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 March 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 May 13, 1999, 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 -
            March 31, 1999 (unaudited) and June 30, 1998.................... 1

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

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

            Consolidated Statements of Cash Flows - Nine months
            ended March 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........................... 7-14


Part II.  OTHER INFORMATION.................................................15

<PAGE>



                                    MIDLAND
                          CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

Part I ~ FINANCIAL INFORMATION

Consolidated Statements of Financial Condition
<TABLE>
<CAPTION>

Assets                                                          March 31,      June 30,
                                                                  1999           1998
                                                            ---------------   ----------
                                                               (Unaudited)
<S>                                                         <C>               <C>
Cash and amounts due from
  depository institutions                                     $  2,842,806     2,656,448
Interest-bearing deposits                                       28,248,633    29,337,747
                                                              ------------    ----------
Total cash and cash equivalents                                 31,091,439    31,994,195
Investment securities, held to maturity (fair value:
  March 31, 1999 - $20,037,500;
  June 30, 1998 - $20,030,469)                                  19,995,153    19,989,055
Investment securities available for sale, at fair value          1,175,000     1,195,938
Mortgage-backed securities, held to maturity (fair value:
  March 31, 1999 - $17,221,839;
  June 30, 1998 - $21,128,839)                                  17,045,549    20,844,623
Loans receivable (net of allowance for loan losses:
  March 31, 1999 - $395,527;
  June 30, 1998 - $393,884)                                     49,131,059    38,513,121
Loans receivable, held for sale                                    306,450       659,450
Real estate owned, net                                             601,372       746,522
Stock in Federal Home Loan Bank of Chicago                         571,800       554,000
Office properties and equipment, net                             1,793,748     1,567,285
Accrued interest receivable                                        608,125       619,464
Prepaid expenses and other assets                                1,329,532       689,727
                                                              ------------   -----------
Total assets                                                  $123,649,227   117,373,380
                                                              ============   ===========


Liabilities and Stockholders' Equity

Liabilities:
Deposits                                                      $113,951,250   107,761,846
Advance payments by borrowers for taxes and insurance              266,493       447,668
Other liabilities                                                  388,244       396,229
                                                               -----------   -----------
Total liabilities                                              114,605,987   108,605,743
                                                               -----------   -----------

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 March 31, 1999 and June 30, 1998                                3,640         3,640
Additional paid-in capital                                       3,271,315     3,266,315
Retained earnings - substantially restricted                     5,690,635     5,430,065
Accumulated other comprehensive income, net of income taxes        130,806       145,099
Common stock awarded by Bank Incentive Plan                        (53,156)      (77,482)
                                                              ------------   -----------
Total stockholders' equity                                       9,043,240     8,767,637
                                                              ------------   -----------
Total liabilities and stockholders' equity                    $123,649,227   117,373,380
                                                              ============   ===========

</TABLE>

See accompanying notes to consolidated financial statements.
                                      -1-

<PAGE>
                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES


Consolidated Statements of Earnings
<TABLE>
<CAPTION>

                                            Three Months Ended       Nine Months Ended
                                                 March 31,                March 31,
                                             1999        1998         1999        1998
                                           _________   _________    _________   _________

                                                (Unaudited)              (Unaudited)
<S>                                       <C>       <C>           <C>         <C>

Interest income:
  Interest on loans ....................   $  895,134      691,050    2,529,907    2,063,906
  Interest on mortgage-backed securities      286,659      384,903      951,890    1,193,458
  Interest on investment securities ....      296,586      312,171      908,512      934,426
  Interest on interest-bearing deposits       329,376      337,061    1,077,348    1,008,909
  Dividends on FHLB stock ..............        8,812        9,050       27,437       28,250
                                            ---------    ---------    ---------    ---------
Total interest income ..................    1,816,567    1,734,235    5,495,094    5,228,949
                                            ---------    ---------    ---------    ---------

Interest expense:
  Interest on deposits .................    1,026,410      939,208    3,150,800    2,868,232
                                            ---------    ---------    ---------    ---------
Total interest expense .................    1,026,410      939,208    3,150,800    2,868,232
                                            ---------    ---------    ---------    ---------

Net interest income ....................      790,157      795,027    2,344,294    2,360,717
                                            ---------    ---------    ---------    ---------

