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

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2004

Commission file number 000-24272

FLUSHING FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of incorporation or organization)

11-3209278
(I.R.S. Employer Identification No.)

1979 Marcus Avenue, Suite E140, Lake Success, New York 11042
(Address of principal executive offices)

(718) 961-5400
(Registrant's telephone number, including area code)

144-51 Northern Boulevard Flushing, New York 11354
(Former address if changed since last report)

Securities registered pursuant to Section 12(b) of the Act: None.

Securities registered pursuant to Section 12(g) of the Act: Common Stock $0.01 par value (and
                                                                                                    associated Preferred Stock Purchase Rights).

           Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for 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.    X   Yes          No

           Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).    X   Yes          No

           The number of shares of the registrant's Common Stock outstanding as of October 29, 2004 was 19,186,859.

TABLE OF CONTENTS

	PAGE
PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
Consolidated Statements of Financial Condition	1
Consolidated Statements of Income and Comprehensive Income	2
Consolidated Statements of Cash Flows	3
Consolidated Statements of Changes in Stockholders' Equity	4
Notes to Consolidated Statements	5
ITEM 2. Management's Discussion and Analysis of Financial      Condition and Results of Operations	9
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk	23
ITEM 4. Controls and Procedures	23
PART II - OTHER INFORMATION
ITEM 1. Legal proceedings	23
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds	23
ITEM 3. Defaults Upon Senior Securities	23
ITEM 4. Submission of Matters to a Vote of Security Holders	24
ITEM 5. Other Information	24
ITEM 6. Exhibits	25
SIGNATURES	26

i

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Consolidated Statements of Financial Condition

(Dollars in thousands, except share data)	September 30, 2004			December 31, 2003
	(Unaudited)
ASSETS
Cash and due from banks	$	14,096		$	20,300
Federal funds sold		13,000			—
Securities available for sale:
Mortgage-backed securities		421,005			479,393
Other securities		41,406			56,316
Loans:
Multi-family residential		618,019			541,837
Commercial real estate		329,026			290,332
One-to-four family - mixed-use property		308,871			226,225
One-to-four family - residential		160,609			178,474
Co-operative apartment		3,203			3,729
Construction		29,754			23,622
Small Business Administration		5,121			4,931
Commercial business and other		8,480			4,894
Unearned loan fees and deferred costs, net		4,173			2,030
Allowance for loan losses		(6,546	)		(6,553	)
Net loans		1,460,710			1,269,521
Interest and dividends receivable		8,991			8,647
Real estate owned, net		—			—
Bank premises and equipment, net		7,186			6,380
Federal Home Loan Bank of New York stock		21,761			24,462
Goodwill		3,905			3,905
Other assets		45,916			41,827
Total assets	$	2,037,976		$	1,910,751
LIABILITIES
Due to depositors:
Non-interest bearing	$	48,979		$	41,397
Interest-bearing:
Certificate of deposit accounts		691,602			593,760
Passbook savings accounts		216,420			216,988
Money market accounts		263,852			263,621
NOW accounts		45,030			42,809
Total interest-bearing deposits		1,216,904			1,117,178
Mortgagors' escrow deposits		20,772			11,334
Borrowed funds		574,743			578,142
Other liabilities		20,130			15,938
Total liabilities		1,881,528			1,763,989
STOCKHOLDERS' EQUITY
Preferred stock ($0.01 par value; 5,000,000     shares authorized)		—			—
Common stock ($0.01 par value; 40,000,000     shares authorized; 19,456,696 shares issued      and 19,183,119 shares outstanding at      September 30, 2004, 19,290,601 shares issued      and outstanding at December 31, 2003)		195			193
Additional paid-in capital		36,069			32,783
Treasury stock, at average cost (273,577     shares and none at September 30, 2004     and December 31, 2003, respectively)		(4,503	)		—
Unearned compensation		(5,001	)		(7,373	)
Retained earnings		130,711			120,683
Accumulated other comprehensive income     (loss), net of taxes		(1,023	)		476
Total stockholders' equity		156,448			146,762
Total liabilities and stockholders' equity	$	2,037,976		$	1,910,751

The accompanying notes are an integral part of these consolidated financial statements.
-1-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Consolidated Statements of Income and Comprehensive Income

	For the three months						For the nine months
	ended September 30,						ended September 30,
(In thousands, except per share data)	2004			2003			2004			2003
	(Unaudited)
Interest and dividend income
Interest and fees on loans	$	25,077		$	23,460		$	72,923		$	69,687
Interest and dividends   on securities:
Interest		4,800			4,552			15,385			13,255
Dividends		84			79			256			169
Other interest income		61			34			124			151
Total interest and              dividend income		30,022			28,125			88,688			83,262
Interest expense
Deposits		7,247			6,694			21,194			20,703
Other interest expense		5,903			6,233			17,350			18,727
Total interest expense		13,150			12,927			38,544			39,430
Net interest income		16,872			15,198			50,144			43,832
Provision for loan losses		--			--			--			--
Net interest income after   provision for loan losses		16,872			15,198			50,144			43,832
Non-interest income
Other fee income		911			871			2,753			2,498
Net gain on sale of loans held for sale		47			76			227			246
Net gain (loss) on sales of securities		5			25			(11	)		6
Other income		565			690			1,650			2,165
Total non-interest income		1,528			1,662			4,619			4,915
Non-interest expense
Salaries and employee benefits		4,114			4,017			13,620			11,949
Occupancy and equipment		931			799			2,575			2,205
Professional services		791			758			2,491			2,134
Data processing		465			530			1,468			1,350
Depreciation and amortization		371			322			1,096			872
Other operating expenses		1,470			1,496			4,690			4,551
Total non-interest expense		8,142			7,922			25,940			23,061
Income before income taxes		10,258			8,938			28,823			25,686
Provision for income taxes
Federal		2,969			2,620			8,580			7,637
State and local		1,032			801			2,661			2,188
Total taxes		4,001			3,421			11,241			9,825
Net income	$	6,257		$	5,517		$	17,582		$	15,861
Other comprehensive income   (loss), net of tax
Unrealized gains (losses)   on securities:
Unrealized holding gains      (losses) arising during period	$	3,613		$	(2,855	)	$	(1,505	)	$	(3,151	)
Reclassification adjustments      for (gains) losses included      in income		(3	)		(13	)		6			(3	)
Net unrealized holding             gains (losses )		3,610			(2,868	)		(1,499	)		(3,154	)
Comprehensive net income	$	9,867		$	2,649		$	16,083		$	12,707
Basic earnings per share	$	0.36		$	0.32		$	1.01		$	0.93
Diluted earnings per share	$	0.35		$	0.31		$	0.97		$	0.90
Dividends per share	$	0.09		$	0.073		$	0.26		$	0.207

The accompanying notes are an integral part of these consolidated financial statements.
-2-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Consolidated Statements of Cash Flows

