FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


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


                For the quarterly period ended September 30, 1999

          [ ] 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.)

                          51 WEAVER STREET, BUILDING 2
                        GREENWICH, CONNECTICUT 06831-5155

               (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 and (2) has been subject to such filing
requirements for the past 90 days.

YES X NO

At September 30, 1999, there were 44,533,519 shares of registrant's common
stock, $0.01 par value per share, outstanding, excluding 126,488 treasury
shares.

<PAGE>

AmBase Corporation

Quarterly Report on Form 10-Q
September 30, 1999

CROSS REFERENCE SHEET FOR
PARTS I and II                                                             Page
                                                                         ------

PART I - FINANCIAL INFORMATION

Item 1.      Financial Statements.............................................1

Item 2.      Management's Discussion and Analysis of
                   Financial Condition and Results of Operations..............7

Item 3.      Quantitative and Qualitative Disclosures About Market Risk......10

PART II - OTHER INFORMATION

Item 1.      Legal Proceedings...............................................11

Item 2.      Changes in Securities...........................................12

Item 3.      Defaults Upon Senior Securities.................................12

Item 4.      Submission of Matters to a Vote of Security Holders.............12

Item 5.      Other Information...............................................12

Item 6.      Exhibits and Reports on Form 8-K................................12

<PAGE>

PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                       AMBASE CORPORATION AND SUBSIDIARIES
                      Consolidated Statements of Operations
                Third Quarter and Nine Months Ended September 30
                                   (Unaudited)
                      (in thousands, except per share data)

<TABLE>
<CAPTION>
                                                                           Third Quarter                        Nine Months
                                                                        1999              1998               1999             1998
                                                                        ====              ====               ====             ====
<S>                                                              <C>                <C>                <C>                <C>
Operating expenses:
Compensation and benefits ..............................          $    823           $    473           $  2,524           $  1,431
Professional and outside services ......................               578                127              1,990                777
Insurance ..............................................                22                 20                 57                 65
Occupancy ..............................................                27                 22                 78                 65
Other operating ........................................                32                 34                116                 89
                                                                  --------           --------           --------           --------
                                                                     1,482                676              4,765              2,427
                                                                  --------           --------           --------           --------
Operating loss .........................................            (1,482)              (676)            (4,765)            (2,427)
                                                                  --------           --------           --------           --------
Interest income ........................................               544                595              1,598              1,820
Other income ...........................................                50              2,500                154              2,500
                                                                  --------           --------           --------           --------
Income (loss) before income taxes ......................              (888)             2,419             (3,013)             1,893
Income tax expense .....................................               (46)               (59)              (169)              (187)
                                                                  --------           --------           --------           --------

Net income (loss) ......................................          $   (934)          $  2,360           $ (3,182)          $  1,706
                                                                  ========           ========           ========           ========
Earnings per common share:
Net income (loss) - basic ..............................          $  (0.02)          $   0.05           $  (0.07)          $   0.04
Net income (loss) - assuming dilution ..................             (0.02)              0.05              (0.07)              0.04
                                                                  ========           ========           ========           ========

Average shares outstanding .............................            44,534             44,534             44,534             44,534
                                                                  ========           ========           ========           ========
</TABLE>
The  accompanying  notes are an integral  part of these  consolidated financial
statements.


<PAGE>

                       AMBASE CORPORATION AND SUBSIDIARIES
                           Consolidated Balance Sheets
                                 (in thousands)
<TABLE>
<CAPTION>
                                                                                      Sept. 30,       December 31,
                                                                                           1999               1998
                                                                                    (unaudited)
                                                                                       ========          =========
<S>                                                                                  <C>                <C>
Assets
Cash and cash equivalents ....................................................        $   1,687          $   2,886
Investment securities - held to maturity (market
    value $45,183 and $47,160, respectively) ..................................          45,170             47,156
Investment in SDG, Inc. at cost ...............................................           1,250              1,250
Other assets ..................................................................             562                346
                                                                                      ---------          ---------

