FORM 10-K --- ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF   
                     THE SECURITIES EXCHANGE ACT OF 1934
                                UNITED STATES
                     SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC  20549
                                  FORM 10-K

(Mark One)
[ X ] Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange 
      Act of 1934
[Fee Required]
For the fiscal year ended                 December 31, 1998	
                           -----------------------------------------------------
                                                  or
[   ] Transition Report Pursuant to Section 13 or 15(d) of the Securities 
      Exchange Act of 1934
[No Fee Required]
For the transition period from                      	 to                        
                               ----------------------    -----------------------
Commission File Number                           0-14745	         
                       ---------------------------------------------------------
           				                          SUN BANCORP, INC. (SUN)		
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                         (Exact name of registrant as specified in its charter)

	  Pennsylvania		 			                                            23-2233584	
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(State or other jurisdiction of				                            (I.R.S. Employer
incorporation or organization)				                           Identification No.)

PO Box 57, Selinsgrove, PA						                                   17870	
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(Address of principal executive offices)			                      (Zip Code)

Registrant's telephone number, including area code 	        570-374-1131			
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Securities registered pursuant to Section 12(b) of the Act:
                        								                        Name of each exchange on
   	Title of each class                                     which registered	
	 	       None					                                          		   None		
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Securities registered pursuant to Section 12(g) of the Act:

             			         	     Common stock, No Par Value				
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              				                 (Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was 
required to file such reports), and (2) has been subject to such filing 
requirements for the past 90 days. [ X ] Yes  [    ] No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 
of Regulation S-K (Section 229.405 of this Chapter) is not contained herein, and
will not be contained, to the best of registrant's knowledge, in definitive 
proxy or information statements incorporated by reference in PART III of this 
Form 10-K or any amendment to this Form 10-K.  [  ]  

As of March 4, 1999, the Registrant had 6,516,691 shares of common stock 
outstanding with a no par value.  Based on the closing bid price of $26.00 on 
the same date, the aggregate market value of the voting stock held by 
nonaffiliates of the Registrant was $169,433,966.

Portions of the 1998 Annual Report to Shareholders are incorporated by reference
in Parts I, II, and III hereof.

Portions of the 1999 Proxy Statement for the Annual Shareholders' Meeting to be 
held on April 22, 1999 are incorporated by reference in Part III hereof.

The index to exhibits included in this filing appears on page 5.
<PAGE>
                                     PART I
                                     ------
ITEM 1 - BUSINESS
	
  SUN BANCORP, INC. (SUN) is a holding company incorporated under the laws of 
Pennsylvania and registered under the Bank Holding Company Act of 1956, as 
amended, on November 26, 1982.  SUN acquired the Snyder County Trust Company in 
June 1983 and The Watsontown National Bank in November 1987.  On December 1, 
1993, the two banks merged into one bank under the legal title of Sun Bank 
(Bank).  The banks continue to do business as Snyder County Trust Company, 
Incorporated as Sun Bank and Watsontown Bank, Incorporated as Sun Bank.  SUN 
also owns the Pennsylvania SUN Life Insurance Company, a credit life and 
disability insurance company formed in 1993.  SUN is a limited partner in two 
partnerships for the purpose of building, owning, and operating an affordable 
elderly apartment complex in SUN's market area.  As part of the agreement, SUN 
is able to recognize tax credits from this economic development project.  On 
June 30, 1997, SUN acquired Bucktail Bank and Trust Company (Bucktail) from FNB 
Corporation.  Concurrently, Bucktail was merged into Sun Bank.  Five branches of
Bucktail located in Lycoming County were renamed and doing business under the 
name Central Pennsylvania Bank, Incorporated as Sun Bank.  The remaining 
branches in Elk and Cameron Counties continue under the name Bucktail Bank and 
Trust Company, Incorporated as Sun Bank.  
		
 	Sun Bank, a state-chartered bank regulated by Pennsylvania Banking Law, 
provides full service commercial and retail banking services primarily in 
central Pennsylvania.  Sun Bank operates fourteen banking offices and one trust 
services office serving Snyder, Union, Northumberland, Lycoming, Cameron, and 
Elk Counties.  At December 31, 1998, Sun Bank had total assets of $623,577,000 
and total shareholders' equity of $67,801,000.  Net income for 1998 was 
$8,726,000.
	
