<PAGE>

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

                              ---------------------

                                    FORM 10-Q

                              ---------------------


(Mark one)
   [X]         QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                  For the quarterly period ended June 30, 1999

                                       OR

   [_]         TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                     For the transition period from      to


                          Commission File Number 1-6875


                         BELL ATLANTIC - MARYLAND, INC.


A Maryland Corporation            I.R.S. Employer Identification No. 52-0270070


                One East Pratt Street, Baltimore, Maryland 21202


                         Telephone Number (410) 539-9900

                            -------------------------



THE REGISTRANT, A WHOLLY OWNED SUBSIDIARY OF BELL ATLANTIC CORPORATION, MEETS
THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a) AND (b) OF FORM 10-Q AND
IS THEREFORE FILING THIS FORM WITH REDUCED DISCLOSURE FORMAT PURSUANT TO GENERAL
INSTRUCTION H(2).


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

                         Bell Atlantic - Maryland, Inc.

                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements


                         CONDENSED STATEMENTS OF INCOME
                                   (Unaudited)
                              (Dollars in Millions)

<TABLE>
<CAPTION>

                                                                  Three Months Ended                    Six Months Ended
                                                                        June 30,                            June 30,
                                                        ----------------------------------------------------------------------------
                                                                 1999               1998             1999              1998
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                          <C>               <C>                <C>               <C>
OPERATING REVENUES (including $17.4,
 $14.0, $31.7 and $28.2 from affiliates)                             $   568.5         $    523.8         $1,113.1          $1,051.7
                                                        ----------------------------------------------------------------------------

OPERATING EXPENSES
Employee costs, including benefits and taxes                              84.8               85.9            169.2             169.4
Depreciation and amortization                                            112.5              109.2            223.6             215.7
Other (including $124.0, $132.5,
 $236.8 and $253.9 to affiliates)                                        191.8              206.6            373.5             396.1
                                                        ----------------------------------------------------------------------------
                                                                         389.1              401.7            766.3             781.2
                                                        ----------------------------------------------------------------------------

OPERATING INCOME                                                         179.4              122.1            346.8             270.5

OTHER INCOME, NET (including $.1, $0,
 $.1 and $0 from affiliates)                                                .3                2.6               .8               2.9

INTEREST EXPENSE (including $1.5,
 $1.9, $3.5 and $3.7 to affiliate)                                        18.1               17.0             35.8              34.4
                                                        ----------------------------------------------------------------------------

INCOME BEFORE PROVISION FOR INCOME TAXES                                 161.6              107.7            311.8             239.0

PROVISION FOR INCOME TAXES                                                59.7               40.0            117.3              89.3
                                                        ----------------------------------------------------------------------------

NET INCOME                                                           $   101.9         $     67.7         $  194.5          $  149.7
                                                        ============================================================================
</TABLE>

                  See Notes to Condensed Financial Statements.

                                       1
<PAGE>

                         Bell Atlantic - Maryland, Inc.

                            CONDENSED BALANCE SHEETS
                                   (Unaudited)
                              (Dollars in Millions)


                                     ASSETS
                                     ------

<TABLE>
<CAPTION>

                                                                    June 30,               December 31,
                                                                      1999                     1998
-----------------------------------------------------------------------------------------------------------
<S>                                                                 <C>                     <C>
CURRENT ASSETS
Short-term investments                                                     $   10.8                $   32.5
Accounts receivable:
 Trade and other, net of allowances for
       uncollectibles of $34.7 and $29.3                                      408.2                   422.3
 Affiliates                                                                    38.9                    45.7
Material and supplies                                                           8.8                    10.0
Prepaid expenses                                                               20.8                    52.9
Deferred income taxes                                                            .2                     ---
                                                           ------------------------------------------------
                                                                              487.7                   563.4
                                                           ------------------------------------------------

PLANT, PROPERTY AND EQUIPMENT                                               6,474.4                 6,292.5
Less accumulated depreciation                                               3,763.5                 3,614.0
                                                           ------------------------------------------------
                                                                            2,710.9                 2,678.5
                                                           ------------------------------------------------

OTHER ASSETS                                                                   36.0                    25.2
                                                           ------------------------------------------------

TOTAL ASSETS                                                               $3,234.6                $3,267.1
                                                           ================================================
</TABLE>

                  See Notes to Condensed Financial Statements.

                                       2
<PAGE>

                         Bell Atlantic - Maryland, Inc.

