UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                         ----------------------------

                                   FORM 10-QSB


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

            For the quarterly period ended December 31, 1999

                                       OR

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

            For the transition period from ________ to __________


                         Commission File Number 1-14343


                      MIDLAND CAPITAL HOLDINGS CORPORATION
                 (Name of Small Business Issuer in its Charter)


                Delaware                         36-4238089
      (State or Other Jurisdiction of        (I.R.S. Employer
       Incorporation or Organization)      Identification Number)

      8929 S. Harlem Avenue, Bridgeview, Illinois   60455
      (Address of Principal Executive Offices)    (Zip Code)

Issuer's telephone number, including area code: (708) 598-9400

Check  whether  the Issuer  (1) has filed all  reports  required  to be filed by
Section 13 or 15 (d) of the  Exchange Act during the past 12 months (or 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. Yes (X) No
                                                                       ---   ---
Transitional Small Business Disclosure Format.  Yes      No  (X)
                                                   ----      ----

Indicate the number of shares of each of the Issuer's classes of common stock as
of the latest practicable date:

                          Common Stock, par value $.01
                                (Title of Class)

                    As of February 14, 2000, the Issuer had
                      363,975 shares of Common Stock issued
                                and outstanding.
<PAGE>

MIDLAND CAPITAL HOLDINGS CORPORATION


Part  I.  FINANCIAL INFORMATION
      PAGE

     Item 1.  Financial Statements
              Consolidated Statements of Financial Condition -
              December 31, 1999 (unaudited) and June 30,1999.................. 1

              Consolidated  Statements of Earnings -
              Three months ended  December 31, 1999 and 1998 and
              Six months ended December 31, 1999 and 1998 (unaudited)......... 2

              Consolidated Statements of Changes in Stockholders' Equity -
              Six months ended December 31, 1999 (unaudited).................. 3

              Consolidated  Statements of Cash Flows - Six months
              ended December 31, 1999 and 1998 (unaudited).................... 4

              Notes to Consolidated Financial Statements.................... 5-6

     Item 2.  Management's Discussion and Analysis of Financial
              Condition and Results of Operations.......................... 7-13


Part II.  OTHER INFORMATION.................................................. 14

     Index to Exhibits....................................................... 15


<PAGE>
CAPITAL HOLDINGS CORPORATION
AND SUBSIDIARIES

Part I ~ FINANCIAL INFORMATION

Consolidated Statements of Financial Condition
<TABLE>
<CAPTION>


Assets                                                         December 31,    June 30,
                                                                  1999           1999
                                                              ____________   ___________
                                                               (Unaudited)
<S>                                                              <C>           <C>
Cash and amounts due from
  depository institutions                                     $  5,198,035     3,933,658
Interest-bearing deposits                                       32,465,241    31,086,638
Total cash and cash equivalents                                 37,663,276    35,020,296
Investment securities, held to maturity (fair value:
  December 31, 1999 - $19,836,719;
  June 30, 1999 - $19,933,594)                                  19,991,644    19,994,152
Investment securities available for sale, at fair value          4,986,918     5,098,307
Mortgage-backed securities, held to maturity (fair value:
  December 31, 1999 - $23,278,308;
  June 30, 1999 - $15,938,491)                                  23,462,275    15,881,826
Loans receivable (net of allowance for loan losses:
  December 31, 1999 - $371,363;
  June 30, 1999 - $365,863)                                     49,729,874    48,914,195
Loans receivable, held for sale                                    220,850       435,150
Real estate owned, net                                                   0       276,372
Stock in Federal Home Loan Bank of Chicago                         636,000       636,000
Office properties and equipment, net                             2,500,368     2,594,050
Accrued interest receivable                                        628,995       611,966
Prepaid expenses and other assets                                  679,886       730,969
Total assets                                                  $140,500,086   130,193,283


Liabilities and Stockholders' Equity

Liabilities:
Deposits                                                      $130,498,179   120,224,584
Advance payments by borrowers for taxes and insurance              650,181       570,814
Other liabilities                                                  334,254       402,356
Total liabilities                                              131,482,614   121,197,754

Stockholders' equity:
Preferred stock, $.01 par value:
  authorized 1,000,000 shares; none outstanding                      -             -
Common stock, $.01 par value: authorized 5,000,000
  shares; issued and outstanding 363,975 shares
  at December 31, 1998 and June 30, 1999                             3,640         3,640
Additional paid-in capital                                       3,274,654     3,271,315
Retained earnings - substantially restricted                     5,761,830     5,685,591
Accumulated other comprehensive income, net of income taxes          6,178        80,030
Common stock awarded by Bank Incentive Plan                        (28,830)      (45,047)
Total stockholders' equity                                       9,017,472     8,995,529
Total liabilities and stockholders' equity                    $140,500,086   130,193,283

See accompanying notes to consolidated financial statements.
</TABLE>


                                      -1-

<PAGE>

MIDLAND CAPITAL HOLDINGS CORPORATION
AND SUBSIDIARIES


Consolidated Statements of Earnings
<TABLE>
<CAPTION>

                                            Three Months Ended        Six Months Ended
                                                December 31,             December 31,
                                             1999        1998         1999        1998
                                           _________   _________    _________   _________

