Savings Bank should fail to maintain Executive's base compensation in effect as of the date of the Change in Control and the existing employee benefits plans, including material fringe and retirement plans. Upon such voluntary termination of employment by the Executive in accordance with this subsection, Executive shall thereupon be entitled to receive the payments described in Section 9(a) of this Agreement. The provisions of this Section 9(b) shall survive the expiration of this Agreement occurring after a Change in Control.

             10.       Withholding. All payments required to be made by the Savings Bank hereunder to the Executive shall be subject to the withholding of such amounts, if any, relating to tax and other payroll deductions as the Savings Bank may reasonably determine should be withheld pursuant to any applicable law or regulation.

             11.       Successors and Assigns.

                         (a)        This Agreement shall inure to the benefit of and be binding upon any corporate or other successor of the Savings Bank or Parent which shall acquire, directly or indirectly, by merger, consolidation, purchase or otherwise, all or substantially all of the assets or stock of the Savings Bank or Parent.

                         (b)        Since the Savings Bank is contracting for the unique and personal skills of the Executive, the Executive shall be precluded from assigning or delegating his rights or duties hereunder without first obtaining the written consent of the Savings Bank.

             12.       Amendment; Waiver. No provisions of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing, signed by the Executive and such officer or officers as may be specifically designated by the Board of Directors of the Savings Bank to sign on its behalf. No waiver by any party hereto at any time of any breach by any other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

             13.       Governing Law. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the United States where applicable and otherwise by the substantive laws of the State of New Jersey.

             14.       Nature of Obligations. Nothing contained herein shall create or require the Savings Bank to create a trust of any kind to fund any benefits which may be payable hereunder, and to the extent that the Executive acquires a right to receive benefits from the Savings Bank hereunder, such right shall be no greater than the right of any unsecured general creditor of the Savings Bank.

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             15.        Headings. The section headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

             16.       Severability. The provisions of this Agreement shall be deemed severable and the invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of the other provisions of this Agreement, which shall remain in full force and effect.

             17.       Arbitration. Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be settled exclusively by arbitration in accordance with the rules then in effect of the district office of the American Arbitration Association ("AAA") nearest to the home office of the Savings Bank, and judgment upon the award rendered may be entered in any court having jurisdiction thereof, except to the extent that the parties may otherwise reach a mutual settlement of such issue. The provisions of this Section 17 shall survive the expiration of this Agreement.

             18.       Confidential Information. The Executive acknowledges that during his employment he will learn and have access to confidential information regarding the Savings Bank and the Parent and its customers and businesses ("Confidential Information"). The Executive agrees and covenants not to disclose or use for his own benefit, or the benefit of any other person or entity, any such Confidential Information, unless or until the Savings Bank or the Parent consents to such disclosure or use or such information becomes common knowledge in the industry or is otherwise legally in the public domain. The Executive shall not knowingly disclose or reveal to any unauthorized person any Confidential Information relating to the Savings Bank, the Parent, or any subsidiaries or affiliates, or to any of the businesses operated by them, and the Executive confirms that such information constitutes the exclusi ve property of the Savings Bank and the Parent. The Executive shall not otherwise knowingly act or conduct himself (a) to the material detriment of the Savings Bank or the Parent, or its subsidiaries, or affiliates, or (b) in a manner which is inimical or contrary to the interests of the Savings Bank or the Parent. Notwithstanding anything herein to the contrary, failure by the Executive to comply with the provisions of this Section may result in the immediate termination of the Agreement within the sole discretion of the Savings Bank, disciplinary action against the Executive taken by the Savings Bank, including but not limited to the termination of employment of the Executive for breach of the Agreement and the provisions of this Section, and other remedies that may be available in law or in equity.

             19.       Compliance with Section 409A of the Code. Not withstanding anything herein to the contrary, any payments to be made in accordance with Sections 6 or 9 of the Agreement shall not be made prior to the date that is 183 calendar days from the date of termination of employment of the Executive if it is determined by the Savings Bank or the Parent in good faith that such payments to be made to such Executive are subject to the limitations set forth at Section 409A of the Code and regulations promulgated thereunder, and payments made in advance of such date would result in the requirement for the Executive to pay additional interest and taxes to be imposed in accordance with Section 409A(a)(1)(B) of the Code.

