8-K

SECURITES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):    April 24, 2003

MASSBANK Corp.

(Exact name of Registrant as specified in its charter)

Delaware	0-15137	04-2930382
State or other Jurisdiction of Incorporation	(Commission File Number)	(I.R.S. Employee Identification Number)

123 Haven Street

Reading, MA 01867

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code:    (781)662-0100

Form 8-K

Item 7.    Financial Statements and Exhibits

(a) Not applicable

(b) Not applicable

(c) Exhibits

99.1    Press Release, dated April 24, 2003

Item 9.    Regulation FD Disclosure (Information provided under Item 12 – Results of Operations and Financial Condition.)

On April 24, 2003, MASSBANK Corp. issued a Press Release reporting financial results for the first quarter of fiscal year 2003. A copy of the Press Release is being furnished as Exhibit 99.1 to this report and is incorporated into this report by reference.

Item 12 of Form 8-K, “Results of Operations and Financial Condition,” requires the Company to furnish the Press Release to the Securities and Exchange Commission. In accordance with interim guidance issued by the Securities and Exchange Commission in Release No. 33-8216, MASSBANK Corp. is furnishing the Press Release required by Item 12 under Item 9 of this report.

April 25, 2003

Page Two

The information being furnished under Item 9 of this report shall not be considered “filed” for purposes of the Securities Exchange Act of 1934, as amended.

Signatures:

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

Date: April 25, 2003	MASSBANK Corp.
	By:	/s/    REGINALD E. CORMIER
	Name: Title:	Reginald E. Cormier Sr.V.P., Treasurer and CFO

EX-99.1

Exhibit 99.1

MASSBANK CORP. Reading, MA April 24, 2003

FOR IMMEDIATE RELEASE

MASSBANK CORP. REPORTS FIRST QUARTER 2003 EARNINGS OF

$1.95 MILLION OR $0.42 PER SHARE

AND DECLARES CASH DIVIDEND

MASSBANK Corp. (NASDAQ:MASB), the Holding Company for MASSBANK, today reported net income of $1,945,000 or $0.42 in diluted earnings per share for the first quarter 2003, compared with net income of $2,650,000 or $0.55 in diluted earnings per share in the first quarter of 2002. Basic earnings per share in the recent quarter were $0.43 per share compared to $0.56 per share in the first quarter of last year.

The decline in the Company’s net income for the first quarter 2003 compared to the same quarter of 2002 is primarily due to a decrease in securities gains of $893,000 due to the poor performance of the stock markets and the impact on the Company’s equity investments. Earnings results also reflect a decrease in net interest income of $198,000 due to the continued pressure on the Company’s net interest margin resulting from low interest rates. First quarter 2003 earnings results reflect a decrease in other non-interest income of $57,000 and an increase in non-interest expense of $14,000 partially offset by a decrease in income tax expense of $457,000 due to lower income before taxes and a decline in the Company’s effective income tax rate.

In the first quarter 2003, the Company recorded net gains on securities of $40,000 compared to net securities gains of $933,000 in the same quarter of last year. Net securities gains in the recent quarter consisted of losses on trading securities of $78,000 and net gains on securities available for sale of $118,000. Net gains on securities available for sale in the first quarter 2003 were comprised of $258,000 in gains on debt securities and $140,000 in losses on equity securities. This compares to $3,000 in gains on debt securities and $996,000 in gains on equity securities for the same quarter of 2002.

Over the last twelve months, as a result of the equity securities gains the Company has taken and a decline in equity market prices, the net unrealized gains in the Company’s equity securities portfolio have been exhausted. During this same period, however, falling interest rates have increased the value of the Company’s debt securities and as a result total net unrealized gains on securities, net of tax effect, are a positive $6.1 million at the end of the first quarter 2003. This compares to a positive $4.8 in net unrealized gains at the end of the first quarter 2002.

The Company’s total assets increased $27.1 million or 2.7% to $1.016 billion at March 31, 2003 from $988.9 million at March 31, 2002. Deposits also increased $27.8 million or 3.2% year-over-year reaching $895.3 million as of March 31, 2003. Stockholders’ equity was $114.3 million at March 31, 2003, representing a book value of $25.17 per share. This compares to $114.7 million at March 31, 2002 representing a book value of $24.21 per share.

