UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities  Exchange
Act of 1934 For the period ended March 31, 1997

                                       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            1-6707
                                 --------

                              Providian Corporation
--------------------------------------------------------------------------------
             (Exact name of Registrant as specified in its charter)

                 Delaware                               51-0108922
-------------------------------------------      --------------------------
     (State or other jurisdiction of                (I.R.S. Employer
      incorporation or organization)                Identification No.)

    400 West Market Street, Louisville, Kentucky              40202
------------------------------------------------           -----------
      (Address of principal executive offices)             (Zip Code)


Registrant's telephone number, including area code     (502) 560-2000
                                                       --------------
                    
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 and (2) has been subject to such filing requirements for
the past 90 days. Yes X No ___.

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock as of April 30, 1997.

                 Class                                    Shares Outstanding
    -----------------------------                         ------------------
     Common Stock, $1.00 par value                             94,599,880





<PAGE>

Part I - FINANCIAL INFORMATION
Item 1. Financial Statements

                            PROVIDIAN CORPORATION AND SUBSIDIARIES
                   CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

                                                      March 31,   
                                                       1997         December 31,
                                                    (Unaudited)          1996
                                                    -----------     -----------
(Amounts in millions)                                
Assets
Investments:
  Bonds and stocks, available for sale
   (Amortized cost of $11,289 and $11,111
     in 1997 and 1996, respectively)                     $ 11,341    $ 11,407
  Trading account securities                                  108          96
  Commercial mortgage loans                                 2,801       2,864
  Residential mortgage loans                                2,562       2,718
  Consumer loans, net                                       2,643       2,810
  Consumer loans held for securitization                       --         740
  Policy loans                                                488         487
  Other investments                                           838         843
                                                         --------    --------
                                   Total Investments       20,781      21,965

  Cash and cash equivalents                                 1,598         904
  Deferred policy and loan acquisition costs                1,533       1,508
  Value of insurance in force purchased                       232         237
  Goodwill                                                    200         202
  Separate account assets                                   3,537       3,240
  Other assets                                              1,098         937
                                                         --------    --------
                                        Total Assets     $ 28,979    $ 28,993
                                                         ========    ========

Liabilities and Shareholders' Equity
Liabilities:
  Benefit reserves and other policy liabilities          $  4,206    $  4,189
  Individual annuity reserves                               5,452       5,479
  Group annuity deposits                                    7,155       7,170
  Banking deposits                                          2,993       3,390
  Separate account liabilities                              3,537       3,240
  Long-term debt issued by:
    Corporate                                                 668         718
    Bancorp                                                    50          50
  Deferred federal income tax                                 337         414
  Other liabilities                                         1,253       1,153
                                                         --------    --------
                                   Total Liabilities       25,651      25,803

Commitments and Contingencies

Providian Bancorp-Obligated Mandatorily
   Redeemable Capital Securities of Subsidiary
   Trust Holding Solely Junior Subordinated
   Deferrable Interest Debentures of Providian Bancorp        160          --

Company-Obligated Mandatorily Redeemable
   Preferred Securities of Providian LLC                      100         100

Shareholders' Equity:
  Common stock, $1 par                                        115         115
  Additional paid-in capital                                   46          44
  Net unrealized investment gain                               36         182
  Retained earnings                                         3,200       3,109
  Common stock held in treasury - at cost:
    1997 - 20.7 shares;
    1996 - 21.6 shares                                       (321)       (356)
  Unearned restricted stock                                    (8)         (4)
                                                         --------    --------
                          Total Shareholders' Equity        3,068       3,090
                                                         --------    --------
          Total Liabilities and Shareholders' Equity     $ 28,979    $ 28,993
                                                         ========    ========

See notes to condensed consolidated financial statements.
                  