                            CONDENSED BALANCE SHEETS
                                   (Unaudited)
                              (Dollars in Millions)


                     LIABILITIES AND SHAREOWNER'S INVESTMENT
                     ---------------------------------------

<TABLE>
<CAPTION>

                                                                           June 30,             December 31,
                                                                             1999                   1998
----------------------------------------------------------------------------------------------------------------
<S>                                                                        <C>                  <C>
CURRENT LIABILITIES
Debt maturing within one year:
  Note payable to affiliate                                                      $  122.7               $  178.4
  Other                                                                             101.5                  101.4
Accounts payable and accrued liabilities:
  Affiliates                                                                        177.8                  203.5
  Other                                                                             279.3                  295.9
Other liabilities                                                                    70.6                   68.1
                                                                     -------------------------------------------
                                                                                    751.9                  847.3
                                                                     -------------------------------------------

LONG-TERM DEBT                                                                      858.0                  858.4
                                                                     -------------------------------------------

EMPLOYEE BENEFIT OBLIGATIONS                                                        349.5                  379.8
                                                                     -------------------------------------------

DEFERRED CREDITS AND OTHER LIABILITIES
Deferred income taxes                                                               151.0                  121.0
Unamortized investment tax credits                                                   11.3                   12.1
Other                                                                                86.4                   85.1
                                                                     -------------------------------------------
                                                                                    248.7                  218.2
                                                                     -------------------------------------------

SHAREOWNER'S INVESTMENT
Common stock - one share, without par value, owned by parent                        735.4                  735.4
Capital surplus                                                                      31.7                   31.7
Reinvested earnings                                                                 259.8                  196.7
Accumulated other comprehensive loss                                                  (.4)                   (.4)
                                                                     -------------------------------------------
                                                                                  1,026.5                  963.4
                                                                     -------------------------------------------

TOTAL LIABILITIES AND SHAREOWNER'S INVESTMENT                                    $3,234.6               $3,267.1
                                                                     ===========================================
</TABLE>

                  See Notes to Condensed Financial Statements.

                                       3
<PAGE>

                         Bell Atlantic - Maryland, Inc.

                       CONDENSED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                              (Dollars in Millions)

<TABLE>
<CAPTION>

                                                                                                Six Months Ended
                                                                                                     June 30,
                                                                          ---------------------------------------------
                                                                                              1999                 1998
-----------------------------------------------------------------------------------------------------------------------
<S>                                                                                       <C>                  <C>
NET CASH PROVIDED BY OPERATING ACTIVITIES                                                  $ 419.6              $ 368.9
                                                                          ---------------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES
Net change in short-term investments                                                          21.7                  8.3
Additions to plant, property and equipment                                                  (246.0)              (289.2)
Other, net                                                                                     1.1                 10.1
                                                                          ---------------------------------------------
Net cash used in investing activities                                                       (223.2)              (270.8)
                                                                          ---------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES
Principal repayments of borrowings and capital lease obligations                               (.6)                (4.0)
Net change in note payable to affiliate                                                      (55.7)                 ---
Dividends paid                                                                              (131.4)               (89.6)
Net change in outstanding checks drawn
     on controlled disbursement accounts                                                      (8.7)                (4.5)
                                                                          ---------------------------------------------
Net cash used in financing activities                                                       (196.4)               (98.1)
                                                                          ---------------------------------------------

NET CHANGE IN CASH                                                                             ---                  ---

CASH, BEGINNING OF PERIOD                                                                      ---                  ---
                                                                          ---------------------------------------------

CASH, END OF PERIOD                                                                        $   ---              $   ---
                                                                          =============================================
</TABLE>

                  See Notes to Condensed Financial Statements.

                                       4
<PAGE>

                         Bell Atlantic - Maryland, Inc.

                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)

1. Basis of Presentation

   Bell Atlantic - Maryland, Inc. is a wholly owned subsidiary of Bell
Atlantic Corporation (Bell Atlantic). The accompanying unaudited condensed
financial statements have been prepared based upon Securities and Exchange
Commission rules that permit reduced disclosure for interim periods. These
financial statements reflect all adjustments that are necessary for a fair
presentation of results of operations and financial position for the interim
periods shown including normal recurring accruals. The results for the interim
periods are not necessarily indicative of results for the full year. For a more
complete discussion of significant accounting policies and certain other
information, you should refer to the financial statements included in our Annual
Report on Form 10-K for the year ended December 31, 1998.

   We have reclassified certain amounts from the prior year's data to conform
to the 1999 presentation.

2. Dividend

   On August 2, 1999, we declared and paid a dividend in the amount of $77.6
million to Bell Atlantic.

3. New Accounting Standards

Costs of Computer Software

   Effective January 1, 1999, we adopted Statement of Position (SOP) No. 98-1,
"Accounting for the Costs of Computer Software Developed or Obtained for
Internal Use." Under SOP No. 98-1, we capitalize the cost of internal-use
software which has a useful life in excess of one year. Subsequent additions,
modifications or upgrades to internal-use software are capitalized only to the
extent that they allow the software to perform a task it previously did not
perform. Software maintenance and training costs are expensed in the period in
which they are incurred. Also, we now capitalize interest associated with the
development of internal-use software. The effect of adopting SOP No. 98-1 for
Bell Atlantic was an increase in net income of approximately $115 million for
the six months ended June 30, 1999.