Non-interest income:
  Loan fees and service charges ........       72,888       54,721      258,314      150,364
  Commission income ....................       29,008       16,010       90,394       78,695
  Profit on sale of loans ..............       12,799        3,294       39,290       16,065
  Profit on sale of REO ................            0            0        9,903            0
  Deposit related fees .................      135,510      144,085      399,913      458,441
  Other income .........................       51,580       44,370      125,580      113,455
                                            ---------    ---------    ---------    ---------
Total non-interest income ..............      301,785      262,480      923,394      817,020
                                            ---------    ---------    ---------    ---------

Non-interest expense:
  Staffing costs .......................      492,742      439,381    1,500,836    1,305,653
  Advertising ..........................       17,559       25,428       54,208       66,656
  Occupancy and equipment expenses .....      152,349      124,279      387,334      354,076
  Data processing ......................       47,405       41,039      157,489      115,990
  Federal deposit insurance premiums ...       16,709       15,609       47,524       47,751
  Provision for loss on REO ............            0            0        1,528            0
  Other ................................      191,554      188,656      599,076      533,488
Total non-interest expense .............      918,318      834,392    2,747,995    2,423,614
                                            ---------    ---------    ---------    ---------

Income before income taxes .............      173,624      223,115      519,693      754,123
Income tax provision ...................       59,043       75,869      177,228      256,432
                                            ---------    ---------    ---------    ---------
Net income .............................   $  114,581      147,246      342,465      497,691
                                            =========    =========    =========    =========

Earnings per share (basic) .............   $     0.31         0.41          .94         1.41
                                            =========    =========    =========    =========
Earnings per share (diluted) ...........   $     0.31         0.40          .93         1.40
                                            =========    =========    =========    =========
Dividends declared per common share ....   $    0.075        0.075        0.225        0.225
                                            =========    =========    =========    =========


</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, 1998    $3,640    3,266,315    5,430,065     145,099      (77,482)   8,767,637
                             -----    ---------    ---------     -------      --------   ---------

Comprehensive Income:

  Net Income                                       342,465                                 342,465

  Other comprehensive
    income, net of tax:

  Unrealized holding loss
    during the period                                            (14,293)                  (14,293)
                                                   -------      --------                   -------

Total comprehensive income                         342,465       (14,293)                  328,172

  Tax benefit related to
    employee stock plan                  5,000                                               5,000

  Amoritzation of award of
    BIP stock                                                                  24,326       24,326

  Dividends declared on
    common stock ($0.225
    per share)                                     (81,895)                                (81,895)
                           ------    ---------   ---------      --------     --------    ---------
Balance at March 31, 1999  $3,640    3,271,315   5,690,635       130,806      (53,156)   9,043,240
                           ======    =========   =========      ========      =======    =========
</TABLE>

                                      -3-
<PAGE>

<TABLE>
<CAPTION>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

Consolidated Statements of Cash Flows (Unaudited)                 Nine Months Ended
                                                                       March 31,
                                                                  1999           1998
                                                               -----------    -----------
<S>                                                          <C>              <C>>

Cash flows from operating activities:
Net income ...............................................   $     342,465          497,691
Adjustments to reconcile net income to net cash from
 operating activities:
  Depreciation ...........................................         127,450          109,117
  Amortization of premiums and discounts on securities ...           4,999           20,622
  Amortization of cost of stock benefit plan .............          24,326           24,326
  Profit on sale of real estate owned ....................          (9,903)               0
  Provision for loss on real estate owned ................           1,528                0
  Proceeds from sale of loans held for sale ..............       4,158,025        1,404,400
  Origination of loans held for sale .....................      (3,805,025)      (1,599,850)
  Profit on sale of loans ................................         (39,290)         (16,065)
  Decrease (increase) in accrued interest receivable .....          11,339           (3,052)
  Increase in accrued interest payable ...................           3,601            2,913
  Decrease in deferred income on loans ...................        (108,567)         (47,329)
  (Increase) decrease in other assets ....................        (586,509)          34,076
  (Decrease) increase in other liabilities ...............         (11,586)          23,850
                                                                 ---------        ---------
Net cash provided by operating activities ................         112,853          450,699
                                                                 ---------        ---------

