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 quarterly period ended September 30, 1996
                                                          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 October 31, 1996.

                Class                                Shares Outstanding
-----------------------------------------     -------------------------------
    Common Stock, $1.00 par value                        93,705,798



<PAGE>


--------------------------------------------------------------------------------
Part I - FINANCIAL INFORMATION
Item 1. Financial Statements

<TABLE>
                     PROVIDIAN CORPORATION AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

<CAPTION>
                                                          September 30,1996          December 31,
                                                             (Unaudited)                 1995
                                                            --------------         ---------------
                                                                      (Dollars in millions)
<S>                                                             <C>                    <C>
Assets
Investments:
  Bonds and stocks, available for sale, at fair value
   (Amortized cost of $10,585 and $10,566
     in 1996 and 1995, respectively)                            $ 10,733               $ 11,158
  Trading account securities, at fair value                           92                    105
  Commercial mortgage loans                                        2,770                  2,740
  Residential mortgage loans                                       2,809                  3,063
  Consumer loans, net                                              2,845                  2,968
  Consumer loans held for securitization                             520                    123
  Policy loans                                                       483                    454
  Other investments                                                  599                    605
                                                                --------               --------
                         Total Investments                        20,851                 21,216

Cash and cash equivalents                                            791                    708
Deferred policy and loan acquisition costs                         1,527                  1,481
Value of insurance in force purchased                                242                    256
Goodwill                                                             204                    214
Separate account assets                                            2,798                  2,070
Other assets                                                         917                    894
                                                                --------               --------
                                                                ========               ========
                              Total Assets                      $ 27,330               $ 26,839
                                                                ========               ========

Liabilities and Shareholders' Equity
Liabilities:
  Benefit reserves and other policy liabilities                 $  9,664               $  9,894
  Policyholder contract deposits                                   6,637                  6,858
  Banking deposits                                                 2,620                  2,158
  Separate account liabilities                                     2,798                  2,070
  Long-term debt issued by:
    Corporate                                                        738                    721
    Bancorp                                                           50                     --
  Deferred federal income tax                                        351                    505
  Other liabilities                                                1,477                  1,572
                                                                --------               --------
                         Total Liabilities                        24,335                 23,778

Commitments and Contingencies

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

Shareholders' Equity:
  Common stock, $1 par                                               115                    115
  Additional paid-in capital                                          46                     50
  Net unrealized investment gain                                      94                    359
  Retained earnings                                                3,009                  2,770
  Common stock held in treasury - at cost:
    1996 - 21,713,000 shares;
    1995 - 20,967,000 shares                                        (364)                  (330)
  Unearned restricted stock                                           (5)                    (3)
                                                                --------               --------
                Total Shareholders' Equity                         2,895                  2,961
                                                                --------               --------
                                                                ========               ========
   Total Liabilities and Shareholders' Equity                   $ 27,330               $ 26,839
                                                                ========               ========
<FN>

See notes to condensed consolidated financial statements 
</FN>
</TABLE>
<PAGE>
Item 1. -- (Continued)

<TABLE>
                     PROVIDIAN CORPORATION AND SUBSIDIARIES
             CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
<CAPTION>

                                                                                      Nine Months                  Three Months    
                                                                               --------------------------   ------------------------
Period Ended September 30                                                        1996             1995        1996             1995 
                                                                               ---------        ---------   ---------        -------
                                                                                     (Amounts in millions, except per common share)
                                                                               
<S>                                                                            <C>            <C>              <C>          <C>    
Revenues:
  Premiums and other considerations                                            $   899        $   903          $   293      $   297
  Investment income, net of expenses                                             1,420          1,395              484          463
  Consumer loan servicing fees                                                     195            176               74           77
  Realized investment loss                                                          (9)           (70)              (8)         (19)
  Other income, net                                                                150            107               49           39
                                                                               -------        -------          -------      -------
                                              Total Revenues                     2,655          2,511              892          857

Benefits and Expenses:
  Benefits and claims                                                              691            657              218          206
  Increase in benefit and contract reserves                                        593            674              203          234
  Commissions, net                                                                  67             61               22           21
  General, administrative and other expenses, net                                  552            495              198          175
  Amortization of deferred policy and loan acquistion costs,
     value of insurance in force purchased and goodwill                            220            187               71           64
  Interest expense                                                                  89             82               30           27
                                                                               -------        -------          -------      -------
                                 Total Benefits and Expenses                     2,212          2,156              742          727
                                                                               -------        -------          -------      -------