 	The Bank offers a wide range of services including demand deposit accounts, 
savings accounts, Christmas and all-purpose clubs, time certificates of deposit,
and individual retirement accounts, as well as commercial loans, consumer loans,
mortgage loans, and safe deposit services.  The Bank also operates a trust 
department that provides full fiduciary services.  Also, 26 Automated Teller 
Machines (ATMs) and cash dispensing units throughout the service area provide 
24-hour banking service.  Sun Bank's activities are such that the loss of one 
single customer or a few customers would not have a material adverse effect on 
its operations.  Additionally, the Bank's business is not seasonal in nature and
does not engage in foreign transactions.  The majority of the loan portfolio is 
comprised of residential real estate loans and consumer loans (predominately 
automobiles).  The Bank's deposits are insured by the Federal Deposit Insurance 
Corporation (FDIC) in the amount allowed by law.

 	The Pennsylvania SUN Life Insurance Company (SUN Life) provides credit life 
and disability insurance to Sun Bank's credit customers.  SUN Life is subject to
supervision and regulation by the Arizona Department of Insurance, the Insurance
Department of the Commonwealth of Pennsylvania, and the Board of Governors of 
the Federal Reserve Bank.  At December 31, 1998, Pennsylvania SUN Life had total
assets of  $711,000 and total shareholders' equity of $308,000.  Net income for 
1998 was $15,000.

 	Competition continues to heighten in the financial  services industry not only
among banks but with savings and loan associations, credit unions, discount 
brokerage firms, insurance companies, and other nonbank financial service 
providers.  Changing regulatory and economic conditions affect SUN's ability to 
compete effectively in its market area.  Most of the competition is centered 
around the setting of interest rates to be charged on loans and rates paid on 
deposits, fees on deposit accounts and customer service.  SUN's management feels
it competes effectively in its market area.

<PAGE>
 	SUN is subject to regulation and supervision by the Board of Governors of the 
Federal Reserve Bank and the Pennsylvania Department of Banking.  SUN files 
quarterly and annual reports with the Federal Reserve Bank (FRB) of Philadelphia
and periodic on-site exams of SUN are done by the FRB.  Regular examinations of 
the Bank are conducted by the FDIC and the Pennsylvania Department of Banking. 
	
  SUN and the Pennsylvania SUN Life Insurance Company do not have any employees.
At December 31, 1998, the Bank employed 218 persons.  The Bank offers a variety 
of benefit programs and feels its relationship with its employees is good. 

ITEM 2 - PROPERTIES

 	SUN's corporate office is located in Sun Bank's main banking office.  SUN owns
all of its properties with the exception of an off-site ATM, (Item 8), 
Johnsonburg (Item 13), Pine Street (Item 16) and the Operations Center (Item 19)
which are leased.  In 1995, SUN purchased parcels of land in Liverpool for the 
purpose of building a branch in the future. On June 30, 1997, SUN completed its 
acquisition of Bucktail Bank and Trust Company.  This acquisition added eight 
additional locations.  In 1998, property was acquired in Williamsport for the 
purpose of constructing a financial services center.  Construction is scheduled 
to begin in 1999.  All properties are in good condition and adequate for the 
bank's purposes.  The following is a list of the banking offices, the addresses,
and a brief description of each office.

 	      Office				      Address				                             Description
        ------          -------                                 -----------
  1.  Main			           2-16 South Market Street			          	Brick structure
				                    Selinsgrove, Pennsylvania 17870

  2.  Shamokin Dam		    200 S. Susquehanna Trail		           	Brick structure
                    				Shamokin Dam, Pennsylvania  17876			
				
  3.  New Berlin	      	Market & Plum Streets			             	Brick structure
                    				New Berlin, Pennsylvania  17855

  4.  Sunbury		        	11 South Second Street		            		Brick structure
                    				Sunbury, Pennsylvania  17801

  5.  Middleburg		      Route 522 & Dock Hill Road		        		Brick structure
                    				Middleburg, Pennsylvania  17842

  6.  Trust Division	  	100 West Pine Street				             	Brick structure
                    				Selinsgrove, Pennsylvania  17870

  7.  Automated Teller		108 West Pine Street				             	Brick structure
      Machine	        		Selinsgrove, Pennsylvania  17870		

  8.  Automated Teller		700 North Broad Street				            Brick structure
      Machine			        Selinsgrove, Pennsylvania  17870

<PAGE>
  9.  Watsontown		      300 Main Street			                  		Brick structure
			                    	Watsontown,  Pennsylvania  17777

10.  Northumberland		   96 Duke Street					                   Brick structure
 				                   Northumberland, Pennsylvania  17857

11.  Liverpool			       Rts. 11 & 15 South				               	Land
 				                   Liverpool, Pennsylvania  17045

12.  Emporium		         2 East Fourth Street				             	Brick structure
                    				Emporium, PA  15834

13.  Johnsonburg		      RR 2 Box 1A					                     	Brick structure
                    				Johnsonburg, PA  15845