Costs of Start-Up Activities

   Effective January 1, 1999, we adopted SOP No. 98-5, "Reporting on the
Costs of Start-up Activities." Under this accounting standard, we expense costs
of start-up activities as incurred, including pre-operating, pre-opening and
other organizational costs. The adoption of SOP No. 98-5 did not have a material
effect on our results of operations or financial condition because we have not
historically capitalized start-up activities.

Derivatives and Hedging Activities

   In June 1998, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for
Derivative Instruments and Hedging Activities." This statement requires that all
derivatives be measured at fair value and recognized as either assets or
liabilities on our balance sheet. Changes in the fair values of derivative
instruments will be recognized in either earnings or comprehensive income,
depending on the designated use and effectiveness of the instruments. The FASB
amended this pronouncement in June 1999 to defer the effective date of SFAS No.
133 for one year.

   Under the amended pronouncement, we must adopt SFAS No. 133 no later than
January 1, 2001. The adoption of SFAS No. 133 will have no material effect on
our results of operations or financial condition because we currently do not
enter into the use of derivative instruments or participate in hedging
activities.

                                       5
<PAGE>

                         Bell Atlantic - Maryland, Inc.

4. Shareowner's Investment

<TABLE>
<CAPTION>

                                                                                                                   Accumulated
                                                                                                                      Other
                                                            Common            Capital           Reinvested        Comprehensive
(Dollars in Millions)                                        Stock            Surplus            Earnings              Loss
---------------------------------------------------------------------------------------------------------------------------------
<S>                                                         <C>               <C>               <C>               <C>
Balance at December 31, 1998                                      $735.4             $31.7              $196.7               $(.4)
Net income                                                                                               194.5
Dividends paid to Bell Atlantic                                                                         (131.4)
                                                      ---------------------------------------------------------------------------
Balance at June 30, 1999                                          $735.4             $31.7              $259.8               $(.4)
                                                      ===========================================================================
</TABLE>

   Net income and comprehensive income were the same for the six months ended
June 30, 1999 and 1998.

5. Litigation and Other Contingencies

   Various legal actions and regulatory proceedings are pending to which we are
a party. We have established reserves for specific liabilities in connection
with regulatory and legal matters that we currently deem to be probable and
estimable. We do not expect that the ultimate resolution of pending regulatory
and legal matters in future periods will have a material effect on our financial
condition, but it could have a material effect on our results of operations.

6. Proposed Bell Atlantic - GTE Merger

   Bell Atlantic and GTE Corporation (GTE) have announced a proposed merger
of equals under a definitive merger agreement dated as of July 27, 1998. Under
the terms of the agreement, GTE shareholders will receive 1.22 shares of Bell
Atlantic common stock for each share of GTE common stock that they own. Bell
Atlantic shareholders will continue to own their existing shares after the
merger.

   It is expected that the merger will qualify as a pooling of interests, which
means that for accounting and financial reporting purposes the companies will be
treated as if they had always been combined. At annual meetings held in May
1999, the shareholders of each company approved the merger. The completion of
the merger is subject to a number of conditions, including certain regulatory
approvals and receipt of opinions that the merger will be tax-free.

   Bell Atlantic and GTE are working diligently to complete the merger at the
earliest practicable date. However, the companies must obtain the approval of a
variety of state and federal regulatory agencies and, accordingly, the merger
may close in the first half of 2000.

                                       6
<PAGE>

                         Bell Atlantic - Maryland, Inc.

Item 2.  Management's Discussion and Analysis of Results of Operations
         (Abbreviated pursuant to General Instruction H(2).)

   This discussion should be read in conjunction with the Financial
Statements and Notes to Financial Statements.


RESULTS OF OPERATIONS
---------------------

   We reported net income of $194.5 million for the six months ended June 30,
1999, compared to net income of $149.7 million for the same period in 1998.

   Our results for 1999 and 1998 were affected by special items. The special
items in both periods include our allocated share of charges from Bell Atlantic
Network Services, Inc. (NSI).

   The following table shows how special items are reflected in our condensed
statements of income for each period:

<TABLE>
<CAPTION>
                                                               (Dollars in Millions)
Six Months Ended June 30                                    1999                1998
------------------------------------------------------------------------------------
<S>                                           <C>                 <C>
Employee Costs
 Merger transition costs                                   $ ---               $  .3

Other Operating Expenses
 Merger transition costs                                      .6                 2.0
 Allocated transition costs                                  2.7                 1.2
                                            ----------------------------------------
                                                           $ 3.3               $ 3.5
                                            ========================================
</TABLE>

Merger-related Costs

   In connection with the Bell Atlantic-NYNEX merger, which was completed in
August 1997, we recorded pre-tax transition and integration costs of $3.3
million in the first six months of 1999 and $3.5 million in the first six months
of 1998.

