Exhibit 1

VIA FACSIMILE AND FEDERAL EXPRESS

May 8, 2002

Mr. John F. McGill, Jr.
Chairman and Chief Executive Officer
Thistle Group Holdings, Co.
6060 Ridge Avenue
Philadelphia, PA 19128

Dear Mr. McGill:

         Needless to say, the Modified Dutch Auction Tender Offer that was
announced by the Company yesterday at a price below book value is significantly
inadequate.

         I would like to make an offer to the shareholders to purchase the same
number of shares of the Company's common stock at a price range of
$13.50-$14.50, which is subject to being increased after our review of internal
documents. Obviously, to make this opportunity available to the shareholders, we
need your assistance to remove the poison pill, your agreement to assist us in
any required regulatory filings, and reasonable Board representation. I think
that it is important that shareholders be presented with this benefit as soon as
possible. Please contact me if you need further information in order to
implement the program. This offer is subject to regulatory approval.

         Please call me this afternoon or tomorrow at (570) 822-6277, ext.23 to
discuss this matter as I am prepared to move with dispatch.

                                             Sincerely,


                                            Seymour Holtzman

cc: Board of Directors


                                    * * * * *

THE FOREGOING CORRESPONDENCE WITH THISTLE GROUP HOLDINGS, CO. (THE "COMPANY") IS
FILED FOR INFORMATIONAL PURPOSES ONLY AND IS NOT AN OFFER TO BUY OR THE
SOLICITATION OF AN OFFER TO SELL ANY SHARES OF THE COMPANY'S COMMON STOCK. AS
STATED, THE DECISION TO PURSUE ANY POTENTIAL TENDER OFFER WOULD BE SUBJECT TO
SIGNIFICANT PRECONDITIONS REFERRED TO IN SUCH CORRESPONDENCE. MOREOVER,
COMMENCEMENT OF ANY POTENTIAL TENDER OFFER WOULD BE SUBJECT TO, AMONG OTHER
THINGS, COMPLETION OF ALL REGULATORY FILINGS. ANY POTENTIAL SOLICITATION OF
OFFERS TO BUY THE COMPANY'S COMMON STOCK WOULD ONLY BE MADE (IF AT ALL) PURSUANT
TO AN OFFER TO PURCHASE AND RELATED MATERIALS WHICH WOULD BE SENT BY JEWELCOR
MANAGEMENT, INC. TO THE COMPANY'S SHAREHOLDERS UPON COMMENCEMENT OF ANY SUCH
POTENTIAL OFFER. SHAREHOLDERS SHOULD CAREFULLY READ ANY SUCH MATERIALS IF AND
WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION,
INCLUDING THE VARIOUS TERMS AND CONDITIONS OF ANY SUCH OFFER. SHAREHOLDERS WILL
BE ABLE TO OBTAIN COPIES OF ANY SUCH OFFER TO PURCHASE RELATED MATERIALS AND
OTHER DOCUMENTS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION THROUGH THE
COMMISSION'S WEB SITE AT http://www.sec.gov: WITHOUT CHARGE IF AND WHEN ANY SUCH
DOCUMENTS BECOME AVAILABLE. SHAREHOLDERS WILL ALSO BE ABLE TO OBTAIN COPIES OF
ANY SUCH OFFER TO PURCHASE AND RELATED MATERIALS, WITHOUT CHARGE, IF AND WHEN
AVAILABLE, FROM JEWELCOR MANAGEMENT, INC. BY ORAL OR WRITTEN REQUEST TO:
JEWELCOR MANAGEMENT, INC., ATTENTION: JEFFREY UNGER, ESQ., 225 NORTHEAST MIZNER
BLVD., SUITE 675A, BOCA RATON, FLORIDA, 33432.