UNITED STATES
                SECURITIES AND EXCHANGE COMMISSION
                      WASHINGTON, D.C. 20549
                            FORM 10-K

[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934
           For the Fiscal Year Ended December 31, 1996
                                OR
[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES
     EXCHANGE ACT OF 1934
        For the transition period from _______________ to
_______________.

                  Commission file number 0-16637

                  BROAD NATIONAL BANCORPORATION
      (Exact name of registrant as specified in its charter)

New Jersey                                     22-2395057
(State or other jurisdiction               (I.R.S. Employer 
of incorporation or organization)       Identification Number)

905 Broad Street, Newark, New Jersey                      07102  
(Address of principal executive offices)               (Zip Code)


       Registrant's telephone number, including area code: 
                          (201) 624-2300

   SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
                               NONE
   SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
             Common Stock, par value $1.00 per share

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

     The aggregate market value of the 3,343,066 shares of voting
stock of the Registrant held by non-affiliates of the Registrant
on February 28, 1997, computed by reference to the closing sale
price of such stock as reported on NASDAQ, was approximately
$46,803,000.  As of February 28, 1997, there were 4,654,688
shares of the Registrant's Common Stock outstanding.

               DOCUMENTS INCORPORATED BY REFERENCE

Portions of the following document are incorporated by reference
into the indicated parts of this report: definitive Proxy
Statement for the 1997 Annual Meeting of Shareholders to be filed
with the Commission pursuant to Regulation 14A - Part III.


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                              PART I

ITEM 1.  BUSINESS.

                    BUSINESS OF BANCORPORATION

GENERAL

          Broad National Bancorporation ("Bancorporation") is a
bank holding company registered under the Bank Holding Company
Act of 1956, as amended (the "BHC Act").  Although Bancorporation
was incorporated under the laws of the State of New Jersey on
April 7, 1981, it did not engage in any business activity until
February 1, 1983.  On that date, it acquired all of the issued
and outstanding capital stock of Broad National Bank, a national
banking association (the "Bank") pursuant to a corporate
reorganization involving an exchange of shares.  Bancorporation's
activities currently are limited to ownership of the outstanding
capital stock of the Bank and to performing certain services for
the Bank.  Except as otherwise provided herein, references herein
to "Bancorporation" include Bancorporation and its consolidated
subsidiaries.

          Bancorporation's principal executive offices are
located at 905 Broad Street, Newark, New Jersey 07102, and its
telephone number is (201) 624-2300.

DESCRIPTION OF BUSINESS

          BANCORPORATION

          Bancorporation is a bank holding company registered
under the BHC Act.  Bancorporation's activities currently are
limited to ownership of the outstanding capital stock of the Bank
and to performing certain services for the Bank.

          THE BANK

          The Bank is a national banking association organized in
1925 under the laws of the United States with offices in Newark
(7 offices), East Orange, Millburn, North Arlington, Livingston,
Perth Amboy, Kearny and Elizabeth (2 offices), New Jersey.  The
Bank is a full service commercial bank and offers a broad range
of commercial and retail banking services.  It offers checking
accounts, savings accounts, money market accounts and individual
retirement accounts (IRAs), as well as various other types of
time deposits which are insured by the Bank Insurance Fund
("BIF") administered by the Federal Deposit Insurance Corporation
("FDIC") to the full extent provided by law.  The Bank also
provides typical bank services such as cashiers checks, United
States Savings Bonds and travelers checks.  The Bank had total
deposits of $429,681,000 as of December 31, 1995 and of


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$485,073,000 as of December 31, 1996.  See "Item 7.  Management's
Discussion and Analysis of Financial Condition and Results of
Operation."

          The Bank originates and services both secured and
unsecured loans which totaled $259,728,000 as of December 31,
1995 and $278,585,000 as of December 31, 1996, in each case, net
of deferred loan fees and the allowance for possible loan losses. 
Commercial lending operations include various types of credit for
the Bank's commercial and industrial customers.  The Bank's
installment loan department makes direct loans to individuals. 
The Bank's mortgage loan department makes a variety of
residential, industrial, and commercial loans secured by real
estate.  See "Item 7.  Management's Discussion and Analysis of
Financial Condition and Results of Operation."