Total assets ..................................................................       $  48,669          $  51,638
                                                                                      =========          =========
Liabilities and Stockholders' Equity
Liabilities:
Accounts payable and accrued liabilities .....................................        $   1,698          $   1,642
Supplemental retirement plan ..................................................           5,429              5,079
Postretirement welfare benefits ................................................          1,194              1,301
Other liabilities .............................................................             110                152
Litigation and contingency reserves ............................................          2,032              2,076
Income tax reserves ...........................................................          66,388             66,388
                                                                                      ---------          ---------
Total liabilities ..............................................................         76,851             76,638
                                                                                      ---------          ---------
Commitments and contingencies .................................................              --                 --
                                                                                      ---------          ---------
Stockholders' equity:
Common stock ..................................................................             447                447
Paid-in capital ...............................................................         547,712            547,712
Accumulated deficit ...........................................................        (575,694)          (572,512)
Treasury stock ................................................................            (647)              (647)
                                                                                      ---------          ---------
Total stockholders' equity ....................................................         (28,182)           (25,000)
                                                                                      ---------          ---------

Total liabilities and stockholders' equity ....................................       $  48,669          $  51,638
                                                                                      =========          =========
</TABLE>
The accompanying  notes are an integral  part of these  consolidated  financial
statements.


<PAGE>
                       AMBASE CORPORATION AND SUBSIDIARIES
                      Consolidated Statements of Cash Flows
                         Nine Months Ended September 30
                                 (in thousands)
<TABLE>
<CAPTION>
                                                                                                            1999               1998
                                                                                                            ====               ====
<S>                                                                                                    <C>               <C>
Cash flows from operating activities:
Net income (loss) ............................................................................          $ (3,182)          $  1,706
Adjustments to reconcile net income (loss) to net cash used by operations:
Other assets .................................................................................                12                 56
Accounts payable and accrued liabilities .....................................................                56             (1,317)
Litigation and contingency reserves uses .....................................................               (44)              (161)
Income tax reserves uses .....................................................................                --            (12,700)
Other liabilities ............................................................................               200                 34
Amortization of discount - investment securities .............................................            (1,583)            (1,749)
Other, net ...................................................................................                13                 57
                                                                                                        --------           --------
Net cash used by operating activities ........................................................            (4,528)           (14,074)
                                                                                                        --------           --------
Cash flows from investing activities:
Maturities of investment securities - held to maturity .......................................            96,521             44,746
Purchases of investment securities - held to maturity ........................................           (92,952)           (48,329)
Purchases of other investment securities .....................................................              (250)                --
Proceeds from Home Holdings, Inc. receivable .................................................                --             12,708
Other, net ...................................................................................                10                  7
                                                                                                        --------           --------
Net cash provided by investing activities ....................................................             3,329              9,132
                                                                                                        --------           --------
Net decrease in cash and cash equivalents ....................................................            (1,199)            (4,942)
Cash and cash equivalents at beginning of period .............................................             2,886              5,548
                                                                                                        --------           --------
Cash and cash equivalents at end of period ...................................................          $  1,687          $     606
                                                                                                        ========           ========
Supplemental cash flow disclosures:
Income taxes paid ............................................................................          $    164          $  12,861
                                                                                                        ========           ========
</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
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 of normal recurring adjustments, necessary for a fair presentation of
the Company's financial position and results of operations. Results for interim
periods are not necessarily indicative of results for the full year. Certain
reclassifications have been made to the 1998 consolidated financial statements
to conform with the 1999 presentation. The consolidated financial statements
have been prepared in accordance with generally accepted accounting principles
("GAAP"). The preparation of financial statements in conformity with GAAP
requires management to make certain 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 accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. Substantial contingent and
alleged liabilities exist against the Company through certain lawsuits and
governmental proceedings; see Part II - Item 1. These factors raise substantial
doubt about the Company's ability to continue as a going concern. The financial
statements do not include adjustments to the carrying value of assets and
liabilities, which might be necessary should the Company not continue in
operation. In order to continue on a long-term basis, the Company must both
resolve its contingent and alleged liabilities by prevailing upon or settling
these claims for less than the amounts claimed and generate profits by acquiring
existing operations and/or by developing new operations. The Company continues
to evaluate a number of possible acquisitions, and is engaged in the management
of its remaining assets and liabilities, including the contingent and alleged
tax and litigation liabilities, as described in Part II - Item 1. The Company
intends to aggressively contest all pending and threatened litigation and
governmental proceedings, as well as pursue all sources for contributions to
settlements. The unaudited interim financial statements presented herein 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, 1998.