	For the nine months ended
	September 30,
(In thousands)	2004			2003
	(Unaudited)
OPERATING ACTIVITIES
Net income	$	17,582		$	15,861
Adjustments to reconcile net income to net cash provided   by operating activities:
Depreciation and amortization of        bank premises and equipment		1,096			872
Net loss (gain) on sales of securities		11			(6	)
Net gain on sales of loans		(227	)		(246	)
Amortization of unearned premium,        net of accretion of unearned discount		1,610			2,702
Deferred income tax (benefit) provision		(189	)		1,753
Deferred compensation		1,138			542
Origination of loans held for sale		(4,962	)		(9,078	)
Proceeds from sale of loans originated for sale		4,962			9,078
Net decrease in other assets and liabilities		(773	)		(1,836	)
Unearned compensation		2,396			1,148
Net cash provided by operating activities		22,644			20,790
INVESTING ACTIVITIES
Purchases of bank premises and equipment		(1,902	)		(1,664	)
Redemptions (purchases) of Federal Home Loan Bank shares		2,701			(3,000	)
Purchases of securities available for sale		(102,186	)		(366,481	)
Proceeds from sales and calls of securities available for sale		78,822			62,391
Proceeds from maturities and prepayments of securities   available for sale		95,794			155,324
Proceeds from sale of non-performing loans		1,980			3,502
Net originations and repayment of loans		(193,355	)		(64,982	)
Purchases of loans		--			(789	)
Net cash used by investing activities		(118,146	)		(215,699	)
FINANCING ACTIVITIES
Net increase in non-interest bearing deposits		7,582			3,109
Net increase in interest-bearing deposits		99,726			113,860
Net increase in mortgagors' escrow deposits		9,438			4,345
Net decrease in short-term borrowed funds		(25,000	)		--
Proceeds from long-term borrowed funds		110,000			130,000
Repayment of long-term borrowed funds		(89,018	)		(70,017	)
Purchases of treasury stock		(8,360	)		(7,069	)
Proceeds from issuance of common stock   upon exercise of stock options		2,484			3,425
Cash dividends paid		(4,554	)		(3,573	)
Net cash provided by financing activities		102,298			174,080
Net increase (decrease) in cash and cash equivalents		6,796			(20,829	)
Cash and cash equivalents, beginning of period		20,300			47,619
Cash and cash equivalents, end of period	$	27,096		$	26,790
SUPPLEMENTAL CASH FLOW DISCLOSURE
Interest paid	$	38,417		$	39,428
Income taxes paid		8,835			6,611
Non-cash activities:
Securities purchased not yet settled		2,800			9,851

The accompanying notes are an integral part of these consolidated financial statements.
-3-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Consolidated Statements of Changes in Stockholders' Equity
(Unaudited)

	For the nine months ended
(In thousands, except share data)	September 30, 2004
Common Stock
Balance, beginning of period	$	193
Issuance upon the exercise of stock options   (166,095 common shares)		2
Balance, end of period	$	195
Additional Paid-In Capital
Balance, beginning of period	$	32,783
Award of shares released from Employee   Benefit Trust (3,931 common shares)		57
Surrender of restricted stock awards (124,650   common shares) which were replaced with   restricted stock units		(227	)
Options exercised (166,095 common shares)		858
Tax benefit from compensation expense in   excess of that recognized for financial   reporting purposes		2,598
Balance, end of period	$	36,069
Treasury Stock
Balance, beginning of period	$	--
Purchases of common shares outstanding   (453,679 common shares)		(8,023	)
Surrender of restricted stock awards (124,650   common shares) which were replaced with   restricted stock units		(1,177	)
Repurchase of restricted stock awards (25,066   common shares) to satisfy tax obligations		(433	)
Shares issued upon vesting of restricted stock   unit awards (42,390 common shares)		579
Forfeiture of restricted stock awards   (1,050 common shares)		(13	)
Issuance for Options exercised   (288,478 common shares)		4,564
Balance, end of period	$	(4,503	)
Unearned Compensation
Balance, beginning of period	$	(7,373	)
Restricted stock award expense		1,333
Surrender of restricted stock awards (124,650   common shares) which were replaced with   restricted stock units		564
Forfeiture of restricted stock awards   (1,050 common shares)		13
Release of shares from Employee Benefit Trust   (135,698 common shares)		462
Balance, end of period	$	(5,001	)
Retained Earnings
Balance, beginning of period	$	120,683
Net income		17,582
Options exercised (288,478 common shares)		(2,844	)
Shares issued upon vesting of restricted stock units   (42,390 common shares)		(156	)
Cash dividends declared and paid		(4,554	)
Balance, end of period	$	130,711
Accumulated Other Comprehensive Income (Loss)
Balance, beginning of period	$	476
Change in net unrealized gain (loss),   net of taxes of approximately $1,200 on   securities available for sale		(1,505	)
Less: Reclassification adjustment for losses included   in net income, net of taxes   of approximately $(5)		6
Balance, end of period	$	(1,023	)

The accompanying notes are an integral part of these consolidated financial statements.
-4-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Notes to Consolidated Financial Statements

1.      Basis of Presentation

The primary business of Flushing Financial Corporation (the "Holding Company") is the operation of its wholly-owned subsidiary, Flushing Savings Bank, FSB (the "Bank"). The consolidated financial statements presented in this Form 10-Q include the collective results of the Holding Company and the Bank, but reflect principally the Bank's activities.

The information furnished in these interim statements reflects all adjustments which are, in the opinion of management, necessary for a fair presentation of the results for such periods of Flushing Financial Corporation and Subsidiaries (the "Company"). Such adjustments are of a normal recurring nature, unless otherwise disclosed in this Form 10-Q. The results of operations in the interim statements are not necessarily indicative of the results that may be expected for the full year.

Certain information and note disclosures normally included in financial statements prepared in conformity with generally accepted accounting principles in the United States of America ("GAAP") have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). The interim financial information should be read in conjunction with the Company's 2003 Annual Report on Form 10-K.

2.       Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and reported amounts of revenue and expenses during the reporting period. Actual results could differ from these estimates.

3.      Earnings Per Share

Basic earnings per share for the three and nine month periods ended September 30, 2004 and 2003 was computed by dividing net income by the total weighted average number of common shares outstanding, including only the vested portion of restricted stock and restricted stock unit awards. Diluted earnings per share includes the additional dilutive effect of stock options outstanding and the unvested portion of restricted stock and restricted stock unit awards during the period. Earnings per share has been computed based on the following:

	Three months ended						Nine months ended
	September 30,						September 30,
(Amounts in thousands, except per share data)	2004			2003			2004			2003
Net income	$	6,257		$	5,517		$	17,582		$	15,861
Divided by:
Weighted average common         shares outstanding		17,458			17,104			17,424			16,985
Weighted average common stock         equivalents		593			711			673			713
Total weighted average common shares &   common stock equivalents		18,051			17,815			18,097			17,698
Basic earnings per share	$	0.36		$	0.32		$	1.01		$	0.93
Diluted earnings per share	$	0.35		$	0.31		$	0.97		$	0.90
Dividends per share	$	0.09		$	0.073		$	0.26		$	0.207
Dividend payout ratio		25.00	%		22.92	%		25.74	%		22.14	%

Common stock equivalents that are antidilutive are not included in the computation of diluted earnings per share. There were no common stock equivalents that were considered antidilutive for the three- and nine-month periods ended September 30, 2004. Options to purchase 900 shares, at an average exercise price of $14.70, and unvested restricted stock awards of 450 shares, at an average market price on date of grant of $14.70, were not included in the computation of diluted earnings per share for the three months ended September 30, 2003. Options to purchase 268,050 shares, at an average exercise price of $13.55, and unvested restricted stock awards of 81,787 shares, at an average market price on date of grant of $13.51, were not included in the computation of diluted earnings per share for the nine months ended September 30, 2003.

-5-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Notes to Consolidated Financial Statements

4.      Stock Option Plans

As permitted by SFAS No. 123, "Accounting for Stock-Based Compensation", the Company has chosen to apply APB Opinion No. 25, "Accounting for Stock Issued to Employees" and related Interpretations in accounting for its Stock Option Plan. Accordingly, no compensation expense has been recognized for options granted under the Stock Option Plan. Compensation expense is recognized in the financial statements for restricted stock and restricted stock unit awards. The following table illustrates the effect on net income and earnings per share if the Company had applied the fair value recognition provisions of SFAS No. 123 to all stock-based compensation. However, the present impact of SFAS No. 123 may not be representative of the effect on income in future periods because the options vest over several years and additional option grants may be made each year.