          The Bank also provides agency and custody services for
individuals and institutional accounts, serves as fiscal and
paying agent, and as escrow agent.  The Bank has trust powers
which permit it to administer trusts and estates, although the
Bank has no trust accounts at this time.

          The Bank currently has fourteen branch banking
facilities in addition to its main location.  See "Item 2. 
Properties."

          EMPLOYEES

          Bancorporation and the Bank have approximately 191
full-time employees and 27 part-time employees.  Neither
Bancorporation nor the Bank is a party to any collective
bargaining agreement and employee relations are deemed to be
satisfactory.

          SERVICE AREA AND COMPETITION

          The principal market is defined as all of Essex County,
the southern quadrant of Bergen County, the northeast quadrant of
Union County and the northeast quadrant of Middlesex County, New
Jersey.  This market area is highly competitive with many banks
and financial institutions vying for the same business.  Most of
the Bank's competitors are institutions of far greater size and
the Bank's deposits constitute less than one percent of the
commercial bank deposits in its market area.

          The Bank encounters intense competition in local and
national markets from non-banking as well as banking sources in
all of its activities, including many competitors which have
substantially greater resources, name recognition and market
presence than the Bank.  As a lender it competes not only with
other banks but also with savings and loan associations, savings
banks, credit unions, finance companies, mortgage companies,


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factoring companies, insurance companies, and other financial
institutions, many of which have higher legal lending limits.  It
competes for deposits with other banks, savings banks, savings
and loan associations, credit unions, mutual funds, money market
funds, and issuers of commercial paper and other securities. 
Such competition is particularly intense from the Bank's Newark,
New Jersey-based competitors.  Trends toward the consolidation of
the banking industry may make it more difficult for smaller banks
and financial institutions, such as the Bank, to compete with
large, national and regional banking institutions.

SUPERVISION AND REGULATION    

          FEDERAL BANK HOLDING COMPANY ACT

          GENERAL.  Bancorporation is a registered bank holding
company within the meaning of the BHC Act, subject to the
supervision of the Board of Governors of the Federal Reserve
System (the "Federal Reserve Board").  Bancorporation is required
to file with the Federal Reserve Board an annual report and such
other additional information as the Federal Reserve Board may
require pursuant to the BHC Act.  Also, the Federal Reserve Board
periodically examines Bancorporation.  The Federal Reserve Board
has authority to issue cease and desist orders against bank
holding companies if it determines that their actions represent
unsafe and unsound practices or violations of law.  In addition,
the Federal Reserve Board is empowered to impose substantial
civil money penalties for violations of banking statutes and
regulations.  Regulation by the Federal Reserve Board is intended
to protect depositors of the Bank, not shareholders of
Bancorporation.

          SOURCE OF STRENGTH.  Federal Reserve Board policy
requires a bank holding company to serve as a source of financial
and managerial strength to its subsidiary banks.  Under this
policy, a bank holding company is expected to stand ready to use
its available resources to provide adequate capital funds to its
subsidiary banks during periods of financial stress or adversity,
and to maintain resources and the capacity to raise capital which
it can commit to its subsidiary banks.  It is the Federal Reserve
Board's position that the failure of a bank holding company to
serve as a source of strength to a distressed subsidiary bank is
an unsafe and unsound banking practice.  This has become known as
the "source of strength doctrine."  It is not clear whether the
source of strength doctrine is legally enforceable by the Federal
Reserve Board.