Cash flows from investing activities:
  Purchase of mortgage backed securities, held to maturity      (1,101,593)      (4,610,445)
  Proceeds from repayments of mortgage backed securities,
    held to maturity .....................................       4,888,227        4,169,984
  Purchase of investment securities, held to maturity ....      (7,499,375)      (7,489,050)
  Proceeds from maturities of investment securities,
    held to maturity .....................................       7,500,000        7,500,000
  Purchase of Federal Home Loan Bank stock ...............         (17,800)               0
  Loan disbursements .....................................     (19,455,588)      (7,773,613)
  Loan repayments ........................................       8,944,574        6,237,916
  Proceeds from sale of real estate owned ................         153,525                0
  Property and equipment expenditures ....................        (353,913)         (94,807)
                                                                 ---------        ---------
Net cash provided for investing activities ...............      (6,941,943)      (2,060,015)
                                                                 ---------        ---------

Cash flows from financing activities:
  Proceeds from exercise of stock options ................               0          189,750
  Deposit receipts .......................................     284,720,430      262,733,930
  Deposit withdrawals ....................................    (281,504,909)    (266,404,533)
  Interest credited to deposit accounts ..................       2,973,883        2,711,434
  Payment of dividends ...................................         (81,895)         (79,307)
  Decrease in advance payments by borrowers
    for taxes and insurance ..............................        (181,175)        (168,337)
                                                                 ---------        ---------
Net cash provided for financing activities ...............       5,926,334       (1,017,063)
                                                                 ---------        ---------

Decrease in cash and cash equivalents ....................        (902,756)      (2,626,379)
Cash and cash equivalents at beginning of period .........      31,994,195       30,902,575
                                                                ----------       ----------
Cash and cash equivalents at end of period ...............   $  31,091,439       28,276,196
                                                                ==========       ==========

Cash paid during period for interest .....................   $   3,147,199        2,865,319
Cash paid during period for income taxes .................         120,260          164,000
Non-cash investing activities:
  Transfer of loans to real estate owned .................   $           0           58,022
                                                                ==========       ==========
</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 nine  months  ended  March 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  subsidiaries,  Midland Federal Savings and Loan  Association  (the
"Association"),  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

In  January,  1993,  the  Association's  Board of  Directors  approved a plan to
voluntarily  convert  the  Association  from a federal  mutual  savings and loan
association to a federal stock savings and loan association.  The stock offering
of Midland Federal Savings and Loan Association was closed on June 30, 1993 with
the sale of 345,000 shares of $.01 par value common stock at $10.00 per share.

Note D ~ Holding Company Reorganization

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 E - Earnings Per Share

Earnings  per share for the three month and nine month  periods  ended March 31,
1999 and 1998 were  determined  by  dividing  net  income  for the period by the
weighted  average  number of both basic and diluted  shares of common  stock and
common stock  equivalents  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.


                                      -5-

<PAGE>
                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

Notes to Consolidated Financial Statements (continued)

Note F - Effect of New Accounting Standards

In February 1998, the FASB issued  Statement of Financial  Accounting  Standards
No. 132 ("SFAS 132"),  entitled "Employers'  Disclosure about Pensions and Other
Post-retirement  Benefits".  SFAS 132  alters  current  disclosure  requirements
regarding  pensions  and  other   post-retirement   benefits  in  the  financial
statements of employers who sponsor such benefit plans.  The revised  disclosure
requirements are designed to provide additional information to assist readers in
evaluating  future  costs  related  to such  plans.  Additionally,  the  revised
disclosures  are designed to provide  changes in the  components  of pension and
benefit  costs in addition to the year end  components  of those  factors in the
resulting asset or liability  related to such plans.  The statement is effective
for fiscal years  beginning  after  December  15, 1997 with earlier  application
available.  Management  does not believe  that  adoption of SFAS 132 will have a
material impact on the Company's  consolidated financial condition or results of
operations.