	Three months ended						Nine months ended
	September 30,						September 30,
(Dollars in thousands, except per share data)	2004			2003			2004			2003
Net income, as reported	$	6,257		$	5,517		$	17,582		$	15,861
Add: Stock-based compensation   expense included in reported   net income, net of related   tax effects		139			170			1,158			513
Deduct: Total stock-based compensation   expense determined under fair   value based method for all awards,   net of related tax effects		(306	)		(365	)		(2,798	)		(1,043	)
Pro forma net income	$	6,090		$	5,322		$	15,942		$	15,331
Basic earnings per share:
As reported	$	0.36		$	0.32		$	1.01		$	0.93
Pro forma	$	0.35		$	0.31		$	0.91		$	0.90
Diluted earnings per share:
As reported	$	0.35		$	0.31		$	0.97		$	0.90
Pro forma	$	0.34		$	0.30		$	0.88		$	0.87

There were no grants of stock options, restricted stock awards, or restricted stock unit awards in the three-month period ended September 30, 2004. There were stock option grants of 900 shares of common stock, at an average exercise price of $14.70, and restricted stock awards of 450 shares of common stock, at an average market price on date of grant of $14.70, in the three-month period ended September 30, 2003.

There were stock option grants of 201,700 shares of common stock, at an average exercise price of $17.36, and 268,050 shares of common stock, at an average exercise price of $13.55, in the nine-month periods ended September 30, 2004 and 2003, respectively. There were restricted stock and restricted stock unit awards of 73,783 shares of common stock, at an average market price on date of grant of $16.95, and 81,783 shares of common stock, at an average market price on date of grant of $13.51, in the nine-month periods ended September 30, 2004 and 2003, respectively.

The nine-month period ended September 30, 2004 includes a charge to earnings, on an after-tax basis, of $0.2 million or $0.01 per diluted share, recorded in the second quarter of 2004, related to certain restricted stock unit awards in June 2004. In addition to the previously mentioned charge, the nine-month period ended September 30, 2004 includes a charge to earnings (recorded during the three months ended March 31, 2004), on an after-tax basis, of $0.5 million or $0.03 per diluted share, related to an adjustment of compensation expense for certain restricted stock awards made in prior periods. These charges reflect that certain participants under these plans have reached, or are close to reaching, retirement eligibility, at which time such awards will be fully vested. These amounts are included above in stock-based compensation expense.

In addition, the nine-month period ended September 30, 2004 includes, in the deduction for stock-based compensation determined under fair value method, a net after tax charge of $0.4 million or $0.02 per diluted share, related to certain stock option grants awarded in June 2004. In addition to the previously mentioned deduction, the nine-month period ended September 30, 2004 includes, in the deduction for stock-based compensation determined under the fair value method, a net after tax deduction of $0.8 million or $0.04 per diluted share, related to an adjustment of compensation expense using the fair value method for stock option grants awarded during prior periods. These deductions reflect that certain participants under these plans have reached, or are close to reaching, retirement eligibility, at which time such awards will be fully vested.

-6-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Notes to Consolidated Financial Statements

5.      Recent Accounting Pronouncements

In January 2003, the Financial Accounting Standards Board ("FASB") issued FASB Interpretation No. 46, "Consolidation of Variable Interest Entities" ("FIN 46"), which established guidance for determining when an entity should consolidate another entity that meets the definition of a variable interest entity ("VIE"). A VIE exists either when the entity does not have sufficient equity at risk or lacks any one of three characteristics normally associated with a controlling financial interest. If an entity is considered a VIE, judgment and quantitative analysis typically is required to assess whether the company should consolidate the entity as the primary beneficiary. The company is considered the primary beneficiary when it has a variable interest that will absorb a majority of an entity's expected losses, receive a majority of an entity's expected residual returns, or both. In December 2003, the FASB issued a revision to FIN 46, FIN 46R, to address various technical corrections and implementation issues that have arisen since its issuance. The provisions of FIN 46R were effective beginning in the first quarter of 2004.

The Holding Company owns Flushing Financial Capital Trust I (the "Trust"), a special purpose business trust formed to issue capital securities, which is subject to FIN 46 and FIN 46R. Prior to 2004, the Trust was consolidated. Since the Holding Company does not have sufficient equity at risk, as defined in FIN 46R, the Trust was deconsolidated, effective with the first quarter of 2004. Deconsolidation of the Trust has not had a material impact on the Company's financial statements.

6.      Stock Split

On November 18, 2003, the Board of Directors of the Holding Company declared a three-for-two split of the Holding Company's common stock to be paid in the form of a 50% stock dividend, payable on December 15, 2003. Each stockholder received one additional share for every two shares of the Holding Company's common stock held at the record date, December 1, 2003. All historical share and per share amounts reported in this Form 10-Q have been restated to reflect the three-for-two stock split paid in the form of a stock dividend on December 15, 2003.

-7-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Notes to Consolidated Financial Statements

7.      Pension and Other Postretirement Benefit Plans

The following table sets forth the components of net expense for the pension and other postretirement benefit plans.

	Three months ended						Nine months ended
	September 30,						September 30,
	2004			2003			2004			2003
	(In thousands)
Employee Pension Plan:
Service cost	$	156		$	139		$	466		$	416
Interest cost		197			188			591			565
Amortization of unrecognized loss		20			4			61			13
Amortization of past service liability		(4	)		(6	)		(10	)		(18	)
Expected return on plan assets		(292	)		(271	)		(875	)		(815	)
Net employee pension expense	$	77		$	54		$	233		$	161
Outside Director Pension Plan:
Service cost	$	19		$	10		$	56		$	30
Interest cost		12			5			37			15
Amortization of unrecognized loss		4			4			11			11
Amortization of past service liability		35			29			106			89
Net outside director pension expense	$	70		$	48		$	210		$	145
Other Postretirement Benefit Plans:
Service cost	$	41		$	38		$	124		$	114
Interest cost		54			54			164			163
Amortization of unrecognized loss		13			15			38			46
Amortization of past service liability		(33	)		(32	)		(98	)		(98	)
Net other postretirement             benefit expense	$	75		$	75		$	228		$	225

The Company previously disclosed in its consolidated financial statements for the year ended December 31, 2003 that it expects to contribute $0.9 million, $0.1 million and $0.1 million to the Employee Pension Plan, Outside Director Pension Plan and Other Post Retirement Benefit Plans, respectively, during the year ended December 31, 2004. As of September 30, 2004, the Company has contributed $859,000 to the Employee Pension Plan, $75,000 to the Outside Director Plan, and $70,000 to the Other Postretirement Benefit Plans. As of September 30, 2004, the Company has not revised its expected contributions for the year ending December 31, 2004 for any of these plans.

-8-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations

GENERAL

Flushing Financial Corporation, a Delaware corporation (the "Holding Company"), was organized in May 1994 to serve as the holding company for Flushing Savings Bank, FSB (the "Bank"), a federally chartered, FDIC insured savings institution, originally organized in 1929. The Bank is a consumer-oriented savings institution and conducts its business through eleven banking offices located in Queens, Brooklyn, Manhattan, Bronx and Nassau County. The Bank has taken steps to close the banking office located in the Bronx during the fourth quarter of 2004. Upon completion, this closing will reduce the number of branches to ten, and the deposits held at this location will be transferred to the main branch in Flushing, Queens. The Holding Company does not anticipate that the closing of this branch will have a material effect on its financial condition or results of operations. Flushing Financial Corporation's common stock is publicly traded on the Nasdaq National Market under the symbol "FFIC". The following discussion of financial condition and results of operations includes the collective results of the Holding Company and the Bank (collectively, the "Company"), but reflects principally the Bank's activities.