<PAGE>


 Item 1. (continued)
                                 PROVIDIAN CORPORATION AND SUBSIDIARIES
                         CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)


Three Months Ended March 31                                        1997     1996
                                                                  ------   -----
                                                                  (Amounts in 
                                                                millions, except
                                                               per common share)
Revenues:
  Premiums and other considerations                                  $304   $299
  Investment income, net of expenses                                  495    468
  Consumer loan servicing fees                                         91     67
  Realized investment gain                                              3      5
  Other income, net                                                    58     42
                                                                     ----   ----
                                                   Total Revenues     951    881

Benefits and Expenses:
  Benefits and claims                                                 241    236
  Increase in benefit and contract reserves                           216    191
  Commissions, net                                                     20     22
  General, administrative and other expenses, net                     218    177
  Amortization of deferred policy and loan acquisition costs,
     value of insurance in force purchased and goodwill                65     77
  Interest expense                                                     21     29
                                                                     ----   ----
                                      Total Benefits and Expenses     781    732
                                                                     ----   ----

                                 Income before Federal Income Tax     170    149

Federal Income Tax                                                     50     45
                                                                     ----   ----

                                   Net Income before Dividends on
                                           Mandatorily Redeemable
                                             Preferred Securities     120    104

Redeemable Capital Securities of Subsidiary Trust
 Holding Solely Junior Subordinated Deferrable
 Interest Debentures of Providian Bancorp                               2     --

Dividends on Company-Obligated Mandatorily
Redeemable Preferred Securities of Providian LLC                        1      1
                                                                     ----   ----

                                                       Net Income    $117   $103
                                                                     ====   ====

                                     Net Income per Common Share    $1.24  $1.09
                                                                     ====   ====

Cash Dividends per Common Share                                      $.275  $.25
                                                                     ====   ====

Weighted Average Number of Common Shares
  Outstanding During the Period                                      94.2   93.9
                                                                     ====   ====

See notes to condensed consolidated financial statements.


<PAGE>

<TABLE>

Item 1.  (continued)
                                PROVIDIAN CORPORATION AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

Three Months Ended March 31                                       1997        1996
                                                            ----------  ----------
                                                            (Amounts in millions)
<S>                                                           <C>         <C> 

Net Cash Flows provided by Operations                          $   273    $   369

Cash Flows from Investment Activities:
Investments sold or matured                                      2,364      2,414
Cost of securities and mortgage loans acquired                  (2,420)    (2,057)
Additions to operating property                                    (12)       (11)
Net increase in consumer loans                                    (151)      (662)
Securitization of consumer loans                                 1,350        375
Purchase of securitized consumer loans                            (325)        --
All other investment activities                                    (55)       (15)
                                                               -------    -------

Net Cash Flows provided by Investment Activities                   751         44

Cash Flows from Financing Activities:
Net increase (decrease) in short-term borrowings                   179       (119)
Policyholder contract deposits                                     638        298
Withdrawals of policyholder contract deposits                     (852)      (893)
Net increase (decrease) in banking deposits                       (397)       277
Issuance of long-term debt by:
Corporate                                                           --         56
Bancorp                                                             --         50
Repayment of long-term debt                                        (50)       (25)
Net borrowings (repayments) on revolving line of credit             (5)        15
Issuance of Providian Bancorp Obligated Preferred Securities       160         --
Purchase of common stock for treasury                               --        (50)
Dividends                                                          (26)       (23)
Proceeds from exercise of stock options                             23          5
                                                               -------    -------

Net Cash Flows (used in) Financing Activities                     (330)      (409)
                                                               -------    -------

Net Increase in Cash and Cash Equivalents                          694          4

Cash and Cash Equivalents at Beginning of Period                   904        708
                                                               -------    -------

Cash and Cash Equivalents at End of Period                     $ 1,598    $   712
                                                               =======    =======

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


<PAGE>


                     PROVIDIAN CORPORATION AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

A.   The accompanying  unaudited condensed  consolidated  financial  statements
     have been prepared in accordance with the  instructions to Form 10-Q and in
     conformity with generally  accepted  accounting  principles and reflect all
     adjustments  which are, in the opinion of management,  necessary for a fair
     presentation  of the results for the interim  periods  presented.  All such
     adjustments are of a normal recurring nature. The results of operations for
     the three-month period ended March 31, 1997 are not necessarily  indicative
     of the results to be expected  for the full year ending  December 31, 1997.
     These unaudited condensed  consolidated financial statements should be read
     in conjunction  with the  consolidated  financial  statements and footnotes
     included in Providian Corporation's annual report on Form 10-K for the year
     ended December 31, 1996.