             20.       Entire Agreement. This Agreement together with any understanding or modifications thereof as agreed to in writing by the parties, shall constitute the entire agreement between the parties hereto.

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            IN WITNESS WHEREOF, the parties have executed this Agreement on the date first hereinabove written.

	AMERICAN BANK OF NEW JERSEY
	By:	/s/ W. George Parker W. George Parker Chairman
ATTEST:       /s/ Kathleen Walsh Sectretary

WITNESS:
/s/ Kathleen Walsh	/s/ Eric B. Heyer Erick B. Heyer Executive

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End.

EX-10.6

EXHIBIT 10.6

EMPLOYMENT AGREEMENT
As Amended and Restated
            THIS AGREEMENT, is entered into this 1st day of January 2006, ("Effective Date") by and between American Bank of New Jersey (the "Savings Bank") and Catherine M. Bringuier (the "Executive").
WITNESSETH
            WHEREAS, the Executive has heretofore been employed by the Savings Bank as the Senior Vice President and Chief Lending Officer and is experienced in all phases of the business of the Savings Bank; and

            WHEREAS, the parties have previously entered into an Employment Agreement, dated January 1, 2003, ("Prior Agreement"); and

            WHEREAS, the Savings Bank wishes to be assured of the Executive's continued active participation in the business of the Savings Bank and wishes to make certain revisions to such Prior Agreement.

            NOW, THEREFORE, in consideration of the covenants and the mutual agreements herein contained, the parties hereby agree as follows:

            1.        Employment. The Savings Bank hereby employs the Executive in the capacity of Senior Vice President and Chief Lending Officer. The Executive hereby accepts said employment and agrees to render such administrative and management services to the Savings Bank and American Bancorp of New Jersey, Inc. the parent holding company of the Savings Bank ("Parent") as are currently rendered and as are customarily performed by persons situated in a similar executive capacity. The Executive shall promote the business of the Savings Bank and Parent. The Executive's other duties shall be such as the Board of Directors for the Savings Bank (the "Board of Directors" or "Board") may from time to time reasonably direct, including normal duties as an officer of the Savings Bank.

            2.        Term of Agreement. The term of this Agreement shall be for the period commencing on the Effective Date and ending December 31, 2006 thereafter ("Term"). Additionally, on, or before, each annual anniversary date from the Effective Date, the Term of this Agreement shall be extended for up to an additional one year period beyond the then effective expiration date upon a determination and resolution of the Board of Directors that the performance of the Executive has met the requirements and standards of the Board, and that the Term of such Agreement shall be extended. References herein to the Term of this Agreement shall refer both to the initial term and successive terms.

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            3.        Compensation, Benefits and Expenses.

                       (a)        Base Salary. The Savings Bank shall compensate and pay the Executive during the Term of this Agreement a minimum base salary at the rate of $144,130 per annum ("Base Salary"), payable in cash not less frequently than monthly; provided, that the rate of such salary shall be reviewed by the Board of Directors not less often than annually, and the Executive shall be entitled to receive increases at such percentages or in such amounts as determined by the Board of Directors.

                       (b)        Discretionary Bonus. The Executive shall be entitled to participate in an equitable manner with all other senior management employees of the Savings Bank in discretionary bonuses that may be authorized and declared by the Board of Directors to its senior management executives from time to time. No other compensation provided for in this Agreement shall be deemed a substitute for the Executive's right to participate in such discretionary bonuses when and as declared by the Board.

                       (c)        Participation in Benefit and Retirement Plans. The Executive shall be entitled to participate in and receive the benefits of any plan of the Savings Bank or its Parent which may be or may become applicable to senior management relating to pension or other retirement benefit plans, profit-sharing, stock options or incentive plans, or other plans, benefits and privileges given to employees and executives of the Savings Bank or its Parent, to the extent commensurate with her then duties and responsibilities, as fixed by the Board of Directors of the Savings Bank or its Parent.

                       (d)        Participation in Medical Plans and Insurance Policies. The Executive shall be entitled to participate in and receive the benefits of any plan or policy of the Savings Bank which may be or may become applicable to senior management relating to life insurance, short and long term disability, medical, dental, eye-care, prescription drugs or medical reimbursement plans. Additionally, Executive's dependent family shall be eligible to participate in medical and dental insurance plans sponsored by the Savings Bank or Parent with 70% of the cost of such premiums paid by the Savings Bank.

