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 June 30, 2008

                                       or

    [   ]  Transition Report Pursuant to Section 13 or 15(d) of the
                     Securities Exchange Act of 1934

                          Commission file number 1-7265


                               AMBASE CORPORATION


             (Exact name of registrant as specified in its charter)

        Delaware                                          95-2962743

  (State of incorporation)                (I.R.S. Employer Identification No.)

                           100 PUTNAM GREEN, 3RD FLOOR
                          GREENWICH, CONNECTICUT 06830

            (Address of principal executive offices)     (Zip Code)

                                 (203) 532-2000

              (Registrant's telephone number, including area code)


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

YES     X        NO  ______
     -------

     Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated  filer, a non-accelerated  filer, or a smaller reporting company.
See definition of "large accelerated filer",  "accelerated  filer", and "smaller
reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated Filer  Accelerated Filer  Non-Accelerated Filer X
Smaller Reporting Company

     Indicate  by check mark  whether  the  registrant  is a shell  company  (as
defined in Rule 12b-2 of the Exchange Act).

YES              NO     X
     -------         -------------

     At  July  17,  2008,  there  were  43,599,164  shares  outstanding  of  the
registrant's common stock, $0.01 par value per share.
<PAGE>
AmBase Corporation

Quarterly Report on Form 10-Q
June 30, 2008
<TABLE>
<CAPTION>
<S>      <C>                                                                                                  <C>

TABLE OF CONTENTS                                                                                             Page
                                                                                                             ------

PART I - FINANCIAL INFORMATION

Item 1.      Financial Statements (unaudited).....................................................................1

Item 2.      Management's Discussion and Analysis of

                   Financial Condition and Results of Operations.................................................15

Item 3.      Quantitative and Qualitative Disclosures About Market Risk..........................................17

Item 4T.     Controls and Procedures.............................................................................18

PART II - OTHER INFORMATION

Item 1.      Legal Proceedings...................................................................................19

Item 1A.     Risk Factors........................................................................................19

Item 2.      Unregistered Sales of Equity Securities and Use of Proceeds.........................................19

Item 3.      Defaults Upon Senior Securities.....................................................................19

Item 4.      Submission of Matters to a Vote of Security Holders.................................................19

Item 5.      Other Information...................................................................................20

Item 6.      Exhibits............................................................................................20

Signatures   ....................................................................................................20
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

PART I - FINANCIAL INFORMATION
Item 1.  FINANCIAL STATEMENTS

                       AMBASE CORPORATION AND SUBSIDIARIES
                           Consolidated Balance Sheets
                                   (Unaudited)
                (in thousands, except for share and per share amounts)
<S>                                                                                    <C>            <C>
                                                                                       June 30,       December 31,
                                                                                           2008               2007
                                                                                       ========          =========
Assets:

Cash and cash equivalents.........................................................    $   3,822         $    2,894

Investment securities:

    Held to maturity (market value $11,716 and $16,329, respectively).............       11,722             16,313
                                                                                      ---------         ----------
Total investment securities.......................................................       11,722             16,313
                                                                                      ---------         ----------
Real estate owned:
  Land............................................................................          554                554
  Buildings and improvements......................................................        1,900              1,900
                                                                                      ---------         ----------
                                                                                          2,454              2,454
  Less:  accumulated depreciation.................................................         (360)              (334)
                                                                                      ---------         ----------
Real estate owned, net............................................................        2,094              2,120
Other assets......................................................................          319                232
                                                                                      ---------         ----------
Total assets......................................................................    $  17,957         $   21,559
                                                                                      =========         ==========
Liabilities and Stockholders' Equity:
Liabilities:

Accounts payable and accrued liabilities..........................................    $     910         $      962
Other liabilities.................................................................           14                 19
                                                                                      ---------         ----------
Total liabilities.................................................................          924                981
                                                                                      ---------         ----------
Commitments and contingencies (Note 3)............................................            -                  -

Stockholders' equity:
Common stock ($0.01 par value, 200,000,000 authorized, 46,410,007 issued and
   43,599,164 outstanding in 2008 and 43,858,664 outstanding in 2007).............          464                464
Paid-in capital...................................................................      548,044            548,044
Accumulated deficit...............................................................     (529,495)          (526,057)
Treasury stock, at cost - 2,810,843 and 2,551,343 shares, respectively............       (1,980)            (1,873)
                                                                                      ---------         ----------
Total stockholders' equity........................................................       17,033             20,578
                                                                                      ---------         ----------
Total liabilities and stockholders' equity........................................    $  17,957         $   21,559
                                                                                      =========         ==========
</TABLE>

     The accompanying notes are an integral part of these consolidated financial
statements.


<PAGE>
<TABLE>
<CAPTION>


                       AMBASE CORPORATION AND SUBSIDIARIES
                      Consolidated Statements of Operations
                   Second Quarter and Six Months Ended June 30
                                   (Unaudited)
                      (in thousands, except per share data)
<S>                                                                    <C>            <C>            <C>          <C>
                                                                         Second Quarter                 Six Months
                                                                       2008           2007           2008         2007
                                                                       ====           ====           ====         ====
Operating expenses:

Compensation and benefits.........................................   $    449       $   1,116    $     949    $   2,248
Professional and outside services.................................        906             909        2,773        1,373
Property operating and maintenance................................         26              29           48           52
Depreciation  ....................................................         13              13           26           26
Insurance.........................................................         26              25           44           44
Other operating...................................................         41              60           92           98
                                                                     --------       ---------    ---------    ---------
                                                                        1,461           2,152        3,932        3,841
                                                                     --------       ---------    ---------    ---------
Operating loss....................................................     (1,461)         (2,152)      (3,932)      (3,841)
                                                                     --------       ---------    ---------    ---------
Interest income...................................................         94             394          247          859
Realized gains on sales of investment securities..................          -             128            -          284
Other income......................................................        247               -          247            -
                                                                     --------       ---------    ---------    ---------
Loss before income taxes..........................................     (1,120)         (1,630)      (3,438)      (2,698)
Income tax expense................................................          -             (25)           -          (50)
                                                                      -------       ---------    ---------    ---------
Net loss..........................................................     (1,120)      $  (1,655)   $  (3,438)   $  (2,748)
                                                                      =======       =========    =========    =========
Net loss per common share:
Net loss - basic..................................................    $ (0.03)      $   (0.03)   $   (0.08)   $   (0.06)
                                                                      =======       =========    =========    =========
Net loss - assuming dilution......................................    $ (0.03)      $   (0.03)   $   (0.08)   $   (0.06)
                                                                      =======       =========    =========    =========
Weighted average common shares outstanding:
Basic.............................................................     43,610          44,864       43,669       44,916
                                                                      =======       =========    =========    =========
Diluted...........................................................     43,610          44,864       43,669       44,916
                                                                      =======       =========    =========    =========
</TABLE>
     The accompanying notes are an integral part of these consolidated financial
statements.

<PAGE>
<TABLE>
<CAPTION>
                       AMBASE CORPORATION AND SUBSIDIARIES
             Consolidated Statements of Comprehensive Income (Loss)
                   Second Quarter and Six Months Ended June 30
                                   (Unaudited)
                                 (in thousands)
<S>                                                                        <C>       <C>             <C>        <C>
                                                                           Second Quarter               Six Months
                                                                           2008      2007            2008        2007
                                                                           =====     =====           =====       =====
Net loss............................................................     $(1,120)  $(1,655)       $ (3,438)   $ (2,748)

Amortization of minimum pension liability adjustment................           -       190               -         474

Unrealized holding losses on investment securities
     available for sale.............................................           -      (111)              -        (111)
                                                                         -------   -------        --------    --------
Comprehensive loss...................................................    $(1,120)  $(1,576)       $ (3,438)   $ (2,385)
                                                                         =======   =======        ========    =======
</TABLE>

     The accompanying notes are an integral part of these consolidated financial
statements.