          LIMITATION ON ACQUISITIONS.  The BHC Act requires every
bank holding company to obtain the prior approval of the Federal
Reserve Board before (i) taking any action that causes a bank to
become a controlled subsidiary of the bank holding company, (ii)
acquiring direct or indirect ownership or control of voting



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shares of any bank or bank holding company, if the acquisition
results in the acquiring bank holding company having control of
more than 5% of the outstanding shares of any class of voting
securities of such bank or holding company and such bank or bank
holding company is not majority-owned by the acquiring bank
holding company prior to the acquisition, (iii) the acquisition
by a bank holding company or any nonbank subsidiary thereof of
all or substantially all of the assets of a bank, or (iv) a
merger or consolidation with another bank holding company.

          In determining whether to approve a proposed
acquisition, merger or consolidation, the Federal Reserve Board
is required to take into account the competitive effects of the
proposed acquisition, the convenience and needs of the community
to be served, and the financial and managerial resources and
future prospects of the bank holding companies and banks
concerned.  If a proposed acquisition, merger or consolidation
might have the effect in any section of the United States to
substantially lessen competition or to tend to create a monopoly,
or if such proposed acquisition, merger, or consolidation
otherwise would be in restraint of trade, then the Federal
Reserve Board may not approve it unless it finds that the
anticompetitive effects are clearly outweighed in the public
interest by the probable effect of the proposed transaction in
meeting the convenience and needs of the community to be served. 
Bancorporation has no current plans to acquire any interest in
the voting stock or assets of any bank or other financial
institution, although such an acquisition may be considered in
the future.

          LIMITATION ON CERTAIN ACTIVITIES.  The BHC Act also
prohibits a bank holding company, with certain exceptions, from
engaging in, and from acquiring direct or indirect ownership or
control of the voting shares or assets of any company engaged in
any activity other than banking or managing or controlling banks,
and any activity which the Federal Reserve Board determines to be
so closely related to banking, or managing or controlling banks,
as to be a proper incident thereto.  In acting on an application
to engage in such an activity, the Federal Reserve Board is
required to weigh the expected benefits to the public, such as
greater convenience, increased competition or gains in
efficiency, against the risks of possible adverse effects, such
as undue concentration of resources, decreased or unfair
competition, conflicts of interest, or unsound banking practices. 
This consideration includes an evaluation of the financial and
managerial resources of the applicant, including its
subsidiaries, and any company to be acquired, and the effect of
the proposed transaction on those resources.

          To date, the Federal Reserve Board, by regulation, has
determined that, subject to expressed limitations, certain
activities are permissible for bank holding companies and their



<PAGE>


subsidiaries and may be engaged in upon notice to the Federal
Reserve Board without prior approval.  These permissible
activities include furnishing or providing services for the
internal operations of the bank holding company and its
subsidiaries, operating a safe deposit business, making and
servicing loans, operating an industrial bank, performing certain
trust company functions, acting as an investment or financial
advisor in certain capacities, leasing certain real or personal
property, making certain investments to promote community
development, providing certain data processing services,
performing certain insurance agency and underwriting functions,
owning, controlling and operating a savings association,
providing specified courier services, providing management
consulting advice to nonaffiliated banks and nonbank depository
institutions, selling certain money orders, United States savings
bonds and traveler's checks, performing appraisals of real and
personal property, arranging certain commercial real estate
equity financing, providing certain securities brokerage
services, underwriting and dealing in certain government
obligations and money market instruments, providing foreign
exchange advisory and transactional services, acting as a futures
commission merchant, providing investment advice on financial
futures and options on futures, providing consumer financial
counseling, providing tax planning and preparation services,
providing certain check guaranty services, operating a collection
agency and operating a credit bureau.

          The Federal Reserve Board has also determined that
certain other activities, including real estate brokerage and
syndication, land development, property management, management
consulting, underwriting of life insurance not sold in connection
with a credit transaction, and insurance premium funding are
improper activities for bank holding companies and their
subsidiaries.  In the future the Federal Reserve Board may take
additional actions adding and refusing to add particular
activities to the list of activities that the Federal Reserve
Board deems to be so closely related to banking or managing or
controlling banks as to be a proper incident thereto.  Certain
bank holding companies and their subsidiaries possess
"grandfather rights" giving them authority to engage in one or
more of the activities which are not generally permissible
because they were engaged in such activities prior to the
adoption of legislation restricting such activities.