In June 1998, the FASB issued  Statement of Financial  Accounting  Standards No.
133 ("SFAS  133"),  entitled  "Accounting  for  Derivative  Instruments  and for
Hedging  Activities".  SFAS 133 provides a comprehensive and consistent standard
for the recognition and measurement of derivatives and hedging  activities.  The
statement  requires all  derivatives to be recorded on the balance sheet at fair
value and establishes special accounting for the following three different types
of hedges:  hedges of changes in the fair value of assets,  liabilities  or firm
commitments  (referred to as 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.  Though  the
accounting  treatment  and  criteria  for each of the  three  types of hedges is
unique, they all result in recognizing offsetting changes in value or cash flows
of both the hedge and the hedged item in earnings in the same period. Changes in
the fair  value of  derivatives  that do not meet the  criteria  of one of these
three categories of hedges are included in earnings in the period of the change.
SFAS 133 is effective for years beginning after June 15, 1999, but companies can
early adopt as of the  beginning  of any fiscal  quarter  that begins after June
1998.  Management  does not  expect the  adoption  of this  statement  to have a
material impact on the Company's  consolidated financial condition or results of
operations.

In October 1998, the FASB issued Statement of Financial Accounting Standards No.
134 ("SFAS 134"),  entitled "Accounting for Mortgage-Backed  Securities Retained
after the  Securitization  of Mortgage Loans Held for Sale by a Mortgage Banking
Enterprise.  SFAS 134 is effective for the first fiscal  quarter after  December
15, 1998.  This statement  amends SFAS No. 65 "Accounting  for Certain  Mortgage
Banking   Activities."  This  statement  revises  the  accounting  for  retained
securities and beneficial  interests.  Management does not believe that adoption
of SFAS No.  134 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
untended 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.  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.
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.

The  Association's  primary market area consists of Southwest  Chicago,  and the
southwest  suburban  communities of Bridgeview,  Oak Lawn, Palos Hills,  Hickory
Hills, Burbank and Justice which it serves through its main office in Bridgeview
and two  branch  banking  offices  in  southwest  Chicago.  In April  1999,  the
Association  opened a  full-service  branch  banking  facility  located in Homer
Township,  Illinois,  a southwest suburb of Chicago.  The primary market area of
the  Association's  Homer  Township  facility are the  communities  of Lockport,
Lemont and Orland Park. The Association's  deposits are insured up to applicable
limits by the Federal Deposit Insurance  Corporation ("FDIC"). At March 31, 1999
Midland  Federal had tangible and core capital of $8.2  million,  which  capital
levels exceeded all of its fully phased-in regulatory capital requirements.

FINANCIAL CONDITION

During  the nine  months  ended  March 31,  1999,  total  assets of the  Company
increased  by $6.2  million to $123.6  million  from $117.4  million at June 30,
1998. Net loans  receivable and loans available for sale increased $10.3 million
to $49.4 million at March 31, 1999 as loan  disbursements  of $23.3 million more
than offset loan repayments of $8.9 million and loan sales of $4.2 million.  The
$10.3 million  increase in net loans  receivable was primarily  funded by a $6.2
million  increase  in  deposits to $114.0  million at March 31,  1999.  Mortgage
backed  securities  declined by $3.8 million due to  repayments in the amount of
$4.9 million,  which  exceeded  purchases of  mortgage-backed  securities in the
amount of $1.1 million  during the nine months ended March 31, 1999. The balance
of investment securities remained stable at $21.2 million at March 31, 1999. The
weighted  average  remaining  maturity of the  Company's  investment  securities
portfolio at March 31, 1999 was 1.8 years.

                                      -7-

<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                     AND RESULTS OF OPERATIONS (continued)

FINANCIAL CONDITION (continued)

As discussed above,  deposits for the nine months ended March 31, 1999 increased
by $6.2 million as deposit  activity of $284.7 million and interest  credited to
deposits in the amount of $3.0 million  exceeded  withdrawal  activity of $281.5
million.  The net increase in savings  deposits is  attributed to a $2.5 million
increase  in  certificate  of  deposit  accounts,  a $2.3  million  increase  in
transaction deposits including money market accounts and a $1.4 million increase
in passbook accounts. The net increase in savings deposits is attributed to more
aggressive pricing and promotion of certificate of deposit rates.

Stockholders' equity for the nine months ended March 31, 1999 increased $276,000
to $9.0 million.  The increase in stockholders'  equity was primarily the result
of earnings in the amount of $342,000 and a $24,000 reduction in the unamortized
cost of the  Association's  Bank  Incentive  Plan,  offset by a  $14,000  market
adjustment  from  securities  available  for  sale,  net of  income  taxes,  and
dividends paid on common stock in the amount of $82,000.