April 24, 2003

Page Two

The Company’s non-performing assets remain relatively low totaling $448,000 at March 31, 2003 representing 0.04% of total assets. This compares to $335,000 representing 0.03% of total assets at March 31, 2002.

MASSBANK Corp. is the holding company for MASSBANK, a Massachusetts chartered savings bank. The Bank operates fifteen banking offices in Reading, Chelmsford, Dracut, Everett, Lowell, Medford, Melrose, Stoneham, Tewksbury, Westford and Wilmington, providing a variety of deposit, lending and trust services.

ADDITIONAL INFORMATION

Dividend Declaration

MASSBANK Corp. today announced a quarterly cash dividend on its common stock of $0.23 per share. This, the Company’s sixty-seventh consecutive dividend, will be payable on May 22, 2003 to stockholders of record at the close of business on May 7, 2003.

Stock Repurchase Program

During the three months ended March 31, 2003, the Company continued the repurchase of its common stock by acquiring 101,000 shares. As of March 31, 2003 there were 177,758 shares available for repurchase in the current program.

Annual Meeting of Stockholders

At the sixteenth annual meeting of stockholders of MASSBANK Corp. held April 22, 2003, stockholders voted affirmatively on the following proposal:

Election of Directors

To elect Allan S. Bufferd, Kathleen M. Camilli, Nancy L. Pettinelli and Dr. Donald B. Stackhouse to serve until the 2006 Annual Meeting of Stockholders.

Cautionary Statement

This press release may contain forward-looking information, including information concerning the Company’s expectations of future business prospects. These forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results or performance to be materially different from the results and performance expressed or implied by the forward-looking statements. Forward looking statements include, but are not limited to, statements concerning the Company’s future performance, the financial outlook of the markets it serves and the performance and activities of its competitors. These statements reflect the Company’s current views. They are based on numerous assumptions and are subject to numerous risks and uncertainties, including unexpected fluctuations in market interest rates, unexpected fluctuations in the markets for equities, bonds, federal funds and other financial instruments, an increase in the level of non-performing assets, an increase in competitive pricing pressures within the Company’s market, adverse legislative or regulatory developments, adverse impacts resulting from the continuing war on terrorism, the impact of inflation, and other factors described in the Company’s annual report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2002.

For further information contact Reginald E. Cormier, Senior Vice President, Treasurer and CFO at (781) 942-8192.

April 24, 2003

Page Three

MASSBANK CORP.

FINANCIAL HIGHLIGHTS

($ in thousands except share data)

	Three Months Ended March 31,
	2003			2002
For the Period Ended
Total interest and dividend income	$	10,361		$	12,040
Total interest expense		4,613			6,094
Net interest income		5,748			5,946
Provision for loan losses		—			—
Gains on securities, net		40			933
Other non-interest income		266			323
Non-interest expense		3,049			3,035
Income tax expense		1,060			1,517
Net income		1,945			2,650
Weighted Average Common Shares Outstanding (1)
Basic		4,557,308			4,733,781
Diluted		4,636,652			4,861,614
Per Common Share (1)
Earnings:
Basic	$	0.43		$	0.56
Diluted		0.42			0.55
Cash dividends paid		0.23			0.22
Book value (period end)		25.17			24.21
Ratios (2)
Return on average assets		0.77	%		1.08	%
Return on average equity		6.73			9.11
Interest rate spread		2.09			2.15
Net interest margin		2.33			2.49
Total equity to assets (period end)		11.25			11.60
	At March 31,
	2003			2002
At Period End
Assets	$	1,015,918		$	988,855
Deposits		895,274			867,482
Loans		306,858			345,875
Total stockholders’ equity		114,270			114,746
Common shares outstanding (1)		4,539,301			4,738,973
Asset Quality
Non-accrual loans	$	448		$	335
Real estate acquired through foreclosure		—			—
Total non-performing assets	$	448		$	335
Allowance for loan losses	$	2,653		$	2,643
Non-accrual loans to total loans		0.15	%		0.10	%
Non-performing assets to total assets		0.04	%		0.03	%
Allowance for loan losses as a % of non-accrual loans		592.2	%		789.0	%
Allowance for loan losses as a % of non-performing assets		592.2	%		789.0	%

(1) Current and prior year share data reflect the three-for-two stock split of April 19, 2002.