          Under cross-guaranty provisions of the Federal Deposit
Insurance Act (the "FDIA"), bank subsidiaries of a bank holding
company are liable for any loss incurred (or reasonably
anticipated to be incurred) by the Bank Insurance Fund (the
"BIF"), the federal deposit insurance fund for banks, in
connection with the failure of any other bank subsidiary of the
bank holding company.  Liability under such cross-guaranty would
be junior to deposit liabilities and most secured obligations,


<PAGE>


but senior to obligations to shareholders and most obligations to
affiliates.  The Federal Deposit Insurance Corporation (the
"FDIC") has authority to prospectively waive the cross-guaranty
provision.  Currently the Bank is the only subsidiary of
Bancorporation.

          A bank holding company and its subsidiaries are
prohibited from engaging in certain tie-in arrangements in
connection with the extension of credit or the lease or sale of
any property or the furnishing of services.  Subsidiary banks of
a bank holding company are also subject to certain restrictions
imposed by the Federal Reserve Act on any extensions of credit to
the bank holding company or any of its subsidiaries, or
investment in the stock or other securities thereof, and on the
taking of such stocks or securities as collateral for loans.

          REGULATORY CAPITAL REQUIREMENTS.  The Federal Reserve
Board has promulgated "capital adequacy guidelines" for use in
its examination and supervision of bank holding companies.  A
holding company's ability to pay dividends and expand its
business through the acquisition of new banking subsidiaries can
be restricted if its capital falls below levels established by
these guidelines.  In addition, holding companies whose capital
falls below specified levels can be required to implement a plan
to increase capital.

          The Federal Reserve Board's capital adequacy guidelines
provide for the following types of capital:  Tier 1 capital (also
referred to as core capital), Tier 2 capital (also referred to as
supplementary capital), Tier 3 capital (consisting of short-term
subordinated debt that meets certain conditions and used only in
the measure of market risk, as discussed below) and Total
capital.  A bank holding company's Tier 1 capital generally
includes the following elements: common shareholders' equity
(excluding unrealized gain (loss) on securities available-for-sale),
qualifying noncumulative perpetual preferred stock and
related surplus, qualifying cumulative perpetual preferred stock
and related surplus (limited to a maximum of 25% of Tier 1
capital elements) and minority interests in the equity accounts
of consolidated subsidiaries.  Goodwill is generally excluded
from Tier 1 capital.  Most intangible assets also are deducted
from Tier 1 capital.  A bank holding company's Tier 2 capital
generally includes allowances for loan and lease losses (limited
to 1.25% of risk-weighted assets), most perpetual preferred stock
and any related surplus (noncumulative and cumulative, without
percentage limits), certain hybrid capital instruments, perpetual
debt and mandatory convertible debt securities, and certain
intermediate-term preferred stock and intermediate-term
subordinated debt instruments (to a maximum of 50% of Tier 1
capital excluding goodwill, but phased-out as the instrument
matures).  The maximum amount of supplementary capital that
qualifies as Tier 2 capital is limited to 100% of Tier 1 capital


<PAGE>


(net of goodwill).  For purposes of calculating the total
risk-based capital ratio, Total capital generally includes Tier 1
capital, plus qualifying Tier 2 capital, minus investments in
unconsolidated subsidiaries, reciprocal holdings of bank holding
company capital securities, certain deferred tax assets and other
deductions as determined by the Federal Reserve Board.

          The Federal Reserve Board issued a regulation that
limits the amount of intangible assets which may be included in
Tier 1 capital.  Under the regulation, mortgage servicing rights
("MSRs") and purchased credit card relationships ("PCCRs") would
be included in Tier 1 capital to the extent that, in the
aggregate, they do not exceed 50% of Tier 1 capital and, to the
further extent that PCCRs, individually, do not exceed 25% of
Tier 1 capital.  MSRs and PCCRs in excess of these limits, as
well as core deposit intangibles ("CDI") and all other identified
intangible assets, must be deducted in determining Tier 1
capital.  As of December 31, 1996, Bancorporation did not have
MSRs, PCCRs, CDIs or other identified intangible assets.