The Company's principal business is attracting retail deposits from the general public and investing those deposits, together with funds generated from operations and borrowings, primarily in (1) origination and purchases of one-to-four family (focusing on mixed-use properties - properties that contain both residential dwelling units and commercial units), multi-family residential and commercial real estate mortgage loans; (2) mortgage loan surrogates such as mortgage-backed securities; and (3) U.S. government and federal agency securities, corporate fixed-income securities and other marketable securities. To a lesser extent, the Company originates certain other loans, including construction loans, Small Business Administration loans and other small business and consumer loans.

The Company's results of operations depend primarily on net interest income, which is the difference between the income earned on its interest-earning assets and the cost of its interest-bearing liabilities. Net interest income is the result of the Company's interest rate margin, which is the difference between the average yield earned on interest-earning assets and the average cost of interest-bearing liabilities, adjusted for the difference in the average balance of interest-earning assets as compared to the average balance of interest-bearing liabilities. The Company also generates non-interest income from loan fees, service charges on deposit accounts and other fees, income earned on Bank Owned Life Insurance, dividends on Federal Home Loan Bank of NY ("FHLB-NY") stock and net gains and losses on sales of securities and loans. The Company's operating expenses consist principally of employee compensation and benefits, occupancy and equipment costs, other general and administrative expenses and income tax expense. The Company's results of operations also can be significantly affected by its periodic provision for loan losses and specific provision for losses on real estate owned. However, the Company has not recorded a provision for possible loan losses since 1999. Such results also are significantly affected by general economic and competitive conditions, including changes in market interest rates, the strength of the local economy, government policies and actions of regulatory authorities.

Statements contained in this Quarterly Report relating to plans, strategies, objectives, economic performance and trends, projections of results of specific activities or investments and other statements that are not descriptions of historical facts may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, the factors set forth in the preceding paragraph and elsewhere in this Quarterly Report, and in other documents filed by the Company with the Securities and Exchange Commission from time to time, including, without limitation, the Company's Annual Report on Form 10-K for the year ended December 31, 2003. Forward-looking statements may be identified by terms such as "may", "will", "should", "could", "expects", "plans", "intends", "anticipates", "believes", "estimates", "predicts", "forecasts", "potential" or "continue" or similar terms or the negative of these terms. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. The Company has no obligation to update these forward-looking statements.

-9-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations

COMPARISON OF OPERATING RESULTS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

General. Diluted earnings per share increased $0.04, or 12.9%, to $0.35 for the three months ended September 30, 2004 from $0.31 for the three months ended September 30, 2003. Net income increased $0.7 million, or 13.4%, to $6.3 million for the three months ended September 30, 2004 from $5.5 million for the three months ended September 30, 2003. The return on average assets for the three months ended September 30, 2004 increased to 1.25% compared to 1.20% for the three months ended September 30, 2003, while the return on average equity for the three months ended September 30, 2004 increased to 16.57% from 16.28% for the three months ended September 30, 2003.

Interest Income. Total interest and dividend income increased $1.9 million, or 6.7%, to $30.0 million for the three months ended September 30, 2004 from $28.1 million for the three months ended September 30, 2003. This increase was primarily the result of a $181.3 million increase in the average balance of interest-earning assets for the three months ended September 30, 2004 as compared to the three months ended September 30, 2003. The average balance of higher-yielding mortgage loans, net increased $194.0 million while the average balance of lower-yielding mortgage-backed securities and other securities decreased $18.8 million and $2.8 million, respectively, for the three months ended September 30, 2004 as compared to the three months ended September 30, 2003. The yield on interest-earning assets declined 22 basis points to 6.27% for the three months ended September 30, 2004 from 6.49% for the three months ended September 30, 2003. This decrease is primarily due to the declining interest rate environment experienced during the past three years, the effect of which further lowered the yield on assets during the third quarter of 2004. However, short-term rates have now increased approximately 75 basis points since the first quarter of 2004. Long-term rates, after rising briefly, have returned to their levels at the beginning of the year. We continued our focus on the origination of higher yielding multi-family residential and commercial real estate mortgage loans, along with the origination of one-to-four family mixed-use property mortgage loans, which allowed us to maintain a higher yield on our loan portfolio than we would have otherwise experienced. The yield on mortgage loans reflects the high refinancing activity that has taken place during the current quarter and preceding two years. The Bank's existing borrowers have been refinancing their higher costing mortgage loans at lower rates, which have resulted in a reduction on the yield of the mortgage portfolio. However, this decrease has been partially offset by prepayment penalties that have been collected. In addition, the Bank's current strategy includes moving funds from the lower-yielding mortgage-backed securities and other securities portfolios into the higher-yielding mortgage loan portfolio.

Interest Expense. Interest expense increased $0.2 million, or 1.7%, to $13.2 million for the three months ended September 30, 2004 from $12.9 million for the three months ended September 30, 2003, primarily due to a $153.2 million increase in the average balance of interest-bearing liabilities. This was partially offset by a 22 basis point decline in the cost of interest-bearing liabilities to 2.94% in the three months ended September 30, 2004 from 3.16% in the three months ended September 30, 2003. The decrease in the cost of funds is primarily due to the declining interest rate environment experienced during the past three years, the effect of which further lowered the cost of funds in the third quarter of 2004.

Net Interest Income. For the three months ended September 30, 2004, net interest income increased $1.7 million, or 11.0%, to $16.9 million from $15.2 million in the three months ended September 30, 2003. This increase in net interest income is primarily due to a $181.3 million increase in the average balance of interest-earning assets, as the net interest spread was 3.33% for the three months ended September 30, 2004, the same as that for the three months ended September 30, 2003. The net interest margin increased 2 basis points to 3.53% for the three months ended September 30, 2004 from 3.51% for the three months ended September 30, 2003, due an increase of $28.1 million in the amount by which average interest-earning assets exceeds average interest-bearing liabilities. However, the net interest margin of 3.53% for the three months ended September 30, 2004 remained the same as that for the three months ended June 30, 2004.

> -10-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations

Provision for Loan Losses. There was no provision for loan losses for the three-month periods ended September 30, 2004 and 2003. In assessing the adequacy of the Company's allowance for loan losses, management considers the Company's historical loss experience, recent trends in losses, collection policies and collection experience, trends in the volume of non-performing loans, changes in the composition and volume of the gross loan portfolio, and local and national economic conditions. Based on these reviews, no provision for loan losses was deemed necessary for either of the three-month periods ended September 30, 2004 and 2003.

Non-Interest Income. Non-interest income was $1.5 million for the three months ended September 30, 2004, a decrease of $0.1 million from the $1.7 million for the three months ended September 30, 2003. This decrease is attributable to the reduction in dividends on Federal Home Loan Bank of New York ("FHLB-NY") stock, which decreased $0.2 million for the three months ended September 30, 2004 from the three months ended September 30, 2003.

Non-Interest Expense. Non-interest expense was $8.1 million for the three months ended September 30, 2004, an increase of $0.2 million, or 2.8%, from $7.9 million for the three months ended September 30, 2003. The increase from the prior year period is primarily attributable to the Bank's continued focus on expanding its current product offerings to enhance its ability to serve its customers, including increases in personnel to provide these services, and, in the fourth quarter of 2003, the opening of a new branch in Astoria, Queens. Management continues to monitor expenditures resulting in efficiency ratios of 44.3% and 47.1% for the three months ended September 30, 2004 and 2003, respectively.

Income before Income Taxes. Income before the provision for income taxes increased $1.3 million, or 14.8%, to $10.3 million for the three months ended September 30, 2004 as compared to $8.9 million for the three months ended September 30, 2003, for the reasons discussed above.

Provision For Income Taxes. Income tax expense was $4.0 million for the three months ended September 30, 2004 compared to $3.4 million for the three months ended September 30, 2003. This increase is primarily due to the $1.3 million increase in income before income taxes, combined with a slight increase in the effective tax rate. The effective tax rate was 39.00% for the three months ended September 30, 2004 compared to 38.27% for the three months ended September 30, 2003.