   Transition and integration costs consist of our proportionate share of
costs associated with integrating the operations of Bell Atlantic and NYNEX,
such as systems modifications costs and advertising and branding costs.
Transition and integration costs are expensed as incurred.



OPERATING REVENUE STATISTICS
----------------------------

                                              1999       1998       % Change
-------------------------------------------------------------------------------
At June 30
----------
Access Lines in Service (in thousands)
 Residence                                         2,405      2,313         4.0%
 Business                                          1,413      1,302         8.5
 Public                                               41         41          --
                                          -------------------------
                                                   3,859      3,656         5.6
                                          =========================
Six Months Ended June 30
------------------------
Access Minutes of Use (in millions)                8,187      7,699         6.3
                                          =========================

                                       7
<PAGE>

                         Bell Atlantic - Maryland, Inc.

OPERATING REVENUES
------------------
(Dollars in Millions)

<TABLE>
<CAPTION>
Six Months Ended June 30                       1999                  1998
----------------------------------------------------------------------------------
<S>                                    <C>                    <C>
Local services                                      $  647.3              $  614.5
Network access services                                302.6                 280.1
Long distance services                                  45.3                  44.6
Ancillary services                                     117.9                 112.5
                                      --------------------------------------------
Total                                               $1,113.1              $1,051.7
                                      ============================================
</TABLE>

LOCAL SERVICES REVENUES

   1999 - 1998                                    Increase
--------------------------------------------------------------------------------
   Six Months                                   $32.8   5.3%
--------------------------------------------------------------------------------

   Local services revenues are earned from the provision of local exchange,
local private line, public telephone (pay phone) and value-added services.
Value-added services are a family of services that expand the utilization of the
network. These services include products such as Caller ID, Call Waiting and
Return Call.

   Growth in local services revenues in 1999 was primarily due to higher
usage of our network facilities. This growth was generated, in part, by an
increase in access lines in service of 5.6% from June 30, 1998. Access line
growth primarily reflects higher demand for Centrex services and an increase in
additional residential lines.

   Local services revenue growth in 1999 also reflects strong customer demand
and usage of our data transport and digital services. Revenues from our
value-added services were boosted in 1999 by marketing and promotional campaigns
offering new service packages.

   Growth in local services revenues was partially offset by a decline in
revenues from our pay phone services, due to the increasing popularity of
wireless communications. In addition, the resale of access lines and the
provision of unbundled network elements to competitive local exchange carriers
reduced revenues in 1999. Price reductions on local exchange services also
offset increases in local services revenues.


NETWORK ACCESS SERVICES REVENUES

   1999 - 1998                                    Increase
--------------------------------------------------------------------------------
   Six Months                                   $22.5   8.0%
--------------------------------------------------------------------------------

   Network access services revenues are earned from end-user subscribers and
long distance and other competing carriers who use our local exchange facilities
to provide usage services to their customers. Switched access revenues are
derived from fixed and usage-based charges paid by carriers for access to our
local network. Special access revenues originate from carriers and end-users
that buy dedicated local exchange capacity to support their private networks.
End-user access revenues are earned from our customers and from resellers who
purchase dial-tone services.

   Network access services revenue growth in 1999 was mainly attributable to
higher customer demand, as reflected by growth in access minutes of use of 6.3%
from the same period in 1998. Volume growth also reflects a continuing expansion
of the business market, particularly for high-capacity services. In 1999, demand
for special access services increased, reflecting a greater utilization of our
network. Higher network usage by alternative providers of intraLATA toll
services and higher end-user revenues attributable to an increase in access
lines in service also contributed to revenue growth in 1999.

   Volume-related growth was partially offset by net price reductions
mandated by a federal price cap plan. The Federal Communications Commission
(FCC) regulates the rates that we charge long distance carriers and end-user
subscribers for interstate access services. We are required to file new access
rates with the FCC each year under the rules of the Price Cap Plan.

                                       8
<PAGE>

                        Bell Atlantic - Maryland, Inc.