                            Income before Federal Income Tax                       443            355              150          130

Federal Income Tax                                                                 130            108               42           40
                                                                               -------        -------          -------      -------

Net Income before Dividends on Company-Obligated Mandatorily
  Redeemable Preferred Securities of Providian LLC                                 313            247              108           90

Dividends on Company-Obligated Mandatorily Redeemable
  Preferred Securities of Providian LLC                                              4              4                2            1
                                                                               -------        -------          -------      -------

                                                  Net Income                   $   309        $   243          $   106      $    89
                                                                               =======        =======          =======      =======

                                 Net Income per Common Share                   $  3.29        $  2.52          $  1.13      $   .93
                                                                               =======        =======          =======      =======

Cash Dividends per Common Share                                                $   .75        $  .675          $   .25      $  .225
                                                                               =======        =======          =======      =======

Weighted Average Number of Common Shares
  Outstanding During the Period                                                   93.7           96.2             93.6         95.3
                                                                               =======        =======          =======      =======
<FN>

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

<PAGE>


Item 1. -- (Continued)
<TABLE>
                                   PROVIDIAN CORPORATION AND SUBSIDIARIES
                         CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
<CAPTION>

Nine Months Ended September 30                                                   1996          1995
                                                                             -------------  -----------
                                                                                (Dollars in millions)

<S>                                                                            <C>            <C>    
Net Cash Flows provided by Operations                                          $ 1,026        $ 1,069

Cash Flows from Investment Activities:
  Investments sold or matured                                                    5,406          4,204
  Cost of securities and mortgage loans acquired                                (5,064)        (4,095)
  Additions to operating property                                                  (44)           (23)
  Net increase in consumer loans                                                (2,314)        (1,758)
  Proceeds from securitization of loans                                          1,990          1,549
  Purchase of securitized consumer loans                                           (39)          (241)
  All other investment activities                                                 (103)           226
                                                                               -------        -------

                                 Net Cash Flows used in Investment Activities     (168)          (138)

Cash Flows from Financing Activities:
  Net increase (decrease) in short-term borrowings                                (466)           130
  Policyholder contract deposits                                                 1,215          1,570
  Withdrawals of policyholder contract deposits                                 (2,263)        (2,452)
  Net increase in banking deposits                                                 462             34
  Issuance of long-term debt by:
     Corporate                                                                      63             84
     Bancorp                                                                        50              -
  Repayment of long-term debt                                                      (46)           (79)
  Net borrowings on Providian Bancorp
     revolving line of credit                                                      326            203
  Purchase of common stock for treasury                                            (55)           (94)
  Dividends on common stock                                                        (70)           (65)
  Proceeds from exercise of stock options                                            9             10
                                                                               -------        -------

                                  Net Cash Flows used in Financing Activities     (775)          (659)
                                                                               -------        -------

                                    Net Increase in Cash and Cash Equivalents       83            272

                             Cash and Cash Equivalents at Beginning of Period      708            573
                                                                               -------        -------

                                   Cash and Cash Equivalents at End of Period  $   791        $   845
                                                                               =======        =======
<FN>

See notes to condensed consolidated financial statements.
</FN>
</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.  Certain 1995 amounts have
     been  reclassified  to  conform to the  current  year  presentation.  These
     reclassifications  did  not  have a  significant  effect  on the  Company's
     financial  position,  results of operations  or cash flows.  The results of
     operations  for the  nine-month  period  ended  September  30, 1996 are not
     necessarily  indicative  of the  results to be  expected  for the full year
     ending December 31, 1996. These unaudited condensed  consolidated financial
     statements  should be read in conjunction with the  consolidated  financial
     statements  and footnotes  included in the Company's  annual report on Form
     10-K for the year ended December 31, 1995.

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

 C.  Consumer  loans  have  been  reduced  by the  sale,  without  recourse,  of
     unsecured  receivables  under  asset  securitization  plans  during 1996 of
     $1,990.0  million.  At  September  30, 1996,  there were $520.0  million of
     consumer loans in process of  securitization.  Total  consumer  receivables
     outstanding under  securitization  plans were $5.1 billion at September 30,
     1996.