                                                (Unaudited)              (Unaudited)
<S>                                           <C>         <C>          <C>          <C>
Interest income:
  Interest on loans                       $  912,119     835,645    1,808,517   1,634,773
  Interest on mortgage-backed securities     383,572     321,627      669,381     665,231
  Interest on investment securities          344,820     302,718      690,379     611,926
  Interest on interest-bearing deposits      463,021     358,738      930,343     747,972
  Dividends on FHLB stock                     12,023       9,374       22,443      18,625
Total interest income                      2,115,555   1,828,102    4,121,063   3,678,527

Interest expense:
  Interest on deposits                     1,268,494   1,064,614    2,454,317   2,124,389
Total interest expense                     1,268,494   1,064,614    2,454,317   2,124,389

Net interest income                          847,061     763,488    1,666,746   1,554,138

Non-interest income:
  Loan fees and service charges               48,973      88,013       98,325     185,426
  Commission income                           14,090      19,165       34,011      61,386
  Profit on sale of loans                     13,841       9,438       27,195      26,491
  Profit (loss) on sale of REO                 1,444      (2,375)       2,252       9,903
  Deposit related fees                       123,532     122,136      251,236     264,403
  Other income                                19,253      39,117       39,063      73,999
Total non-interest income                    221,133     275,494      452,082     621,608

Non-interest expense:
  Staffing costs                             482,992     518,887      977,056   1,008,095
  Advertising                                 32,498      17,249       67,137      36,650
  Occupancy and equipment expenses           177,869     111,371      361,102     234,984
  Data processing                             40,819      46,450       80,953     110,084
  Federal deposit insurance premiums          17,549      15,489       33,815      30,815
  Provision for loss on REO                        0       1,528            0       1,528
  Other                                      191,996     197,950      401,690     407,521
Total non-interest expense                   943,723     908,924    1,921,753   1,829,677

Income before income taxes                   124,471     130,058      197,075     346,069
Income tax provision                          41,829      44,731       66,240     118,185
Net income                                $   82,642      85,327      130,835     227,884

Earnings per share (basic)                $     0.23        0.24          .36         .63
Earnings per share (diluted)              $     0.22        0.23          .36         .62
Dividends declared per common share       $     0.075       0.075        0.15        0.15

</TABLE>

See accompanying notes to consolidated financial statements.

                                      -2-

<PAGE>

MIDLAND CAPITAL HOLDINGS CORPORATION
AND SUBSIDIARIES


Consolidated Statements of Changes in Stockholders' Equity (Unaudited)

<TABLE>
<CAPTION>
                                                         Accumulated   Common
                                    Additional              Other       stock
                            Common   Paid-In   Retained Comprehensive  awarded
                            Stock    Capital   Earnings    Income       by BIP   Total
                            ______  _________  _________ ____________  _______ _________
<S>                           <C>    <C>             <C>    <C>          <C>    <C>

Balance at June 30, 1999    $3,640  3,271,315  5,685,591    80,030    (45,047) 8,995,529

Comprehensive Income:

  Net Income                                     130,835                         130,835

  Other comprehensive
    income, net of tax:

  Unrealized holding loss
    during the period                                      (73,852)              (73,852)
                                                 _______   _______               _______

Total comprehensive income                       130,835   (73,852)               56,983

  Tax benefit related to
    employee stock plan                3,339                                       3,339

  Amoritzation of award of
    BIP stock                                                          16,217     16,217

  Dividends declared on
    common stock ($0.15
    per share)                                   (54,596)                        (54,596)
                            _____  _________   _________   _______     ______  _________
Balance at
  December 31, 1999        $3,640  3,274,654   5,761,830     6,178    (28,830) 9,017,472


</TABLE>



See accompanying notes to consolidated financial statements.

                                      -3-

<PAGE>

MIDLAND CAPITAL HOLDINGS CORPORATION
AND SUBSIDIARIES
<TABLE>
<CAPTION>

Consolidated Statements of Cash Flows (Unaudited)                 Six Months Ended
                                                                     December 31,
                                                                  1999           1998
                                                               ___________    ___________
<S>                                                                   <C>     <C>

Cash flows from operating activities:
Net income                                                    $    130,835        227,884
Adjustments to reconcile net income to net cash from
 operating activities:
  Depreciation                                                     152,774         79,420
  Amortization of premiums and discounts on securities             (17,459)         4,638
  Amortization of cost of stock benefit plan                        16,217         16,217
  Profit on sale of real estate owned                               (2,252)        (9,903)
  Provision for loss on real estate owned                                0          1,528
  Proceeds from sale of loans held for sale                      2,519,800      3,216,475
  Origination of loans held for sale                            (2,305,500)    (3,047,825)
  Profit on sale of loans                                          (27,196)       (26,491)
  Decrease in accrued interest receivable                           17,029         11,420
  Increase in accrued interest payable                               1,934          2,844
  Decrease in deferred income on loans                              (8,731)       (73,332)
  (Increase) decrease in other assets                               85,603       (125,677)
  Increase (decrease) in other liabilities                         (70,036)       211,961
Net cash provided by operating activities                          493,018        489,159