   In July 1999, we implemented interstate price decreases of approximately $2
million on an annual basis in connection with the FCC's Price Cap Plan. The rate
changes include amounts necessary to recover our contributions to the FCC's
universal service fund, which are included in Other Operating Expenses. The FCC
has created a multi-billion dollar interstate fund to link schools and libraries
to the Internet and to subsidize low-income customers and rural health care
providers. Under the FCC's rules, all providers of interstate telecommunications
services must contribute to the universal service fund. Contributions to the
schools and libraries fund have been assessed based on total interstate and
intrastate retail revenues. As described in Other Matters - FCC Regulation and
Interstate Rates - Universal Service, the U.S. Court of Appeals recently
reversed the decision to include intrastate revenues in the calculation of
contributions to the schools and libraries fund. It also reversed the decision
to require local telephone companies to recover their universal service
contributions through access charges rather than charges to their end-user
customers. Our rates are subject to change every quarter due to potential
increases or decreases in our contribution to the universal service fund. The
July 1999 rate changes include an annual increase of approximately $6 million in
the required contributions to this fund. These rates will be in effect through
June 2000. Interstate price decreases were $7 million on an annual basis for the
period July 1998 through June 1999. These rates were increased by approximately
$4 million on an annual basis for the period January 1999 through June 1999 to
reflect primarily the unification of pre-merger Bell Atlantic and NYNEX access
rates.

LONG DISTANCE SERVICES REVENUES

   1999 - 1998                                    Increase
--------------------------------------------------------------------------------
   Six Months                                   $.7     1.6%
--------------------------------------------------------------------------------

   Long distance services revenues are earned primarily from calls made to
points outside a customer's local calling area, but within our service area
(intraLATA toll). Other long distance services that we provide include 800
services and Wide Area Telephone Service (WATS).

   The increase in long distance services revenues was due to additional
revenues generated from higher calling volumes. This growth in long distance
services revenues was offset by the competitive effects of the introduction of
presubscription for intraLATA toll services and price reductions on certain toll
services. Presubscription, which was introduced in May 1999, permits customers
to use an alternative provider of their choice for intraLATA toll calls without
dialing a special access code when placing a call. In response to
presubscription, we have implemented customer win-back and retention initiatives
that include toll calling discount packages and product bundling offers.


ANCILLARY SERVICES REVENUES

   1999 - 1998                                    Increase
--------------------------------------------------------------------------------
   Six Months                                   $5.4    4.8%
--------------------------------------------------------------------------------

   Our ancillary services include such services as billing and collections for
long distance carriers and affiliates, facilities rentals to affiliates and
nonaffiliates, collocation by competitive local exchange carriers, usage of
separately priced (unbundled) components of our network by competitive local
exchange carriers, voice messaging, customer premises equipment (CPE) and wiring
and maintenance services, and sales of materials and supplies to affiliates.
Ancillary services revenues also include fees paid by customers for
nonpublication of telephone numbers and multiple white page listings and fees
paid by an affiliate for usage of our directory listings.

   Ancillary services revenues were higher in 1999 due to increased demand
for billing and collection services, higher payments from competitive local
exchange carriers for interconnection of their network with our network and
higher facilities rental revenues from affiliates. Lower revenues from CPE and
installation services provided to federal government customers partially offset
these increases.

                                       9
<PAGE>

                         Bell Atlantic - Maryland, Inc.


OPERATING EXPENSES
------------------
(Dollars in Millions)

<TABLE>
<CAPTION>
Six Months Ended June 30                                  1999          1998
------------------------------------------------------------------------------------
<S>                                                  <C>               <C>
Employee costs, including benefits and taxes                    $169.2        $169.4
Depreciation and amortization                                    223.6         215.7
Other operating expenses                                         373.5         396.1
                                                    --------------------------------
Total                                                           $766.3        $781.2
                                                    ================================
</TABLE>

EMPLOYEE COSTS

   1999 - 1998                                   (Decrease)
--------------------------------------------------------------------------------
   Six Months                                   $(.2)    (.1)%
--------------------------------------------------------------------------------

   Employee costs consist of salaries, wages and other employee compensation,
employee benefits and payroll taxes paid directly by us. Similar costs incurred
by employees of NSI, who provide centralized services on a contract basis, are
allocated to us and are included in Other Operating Expenses.

   Employee costs decreased in the first six months of 1999 primarily as a
result of lower pension and benefit costs and a reduction in associate overtime
pay. Annual salary and wage increases for management and associate employees and
the effect of higher work force levels substantially offset these cost
reductions.

   The decline in pension and benefit costs was due to a number of factors,
principally, lower pension costs as a result of favorable pension plan
investment returns and changes in plan provisions and actuarial assumptions.
These factors were partially offset by increased health care costs caused by
inflation and benefit plan improvements provided for under new contracts with
associate employees.


DEPRECIATION AND AMORTIZATION

   1999 - 1998                                    Increase
--------------------------------------------------------------------------------
   Six Months                                   $7.9     3.7%
--------------------------------------------------------------------------------

   Depreciation and amortization expense increased in the first six months of
1999 over the same period in 1998 principally as a result of growth in
depreciable telephone plant and changes in the mix of plant assets. The adoption
of Statement of Position (SOP) No. 98-1, "Accounting for the Costs of Computer
Software Developed or Obtained for Internal Use" also contributed to the
increase in depreciation and amortization expense in the first six months of
1999, but to a lesser extent. Under this new accounting standard, computer
software developed or obtained for internal use is now capitalized and
amortized. Previously, we expensed most of these software purchases as incurred.
For additional information on SOP No. 98-1, see Note 3 to the condensed
financial statements. These expense increases were partially offset by the
effect of lower rates of depreciation.