(2) Ratios are presented on an annualized basis with the exception of equity to assets.

April 24, 2003

Page Four

MASSBANK CORP. AND SUBSIDIARIES

Consolidated Balance Sheets

(Unaudited)

($ in thousands except share data)

	At March 31, 2003			At March 31, 2002
Assets:
Cash and due from banks	$	9,798		$	10,374
Interest-bearing deposits in banks		5,482			6,050
Federal funds sold		214,328			155,053
Short-term investments		27,157			24,749
Debt securities available for sale		325,808			375,870
Equity securities available for sale		10,937			13,638
Trading securities		94,506			38,743
Loans:
Mortgage loans		292,467			311,806
Other loans		14,391			34,069
Total loans		306,858			345,875
Allowance for loan losses		(2,653	)		(2,643	)
Net loans		304,205			343,232
Premises and equipment		7,063			6,831
Accrued interest receivable		3,721			4,785
Goodwill		1,090			1,090
Other assets		11,823			8,440
Total assets	$	1,015,918		$	988,855
Liabilities and Stockholders’ Equity:
Deposits:
Demand and NOW	$	82,861		$	83,595
Savings		584,707			430,376
Time certificates of deposit		227,706			353,511
Total deposits		895,274			867,482
Escrow deposits of borrowers		1,363			1,428
Employee stock ownership plan liability		—			156
Current income taxes		569			1,152
Deferred income taxes		1,703			1,152
Other liabilities		2,739			2,739
Total liabilities		901,648			874,109
Stockholders’ equity:
Preferred stock, par value $1.00 per share; 2,000,000 shares authorized, none issued		—			—
Common stock, par value $1.00 per share; 10,000,000 shares authorized, 7,642,430 and 7,525,104 shares issued, respectively		7,642			7,525
Additional paid-in capital		53,819			63,557
Retained earnings		96,138			101,603
		157,599			172,685
Treasury stock at cost 3,127,829 and 4,380,589 shares, respectively		(49,427	)		(62,544	)
Accumulated other comprehensive income:
Net unrealized gains on securities available for sale, net of tax effect		6,098			4,761
Common stock acquired by ESOP		—			(156	)
Total stockholders’ equity		114,270			114,746
Total liabilities and stockholders’ equity	$	1,015,918		$	988,855

April 24, 2003

Page Five

MASSBANK CORP. AND SUBSIDIARIES

Consolidated Statements of Income

($ in thousands except share data)

	Three Months Ended
	March 31, 2003			March 31, 2002
Interest and dividend income:
Mortgage loans	$	4,931		$	5,182
Other loans		239			401
Securities available for sale:
Mortgage-backed securities		2,690			4,145
Other securities		1,493			1,231
Trading securities		263			128
Federal funds sold		621			725
Other investments		124			228
Total interest and dividend income		10,361			12,040
Interest expense:
Deposits		4,613			6,094
Total interest expense		4,613			6,094
Net interest income		5,748			5,946
Provision for loan losses		—			—
Net interest income after provision for loan losses		5,748			5,946
Non-interest income:
Deposit account service fees		137			146
Gains on securities available for sale, net		118			999
Losses on trading securities, net		(78	)		(66	)
Other		129			177
Total non-interest income		306			1,256
Non-interest expense:
Salaries and employee benefits		1,842			1,826
Occupancy and equipment		573			521
Data processing		144			128
Professional services		111			144
Advertising and marketing		25			41
Deposit Insurance		45			46
Other		309			329
Total non-interest expense		3,049			3,035
Income before income taxes		3,005			4,167
Income tax expense		1,060			1,517
Net income	$	1,945		$	2,650
Weighted average common shares outstanding:
Basic		4,557,308			4,733,781
Diluted		4,636,652			4,861,614
Earnings per share (in dollars):
Basic		$0.43			$0.56
Diluted		0.42			0.55