Cash flows from investing activities:
  Purchase of mortgage backed securities, held to maturity     (10,007,275)    (1,101,593)
  Proceeds from repayments of mortgage backed securities,
    held to maturity                                             2,440,312      3,073,390
  Purchase of investment securities, held to maturity           (4,994,025)    (4,999,800)
  Proceeds from maturities of investment securities,
    held to maturity                                             5,000,000      5,000,000
  Purchase of Federal Home Loan Bank stock                               0        (17,800)
  Loan disbursements                                            (4,473,447)   (13,662,091)
  Loan repayments                                                3,668,651      5,804,641
  Proceeds from sale of real estate owned                          276,472        153,525
  Property and equipment expenditures                              (59,092)      (273,847)
Net cash provided for investing activities                      (8,148,404)    (6,023,575)

Cash flows from financing activities:
  Deposit receipts                                             212,883,144    193,917,682
  Deposit withdrawals                                         (204,936,047)  (189,781,894)
  Interest credited to deposit accounts                          2,326,498      2,002,046
  Payment of dividends                                             (54,596)       (54,596)
  Increase in advance payments by borrowers
    for taxes and insurance                                         79,367         58,473
Net cash provided by financing activities                       10,298,366      6,141,711

Increase in cash and cash equivalents                            2,642,980        607,295
Cash and cash equivalents at beginning of period                35,020,296     31,994,195
Cash and cash equivalents at end of period                    $ 37,663,276     32,601,490

Cash paid during period for interest                          $  2,452,383      2,121,545
Cash paid during period for income taxes                                 0        102,260

</TABLE>

See accompanying notes to consolidated financial statements.

                                      -4-

<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Note A - Basis of Presentation
The accompanying  unaudited consolidated financial statements have been prepared
in accordance  with  instructions  to Form 10-QSB and therefore,  do not include
information or footnotes necessary for fair presentation of financial condition,
results of  operations  and changes in  financial  position in  conformity  with
generally accepted accounting principles. However, in the opinion of management,
all adjustments  (which are normal and recurring in nature) necessary for a fair
presentation  have been included.  The  preparation  of financial  statements in
conformity with generally accepted accounting  principles requires management to
make estimates and  assumptions  that affect the reported  amounts of assets and
liabilities and disclosures of contingent  assets and liabilities at the date of
the  financial  statements  and the  reported  amounts of revenues  and expenses
during the reporting  period.  Actual results could differ from those estimates.
The results of operations for the three months and six months ended December 31,
1999 are not necessarily indicative of the results which may be expected for the
entire year.

Note B - Principles of Consolidation
The  accompanying   unaudited  consolidated  financial  statements  include  the
accounts  of  Midland  Capital  Holdings  Corporation  (the  "Company")  and its
wholly-owned  subsidiary,  Midland  Federal  Savings and Loan  Association  (the
"Association") and the Association's wholly-owned subsidiaries,  Midland Service
Corporation,  MS Insurance Agency, Inc. and Bridgeview  Development Company. All
significant  intercompany  accounts and  transactions  have been  eliminated  in
consolidation.

Note C - Stock Conversion and Holding Company  Reorganization
On June 30, 1993,  the  Association  completed a conversion to the stock form of
organization  with the sale of 345,000  shares of $.01 par value common stock at
$10.00 per share.  On March 19, 1998, the Board of Directors of the  Association
adopted a proposal to reorganize the Association  into a holding company form of
organization  in accordance with a Merger  Agreement and Plan of  Reorganization
(the  "Reorganization").  The  Reorganization  was approved by the Association's
shareholders on July 15, 1998 and became effective on July 23, 1998. As a result
of the  Reorganization,  the  Association  became a  wholly-owned  subsidiary of
Midland Capital Holdings Corporation,  a newly formed Delaware Corporation,  and
each outstanding  share of common stock of the Association  became, by operation
of law,  one share of common  stock of  Midland  Capital  Holdings  Corporation.
Midland  Capital  Holdings  Corporation  operates  as a unitary  thrift  holding
company.

Note D - Earnings Per Share
Earnings per share for the three month and six month periods ended  December 31,
1999 and 1998 were  determined  by  dividing  net  income  for the period by the
weighted  average number of shares of common stock  outstanding  (see Exhibit 11
attached).  Stock  options are  regarded  as common  stock  equivalents  and are
therefore  considered in diluted earnings per share  calculations.  Common stock
equivalents are computed using the treasury stock method.

Note E - Industry Segments
The Company  operates  principally in the thrift industry through its subsidiary
savings and loan.  As such,  substantially  all of the Company's  revenues,  net
income,  identifiable  assets and  capital  expenditures  are  related to thrift
operations.



                                      -5-

<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

Notes to Consolidated Financial Statements (continued)

Note F - Effect of New Accounting Standards
In June 1998, the FASB issued  Statement of Financial  Accounting  Standards No.
133 ("SFAS 133"),  entitled  "Accounting for Derivative  Instruments and Hedging
Activities",  which is effective for fiscal years beginning after June 15, 1999.
SFAS 133 requires all  derivatives  to be recorded on the balance  sheet at fair
value.  It also  establishes  "special  accounting" for hedges of changes in the
fair value of assets,  liabilities,  or firm  commitments  (fair value  hedges),
hedges of the variable cash flows of forecasted transactions (cash flow hedges),
and  hedges  of  foreign  currency  exposures  of  net  investments  in  foreign
operations.  To the extent the hedge is considered  highly  effective,  both the
change in the fair value of the  derivative  and the change in the fair value of
the hedged item are recognized (offset) in earnings in the same period.  Changes
in fair value of derivatives that do not meet the criteria of one of these three
hedge categories are included in income.