<PAGE>
<TABLE>
<CAPTION>
                       AMBASE CORPORATION AND SUBSIDIARIES
                      Consolidated Statements of Cash Flows
                            Six Months Ended June 30
                                   (Unaudited)
                                 (in thousands)
<S>                                                                                        <C>           <C>
                                                                                           2008          2007
                                                                                           ====          ====
Cash flows from operating activities:
Net loss........................................................................      $  (3,438)    $   (2,748)
Adjustments to reconcile net loss to net cash used by
       operations:
    Depreciation and amortization...............................................             26             26
    Accretion of discount - investment securities...............................              -            (34)
     Realized gains on sales of investment securities...........................              -           (284)
    Amortization of minimum pension liability adjustment........................              -            474
Changes in other assets and liabilities:
    Accrued interest receivable in investment securities........................            116            104
    Other assets................................................................            (87)         1,164
    Accounts payable and accrued liabilities....................................            (52)          (328)
    Supplemental retirement plan and other liabilities..........................             (5)           389
    Payment of Supplemental Plan lump-sum benefit...............................              -        (16,676)
                                                                                       ---------     ----------
Net cash used by operating activities...........................................         (3,440)       (17,913)
                                                                                      ---------     ----------
Cash flows from investing activities:
Maturities of investment securities - held to maturity..........................         25,338         41,832
Purchases of investment securities - held to maturity...........................        (20,863)       (24,683)
Sales of investment securities - available for sale.............................              -          1,344
Purchases of investment securities - available for sale.........................              -            (31)
                                                                                      ---------     ----------
Net cash provided by investing activities.......................................          4,475         18,462
                                                                                      ---------     ----------
Cash flows from financing activities:
Common stock repurchased........................................................           (107)          (100)
                                                                                      ---------     ----------
Net cash used by financing activities...........................................           (107)          (100)
                                                                                      ---------     ----------
Net change in cash and cash equivalents.........................................            928            449
Cash and cash equivalents at beginning of period................................          2,894          2,601
                                                                                      ---------     ----------
Cash and cash equivalents at end of period......................................      $   3,822     $    3,050
                                                                                      =========     ==========
Supplemental cash flow disclosures:
Income taxes paid...............................................................      $       1     $       82
                                                                                      =========     ==========
</TABLE>
     The accompanying notes are an integral part of these consolidated financial
statements.


<PAGE>
                       AMBASE CORPORATION AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements

Note 1 - Organization

     The accompanying  consolidated  financial  statements of AmBase Corporation
and its wholly-owned  subsidiaries  (the "Company") are unaudited and subject to
year-end adjustments.  All material intercompany  transactions and balances have
been eliminated. In the opinion of management,  the interim financial statements
reflect all adjustments,  consisting only of normal recurring adjustments unless
otherwise  disclosed,  necessary  for  a  fair  presentation  of  the  Company's
financial  position,  results of operations and cash flows.  Results for interim
periods  are not  necessarily  indicative  of  results  for the full  year.  The
consolidated   financial  statements  have  been  prepared  in  accordance  with
accounting  principles  generally  accepted  in the  United  States  of  America
("GAAP") for interim  financial  information  and with the  instructions to Form
10-Q and Article 10 of Regulation S-X. The  preparation of financial  statements
in conformity with GAAP requires  management to make estimates and  assumptions,
that it deems  reasonable,  that  affect  the  reported  amounts  of assets  and
liabilities  and disclosure of contingent  assets and liabilities at the date of
the  financial  statements  and the  reported  amounts of revenues  and expenses
during the reporting period. Actual results could differ from such estimates and
assumptions.  The unaudited  interim financial  statements  presented herein are
condensed  and should be read in  conjunction  with the  Company's  consolidated
financial  statements filed in its Annual Report on Form 10-K for the year ended
December 31, 2007.

     The  Company's  assets  currently   consist  primarily  of  cash  and  cash
equivalents, investment securities, and real estate owned. The Company currently
earns  non-operating  revenue  principally  consisting of earnings on investment
securities and cash  equivalents.  The Company continues to evaluate a number of
possible  acquisitions,  and is  engaged  in the  management  of its  assets and
liabilities,  including the contingent assets, as described in Part II - Item 1.
From time to time, the Company and its  subsidiaries may be named as a defendant
in various lawsuits or proceedings.  The Company intends to aggressively contest
all   litigation  and   contingencies,   as  well  as  pursue  all  sources  for
contributions to settlements.

     The Company's  management  believes that  operating cash needs for the next
twelve months will be met  principally  by the receipt of earnings on investment
securities and cash equivalents, and the Company's current financial resources.

Note 2 - Recent Accounting Pronouncements

     In September 2006, the Financial  Accounting Standard Board ("FASB") issued
SFAS No. 157,  "Fair Value  Measurements"  ("SFAS  157").  SFAS 157 defines fair
values,  establishes  a  framework  for  measuring  fair  value  of  assets  and
liabilities,  and  expands  disclosure  requirements  regarding  the fair  value
measurement.  SFAS 157 does not expand the use of fair value measurements.  This
statement,  as issued,  is effective for financial  statements issued for fiscal
years beginning after November 15, 2007, and interim periods within those fiscal
years.  FASB Staff  Position (FSP) FAS No. 157-2 was issued in February 2008 and
deferred the effective date of SFAS 157 for nonfinancial  assets and liabilities
to fiscal years beginning after November 2008. As such, the Company adopted SFAS
157 as of January 1, 2008 for financial  assets and liabilities  only. There was
no  significant  effect on the Company's  financial  statements.  As of June 30,
2008, the Company's financial assets include held to maturity  investments.  The
Company  determines  fair  value for such  investments,  based on quoted  market
prices in active  markets (i.e.  Level 1 as defined under SFAS 157). The Company
is continuing to carry such  investments at amortized cost. The Company does not
believe that the adoption of SFAS 157 to  non-financial  assets and  liabilities
will significantly effect its financial statements.

     In February  2007,  the FASB issued  SFAS 159,  "The Fair Value  Option for
Financial  Assets and Liabilities - including an amendment of FASB Statement No.
115" ("SFAS 159").  SFAS 159 expands the use of fair value  accounting  but does
not affect existing standards which requires assets or liabilities to be carried
at fair value.  The objective of SFAS 159 is to improve  financial  reporting by
providing  companies  with the  opportunity  to mitigate  volatility in reported
earnings caused by measuring related assets and liabilities  differently without
having to apply complex hedge accounting  provisions.  Under SFAS 159, a company
may elect to use fair  value to measure  eligible  items at  specified  election
dates and report  unrealized  gains and losses on items for which the fair value
option has been elected in earnings at each subsequent  reporting date. Eligible
items include,  but are limited to, accounts  receivable,  accounts payable, and
issued debt. If elected,  SFAS 159 is effective for fiscal years beginning after
November 15, 2007. The Company has not elected to measure any additional  assets
or liabilities  at fair value that are not already  measured at fair value under
existing standards.

<PAGE>
                       AMBASE CORPORATION AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements

     In December  2007,  the FASB issued SFAS No. 141 (revised  2007,  "Business
Combinations"   ("SFAS  141(R)").   SFAS  141(R)   establishes   principles  and
requirements  for how an  acquirer  recognizes  and  measures  in its  financial
statements the  identifiable  assets  acquired,  the  liabilities  assumed,  any
non-controlling  interest in the acquiree and the goodwill acquired. SFAS 141(R)
also establishes disclosure  requirements to enable the evaluation of the nature
and financial effects of the business combination.  SFAS 141(R) is effective for
fiscal years  beginning  after  December  15,  2008.  The Company will apply the
provisions of SFAS 141(R) to any acquisition after January 1, 2009.

     In  December  2007,  the  FASB  issued  SFAS  No.  160,   "Accounting   for
Noncontrolling Interests" ("SFAS 160"). SFAS 160 clarifies the classification of
noncontrolling   interests  in   consolidated   balance   sheets  and  reporting
transactions   between  the  reporting  entity  and  holders  of  noncontrolling
interests. Under this statement,  noncontrolling interests are considered equity
and  reported  as  an  element  of  consolidated  equity.  Further,  net  income
encompasses all consolidated  subsidiaries with disclosure of the attribution of
net income between  controlling and  noncontrolling  interests.  SFAS No. 160 is
effective  prospectively  for fiscal years  beginning  after  December 15, 2008.
Currently,  there  are no  noncontrolling  interests  in  any  of the  Company's
subsidiaries.