B.   On December 28, 1996, Providian  Corporation executed a Plan and Agreement
     of Merger  and  Reorganization  (the  "Merger  Agreement")  with AEGON N.V.
     ("AEGON") and LT Merger Corp., a wholly owned  subsidiary of AEGON ("Merger
     Sub"), pursuant to which Merger Sub will merge with Providian  Corporation.
     In  connection  with  this  merger,  Providian  Corporation  will  spin-off
     Providian  Bancorp,  Inc.  to  Providian   Corporation   shareholders  (the
     "Distribution").  For each  share of  Providian  Corporation  stock  owned,
     shareholders  will  receive  one share of  Providian  Bancorp  Inc.  in the
     Distribution.  Pursuant to the merger  agreement,  among other things,  (a)
     Providian  Corporation will be the surviving  corporation in the merger and
     become a wholly owned  subsidiary  of AEGON,  and (b) each  shareholder  of
     Providian  Corporation  will be  entitled  to a number  of  shares of AEGON
     common  stock in  exchange  for shares of  Providian  Corporation's  common
     stock.

      The merger is  subject to  approval  by  various  regulatory  authorities,
     approval  by  Providian   Corporation's   shareholders  and  certain  other
     conditions.  The  Distribution  will  occur  only  if  all  the  conditions
     necessary for the merger are satisfied.  Because consummation of the merger
     and Distribution is subject to the above conditions, no representations can
     be made as to  whether,  or  when,  the  merger  and  Distribution  will be
     completed or as to the possible  impact of the merger and  Distribution  on
     the financial condition and results of operations of Providian  Corporation
     should the merger and Distribution occur.

C.   Per common share amounts have been calculated  using net income divided by
     the  weighted  average  number  of common  shares  outstanding  during  the
     three-month  period.  Fully  diluted  net income  per  common  share is not
     presented as it approximates net income per common share.

D.   Consumer  loans  have been  reduced  by the  sale,  without  recourse,  of
     unsecured  receivables under asset securitization plans during 1997 of $1.4
     billion.   Total   unsecured   consumer   receivables   outstanding   under
     securitization plans were $6.4 billion at March 31, 1997.

E.   Effective January 1, 1997,  Providian  Corporation  prospectively  adopted
     SFAS No. 125,  "Accounting for Transfers and Servicing of Financial  Assets
     and  Extinguishments  of  Liabilities",  which  provides new accounting and
     reporting   standards   for  sales,   securitizations,   and  servicing  of
     receivables and other financial assets and  extinguishments of liabilities.
     The application of SFAS No. 125 to monthly sales of receivables  originated
     prior  to  January  1,  1997  is   estimated  to  increase  net  income  by
     approximately  $24.0  million for the year ended  December 31,  1997,  as a
     result of  recognizing  gains  upon the dates of  transfer  as  opposed  to
     recognizing  servicing  income as it is  received  monthly.  This impact is
     non-recurring  because for the first six to eight months of 1997, Providian
     Corporation  will  recognize  both excess  servicing  income  generated  by
     balances existing as of December 31, 1996, and gains on additional  monthly
     sales into these existing  transactions  during 1997. The amount and timing
     of any increase in income resulting from the application of SFAS No. 125 to
     transactions originated prior to January 1, 1997 are, however, dependent on
     the performance of the underlying  receivables.  The impact of the adoption
     of SFAS No. 125 to transactions originated subsequent to January 1, 1997 is
     dependent on the amount and timing of future securitizations.

F.   An analysis of the  allowance  for loan  losses on consumer  and  mortgage
     loans  for the  three-month  period  ended  March  31,  1997 and 1996 is as
     follows:

                                              Consumer       Mortgage
                                           --------------- -----------
         Three Months Ended March 31        1997    1996   1997  1996
                                           --------------- -----------
                                               (Dollars in millions)
          Balance at beginning of period   $ 115    $ 93    $43   $50
          Current period provision            33      28      1     2
          Current period chargeoffs,
          net of recoveries                  (29)    (23)    --    --
                                           =====    ====    ===   ===
          Balance at end of period         $ 119    $ 98    $44   $52
                                           =====    ====    ===   ===