 D.  An analysis of the allowance for loan losses on consumer and mortgage loans
     for the nine-month periods ended September 30, 1996 and 1995 is as follows:

                                                   Consumer             Mortgage
<TABLE>
<CAPTION>
                                             -------------------   ------------------
Nine Months Ended September 30                   1996      1995      1996       1995
                                             ---------  --------   -------   --------
                                                       (Dollars in millions)
<S>                                               <C>       <C>       <C>        <C>
Balance at beginning of period               $    93    $    76    $    50  $    52
Current period provision                          90         42          6       13
Current period chargeoffs,
    net of recoveries                            (76)       (46)        (5)     (18)
                                             =======    =======    =======  =======
Balance at end of period                     $   107    $    72    $    51  $    47
                                             =======    =======    =======  =======
</TABLE>


<PAGE>


E.       During the nine months ended September 30, 1996,  Providian Bancorp had
         net  borrowings  of $326.0  million from its  revolving  line of credit
         agreement.  Outstanding  borrowings  under the  agreement  were  $647.0
         million at September 30, 1996.

         The amount available under Providian Bancorp's revolving line of credit
         was increased from $800.0 million to $1.2 billion during May 1996.

F.       During the nine months ended  September  30, 1996,  the Company  issued
         $63.0 million of Series D medium-term notes with maturities of 10 to 30
         years and interest rates ranging from 6.31 percent to 7.44 percent.  In
         addition, long-term debt totaling $45.8 million matured during the nine
         months ended September 30, 1996.

         Providian  Bancorp  issued  $50.0  million of notes with a maturity  of
         three years and an interest rate of 5.74 percent during the nine months
         ended September 30, 1996.

 G.  During the nine months ended  September 30, 1996,  the Company  repurchased
     1,255,980  shares of its  common  stock at an  average  price of $43.56 per
     share.

 H.  In June 1996, the Financial  Accounting Standards Board issued Statement of
     Financial  Accounting  Standards  No. 125,  "Accounting  for  Transfers and
     Servicing of Financial Assets and Extinguishments of Liabilities" (SFAS No.
     125),  which is effective for  transfers and servicing of financial  assets
     and  extinguishments of liabilities  occurring after December 31, 1996, and
     is to be applied prospectively. The provisions of SFAS No. 125 which relate
     to  accounting  for  transfers  and  servicing  of  financial   assets  are
     applicable to the Company's loan securitization activities.  Management has
     not yet  determined  the impact that the adoption of SFAS No. 125 will have
     on the Company's consolidated financial statements.


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

This item  presents  specific  comments  on  material  changes to the  Company's
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, 1995, and
the Company's  quarterly  reports on Form 10-Q for the quarters  ended March 31,
1996 and June 30, 1996.

Results of Operations

The following  discussion compares the results of operations for the nine months
ended  September  30, 1996,  to the nine months ended  September  30, 1995.  The
nature of and reasons for any significant  variation  between the quarters ended
September  30, 1996,  and September  30, 1995,  are the same as those  discussed
below for the  respective  nine month  periods,  except  where  otherwise  noted
herein.

Consolidated Results

Providian's  net income for the quarter ended  September 30, 1996, was $1.13 per
common and common equivalent share (hereinafter  called "per common share"),  up
21.5  percent  from the $0.93 per common  share  reported for the same period in
1995.  Net income for the nine months ended  September  30, 1996,  was $3.29 per
common share,  up 30.6 percent from the $2.52 per common share  reported for the
same  period in 1995.  Net income for the  quarter  ended  September  30,  1996,
included pretax realized losses of $8.3 million, comprised of realized losses on
investments  and  securities of $5.7 million and $2.6 million in provisions  for
mortgage loan losses.  Net income for the nine months ended  September 30, 1996,
included pretax  realized  losses of $8.9 million,  comprised of $3.2 million of
realized losses on investments and securities and $5.7 million in provisions for
mortgage  loan  losses.  Pretax  realized  losses  were $19.3  million and $69.6
million for the quarter and nine months,  respectively,  in 1995. The losses for
the nine months ended  September 30, 1995,  included  losses of $56.1 million on
futures  transactions  used as an economic  hedge of the available for sale debt
securities portfolio during that period.