                       (e)        Vacations and Sick Leave. The Executive shall be entitled to paid annual vacation leave in accordance with the policies as established from time to time by the Board of Directors. The Executive shall also be entitled to an annual sick leave benefit as established by the Board for senior management employees of the Savings Bank. The Executive shall not be entitled to receive any additional compensation from the Savings Bank for failure to take a vacation or sick leave, nor shall she be able to accumulate unused vacation or sick leave from one year to the next, except to the extent authorized by the Board of Directors.

                       (f)        Expenses. The Savings Bank shall reimburse the Executive or otherwise provide for or pay for all reasonable expenses incurred by the Executive in furtherance of, or in connection with the business of the Savings Bank or Parent, including, but not by way of limitation, automobile and traveling expenses, and all reasonable entertainment expenses, subject to such reasonable documentation and other limitations as may be established by the Board of Directors of the Savings Bank. If such expenses are paid in the first instance by the Executive, the Savings Bank shall reimburse the Executive therefor. Expenses incurred by Executive on behalf of Parent shall be paid or advanced by Parent or reimbursed by Parent to the Savings Bank.

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                       (g)        Changes in Benefits. The Savings Bank shall not make any changes in such plans, benefits or privileges previously described in Section 3(c), (d) and (e) which would adversely affect the Executive's rights or benefits thereunder, unless such change occurs pursuant to a program applicable to all executive officers of the Savings Bank and does not result in a proportionately greater adverse change in the rights of, or benefits to, the Executive as compared with any other executive officer of the Savings Bank. Nothing paid to Executive under any plan or arrangement presently in effect or made available in the future shall be deemed to be in lieu of the salary payable to Executive pursuant to Section 3(a) hereof.

            4.        Loyalty; Noncompetition.

                       (a)        The Executive shall devote her full time and attention to the performance of her employment under this Agreement. During the term of the Executive's employment under this Agreement, the Executive shall not engage in any business or activity contrary to the business affairs or interests of the Savings Bank or Parent.

                       (b)        Nothing contained in this Section 4 shall be deemed to prevent or limit the right of Executive to invest in the capital stock or other securities of any business dissimilar from that of the Savings Bank or Parent, or, solely as a passive or minority investor, in any business.

            5.        Standards. During the term of this Agreement, the Executive shall perform her duties in accordance with such reasonable standards expected of executives with comparable positions in comparable organizations and as may be established from time to time by the Board of Directors.

            6.        Termination and Termination Pay. The Executive's employment under this Agreement shall be terminated upon any of the following occurrences:

                       (a)        The death of the Executive during the term of this Agreement, in which event the Executive's estate shall be entitled to receive the compensation due the Executive through the last day of the calendar month in which Executive's death shall have occurred.

                       (b)        The Savings Bank may terminate the Executive's employment at any time with or without Just Cause within its sole discretion. This Agreement shall not be deemed to give Executive any right to be retained in the employment or service of the Savings Bank, or to interfere with the right of the Savings Bank to terminate the employment of the Executive at any time, but any termination by the Savings Bank other than termination for Just Cause shall not prejudice the Executive's right to compensation or other benefits under the Agreement. The Executive shall have no right to receive compensation or other benefits for any period after termination for Just Cause. The Savings Bank may within its sole discretion, acting in good faith, terminate the Executive for Just Cause and shall notify such Executive accordingly. Termination for "Just Cause" shall include termination because of the Executive'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, or material breach of any provision of the Agreement.

                       (c)        Except as provided pursuant to Section 9 hereof, in the event Executive's employment under this Agreement is terminated by the Savings Bank without Just Cause during

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the Term of this Agreement (including any renewal Term), the Savings Bank shall be obligated to continue to pay the Executive: i) the salary provided pursuant to Section 3(a) herein, up to the date of termination of the remaining Term of this Agreement, but in no event for a period of less than one year from such date of termination of employment; and ii) for the same minimum one year period, the cost of Executive obtaining all health, life, disability and other benefits which the Executive would be eligible to participate in during such period of payment, based upon the benefit levels substantially equal to those being provided Executive at the date of termination of employment. The provisions of this Section 6(c) shall survive the expiration of this Agreement.