14.  Hughesville		      2 South Main Street					              Brick structure
                    				Hughesville, PA  17737

15.  Newberry			        2131 W. Fourth Street				            	Brick structure
                    				Williamsport, PA  17701

16.  Pine Street		      330 Pine Street					                  Brick structure
                    				Williamsport, PA  17701

17.  Montoursville		    301 Broad Street					                 Brick structure
                    				Montoursville, PA  17754

18.  Squire Hays		      3155 Lycoming Creek Road			           Stone and frame
                    				Williamsport, PA  17701	              structure

19.  Operations Center 	210 Market Street				                	Brick structure
                    				Williamsport, PA  17701	

ITEM 3 - LEGAL PROCEEDINGS

 	Various legal actions arise against the Corporation in the normal course of 
business.  In the opinion of management and counsel, when such actions currently
pending or threatened have been resolved, they should not have a material 
adverse effect on the business or financial condition of the Corporation.


ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SHAREHOLDERS 
 	Not applicable
<PAGE>
                                     PART II
                                     -------
ITEM 5 - MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED SHAREHOLDER 
         MATTERS

 	In April 1993, the common stock of SUN BANCORP, INC. began trading publicly on
the NASDAQ national market system under the symbol SUBI.  Prior to this date, 
the stock was not traded on an established stock exchange; however, it was 
traded on the over-the-counter market.  As of March 4, 1999, SUN had 
approximately 1,976 holders of its common stock.  SUN offers its shareholders a 
Dividend Reinvestment Plan whereby holders of stock may have their quarterly 
cash dividends automatically invested in additional shares of common stock of 
SUN.  

 	The payment of dividends by SUN is at the discretion of the Board of Directors
and to the extent funds are legally available for that purpose.  SUN may not pay
dividends in any year in excess of the total of the current year's net income 
and the retained net income of the prior two years without the approval of the 
Federal Reserve Bank.  Additionally, bank regulations limit the amount of 
dividends that may be paid to SUN by the subsidiary bank without prior approval 
from the regulatory agencies.

 	Additional stock information is incorporated by reference to Shareholder 
Information found on page 44 of the 1998 Annual Report to Shareholders.


ITEM 6 - SELECTED FINANCIAL DATA

 	This item is incorporated by reference to information under the heading Five 
Year Financial Highlights on page 25 of the 1998 Annual Report to Shareholders.


ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

 	This item is incorporated by reference to Management's Discussion and Analysis
on pages 26 through 43 of the 1998 Annual Report to Shareholders.

ITEM 7A - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 	This item is incorporated by reference to Management's Discussion and Analysis
on pages 37 through 40 of the 1998 Annual Report to Shareholders. 

ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

 	This item is incorporated by reference to the Consolidated Financial 
Statements, Notes to Consolidated Financial Statements and Independent Auditors'
Report set forth on pages 4 through 24 of the 1998 Annual Report to 
Shareholders.

ITEM 9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND 
         FINANCIAL DISCLOSURE

 	None
<PAGE>
                                     PART III
                                     --------
ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT

 	Information concerning directors and executive officers of the Registrant is 
incorporated herein by reference to Board of Directors on page 6 of the 
Corporation's 1999 Proxy Statement.

 	Information regarding disclosure of delinquent filers pursuant to Item 405 of 
Regulation S-K is incorporated herein by reference to Compliance with Securities
and Exchange Act on page 19 of the Corporation's 1999 Proxy Statement.


ITEM 11 - EXECUTIVE COMPENSATION

 	Information relating to management remuneration and compensation is 
incorporated herein by reference to Executive Compensation and Other Information
on page 13 of the 1999 Proxy Statement.


ITEM 12 - SECURITY OWNERSHIP OR CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

 	This information is incorporated by reference to Security Ownership of 
Directors and Executive Officers of the Corporation on page 10 of the 1999 Proxy
Statement.


ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

 	This information is incorporated by reference to footnote 15 on page 19 of 
the 1998 Annual Report to Shareholders and under the heading of Transactions 
with Management on page 19 of the 1999 Proxy Statement.