The Company's main source of non-operating revenue is interest earned on
investment securities and cash equivalents. The Company's management expects
that operating cash needs for the remainder of 1999 will be met principally by
the Company's current financial resources, and the receipt of non-operating
revenue consisting of interest income received on investment securities and
cash equivalents.

Note 2 - Legal Proceedings

The Company has significant alleged tax liabilities and is a defendant in
certain lawsuits and governmental proceedings, the ultimate outcome of which
could have a material adverse effect on its financial condition and results of
operations. Because of the nature of the contingent and alleged tax and
litigation liabilities described in Part II - Item 1, and the inherent
difficulty in predicting the outcome of the litigation and governmental
proceedings, management is unable to predict whether the Company's recorded
reserves will be adequate or its resources sufficient to satisfy its ultimate
obligations. The accompanying consolidated financial statements do not include
any adjustments that might result from the outcome of these uncertainties.
Although the basis for the calculation of the litigation and contingency
reserves and income tax reserves are regularly reviewed by the Company's
management and outside legal counsel, the assessment of these reserves includes
an exercise of judgment and is a matter of opinion. At September 30, 1999, the
litigation and contingency reserves, other than for income tax issues, were
$2,032,000. For a discussion of alleged tax liabilities, lawsuits and
governmental proceedings, see Part II - Item 1.

In addition to the litigation and contingency reserves, the Company has a
reserve for income taxes of $66,388,000 at September 30, 1999. For a further
discussion, see Part II - Item 1 - Legal Proceedings, Disputes with Internal
Revenue Service, Withholding Taxes (Netherlands Antilles).

See Part II - Item 1 - Legal Proceedings, for a discussion of Supervisory
Goodwill Litigation and information regarding the Company's claims against Home
Holdings, Inc.


<PAGE>

                       AMBASE CORPORATION AND SUBSIDIARIES
             Notes to Consolidated Financial Statements (continued)

Note 3 - Cash and Cash Equivalents

Highly liquid  investments, consisting  principally of funds held in short-term
money market accounts, are classified as cash equivalents.

Note 4 - Investment Securities

Investment securities - held to maturity  consist of U.S.  Treasury  Bills with
original maturities of one year or less and which are carried at amortized cost
based upon the Company's  intent  and  ability  to hold  these  investments  to
maturity.

Investment  securities - held to maturity at September 30, 1999 and December 31,
1998 consist of the following:
<TABLE>
<CAPTION>

                                           September 30, 1999                          December 31, 1998
                              =====================================            =====================================
<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
                                ======       =========       ======           ========      =========       =======

U.S. Treasury Bills           $ 45,170        $ 45,170      $ 45,183          $  47,156       $ 47,156     $   47,160
                                ======          ======        ======             ======         ======         ======
</TABLE>
<TABLE>
<CAPTION>

The gross unrealized gains on investment securities at September 30 and December
31 consist of the following:

                                                                                 1999                         1998
                                                                                ======                      ======
                                                                                           (in thousands)
<S>                                                                             <C>                         <C>
Held to Maturity - Gross unrealized gains                                     $     13                    $      4
                                                                                ======                       ======
</TABLE>

Other investment securities consist of convertible preferred and/or common
stock in AMDG, Inc., which were purchased through private placements, are
classified as other assets, and are carried at cost which approximates market
value; $350,000 at September 30, 1999 and $100,000 at December 31, 1998.

<PAGE>

Note 5 - 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, unless a greater than 50% probability exists that the tax benefits will not
actually be realized sometime in the future. The Company has calculated a net
deferred tax asset of $28 million as of September 30, 1999 and $25 million as of
December 31, 1998, arising primarily from net operating loss ("NOL")
carryforwards, the excess of book over tax reserves and alternative minimum tax
credits (not including the anticipated tax effects of NOL's expected to 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.