          The Federal Reserve Board's capital adequacy guidelines
require a bank holding company to satisfy a Tier 1 Leverage
Ratio, a total risk-based capital ratio and a Tier 1 risk-based
capital ratio.  Under the Tier 1 Leverage Ratio capital
guideline, a bank holding company must have and maintain Tier 1
capital in an amount equal to at least 3.0% of its average total
consolidated assets.  In general, average total consolidated
assets means the quarterly average total assets (net of the
allowance for loan and lease losses) reported on a bank holding
company's Consolidated Financial Statements (FR Y-9C Report),
minus goodwill and any other intangible assets or investments in
subsidiaries which are deducted from Tier 1 capital.  The 3.0%
minimum Tier 1 Leverage Ratio is considered the absolute minimum
amount of Tier 1 capital which the most highly rated bank holding
companies (those rated composite 1 under the BOPEC rating system
for bank holding companies) are required to maintain.  All other
bank holding companies must maintain a minimum Tier 1 Leverage
Ratio of 3.0% plus an additional cushion of at least 100 to 200
basis points.

          Under the Federal Reserve Board's capital adequacy
guidelines, a bank holding company must have and maintain a ratio
of Total capital to risk-weighted assets of 8.00%, and a ratio of
Tier 1 capital to risk-weighted assets of 4.00%.  The amount of a
bank holding company's risk-weighted assets is determined by
multiplying the balance sheet amount of each of the bank holding
company's consolidated assets by a specified risk-weight factor
of 0%, 20%, 50% or 100%, in accordance with the relative risk
level of the asset.  In determining risk-weighted assets, off-
balance sheet items, such as standby letters of credit, are
converted to an on-balance sheet credit equivalent amount by
multiplying the face amount of the off-balance sheet item by a


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credit conversion factor of 0%, 20%, 50% or 100%, in accordance
with the probability that the off-balance sheet item will become
a credit extended by the bank holding company.  In general,
intangible assets and other assets which are deducted in
determining Tier 1 capital and Total capital must also be
excluded from risk-weighted assets.

          The Federal Reserve Board has proposed to permit
portions of claims (including repurchase agreements)
collateralized by cash on deposit with the lending institution or
by securities issued or guaranteed by the U.S. Treasury, U.S.
government agencies, or the central governments in other OECD
countries to be eligible for a zero percent risk weight.  The
effect of this proposal is to allow banks and bank holding
companies to hold less capital for these types of collateralized
transactions.

          On September 6, 1996, the Federal Reserve Board amended
its credit risk-based capital standards to incorporate a measure
for market risk to cover all positions located in an
institution's trading account and foreign exchange and commodity
positions wherever located.  The new regulation applies to any
bank or bank holding company (i) whose trading activity equals
10% or more of its total assets or (ii) whose trading activity
equals $1 billion or more.  By January 1, 1998, each of these
institutions must use its own internal value-at-risk model to
measure its exposure to market risk and hold capital in support
of that exposure.  The regulation does not mandate a standardized
approach for measuring general market risk.  However, the
regulation does retain the standardized approach methodologies
for determining capital charges for specific risk, which an
institution must use as its basis for its specific risk charge
for debt and equity positions in its trading account.  The
regulation supplements the existing credit risk-based capital
standards by requiring an affected institution to adjust its
risk-based capital ratio to reflect market risk.  In measuring
market risk, institutions may use Tier 3 capital to meet the
market risk capital requirements.  Tier 3 capital is subordinated
debt that is unsecured, fully paid up, has an original maturity
of at least two years, is not redeemable before maturity without
the prior approval of the institution's supervisor, is subject to
a lock-in clause that prevents the issuer from repaying the debt
even at maturity if the issuer's capital ratio is, or with
repayment, would become, less than the minimum 8% risk-based
capital ratio, and does not contain and is not covered by any
covenants, terms or restrictions that may be inconsistent with
safe and sound banking practices.