G.   On  February 4, 1997,  Providian  Bancorp  completed a capital  securities
     transaction  pursuant  to which a  subsidiary  trust of  Providian  Bancorp
     issued  $160.0  million in  liquidation  amount of  mandatorily  redeemable
     preferred  securities  (the "Capital  Securities").  The  subsidiary  trust
     invested the proceeds in 9.525%  Junior  Subordinated  Deferrable  Interest
     Debentures (the "Debentures")  issued by Providian Bancorp.  In addition to
     its  obligations  under the  Debentures,  Providian  Bancorp has guaranteed
     payments  on the  Capital  Securities  to the  extent of funds  held by the
     subsidiary trust. Providian Bancorp used the proceeds from this transaction
     for the retirement of $42.5 million of long-term debt and the redemption of
     $63.3 million of preferred stock, both held by Providian  Corporation,  and
     for general Providian Bancorp business purposes. Providian Corporation will
     use the proceeds to redeem,  in whole,  on May 19, 1997,  $95.0  million in
     outstanding  principal  amount of the 8.75%  Sinking Fund  Debentures,  due
     January 15, 2017 at a total  redemption price of $99.2 million plus accrued
     interest.

     During the three months ended March 31, 1997,  $50.0 million of medium term
     notes matured.


<PAGE>


Item 2.  MANAGEMENT'S  DISCUSSION  AND ANALYSIS OF FINANCIAL  CONDITION AND
         RESULTS OF OPERATIONS

This  item  presents   specific   comments  on  material  changes  to  Providian
Corporation  and  it's  subsidiaries  ("the  Company")  results  of  operations,
financial  condition,  liquidity and capital resources for the periods reflected
in the condensed  consolidated financial statements filed with this report. This
analysis should be read in conjunction with the financial statements,  footnotes
and management's discussion and analysis included in the Company's annual report
on Form 10-K for the year ended December 31, 1996.

This  Management's  Discussion  and Analysis  contains  certain  forward-looking
statements that involve risks and uncertainties.  The terms "expects,"  "plans,"
"believes,"  "intends," "will  continue," "may continue" or similar  expressions
are intended to identify such  forward-looking  statements.  Such statements are
not guarantees of future  performance and involve  certain risks,  uncertainties
and  assumptions  which may cause the  Company's  actual  results  or actions to
differ  materially  from those  expressed  or  implied  by such  forward-looking
statements.  Factors that could cause or contribute to such material differences
include those listed under Planned Merger and  Reorganization and are beyond the
Company's ability to control or predict.  Readers are cautioned not to put undue
reliance on forward-looking statements.

PLANNED MERGER AND REORGANIZATION

As discussed in management's  discussion and analysis  included in the Company's
annual report on Form 10-K for the year ended December 31, 1996, on December 28,
1996,  Providian  Corporation  executed  a Plan  and  Agreement  of  Merger  and
Reorganization (the "Merger Agreement") with AEGON N.V. ("AEGON"), and LT Merger
Corp.,  a wholly owned  subsidiary of AEGON  ("Merger  Sub"),  pursuant to which
Merger  Sub will merge  with  Providian  Corporation.  In  connection  with this
merger, Providian Corporation will spin-off Providian Bancorp, Inc. to Providian
Corporation shareholders (the "Distribution").

The merger is subject to approval by various regulatory authorities, approval by
Providian  Corporation's  shareholders  and certain  other  conditions.  Because
consummation of the merger and the Distribution is subject to these  conditions,
no  representations  can  be  made  as to  whether,  or  when,  the  merger  and
Distribution  will be completed  or as to the possible  impact of the merger and
Distribution on the financial condition and results of operations of the Company
should the merger and Distribution occur.


<PAGE>


RESULTS OF OPERATIONS

The following discussion compares the results of operations for the three months
ended March 31, 1997 to the three months ended March 31, 1996.

CONSOLIDATED RESULTS

Providian's  net income for the  quarter  ended  March 31,  1997,  was $1.24 per
common share,  up 13.8 percent from the $1.09 per common share  reported for the
same  period in 1996.  Net income of $116.7  million  for the  quarter  included
pretax  realized  gains  of  $3.0  million,   comprised  of  realized  gains  on
investments  and  securities of $4.6 million and $1.6 million in provisions  for
mortgage loan losses.

Earnings, as discussed herein,  exclude realized investment gains and losses and
related deferred acquisition cost amortization,  net of taxes.  Earnings for the
quarter ended March 31, 1997,  were $118.0 million or $1.22 per common share, up
14.0  percent  from the $1.07 per common  share  reported  in the same period in
1996. The discussion under "Business  Segment Results"  highlights the key items
which contributed to the overall growth in earnings.

