`CHEVY CHASE
                          PREFERRED CAPITAL CORPORATION
                                    FORM 10-Q
                                 March 31, 2003















 ______________________________________________________________________________

                       SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 20549

                                    FORM 10-Q

                QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                  For the quarterly period ended March 31, 2003

                       Commission File Number: 333-10495

                   CHEVY CHASE PREFERRED CAPITAL CORPORATION

             (Exact name of registrant as specified in its charter)

           Maryland                                      52-1998335
 (State or other jurisdiction of                       (I.R.S. Employer
 incorporation or organization)                       Identification No.)

                             7501 Wisconsin Avenue

                            Bethesda, Maryland 20814

               (Address of principal executive offices) (Zip Code)

                                 (301) 986-7000

              (Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

Yes  X  No
    ---   ---

The number of shares outstanding of the  registrant's  sole class of common
stock was 100 shares, $1 par value, as of April 30, 2003.

______________________________________________________________________________





                   CHEVY CHASE PREFERRED CAPITAL CORPORATION

                               TABLE OF CONTENTS

                         PART I - FINANCIAL INFORMATION

                                                                            Page
                                                                            ----
Item 1. Financial Statements:..................................................1
   (a)Statements of Financial Condition at March 31, 2003 and
       December 31, 2002.......................................................2
   (b)Statements of Operations for the Three Months Ended
       March 31, 2003 and 2002 ................................................3
   (c)Statement of Stockholders' Equity for the Three Months
       Ended March 31, 2003....................................................4
   (d)Statements of Cash Flows for the Three Months Ended
       March 31, 2003 and 2002 ................................................5
   (e)Notes to Financial Statements............................................6

Item 2. Management's Discussion and Analysis of Financial
         Condition and Results of Operations...................................8

Item 3. Quantitative and Qualitative Disclosures about Market Risk............11

Item 4. Controls and Procedures...............................................11

                           PART II - OTHER INFORMATION

Item 1. Legal Proceedings.....................................................12

Item 2. Changes in Securities.................................................12

Item 3. Defaults Upon Senior Securities.......................................12

Item 4. Submission of Matters to a Vote of Security Holders...................12

Item 5. Other Information.....................................................12

Item 6. Exhibits and Reports on Form 8-K......................................12









                                     PART I

ITEM 1. Financial Statements

The following unaudited financial  statements and notes of Chevy Chase Preferred
Capital  Corporation  (the  "Company")  have been  prepared in  accordance  with
generally accepted accounting principles for interim financial  information.  In
the opinion of management,  all adjustments necessary for a fair presentation of
the  financial  position and the results of  operations  for the interim  period
presented have been  included.  Such  unaudited  financial  statements and notes
should be read in conjunction with the Company's financial  statements and notes
for the year ended December 31, 2002 included in the Company's  Annual Report on
Form 10-K (File No. 333-10495) filed with the Securities and Exchange Commission
on March 27, 2003 (the "2002 10-K").

                                      -1-




                   CHEVY CHASE PREFERRED CAPITAL CORPORATION
                      STATEMENTS OF FINANCIAL CONDITION


                                                    March 31,       December 31,
                                                      2003              2002
                                                 -------------     -------------
                                                  (Unaudited)
                                     ASSETS

Cash and interest-bearing deposits               $  2,205,327      $  2,986,496
Residential mortgage loans (net of allowance
 for losses of $40,333 for both periods)          286,631,729       285,395,464
Accounts receivable from parent                    14,030,066        15,297,140
Accrued interest receivable                         1,097,936         1,138,246
Prepaid expenses                                       34,250             8,000
                                                 -------------     -------------
    Total assets                                  $303,999,308      $304,825,346
                                                 =============     =============

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Accounts payable to parent                       $     50,000      $        -
Accrued expenses and accounts payable to others        11,766               -
Dividends payable to parent                               -           1,100,000
Dividends payable to others                         3,890,625         3,890,625
                                                 -------------     -------------
   Total liabilities                                3,952,391         4,990,625
                                                 -------------     -------------
 Preferred Stock, 10,000,000 shares authorized:
 10 3/8% Noncumulative Exchangeable Preferred
 Stock, $5 par value, 3,000,000 shares issued
 and outstanding (liquidation value of
 $150,000,000 plus accrued and unpaid dividends)   15,000,000        15,000,000
Common stock, $1 par value, 1,000 shares
 authorized, 100 shares issued and outstanding            100               100
Capital contributed in excess of par              284,999,900       284,834,621
Retained earnings                                      46,917               -
                                                 -------------     -------------
   Total stockholders' equity                     300,046,917       299,834,721
                                                 -------------     -------------
   Total liabilities and stockholders' equity    $303,999,308      $304,825,346
                                                 =============     =============