                                     PART IV
                                     -------
ITEM 14 - EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

  (a)(1)  The following consolidated financial statements and independent 
          auditors' report of SUN BANCORP, INC. and subsidiaries included in the
          Annual Report to Shareholders for the year ended December 31, 1998 are
          incorporated by reference in Part II, Item 8:

    	     Consolidated Balance Sheets - December 31, 1998 and 1997

    	     Consolidated Statements of Income - Years Ended December 31, 1998, 
          1997, and 1996	

          Consolidated Statements of Changes in Shareholders' Equity - Years 
          Ended December 31, 1998, 1997, and 1996

<PAGE>
	         Consolidated Statements of Cash Flows - Years Ended December 31, 1998,
          1997, and 1996

    	     Notes to Consolidated Financial Statements

    	     Independent Auditors' Report 

     (2)  All schedules applicable to the Registrant are shown in the respective
          financial statements or the notes thereto.  Financial statement 
          schedules not included are omitted because the information is not 
          required under the related instructions or it is inapplicable.

     (3)  Exhibits
		        3(i)  The Articles of Incorporation of the Corporation are 
                incorporated herein by reference to Exhibit 3 to the 
                Corporation's Annual Report on Form 10-K for the year ended 
                December 31, 1993 (Commission File Number 0-14745).

          3(ii) The By-Laws, as amended and restated, are incorporated herein by
                reference to Exhibit 3 to the Corporation's Annual Report on 
                Form 10-K for the year ended December 31, 1993 (Commission File 
                Number 0-14745).

          13    Annual Report to Shareholders of SUN BANCORP, INC. for the year
      	         ended December 31, 1998 is filed herewith.  Such report, except 
                for those portions thereof which are expressly incorporated by 
                reference herein, is furnished for information of the Securities
                and Exchange Commission only and it is not considered "filed" as
                part of the Form 10-K filing.

          21    Subsidiaries of the Registrant are filed herewith.

          22    Published Report Regarding Matters Submitted To Vote Of 
                Shareholders is filed herewith, the 1999 Proxy Statement of SUN 
                BANCORP, INC.

       		 22    Consent of Independent Auditors is filed herewith.


  (b) 	No reports on Form 8-K were required to be filed during the fourth 
       quarter of 1998.

  (c) 	Exhibits - the required exhibits are included under Item 14(a) (3) of the
       Form 10-K.

  (d) 	Financial statement schedules are omitted because the required 
       information is not	applicable or is included elsewhere herein.

<PAGE>
                                    SIGNATURES
                                    ----------
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange 
Act of 1934, SUN BANCORP, INC. has duly caused this report to be signed on its 
behalf by the undersigned, thereunto duly authorized.




                   							                    SUN BANCORP, INC.	
                                        -----------------------------
                                                (Registrant)		

Date:     3/25/99	                    		By: 	/s/ Fred W. Kelly, Jr.	
      ---------------                        -----------------------------------
                                            	Fred W. Kelly, Jr.  
                                             President & Chief Executive Officer


Date:     3/25/99         	             By: /s/ Jeffrey E. Hoyt		
      ---------------                       ------------------------------------
                               		           Jeffrey E. Hoyt
                               		           Executive Vice President, Chief 			 
                                            Operating Officer and Secretary 	
                                            (Principal Financial Officer and 
                                            Principal Accounting Officer)

	





Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed on behalf of the Registrant and in the capacities and on the 
dates indicated.




<PAGE>
		            Name							                                         Date
              ----                                               -------
/s/ Fred W. Kelly, Jr.                                           3/25/99	
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Fred W. Kelly, Jr. 
President, Chief Executive Officer and Director

/s/ Jeffrey E. Hoyt                                              3/25/99	
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Jeffrey E. Hoyt 
Executive Vice President, Secretary and 
Chief Operating Officer

/s/ Max E. Bingaman                                              3/25/99		
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Max E. Bingaman, Director

/s/ David R. Dieck                                               3/25/99		
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David R. Dieck, Director

/s/ Louis A. Eaton                                               3/25/99	
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Louis A. Eaton, Director

/s/ Dr. Robert E. Funk                                           3/25/99	
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Dr. Robert E. Funk, Director		

                                                                 3/25/99	
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Stephen J. Gurgovits, Director

/s/ Thomas B. Hebble                                             3/25/99	 
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Thomas B. Hebble, Director 
	
/s/ Robert A. Hormell                                            3/25/99		
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Robert A. Hormell, Director

                                                                 3/25/99		
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Paul R. John, Director

/s/ George F. Keller                                             3/25/99		
-----------------------------------------------                  -------
George F. Keller, Director	

/s/ Lehman B. Mengel                                             3/25/99		
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Lehman B. Mengel, Director

/s/ Howard H. Schnure                                            3/25/99		
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Howard H. Schnure, Director

/s/ Marlin T. Sierer                                             3/25/99		
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Marlin T. Sierer, Director

/s/ Jerry A. Soper                                               3/25/99		
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Jerry A. Soper, Director

/s/ Dennis J. Van                                                3/25/99		
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Dennis J. Van, Director                                          
<PAGE>