Revenues,  as discussed  herein,  exclude realized  investment gains and losses.
Revenues  for the quarter  ended March 31,  1997,  were $948.1  million,  up 8.2
percent from $876.0  million  reported in the same period in 1996.  The increase
was  primarily a result of higher life  annuity  premiums at  Providian  Capital
Management  and revenues  earned on Providian  Bancorp's  strong growth in total
managed loans.  Providian  Bancorp's  revenues,  primarily  interest  income and
consumer loan servicing fees,  increased $56.0 million for the quarter,  or 25.0
percent, from the same period in 1996. The increase is primarily a result of the
$34.2 million gain recognized on Providian Bancorp's 1997 securitizations  under
Statement of Financial  Accounting  Standards No. 125, "Accounting for Transfers
and Servicing of Financial Assets and Extinguishments of Liabilities," which was
adopted January 1, 1997. Additionally,  interest income increased from growth in
receivables.

Total benefits and expenses  increased  $50.0 million,  or 6.8 percent,  for the
quarter ended March 31, 1997 from the same period in 1996. Benefits and reserves
increased $29.4 million for the quarter, or 6.9 percent, from the same period in
1996.  The increase is primarily due to Providian  Capital  Management's  higher
life annuity volume and Providian  Bancorp's  growth in average deposits on hand
offset by Providian  Direct Insurance  improved claims  experience in the direct
auto line of the Property  and Casualty  segment.  General,  administrative  and
other expenses were up $42.0 million for the quarter, or 23.8 percent,  from the
same period in 1996. The increase primarily  reflected higher servicing expenses
by  Providian  Bancorp  due to  significant  on-balance  sheet  loan  growth and
increased  marketing  activity.  Amortization  decreased  $12.0  million for the
quarter,  or 15.5 percent,  from the same period in 1996. The decrease reflected
Providian   Bancorp's   accelerated   amortization   in   connection   with  the
securitization of a portion of Providian Bancorp's home equity loan portfolio in
first quarter 1996 and Providian Capital  Management's  recognition of continued
better than expected annuity lapse experience in 1997. 

BUSINESS SEGMENT RESULTS

PROVIDIAN BANCORP

Providian Bancorp continued its strong  performance with pretax earnings,  after
dividends  on Capital  Securities,  of $61.7  million for the  quarter,  up 20.2
percent,  from the same period in 1996. These results reflected strong growth in
managed  unsecured  receivables  and fee-based  revenues,  reflecting  increased
diversification in fee-based products and value added services to customers.

Total managed loans were $9.2 billion as of March 31, 1997, up 28.2 percent from
$7.1 billion as of March 31, 1996. Managed unsecured receivables, including $5.9
billion of securitized  receivables,  were $7.7 billion as of March 31, 1997, up
$1.6 billion from March 31, 1996,  as a result of the  continued  success of the
Primary Lender program. The managed home equity loan portfolio, including $485.0
million of securitized receivables,  was $938.9 million as of March 31, 1997, up
$175.6 million from March 31, 1996.

The net interest margin for managed unsecured  receivables was 11.05 percent for
the quarter ended March 31, 1997,  compared to 11.88 percent for the same period
in 1996. The decrease resulted from the three-month,  zero percent  introductory
rate feature  offered to attract new customers into the Primary Lender  program.
Loan loss reserves related to on-balance sheet unsecured receivables,  excluding
receivables  held for  securitization,  were 5.03  percent  at March  31,  1997,
compared  to 4.51  percent at December  31,  1996 and 4.19  percent at March 31,
1996.  The net  credit  loss rate for  managed  unsecured  receivables  was 6.73
percent for the quarter,  up from 5.07 percent for the same period in 1996 which
is consistent with current  industry trends.  Balances  past-due greater than 31
days related to  on-balance  sheet  unsecured  receivables  were 2.54 percent at
March 31,  1997 down from 2.56  percent at  December  31,  1996 and up from 2.34
percent  at March 31,  1996.  Managed  unsecured  receivable  balances  past-due
greater  than 31 days  were 4.09  percent  at March 31,  1997  compared  to 4.08
percent at December 31, 1996, and 3.46 percent at March 31, 1996.