RESULTS OF OPERATIONS

The  Company had net income of  $115,000  for the  quarter  ended March 31, 1999
compared to net income of $147,000  for the quarter  ended March 31,  1998.  The
decline in net income in the current  quarter is the result of a $5,000 decrease
in net interest income and an $84,000 increase in non-interest expense offset by
a $40,000  increase  in  non-interest  income and a $17,000  decrease  in income
taxes.  Net interest  income  decreased  $5,000 to $790,000 in the quarter ended
March 31, 1999 from $795,000  during the prior year quarter as decreases in both
net interest  margin and interest  rate spread  offset  increases in the average
balance of interest  earning  assets.  For the quarter  ended March 31, 1999 the
Company's net interest  margin and interest rate spread both  decreased to 2.72%
and 2.65%,  respectively,  from 3.07% and 2.99%,  respectively,  for the quarter
ended March 31, 1998. The average balance of interest  earning assets  increased
$12.5 million to $116.1 million for the quarter ended March 31, 1999 from $103.6
million in the prior year quarter.  The ratio of average interest earning assets
to average interest bearing liabilities also increased to 110.65% in the quarter
ended March 31, 1999 from 110.50% in the prior year quarter.

For the nine months  ended March 31, 1999 the Company had net income of $342,000
compared to net income of $498,000 for the nine months ended March 31, 1998. The
decline  in net  income in the  current  nine  month  period is the  result of a
$16,000 decrease in net interest income and a $324,000  increase in non-interest
expense  offset by a  $106,000  increase  in  non-interest  income and a $79,000
decrease in income  taxes.  The decrease in net  interest  income in the current
nine month period is  attributed  to  decreases in both net interest  margin and
interest rate spread.  Net interest margin and interest rate spread decreased to
2.73% and 2.64%, respectively from 3.04% and 2.97%,  respectively,  in the prior
year period.  The declines in both net interest  margin and interest rate spread
offset an $11.1  million  increase  in the average  balance of interest  earning
assets to $114.5  million for the nine months ended March 31, 1999. The ratio of
average interest  earning assets to average  interest  bearing  liabilities also
increased to 110.65% from 110.12% in the prior year period.

                                      -8-

<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                     AND RESULTS OF OPERATIONS (continued)

Interest Income

Interest income increased $82,000, or 4.7%, for the quarter ended March 31, 1999
from the comparable  prior year quarter.  An increase in the average  balance of
interest  earning  assets to $116.1 million for the quarter ended March 31, 1999
from $103.6 million for the quarter ended March 31, 1998 was partially offset by
a decrease in the average yield earned on interest  earning  assets to 6.26% for
the quarter  ended March 31, 1999  compared to 6.70% for the quarter ended March
31, 1998.

For the nine months ended March 31, 1999 interest income  increased  $266,000 or
5.1% from the  comparable  prior year  period as the result of an $11.1  million
increase in the average outstanding balance of interest earning assets to $114.5
million  from the prior year  period.  The  increase in the average  outstanding
balance of interest earning assets was offset by a decrease in the average yield
earned on interest earning assets to 6.40% from 6.74% in the prior year period.

Interest on loans  receivable  increased  $204,000,  or 29.5%, as a result of an
increase in the average  outstanding  balance of net loans  receivable  to $48.6
million for the quarter  ended March 31, 1999 from $34.1 million for the quarter
ended March 31,  1998.  The increase in the average  outstanding  balance of net
loans  receivable  offset  a  decrease  in the  average  yield  earned  on loans
receivable  to 7.37% for the  quarter  ended  March 31,  1999 from 8.10% for the
quarter  ended March 31, 1998.  The decline in average yield is primarily due to
increased  refinance  activity on loans due to the continued decline in interest
rates.

Interest on mortgage backed securities  decreased $98,000, or 25.5%, as a result
of a $5.1 million reduction in the average balance of mortgage backed securities
outstanding  to $17.6  million for the  quarter  ended March 31, 1999 from $22.7
million  for the quarter  ended March 31,  1998.  The  average  yield  earned on
mortgage  backed  securities also decreased to 6.51% for the quarter ended March
31, 1999 from 6.78% for the quarter ended March 31, 1998.