In September 1999, the FASB issued Statement of Financial  Accounting  Standards
No. 137 ("SFAS 137"), entitled "Accounting for Derivative Instruments in Hedging
Activities - Deferral of the Effective Date of FASB  Statements  no. 133".  SFAS
137 defers the effective  date of SFAS 133 from years  beginning  after June 15,
1999 to all fiscal  quarters of all fiscal years  beginning after June 15, 2000.
Management  does not  believe  that  adoption  of SFAS 133 will have a  material
impact  on  the  Company's   consolidated  financial  condition  or  results  of
operations.

The  foregoing  does not  constitute  a  comprehensive  summary of all  material
changes or development affecting the manner in which the Company keeps its books
and  records and  performs  its  financial  accounting  responsibilities.  It is
intended only as a summary of some of the recent pronouncements made by the FASB
which are of particular interest to financial institutions.

                                      -6-

<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

GENERAL
Midland Capital Holdings  Corporation (the "Company") is a Delaware  corporation
which was organized in 1998 by Midland Federal Savings and Loan Association (the
"Association"  or  "Midland  Federal")  for the  purpose  of  becoming  a thrift
institution  holding company.  The Company and the Association are headquartered
in  Bridgeview,  Illinois.  The  Association  began  operations  in  1914  as  a
state-chartered  mutual savings  institution.  In 1982, the Association became a
federal mutual savings and loan  association.  On June 30, 1993, the Association
completed a conversion to the stock form of  organization.  In that  conversion,
the Association  issued 345,000 shares of common stock,  raising net proceeds of
approximately  $3.1  million.  On  July  23,  1998,  the  Association  became  a
wholly-owned  subsidiary of the Company by reorganizing  the Association  into a
holding company form of organization.  Each outstanding share of common stock of
the Association became one share of common stock of the Company.

The principal asset of the Company is the outstanding  stock of the Association.
The Company presently has no separate  operations and its business consists only
of the business of the Association and its  subsidiaries.  All references to the
Company,  unless  otherwise  indicated,  at or before July 23, 1998 refer to the
Association.  Midland  Federal has been  principally  engaged in the business of
attracting deposits from the general public and using such deposits to originate
residential mortgage loans, and to a lesser extent,  consumer,  multi-family and
other  loans  in  its  primary  market  area.  The  Association  also  has  made
substantial investments in mortgage-backed securities, investment securities and
liquid assets. Midland Federal also operates a wholly-owned subsidiary,  Midland
Service  Corporation  that owns and operates MS Insurance  Agency,  Inc., a full
service retail insurance agency.

The  Association's  primary market area consists of Southwest  Chicago,  and the
southwest  suburban  communities of Bridgeview,  Oak Lawn, Palos Hills,  Hickory
Hills, Justice,  Burbank,  Chicago Ridge, Lockport,  Orland Park and Lemont. The
Company  serves these  communities  through its main office in  Bridgeview,  two
branch banking offices in southwest Chicago and a third branch banking office in
Homer  Township,   Illinois.  The  Association's  deposits  are  insured  up  to
applicable  limits by the Federal Deposit  Insurance  Corporation  ("FDIC").  At
December  31,  1999,  Midland  Federal's  capital  ratios  exceeded  all  of its
regulatory  capital  requirements  with both tangible and core capital ratios of
6.28% and a risk-based capital ratio of 20.52%.

Forward Looking Statements
When used in this Form  10-QSB  and in future  filings by the  Company  with the
Securities and Exchange  Commission (the "SEC"), in the Company's press releases
or other public or shareholder communications,  and in oral statements made with
the approval of an  authorized  executive  officer,  the words or phrases  "will
likely  result",   "are  expected  to",  "will  continue",   "is   anticipated",
"estimate",   "project"  or  similar   expressions   are  intended  to  identify
"forward-looking  statements"  within  the  meaning  of the  Private  Securities
Litigation  Reform  Act of 1995.  Such  statements  are  subject  to  risks  and
uncertainties,  including  but not limited to changes in economic  conditions in
the  Company's  market  area,  changes  in  policies  by  regulatory   agencies,
fluctuations  in interest rates,  demand for loans in the Company's  market area
and  competition,  all or some of which  could  cause  actual  results to differ
materially  from  historical   earnings  and  those  presently   anticipated  or
projected.  The Company wishes to caution readers not to place undue reliance on
any such  forward-looking  statements,  which speak only as of the date made and
are subject to the above-stated qualifications in any event.

                                      -7-

<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

The Company  wishes to advise readers that the factors listed above could affect
the Company's financial performance and could cause the Company's actual results
for  future  periods  to  differ  materially  from any  opinions  or  statements
expressed with respect to future periods in any current statements.