PROVIDIAN DIRECT INSURANCE

Providian  Direct  Insurance pretax earnings were $22.8 million for the quarter,
up 4.7 percent from the same period in 1996.  Quarterly  results improved due to
the Property and Casualty segment income of $11 thousand,  compared to losses of
$3.4  million  in the same  period in 1996,  a result of more  favorable  claims
experience in the direct auto line in 1997.  These results were partially offset
by lower Life and Health earnings primarily due to the discontinuance of a joint
venture  arrangement and the run-off of the Medicare  supplement closed block of
business.

Premiums and fee-based  revenues were $161.7  million for the quarter,  down 5.9
percent  from the same period in 1996.  Total sales  declined by 25.4 percent in
the first quarter from the same period in 1996.  The premium and sales  declines
were a result of the  discontinuance  of the  joint  venture  arrangement  and a
decline in Property and Casualty sales.  However,  direct Health sales increased
29.0 percent and fee-based  Health sales  increased  117.7  percent,  reflecting
strong demand for a plan featuring discounts on prescription drugs,  eyewear and
other health-related items.

PROVIDIAN AGENCY GROUP

Providian  Agency Group pretax earnings were $47.6 million for the quarter ended
March 31,  1997,  up 3.0  percent  from the same  period in 1996.  The  increase
reflected  lower Life and Health  claims on both home  service  and  partnership
business and higher net investment spreads.

Total annualized premium gain rate, including fee-based products was essentially
even with 1996 at 2.2 percent, as low terminations in the quarter were partially
offset  by lower  marketing  partnership  sales,  a result  of two  discontinued
partnerships.  The  combined  Life and Health  policy  termination  rate of 12.2
percent for the three  months was down from 14.0  percent for the same period in
1996. The termination rate,  including fee-based  products,  was 12.7 percent at
March 31, 1997, down from 14.6 percent for the same period in 1996.

PROVIDIAN CAPITAL MANAGEMENT

Providian Capital  Management pretax earnings were $44.4 million for the quarter
ended March 31, 1997,  up 15.0  percent from the same period in 1996.  Quarterly
earnings  increased  primarily  due to  improved  spread  margins as a result of
positive  investment  results and recognition of continued  better than expected
annuity  lapse  experience.  Profit  margins on  spread-based  deposits  for the
quarter ended March 31, 1997 were 124 basis points,  which improved from the 109
basis points in the same periods in 1996.

Providian Capital  Management's  Individual fee-based deposits continued growing
steadily  with  balances of $2.6 billion at March 31, 1997,  an increase of 49.1
percent  from the same  period  in 1996.  Group  fee-based  Trust  GIC  customer
balances  were $13.5 billion as of March 31, 1997, up 10.8 percent from the same
period in 1996. Group spread-based deposits increased 8.5 percent from March 31,
1996 due to increased sales of floating rate contracts.  Individual spread-based
deposits  decreased  4.2 percent  from March 31, 1996  balances as sales  remain
challenging  due to the large amount of funds flowing into the equity market and
a very competitive pricing environment.

ANALYSIS OF FINANCIAL CONDITION

Significant  variations  between  March 31, 1997 and  December  31, 1996 balance
sheet items are discussed below.

ASSETS

Cash and  invested  assets  were $22.4  billion at March 31,  1997,  down $491.1
million, or 2.1 percent, from December 31, 1996. The decrease in invested assets
is  primarily  due to the  securitization  of  consumer  loans  during the first
quarter of 1997 of $1.4 billion.  (For  additional  information on the Company's
invested assets see the section titled "Asset/Liability Review").

LIABILITIES

Banking  deposits  decreased $397.6 million,  or 11.7 percent,  from year end as
Providian   Bancorp's  funding   requirements   declined  as  a  result  of  the
securitization of consumer loan balances and additional funding generated by the
Capital  Securities.  Deferred federal income tax decreased by $76.4 million, or
18.5  percent,  from  year end  primarily  due to the  $78.2  million  change in
deferred  taxes  associated  with the market value  decline on the available for
sale bond and stock portfolio.

PREFERRED STOCK

Preferred  stock  of  subsidiary  increased  $160.0  million  due  to  Providian
Bancorp's issuance of capital securities (see Note G).