Interest earned on investment  securities  decreased $16,000,  or 5.0%, due to a
decrease in the average yield on investment  securities to 5.60% for the quarter
ended  March 31,  1999 from 5.90% for the  quarter  ended  March 31,  1998.  The
average  balance of investment  securities  remained stable at $21.2 million for
the quarter ended March 31, 1999 as compared with the prior year quarter.

Interest earned on interest bearing  deposits  decreased  $8,000,  or 2.3%, as a
result of a decrease in the average yield earned on interest bearing deposits to
4.69% for the quarter  ended  March 31,  1999 from 5.39% for the  quarter  ended
March 31,  1998.  The decrease in the average  yield earned on interest  bearing
deposits was partially offset by an increase in the average  outstanding balance
of interest  bearing  deposits to $28.4  million for the quarter ended March 31,
1999 compared to $25.0 million for the quarter ended March 31, 1998.

                                      -9-
<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                     AND RESULTS OF OPERATIONS (continued)

Interest Income (continued)

For the nine months ended March 31, 1999 interest on loans receivable  increased
$466,000  from the  comparable  prior year  period.  The increase in interest on
loans receivable was due to an $11.4 million increase in the average outstanding
balance of loans  receivable  to $45.1  million from $33.7  million for the nine
months  ended  March  31,  1998.  The  $11.4  million  increase  in the  average
outstanding  balance of loans receivable  offset a decrease in the average yield
earned on loans  receivable  to 7.48% for the nine  months  ended March 31, 1999
from 8.16% for the prior year period. The growth in the Company's loan portfolio
is attributed to aggressive  pricing and direct  marketing of the Company's loan
products.

For the nine  months  ended March 31, 1999  interest  earned on mortgage  backed
securities  decreased $242,000 to $952,000 from $1.2 million for the nine months
ended  March 31,  1998.  The  primary  factor for the  decrease  in  interest on
mortgage  backed   securities  was  a  $4.4  million  decrease  in  the  average
outstanding  balance of mortgage  backed  securities as well as a decline in the
average yield earned on mortgage backed securities. During the nine months ended
March 31, 1999 the average  outstanding  balance of mortgage  backed  securities
declined to $19.2 million from $23.6 million for the nine months ended March 31,
1998. The average yield earned on mortgage  backed  securities  also declined to
6.62% for the nine  months  ended  March 31, 1999 from 6.73% for the nine months
ended March 31, 1998.  Proceeds from  repayments of mortgage  backed  securities
were used to partially fund the increased loan demand, discussed above.

For the  nine  months  ended  March  31,  1999  interest  earned  on  investment
securities decreased $26,000 to $908,000 from $934,000 for the nine months ended
March 31,  1998.  The primary  factor for the  decrease  in  interest  earned on
investment  securities  was a decrease in the average yield earned on investment
securities  to 5.71% for the nine months ended March 31, 1999 from 5.90% for the
nine  months  ended March 31,  1998.  The  decrease in the average  yield on the
Association's  investment securities was the result of lower reinvestment yields
on maturing  investment  securities despite the same original terms to maturity.
The average balance of investment  securities remained constant at $21.2 million
for both the nine months ended March 31, 1999 and 1998.

For the nine months  ended March 31, 1999  interest  earned on interest  bearing
deposits increased $68,000 to $1.1 million from $1.0 million for the nine months
ended March 31, 1998. The increase in interest income is primarily attributed to
a $4.0 million increase in the average  outstanding  balance of interest bearing
deposits to $28.4  million  for the nine months  ended March 31, 1999 from $24.4
million for the nine months  ended March 31,  1998.  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 5.05% for the nine
months ended March 31, 1999 from 5.52% in the year earlier period.  The decrease
in the average  yield on interest  bearing  deposits  reflected  the decrease in
short-term  market  interest  rates that occurred  between the two periods.  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.

                                      -10-

<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                     AND RESULTS OF OPERATIONS (continued)

Interest Expense

Interest expense increased $87,000,  or 9.3%, due to a $11.1 million increase in
the average  balance of  interest  costing  deposits  to $104.9  million for the
quarter  ended March 31, 1999 from $93.8  million in the quarter ended March 31,
1998. The increase in the average balance of interest costing deposits more than
offset a decrease in the  average  yield paid on  interest  costing  deposits to
3.91% for the quarter  ended  March 31,  1999 from 4.01% for the  quarter  ended
March 31, 1998.