               See the accompanying Notes to Financial Statements.
                                      -2-




                   CHEVY CHASE PREFERRED CAPITAL CORPORATION
                            STATEMENTS OF OPERATIONS
                                   (Unaudited)


                                                     Three Months Ended
                                                         March 31,
                                          --------------------------------------
                                                 2003                2002
                                          ------------------  ------------------
  Interest Income
     Residential mortgage loans               $  4,241,772        $  4,513,523
     Other                                           9,988              29,955
                                          ------------------  ------------------
       Total interest income                     4,251,760           4,543,478

  Operating Expenses
     Loan servicing fees paid to parent            226,608             240,684
     Advisory fees paid to parent                   50,000              50,000
     Directors fees                                  8,000               8,000
     General and administrative                     29,610              17,272
                                          ------------------  ------------------
       Total operating expenses                    314,218             315,956
                                          ------------------  ------------------

  NET INCOME                                  $  3,937,542        $  4,227,522
                                          ==================  ==================

  PREFERRED STOCK DIVIDENDS                      3,890,625           3,890,625
                                          ------------------  ------------------
  EARNINGS AVAILABLE TO
     COMMON STOCKHOLDER                       $     46,917        $    336,897
                                          ==================  ==================

  EARNINGS PER COMMON SHARE                   $     469.17        $   3,368.97
                                          ==================  ==================
















               See the accompanying Notes to Financial Statements.
                                      -3-





                   CHEVY CHASE PREFERRED CAPITAL CORPORATION
                       STATEMENT OF STOCKHOLDERS' EQUITY
                                   (Unaudited)


                                                      Capital
                                                    Contributed                    Total
                              Preferred    Common    In Excess      Retained    Stockholders'
                                Stock       Stock     of Par        Earnings       Equity
                             -----------    ----   ------------   ------------  -------------
Balance, December 31, 2002   $15,000,000    $100   $284,834,621    $      -     $299,834,721

Net income                           -       -              -       3,937,542      3,937,542

Capital contribution from
 common stockholder                  -       -          165,279           -          165,279

Dividends on 10 3/8%
 Noncumulative Exchangeable
 Preferred Stock, Series A           -       -               -     (3,890,625)    (3,890,625)
                             -----------    ----    ------------  ------------  -------------
Balance, March 31, 2003      $15,000,000    $100    $284,999,900   $   46,917   $300,046,917
                             ===========    ====    ============  ============  =============






















               See the accompanying Notes to Financial Statements.
                                      -4-





                   CHEVY CHASE PREFERRED CAPITAL CORPORATION
                            STATEMENTS OF CASH FLOWS
                                   (Unaudited)


                                                         Three Months Ended
                                                              March 31,
                                                    ----------------------------
                                                        2003           2002
                                                    -------------  -------------
Cash flows from operating activities:

Net income                                           $ 3,937,542    $ 4,227,522
Adjustments to reconcile net income to
 net cash provided by operating activities:
   Decrease in accounts receivable from parent          1,267,074      2,483,042
  (Increase) decrease in accrued interest receivable      40,310       (111,726)
  Increase in prepaid expenses                           (26,250)        (3,097)
  Increase (decrease) in accrued expenses and                                                             )
   accounts payable                                       61,766        (39,950)
  Increase in accounts payable to parent                     -           22,825
                                                    -------------  -------------
    Net cash provided by operating activities          5,280,442      6,578,616
                                                    -------------  -------------
Cash flows from investing activities:
  Purchases of residential mortgage loans            (55,709,307)   (42,897,263)
  Repayments of residential mortgage loans            54,473,042     39,290,624
                                                    -------------  -------------
    Net cash used in investing activities             (1,236,265)    (3,606,639)
                                                    -------------  -------------
Cash flows from financing activities:

  Capital contribution from common stockholder           165,279        341,082
  Dividends paid on preferred stock                   (3,890,625)    (3,890,625)
  Dividends paid on common stock                      (1,100,000)    (2,700,000)
                                                    -------------  -------------
    Net cash used in financing activities             (4,825,346)    (6,249,543)
                                                    -------------  -------------
Net decrease in cash and cash equivalents               (781,169)    (3,277,566)
Cash and cash equivalents at beginning of period       2,986,496      5,764,867
                                                    -------------  -------------
Cash and cash equivalents at end of period           $ 2,205,327    $ 2,487,301
                                                    =============  =============










               See the accompanying Notes to Financial Statements.
                                      -5-





                   CHEVY CHASE PREFERRED CAPITAL CORPORATION
                         NOTES TO FINANCIAL STATEMENTS
                                  (Unaudited)

NOTE 1 - ORGANIZATION AND BASIS OF PRESENTATION:

The Company is a Maryland  corporation  which  acquires,  holds and manages real
estate assets.  Chevy Chase Bank, F.S.B. (the "Bank"), a federally insured stock
savings bank, owns all of the Company's  common stock. The Bank is in compliance
with its regulatory capital requirements.

NOTE 2 - RESIDENTIAL MORTGAGE LOANS:

Residential mortgage loans consist of adjustable-rate mortgages ("ARMs"), and 30
year fixed-rate mortgages.  The ARMs have interest rates which are fixed for the
indicated period (one month, one year, three years,  five years,  seven years or
ten years) and which adjust thereafter based on the margin, index and frequency,
specified  in the  related  mortgage  note,  subject to  periodic  and  lifetime
interest rate caps. Each of the mortgage loans is secured by a mortgage, deed of
trust or other security instrument which created a first lien on the residential
dwellings located in their respective  jurisdictions.  The following table shows
the  residential  mortgage  loan  portfolio  by  type  at the  dates  indicated:


                                    March 31,          December 31,
                                      2003                2002
                                 --------------      --------------
    Monthly ARMs                  $ 62,535,604        $ 67,406,366
    One-year ARMs                   16,514,606          16,966,406
    Three-year ARMs                 18,644,623          20,126,451
    Five-year ARMs                  57,289,431          58,544,908
    7/1 ARMs                        16,421,009          16,056,192
    10/1 ARMs                       59,466,825          62,040,642
    30 year fixed-rate              55,799,964          44,294,832
                                 --------------      --------------
      Total                        286,672,062         285,435,797
    Less:
      Allowance for loan losses         40,333              40,333
                                 --------------      --------------
        Total                     $286,631,729        $285,395,464
                                 ==============      ==============

NOTE 3 - PREFERRED STOCK:

Cash  dividends on the Company's 10 3/8%  Noncumulative  Exchangeable  Preferred
Stock,  Series A ("the  Series A Preferred  Shares")  are payable  quarterly  in
arrears.  The  liquidation  value of each Series A  Preferred  Share is $50 plus
accrued and unpaid  dividends.  The Series A Preferred Shares are not redeemable
until  January 15, 2007 (except upon the  occurrence  of certain tax events) and
are  redeemable  thereafter  at the option of the Company.  Except under certain
limited

                                      -6-


                   CHEVY CHASE PREFERRED CAPITAL CORPORATION
                         NOTES TO FINANCIAL STATEMENTS
                                  (Unaudited)

NOTE 3 - PREFERRED STOCK (continued):

circumstances,  the  holders of the  Series A  Preferred  Shares  have no voting
rights.  The Series A Preferred Shares are automatically  exchangeable for a new
series of  preferred  stock of the Bank upon the  occurrence  of certain  events
relating to the Bank.

NOTE 4 - DIVIDENDS:

During the three months ended March 31, 2003,  the Company's  Board of Directors
declared a cash dividend of $3,890,625 on the Company's  preferred stock, out of
the retained earnings of the Company. The dividend was paid on April 15, 2003.

There were no common dividends  declared during the three months ended March 31,
2003.