          On December 31, 1996, Bancorporation was in compliance
with all of the Federal Reserve Board's capital guidelines.  On
such date, Bancorporation had a Tier 1 Leverage Ratio of 6.92%
(compared with a requirement of 4% to 5%), and a ratio of total


<PAGE>


capital to risk-weighted assets of 12.44% (compared with a
requirement of 8%) and a ratio of Tier 1 capital to risk-weighted
assets of 11.17% (compared with a requirement of 4%).   There can
be no assurance, however, that Bancorporation will remain in
compliance with regulatory capital requirements.  For additional
information on Bancorporation capital, see "Item 7.  Management's
Discussion and Analysis of Financial Condition and Results of
Operations--Financial Condition--Shareholders' Equity."

          LIMITATION ON INCURRED DEBT.  Bancorporation currently
has no plans to incur any indebtedness.  If Bancorporation
determines to do so in the future, it will be subject to the
general statutory and regulatory restrictions and, in addition,
to certain commitments made by it to the Federal Reserve Board at
the time Bancorporation received approval to become a bank
holding company.  One such commitment which remains in effect is
an agreement by Bancorporation that it will not incur debt
without the prior approval of the Federal Reserve Bank of New
York.  In the past, Bancorporation, with the approval of the
Federal Reserve Bank of New York, has incurred indebtedness for
the purpose of augmenting the Bank's capital to support growth.

          INTERSTATE BANKING AND BRANCHING.  Under the Riegle-Neal
Interstate Banking and Branching Efficiency Act of 1994 (the
"Riegle-Neal Act"), bank holding companies may acquire the stock
or substantially all of the assets of banks located in any state
regardless of whether such transaction is prohibited under the
laws of any state.  The Federal Reserve Board, however, may not
approve an interstate acquisition if as a result of the
acquisition the bank holding company would control more than 10%
of the total amount of insured deposits in the United States or
would control more than 30% of the insured deposits in the home
state of the acquired bank.  The 30% of insured deposits state
limit does not apply if the acquisition is the initial entry into
a state by a bank holding company or if the home state waives
such limit.

          Under the Riegle-Neal Act, individual states may
restrict interstate acquisitions in two ways.  First, a state may
prohibit an out-of-state bank holding company from acquiring a
bank located in the state unless the target bank has been in
existence for a specified minimum period of time (not to exceed
five years).  Second, a state may establish limits on the total
amount of insured deposits within the state which are controlled
by a single bank holding company (a "deposit cap"), provided that
such deposit limit does not discriminate against out-of-state
bank holding companies. 

          The Riegle-Neal Act now permits affiliated banks in
different states to act as agents for each other for purposes of
receiving deposits, renewing time deposits, closing loans,
servicing loans and receiving payments on loans and other


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obligations.  A bank acting as an agent for an affiliated bank is
not considered a branch of the affiliated bank.

          Beginning on June 1, 1997, the Riegle-Neal Act
authorizes interstate branching by a merger of banks with
different home states which results in a single bank with
branches in both states.  The Riegle-Neal Act gives states the
right to "opt out" and prohibit interstate mergers by passing
legislation before June 1, 1997 that expressly prohibits all
merger transactions with out-of-state banks.  The Riegle-Neal Act
also gives states the right to "opt in" and authorize early
interstate mergers by passing legislation that expressly permits
interstate merger transactions with all out-of-state banks.  The
Riegle-Neal Act authorizes banks to establish and operate a de
novo branch in a state (other than the bank's home state) only if
the host state "opts in" to authorize de novo interstate banking
by passing legislation that expressly permits all out-of-state
banks to establish de novo branches in the state.  As of March 1,
1997, approximately 43 states have opted into the Riegle-Neal
Act.  Only one state, Texas, has opted out.  The states of New
Jersey, New York, Connecticut, Pennsylvania, Delaware and
Maryland have opted into the Riegle-Neal Act, and of those
states, Connecticut, Pennsylvania, and Maryland permit de novo
interstate branching for banks located in any state which enacts
a reciprocal statute. 