                       (d)        The voluntary termination by the Executive during the term of this Agreement with the delivery of no less than 60 days written notice to the Board of Directors, other than pursuant to Section 9(b), in which case the Executive shall be entitled to receive only the compensation, vested rights, and all employee benefits up to the date of such termination.

            7.        Regulatory Exclusions.

                       (a)        If the Executive is suspended and/or temporarily prohibited from participating in the conduct of the Savings Bank's affairs by a notice served under Section 8(e)(3) or (g)(1) of the FDIA (12 U.S.C. 1818(e)(3) and (g)(1)), the Savings Bank's obligations under the Agreement shall be suspended as of the date of service, unless stayed by appropriate proceedings. If the charges in the notice are dismissed, the Savings Bank may within its discretion (i) pay the Executive all or part of the compensation withheld while its contract obligations were suspended and (ii) reinstate any of its obligations which were suspended.

                       (b)        If the Executive is removed and/or permanently prohibited from participating in the conduct of the Savings 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) and (g)(1)), all obligations of the Savings Bank under this Agreement shall terminate, as of the effective date of the order, but the vested rights of the parties shall not be affected.

                       (c)        If the Savings Bank is in default (as defined in Section 3(x)(1) of FDIA) all obligations under this Agreement shall terminate as of the date of default, but this paragraph shall not affect any vested rights of the contracting parties.

                       (d)        All obligations under this Agreement shall be terminated, except to the extent determined that continuation of this Agreement is necessary for the continued operation of the Savings Bank: (i) by the Director of the Office of Thrift Supervision ("Director of OTS"), or his designee, at the time that the Federal Deposit Insurance Corporation ("FDIC") enters into an agreement to provide assistance to or on behalf of the Savings Bank under the authority contained in Section 13(c) of FDIA; or (ii) by the Director of the OTS, or his designee, at the time that the Director of the OTS, or his designee approves a supervisory merger to resolve problems related to operation of the Savings Bank or when the Savings Bank is determined by the Director of the OTS to be in an unsafe or unsound condition. Any rights of the parties that have alrea dy vested, however, shall not be affected by such action.

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                       (e)        Notwithstanding anything herein to the contrary, any payments made to the Executive pursuant to the Agreement, or otherwise, shall be subject to and conditioned upon compliance with 12 USC 1828(k) and any regulations promulgated thereunder.

            8.        Disability. If the Executive shall become disabled or incapacitated to the extent that she is unable to perform her duties hereunder, by reason of medically determinable physical or mental impairment, as determined by a doctor engaged by the Board of Directors, Executive shall receive compensation and benefits in accordance with the terms of any plans or policies of the Savings Bank relating to short and long term disability, rather than pursuant to the Agreement. Such benefits shall be reduced by any benefits otherwise provided to the Executive during such period under the provisions of disability insurance coverage in effect for Savings Bank employees. Upon returning to active full-time employment, the Executive's full compensation as set forth in this Agreement shall be reinstated as of the date of commencement of such activities. In the event that the Executive returns to act ive employment on other than a full-time basis, then her compensation (as set forth in Section 3(a) of this Agreement) shall be reduced in proportion to the time spent in said employment, or as shall otherwise be agreed to by the parties.

            9.        Change in Control.

                       (a)        Notwithstanding any provision herein to the contrary, in the event of the involuntary termination of Executive's employment during the term of this Agreement following any Change in Control of the Savings Bank or Parent, or within twelve (12) months thereafter of such Change in Control, absent Just Cause, Executive shall be paid an amount equal to the product of two (2) times the Executive's "base amount" as defined in Section 280G(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code") and regulations promulgated thereunder. Said sum shall be paid in one (1) lump sum as of the date of such termination of service, and such payments shall be in lieu of any other future payments which the Executive would be otherwise entitled to receive under Section 6 of this Agreement. Notwithstanding the forgoing, all sums payable hereunder shall be reduced in such manner and to such extent so that no such payments made hereunder, when aggregated with all other payments to be made to the Executive by the Savings Bank or the Parent, shall be deemed an "excess parachute payment" in accordance with Section 280G of the Code and be subject to the excise tax provided at Section 4999(a) of the Code. The term "Change in Control" shall refer to: (i) the sale of all, or a material portion, of the assets of the Savings Bank or the Parent; (ii) the merger or recapitalization of the Savings Bank or the Parent whereby the Savings Bank or the Parent is not the surviving entity; (iii) a change in control of the Savings Bank or the Parent, as otherwise defined or determined by the Office of Thrift Supervision or regulations promulgated by it; or (iv) the acquisition, directly or indirectly, of the beneficial ownership (within the meaning of that term as it is used in Section 13(d) of the Securities Exchange Act of 1934 and the rules and regulations pr omulgated thereunder) of twenty-five percent (25%) or more of the outstanding voting securities of the Savings Bank or the Parent by any person, trust, entity or group. The term "person" means an individual other than the Executive, or a corporation, partnership, trust, association, joint venture, pool, syndicate, sole proprietorship, unincorporated organization or any other form of entity not specifically listed herein. The provisions of this Section 9(a) shall survive the expiration of this Agreement occurring after a Change in Control.