                                      -7-



ITEM 2. Management's  Discussion and Analysis of Financial Condition and Results
        of Operations

FINANCIAL CONDITION

Residential Mortgage Loans

At March 31, 2003 and  December  31,  2002,  the Company  had  $286,631,729  and
$285,395,464,  respectively,  invested in loans  secured by first  mortgages  or
deeds of trust on single-family residential real estate properties ("Residential
Mortgage  Loans").  During the three months  ended March 31,  2003,  Residential
Mortgage  Loan  purchases  were  $55,709,307  and  principal   collections  were
$54,473,042.  Management  intends to continue to reinvest proceeds received from
repayments of loans in  additional  Residential  Mortgage  Loans to be purchased
from either the Bank or its affiliates.

At March 31, 2003, the Company had five non-accrual  loans  (contractually  past
due 90 days or more or with respect to which other  factors  indicate  that full
payment of  principal  and interest is  unlikely)  with an  aggregate  principal
balance of $913,440 (or 0.32% of loans).  At December 31, 2002,  the Company had
seven  non-accrual  loans with an aggregate  principal balance of $1,436,859 (or
0.50% of loans).

At March 31, 2003,  the Company had two loans which were  delinquent  30-89 days
with an aggregate principal balance of $528,083 (or 0.18% of loans). At December
31, 2002,  the Company had five loans which were  delinquent  30-89 days with an
aggregate principal balance of $1,307,482 (or 0.46% of loans).

Allowance for Loan Losses

An analysis is performed periodically to determine whether an allowance for loan
loss is required. An allowance may be provided after considering such factors as
the economy in lending areas,  delinquency  statistics and past loss experience.
The  allowance for loan losses is based on  estimates,  and ultimate  losses may
vary from current  estimates.  As adjustments to the allowance become necessary,
provisions  for loan losses are reported in  operations  in the periods that are
determined  to be  necessary.  There was no activity in the  allowance  for loan
losses during the three months ended March 31, 2003 and 2002. The balance of the
allowance  for loan losses was $40,333 for each of the quarters  ended March 31,
2003 and 2002.

Interest Rate Risk

The Company's  income  consists  primarily of interest  payments on  Residential
Mortgage Loans.  If there is a decline in interest rates,  then the Company will
experience a decrease in income available to be distributed to its stockholders.
Certain  Residential  Mortgage Loans which the Company holds allow  borrowers to
convert an ARM to a fixed-rate mortgage, thus "locking in" a fixed interest rate
at a time when interest  rates have declined.  In addition,  when interest rates
decline,  holders  of  fixed-rate  mortgages  are more  likely  to  prepay  such
mortgages.  In recent  periods,  primarily  as a result of a decline in interest
rates, the Company has experienced an increase in prepayments on its Residential
Mortgage Loans.

                                      -8-



Based on the outstanding balance of the Company's  Residential Mortgage Loans at
March 31, 2003 and the interest rates on such loans, anticipated annual interest
income, net of servicing fees, on the Company's loan portfolio was approximately
102.5% of the projected annual dividend on the Series A Preferred Shares.  There
can be no  assurance  that an  interest  rate  environment  in which  there is a
continued  decline in interest  rates would not  adversely  affect the Company's
ability to pay dividends on the Series A Preferred Shares. The Company, to date,
has not used any  derivative  instruments  to manage  its  interest  rate  risk.


There have been no material  changes to the  Company's  market risk  disclosures
from the disclosures made in the Form 10-K for 2002.

Significant Concentration of Credit Risk

Concentration of credit risk arises when a number of customers engage in similar
business  activities,  or activities in the same  geographical  region,  or have
similar  economic  features that would cause their  ability to meet  contractual
obligations  to  be  similarly  affected  by  changes  in  economic  conditions.
Concentration of credit risk indicates the relative sensitivity of the Company's
performance  to both positive and negative  developments  affecting a particular
industry.

The Company's exposure to geographic  concentrations directly affects the credit
risk of the  Residential  Mortgage  Loans within the  portfolio.  A majority (or
54.4%) of the Company's  Residential  Mortgage  Loans are secured by residential
real estate properties located in the Washington,  DC metropolitan area. Service
industries and Federal, state and local governments employ a significant portion
of the Washington, DC area labor force. Consequently, these loans may be subject
to a greater risk of default than other comparable residential mortgage loans in
the event of adverse  economic,  political or business  developments and natural
hazards in the region that may affect the ability of residential property owners
in the region to make  payments of  principal  and  interest  on the  underlying
mortgages.