FINANCIAL CONDITION
During the six months  ended  December  31,  1999,  total  assets of the Company
increased by $10.3  million to $140.5  million  from $130.2  million at June 30,
1999. Net loans  receivable and loans  available for sale increased  $601,000 to
$50.0  million at December 31, 1999 as loan  disbursements  of $6.8 million more
than offset loan repayments of $3.7 million and loan sales of $2.5 million.  The
balance of mortgage-backed securities increased by $7.6 million to $23.5 million
as a result of purchases of  mortgage-backed  securities  in the amount of $10.0
million,  which exceeded repayments of mortgage-backed  securities in the amount
of $2.4 million  during the six months ended  December 31, 1999.  The balance of
cash and cash equivalents increased by $2.6 million to $37.7 million at December
31, 1999. The increase in mortgage-backed  securities as well as the increase in
cash and cash equivalents was primarily funded by an increase in deposits in the
amount of $10.3 million to $130.4  million at December 31, 1999.  The balance of
investment  securities remained relatively unchanged at $25.0 million during the
six months ended December 31, 1999. The weighted average  remaining  maturity of
the  Company's  investment  securities  portfolio  at December  31, 1999 was 2.0
years.

As  discussed  above,  deposits  for the six  months  ended  December  31,  1999
increased  $10.3  million as deposit  activity of $212.9  million  and  interest
credited to deposits in the amount of $2.3 million exceeded  withdrawal activity
of $204.9 million. The net increase in savings deposits is attributed to a $10.6
million  increase in certificate of deposit accounts and a $1.2 million increase
in transaction deposits including money market accounts offset by a $1.5 million
decrease in passbook accounts. The net increase in savings deposits is primarily
attributed to aggressive  pricing and promotion of  certificate of deposit rates
at the Company's new branch banking office in Homer Township, Illinois.

Total stockholders'  equity for the six months ended December 31, 1999 increased
by $22,000 to $9.0  million  primarily  as a result of earnings in the amount of
$131,000 and a $16,000  reduction in the unamortized  cost of the  Association's
Bank  Incentive  Plan  offset by a $74,000  market  adjustment  from  securities
available for sale,  net of income taxes,  and dividends paid on common stock in
the amount of $54,000.

RESULTS OF OPERATIONS
The Company had net income of $83,000 for the quarter  ended  December  31, 1999
compared to net income of $85,000 for the quarter ended  December 31, 1998.  The
decline in net income in the current quarter is the result of a $54,000 decrease
in non-interest income and a $35,000 increase in non-interest  expense offset by
an $84,000  increase  in net  interest  income and a $3,000  decrease  in income
taxes.

For the six  months  ended  December  31,  1999 the  Company  had net  income of
$131,000  compared to net income of $228,000 for the six months  ended  December
31,  1998.  The  decline in net income in the  current  six month  period is the
result of a $170,000  decrease in non-interest  income and a $92,000 increase in
non-interest  expense offset by a $113,000 increase in net interest income and a
$52,000  decrease  in  income  taxes.  For  a  discussion  on  the  decrease  in
non-interest  income and the increase in  non-interest  expense that occurred in
both the three and six month periods ended December 31, 1999, see  "Non-Interest
Income" and "Non-Interest Expense."

                                      -8-

<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

RESULTS OF OPERATIONS (continued)
The  increase  in  net-interest  income in both the three and six month  periods
ended  December 31, 1999 was  primarily the result of an increase in the average
balance of interest  earning assets in both periods.  For the three months ended
December 31, 1999 the average balance of interest earning assets increased $18.6
million to $133.1  million from $114.5 million during the same period last year,
and for the six months ended December 31, 1999, the average  balance of interest
earning assets  increased $18.5 million to $132.2 million from $113.7 million in
the prior year period.  The increase in the average balance of interest  earning
assets in both the three and six months ended December 31, 1999 was funded by an
increase in deposit  liabilities that occurred between the current and the prior
year periods.

The  increases  in the average  balance of interest  earning  assets in both the
three and six month  periods  ended  December  31, 1999 offset  decreases in net
interest margin and interest rate spread that also occurred in both periods. Net
interest  margin  and  interest  rate  spread  decreased  to  2.55%  and  2.50%,
respectively  for the three months ended December 31, 1999 from 2.67% and 2.60%,
respectively,  for the three months ended  December 31, 1999. For the six months
ended December 31, 1999 net interest  margin and interest rate spread  decreased
to 2.52% and 2.46%, respectively,  compared to 2.73% and 2.64%, respectively, in
the prior  year six month  period.  The  declines  in net  interest  margin  and
interest rate spread that occurred in both the three and six month periods ended
December 31, 1999,  compared  with the prior year  periods,  were  attributed to
lower yields in the Company's loan and securities portfolios as well as a higher
percentage of certificate  of deposits  within the Company's  deposit  liability
mix.

The ratio of  average  interest  earning  assets  to  average  interest  bearing
liabilities  also  decreased  in both the  three  and six  month  periods  ended
December  31,  1999 to 108.86%  and  110.43%,  respectively,  from  109.31%  and
110.85%, respectively, in the prior year periods.