COMPARISON OF OPERATING RESULTS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

General. Diluted earnings per share increased 7.8% to $0.97 for the nine months ended September 30, 2004 from $0.90 for the nine months ended September 30, 2003. Net income for the nine months ended September 30, 2004 increased $1.7 million, or 10.9%, to $17.6 million from the $15.9 million reported for the nine months ended September 30, 2003. The return on average assets for the nine months ended September 30, 2004 was 1.18% compared to 1.19% for the nine months ended September 30, 2003, while the return on average equity for the nine months ended September 30, 2004 was 15.67% compared to 15.70% for the nine months ended September 30, 2003.

The nine-month period ended September 30, 2004 includes a charge to earnings of $1.1 million, $0.7 million on an after-tax basis or $0.04 per diluted share, relating to an adjustment of compensation expense for certain of the Company's restricted stock awards and supplemental retirement benefits to reflect that certain participants under these plans have reached, or are close to reaching, retirement eligibility, at which time such awards will be fully vested. This charge was recorded in the first quarter of 2004. Although this adjustment relates to prior periods, the amount of the charge attributable to any prior year would not have been material to the Company's financial condition or results of operations as reported for that year.

-11-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations

Interest Income. Total interest and dividend income increased $5.4 million, or 6.5%, to $88.7 million for the nine months ended September 30, 2004 from $83.3 million for the nine months ended September 30, 2003. This increase was primarily the result of a $231.6 million increase in the average balance of interest-earning assets for the nine months ended September 30, 2004 as compared to the nine months ended September 30, 2003. The average balance of total loans, net, mortgage-backed securities and other securities increased $163.5 million, $63.2 million and $7.4 million, respectively, for the nine months ended September 30, 2004 as compared to the nine months ended September 30, 2003. These increases were partially offset by a $2.6 million decrease in the average balance of interest-earning deposits and federal funds sold for the nine months ended September 30, 2004 compared to the nine months ended September 30, 2003. The yield on interest-earning assets declined 43 basis points to 6.25% for the nine months ended September 30, 2004 from 6.68% for the nine months ended September 30, 2003. This decrease is primarily due to the declining interest rate environment experienced during the past three years, the effect of which further lowered the yield on assets during the first nine months of 2004. However, short-term rates have now increased approximately 75 basis points since the first quarter of 2004. Long-term rates, after rising briefly, have returned to their levels at the beginning of the year. Our focus on the origination of higher yielding multi-family residential and commercial real estate mortgage loans, along with the origination of one-to-four family mixed-use property mortgage loans, allowed us to maintain a higher yield on our loan portfolio than we would have otherwise experienced. The yield on mortgage loans reflects the high refinancing activity that has taken place during the nine month period ended September 30, 2004 and the preceding two years. The Bank's existing borrowers have been refinancing their higher costing mortgage loans at lower rates, which have resulted in a reduction on the yield of the mortgage portfolio. However, this decrease has been partially offset by prepayment penalties that have been collected. In addition, the increase in the average balance of the securities portfolio, while increasing interest income, reduced the yield on total interest-earning assets. The Bank's current strategy includes reducing the lower-yielding mortgage-backed securities portfolio and shifting these funds to the higher-yielding mortgage loan portfolio.

Interest Expense. Interest expense decreased $0.9 million, or 2.2%, to $38.5 million for the nine months ended September 30, 2004 from $39.4 million for the nine months ended September 30, 2003, primarily due to a 46 basis point decline in the cost of interest-bearing liabilities to 2.89% in the nine months ended September 30, 2004 from 3.35% in the nine months ended September 30, 2003. This decrease was partially offset by a $206.7 million increase in the average balance of interest-bearing liabilities. The decrease in the cost of funds is primarily due to the declining interest rate environment experienced during the past three years, the effect of which further lowered the cost of funds during the first nine months of 2004. This was coupled with an increase in the average balance of lower costing core deposits.

Net Interest Income. For the nine months ended September 30, 2004, net interest income increased $6.3 million, or 14.4%, to $50.1 million from $43.8 million in the nine months ended September 30, 2003. This increase in net interest income is primarily due to a $231.6 million increase in the average balance of interest-earning assets, combined with a three basis point improvement in the net interest spread and an increase of $24.9 million in the amount by which average interest-earning assets exceed average interest-bearing liabilities. The net interest margin increased one basis point to 3.53% for the nine months ended September 30, 2004 from 3.52% for the nine months ended September 30, 2003, due to the increase in the net interest spread and the increase in the amount by which average interest-earning assets exceeds average interest-bearing liabilities, partially offset by the increase in the average balance of interest-earning assets.

Provision for Loan Losses. There was no provision for loan losses for the nine-month periods ended September 30, 2004 and 2003. In assessing the adequacy of the Company's allowance for loan losses, management considers the Company's historical loss experience, recent trends in losses, collection policies and collection experience, trends in the volume of non-performing loans, changes in the composition and volume of the gross loan portfolio, and local and national economic conditions. Based on these reviews, no provision for loan losses was deemed necessary for either of the nine-month periods ended September 30, 2004 and 2003.

Non-Interest Income. Non-interest income decreased $0.3 million, or 6.0%, to $4.6 million for the nine months ended September 30, 2004 from $4.9 million for the nine months ended September 30, 2003. Loan fees and banking services fees increased $0.3 million for the nine months ended September 30, 2004 compared to the nine months ended September 30, 2003. This was more than offset by the reduction in dividends on Federal Home Loan Bank of New York ("FHLB-NY") stock, which decreased $0.6 million for the nine months ended September 30, 2004 from the nine months ended September 30, 2003.

-12-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations

Non-Interest Expense. Non-interest expense was $25.9 million for the nine months ended September 30, 2004, an increase of $2.9 million, or 12.5%, from $23.1 million for the nine months ended September 30, 2003. Salaries and employee benefits and other operating expenses increased $0.9 million and $0.2 million, respectively, as a result of the adjustment to amortization of compensation expense for certain of the Company's restricted stock awards and supplemental retirement benefits during the first quarter of 2004, and the expensing of certain restricted stock unit awards at the time of grant during the second quarter of 2004 to reflect that certain participants under these plans have reached, or are close to reaching, retirement eligibility, at which time such awards will be fully vested. The nine months ended September 30, 2004 also includes increased professional service fees due to costs incurred to comply with the Sarbanes-Oxley Act. The remaining increase from the prior year period is primarily attributable to the Bank's continued focus on expanding its current product offerings to enhance its ability to serve its customers, including increases in personnel to provide these services, and, in the fourth quarter of 2003, the opening of a new branch in Astoria, Queens. Management continues to monitor expenditures resulting in an efficiency ratio of 47.4% and 47.3% for the nine-month periods ended September 30, 2004 and 2003, respectively.

Income before Income Taxes. Income before the provision for income taxes increased $3.1 million, or 12.2%, to $28.8 million for the nine months ended September 30, 2004 as compared to $25.7 million for the nine months ended September 30, 2003, for the reasons discussed above.

Provision For Income Taxes. Income tax expense was $11.2 million for the nine months ended September 30, 2004 an increase of $1.4 million, or 14.4%, compared to $9.8 million for the nine months ended September 30, 2003. This increase is primarily due to the $3.1 million increase in income before income taxes, combined with a slight increase in the effective tax rate. The effective tax rate was 39.00% for the nine months ended September 30, 2004 compared to 38.25% for the nine months ended September 30, 2003.

-13-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations

FINANCIAL CONDITION

Assets. Total assets at September 30, 2004 were $2,038.0 million, a $127.2 million increase from December 31, 2003. Total loans, net increased $191.2 million during the nine months ended September 30, 2004 to $1,460.7 million from $1,269.5 million at December 31, 2003.