OTHER OPERATING EXPENSES

   1999 - 1998                                   (Decrease)
--------------------------------------------------------------------------------
   Six Months                                  $(22.6) (5.7)%
--------------------------------------------------------------------------------

   Other operating expenses consist of contract services including
centralized services expenses allocated from NSI, rent, network software costs,
operating taxes other than income, the provision for uncollectible accounts
receivable, and other costs.

   The decrease in other operating expenses in the first six months of 1999
was largely attributable to the effect of adopting SOP No. 98-1 and a reduction
in centralized services expenses allocated from NSI, primarily as a result of
lower employee costs incurred by NSI. Lower rent expense also contributed to the
decrease in other operating expenses.

                                       10
<PAGE>

                         Bell Atlantic - Maryland, Inc.


OTHER INCOME, NET

   1999 - 1998                                   (Decrease)
--------------------------------------------------------------------------------
   Six Months                                  $(2.1)  (72.4)%
--------------------------------------------------------------------------------

      The change in other income, net, was attributable to the recognition of
interest income in connection with the settlement of tax-related matters in
1998.


INTEREST EXPENSE

   1999 - 1998                                    Increase
--------------------------------------------------------------------------------
   Six Months                                   $1.4    4.1%
--------------------------------------------------------------------------------

   Interest expense includes costs associated with borrowings and capital
leases, net of interest capitalized as a cost of acquiring or constructing plant
assets.

   Interest expense increased in the first six months of 1999 over the same
period in 1998 principally due to a reduction in capitalized interest costs
primarily resulting from lower levels of average telephone plant under
construction.


EFFECTIVE INCOME TAX RATES

   Six Months Ended June 30
--------------------------------------------------------------------------------
   1999                                       37.6%
--------------------------------------------------------------------------------
   1998                                       37.4%
--------------------------------------------------------------------------------

   The effective income tax rate is the provision for income taxes as a
percentage of income before the provision for income taxes. Our effective income
tax rate was higher in the first six months of 1999 principally due to lower
state income tax credits recorded in 1999.



FINANCIAL CONDITION
-------------------

   We use the net cash generated from operations and from external financing
to fund capital expenditures for network expansion and modernization, and pay
dividends. While current liabilities exceeded current assets at both June 30,
1999 and 1998 and December 31, 1998, our sources of funds, primarily from
operations and, to the extent necessary, from readily available financing
arrangements with an affiliate, are sufficient to meet ongoing operating
requirements. Management expects that presently foreseeable capital requirements
will continue to be financed primarily through internally generated funds.
Additional long-term debt may be needed to fund development activities or to
maintain our capital structure to ensure financial flexibility.

   As of June 30, 1999, we had $125.5 million of an unused line of credit with
an affiliate, Bell Atlantic Network Funding Corporation. In addition, we had
$50.0 million remaining under a shelf registration statement filed with the
Securities and Exchange Commission for the issuance of unsecured debt
securities. Our debt securities continue to be accorded high ratings by primary
rating agencies. Subsequent to the announcement of the Bell Atlantic - GTE
merger, rating agencies have maintained current credit ratings, but have placed
our ratings under review for potential downgrade.

   Our debt ratio was 51.3% at June 30, 1999, compared to 55.6% at June 30,
1998 and 54.2% at December 31, 1998.

   On August 2, 1999, we declared and paid a dividend in the amount of $77.6
million to Bell Atlantic.

                                       11
<PAGE>

                         Bell Atlantic - Maryland, Inc.


OTHER MATTERS
-------------

FCC Regulation and Interstate Rates

   Price Caps

   In May 1999, the U.S. Court of Appeals reversed the FCC's establishment of a
6.5% productivity factor in calculating the annual price cap index applied to
our interstate access rates. The court directed the FCC to reconsider and
explain the methods used in selecting the productivity factor. The court granted
the FCC a stay of its order, however, until April 1, 2000. As a result, our
annual price cap filing effective July 1, 1999 includes the effects of the FCC's
6.5% productivity factor (see Operating Revenues - Network Access Services).

   Universal Service

   On July 30, 1999, the U.S. Court of Appeals reversed certain aspects of the
FCC's universal service order. While the court generally upheld the FCC's rules
creating a fund to support service to schools and libraries, it reversed that
portion of the rules that included intrastate revenues as part of the basis for
assessing contributions to that fund. The court also reversed the portion of the
FCC's order that required local telephone companies to recover their universal
service contributions generally through increases to their interstate access
revenues, rather than through charges directly to their end-user customers.