Interest Income
Interest income increased $287,000, or 15.7%, for the quarter ended December 31,
1999 from the comparable  year earlier  period.  The increase in interest income
was primarily the result of an $18.6 million increase in the average outstanding
balance of interest earning assets,  discussed above, which was partially offset
by a decrease in the average  yield earned on interest  earning  assets to 6.36%
for the quarter  ended  December 31, 1999  compared to 6.39% in the year earlier
period.

For the six months ended December 31, 1999 interest income increased $442,000 or
12.0% from the 1998 period.  The increase in interest income for the current six
month  period  was the  result  of an  $18.5  million  increase  in the  average
outstanding  balance of interest earning assets,  discussed  above,  offset by a
decrease in the average  yield earned on interest  earning  assets to 6.23% from
6.47% in the 1998 period.

Interest on loans receivable  increased  $76,000,  or 9.2%, in the quarter ended
December  31,  1999,  compared  with the prior year  quarter,  as a result of an
increase in the average  outstanding  balance of net loans  receivable  to $50.1
million  from $45.0  million in the 1998  quarter.  The  increase in the average
outstanding  balance of net loans  receivable  offset a decrease  in the average
yield earned on net loans receivable to 7.28% for the quarter ended December 31,
1999 from 7.43% for the prior year  quarter.  The decline in the  average  yield
earned on net loans receivable was primarily the result of lending activity that
occurred  at lower  market  interest  rates  between  the current and prior year
periods.


                                      -9-

<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

Interest Income (continued)
Interest on  mortgage-backed  securities  increased  $62,000,  or 19.3%, for the
quarter ended  December 31, 1999 from the year earlier  period.  The increase in
interest  income  was the  result  of a $4.5  million  increase  in the  average
outstanding  balance of  mortgage-backed  securities  to $23.8  million  for the
quarter ended December 31, 1999 from $19.3 million for the comparable prior year
period.  The  increase in the  average  outstanding  balance of  mortgage-backed
securities  offset a decline  in the  average  yield  earned on  mortgage-backed
securities to 6.45% from 6.67% in the 1998 quarter.

Interest earned on investment  securities  increased $42,000,  or 13.9%, for the
quarter ended December 31, 1999 from the prior year period due to a $3.8 million
increase in the average  outstanding  balance of investment  securities to $25.0
million  from $21.2  million in the 1998  quarter.  The  increase in the average
outstanding  balance of  investment  securities  offset a decline in the average
yield earned on investment  securities  to 5.51% for the quarter ended  December
31, 1999 from 5.70% in the year earlier period.

Interest earned on interest bearing deposits increased  $104,000,  or 29.1%, for
the quarter ended December 31, 1999 from the year earlier  period.  The increase
in interest income was the result of an increase in both the average outstanding
balance of interest  bearing  deposits as well as the  average  yield  earned on
interest bearing deposits.  For the quarter ended December 31, 1999, the average
outstanding balance of interest bearing deposits increased $5.1 million to $33.6
million from $28.5  million in the 1998 quarter and the average  yield earned on
interest  bearing  deposits  increased  to 5.51% from 5.04% in the year  earlier
period.

For the six  months  ended  December  31,  1999  interest  on  loans  receivable
increased  $174,000  from the  comparable  prior year  period.  The  increase in
interest  income was due to a $6.3 million  increase in the average  outstanding
balance of loans  receivable  to $49.7  million  from $43.4  million for the six
months  ended  December  31,  1998.  The $6.3  million  increase  in the average
outstanding  balance of loans receivable  offset a decrease in the average yield
earned on loans  receivable to 7.27% for the six months ended  December 31, 1999
from 7.54% in the prior year period.  The growth in the Company's loan portfolio
is attributed to direct marketing of the Company's loan products.

For the six months ended  December 31, 1999 interest  earned on mortgage  backed
securities increased $4,000 to $669,000.  The primary factor for the increase in
interest income was a $951,000  increase in the average  outstanding  balance of
mortgage-backed  securities to $20.9  million for the six months ended  December
31, 1999 from $19.9 million for the comparable  prior year period.  The increase
in the  average  outstanding  balance  of  mortgage-backed  securities  offset a
decline in the average yield earned on  mortgage-backed  securities to 6.40% for
the six months ended December 31, 1999 from 6.67% in the 1998 period.

For the six  months  ended  December  31,  1999  interest  earned on  investment
securities  increased $78,000 to $690,000 from $612,000 for the six months ended
December 31, 1998. The primary factor for the increase in interest  income was a
$3.8  million  increase  in  the  average   outstanding  balance  of  investment
securities  to $25.0  million for the six months  ended  December  31, 1999 from
$21.2 million for the prior year period. The increase in the average outstanding
balance of  investment  securities  was offset by a decrease  the average  yield
earned on investment  securities to 5.51% for the six months ended  December 31,
1999 from 5.76% in the comparable prior year period. The decrease in the average
yield  on the  Association's  investment  securities  was the  result  of  lower
reinvestment  yields on maturing  investment  securities  with the same original
terms to maturity.