The following table shows loan originations and purchases for the period indicated.

	For the three months				For the nine months
	ended September 30,				ended September 30,
	2004		2003		2004		2003
	(in thousands)
Multi-family residential	$	58,053	$	39,120	$	158,058	$	124,435
Commercial real estate		22,436		28,613		71,384		72,254
One-to-four family - mixed-use property		36,454		22,855		104,186		58,382
One-to-four family - residential		6,501		3,511		14,743		15,166
Construction		8,846		3,304		19,163		12,792
Co-operative apartment		75		--		302		35
Commercial business and other loans		3,894		2,004		11,916		7,656
Total	$	136,259	$	99,407	$	379,752	$	290,720

As the Company continues to increase its loan portfolio, management continues to adhere to the Bank's strict underwriting standards. As a result, the Company has been able to minimize charge-offs of losses from impaired loans and maintain asset quality. Non-performing assets were $4.5 million at September 30, 2004 compared to $0.7 million at December 31, 2003 and $1.7 million at September 30, 2003. The increase in non-performing assets at September 30, 2004 is attributed to two mortgages secured by commercial properties. The borrower is negotiating the sale of these properties. The Company believes it has a secure position in these two loans, and does not anticipate a significant loss, if any, will be incurred. Total non-performing assets as a percentage of total assets were 0.22% at September 30, 2004, 0.04% at December 31, 2003, and 0.09% at September 30, 2003. The ratio of allowance for loan losses to total non-performing loans was 146% at September 30, 2004 compared to 961% at December 31, 2003 and 387% at September 30, 2003.

During the first nine months of 2004, mortgage-backed securities decreased $58.4 million to $421.0 million while other securities decreased $14.9 million to $41.4 million. The funds obtained from the repayment and sale of mortgage-backed securities and other securities have been used to originate higher yielding mortgage loans. Other securities primarily consists of securities issued by government agencies and mutual or bond funds that invest in government and government agency securities. At September 30, 2004, loans in process totaled $174.1 million.

Liabilities. Total liabilities increased $117.5 million to $1,881.5 million at September 30, 2004 from $1,764.0 million at December 31, 2003. Due to depositors increased $107.3 million as certificate of deposit accounts increased $97.8 million while lower costing core deposits increased $9.5 million. Borrowed funds decreased $3.4 million during the nine months ended September 30, 2004, as asset growth was funded by deposit growth.

-14-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations

Equity. Total stockholders' equity increased $9.7 million to $156.4 million at September 30, 2004 from $146.8 million at December 31, 2003. Net income of $17.6 million for the nine months ended September 30, 2004 was partially offset by $7.9 million in treasury shares purchased through the Company's stock repurchase programs, a net after-tax decrease of $1.5 million in the market value of securities available for sale, and $4.6 million in cash dividends paid during the nine month period. In addition, the exercise of stock options increased stockholders' equity by $5.1 million, including the income tax benefit realized by the Company upon the exercise of stock options. Book value per share was $8.16 at September 30, 2004 compared to $7.61 per share at December 31, 2003 and $7.34 per share at September 30, 2003.

Under its stock repurchase programs, the Company repurchased 448,600 shares during the nine months ended September 30, 2004, at a total cost of $7.9 million, or an average of $17.67 per share. During the third quarter of 2004, the Company completed its eleventh stock repurchase program and announced the approval of a new stock repurchase program authorizing the purchase of an additional 1,000,000 shares. At September 30, 2004, 991,350 shares remain to be repurchased under the current stock repurchase program. Through September 30, 2004, the Company had repurchased approximately 46% of the common shares issued in connection with the Company's initial public offering at a cost of $107.8 million.

Cash flow. During the nine months ended September 30, 2004, funds provided by the Company's operating activities amounted to $22.6 million. These funds, together with $102.3 million provided by financing activities and funds available at the beginning of the year, were utilized to fund net investing activities of $118.1 million. The Company's primary business objective is the origination and purchase of one-to-four family (primarily mixed-use properties), multi-family and commercial real estate loans. During the nine months ended September 30, 2004, the net total of loan originations less loan repayments was $193.4 million. The Company also invests in other securities including mortgage loan surrogates such as mortgage-backed securities. During the nine months ended September 30, 2004, the Company purchased a total of $102.2 million in securities available for sale. Funds for investment were also provided by $174.6 million in maturities, prepayments, calls and sales of securities available for sale. Additional funds of $2.5 million were provided through the exercise of stock options. The Company also used funds of $8.4 million for treasury stock purchases and $4.6 million in dividend payments during the nine months ended September 30, 2004.

-15-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations

INTEREST RATE RISK

The consolidated statements of financial condition have been prepared in conformity with generally accepted accounting principles in the United States of America, which require the measurement of financial condition and operating results in terms of historical dollars without considering the changes in fair value of certain investments due to changes in interest rates. Generally, the fair value of financial investments such as loans and securities fluctuates inversely with changes in interest rates. As a result, increases in interest rates could result in decreases in the fair value of the Company's interest-earning assets which could adversely affect the Company's results of operation if such assets were sold, or, in the case of securities classified as available-for-sale, decreases in the Company's stockholders' equity, if such securities were retained.

The Company manages the mix of interest-earning assets and interest-bearing liabilities on a continuous basis to maximize return and adjust its exposure to interest rate risk. On a quarterly basis, management prepares the "Earnings and Economic Exposure to Changes in Interest Rate" report for review by the Board of Directors, as summarized below. This report quantifies the potential changes in net interest income and net portfolio value should interest rates go up or down (shocked) 300 basis points, assuming the yield curves of the rate shocks will be parallel to each other. Net portfolio value is defined as the market value of assets net of the market value of liabilities. The market value of assets and liabilities is determined using a discounted cash flow calculation. The net portfolio value ratio is the ratio of the net portfolio value to the market value of assets. All changes in income and value are measured as percentage changes from the projected net interest income and net portfolio value at the base interest rate scenario. The base interest rate scenario assumes interest rates at September 30, 2004. Various estimates regarding prepayment assumptions are made at each level of rate shock. Actual results could differ significantly from these estimates. The Company is within the guidelines set forth by the Board of Directors for each interest rate level.

	Projected Percentage Change In
	Net Interest						Net Portfolio
Change in Interest Rate	Income			Net Portfolio Value			Value Ratio
-300 Basis points		-24.53	%		-29.17	%		7.32	%
-200 Basis points		-9.41			-12.84			9.05
-100 Basis points		-2.74			-2.76			10.20
Base interest rate		--			--			10.66
+100 Basis points		-2.31			-5.90			10.27
+200 Basis points		-5.90			-15.21			9.51
+300 Basis points		-10.96			-25.65			8.57

-16-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations

REGULATORY CAPITAL POSITION

Under Office of Thrift Supervision ("OTS") capital regulations, the Bank is required to comply with each of three separate capital adequacy standards. At September 30, 2004, the Bank exceeded each of the three OTS capital requirements and is categorized as "well-capitalized" by the OTS under the prompt corrective action regulations. Set forth below is a summary of the Bank's compliance with OTS capital standards as of September 30, 2004.

(Dollars in thousands)	Amount		Percent of Assets
Tangible Capital:
Capital level	$	155,258		7.67	%
Requirement		30,355		1.50
Excess		124,903		6.17
Leverage and Core Capital:
Capital level	$	155,258		7.67	%
Requirement		60,711		3.00
Excess		94,547		4.67
Risk-Based Capital:
Capital level	$	161,804		13.87	%
Requirement		93,345		8.00
Excess		68,459		5.87

-17-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations

AVERAGE BALANCES

Net interest income represents the difference between income on interest-earning assets and expense on interest-bearing liabilities. Net interest income depends upon the relative amount of interest-earning assets and interest-bearing liabilities and the interest rate earned or paid on them. The following table sets forth certain information relating to the Company's consolidated statements of financial condition and consolidated statements of operations for the three-month periods ended September 30, 2004 and 2003, and reflects the average yield on assets and average cost of liabilities for the periods indicated. Such yields and costs are derived by dividing income or expense by the average balance of assets or liabilities, respectively, for the periods shown. Average balances are derived from average daily balances. The yields include amortization of fees which are considered adjustments to yields.