Recent Accounting Pronouncement - Derivatives and Hedging Activities

   In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards (SFAS) No. 133, "Accounting for Derivative
Instruments and Hedging Activities." This statement requires that all
derivatives be measured at fair value and recognized as either assets or
liabilities on our balance sheet. Changes in the fair values of the derivative
instruments will be recognized in either earnings or comprehensive income,
depending on the designated use and effectiveness of the instruments. The FASB
amended this pronouncement in June 1999 to defer the effective date of SFAS No.
133 for one year.

   Under the amended pronouncement, we must adopt SFAS No. 133 no later than
January 1, 2001. The adoption of SFAS No. 133 will have no material effect on
our results of operations or financial condition because we currently do not
enter into the use of derivative instruments or participate in hedging
activities.

Year "2000" Update

   Bell Atlantic has a comprehensive program to evaluate and address the
impact of the Year 2000 date transition on its subsidiaries' operations,
including our operations. This program includes steps to:

        .   inventory and assess for Year 2000 compliance our equipment,
            software and systems;

        .   determine whether to remediate, replace or retire noncompliant
            items, and establish a plan to accomplish these steps;

        .   remediate, replace or retire the items;

        .   test the items, where required; and

        .   provide management with reporting and issues management to support a
            seamless transition to the Year 2000.

State of Readiness

   For Bell Atlantic's operating telephone subsidiaries, centralized services
   entities and general corporate operations, the program focuses on the
   following project groups: Network Elements, Applications and Support Systems,
   and Information Technology Infrastructure. Bell Atlantic's goal for these
   operations was to have its network and other mission critical systems Year
   2000 compliant (including testing) by June 30, 1999 and it has substantially
   met this goal. What follows is a more detailed breakdown of Bell Atlantic's
   efforts to date.

 .  Network Elements

   Approximately 350 different types of network elements (such as central office
   switches) appear in over one hundred thousand instances. When combined in
   various ways and using network application systems, these elements are the
   building blocks of customer services and networked information transmission
   of all kinds. Bell Atlantic originally assessed approximately 70% of these
   element types, representing over 90% of all deployed network elements, as
   Year 2000 compliant. As of July 31, 1999, Bell Atlantic has completed the
   repair/replacement for approximately 99% of deployed

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   network elements requiring remediation. Bell Atlantic's plan is to
   remediate/replace or where applicable retire, the remaining elements prior to
   August 31, 1999, with the following exceptions: two element types which are
   planned for remediation/replacement in September, and a single switch in New
   York which, under an agreement with the New York Public Service Commission,
   is scheduled to be retired later this year.

 .  Application and Support Systems

   Bell Atlantic has approximately 1,200 application and systems that support:
   (i) the administration and maintenance of its network and customer service
   functions (network information systems); (ii) customer care and billing
   functions; and (iii) human resources, finance and general corporate
   functions. Bell Atlantic originally assessed approximately 48% of these
   application and support systems as either compliant or to be retired. As of
   July 31, 1999, Bell Atlantic has successfully completed repair/replacement of
   more than 99% of all mission critical application and support systems. The
   remaining systems are scheduled for remediation/replacement or retirement
   prior to August 31, 1999, with the exception of certain accounting subsystems
   scheduled for replacement in October 1999.

 .  Information Technology Infrastructure

   Approximately 40 mainframe, 1,000 mid-range, and 90,000 personal computers,
   related network components, and software products comprise Bell Atlantic's
   information technology (IT) infrastructure. Of the approximately 1,350 unique
   types of elements in the inventory for the IT infrastructure, Bell Atlantic
   originally assessed approximately 73% as compliant or to be retired. As of
   July 31, 1999, Bell Atlantic has successfully completed
   remediation/replacement of all mission critical elements.

   Bell Atlantic's project to remediate/replace or retire mission critical
systems supporting buildings and other facilities used by its operating
telephone subsidiaries, such as HVAC, access control and alarm systems, is now
complete and its efforts to remediate/replace or retire any other Bell Atlantic
mission critical system used by those subsidiaries are virtually complete, with
only a small number of such systems still requiring attention. Work on these few
miscellaneous systems is expected to be completed by the end of September.
Remediation/replacement or retirement of non-mission critical systems, where
applicable, and supplemental testing and verification/correction activities, for
both mission critical and non-mission critical systems, are likely to continue
throughout the balance of 1999.