Note 3 - Legal Proceedings

     The  information  contained  in  Item 8 - Note 10 in the  Company's  Annual
Report on Form 10-K for the year ended  December 31, 2007,  is  incorporated  by
reference  herein and the defined  terms set forth  below have the same  meaning
ascribed to them in that  report.  There have been no material  developments  in
such legal proceedings, except as set forth below.

     The Company is or has been a party in a number of lawsuits or  proceedings,
including the following:

     Supervisory Goodwill Litigation -

     Pursuant to the Court's post-trial  scheduling order as revised, on July 1,
2008, the Company filed its post-trial brief and proposed  findings of fact. The
FDIC also filed its  post-trial  brief on July 1, 2008.  Post-trial  briefing is
currently  scheduled  to be concluded  by November  2008.  The Court has not yet
established  a date for the  parties'  presentation  of closing  arguments.  The
Company believes any decision rendered by Judge Smith on damages, as well as his
decision  relating to his  authority  to review and consider the validity of the
alleged  receivership  deficit,  will likely be  appealed  to the U.S.  Court of
Appeals for the Federal Circuit.

     Both the Court of Federal  Claims and the Court of Appeals  for the Federal
Circuit have issued numerous  decisions in cases that involve claims against the
United  States  based upon its breach of its  contracts  with  savings  and loan
institutions  through its 1989 enactment of FIRREA.  In particular,  the Federal
Circuit  has issued  decisions  rejecting  Takings  Clause  claims  advanced  by
shareholders of failed thrifts. See e.g., Castle v. United States,  301F.3d 1328
(Fed.  Cir. 2002);  Bailey v. United States,  341 F. 3d 1342 (Fed. Cir 2003). In
June 2004,  the United States  Supreme Court denied the petition for  certiorari
filed by Bailey.  The Court of Federal Claims  decisions and certain  filings in
the Company's  case, as well as other  decisions in Winstar  related cases,  are
publicly    available   on   the   Court   of   Federal    Claims   website   at
www.cofc.uscourts.gov. In addition, decisions in Winstar related cases that have
been issued by the U.S.  Court of  Appeals,  the court that hears  appeals  from
decisions  by the  Court of  Claims,  may be found on that  court's  website  at
www.cafc.uscourts.gov.  Decisions in other Winstar related cases may be relevant
to the Company's Supervisory Goodwill claims, but are not necessarily indicative
of the  ultimate  outcome of the  Company's  actions.  The  Company  can give no
assurances regarding the ultimate outcome of the litigation.

<PAGE>
                       AMBASE CORPORATION AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements

Note 4 - Cash and Cash Equivalents

     Highly  liquid  investments,   consisting  principally  of  funds  held  in
short-term  money market  accounts with  original  maturities of less than three
months, are classified as cash equivalents.

Note 5 - Investment Securities

     Investment  securities - held to maturity,  consist of U.S.  Treasury Bills
with  original  maturities  over three months and are carried at amortized  cost
(which includes accrued interest) based upon the Company's intent and ability to
hold these investments to maturity.

Investment securities consist of the following:
<TABLE>
<CAPTION>

                                             June 30, 2008                                  December 31, 2007
                              =====================================           ======================================
<S>                           <C>            <C>            <C>               <C>           <C>                <C>
                                               Cost or                                        Cost or
                              Carrying       Amortized         Fair           Carrying      Amortized           Fair
(in thousands)                   Value            Cost        Value              Value           Cost          Value
                              ========       =========       ======           ========      =========          =====
Held to Maturity:
U.S. Treasury Bills........   $ 11,722       $  11,722    $  11,716           $ 16,313      $  16,313       $ 16,329
                              ========       =========    =========           ========      =========       ========
</TABLE>
     The gross unrealized gains (losses) on investment  securities,  at June 30,
2008 and December 31, 2007 consist of the following:
<TABLE>
<S>                                                                                              <C>           <C>
(in  thousands)                                                                                  2008          2007
                                                                                             ========      ========
Held to Maturity:.
Gross unrealized gains..................................................................     $      -      $     17
                                                                                             ========      ========
Gross unrealized losses.................................................................     $     (6)     $     (1)
                                                                                             ========      ========
</TABLE>
<PAGE>
                       AMBASE CORPORATION AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements

     Realized gains on the sales of investment securities available for sale for
the second quarter and six months ended June 30 as follows:
<TABLE>
<S>                                                                                    <C>                  <C>
                                                                                       Second Quarter       Six Months
(in thousands)                                                                              2007               2007
                                                                                       ==============       ==========

Net sale proceeds.......................................................................  $     574         $    1,344
Cost basis..............................................................................       (446)            (1,060)
                                                                                       ------------         ----------
Realized gains.........................................................................   $     128         $      284
                                                                                       ============         ==========
</TABLE>
     No investment  securities  were sold during the second quarter or six month
periods ended June 30, 2008.

Note 6 - Property Owned

     The Company owns one commercial  office building in Greenwich,  Connecticut
that  contains   approximately   14,500  square  feet.   The  Company   utilizes
approximately  3,500 square feet for its executive offices;  the remaining space
is currently unoccupied and available for lease.

     Although the portion of the  building not being  utilized by the Company is
currently  unoccupied and available for lease, based on the Company's  analysis,
including but not limited to current market rents in the area,  leasing  values,
and comparable  property sales,  the Company believes the property's fair market
value exceeds the property's  current  carrying value.  Therefore,  the carrying
value of the property as of June 30, 2008, has not been impaired.

     Depreciation  expense for buildings is calculated on a straight-line  basis
over 39 years. Tenant improvements,  if any, would typically be depreciated over
the lesser of the remaining life of the tenants'  lease or the estimated  useful
lives of the improvements.

Note 7 - Income Taxes

     The Company and its 100% owned  domestic  subsidiaries  file a consolidated
federal income tax return.  The Company recognizes both the current and deferred
tax consequences of all transactions  that have been recognized in the financial
statements,  calculated  based on the provisions of enacted tax laws,  including
the tax rates in effect for current and future  years.  Net  deferred tax assets
are  recognized  immediately  when a more likely than not criterion is met; that
is, greater than 50%  probability  exists that the tax benefits will actually be
realized sometime in the future.

     The Company has  calculated  a net  deferred tax asset of $32 million as of
June 30, 2008 and December 31, 2007,  arising  primarily from net operating loss
("NOL")  carryforwards,  alternative  minimum tax ("AMT") credits (not including
the anticipated tax effects of NOL's which could be generated from the Company's
tax  basis  in  Carteret  Savings  Bank,  F.A.  and  subsidiaries  ("Carteret"),
resulting  from  the  election  decision,  as more  fully  described  below).  A
valuation  allowance has been  established for the entire net deferred tax asset
as management, at the current time, has no basis to conclude that realization is
more likely than not.

     There were no  unrecognized  tax  benefits at December 31, 2007 or June 30,
2008.  Further,  no significant  changes in unrecognized income tax benefits are
currently  expected  to occur  over the next  year.  Interest  and/or  penalties
related to  underpayments  of income taxes, if applicable,  would be included in
interest  expense  and  operating  expenses,   respectively.   The  accompanying
financial  statements  do not include any amounts for any such  interest  and/or
penalties.  The Company's federal income tax returns for the years subsequent to
1992 have not been  reviewed by the Internal  Revenue  Service  ("IRS") or state
authorities and the Company has not been notified of any potential tax audits by
any federal,  state or local tax authorities.  As such, the Company believes the
statute of limitations  for federal and state purposes are generally  closed for
tax years prior to 2004.

<PAGE>
                       AMBASE CORPORATION AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements

     Based upon the Company's  federal  income tax returns as filed from 1993 to
2006 (subject to IRS audit adjustments),  excluding all effects of the inclusion
of  Carteret/Carteret  FSB from December 4, 1992 forward as noted herein,  as of
June 30, 2008, the Company has NOL carryforwards  aggregating  approximately $33
million,  available  to reduce  future  federal  taxable  income which expire if
unused beginning in 2009.

     The utilization of certain  carryforwards  is subject to limitations  under
U.S.  federal income tax laws. In addition,  the Company has  approximately  $21
million of AMT credit  carryforwards  ("AMT Credits"),  which are not subject to
expiration.  Based on the filing of the Carryback Claims, as defined and further
discussed below,  the Company is seeking to realize  approximately $8 million of
the $21 million of AMT Credits.