SHAREHOLDERS' EQUITY

The net unrealized  investment gain component of shareholders'  equity decreased
$145.4 million from December 31, 1996, reflecting the decrease in the fair value
of the Company's  available for sale  investment  portfolio.  The adjustments to
record the effect of the unrealized  investment gain on shareholders' equity and
the related balance sheet accounts were as follows:


<PAGE>


                                       March 31,  December 31,
                                         1997         1996      Change
                                     ----------- ------------- ---------
                                             (Dollars in millions)

Unrealized investment gain
  on available for sale securities      $  51.9      $ 296.3     $(244.4)
Adjusted by:
  Increase (decrease) in deferred

    policy acquisition costs                3.9       (16.9)        20.8
  Increase in deferred

    federal income taxes                  (19.5)      (97.7)        78.2
                                     ----------- --------------  ---------
Net unrealized investment gain

  on available for sale securities      $  36.3      $ 181.7     $(145.4)
                                    ============ ==============  =========

ASSET/LIABILITY REVIEW

Excluding  Providian  Bancorp,  invested assets related to insurance  operations
were  $18.5  billion,  compared  to $18.8  billion at  December  31,  1996.  The
distribution of invested assets at March 31, 1997, has not changed significantly
from December 31, 1996.

Exposure to below  investment  grade bonds at March 31,  1997,  was 4.8 percent,
unchanged from December 31, 1996.  Default and loss experience in the securities
portfolio was excellent  with no  significant  losses as a result of impairments
this year. As of March 31, 1997, there was a minimal amount of securities in the
bond or  preferred  stock  portfolios  that were  delinquent  as to  interest or
dividends.

Problem  commercial  mortgage  loans  (based  on the  American  Council  of Life
Insurance  definition,  which includes loans past due 60 days or more,  loans in
the process of foreclosure,  restructured loans and real estate acquired through
foreclosure) as of March 31, 1997,  amounted to 3.9 percent of total  commercial
loans,  up from 2.9 percent at  December  31,  1996.  The  industry  average for
problem  commercial  mortgage  loans was 13.4  percent at December 31, 1996 (the
most recently published statistic). Problem residential mortgage loans (based on
Mortgage Bankers  Association (MBA) standards,  which are based on the number of
loans  that  are  past  due 30  days  or  more,  and  loans  in the  process  of
foreclosure)  were 3.9  percent at March 31,  1997  compared  to 4.0  percent at
December 31, 1996.  The MBA average for problem  residential  mortgage loans was
5.7 percent at December 31, 1996 (the most recently published statistic).  Loans
on which the Company has  discontinued  the accrual of interest and restructured
loans  accruing  interest  as of March 31,  1997 and  December  31, 1996 were as
follows:


<PAGE>


                      Commercial Loans               Residential Loans

                   ------------------------  ------------------------
                   March 31,   December 31,  March 31,   December 31,
                      1997         1996        1997          1996
                   ----------  ------------  ----------  ------------
                                     (Dollars in millions)

Non-accrual loans     $25.5        $27.1       $31.8         $32.2
Restructured loans,
  accruing interest    18.9         19.1           -            -
                   ==========  ===========  ============  ============
                      $44.4        $46.2       $31.8         $32.2
                   ==========  ===========  ============  ============

As of March 31,  1997,  there were  approximately  $36.3  million of  commercial
mortgage loans with identified  potential problems which could cause these loans
to be included in a problem  category in the future;  however,  the Company does
not anticipate any material additional losses to arise from these loans.

LIQUIDITY AND CAPITAL RESOURCES

Providian  Corporation  is a  legal  entity,  separate  and  distinct  from  its
subsidiaries and has no business operations. The primary sources of cash to meet
its  obligations,  including  principal  and interest  payments  with respect to
indebtedness,  are dividends and other statutorily  permitted  payments from its
subsidiaries.  Management  believes  that overall  sources of cash and liquidity
available  to  the  Company  will  continue  to be  sufficient  to  satisfy  its
foreseeable financial obligations.