   Third Party Issues

   .  Vendors

      In general, Bell Atlantic's product vendors have made available either
      Year 2000-compliant versions of their offerings or new compliant products
      as replacements of discontinued offerings. The compliance "status" of a
      given product is typically determined using multiple sources of
      information, including Bell Atlantic's own internal testing and analysis.
      However, in some instances certification is based on detailed test results
      or similar information provided by the product vendor and analysis by Bell
      Atlantic or contractors specializing in this type of review. Bell Atlantic
      is also continuing Year 2000-related discussions with utilities and
      similar services providers. Although Bell Atlantic has received assurances
      and other information suggesting that substantially all of its primary
      services providers have completed or are well along in their respective
      Year 2000 projects, Bell Atlantic does not usually have sufficient access
      to or control over the providers' systems and equipment to undertake
      verification efforts as to such systems and equipment, and as a general
      matter, it would be impractical to do so. Bell Atlantic has also
      participated in interoperability testing of various mission critical
      network elements, purchased from a number of vendors, through the Telco
      Year 2000 Forum, an industry group comprised of leading local
      telecommunications services companies. Bell Atlantic intends to monitor
      critical service provider activities, as appropriate, through the
      completion of their respective remediation projects.

   .  Customers

      Bell Atlantic's customers remain keenly interested in the progress of its
      Year 2000 efforts, and it anticipates increased demand for information,
      including detailed testing data and company-specific responses. Bell
      Atlantic is providing limited warranties of Year 2000 compliance for
      certain new telecommunications services and other offerings, but it does
      not expect any resulting warranty costs to be material.

   .  Interconnecting Carriers

      Bell Atlantic's network operations interconnect with domestic and
      international networks of other carriers. If one of these interconnecting
      carrier networks should fail or suffer adverse impact from a Year 2000
      problem, Bell Atlantic's customers could experience impairment of service.
      Bell Atlantic has participated in various internetworking testing efforts,
      as a

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   member of the Association for Telecommunications Industry Solutions (ATIS),
   the Cellular Telecommunications Industry Association (CTIA) and the
   International Telecommunications Union (ITU). Bell Atlantic intends to
   monitor the activities of the primary interconnecting carriers through the
   completion of their respective remediation projects.

Costs

   From the inception of Bell Atlantic's Year 2000 project through June 30,
1999, and based on the cost tracking methods it has historically applied to this
project, Bell Atlantic has incurred total pre-tax expenses of approximately $180
million, and it has made capital expenditures of approximately $116 million. For
1999, Bell Atlantic expects to incur total pre-tax expenses for its Year 2000
project of approximately $75 million to $150 million (approximately $58 million
of which was incurred through June 30, 1999) and total capital expenditures of
$75 million to $125 million (approximately $36 million of which was incurred
through June 30, 1999). Bell Atlantic anticipates that the balance of the costs
incurred for 1999 will be primarily attributable to additional testing and
verification/correction, rollover transition management, contingency planning
and repair/replacement of non-mission critical systems. These cost estimates
should not be used as the sole gauge of progress on its Year 2000 project or as
an indication of Year 2000 readiness.

Risks

   The failure to correct a material Year 2000 problem could cause an
interruption or failure of certain of Bell Atlantic's normal business functions
or operations, which could have a material adverse effect on its results of
operations, liquidity or financial condition; however, it considers such a
likelihood remote. Due to the uncertainty inherent in other Year 2000 issues
that are ultimately beyond Bell Atlantic's control, including, for example, the
final Year 2000 readiness of its suppliers, customers, interconnecting carriers,
and joint venture and investment interests, it is unable to determine at this
time the likelihood of a material impact on its results of operations, liquidity
or financial condition due to such Year 2000 issues. However, Bell Atlantic is
taking appropriate prudent measures to mitigate that risk. Bell Atlantic
anticipates that, in the event of material interruption or failure of its
service resulting from an actual or perceived Year 2000 problem within or beyond
its control, it could be subject to third party claims.

Contingency Plans

   As a public telecommunications carrier, Bell Atlantic has had considerable
experience successfully dealing with natural disasters and other events
requiring contingency planning and execution. Bell Atlantic's Year 2000
contingency plans are built upon its existing Emergency Preparedness and
Disaster Recovery plans.

   Bell Atlantic will continue to fine-tune and test its corporate Year 2000
contingency plans to help ensure that core business functions and key support
processes will continue to function without material disruption, in the event of
external (e.g. power, public transportation, water), internal or supply chain
failures (i.e. critical dependencies on another entity for information, data or
services). Bell Atlantic's individual business unit contingency plans for Year
2000 are being integrated and coordinated under an enterprise wide command and
control structure.

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                          PART II - OTHER INFORMATION


Item 6.   Exhibits and Reports on Form 8-K


          (a)  Exhibits:

               Exhibit Number

               27 Financial Data Schedule


          (b)  There were no Current Reports on Form 8-K filed during the
               quarter ended June 30, 1999.

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                                   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.



                                         BELL ATLANTIC - MARYLAND, INC.


Date:  August 11, 1999                   By  /s/ Edwin F. Hall
                                            --------------------------------
                                                 Edwin F. Hall
                                                 Controller



      UNLESS OTHERWISE INDICATED, ALL INFORMATION IS AS OF AUGUST 6, 1999.

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