     As a  result  of the  Office  of  Thrift  Supervision's  December  4,  1992
placement of Carteret in  receivership,  under the  management of the Resolution
Trust Corporation  ("RTC")/Federal  Deposit Insurance Corporation ("FDIC"),  and
then proposed Treasury Reg. ss.1.597-4(g),  the Company had previously filed its
1992 and subsequent federal income tax returns with Carteret  disaffiliated from
the Company's  consolidated  federal income tax return. Based upon the impact of
Treasury  Reg.  ss.1.597-4(g),  which was issued in final form on  December  20,
1995, a continuing review of the Company's tax basis in Carteret, and the impact
of prior year tax return  adjustments  on the Company's  1992 federal income tax
return as filed,  the Company decided not to make an election  pursuant to final
Treasury  Reg.   ss.1.597-4(g)  to  disaffiliate  Carteret  from  the  Company's
consolidated  federal  income tax return  effective  as of December 4, 1992 (the
"Election Decision").

     The Company has made numerous  requests to the RTC/FDIC for tax information
pertaining to Carteret and the resulting successor institution, Carteret Federal
Savings Bank ("Carteret  FSB");  however,  all of the information  still has not
been received.  The Company believes, as a result of remaining consolidated with
Carteret FSB for federal  income tax return  purposes,  that the  Company's  tax
basis in  Carteret/Carteret  FSB can be  converted  into  NOL's  which  could be
available  to  carryforward/carryback  into  various  federal  income tax return
years.  However;  since all of the  Carteret  FSB tax  information  has not been
received,  the Company is unable to determine with  certainty,  the amount of or
the  years  in  which  any  NOL's  may  ultimately  be  generated;  if  the  NOL
carryforwards/carrybacks  will be  utilized in prior  federal  income tax return
years; or the final expiration dates of any of the NOL  carryforwards/carrybacks
ultimately generated.

     Based on information  received to date, and prior to the recognition of the
1992 tax losses  expected to be generated as a result of amending the  Company's
1992  federal  income  tax  return,  as further  described  below,  the  Company
estimated  that as of December  1992 it initially  had a remaining  tax basis in
Carteret/Carteret FSB of approximately $158 million.

     Based on the Company's Election Decision,  described above, and the receipt
of some of the requested information from the RTC/FDIC,  the Company amended its
1992  consolidated  federal  income tax return to include the federal income tax
effects of Carteret and Carteret FSB, (the "1992  Amended  Return").  As part of
the 1992  Amended  Return,  approximately  $56  million,  (of the  initial  $158
million),  of  Carteret/Carteret  FSB tax basis is expected to be converted into
NOL  carryforwards  in tax year 1992 and will have expired in 2007,  unless they
are  absorbed  in earlier  years  based on  inclusion  of  certain  items in the
consolidated  group.  The  Company  is still in the  process  of  reviewing  its
consolidated federal income tax returns for 1993 and subsequent years.

     The  Carteret/Carteret  FSB  tax  basis,  of  approximately  $102  million,
remaining after  recognition of the 1992 Amended  Return,  may be converted into
NOL   carryforwards/carrybacks   as  additional  tax  losses  are  generated  by
Carteret/Carteret  FSB and may be carried  back or carried  forward to other tax
years;  utilized in other tax years; or could begin to expire in 2008 based upon
the year any NOL's are ultimately generated.  The Company can give no assurances
with regard to the 1992 Amended Return,  subsequent  year returns,  or the final
amount or expiration of NOL  carryforwards/carrybacks  ultimately generated,  if
any, from the Company's tax basis in Carteret/Carteret FSB.

     Any  NOL's   ultimately   generated   from  the   Company's  tax  basis  in
Carteret/Carteret FSB, would be in addition to the NOL  carryforwards/carrybacks
generated based on the Company's federal income tax returns as previously filed,
as further detailed above.

<PAGE>
                       AMBASE CORPORATION AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements

     In March 2000, the Company filed several carryback claims and amendments to
previously filed carryback claims with the IRS (the "Carryback  Claims") seeking
refunds from the IRS of  alternative  minimum tax and other federal income taxes
paid by the Company in prior years plus  applicable  IRS interest,  based on the
filing of the 1992 Amended Return.  In April 2003, IRS examiners issued a letter
to the Company  proposing to disallow the Carryback  Claims.  The Company sought
administrative review of the letter by protesting to the Appeals Division of the
IRS. In February  2005,  IRS Appeals  officials  completed  their  review of the
Carryback Claims, and disallowed them. On April 29, 2008, the Company filed suit
in the U.S.  District Court for the District of Connecticut  for the tax refunds
it seeks, plus interest,  with respect to the Carryback Claims. On July 1, 2008,
the IRS filed its answer to the Company's complaint, denying the allegations set
forth in the  complaint.  The  Company  can give no  assurances  as to the final
amounts of  refunds,  if any, or when they might be received as a result of this
tax refund suit.

     The FDIC has previously  filed a federal income tax return for Carteret FSB
for 1995 (as well as other years),  which  indicates that Carteret FSB allegedly
could owe a 1995 federal  income tax liability of $32 million,  which  including
interest and penalty thereon,  could be in excess of $110 million.  The FDIC has
stated to the United States Court of Federal Claims ("Court of Claims") that the
tax amounts are only estimates and are highly  contingent.  Based on proceedings
in other  Supervisory  Goodwill  cases,  it is possible  that the IRS may try to
collect the alleged  Carteret  FSB federal  income  taxes from the  Carteret FSB
receivership.

     The Company  believes the Carteret FSB federal  income tax returns filed by
the FDIC were  improperly  filed and are neither  accurate nor valid. As part of
the Supervisory  Goodwill legal proceedings,  the Company presented to the Court
of Claims  various  arguments to support the position that no federal income tax
would be owed as a result of the Carteret FSB  receivership  operations  for tax
year 1995,  or any other tax year;  however,  the  Department of Justice and the
FDIC have  stated to the Court of Claims  that they do not  believe the Court of
Claims has jurisdiction  over that issue. The Supervisory  Goodwill  proceedings
remain pending in the Court of Claims.

     Based on the  information  received to date,  if the correct  Carteret  FSB
federal  income tax results were included with the  Company's  originally  filed
federal income tax returns, the Company,  based upon consultation with its legal
and tax advisors,  believes that no additional material federal income tax would
be owed by the Company for tax year 1995 (or any other tax year),  although this
can not be assured based on the information  currently available.  This analysis
included  among other items,  a review of the  Carteret  FSB federal  income tax
returns as prepared by the FDIC and the correction of errors originally reported
therein, the proper application of federal NOL carryforwards and carrybacks, and
the adherence to provisions  contained in the Internal Revenue Code, as amended.
The Company;  however,  can give no assurances of the final amounts,  if any, of
federal income taxes owed by the Carteret FSB  receivership or by the Company as
a result of the Carteret FSB receivership operations.

     The Company is  continuing  to attempt to resolve  these matters as part of
the  Supervisory  Goodwill  legal  process and is also  continuing to review the
Carteret FSB federal income tax returns and the results of their  inclusion with
the Company's  federal  income tax returns as previously  filed.  The Company is
also pursuing the Carryback Claims, as further described above, which could have
an impact  on the  analysis  of the  prior  year tax  information.  For  further
information on the Supervisory Goodwill legal proceedings, see Note 3 herein.

     The  discussion of the Carteret FSB federal  income tax results is intended
to provide  details as to the potential  inter-relationship  of the Carteret FSB
federal income tax returns with the Company's  federal income tax positions.  It
is not a reflection of any federal  income tax liability of the Company  arising
from the Carteret receivership operations.

     In June 2008, the Company recorded other income of $247,000 attributable to
an IRS interest  refund,  consented to by the IRS in June 2008,  and received by
the Company in July 2008.  The refund  resulted  from the  Company's  pursuit of
interest  refund claims for several  prior tax years under a tax code  provision
which allowed for the retroactive recovery of the interest  differential where a
taxpayer had a tax  underpayment  (subject to higher interest payment rates) for
one tax year and a  simultaneous  tax  overpayment  (subject  to lower  interest
refund rates) for another tax year.