Net consolidated cash flows from operations were $273.0 million during the three
months  ended  March 31,  1997 and $369.1  million  for the same period of 1996.
These substantial  levels come from a base of cash flows from insurance premiums
(particularly from the home service Providian Agency Group operations, which are
very  predictable  and  relatively  immune to  disintermediation),  from banking
operations  and  from  other  product  sales.  See  the  accompanying  condensed
consolidated  statements  of cash  flows for  additional  information  regarding
liquidity and funding.

Investment  commitments are planned to coincide with expected cash flows. Normal
day to day cash variations are met by a commercial  paper program,  supplemented
by committed lines of credit. Commercial paper borrowings averaged $49.6 million
during the three months at a weighted  average  interest  rate of 5.42  percent.
Commercial paper outstanding at March 31, 1997 was $49.6 million.

Excluding Providian Bancorp, the Company has committed lines of credit of $750.0
million which would  provide  additional  liquidity  should  adverse  conditions
materialize, and serve as back-up to the commercial paper program. There were no
borrowings  under these lines of credit  during 1996 and no amounts  outstanding
under them as of March 31,  1997.  In  addition,  the  Company's  bond and stock
portfolio of $11.4 billion at March 31, 1997  provides a  significant  source of
short-term liquidity.

Providian Bancorp analyzes its current and future liquidity needs to support its
deposit  portfolio and asset growth and has a revolving line of credit agreement
which  provides  liquidity for the existing  deposit base, as well as satisfying
short-term funding requirements. The amount available under the credit agreement
is $1.2 billion.  Outstanding borrowings under the agreement were $110.0 million
at March 31, 1997.

On  February  4,  1997,   Providian  Bancorp  completed  a  capital   securities
transaction  pursuant to which a subsidiary  trust of Providian  Bancorp  issued
$160.0  million  in  liquidation  amount  of  mandatorily  redeemable  preferred
securities  (the  "Capital  Securities").  The  subsidiary  trust  invested  the
proceeds in 9.525%  Junior  Subordinated  Deferrable  Interest  Debentures  (the
"Debentures")  issued by Providian Bancorp. In addition to its obligations under
the  Debentures,  Providian  Bancorp  has  guaranteed  payments  on the  Capital
Securities  to the  extent  of funds  held by the  subsidiary  trust.  Providian
Bancorp used the proceeds  from this  transaction  for the  retirement  of $42.5
million of  long-term  debt and the  redemption  of $63.3  million of  preferred
stock,  both held by Providian  Corporation,  and for general  Providian Bancorp
business  purposes.  Providian  Corporation will use the proceeds to redeem,  in
whole,  on May 19, 1997,  $95.0 million in outstanding  principal  amount of the
8.75% Sinking Fund Debentures,  due January 15, 2017 at a total redemption price
of $99.2 million plus accrued interest.


<PAGE>



PART II - OTHER INFORMATION

Item 1.   Legal Proceedings

In the normal course of business,  the Company and its  subsidiaries are parties
to a number of lawsuits.  Management  believes that these suits will be resolved
with no material financial impact to the Company.

Item 2.   Change 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

Item 6. Exhibits and Reports on Form 8-K

Exhibits: Exhibit 27 - Financial Data Schedule

Reports:          A report on form 8-K was filed on February 12, 1997, reporting
                  proforma   historical   financial   information  of  Providian
                  Bancorp,  Inc.,  giving effect to the proposed spin-off of the
                  Registrant's wholly owned subsidiary,  Providian Bancorp, Inc.
                  to the  shareholders  of the  Registrant  and the  issuance of
                  $160.0 million of capital  securities by a subsidiary trust of
                  Providian Bancorp.

                  A report on Form 8-K was filed on April 22,  1997,  containing
                  Proforma Condensed Financial Information of Providian Bancorp,
                  Inc.  and   Subsidiaries,   giving   effect  to  the  proposed
                  Distribution  and  the  issuance  of  capital  securities  and
                  Consolidated  Financial Statements of Providian Bancorp,  Inc.
                  and Subsidiaries.


<PAGE>



                                   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.

                                         Providian Corporation
                            -------------------------------------------------
                                              (Registrant)

Date:  May 13, 1997                         Robert L. Walker
                             ------------------------------------------------
                               Senior Vice President -- Finance and Chief
                                            Financial Officer

Date: May 13, 1997                          Steven T. Downey
                            -------------------------------------------------
                                     Vice President and Controller



<PAGE>