For the nine months ended March 31, 1999  interest  expense  increased  $283,000
from the prior year period. The increase in interest expense in the current nine
month  period  was  the  result  of a  $9.4  million  increase  in  the  average
outstanding  balance of interest  costing  deposits to $103.4 million during the
nine months  ended March 31,  1999 from $93.9  million in the nine months  ended
March 31, 1998.  The average yield paid on interest  costing  deposits  remained
stable at 4.07% for both the nine month  periods  ended March 31, 1999 and March
31, 1998, respectively.

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,  the
Company's  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  risk  in the  loan  portfolio.
Non-performing  loans, net of specific  reserves,  totaled $295,000 at March 31,
1999 and consisted of $242,000 in four single family residential mortgage loans,
$38,000 in one  multi-family  residential  mortgage loan and $15,000 in consumer
loans.   General  loan  loss  reserves   totaled   $165,000  or  56.13%  of  net
non-performing loans at March 31, 1999. At March 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.

Non-Interest Income

Non-interest income increased $40,000 to $302,000 in the quarter ended March 31,
1999  compared  with  $262,000  in the year  earlier  period.  The  increase  in
non-interest  income in the  current  quarter  was  primarily  the  result of an
$18,000  increase  in loan  fees and  service  charges,  a $13,000  increase  in
commission income and a $10,000 increase in profit on the sale of loans compared
with the prior year period. The increase in loan fees and service charges in the
quarter  ended  March  31,  1999  is  primarily  attributed  to  increased  loan
origination  activity.  The  increases in  non-interest  income were offset by a
$9,000  reduction in deposit  related  fees in the quarter  ended March 31, 1999
compared with the prior year period.

                                      -11-

<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                     AND RESULTS OF OPERATIONS (continued)

Non-Interest Income (continued)

For the nine months ended March 31, 1999, non-interest income increased $106,000
to $923,000 from $817,000 in the prior year period. The increase in non-interest
income in the current nine month period is  primarily  attributed  to a $108,000
increase in loan fees and service  charges,  a $23,000 increase in profit on the
sale of loans and a $12,000 increase in commission  income,  offset by a $59,000
decrease in deposit  related fees.  The decrease in deposit  related fees during
the current nine month period is primarily  attributed to the  implementation of
system changes in the processing of demand deposit  in-clearings  related to the
conversion of the  Association's  customer account data processing  systems to a
new service  provider in October 1998.  These  critical data  processing  system
changes took longer to  implement  than had been  anticipated  resulting in some
lost fee income  associated with demand deposit  activity.  The reduction in fee
income associated with these changes is believed to be an isolated event that is
not anticipated to reoccur.

Non-Interest Expense

Non-interest  expense  increased  $84,000 to $918,000 in the quarter ended March
31,  1999  compared  to  $834,000  in the prior year  quarter.  The  increase in
non-interest expense in the current quarter is primarily the result of a $53,000
increase in  staffing  costs,  a $28,000  increase in  occupancy  and  equipment
expense,  an $8,000  increase in  computer  software  and support  expense and a
$6,000  increase in data  processing  costs.  These  increases  in  non-interest
expense in the current quarter were offset by reductions in advertising  expense
and real estate owned expense in the amounts of $8,000 and $6,000, respectively,
compared with the prior year period.

For the nine months ended March 31, 1999 non-interest expense increased $324,000
to $2.7 million from $2.4 million in the prior year period.  The primary factors
for the increase in non-interest expense in the current nine month period were a
$195,000 increase in staffing costs, a $41,000 increase in data processing fees,
a $37,000  increase  in  computer  software  and  support  expense and a $33,000
increase in occupancy and equipment  expense.  Advertising  expense  declined by
$12,000 in the current nine month period compared with the prior year period.

The increase in staffing  costs in both the three and nine month  periods  ended
March 31, 1999 is primarily  attributed  to an increase in  commissions  paid to
staff loan  originators as a result of increased loan origination  activity,  as
discussed above. The increases in computer software and support expense and data
processing  costs in both the three and nine month  periods ended March 31, 1999
are the result of costs associated with the conversion of the Company's  on-line
data processing systems to another service provider, as discussed above.