<PAGE>
                       AMBASE CORPORATION AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements

Note 8 - Comprehensive Income (Loss)

     Comprehensive income (loss) is composed of net loss and other comprehensive
income  (loss)  which  includes  the  change in  unrealized  gains  (losses)  on
investment  securities  available for sale and recognition  and  amortization of
additional minimum pension liability, as follows:

<TABLE>
<S>                            <C>          <C>              <C>             <C>          <C>             <C>
                                           Second Quarter Ended                          Six Months Ended
(in thousands)                                June 30, 2007                                June 30, 2007
                               ===========================================   ==========================================
                               Minimum      Unrealized       Accumulated     Minimum      Unrealized      Accumulated
                               Pension      Gains (Losses)   Other           Pension      Gains (Losses)  Other
                               Liability    on Investment    Comprehensive   Liability    on Investments  Comprehensive
                               Adjustment   Securities       Income (Loss)   Adjustment   Securities      Income (Loss)
                               ==========   =============    =============   ==========   ==============  =============
Balance beginning of period....$    (190)   $        138     $        (52)   $    (474)   $         138   $       (336)

Reclassification adjustment for
  gains realized in net loss...        -            (117)            (117)           -             (184)          (184)

Change during the period.......      190               6              196          474               73            547
                               ----------   -------------    -------------   ----------   --------------  -------------
Balance end of period..........$       -    $         27     $         27    $       -    $          27   $         27
                               ==========   =============    ==== ========   ==========   ==============  =============
</TABLE>

Note 9 - Stock-Based Compensation

     Under the  Company's  1993  Stock  Incentive  Plan (the "1993  Plan"),  the
Company may grant to officers and employees of the Company and its subsidiaries,
stock options ("Options"),  stock appreciation rights ("SARs"), restricted stock
awards ("Restricted Stock"), merit awards ("Merit Awards") and performance share
awards  ("Performance  Shares"),  through May 28,  2018.  In 2008,  the Board of
Directors and the Company's  stockholders approved an amendment to the 1993 Plan
to extend the termination date for the period during which awards may be granted
under  the 1993  Plan for an  additional  10 years to May 28,  2018 from May 28,
2008.  An  aggregate  of  5,000,000  shares of the  Company's  Common  Stock are
reserved  for  issuance  under the 1993 Plan (upon the  exercise  of Options and
Stock  Appreciation  Rights,  upon awards of  Restricted  Stock and  Performance
Shares);  however,  of such shares, only 2,500,000 shares in the aggregate shall
be available for issuance for  Restricted  Stock Awards and Merit  Awards.  Such
shares shall be authorized but unissued  shares of Common Stock.  As of June 30,
2008,  there were  4,134,000  shares  available for future stock option  grants.
Options may be granted as incentive stock options  ("ISOs")  intended to qualify
for  favorable  tax treatment  under  Federal tax law or as  nonqualified  stock
options ("NQSOs"). SARs may be granted with respect to any Options granted under
the  1993  Plan  and  may be  exercised  only  when  the  underlying  Option  is
exercisable.  The 1993 Plan requires that the exercise  price of all Options and
SARs be equal to or greater than the fair market value of the  Company's  Common
Stock on the date of grant of that  Option.  The term of any ISO or related  SAR
cannot exceed ten years from the date of grant,  and the term of any NQSO cannot
exceed ten years and one month  from the date of grant.  Subject to the terms of
the 1993  Plan and any  additional  restrictions  imposed  at the time of grant,
Options and any related SARs ordinarily will become  exercisable  commencing one
year  after  the  date of  grant.  Options  granted  generally  have a ten  year
contractual  life and generally have vesting terms of two years from the date of
grant.  In the case of a "Change of  Control"  of the Company (as defined in the
1993  Plan),  Options  granted  pursuant  to the  1993  Plan  may  become  fully
exercisable as to all optioned  shares from and after the date of such Change of
Control in the  discretion  of the  Committee or as may otherwise be provided in
the grantee's Option  agreement.  Death,  retirement,  or absence for disability
will not result in the cancellation of any Options.

     No stock based compensation  expense was recorded in the second quarter and
six months  ended June 30, 2008 and June 30,  2007,  as all  previously  granted
options  vested as of January 2, 2007.  No stock option awards have been granted
since  January  2005.  Compensation  expense  relating to stock options would be
recorded in the Consolidated Statement of Operations with corresponding increase
paid in capital in the statement of stockholders' equity.

<PAGE>
                       AMBASE CORPORATION AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements

     The fair value of option  awards are  estimated  on the date of grant using
the  Black-Scholes-Merton  option  valuation model  ("Black-Scholes")  that uses
certain assumptions at the time of valuation. Expected volatilities are based on
historical  volatility of the Company's  stock. The Company uses historical data
to estimate  option  exercises  and employee  terminations  within the valuation
model.  The  expected  term  of  options  granted  is  estimated  based  on  the
contractual  lives of option grants,  option vesting period and historical  data
and  represents  the period of time that  options  granted  are  expected  to be
outstanding. The risk-free interest rate for periods within the contractual life
of the option is based on the U.S.  Treasury bond yield in effect at the time of
grant. No adjustments were made to the input  assumptions for the calculation of
the fair  value of stock  options  granted  in 2005 from the pro  forma  amounts
previously presented in the Company's prior period financial statements.

     The  Black-Scholes  option  valuation  model  requires  the input of highly
subjective assumptions, including the expected life of the stock-based award and
stock  price  volatility.   The  assumptions  utilized  were  management's  best
estimates,   but  these  estimates   involve  inherent   uncertainties  and  the
application of management  judgment.  As a result, if other assumptions had been
used, our recorded  stock-based  compensation expense could have been materially
different  from the amounts  previously  recorded.  In addition,  the Company is
required to estimate the expected forfeiture rate and only recognize expense for
those  shares  expected to vest.  If our actual  forfeiture  rate is  materially
different  from our  estimate,  the  share-based  compensation  expense could be
materially different.

     The Company believes that the use of the Black-Scholes model meets the fair
value  measurement   objectives  of  SFAS  123R  and  reflects  all  substantive
characteristics  of the  instruments  being  valued.  No stock options have been
granted since January 2005.

     The  following  table reports  stock option  activity  during the six month
period ended June 30, 2008:
<TABLE>
<S>                                                  <C>          <C>          <C>
                                                                                Weighted
                                                                  Weighted       Average
                                                                   Average      Remaining
                                                     Number of    Exercise     Contractual
                                                      Shares        Price      Life (in years)
                                                     --------     --------     ---------------
         Outstanding at January 1, 2008......        876,000      $  0.93
         Expired.............................        (10,000)        3.65
                                                     --------     ========
         Outstanding at June 30, 2008........        866,000      $  0.90           5.04
                                                     ========     ========          ====
         Exercisable at June 30, 2008........        866,000      $  0.90           5.04
                                                     =======      ========          ====
</TABLE>
     At June 30,  2008,  the exercise  price of stock  options  outstanding  and
exercisable was greater than the market price of the Company's stock; therefore,
no intrinsic value for stock options is included herein.

     There were no outstanding option shares vesting during the six month period
ended June 30, 2008.  The total fair value of shares vested during the six month
period ended June 30,  2007,  was  $96,000.  As of June 30,  2008,  there was no
unamortized  compensation  cost related to non-vested  share-based  compensation
arrangements for stock options granted under the 1993 Plan.

     Options to purchase 866,000 shares of common stock for the six months ended
June 30, 2008,  and 876,000 shares of common stock for the six months ended June
30, 2007,  were  excluded  from the  computation  of diluted  earnings per share
because these options were antidilutive.

<PAGE>
                       AMBASE CORPORATION AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements

Note 10 - Pension and Savings Plans

     The  Company   previously   sponsored  a  non  tax-qualified   supplemental
retirement  plan,  initially  adopted by the Company in 1985, and as amended and
restated  (the  "Supplemental  Plan"),  under which only one  current  executive
officer of the Company was the sole  participant.  The cost of the  Supplemental
Plan was accrued but not funded.