Earnings, as discussed herein,  exclude realized investment gains and losses and
related deferred acquisition cost amortization,  net of taxes.  Earnings for the
quarter ended  September 30, 1996,  were $1.19 per common share, up 13.3 percent
from the $1.05 per common  share  reported in the same period in 1995.  Earnings
for the nine months ended  September 30, 1996,  were $3.36 per common share,  up
11.6  percent  from the $3.01 per common  share  reported  in the same period in
1995. 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 September 30, 1996,  were $900.3 million,  up 2.7
percent from the $876.6  million  reported in the same period in 1995.  Revenues
for the nine months were $2.7  billion,  up 3.2  percent  from the $2.6  billion
reported in the same period in 1995.  The increases  were  primarily a result of
higher  revenues  from  significant  growth in total  managed loans at Providian
Bancorp,  partially  offset  by lower  investment  income at  Providian  Capital
Management, primarily due to lower spread-based policyholder balances. Providian
Bancorp's  revenues,  primarily  investment  income and consumer loan  servicing
fees,  increased  $52.5  million for the quarter,  or 26.2  percent,  and $131.8
million for the nine  months,  or 22.9  percent,  from the same periods in 1995.
Providian Capital Management's revenues,  primarily investment income, decreased
$22.5  million for the quarter,  or 8.0 percent,  and $37.3 million for the nine
months, or 4.5 percent, from the same periods in 1995.

Total  benefits  and  expenses  increased  $15.1  million for the quarter  ended
September 30, 1996, or 2.1 percent,  and $56.0 million for the nine months ended
September 30, 1996, or 2.6 percent,  from the same periods in 1995. Benefits and
reserves  decreased  $18.8  million for the quarter,  or 4.3 percent,  and $47.2
million for the nine months, or 3.5 percent,  from the same periods in 1995. The
decreases are primarily due to Providian  Capital  Management's  lower  credited
rates on reduced policyholder balances,  partially offset by Providian Bancorp's
growth in average deposits on hand.  General,  administrative and other expenses
were up $23.4 million for the quarter,  or 13.4  percent,  and $57.6 million for
the nine months,  or 11.7 percent,  from the same periods in 1995. The increases
primarily  reflect an increase  in the  provision  for loan losses by  Providian
Bancorp to address  significant  on-balance  sheet loan growth and higher credit
loss rates, as well as increased marketing activity. Amortization increased $6.5
million for the quarter, or 10.2 percent, and $32.9 million for the nine months,
or 17.6 percent,  from the same periods in 1995. The increases are primarily due
to the normal amortization of increased deferred  acquisition costs at Providian
Bancorp as well as the  accelerated  amortization  of a portion of such costs in
connection  with the  securitization  of a portion of Providian  Bancorp's  home
equity loan portfolio.

Business Segment Results

Providian Bancorp
Providian Bancorp continued its strong performance with pretax earnings of $56.1
million for the quarter and $162.8  million for the nine months ended  September
30, 1996, up 17.0 percent and 19.5 percent, respectively,  from the same periods
in 1995. These results reflect strong growth in unsecured and home equity loans,
partially offset by lower net interest margins and higher net credit losses.

Total managed  loans,  including  $5.1 billion of  securitized  receivables  and
$520.0  million  of  receivables  in the  process of  securitization,  were $8.6
billion as of September  30, 1996,  up 39.5  percent  over  September  30, 1995,
balances.  Managed  unsecured  receivables  grew $2.0 billion from September 30,
1995,  as a result of the  continued  success  of the  Primary  Lender  program.
Additionally,  the managed home equity loan portfolio,  including $415.0 million
of  securitized  receivables,  was $874.5  million as of September  30, 1996, up
$232.7 million from September 30, 1995.

The net interest margin on managed  unsecured  receivables for the quarter ended
September  30, 1996,  decreased to 10.97  percent from the 12.21 percent for the
same period in 1995. The net interest  margin on managed  unsecured  receivables
for the nine months ended September 30, 1996, was 11.09 percent, down from 12.57
percent  for  the  same  period  in  1995.  The  decreases   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 4.15  percent at  September  30,  1996,  compared  to 3.97
percent at December 31, 1995,  and 3.89 percent at September  30, 1995.  The net
credit loss rate for managed unsecured  receivables for the quarter increased to
5.53 percent from 4.38 percent for the same period in 1995.  The net credit loss
rate for managed unsecured  receivables for the nine months was 5.37 percent, up
from 4.39 percent for the same period in 1995. Balances past-due greater than 31
days related to  on-balance  sheet  unsecured  receivables  were 2.29 percent at
September  30, 1996,  compared to 2.41  percent at December  31, 1995,  and 2.49
percent at September 30, 1995.  Managed unsecured  receivable  balances past-due
greater than 31 days were 3.71 percent at September  30, 1996,  compared to 3.22
percent at December 31, 1995,  and 2.94  percent at  September  30, 1995.  These
increases  in net  credit  losses and  past-due  balances  on managed  unsecured
receivables are consistent with industry trends and Providian's expectations.