Liquidity and Capital Resources

The  objective  of  liquidity  management  is  to  ensure  the  availability  of
sufficient  cash flows to meet all of the Company's  financial  commitments.  In
managing  liquidity,  the Company takes into account  various legal  limitations
placed on a real estate investment trust (a "REIT"),  as discussed below in "Tax
Status of the Company."

The  Company's  principal  liquidity  needs will be to fund the  acquisition  of
additional  mortgage  assets as current  mortgage assets held by the Company are
repaid and to pay dividends on the Series A Preferred Shares. The acquisition of
such additional  mortgage assets will be funded with the proceeds from principal
repayments  on its current  portfolio of mortgage  assets.  The Company does not
anticipate  that it will  have any  other  material  capital  expenditures.  The
Company  believes that cash generated from the payment of principal and interest
on its  mortgage  asset  portfolio  will  provide  sufficient  funds to meet its
operating  requirements and to pay dividends in accordance with the requirements
to be treated as a REIT for income tax purposes for the foreseeable  future. The
Company may borrow funds as it deems necessary.


                                      -9-



Tax Status of the Company

The Company has elected to be taxed as a REIT under  Sections 856 through 860 of
the Internal Revenue Code of 1986, as amended.  As a REIT, the Company generally
will not be subject to federal income tax on its net income  (excluding  capital
gains) provided that it distributes  annually 100% of its REIT taxable income to
its stockholders, meets certain organizational,  stock ownership and operational
requirements  and meets certain income and asset tests. To remain qualified as a
REIT,  the Company must  distribute  each year at least 90% of its "REIT taxable
income" (not including capital gains) for that year to stockholders.  If, in any
taxable year,  the Company fails to qualify as a REIT,  the Company would not be
allowed a deduction for  distributions  to stockholders in computing its taxable
income  and would be  subject to federal  and state  income tax  (including  any
applicable  alternative  minimum tax) on its taxable income at regular corporate
rates. In addition,  the Company would also be disqualified  from treatment as a
REIT for the four taxable years  following  the year during which  qualification
was lost.

No income tax was paid during  either of the three month periods ended March 31,
2003 and 2002.

RESULTS OF OPERATIONS

Three Months Ended March 31, 2003 Compared to Three Months Ended March 31, 2002

During the three months ended March 31, 2003 and 2002, the Company  reported net
income of $3,937,542 and $4,227,522, respectively.

Interest income on Residential  Mortgage Loans totaled  $4,241,772 for the three
months ended March 31, 2003 (the "2003 quarter"), compared to $4,513,523 for the
three months ended March 31, 2002 (the "2002 quarter"). The decrease in interest
income  resulted  from a decrease in the average yield on such loans to 5.97% in
the 2003  quarter  from 6.25% in the 2002  quarter.  The average  balance of the
Residential  Mortgage  Loan  portfolio  was  $284,438,334  in the  2003  quarter
compared to $288,776,317 in the 2002 quarter. The Company would have recorded an
additional  $11,327 and $21,643 in interest  income for the three  months  ended
March 31, 2003 and 2002,  had its  non-accrual  loans been current in accordance
with their original terms.

Other  interest  income of $9,988 and $29,955 was  recognized  on the  Company's
interest bearing deposits during the three months ended March 31, 2003 and 2002,
respectively.  The  decrease  was  primarily  due to a lower  average  yield  on
interest  bearing  deposits  which  decreased by 216 basis points (from 3.48% to
1.32%) from the average yield in the 2002  quarter.  Partially  offsetting  this
decrease was an increase in the average balance on interest  bearing deposits of
$765,889 in the 2003 quarter.

                                      -10-




No  provision  for loan losses was recorded for the three months ended March 31,
2003 and 2002.

The Company did not sell any REO properties  during the three months ended March
31, 2003 and 2002.