	For the three months ended September 30,
	2004							2003
	Average				Average			Average				Average
(Dollars in thousands)	Balance		Interest		Yield/Cost			Balance		Interest		Yield/Cost
Assets
Interest-earning assets:
Mortgage loans, net (1)	$	1,402,672	$	24,868		7.09	%	$	1,208,638	$	23,328		7.72	%
Other loans, net (1)		14,225		209		5.88			9,361		132		5.64
Total loans, net		1,416,897		25,077		7.08			1,217,999		23,460		7.70
Mortgage-backed securities		432,856		4,507		4.16			451,649		4,242		3.76
Other securities		44,390		377		3.40			47,188		389		3.30
Total securities		477,246		4,884		4.09			498,837		4,631		3.71
Interest-earning deposits and
federal funds sold		20,179		61		1.21			16,148		34		0.84
Total interest-earning              assets		1,914,322		30,022		6.27			1,732,984		28,125		6.49
Other assets		93,082							110,183
Total assets	$	2,007,404						$	1,843,167
Liabilities and Equity
Interest-bearing liabilities:
Passbook accounts	$	219,083		275		0.50		$	220,425		310		0.56
NOW accounts		43,839		54		0.49			40,995		57		0.56
Money market accounts		262,651		1,093		1.66			238,919		1,135		1.90
Certificate of deposit           accounts		662,088		5,812		3.51			573,865		5,179		3.61
Total due to depositors		1,187,661		7,234		2.44			1,074,204		6,681		2.49
Mortgagors' escrow           deposits		18,062		13		0.29			11,921		13		0.44
Total deposits		1,205,723		7,247		2.40			1,086,125		6,694		2.47
Borrowed funds		585,560		5,903		4.03			551,954		6,233		4.52
Total interest-bearing
liabilities		1,791,283		13,150		2.94			1,638,079		12,927		3.16
Non-interest bearing deposits		46,616							37,048
Other liabilities		18,484							32,521
Total liabilities		1,856,383							1,707,648
Equity		151,021							135,519
Total liabilities              and equity	$	2,007,404						$	1,843,167
Net interest income    /net interest spread			$	16,872		3.33	%			$	15,198		3.33	%
Net interest-earning assets /
Net interest margin	$	123,039				3.53	%	$	94,905				3.51	%
Ratio of interest-earning    assets to    interest-bearing liabilities						1.07	x						1.06	x

(1)    Loan interest income includes loan fee income (which includes net amortization of deferred fees and costs, late charges, and prepayment penalties) of approximately $1.6 million and $1.4 million for the three-month periods ended September 30, 2004 and 2003, respectively.

-18-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations

AVERAGE BALANCES (continued)

The following table sets forth certain information relating to the Company's consolidated statements of financial condition and consolidated statements of operations for the nine-month periods ended September 30, 2004 and 2003, and reflects the average yield on assets and average cost of liabilities for the periods indicated. Such yields and costs are derived by dividing income or expense by the average balance of assets or liabilities, respectively, for the periods shown. Average balances are derived from average daily balances. The yields include amortization of fees which are considered adjustments to yields.

	For the nine months ended September 30,
	2004							2003
	Average				Average			Average				Average
(Dollars in thousands)	Balance		Interest		Yield/Cost			Balance		Interest		Yield/Cost
Assets
Interest-earning assets:
Mortgage loans, net (1)	$	1,347,379	$	72,401		7.16	%	$	1,186,687	$	69,276		7.78	%
Other loans, net (1)		11,436		522		6.09			8,678		411		6.31
Total loans, net		1,358,815		72,923		7.16			1,195,365		69,687		7.77
Mortgage-backed securities		459,637		14,210		4.12			396,402		12,179		4.10
Other securities		56,755		1,431		3.36			49,307		1,245		3.37
Total securities		516,392		15,641		4.04			445,709		13,424		4.02
Interest-earning deposits and
federal funds sold		17,092		124		0.97			19,666		151		1.02
Total interest-earning              assets		1,892,299		88,688		6.25			1,660,740		83,262		6.68
Other assets		95,605							110,519
Total assets	$	1,987,904						$	1,771,259
Liabilities and Equity
Interest-bearing liabilities:
Passbook accounts	$	218,828		819		0.50		$	217,407		1,339		0.82
NOW accounts		43,340		162		0.50			39,754		203		0.68
Money market accounts		283,922		3,869		1.82			218,534		3,448		2.10
Certificate of deposit           accounts		625,219		16,307		3.48			564,317		15,664		3.70
Total due to depositors		1,171,309		21,157		2.41			1,040,012		20,654		2.65
Mortgagors' escrow           deposits		19,494		37		0.25			14,243		49		0.46
Total deposits		1,190,803		21,194		2.37			1,054,255		20,703		2.62
Borrowed funds		584,833		17,350		3.96			514,672		18,727		4.85
Total interest-bearing
liabilities		1,775,636		38,544		2.89			1,568,927		39,430		3.35
Non-interest bearing deposits		44,317							35,503
Other liabilities		18,372							32,121
Total liabilities		1,838,325							1,636,551
Equity		149,579							134,708
Total liabilities              and equity	$	1,987,904						$	1,771,259
Net interest income    /net interest spread			$	50,144		3.36	%			$	43,832		3.33	%
Net interest-earning assets /
Net interest margin	$	116,663				3.53	%	$	91,813				3.52	%
Ratio of interest-earning    assets to    interest-bearing liabilities						1.07	x						1.06	x

(2)    Loan interest income includes loan fee income (which includes net amortization of deferred fees and costs, late charges, and prepayment penalties) of approximately $3.8 million and $3.1 million for the nine-month periods ended September 30, 2004 and 2003, respectively.

-19-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations

LOANS

The following table sets forth the Company's loan originations (including the net effect of refinancing) and the changes in the Company's portfolio of loans, including purchases, sales and principal reductions for the periods indicated.

	Nine months ended
(In thousands)	September 30, 2004		September 30, 2003
Mortgage Loans
At beginning of period	$	1,264,219	$	1,166,192
Mortgage loans originated:
Multi-family residential		158,058		124,435
Commercial real estate		71,384		72,254
One-to-four family - mixed-use property		104,186		58,192
One-to-four family - residential		14,743		14,574
Construction		19,163		12,792
Co-operative apartment		302		35
Total mortgage loans originated		367,836		282,282
Mortgage loans purchased:
One-to-four family - residential		--		592
One-to-four family - mixed-use property		--		190
Commercial real estate		--		--
Total acquired loans		--		782
Less:
Principal and other reductions		177,149		210,897
Sales		5,424		9,501
Mortgage loan foreclosures		--		--
At end of period	$	1,449,482	$	1,228,858
Other Loans
At beginning of period	$	9,825	$	8,486
Other loans originated:
Small Business Administration		2,788		3,728
Small business		7,313		1,484
Other		1,815		2,444
Total other loans originated		11,916		7,656
Less:
Sales		1,518		3,079
Principal and other reductions		6,622		4,985
At end of period	$	13,601	$	8,078

-20-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations

NON-PERFORMING ASSETS

The Company reviews loans in its portfolio on a monthly basis to determine whether any problem loans require classification in accordance with internal policies and applicable regulatory guidelines. The following table sets forth information regarding all non-accrual loans, loans which are 90 days or more delinquent, and real estate owned at the dates indicated.