                                      -10-

<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

Interest Income (continued)
For the six months ended December 31, 1999 interest  earned on interest  bearing
deposits  increased  $182,000 to $930,000  from  $748,000  for the year  earlier
period.  The  increase  in interest  income is  primarily  attributed  to a $7.3
million increase in the average outstanding balance of interest bearing deposits
to $35.9  million for the current  six month  period from $28.6  million for the
year earlier period. The increase in the average outstanding balance of interest
bearing  deposits  more than offset a decrease in the  average  yield  earned on
interest  bearing  deposits to 5.20% for the six months ended  December 31, 1999
from 5.24% in the year earlier period. The Company has historically maintained a
relatively high level of cash equivalents and other short term investments in an
attempt to control interest rate risk.

Interest Expense
Interest expense  increased  $204,000,  or 19.2%, for the quarter ended December
31, 1999  compared to the prior year quarter.  The increase in interest  expense
was the result of an $18.6 million  increase in the average  balance of interest
costing  deposits  to $122.3  million in the  current  year  period  from $103.7
million in the prior year  period.  The average  yield paid on interest  costing
deposits also increased  slightly to 4.15% in the current year period from 4.11%
in the 1998 quarter.

For the six months ended December 31, 1999 interest expense increased  $330,000,
or 15.5%, from the prior year period.  This increase in interest expense was the
result of an $18.4  million  increase  in the  average  outstanding  balance  of
interest  costing  deposits to $121.0 million for the current period from $102.6
million for the year earlier  period.  The  increase in the average  outstanding
balance of  interest  costing  deposits  was offset by a decrease in the average
yield paid on interest  costing  deposits to 4.06% for current  year period from
4.14% in the prior year period.

Provisions for Losses on Loans
The Company  maintains  an  allowance  for loan losses  based upon  management's
periodic evaluation of known and inherent risks in the loan portfolio, past loan
loss experience,  adverse situations that may affect borrowers' ability to repay
loans,  estimated  value of the  underlying  collateral and current and expected
market conditions.  The Company made no provisions for loan losses out of income
in either period based upon the absence of any specific asset quality  problems,
the current level of general loan loss reserves and  management's  assessment of
the inherent risks in the loan portfolio.  Non-performing loans, net of specific
reserves, decreased to $108,000 at December 31, 1999 and consisted of $57,000 in
one  single  family  residential  mortgage  loan,  $38,000  in one  multi-family
residential  mortgage loan and $13,000 in  non-mortgage  loans.  At December 31,
1999,  general loan loss  reserves  totaled  $184,000,  which amount was .74% of
total loans and 170.94% of net  non-performing  loans. At December 31, 1999, the
Company  was  aware  of  no  regulatory   directives  or  suggestions  that  the
Association make additional provisions for losses on loans. Although the Company
believes  its  allowance  for loan losses is at a level that it  considers to be
adequate to provide for potential  losses,  there can be no assurance  that such
losses will not exceed the estimated amounts.



                                      -11-

<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

Non-Interest Income
Non-interest income decreased $54,000 to $221,000 for the quarter ended December
31, 1999 from $275,000 for the prior year quarter.  The decrease in non-interest
income was due primarily to a $39,000 decrease in loan fees and service charges,
a combined  $16,000 decrease in rental revenue and profit from real estate owned
operations  and sales and a $5,000  decrease in  commission  income  offset by a
$4,000  increase in profit on the sale of loans.  The  decrease in loan fees and
service charges was attributed to a decline in loan origination  activity caused
by higher market interest rates.

For the six  months  ended  December  31,  1999  non-interest  income  decreased
$170,000 to $452,000 from $622,000 in the year earlier  period.  The decrease in
non-interest  income in the current six month period is primarily  the result of
an  $87,000  decrease  in loan fees and  service  charges,  a  combined  $39,000
decrease in rental  revenue and profit from real  estate  owned  operations  and
sales, a $27,000 decrease in commission income and a $13,000 decrease in deposit
related fees compared with the prior year period.

Non-Interest Expense
Non-interest expense increased $35,000 to $944,000 in the quarter ended December
31, 1999 compared to $909,000 in the 1998 quarter.  The increase in non-interest
expense in the current quarter is primarily the result of a $66,000  increase in
office  occupancy and equipment  expenses and a $15,000  increase in advertising
expense.  These  increases  in  non-interest  expense  were  offset by a $36,000
decrease in staffing  costs,  a $6,000  decrease in data  processing  fees and a
$6,000 decrease in other operating expenses.

For the six months  ended  December  31,  1999  non-interest  expense  increased
$92,000 to $1.9 million from $1.8 million in the prior year period.  The primary
factors for the increase in non-interest expense in the current six month period
were a $126,000  increase  in  occupancy  and  equipment  expense  and a $30,000
increase  in  advertising  expenses,  offset by a $31,000  decrease  in staffing
costs, a $29,000 decrease in data processing fees and a $6,000 decrease in other
operating expenses, compared with the prior year period.

Both the increases in office occupancy and advertising expenses in the three and
six month periods ended  December 31, 1999 were the result of the  operations of
the  Company's  new full  service  branch  banking  facility in Homer  Township,
Illinois,  which  opened  for  business  in April  1999.  The  decrease  in data
processing  fees in both current year periods was the result of the  elimination
of a $38,000  de-conversion  fee incurred in the quarter ended December 31, 1998
when the  Company  converted  its  on-line  data  processing  systems to another
service provider.