Operating  expenses  totaling  $314,218  and $315,956 for the three months ended
March 31, 2003 and 2002,  respectively,  were  comprised of loan  servicing fees
paid to parent,  advisory  fees paid to parent,  directors  fees and general and
administrative  expenses.  Loan  servicing  fees paid to parent of $226,608  and
$240,684, for the three months ended March 31, 2003 and 2002, respectively, were
based on a servicing fee rate of 0.375% per annum of the  outstanding  principal
balances of  Residential  Mortgage  Loans,  pursuant  to a  servicing  agreement
between  the Company  and the Bank.  Advisory  fees paid to parent for the three
months  ended  March  31,  2003  and 2002  totaled  $50,000  for  each  quarter.
Directors'  fees paid for the three months ended March 31, 2003 and 2002 totaled
$8,000  for each  period,  and  represent  compensation  to the two  independent
members of the Board of Directors.  General and administrative  expenses totaled
$29,610  and  $17,272  for the  three  months  ended  March  31,  2003 and 2002,
respectively.

On March  18,  2003,  the  Company's  Board of  Directors  declared,  out of the
retained earnings of the Company,  a cash dividend of $1.296875 per share on the
outstanding Series A Preferred Shares.

There were no common dividends declared during the quarter ended March 21, 2003.

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk

Information  required  by  this  item  is  included  in  Item  2,  "Management's
Discussion  and  Analysis of  Financial  Condition  and Results of  Operations -
Interest  Rate  Risk,"  which  is  hereby   incorporated  herein  by  reference.

ITEM 4. Controls and Procedures

Within the 90-day period prior to the date of this report,  the Company  carried
out an  evaluation,  under the  supervision  and with the  participation  of the
Company's management,  including the Company's Chief Executive Officer and Chief
Financial  Officer,  of the  effectiveness  of the design and  operation  of the
Company's  disclosure controls and procedures.  Based upon that evaluation,  the
Chief Executive Officer and Chief Financial Officer concluded that the Company's
disclosure  controls and  procedures  are  effective in timely  alerting them to
material  information  relating  to the  Company  required to be included in the
Company's  filings  under  the  Securities  Exchange  Act of 1934,  as  amended.


There have been no significant changes in the Company's internal controls, or in
other factors that could significantly  affect internal controls,  subsequent to
the date the Company carried out its evaluations.

                                      -11-





                          PART II - OTHER INFORMATION

ITEM 1. Legal Proceedings

The Company is not the subject of any material litigation.  None of the Company,
the Bank or any  affiliate  of the Bank is  currently  involved  in nor,  to the
Company's  knowledge,  is currently threatened with any material litigation with
respect to the Residential Mortgage Loans included in the portfolio,  other than
routine litigation arising in the ordinary course of business,  most of which is
covered by liability insurance.

ITEM 2. Changes in Securities

None.

ITEM 3. Defaults Upon Senior Securities

None.

ITEM 4.  Submission of Matters to a Vote of Security Holders

None.

ITEM 5. Other Information

None.

ITEM 6. Exhibits and Reports on Form 8-K

(a) Exhibits required by Item 601 of Regulation S-K are set forth below.

Exhibit
 No.          Exhibit
------------------------
11    Computation of Earnings Per Common Share included in Part I, Item 1 of
       this report
99.1  Certification of Chief Executive Officer, Pursuant to 18 U.S.C. Section
       1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99.2  Certification of Chief Financial Officer, Pursuant to 18 U.S.C. Section
       1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

                                      -12-






                                   SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                    CHEVY CHASE PREFERRED CAPITAL CORPORATION
                                  (Registrant)


May 15, 2003                   By:  /s/ ALEXANDER R. M. BOYLE
                                    ------------------------------------
                                    Alexander R. M. Boyle
                                    Vice Chairman of the Board


May 15, 2003                   By:  /s/ STEPHEN R. HALPIN, JR.
                                    ------------------------------------
                                    Stephen R. Halpin, Jr.
                                    Executive Vice President and
                                    Chief Financial Officer
                                    (Principal Financial Officer)


May 15, 2003                   By:  /s/ JOEL A. FRIEDMAN
                                    ------------------------------------
                                    Joel A. Friedman
                                    Senior Vice President and Controller
                                    (Principal Accounting Officer)






                                 CERTIFICATION

I, B. Francis Saul, II, certify that:

1.   I have reviewed this quarterly report on Form 10-Q of Chevy Chase Preferred
     Capital Corporation;


2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange  Act Rules 13a-14 and 15d-14) for the  registrant  and we have:
     (a)  designed  such  disclosure  controls  and  procedures  to ensure  that
     material information relating to the registrant, including its consolidated
     subsidiaries,  is  made  known  to  us by  others  within  those  entities,
     particularly  during  the period in which  this  quarterly  report is being
     prepared;  (b) evaluated the  effectiveness of the registrant's  disclosure
     controls  and  procedures  as of a date  within 90 days prior to the filing
     date of this quarterly report (the "Evaluation Date"); and (c) presented in
     this  quarterly  report  our  conclusions  about the  effectiveness  of the
     disclosure  controls  and  procedures  based  on our  evaluation  as of the
     Evaluation Date;

5.   The registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee  of  registrant's   board  of  directors:

     (a)  all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     (b)  any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and



6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.