(Dollars in thousands)	September 30, 2004			December 31, 2003
Non-accrual mortgage loans	$	4,273		$	525
Other non-accrual loans		218			157
Total non-accrual loans		4,491			682
Mortgage loans 90 days or more delinquent      and still accruing		--			--
Other loans 90 days or more delinquent      and still accruing		--			--
Total non-performing loans		4,491			682
Real estate owned (foreclosed real estate)		--			--
Investment securities		--			--
Total non-performing assets	$	4,491		$	682
Non-performing loans to gross loans		0.31	%		0.05	%
Non-performing assets to total assets		0.22	%		0.04	%

-21-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations

ALLOWANCE FOR LOAN LOSSES

The Company has established and maintains on its books an allowance for loan losses that is designed to provide a reserve against estimated losses inherent in the Company's overall loan portfolio. The allowance is established through a provision for loan losses based on management's evaluation of the risk inherent in the various components of its loan portfolio and other factors, including historical loan loss experience, changes in the composition and volume of the portfolio, collection policies and experience, trends in the volume of non-accrual loans and regional and national economic conditions. The determination of the amount of the allowance for loan losses includes estimates that are susceptible to significant changes due to changes in appraisal values of collateral, national and regional economic conditions and other factors. In connection with the determination of the allowance, the market value of collateral ordinarily is evaluated by the Company's staff appraiser; however, the Company may from time to time obtain independent appraisals for significant properties. Current year charge-offs, charge-off trends, new loan production and current balance by particular loan categories are also taken into account in determining the appropriate amount of allowance. The Board of Directors reviews and approves the adequacy of the loan loss reserves on a quarterly basis.

The following table sets forth the activity in the Bank's allowance for loan losses for the periods indicated.

	Nine months ended
(Dollars in thousands)	September 30, 2004			September 30, 2003
Balance at beginning of period	$	6,553		$	6,581
Provision for loan losses		--			--
Loans charged-off:
One-to-four family residential real estate		--			--
Co-operative apartment		--			--
Multi-family residential		--			--
Commercial real estate		--			--
Construction		--			--
Commercial business and other		(9	)		(153	)
Total loans charged-off		(9	)		(153	)
Recoveries:
Mortgage loans		2			124
Commercial business and other		--			2
Total recoveries		2			126
Net charge-offs		(7	)		(27	)
Balance at end of period	$	6,546		$	6,554
Ratio of net charge-offs during the period     to average loans outstanding     during the period		0.00	%		0.00	%
Ratio of allowance for loan losses     to loans at end of period		0.45	%		0.53	%
Ratio of allowance for loan losses     to non-performing assets at end of period		145.76	%		386.99	%
Ratio of allowance for loan losses     to non-performing loans at end of period		145.76	%		386.99	%

-22-

PART I - FINANCIAL INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For a discussion of the qualitative and quantitative disclosures about market risk, see the information under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations - Interest Rate Risk".

ITEM 4.    CONTROLS AND PROCEDURES

The Company carried out, under the supervision and with the participation of the Company's management, including its Chief Executive Officer and Chief Financial Officer, an evaluation of the effectiveness of the design and operation of the Company's disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this Quarterly Report. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of September 30, 2004, the design and operation of these disclosure controls and procedures were effective. During the period covered by this Quarterly Report, there have been no changes in the Company's internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS.

The Company is a defendant in various lawsuits. Management of the Company, after consultation with outside legal counsel, believes that the resolution of these various matters will not result in any material adverse effect on the Company's consolidated financial condition, results of operations and cash flows.

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

The following table sets forth information regarding the shares of common stock repurchased by the Company during the quarter ended September 30, 2004.

							Maximum
					Total Number of		Number of
					Shares Purchased as		Shares that May
	Total Number				Part of Publicly		Yet Be Purchased
	of Shares		Average Price		Announced Plans or		Under the Plans
Period	Purchased		Paid per Share		Programs		or Program
July 1 to July 31, 2004		11,412		17.35		9,500		214,250
August 1 to August 31, 2004		182,900		17.58		182,900		1,031,350
September 1 to September 30, 2004		40,000		18.55		40,000		991,350
Total		234,312		17.74		232,400		991,350

The above table includes 1,912 common shares the Company withheld from employees, valued at an average price per share of $17.25, to satisfy tax withholding obligations due upon vesting of restricted stock awards.

The current common stock repurchase program was approved by the Company's Board of Directors on August 17, 2004. This repurchase program authorized the repurchase of 1,000,000 common shares. The repurchase program does not have an expiration date or a maximum dollar amount that may be paid to repurchase the common shares. Stock repurchases under this program will be made from time to time, on the open market or in privately negotiated transactions, at the discretion of the management of the Company.

ITEM 3.    DEFAULTS UPON SENIOR SECURITIES.

Not applicable.

-23-

PART II - OTHER INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

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

Not applicable.

ITEM 5.    OTHER INFORMATION.

Not applicable.

-24-

PART II - OTHER INFORMATION

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES

ITEM 6.    EXHIBITS.

Exhibit 3.1	Certificate of Incorporation of Flushing Financial Corporation (1)
Exhibit 3.2	Certificate of Amendment of Certificate of Incorporation of Flushing Financial Corporation (3)
Exhibit 3.3	Certificate of Designations of Series A Junior Participating Preferred Stock of Flushing Financial Corporation (4)
Exhibit 3.4	By-Laws of Flushing Financial Corporation (1)
Exhibit 4.1	Rights Agreement, dated as of September 17, 1996, between Flushing Financial Corporation and State Street Bank and Trust Company, as Rights Agent (2)
Exhibit 31.1	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Executive Officer.
Exhibit 31.2	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Financial Officer.
Exhibit 32.1	Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by the Chief Executive Officer
Exhibit 32.2	Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by the Chief Financial Officer

(1)	Incorporated by reference to Exhibits filed with the Registration Statement on Form S-1, Registration NO.33-96488.
(2)	Incorporated by reference to Exhibits filed with Form 8-K filed September 30, 1996.
(3)	Incorporated by reference to Exhibits filed with Form S-8 filed May 31, 2002.
(4)	Incorporated by reference to Exhibits filed with Form 10-Q for the quarter ended September 30, 2002.

-25-

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
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 thereunto duly authorized.

	Flushing Financial Corporation,
Dated: November 4, 2004	By: /s/Michael J. Hegarty
	Michael J. Hegarty
	President and Chief Executive Officer
Dated: November 4, 2004	By: /s/David W. Fry
	David W. Fry
	Senior Vice President, Treasurer and
	Chief Financial Officer

-26-

FLUSHING FINANCIAL CORPORATION and SUBSIDIARIES
EXHIBIT INDEX

Exhibit No.	Description
3.1	Certificate of Incorporation of Flushing Financial Corporation (1)
3.2	Certificate of Amendment of Certificate of Incorporation of Flushing Financial Corporation (3)
3.3	Certificate of Designations of Series A Junior Participating Preferred Stock of Flushing Financial Corporation(4)
3.4	By-Laws of Flushing Financial Corporation (1)
4.1	Rights Agreement, dated as of September 17, 1996, between Flushing Financial Corporation and State Street Bank and Trust Company, as Rights Agent (2)
31.1	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Executive Officer.
31.2	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Financial Officer.
32.1	Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by the Chief Executive Officer.
32.2	Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by the Chief Financial Officer.

(1)	Incorporated by reference to Exhibits filed with the Registration Statement on Form S-1, Registration No. 33-96488.
(2)	Incorporated by reference to Exhibits filed with Form 8-K filed September 30, 1996.
(3)	Incorporated by reference to Exhibits filed with Form S-8 filed May 31, 2002.
(4)	Incorporated by reference to Exhibits filed with Form 10-Q for the quarter ended September 30, 2002.

-27-