                       (b)        Notwithstanding any other provision of this Agreement to the contrary, Executive may voluntarily terminate her employment during the term of this Agreement following a Change in Control of the Savings Bank or Parent, or within twelve (12) months following such Change in Control, and upon the occurrence, or within 120 days thereafter, of any of the following events, which have not been consented to in advance by the Executive in writing: (i) if Executive

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would be required to move her personal residence or perform her principal executive functions more than forty (40) miles from the Executive's primary office as of the signing of this Agreement; or (ii) if the Savings Bank should fail to maintain Executive's base compensation in effect as of the date of the Change in Control and the existing employee benefits plans, including material fringe and retirement plans. Upon such voluntary termination of employment by the Executive in accordance with this subsection, Executive shall thereupon be entitled to receive the payments described in Section 9(a) of this Agreement. The provisions of this Section 9(b) shall survive the expiration of this Agreement occurring after a Change in Control.

            10.       Withholding. All payments required to be made by the Savings Bank hereunder to the Executive shall be subject to the withholding of such amounts, if any, relating to tax and other payroll deductions as the Savings Bank may reasonably determine should be withheld pursuant to any applicable law or regulation.

            11.      Successors and Assigns.

                       (a)        This Agreement shall inure to the benefit of and be binding upon any corporate or other successor of the Savings Bank or Parent which shall acquire, directly or indirectly, by merger, consolidation, purchase or otherwise, all or substantially all of the assets or stock of the Savings Bank or Parent.

                       (b)        Since the Savings Bank is contracting for the unique and personal skills of the Executive, the Executive shall be precluded from assigning or delegating her rights or duties hereunder without first obtaining the written consent of the Savings Bank.

            12.       Amendment; Waiver. No provisions of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing, signed by the Executive and such officer or officers as may be specifically designated by the Board of Directors of the Savings Bank to sign on its behalf. No waiver by any party hereto at any time of any breach by any other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

            13.       Governing Law. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the United States where applicable and otherwise by the substantive laws of the State of New Jersey.

            14.       Nature of Obligations. Nothing contained herein shall create or require the Savings Bank to create a trust of any kind to fund any benefits which may be payable hereunder, and to the extent that the Executive acquires a right to receive benefits from the Savings Bank hereunder, such right shall be no greater than the right of any unsecured general creditor of the Savings Bank.

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            15.       Headings. The section headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

            16.       Severability. The provisions of this Agreement shall be deemed severable and the invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of the other provisions of this Agreement, which shall remain in full force and effect.

            17.       Arbitration. Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be settled exclusively by arbitration in accordance with the rules then in effect of the district office of the American Arbitration Association ("AAA") nearest to the home office of the Savings Bank, and judgment upon the award rendered may be entered in any court having jurisdiction thereof, except to the extent that the parties may otherwise reach a mutual settlement of such issue. The provisions of this Section 17 shall survive the expiration of this Agreement.