As a result of the Office of Thrift Supervision's ("OTS") December 4, 1992
placement of Carteret in receivership, under the management of the Resolution
Trust Corporation ("RTC")/Federal Deposit Insurance Corporation ("FDIC"), and
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"), but this information has not yet been received.
Since the Company did not make the election decision, as described above, once
it receives the requested information from the RTC/FDIC, the Company will amend
its consolidated federal income tax returns to include the federal income tax
effects of Carteret and Carteret FSB. Based on the information currently
available, the Company does not believe a material increase in the Company's
tax liabilities will result.

The Company anticipates that, as a result of filing consolidated federal income
tax returns with Carteret FSB, approximately $170 million of tax NOL
carryforwards will be generated from the Company's tax basis in
Carteret/Carteret FSB as tax losses are incurred by Carteret FSB, of which $145
million are still available. The NOL carryforwards generated from the Company's
tax basis in Carteret/Carteret FSB would expire no earlier than 2007, and would
be available to offset future taxable income, in addition to the NOL
carryforwards as noted below.

In June 1998, the Company paid $12,700,000 to the IRS for tax and estimated
interest in full satisfaction of the Company's Fresh Start tax liability, which
related to a 1987 tax dispute with the IRS. In connection with the Company's
payment to the IRS, the Company also utilized approximately $40 million of
NOL's. As a result, the Company has remaining NOL carryforwards of approximately
$14 million expiring beginning in 2008, and $145 million of additional NOL
carryforwards generated from the Company's tax basis in Carteret/Carteret FSB
expiring no earlier than 2007.

The Company contractually assumed the tax liabilities of City Investing Company
("City"), which, prior to September 1985, owned all the outstanding shares of
Common Stock of the Company. For all periods through 1992, the IRS and the
Company disagree only with respect to withholding taxes in connection with a
Netherlands Antilles finance subsidiary of City. The Company's federal income
tax returns for years subsequent to 1992 have not been reviewed by the IRS.

The Company has a reserve for income taxes of $66,388,000 at September 30, 1999.
For a further discussion, see Part II - Item 1 - Legal Proceedings, Disputes
with Internal Revenue Service, Withholding Taxes (Netherlands Antilles).

<PAGE>

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

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 Item 1, herein.

FINANCIAL CONDITION

The Company's assets at September 30, 1999 aggregated $48,669,000 consisting
principally of cash and cash equivalents of $1,687,000 and investment securities
of $45,170,000. At September 30, 1999, the Company's liabilities, including
reserves for contingent and alleged liabilities, as further described in Part II
- Item 1, exceeded total recorded assets by $28,182,000.

The Company contractually assumed the tax liabilities of City Investing Company
("City"), which, prior to September 1985, owned all the outstanding shares of
Common Stock of the Company. For all periods through 1992, the IRS and the
Company disagree only with respect to withholding taxes in connection with a
Netherlands Antilles finance subsidiary of City. The Company's federal income
tax returns for years subsequent to 1992 have not been reviewed by the IRS.

With respect to the Withholding Taxes issue, in connection with a Netherlands
Antilles finance subsidiary of City, on May 11, 1995, the IRS issued a Notice of
Deficiency for withholding taxes on interest payments for the years 1979 through
1985. In the Notice of Deficiency, the IRS contends that City's wholly owned
Netherlands Antilles finance subsidiary should be disregarded for tax purposes.
The Company vigorously contested the IRS's position in accordance with the IRS's
internal appeals procedures. In January 1992, the National Office of the IRS
issued technical advice supporting the auditing agent's position. In October
1992, the Company appealed this technical advice to the National Office. The
National Office advised the Company that it expected to issue technical advice
supporting the auditing agent's position, whereupon the Company advised the IRS
that it was withdrawing its technical advice request.