Income Taxes
Income taxes  decreased to $42,000 in the quarter  ended  December 31, 1999 from
$45,000 for the prior year quarter.  For the six months ended  December 31, 1999
income taxes decreased to $66,000 compared to $118,000 in the prior year period.
The  decreased  income  tax  provision  was due  primarily  to the  decrease  in
operating income in both periods as compared to the prior year periods.




                                      -12-

<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

LIQUIDITY AND CAPITAL RESOURCES
The Company's principal sources of funds are deposits,  loan and mortgage backed
securities repayments, proceeds from the maturities of investment securities and
other funds  provided by operations.  In addition,  the  Association  may borrow
funds from the FHLB of Chicago.  The  Company  maintains  investments  in liquid
assets based upon  management's  assessment of (i) the Company's need for funds,
(ii) expected  deposit flows,  (iii) the yields  available on short-term  liquid
assets  and (iv) the  objectives  of the  Company's  asset/liability  management
program.  The OTS requires members of the FHLB system to maintain minimum levels
of liquid assets. OTS regulations  currently require the Association to maintain
an average daily balance of liquid assets equal to at least 4% of the sum of its
average  daily  balance of net  withdrawable  deposit  accounts  and  borrowings
payable in one year or less. At December 31, 1999, the Association's  regulatory
liquidity ratio was 53.1%. The Company had outstanding  commitments to originate
$1.2 million in loans and to sell $221,000 in loans at December 31, 1999.

The  Company  uses  its  capital  resources  principally  to  meet  its  ongoing
commitments to fund maturing  certificate  of deposits and deposit  withdrawals,
fund existing and continuing loan  commitments,  maintain its liquidity and meet
operating  expenses.  At December 31, 1999 the  Association had $58.5 million of
certificates of deposit maturing in one year or less. The Company  considers its
liquidity  and capital  reserves  sufficient to meet its  outstanding  short and
long-term  needs.  The  Company  expects to be able to fund or  refinance,  on a
timely basis, its material commitments and long-term liabilities.

At December  31, 1999 the  Association  had  tangible  and core  capital of $8.8
million, or 6.3% of adjusted total assets,  which was approximately $6.7 million
and $4.6 million above the minimum  requirements  in effect on that date of 1.5%
and 3.0%, respectively, of adjusted total assets.

At  December  31,  1999  the  Association  had  total  capital  of $9.0  million
(including  $8.8  million in core  capital)  and  risk-weighted  assets of $44.0
million, or total capital of 20.5% of risk-weighted assets. This amount was $5.5
million above the 8.0% requirement in effect on that date.



                                      -13-

<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION

PART II - OTHER INFORMATION


Item 1.  LEGAL PROCEEDINGS
From time to time, the  Association is a party to legal  proceedings  wherein it
enforces its security interest or is a defendant to certain lawsuits arising out
of the ordinary course of its business.  Neither the Company nor the Association
believes  that  it is a party  to any  legal  proceedings  which,  if  adversely
determined,  would have a material adverse effect on its financial  condition at
this time.

Item 2.  CHANGES IN SECURITIES
Not applicable.

Item 3.  DEFAULTS UPON SENIOR SECURITIES
Not applicable.

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY  HOLDERS On October 20, 1999
the shareholders held their annual meeting to consider and act upon the election
of Mr. Michael J. Kukanza and Mr. Richard Taylor to serve as directors for terms
of three years and the  ratification of the appointment of Cobitz,  VandenBerg &
Fennessy as auditors  for the Company for the fiscal year ending June 30,  2000.
Both of the foregoing items were approved by the  shareholders at the meeting by
the following vote totals based upon 363,975 shares  outstanding and entitled to
vote at the meeting.

I.    Election of Directors - 337,164 shares voted, as follows:
      Michael J. Kukanza:     337,164 votes FOR; -0- votes withheld.
      Richard Taylor:         337,164 votes FOR; -0- votes withheld.

II. Ratification of the appointment of Cobitz, VandenBerg & Fennessy as auditors
for the Company for the fiscal  year  ending  June 30,  2000  (Compass)  337,164
shares voted, as follows:
      FOR:        337,164
      AGAINST:    -0-
      ABSTAIN:    -0-

Item 5.  OTHER INFORMATION
Not applicable.

Item 6.  EXHIBITS AND REPORTS ON FORM 8-K
(a) Computation of earnings per share (Exhibit 11 filed herewith).
(b) Financial data schedule (Exhibit 27 filed herewith).
(c) No reports on Form 8-K were filed this quarter.




                                      -14-

<PAGE>

INDEX TO EXHIBITS

Exhibit
Number      Description
--------    ------------
11          Computation of Per Share Earnings

27          Financial Data Table






























                                      -15-


<PAGE>

                                   SIGNATURES


Pursuant  to the  requirements  of  Section 13 or 15 (d) of the  Securities  and
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.



                            MIDLAND CAPITAL HOLDINGS CORPORATION
                            ------------------------------------
                            Registrant



DATE:  February 14, 2000    BY: /s/ Paul Zogas
                                -------------------------------------
                                Paul Zogas
                                President, Chief Executive Officer
                                and Chief Financial Officer



DATE:  February 14, 2000    BY: /s/ Charles Zogas
                                -------------------------------------
                                Charles Zogas
                                Executive Vice President and
                                Chief Operating Officer