     In  accordance  with an amendment to the  Supplemental  Plan, as previously
adopted  in March  2006,  the  liability  for the  Supplemental  Plan was  fully
satisfied on May 31, 2007, by the lump-sum  benefit  payment of $16,676,115  (to
Mr. Bianco, the Company's Chairman,  President and Chief Executive Officer), and
immediately  thereafter,  the Supplemental Plan  automatically  terminated.  The
lump-sum Supplemental Plan benefit payment was paid from the Company's available
financial  resources.  There was no Supplemental Plan expense for the six months
ended June 30, 2008,  compared to $349,000  and $868,000 for the second  quarter
and six months ended June 30, 2007, respectively. As a result of the termination
of the  Supplemental  Plan,  as of June 1, 2007,  no further  Supplemental  Plan
expense will be  recognized by the Company.  See the Company's  Annual Report on
Form 10-K for the year ended  December  31,  2007,  Item 8 - Note 7 for  further
information.

     The Company  sponsors the AmBase 401(k) Savings Plan (the "Savings  Plan"),
which is a "Section 401(k) Plan" within the meaning of the Internal Revenue Code
of 1986, as amended (the "Code"). The Savings Plan permits eligible employees to
make  contributions  of up to 15% of  compensation,  which  are  matched  by the
Company at a percentage  determined  annually.  The employer  match is currently
100% of the amount the employee elects to defer.  Employee  contributions to the
Savings Plan are invested at the employee's  discretion,  in various  investment
funds. The Company's  matching  contributions are invested in the same manner as
the compensation reduction  contributions.  The Company's matching contributions
to the Savings Plan, charged to expense,  were $8,000 and $57,000 for the second
quarter and six months ended June 30, 2008,  respectively and $3,000 and $53,000
for the second  quarter and six months  ended June 30, 2007,  respectively.  All
contributions are subject to maximum limitations contained in the Code.

Note 11 - Common Stock Repurchase Plan

     In January 2002, the Company  announced a common stock repurchase plan (the
"Repurchase  Plan") which allows for the  repurchase  by the Company of up to 10
million shares of its common stock in the open market.

     The Repurchase Plan is conditioned upon favorable  business  conditions and
acceptable prices for the common stock.  Purchases under the Repurchase Plan may
be made,  from  time to time,  in the  open  market,  through  block  trades  or
otherwise.  Depending on market  conditions and other factors,  purchases may be
commenced or suspended any time or from time to time without prior notice.
<TABLE>
<S>                                        <C>         <C>             <C>                     <C>
                                                         Average
                                                        Price Paid
                                               Total     per Share            Total Number
                                           Number of    (including        Shares Purchased               Maximum Number
                                              Shares        broker     as Part of Publicly       Shares that may yet be
                                           Purchased   commission)         Announced Plans     Purchased under the Plan
                                           ---------   -----------     --------------------    ------------------------
Beginning balance January 1, 2008.........                                     2,424,855               7,575,145

January 1, 2008 - January 31, 2008........   189,100        $0.43              2,613,955               7,386,045
February 1, 2008 - February 28, 2008......         -         -                 2,613,955               7,386,045
March 1, 2008 - March 31, 2008............         -         -                 2,613,955               7,386,045
April 1, 2008 - April 30, 2008............    70,400         0.38              2,684,355               7,315,645
May 1, 2008 - May 31, 2008................         -         -                 2,684,355               7,315,645
June 1, 2008 - June 30, 2008..............         -         -                 2,684,355               7,315,645
                                           --------
Total....................................   259,500
                                           ========
</TABLE>

<PAGE>
                       AMBASE CORPORATION AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements

FORWARD LOOKING STATEMENTS

     This quarterly report may contain  "forward-looking  statements" within the
meaning of Section 27A of the  Securities  Act of 1933,  as amended (the "Act"),
and  Section  21E of the  Securities  Exchange  Act of  1934,  as  amended  (the
"Exchange  Act"),  or  make  oral  statements  that  constitute  forward-looking
statements. The Company intends such forward-looking statements to be covered by
the safe harbor  provisions  for  forward-looking  statements  contained  in the
Private Securities Litigation Reform Act of 1995. Forward-looking statements are
inherently subject to risks and uncertainties, many of which cannot be predicted
or  quantified.  The  forward-looking  statements  may relate to such matters as
anticipated  financial  performance,   future  revenues  or  earnings,  business
prospects,  projected  ventures,  anticipated  market  performance,  anticipated
litigation  results or the timing of pending  litigation,  and similar  matters.
When  used  in  this  Quarterly  Report,  the  words   "estimates,"   "expects,"
"anticipates,"  "believes,"  "plans," "intends" and variations of such words and
similar  expressions  are intended to identify  forward-looking  statements that
involve risks and uncertainties. The Private Securities Litigation Reform Act of
1995 provides a safe harbor for forward-looking  statements.  In order to comply
with the terms of the safe harbor,  the Company  cautions readers that a variety
of factors could cause the Company's  actual results to differ  materially  from
the  anticipated  results  or  other  expectations  expressed  in the  Company's
forward-looking  statements.  These risks and  uncertainties,  many of which are
beyond the Company's control,  include,  but are not limited to: (i) transaction
volume in the securities markets; (ii) the volatility of the securities markets;
(iii)  fluctuations  in interest  rates;  (iv) risks inherent in the real estate
business,  including,  but not limited to tenant defaults,  changes in occupancy
rates or real estate values; (v) changes in regulatory  requirements which could
affect the cost of doing  business;  (vi)  general  economic  conditions;  (vii)
changes  in the rate of  inflation  and the  related  impact  on the  securities
markets;  (viii)  changes in federal and state tax laws;  and (ix) risks arising
from  unfavorable  decisions  in our current  material  litigation  matters,  or
unfavorable  decisions in other  Supervisory  Goodwill cases.  These are not the
only risks that we face.  There may be additional risks that we do not presently
know of or that we currently  believe are immaterial which could also impair our
business and financial position.

     Undue reliance  should not be placed on these  forward-looking  statements,
which are  applicable  only as of the date  hereof.  The Company  undertakes  no
obligation  to revise or update  these  forward-looking  statements  to  reflect
events or circumstances that arise after the date of this quarterly report or to
reflect  the  occurrence  of  unanticipated  events.  Accordingly,  there  is no
assurance that the Company's expectations will be realized.

     Management's  Discussion and Analysis of Financial Condition and Results of
Operations,  which follows,  should be read in conjunction with the consolidated
financial  statements and related notes, which are contained in Part I - Item 1,
herein and the Company's  Annual Report on Form 10-K for the year ended December
31, 2007.

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

BUSINESS OVERVIEW

     AmBase is a holding company which, through a wholly-owned subsidiary,  owns
a commercial office building in Greenwich,  Connecticut.  The Company previously
owned an insurance company and a savings bank.

     In February  1991,  the  Company  sold its  ownership  interest in The Home
Insurance  Company and its subsidiaries.  On December 4, 1992,  Carteret Savings
Bank,  FA  ("Carteret")  was  placed  in  receivership  by the  Office of Thrift
Supervision ("OTS").

     The  Company's  assets  currently   consist  primarily  of  cash  and  cash
equivalents,  investment  securities,  and real estate owned.  The Company earns
non-operating   revenue   principally   consisting  of  investment  earnings  on
investment securities and cash equivalents.  The Company continues to evaluate a
number of possible  acquisitions  and is engaged in the management of its assets
and  liabilities,  including the  contingent  assets  associated  with its legal
claims,  as described in Part I - Item 1. From time to time, the Company and its
subsidiaries may be named as a defendant in various lawsuits or proceedings. The
Company intends to  aggressively  contest all litigation and  contingencies,  as
well as pursue all sources for contributions to settlements.

LIQUIDITY AND CAPITAL RESOURCES

     The Company's assets at June 30, 2008,  aggregated  $17,957,000  consisting
principally of cash and cash equivalents of $3,822,000, investment securities of
$11,722,000 and real estate owned of $2,094,000. At June 30, 2008, the Company's
liabilities aggregated $924,000. Total stockholders equity was $17,033,000.