On June 30, 1995, the Company filed a petition in the United States Tax Court
("Tax Court") contesting the Notice of Deficiency. The IRS filed its answer on
August 23, 1995. The Company filed a motion for summary judgment in its favor on
February 13, 1996. On April 17, 1996, the IRS filed a Notice of Objection to the
Company's motion for summary judgment. The Tax Court requested, and the Company
filed, on July 3, 1996, a reply to the IRS's Notice of Objection. On September
19, 1996, the Court denied the Company's motion for summary judgment without
prejudice. Based on the Tax Court's examination of the record and the status of
the discovery process, the Tax Court concluded that summary adjudication at this
time was inappropriate. The Tax Court directed the parties to engage in full and
complete discovery as expeditiously as possible. A trial was held in this case
on March 24, 1997, after which the Judge asked the IRS and the Company to submit
post-trial briefs, which have subsequently been submitted to the Tax Court. If
the IRS were to prevail on this issue, the Company would be liable for taxes and
interest in excess of the Company's financial resources.

In a case dealing with a similar withholding tax issue, the Tax Court ruled in
favor of the taxpayer, Northern Indiana Public Service Co. ("Northern Indiana"),
in November 1995. The Tax Court rejected the IRS's contention that interest paid
to Northern Indiana's foreign subsidiary were subject to United States tax
withholding. The IRS appealed this decision (Northern Indiana Public Service Co.
v. Commissioner) to the United States Court of Appeals for the 7th Circuit (the
"Appeals Court"). The Appeals Court affirmed the Tax Court's ruling in favor of
Northern Indiana. Although the Appeals Court decision in the Northern Indiana
case could be beneficial to the Company's case, it is not necessarily indicative
of the ultimate result of the final settlement of the Netherlands Antilles issue
between the Company and the IRS.

Based on an evaluation of the IRS's contention, counsel has advised the Company
that, although the outcome in litigation can by no means be assured, the Company
has a very strong case and should prevail. Notwithstanding counsel's opinion and
the Tax Court's ruling in the Northern Indiana case, it is not possible at this
time to determine the final disposition of this issue, when the issues will be
resolved, or their final financial effect. A final disposition of this issue in
the Company's favor would have a material positive effect on the Company's
Consolidated Statement of Operations and Financial Condition.

<PAGE>

The Company has a reserve for income taxes of $66,388,000 at September 30, 1999.
For a further discussion, see Part II - Item 1 - Legal Proceedings, Disputes
with Internal Revenue Service, Withholding Taxes (Netherlands Antilles).

At September 30, 1999, the litigation and contingency reserves, other than for
income tax issues, were $2,032,000. For a discussion of alleged tax liabilities,
lawsuits and governmental proceedings, see Part II Item 1.

The Company has significant alleged tax liabilities and is a defendant in
certain lawsuits and governmental proceedings, the ultimate outcome of which
could have a material adverse effect on its financial condition and results of
operations. Because of the nature of the contingent and alleged liabilities and
the inherent difficulty in predicting the outcome of the litigation and
governmental proceedings, management is unable to predict whether the Company's
recorded reserves will be adequate or its resources sufficient to satisfy its
ultimate obligations. The accompanying consolidated financial statements do not
include any adjustments that might result from the outcome of these
uncertainties. Although the basis for the calculation of the litigation and
contingency reserves and the income tax reserves are regularly reviewed by the
Company's management and outside legal counsel, the assessment of these reserves
includes an exercise of judgment, and is a matter of opinion. For a discussion
of alleged tax liabilities, lawsuits and governmental proceedings, see Part II -
Item 1.

The cash needs of the Company for the first nine months of 1999 were principally
satisfied by interest income received on investment securities and cash
equivalents, and the Company's current financial resources. Management believes
that the Company's cash resources are sufficient to continue operations for
1999.

For the nine months ended September 30, 1999, cash of $4,528,000 was used by
operations, including the payment of prior year accruals and operating expenses,
partially offset by the receipt of interest income.

For the nine months ended September 30, 1998, cash of $14,074,000 was used by
operations, including the payment of $12,700,000 to the IRS for the Company's
Fresh Start tax liability (which related to a 1987 tax dispute with the IRS),
the payment of prior year accruals and the payment of operating expenses,
partially offset by the receipt of interest income and amounts received pursuant
to the Home Holdings Revised Bankruptcy Plan.