Providian Direct Insurance
Providian  Direct  Insurance  pretax earnings were $23.1 million for the quarter
and $67.3  million for the nine  months  ended  September  30,  1996,  down 21.3
percent  and 22.1  percent,  respectively,  from the same  periods in 1995.  The
quarterly  results  included losses in the Property and Casualty segment of $0.7
million,  compared  to  income  of $2.6  million  in the  same  period  in 1995,
primarily  due  to  declining  premiums  and  higher  amortization  of  deferred
acquisition  costs.  The nine-month  results included losses in the Property and
Casualty  segment of $5.1  million,  compared to income of $7.3 million in 1995,
primarily  attributable to unfavorable  claims experience and increased reserves
in the auto line due in part to severe  winter  storms  during late 1995 and the
first quarter of 1996. Additionally,  Health earnings were down $2.5 million for
the quarter and $7.7 million for the nine months, primarily from the anticipated
run-off of the Medicare Supplement in force block of business.

Premiums and fee-based  revenues were $166.4  million for the quarter and $506.4
million for the nine months ended  September 30, 1996,  down 3.0 percent and 2.0
percent,  respectively,  from the same periods in 1995. The premium  decline was
primarily due to the repositioning of the military auto business,  the strategic
withdrawal  from the  homeowners  business  and the  anticipated  run-off of the
Medicare Supplement in force block of business. Sales declined $15.7 million, or
44.9 percent,  for the third quarter and $28.4 million, or 28.9 percent, for the
nine months,  reflecting  the  discontinuance  of a Life and Health  partnership
arrangement,  a decline  in direct  Health  sales and the  repositioning  of the
military auto business.


<PAGE>



Providian Agency Group
Providian  Agency Group pretax earnings were $48.4 million for the quarter ended
September  30,  1996,  up 5.7 percent  from the same period in 1995,  and $141.6
million for the nine months ended  September  30, 1996,  up 4.1 percent from the
same period in 1995.  The increases  reflect the  continuing  effects of expense
management  initiatives  and favorable  Health claims  experience.  For the nine
month  comparison,  these  favorable  results  were  partially  offset by higher
mortality experience in the first half of 1996.

Total premiums and fee-based revenues were essentially even with 1995.  However,
total sales  declined  18.1 percent for the quarter and 7.2 percent for the nine
months ended  September  30, 1996,  primarily  due to the higher volume of sales
during 1995 associated with the initial roll-out of the First Health AdvantageSM
fee-based product and lower 1996 Marketing Partnership sales associated with two
discontinued partnerships.  The combined Life and Health policy termination rate
of 14.3  percent for the nine months was up from the 14.2  percent  rate for the
same period in 1995.  Including fee-based products in 1996, the termination rate
was 14.8 percent,  up from 14.3 percent for the nine months ended  September 30,
1995, due to fee-based product terminations.

Providian Capital Management
Providian Capital  Management pretax earnings were $39.5 million for the quarter
ended  September  30, 1996,  up 12.2  percent from the same period in 1995,  and
$118.0  million for the nine months ended  September  30, 1996,  up 21.5 percent
from the same period in 1995. The quarterly  earnings  increase is primarily due
to the impact of lower credited rates,  lower expenses and reduced  amortization
of  acquisition  costs,   partially  offset  by  lower  investment  yields.  The
nine-month  earnings increase is primarily  attributable to lower credited rates
and growth in fee-based  earnings,  partially offset by lower investment  yields
and  spread-based  deposits.  Profit  margins on  spread-based  deposits for the
quarter and nine months ended  September 30, 1996, were 113 basis points and 112
basis points, respectively,  which were significantly improved from the 93 basis
points and 88 basis points, respectively, in the same periods in 1995.