     For the six months  ended June 30,  2008,  cash of  $3,440,000  was used by
operations,  primarily  due to the  payment of legal  expenses  relating  to the
Supervisory  Goodwill  trial and to a lesser  extent  the  payment of prior year
accruals and  operating  expenses,  partially  offset by the receipt of interest
income and investment earnings. The cash needs of the Company for the six months
ended  June 30,  2008 were  satisfied  by the  receipt  of  investment  earnings
received on investment securities and cash equivalents and the Company's current
financial  resources.  Management  believes that the Company's capital resources
are sufficient to continue operations for the next twelve months.

     For the six months ended June 30,  2007,  cash of  $17,913,000  was used by
operations,  primarily  due to the  payment of the  Supplemental  Plan  lump-sum
benefit  payment of $16,676,115,  as further  discussed  above,  and to a lesser
extent the payment of prior year  accruals  and  operating  expenses,  partially
offset by the receipt of interest income and investment earnings. The cash needs
of the Company for the first six months of 2007 were  satisfied by the Company's
financial  resources  and the  receipt  of  investment  earnings  on  investment
securities and cash equivalents.

     The Company continues to evaluate a number of possible  acquisitions and is
engaged  in  the  management  of  its  assets  and  liabilities,  including  the
contingent assets associated with its legal claims. Discussions and negotiations
are ongoing with  respect to certain of these  matters.  The Company  intends to
aggressively  contest all  litigation and  contingencies,  as well as pursue all
sources for  contributions  to  settlements.  For a  discussion  of lawsuits and
proceedings, including the Supervisory Goodwill litigation see Part I - Item 1 -
Note 3.

     As of June 30, 2008,  the Company owns one  commercial  office  building in
Greenwich,  Connecticut.  The  building is  approximately  14,500  square  feet;
approximately  3,500  square feet is  utilized by the Company for its  executive
offices; the remaining space is currently unoccupied and available for lease.

     Although the portion of the  building not being  utilized by the Company is
currently  unoccupied and available for lease,  based on the Company's  analysis
including but not limited to current market rents in the area,  leasing  values,
and comparable  property sales,  the Company believes the property's fair market
value exceeds the property's current carrying value; and, therefore the carrying
value of the property as of June 30, 2008, has not been impaired.

     There are no material  commitments for capital  expenditures as of June 30,
2008. Inflation has had no material impact on the business and operations of the
Company.

     Pursuant to the Company's  common stock  repurchase  plan (the  "Repurchase
Plan"),  during the six months ended June 30, 2008, the Company  repurchased for
approximately  $107,000  an  aggregate  of 259,500  shares of common  stock from
unaffiliated  parties  at  various  prices.  See  Part I - Item 1 - Note  11 for
further details with regard to the Repurchase Plan.
<PAGE>
     Results of Operations  for the Second Quarter and Six months ended June 30,
2008 vs. the Second Quarter and Six months ended June 30, 2007

     The Company currently earns non-operating revenue consisting principally of
investment earnings on investment securities and cash equivalents. The Company's
management believes that operating cash needs for the next twelve months will be
met principally by the receipt of investment  earnings on investment  securities
and  cash  equivalents  and  the  Company's  current  financial  resources.  The
Company's main source of revenue in 2008 was non-operating revenue consisting of
investment earnings.

     No rental  income  from real  estate  owned was earned for the 2008 or 2007
periods.

     Compensation and benefits  decreased to $449,000 and $949,000 in the second
quarter  and six  months  ended  June  30,  2008,  respectively,  compared  with
$1,116,000  and  $2,249,000  in the  respective  2007  periods.  The decrease is
primarily  due to a  decrease  in the  Supplemental  Plan  expense in the second
quarter  and  six  month  periods  ended  June  30,  2008,  as a  result  of the
Supplemental  Plan termination as of May 31, 2007,  versus the same 2007 periods
as further described below and a lower level of incentive  compensation accruals
in the 2008 periods versus the same 2007 periods.

     There was no  Supplemental  Plan  expense  for the second  quarter  and six
months  ended June 30,  2008,  compared to $349,000  and $868,000 for the second
quarter and six months  ended June 30,  2007,  respectively.  As a result of the
termination  of  the  Supplemental   Plan,  as  of  June  1,  2007,  no  further
Supplemental Plan expense will be recognized by the Company.

     The  Supplemental  Plan  expense  reflects  recognition  of an  expense  of
$159,000 and $394,000 for the second quarter and six months ended June 30, 2007,
respectively,  recorded to  increase  the  Supplemental  Plan  liability  to the
present  value of the May 31,  2007  lump-sum  payment  amount  of  $16,676,115,
utilizing a 5.75%  discount rate factor based on the 2007  Employment  Agreement
between the Company and Mr. Bianco and the amendment of the Supplemental Plan.

     An  additional  Supplemental  Plan  expense of $190,000 and $474,000 in the
second quarter and six months ended June 30, 2007,  respectively was recorded to
amortize the Supplemental Plan minimum pension liability adjustment. The minimum
pension liability adjustment, which was included as a component of stockholders'
equity within accumulated other comprehensive loss in the Company's consolidated
financial statements,  was $1,326,000 as of March 31, 2006, and was amortized on
a straight line basis over the 14-month  period from April 1, 2006,  through May
31, 2007,  as an additional  Supplemental  Plan expense of $284,000 per quarter.
The amortization of the additional minimum pension liability in the 2007 period,
although  recorded  as a  component  of  compensation  expense in the  Company's
consolidated  statement  of  operations,  did not result in a decrease  in total
stockholders' equity, as its recognition results in an increase in one component
and a corresponding decrease in another component of stockholders' equity.

     No stock based  compensation  expense was  recorded in the six months ended
June 30, 2008 or June 30, 2007, as all previously  granted  outstanding  options
vested as of January 2, 2007.  No stock option  awards have been  granted  since
January 2005.

     Professional and outside  services  increased to $906,000 and $2,773,000 in
the second quarter and six months ended June 30, 2008,  respectively compared to
$909,000 and $1,373,000 in the respective 2007 periods. The increase in the 2008
six month period as compared to the respective  2007 period is  principally  the
result  of a  higher  level of  legal  and  professional  fees  relating  to the
Supervisory  Goodwill  litigation in 2008 versus 2007. The Supervisory  Goodwill
litigation  expenses  for the  2008  period  include  expenses  relating  to the
preparation  for  the  trial,   actual  trial  expenses  and  post  trial  brief
preparation  incurred  during the first half of 2008. The  Supervisory  Goodwill
litigation  expenses in the 2007 period included expenses incurred in connection
with discovery and preparation of expert reports and deposition of the Company's
and government witnesses.

     Interest  income in the second  quarter and six months ended June 30, 2008,
decreased to $94,000 and $247,000,  respectively,  from $394,000 and $859,000 in
the respective 2007 periods. The decrease is principally due to a lower level of
cash equivalents and investment  securities as a result of the Supplemental Plan
lump-sum benefit payment to Mr. Bianco. The payment decreased the Company's cash
equivalents and investment securities by approximately $16.7 million,  resulting
in a decrease in the  interest  income  earned by the Company  beginning in June
2007. The decreased interest income is also due to a decreased  investment yield
in the six months  ending  June 30,  2008,  compared  with the  respective  2007
period.  See Item 3 - Quantitative and Qualitative  Disclosure about Market Risk
for information concerning the Company's weighted average interest rate yield on
investment securities as of June 30, 2008.
<PAGE>
     For the second  quarter and six months ended June 30, 2007,  realized gains
on sales of investment securities available for sale were $128,000 and $284,000,
respectively.  No  investment  securities  available  for sale  were sold in the
second quarter and six months ended June 30, 2008.

     Other  income of $247,000 in the second  quarter and six months  ended June
30, 2008,  is  attributable  to an Internal  Revenue  Service  ("IRS")  interest
refund,  consented  to by the IRS in June 2008,  and  received by the Company in
July 2008. The IRS refund resulted from the Company's pursuit of interest refund
claims for several prior tax years under a tax code provision  which allowed for
the retroactive recovery of the interest differential where a taxpayer had a tax
underpayment  (subject to higher interest  payment rates) for one tax year and a
simultaneous  tax  overpayment  (subject  to lower  interest  refund  rates) for
another tax year.