Income Taxes

Income  taxes  decreased  to $59,000 in the  quarter  ended  March 31, 1999 from
$76,000 for the prior year  quarter.  For the nine  months  ended March 31, 1999
income  taxes  decreased  to  $177,000  compared  to  $256,000 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

          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                     AND RESULTS OF OPERATIONS (continued)

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 March 31, 1999,  the  Association's  regulatory
liquidity  ratio was  49.8%.  At such  date,  the  Company  had  commitments  to
originate  $1.2 million in loans,  to sell $306,000 in loans,  no commitments to
purchase loans and no commitments to either purchase or sell securities.

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.  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 March 31, 1999 the Association had tangible and core capital of $8.2 million,
or 6.7% of adjusted total assets,  which was approximately $6.3 million and $4.5
million above the minimum  requirements in effect on that date of 1.5% and 3.0%,
respectively, of adjusted total assets.

At March 31, 1999 the Association  had total capital of $8.3 million  (including
$8.2 million in core  capital) and  risk-weighted  assets of $41.0  million,  or
total  capital of 20.3% of  risk-weighted  assets.  This amount was $5.1 million
above the 8.0% requirement in effect on that date.

                                      -13-

<PAGE>
                      MIDLAND CAPITAL HOLDINGS CORPORATION
                                AND SUBSIDIARIES

          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                     AND RESULTS OF OPERATIONS (continued)

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. 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.

RECENT DEVELOPMENTS

In April 1999 the Company opened a full service branch banking facility in Homer
Township, Will County,  Illinois, a southwest suburb of Chicago. Midland Federal
has entered into a long term retail lease for the Homer Township office premises
including a lease of contiguous  land for a drive-up  facility,  parking  and/or
future expansion.

IMPACT OF THE YEAR 2000

The Company's  data  processing  functions are performed by the  Association  or
outside  vendors.  The Association  has conducted a comprehensive  review of its
computer  systems to  identify  applications  that could be affected by the Year
2000 issue and has developed an  implementation  plan to address the issue.  The
Association  is in contact  with vendors and  providers  of critical  systems to
determine their progress in bringing such systems into Year 2000 compliance. The
Association  converted its on-line customer account data processing,  as well as
certain other critical data  processing and computer  systems,  to a new service
provider in October 1998,  as part of its plan to address Year 2000 issues.  The
Company estimates that it has spent approximately $250,000 in the current fiscal
year on computer system  upgrades  related to either the conversion or Year 2000
issues.  The Company  estimates  that future  expenditures  to address Year 2000
issues will be  approximately  $20,000 for additional  computer system upgrades.
Year 2000 testing of the Association's  on-line customer account data processing
system was  completed by March 31, 1999.  Completion of Year 2000 testing of the
Association's  other mission critical data processing  systems is anticipated by
June 30, 1999. The Company is currently developing a Year 2000 Contingency Plan,
which Plan is anticipated to be in place by June 30, 1999.


                                      -14-
<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

Not applicable.

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.

                                      -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:  May 13, 1999         BY: /s/ Paul Zogas
                                -------------------------------------
                                Paul Zogas
                                President, Chief Executive Officer
                                and Chief Financial Officer



DATE:  May 13, 1999         BY: /s/ Charles Zogas
                                -------------------------------------
                                Charles Zogas
                                Executive Vice President and
                                Chief Operating Officer


<PAGE>

                      MIDLAND CAPITAL HOLDINGS CORPORATION

EXHIBIT 11 - STATEMENT REGARDING COMPUTATION OF EARNINGS PER SHARE

<TABLE>
<CAPTION>

                                                   Three months ended   Nine months ended
                                                     March 31, 1999       March 31, 1999
                                                  -------------------  ------------------
<S>                                               <C>                  <C>

Net Income                                              $114,581              $342,465
                                                        ========              ========


Weighted average common shares outstanding
  for basic computation                                  363,975               363,975

                                                        ========              ========

Basic earnings per share                                $   0.31              $    .94
                                                        ========              ========



Weighted average common shares outstanding
  for basic computation                                  363,975               363,975

Common stock equivalents due to dilutive effect of
  stock options                                            4,406                 4,730
                                                        --------              ---------

Weighted average common shares and equivalents
  Outstanding for diluted computation                    368,381               368,705
                                                        ========              ========


Diluted earnings per share                              $   0.31               $   .93
                                                        ========              ========
</TABLE>