Providian Capital  Management's  Individual fee-based deposits continued growing
steadily  with  balances of $2.1 billion at September  30, 1996,  an increase of
50.7  percent  over  September  30, 1995  balances.  Group  fee-based  Trust GIC
customer  balances have grown to $13.1 billion as of September 30, 1996, up 18.6
percent over last year.  Individual and Group spread-based deposits declined 6.3
percent and 8.1 percent,  respectively,  from September 30, 1995. Although sales
of  Group  products  improved  in the  quarter,  individual  spread-based  sales
remained  challenging  due to the large amount of funds  flowing into the equity
market and a very competitive pricing environment.


<PAGE>




Analysis of Financial Condition

Significant  variations  between  September  30,  1996,  and  December 31, 1995,
balance sheet items are discussed below.

Assets

Cash and invested  assets were $21.6 billion at September 30, 1996,  down $282.2
million, or 1.3 percent, from December 31, 1995. The decrease in invested assets
is due to the decline in market value of the  Company's  available for sale bond
and stock portfolio,  reflecting increases in market interest rates during 1996.
Residential mortgage loans decreased $254.0 million, or 8.3 percent, as a result
of the sale of $125.0  million of loans,  and from payoffs  exceeding  purchases
during 1996. Consumer loans, including those held for securitization,  increased
$274.0 million,  or 8.9 percent,  primarily due to the continued  success of the
Primary Lender program. Separate account assets and liabilities increased $727.6
million,  or 35.1  percent,  primarily  due to variable  annuity sales of $430.2
million and related fund growth of $155.5 million.  (For additional  information
on the  Company's  invested  assets  see  the  section  titled  "Asset/Liability
Review").

Liabilities

Banking deposits increased $462.2 million, or 21.4 percent, as Providian Bancorp
utilized them to fund  receivable  growth.  Providian  Bancorp also issued $50.0
million  of  three-year  notes  (see  Note  F  to  the  accompanying   condensed
consolidated  financial statements and the section titled "Liquidity and Capital
Resources").  Deferred  federal income tax decreased by $153.9 million,  or 30.5
percent,  from year end due primarily to the $142.7  million  change in deferred
taxes  associated  with the market value  decline on the available for sale bond
and stock portfolio.

Shareholders' Equity

The net unrealized  investment gain component of shareholders'  equity decreased
$265.1 million from December 31, 1995, 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>

<TABLE>
<CAPTION>


                                                   September 30,       December 31,
                                                       1996                1995               Change
                                                  ----------------    ----------------    ---------------
                                                                  (Dollars in millions)
Unrealized investment gain
<S>                                                      <C>                 <C>                <C>     
Unrealized investment gain
  on available for sale securities                       $ 148.5             $ 592.6            $(444.1)
Adjusted by:
  Decrease in deferred
    policy acquisition costs                                (3.8)              (40.1)              36.3
  Increase in deferred
    federal income taxes                                   (50.6)             (193.3)             142.7
                                                  ----------------    ----------------    ---------------
Net unrealized investment gain
  on available for sale securities                       $  94.1             $ 359.2            $(265.1)
                                                  ================    ================    ===============
</TABLE>

Asset/Liability Review

Excluding  Providian  Bancorp,  invested assets related to insurance  operations
were  $17.8  billion,  compared  to $18.5  billion at  December  31,  1995.  The
distribution  of  invested  assets  at  September  30,  1996,  has  not  changed
significantly from December 31, 1995.

Exposure to below investment grade bonds at September 30, 1996, was 5.0 percent,
up slightly from 4.9 percent at December 31, 1995.  Default and loss  experience
in the securities portfolio was excellent with no significant losses as a result
of impairments  this year. As of September 30, 1996,  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  September  30,  1996,  amounted  to 3.15  percent  of total
commercial  loans,  up from 2.96  percent at December  31,  1995.  The  industry
average for problem commercial mortgage loans was 15.25 percent at June 30, 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 3.56 percent at September 30, 1996,  compared to 3.30 percent
at December 31, 1995. The MBA average for problem residential mortgage loans was
5.22 percent at June 30, 1996 (the most recently published statistic).  Loans on
which the Company has  discontinued  the  accrual of interest  and  restructured
loans accruing interest as of September 30, 1996, and December 31, 1995, were as
follows:


<PAGE>

<TABLE>
<CAPTION>


                                        Commercial Loans                      Residential Loans
                               -----------------------------------   -------------------------------------
                                September 30,      December 31,       September 30,       December 31,
                                     1996              1995               1996                1995
                               -----------------  ----------------   ----------------  -------------------
                                                          (Dollars in millions)
<S>                                  <C>              <C>                <C>                  <C>  
Non-accrual loans                    $33.8            $28.5              $30.3                $31.8
Restructured loans,
  accruing interest                   20.7             14.5                  -                    -
                               =================  ================   ================  ===================
                                     $54.5            $43.0              $30.3                $31.8
                               =================  ================   ================  ===================
</TABLE>

As of September 30, 1996, there were  approximately  $95.3 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 Providian  Corporation  and its  subsidiaries  ("the Company") will
continue to be sufficient to satisfy its foreseeable financial obligations.

Net  consolidated  cash flows from  operations were $1.0 billion during the nine
months ended  September 30, 1996,  and $1.1 billion for the same period of 1995.
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  $111.3
million  during the nine  months at a  weighted  average  interest  rate of 5.43
percent. Commercial paper outstanding at September 30, 1996, was $49.7 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 September 30, 1996. In addition,  the Company's  bond and stock
portfolio of $10.8 billion at September 30, 1996,  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. During May 1996, the amount available under the
credit agreement was increased from $800.0 million to $1.2 billion.  Outstanding
borrowings under the agreement were $647.0 million at September 30, 1996.

Excluding  Providian  Bancorp,  the Company issued $63.0 million of its Series D
medium-term  notes during the nine months ended  September  30, 1996,  and $45.8
million of the Company's long-term debt matured during that period. In addition,
Providian  Bancorp  issued  $50.0  million of  three-year  notes during the nine
months ended September 30, 1996.

During  September  1996,  the Company  registered  $389.0  million of additional
medium-term  notes,  bringing  the  total  amount of such  securities  which are
available for issuance to $500.0 million.

During the first nine months of 1996, the Company  repurchased  1,255,980 shares
of its common stock at an average  price of $43.56 per share to complete the 2.5
million share repurchase  program announced during the third quarter of 1995. On
October 1, 1996, the Company  announced  plans to repurchase  approximately  2.0
million  additional  shares. The specific amount and timing of share repurchases
will depend on market conditions and other factors.

In May 1996,  Standard & Poor's  Ratings  Group  ("Standard & Poor's")  upgraded
Providian Life and Health Insurance  Company's  claims-paying  ability rating to
AA+ from AA.  Standard & Poor's also changed the  claims-paying  ability ratings
for Commonwealth  Insurance and Peoples  Security  Insurance to AA+ from AAA and
the Company's senior debt rating to AA- from AA. Standard & Poor's also affirmed
its  AA-  rating  of the  Company  Obligated  Mandatorily  Redeemable  Preferred
Securities  of Providian  LLC and the  commercial  paper  ratings of A-1+ of the
Company and these three subsidiaries.

In June 1996, two Providian  Bancorp  subsidiaries,  First Deposit National Bank
and  Providian  National  Bank,  received  first time ratings on unsecured  debt
obligations  from Duff & Phelps and Standard & Poor's.  The banks were  assigned
senior long-term  obligation  ratings of A+ by Duff & Phelps and A by Standard &
Poor's. Short-term obligations were assigned ratings of D-1 by Duff & Phelps and
A-1 by Standard & Poor's. In July 1996,  Moody's assigned a first time A2 rating
for long-term  deposits,  as well as ratings of P-1 for short-term  deposits and
other senior  obligations.  These ratings  reflect  Providian  Bancorp's  strong
operating  results  and  strategic  position  in the  marketplace,  as  well  as
Providian's ownership.



<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

Not applicable

Item 6.   Exhibits and Reports on Form 8-K

Exhibits: Exhibit 27 - Financial Data Schedule

Reports:  None



<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:  November 13, 1996
                                      ------------------------------------------
                                                     Robert L. Walker
                                     Senior Vice President -- Finance and Chief
                                                     Financial Officer

Date:  November 13, 1996
                                     -------------------------------------------
                                                     Steven T. Downey
                                              Vice President and Controller



<PAGE>


PROVIDIAN CORPORATION AND SUBSIDIARIES

LIST AND INDEX OF EXHIBITS

Reference Number Per                                  Exhibit Number
    Exhibit Table      Description of Exhibit               Page
---------------------  -------------------------     ------------------    

        (27)           Financial Data Schedule              27