The Company continues to evaluate a number of possible acquisitions and is
engaged in the management of its remaining assets and liabilities, including the
contingent and alleged tax and litigation liabilities, as described above.
Extensive discussions and negotiations are ongoing with respect to certain of
these matters. The Company intends to aggressively contest all pending and
threatened litigation and governmental proceedings, as well as pursuing all
sources of contributions to settlements. In order to continue on a long-term
basis, the Company must both resolve its contingent and alleged liabilities by
prevailing upon or settling these claims for less than the amounts claimed, and
generate profits by acquiring existing operations and/or by developing new
operations.

There were no material commitments for capital expenditures as of September 30,
1999.

<PAGE>

Results of Operations
<TABLE>
<CAPTION>

Summarized  financial  information of the Company for the third quarter and
nine months ended September 30 is as follows:

                                                                                               Third Quarter          Nine Months
                   (in thousands)                                                             1999       1998       1999       1998
                                                                                           =======    =======    =======    =======
<S>                                                                                       <C>        <C>        <C>         <C>
Operating expenses:
Compensation and benefits ..............................................................   $   823        473    $ 2,524    $ 1,431
Professional and outside services ......................................................       578        127      1,990        777
Insurance ..............................................................................        22         20         57         65
Occupancy ..............................................................................        27         22         78         65
Other operating ........................................................................        32         34        116         89
                                                                                           -------    -------    -------    -------
                                                                                             1,482        676      4,765      2,427
                                                                                           -------    -------    -------    -------
Operating loss .........................................................................    (1,482)      (676)    (4,765)    (2,427)
                                                                                           -------    -------    -------    -------
Interest income ........................................................................       544        595      1,598      1,820
Other income ...........................................................................        50      2,500        154      2,500
                                                                                           -------    -------    -------    -------
Income (loss) before income taxes ......................................................      (888)     2,419     (3,013)     1,893
Income tax expense .....................................................................       (46)       (59)      (169)      (187)
                                                                                           -------    -------    -------    -------
Net income (loss) ......................................................................   $  (934)   $ 2,360    $(3,182) $   1,706
                                                                                           =======    =======    =======    =======
</TABLE>
The Company's main source of non-operating revenue is interest income earned on
investment securities and cash equivalents. The Company's management expects
that operating cash needs for the remainder of 1999 will be met principally by
the Company's current financial resources and the receipt of non-operating
revenue consisting of interest income earned on investment securities and cash
equivalents.

The Company recorded a net loss of $ 934,000, or $ 0.02 per share, and $
3,182,000, or $ 0.07 per share for the third quarter and nine months ended
September 30, 1999, respectively. The Company recorded net income of $2,360,000
or $0.05 per share and $1,706,000, or $0.04 per share for the third quarter and
nine months ended September 30, 1998, respectively. The 1998 third quarter and
nine-month period includes $2,500,000 of other income received in connection
with the Home Holdings Revised Bankruptcy Plan. Excluding the $2,5000,000 of
other income, the Company would have reported a net loss of $140,000 and
$794,000 in the third quarter and nine-month period ended September 30, 1998,
respectively.

Compensation and benefits increased to $823,000 and $2,524,000 in the third
quarter and nine months ended September 30, 1999, respectively, compared with
$473,000 and $1,431,000, in the respective 1998 periods. The increase in the
1999 periods is due to the accrual on a monthly basis of 1999 incentive
compensation, which is not guaranteed, as compared to accruing these amounts at
year-end, and also a higher level of benefit accruals.

Professional and outside services were $578,000 and $1,990,000 in the third
quarter and nine month periods ended September 30, 1999 respectively, compared
to $127,000 and $777,000 in the respective 1998 periods. The increase in the
1999 periods is primarily the result of legal fees attributable to supervisory
goodwill litigation, offset to some extent by a reduction of legal fees
attributable to the Home Holdings, Inc. bankruptcy case, which were incurred in
the respective 1998 periods.

Insurance expenses decreased to $57,000 for the nine month period ended
September 30, 1999, compared to $65,000 in the same 1998 period, due to
management's continued renegotiations of insurance premiums.

