KEARNY FINANCIAL CORP.
                      DIRECTORS INCENTIVE COMPENSATION PLAN

         WHEREAS,  the Corporation has determined that it is advantageous to its
stockholders   that  the  directors  of  the   Corporation   receive   incentive
compensation  as a means of  focusing  their  efforts on  yielding  a  favorable
investment return to the stockholders, and

         WHEREAS,  the  Board of  Directors  ("Board")  of the  Corporation  has
determined that such purposes may best be accomplished through implementation of
the proposed  Kearny  Financial  Corp.  Directors  Incentive  Compensation  Plan
("Plan"), and

         WHEREAS,  at its  meeting  held on  December  5,  2005,  the  Board  of
Directors of the  Corporation  has  authorized  and adopted the Plan,  effective
December 5, 2005,

         NOW  THEREFORE,  BE IT  RESOLVED  that  the Plan  shall be  implemented
effective December 5, 2005, as follows:

         1. Each member of the Board of Directors of the Corporation that is not
otherwise an employee of the Corporation or a subsidiary shall receive a portion
of  his or her  annual  compensation  based  upon  the  annual  return  paid  to
shareholders of the Corporation.  Such level of compensation shall be determined
based upon the cash dividends paid on the Common Stock of the  Corporation  from
time to time and the number of unexercised stock options to purchase Corporation
Common Stock held by such individual ("Participant").

         2. Although it is anticipated  that such  compensation  payable to such
Plan  Participants  shall be paid each time that a cash  dividend is paid on the
Common Stock, the Board reserves the right to amend,  modify,  suspend or cancel
this Plan at any time without prior notice to any  Participants  under the Plan.
No rights or claims for  compensation  or  payment  under the Plan shall vest or
accrue prior to the actual delivery of payment to the Plan Participant.

         3. The Plan shall  provide that upon the payment of a cash  dividend on
the Common Stock, the holder of such options shall receive payment of cash in an
amount equivalent to the cash dividend payable as if such stock options had been
exercised  and such  Common  Stock held as of the  dividend  record  date.  Such
payment of  compensation  based upon stock  options  held shall  expire upon the
expiration or exercise of such underlying options.  Such compensation rights are
non-transferable and shall attach to options whether or not such options held as
of the dividend record date are immediately exercisable.  All options previously
awarded to  non-employee  directors of the  Corporation  shall be  considered in
determination of such compensation rights under the Plan.

         4. All  compensation  payable  under  this  Plan  shall be  subject  to
applicable tax withholding and tax reporting as determined by the Corporation.

         5. All  determinations  regarding  administration  of the Plan shall be
made by the Board of the  Corporation,  or a committee  appointed by such Board,
and such  determinations  of the Board or its committee shall be conclusive with
respect to the Plan.



         IN WITNESS WHEREOF,  the Corporation has caused the Plan to be executed
by its duly authorized representative.


                                              KEARNY FINANCIAL CORP.

December 5, 2005                              By:     /s/ John N. Hopkins
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Date                                                   John N. Hopkins

                                                      Title:   President



December 5, 2005                                      /s/ Sharon Jones
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Date                                                  Secretary