     The Company  recognized no income tax provision for the second  quarter and
six months  ended June 30,  2008,  as compared  with $25,000 and $50,000 for the
second quarter and six months ended June 30, 2007, respectively.  The income tax
provision is primarily  attributable to a provision for a minimum tax on capital
to the state of Connecticut.  Income taxes applicable to operating income (loss)
are generally  determined by applying the estimated  effective annual income tax
rates to pretax income (loss) for the year-to-date interim period.  Income taxes
applicable to unusual or infrequently occurring items are provided in the period
in which such items occur.
<TABLE>
<CAPTION>
TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATION
<S>                                         <C>        <C>          <C>            <C>           <C>
(in thousands)                                                     Payment Due By Period
                                            ===============================================================
                                                       Less Than       One to       Three to     More than
                                            Total       One Year    Three Years    Five Years    Five Years
                                            -----      ---------    -----------    ----------    ----------

Operating leases.......................     $  32      $     13     $        19    $        -    $        -
                                            -----      --------     -----------    ----------    ----------
Total obligations......................     $  32      $     13     $        19    $        -    $        -
                                            =====      ========     ===========    ==========    ==========
</TABLE>

Item 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     The Company holds  short-term  investments  as a source of  liquidity.  The
Company's  interest rate sensitive  investments with maturity dates of less than
one year consist of the following:
<TABLE>
<CAPTION>

                                                        June 30, 2008             December 31, 2007
                                                   =====================        =========================
<S>                                                 <C>            <C>          <C>                 <C>
                                                    Carrying       Fair         Carrying             Fair
                                                     Value         Value        Value               Value
(in thousands)                                     ---------       -----        --------            -----

U.S. Treasury Bills and Notes...............        $ 11,722      $ 11,716      $ 16,313          $ 16,329
                                                    ========      ========      ========          ========

Weighted average interest rate..............            1.88%                       4.77%
                                                    ========                    ========
</TABLE>
     The Company's  current  policy is to minimize the interest rate risk of its
short-term  investments by investing in U.S.  Treasury Bills with  maturities of
less than one year. There were no significant changes in market exposures or the
manner in which interest rate risk is managed during the period.

     The Company held no portfolio of equity  securities  as of June 30, 2008 or
December 31, 2007.
<PAGE>
Item 4T.  CONTROLS AND PROCEDURES

     Our  disclosure  controls  and  procedures  include our  controls and other
procedures to ensure that information required to be disclosed in this and other
reports under the Exchange Act of 1934 is accumulated  and  communicated  to our
management, including our Chief Executive Officer and Chief Financial Officer to
allow timely  decisions  regarding  required  disclosure and to ensure that such
information  is recorded,  processed,  summarized  and reported  within the time
periods.

     Our Chief Executive  Officer and Chief Financial  Officer have conducted an
evaluation of our disclosure  controls and procedures as of June 30, 2008. Based
upon this evaluation,  our Chief Executive  Officer and Chief Financial  Officer
have concluded  that our disclosure  controls and procedures (as defined in Rule
13a-15(e)  and  15d-15(e)  promulgated  under the Exchange Act) are effective to
ensure that the  information  required to be  disclosed  by us in the reports we
file under the Exchange Act is recorded, processed, summarized and reported with
adequate timeliness.

     There have been no changes  during the most  recent  fiscal  quarter in our
internal  control  over  financial  reporting as defined in Rule  13a-15(f)  and
15d-15(f) of the Exchange Act that have materially  affected,  or are reasonably
likely to materially affect, our internal control over financial reporting.

STOCKHOLDER INQUIRIES

     Stockholder inquiries,  including requests for the following: (i) change of
address;  (ii) replacement of lost stock  certificates;  (iii) Common Stock name
registration changes; (iv) Quarterly Reports on Form 10-Q; (v) Annual Reports on
Form 10-K; (vi) proxy material;  and (vii) information regarding stock holdings,
should be directed to:

         American Stock Transfer and Trust Company
         59 Maiden Lane
         New York, NY  10038
         Attention:  Shareholder Services
         (800) 937-5449 or (718) 921-8200 Ext. 6820

     As the Company does not maintain a website,  copies of Quarterly reports on
Form 10-Q, Annual Reports on Form 10-K and Proxy Statements can also be obtained
directly  from the Company free of charge by sending a request to the Company by
mail as follows:

         AmBase Corporation
         100 Putnam Green, 3rd Floor
         Greenwich, CT  06830
         Attn:  Shareholder Services

     The Company is subject to the  informational  requirements  of the Exchange
Act. Accordingly,  the Company's public reports,  including Quarterly Reports on
Form 10-Q,  Annual  Reports on Form 10-K and Proxy  Statements,  can be obtained
through the Securities and Exchange  Commission ("SEC") EDGAR Database available
on the SEC's website at  www.sec.gov.  Materials  filed with the SEC may also be
read or copied by visiting the SEC's Public  Reference  Room, 100 F Street,  NE,
Washington,  DC 20549. Information on the operation of the Public Reference Room
may be obtained by calling 1-800-SEC-0330.

<PAGE>
PART II - OTHER INFORMATION

Item 1.  LEGAL PROCEEDINGS

     For a discussion of the Company's legal proceedings, including a discussion
of the Company's Supervisory Goodwill litigation, see Part I - Item 1 - Note 3 -
Legal Proceedings.

Item 1A.  RISK FACTORS

     There have been no material changes from risk factors previously  disclosed
in the Company's Annual Report on Form 10-K for the year ended December 31, 2007
in response to Item 1A to Part I of Form 10-K.

Item 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

Item 3.  DEFAULTS UPON SENIOR SECURITIES

None.

Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     At the Company's annual meeting of stockholders on May 16, 2008, a vote was
taken for the  election  of two  Directors  of the  Company to hold office for a
three year term and until their  successors  shall have been duly  elected.  The
aggregate  number of shares of Common  Stock voted in person or by proxy for the
nominee was as follows:
<TABLE>
<CAPTION>
<S>                                           <C>                     <C>
  Nominee                                        For                  Withheld
================                              =========               =========

Richard A. Bianco                            29,480,063              4,005,066
Philip M. Halpern                            29,752,114              3,733,015
</TABLE>
     There were no broker  non-votes.  The terms of directors Robert E. Long and
Salvatore Trani continued after the meeting.

     A vote was also taken on the proposal to ratify the  appointment of UHY LLP
as the independent  accountants for the Company for the year ending December 31,
2008.  The  aggregate  numbers of shares of Common  Stock  voted in person or by
proxy were as follows:
<TABLE>
<CAPTION>
<S>                         <C>                            <C>
    For                       Against                       Abstain
 =========                  =========                      =========

  32,758,590                637,071                        89,465
</TABLE>
     There were no broker non-votes.

     A vote was also taken on the  proposal  to approve an  amendment  to AmBase
Corporation's 1993 Stock Incentive Plan,  extending the termination date for the
period  during which  awards may be granted  under the 1993 Plan to May 28, 2018
from May 28,  2008.  The  aggregate  numbers of shares of Common  Stock voted in
person or by proxy were as follows:
<TABLE>
<CAPTION>
<S>                         <C>                            <C>
    For                       Against                       Abstain
 =========                  =========                      =========
  11,096,356                4,259,962                      32,274
</TABLE>
     There were 18,096,537 broker non-votes.

     The  foregoing   proposals  are  described  more  fully  in  the  Company's
definitive proxy statement, filed with the Securities and Exchange Commission on
March 28,  2008  pursuant to Section  14(a) of the  Securities  Act of 1934,  as
amended, and the rules and regulations promulgated thereunder.

<PAGE>
Item 5.  OTHER INFORMATION

None.

Item 6.  EXHIBITS

     Exhibit  31.1  Rule  13a-14(a)  Certification  of Chief  Executive  Officer
     Exhibit 31.2 Rule 13a-14(a)  Certification  of Chief  Financial  Officer
     Exhibit32.1 Section 1350  Certification of Chief Executive Officer
     Exhibit 32.2 Section 1350 Certification of Chief Financial Officer

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.


AMBASE CORPORATION



/s/  John P. Ferrara
------------------------------------------------------
By    JOHN P. FERRARA
      Vice President, Chief Financial Officer and Controller
      (Duly Authorized Officer and Principal Financial and
      Accounting Officer)


Date:  July 28, 2008