Interest income in the third quarter and nine months ended September 30, 1999
decreased to $544,000 and $1,598,000, respectively, from $595,000 and $1,820,000
in the respective 1998 periods. The decrease was attributable to a decreased
yield on cash equivalents and investment securities during the 1999 periods and
a lower average level of investments held in 1999 compared with 1998.

<PAGE>
Other income of $ 50,000 in the 1999 third quarter and $154,000 for the nine
months ended September 30, 1999 is principally due to the collection by an
inactive subsidiary of a receivable previously considered uncollectible. As
noted above, the $2,500,000 of other income in the 1998 third quarter and
nine-month periods represents a portion of the amounts received pursuant to the
Home Holdings Revised Bankruptcy Plan.

The income tax provisions of $46,000 and $169,000 in the third quarter and nine
months ended September 30, 1999, respectively, and $59,000 and $187,000 in the
third quarter and nine months ended September 30, 1998, respectively, are
primarily attributable to provisions for state taxes. 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.

Year 2000 Issue

The Company has completed its review of year 2000 issues and has determined it
will not have a material effect on the Company's business, results of operations
or financial condition.

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  at  September  30,  1999  consist of the
following:

                                                           Maturity Date
                                                   Less Than               Fair
(in thousands)                                      One Year              Value
                                                     =======              =====
U.S. Treasury Bills............................   $   45,170         $   45,183
                                                       =====              =====
Weighted average interest rate.................         4.68%
                                                       =====

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 quarter.


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
         40 Wall Street, 46th Floor
         New York, NY  10005
         Attention:  Shareholder Services
         (800) 937-5449 or (718) 921-8200

In addition, 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 EDGAR Database over the Internet, at
www.sec.gov.

<PAGE>


Part II - OTHER INFORMATION

Item 1.  Legal Proceedings

The information contained in Item 8 - Note 13 in AmBase's Annual Report on Form
10-K for the year ended December 31, 1998 and in AmBase's Quarterly Reports on
Form 10-Q for the quarterly periods ended March 31, 1999 and June 30, 1999 are
incorporated by reference herein and the defined terms set forth below have the
same meaning ascribed to them in those reports. There have been no material
developments in such legal proceedings, except as set forth below.

The actions against the Company are in various stages. Nevertheless, the
allegations and claims are material and, if successful, could result in
substantial judgments against the Company. To the extent the aggregate of any
such judgments were to exceed the resources available, these matters would have
a material adverse effect on the Company's financial condition and results of
operations. Due to the nature of these proceedings, the Company and its counsel
are unable to express any opinion as to their probable outcome.

Supervisory Goodwill Litigation. On September 9, 1999, the Company filed a
motion in its lawsuit against the United States in the U.S. Court of Federal
Claims entitled Plaintiffs' Motion For Partial Summary Judgment On Liability.


AmBase Corporation v. Zurich SF Holdings, Inc. (f/k/a Reorganized Home Holdings,
Inc.). On October 20, 1999, Zurich's motion to dismiss the Company's complaint
in its entirety was denied. However, under the relevant statute of limitations,
such portion of the Company's claims which accrued more than six years prior to
the filing of the complaint were deemed dismissed.

<PAGE>

ITEM 2.       CHANGES IN SECURITIES

Does not apply.

ITEM 3.       DEFAULTS UPON SENIOR SECURITIES

Does not apply.

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

Does not apply.

ITEM 5.       OTHER INFORMATION

None

ITEM 6.       EXHIBITS AND REPORTS ON FORM 8-K

(a)   Exhibits

      27.  Financial Data Schedule (only submitted to SEC in electronic format)

(b)   Form 8-K

      None

                                   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



By    JOHN P. FERRARA
      Vice President, Chief Financial Officer and Controller
      (Principal Financial and
      Accounting Officer)

Date:  November 2, 1999


<PAGE>
                              EXHIBIT INDEX


Exhibit
  No.                 Description
-------               -----------

  27                  Financial Data Schedule - September 30, 1999



                                   -13-