Date:  May 15, 2003                     /s/ B. FRANCIS SAUL, II
                                        --------------------------
                                        B. Francis Saul, II
                                        Chairman and Chief Executive Officer





                                 CERTIFICATION

I, Stephen R. Halpin, Jr., certify that:

1.   I have reviewed this quarterly report on Form 10-Q of Chevy Chase Preferred
     Capital Corporation;

2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange  Act Rules 13a-14 and 15d-14) for the  registrant  and we have:
     (a)  designed  such  disclosure  controls  and  procedures  to ensure  that
     material information relating to the registrant, including its consolidated
     subsidiaries,  is  made  known  to  us by  others  within  those  entities,
     particularly  during  the period in which  this  quarterly  report is being
     prepared;  (b) evaluated the  effectiveness of the registrant's  disclosure
     controls  and  procedures  as of a date  within 90 days prior to the filing
     date of this quarterly report (the "Evaluation Date"); and (c) presented in
     this  quarterly  report  our  conclusions  about the  effectiveness  of the
     disclosure  controls  and  procedures  based  on our  evaluation  as of the
     Evaluation Date;

5.   The registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee  of  registrant's   board  of  directors:

     (a)  all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls;  and

     (b)  any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and




6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.


Date:  May 15, 2003                     /s/ STEPHEN R. HALPIN, JR.
                                        --------------------------
                                        Stephen R. Halpin, Jr.
                                        Chief Financial Officer and
                                        Executive Vice President







                                   Exhibit 11


Computation  of  Earnings  Per Common  Share  included in Part I, Item 1 of this
report.





                                                                   Exhibit 99.1

                    CERTIFICATION OF CHIEF EXECUTIVE OFFICER

           PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO
                 SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

     The  undersigned,  B. Francis  Saul,  II, the Chairman and Chief  Executive
Officer of Chevy  Chase  Preferred  Capital  Corporation  (the  "Company"),  has
executed this  certification  in connection  with the filing with the Securities
and Exchange  Commission of the Company's  Quarterly Report on Form 10-Q for the
period ended March 31, 2003 (the  "Report").  The undersigned  hereby  certifies
that:

     (1)  the Report fully  complies with the  requirements  of Section 13(a) or
          15(d) of the Securities Exchange Act of 1934; and

     (2)  the  information  contained  in the  Report  fairly  presents,  in all
          material respects,  the financial  condition and results of operations
          of the Company.


Date:  May 15, 2003                     /s/ B. FRANCIS SAUL, II
                                        --------------------------
                                        B. Francis Saul, II
                                        Chairman and Chief Executive Officer







                                                                   Exhibit 99.2

                    CERTIFICATION OF CHIEF FINANCIAL OFFICER

           PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO
                 SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

     The undersigned,  Stephen R. Halpin,  Jr., the Executive Vice President and
Chief  Financial  Officer of Chevy  Chase  Preferred  Capital  Corporation  (the
"Company"),  has executed this  certification in connection with the filing with
the Securities and Exchange Commission of the Company's Quarterly Report on Form
10-Q for the period ended March 31, 2003 (the "Report").  The undersigned hereby
certifies that:

     (1)  the Report fully  complies with the  requirements  of Section 13(a) or
          15(d) of the Securities Exchange Act of 1934; and

     (2)  the  information  contained  in the  Report  fairly  presents,  in all
          material respects,  the financial  condition and results of operations
          of the Company.


Date:  May 15, 2003                     /s/ STEPHEN R. HALPIN, JR.
                                        --------------------------
                                        Stephen R. Halpin, Jr.
                                        Chief Financial Officer and
                                        Executive Vice President`