            18.       Confidential Information. The Executive acknowledges that during her employment she will learn and have access to confidential information regarding the Savings Bank and the Parent and its customers and businesses ("Confidential Information"). The Executive agrees and covenants not to disclose or use for her own benefit, or the benefit of any other person or entity, any such Confidential Information, unless or until the Savings Bank or the Parent consents to such disclosure or use or such information becomes common knowledge in the industry or is otherwise legally in the public domain. The Executive shall not knowingly disclose or reveal to any unauthorized person any Confidential Information relating to the Savings Bank, the Parent, or any subsidiaries or affiliates, or to any of the businesses operated by them, and the Executive confirms that such information constitutes the exclusive p roperty of the Savings Bank and the Parent. The Executive shall not otherwise knowingly act or conduct herself (a) to the material detriment of the Savings Bank or the Parent, or its subsidiaries, or affiliates, or (b) in a manner which is inimical or contrary to the interests of the Savings Bank or the Parent. Notwithstanding anything herein to the contrary, failure by the Executive to comply with the provisions of this Section may result in the immediate termination of the Agreement within the sole discretion of the Savings Bank, disciplinary action against the Executive taken by the Savings Bank, including but not limited to the termination of employment of the Executive for breach of the Agreement and the provisions of this Section, and other remedies that may be available in law or in equity.

            19.       Compliance with Section 409A of the Code. Not withstanding anything herein to the contrary, any payments to be made in accordance with Sections 6 or 9 of the Agreement shall not be made prior to the date that is 183 calendar days from the date of termination of employment of the Executive if it is determined by the Savings Bank or the Parent in good faith that such payments to be made to such Executive are subject to the limitations set forth at Section 409A of the Code and regulations promulgated thereunder, and payments made in advance of such date would result in the requirement for the Executive to pay additional interest and taxes to be imposed in accordance with Section 409A(a)(1)(B) of the Code.

            20.       Entire Agreement. This Agreement together with any understanding or modifications thereof as agreed to in writing by the parties, shall constitute the entire agreement between the parties hereto.

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            IN WITNESS WHEREOF, the parties have executed this Agreement on the date first hereinabove written.

	AMERICAN BANK OF NEW JERSEY
	By:	/s/ W. George Parker W. George Parker Chairman
ATTEST:       /s/ Kathleen Walsh Sectretary

WITNESS:
/s/ Kathleen Walsh	/s/ Catherine M. Bringuier Catherine M. Bringuier Executive

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End.

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Joseph Kliminski, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of American Bancorp of New Jersey, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report;
4.	The issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the issuer and have:
	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	(b)	Evaluated the effectiveness of the issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and
	(c)	Disclosed in this report any change in the issuer's internal control over financial reporting that occurred during the issuer's most recent fiscal quarter (the issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the issuer's internal control over financial reporting; and
5.	The issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer's auditors and the audit committee of the issuer's board of directors:
	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the issuer's ability to record, process, summarize and report financial information; and
	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuer's internal control over financial reporting

Dated: May 15, 2006  /s/ Joseph KliminskiJoseph Kliminski
Chief Executive Officer
 

EX-31.2

EXHIBIT 31.2
 

CERTIFICATION

I, Eric B. Heyer, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of American Bancorp of New Jersey, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report;
4.	The issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the issuer and have:
	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	(b)	Evaluated the effectiveness of the issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and
	(c)	Disclosed in this report any change in the issuer's internal control over financial reporting that occurred during the issuer's most recent fiscal quarter (the issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the issuer's internal control over financial reporting; and
5.	The issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the issuer's board of directors:
	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the issuer's ability to record, process, summarize and report financial information; and
	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuer's internal control over financial reporting

Dated: May 15, 2006  /s/ Eric B. HeyerEric B. Heyer
Senior Vice President and Chief Financial Officer

EX-32

EXHIBIT 32

CERTIFICATION PURSUANT TO
18 U.S.C. ss.1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

              In connection with the Quarterly Report of American Bancorp of New Jersey, Inc. (the "Company") on Form 10-Q for the period ending March 31, 2006 (the "Report") as filed with the Securities and Exchange Commission on the date hereof, we Joseph Kliminski, Chief Executive Officer, and Eric Heyer, Senior Vice President and Chief Financial Officer, certify pursuant to 18 U.S.C. ss.1350, as adopted pursuant to ss.906 of the Sarbanes-Oxley Act of 2002, that:

1.	The Report fully complies with the requirements of Section 13 (a) of the Securities Exchange Act of 1934; and
2.	The information contained in such Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods presented in the financial statements included in such report.

Dated:	May 15, 2006	/s/ Joseph KliminskiJoseph Kliminski Chief Executive Officer
Dated:	May 15, 2006	/s/ Eric B. HeyerEric B. Heyer Senior Vice President and Chief Financial Officer