          STATE BRANCHING LIMITATIONS

          In general, New Jersey law permits a bank, with prior
regulatory approval, to establish a full branch office, a
mini-branch office or a communications terminal branch office
anywhere in the State.  A bank, however, generally may not
establish a full branch office or a mini-branch office (except in
connection with a bank merger or an acquisition from a bank in
liquidation or in danger of liquidation) in a municipality, other
than in the municipality in which it maintains its principal
office, which has a population of less than 10,000 and in which
another banking institution maintains its principal office.  For
this purpose the principal office of a bank that is a subsidiary
of a bank holding company which controls two or more banking
institutions is deemed to be a branch office.

          FEDERAL BANK REGULATION

          GENERAL.  As a national bank, the Bank is subject to
regulation and examination primarily by the Office of the
Comptroller of the Currency (the "OCC").  The Bank is also
regulated by the Federal Reserve Board and the FDIC.  Regulation
by these agencies is designed to protect depositors of the Bank
rather than shareholders of Bancorporation.  The OCC has the
authority to issue cease and desist orders if it determines that
activities of the Bank represent unsafe and unsound banking


<PAGE>


practices or violations of law.  In addition, the OCC is
empowered to impose substantial civil money penalties for
violations of banking statutes and regulations.

          REGULATORY CAPITAL REQUIREMENTS.  The OCC has adopted
minimum capital requirements applicable to national banks which
are substantially similar to the capital adequacy guidelines
established by the Federal Reserve Board for bank holding
companies.  There are, however, technical differences in the
methodologies used to calculate the capital ratios. 

          On December 31, 1996, the Bank was in compliance with
all of the OCC's minimum capital requirements.  On such date, the
Bank had a Tier 1 Leverage Ratio of 6.82% (compared with a
requirement for the Bank of 4% to 5%), and a ratio of Total
capital to risk-weighted assets of 12.26% (compared with a
requirement of 8%), and a ratio of Tier 1 capital to
risk-weighted assets of 11.00% (compared with a requirement of
4%). 

          CLASSIFICATION OF BANKS.  Federal banking laws classify
financial institutions in one of the following five categories,
depending upon the amount of their capital: well-capitalized,
adequately capitalized, undercapitalized, significantly
undercapitalized or critically undercapitalized.  Under OCC
regulations, a bank is deemed to be (i) "well capitalized" if it
has a total risk-based capital ratio of 10% or greater, a Tier 1
risk-based capital ratio of 6% or greater and a Tier 1 leverage
ratio of 5% or greater (and is not subject to any order or
written directive specifying any higher capital ratio), (ii)
"adequately capitalized" if it has a total risk-based capital
ratio of 8% or greater, a Tier 1 risk-based capital ratio of 4%
or greater and a Tier 1 leverage ratio of 4% or greater (or a
Tier 1 leverage ratio of 3% or greater, if the bank has a CAMEL
rating of 1), (iii) "undercapitalized" if it has a total
risk-based capital ratio that is less than 8%, a Tier 1
risk-based capital ratio that is less than 4% or a Tier 1
leverage ratio that is less than 4% (or a Tier 1 leverage ratio
that is less than 3%, if the bank has a CAMEL rating of 1), (iv)
"significantly undercapitalized" if it has a total risk-based
capital ratio that is less than 6%, a Tier 1 risk based capital
ratio that is less than 3% or a Tier 1 leverage ratio that is
less than 3%, and (v) "critically undercapitalized" if it has a
Tier 1 leverage ratio that is equal to or less than 2%.  Federal
banking laws require the federal regulatory agencies to take
prompt corrective action against undercapitalized financial
institutions.  Under OCC regulations, the Bank was a well
capitalized institution as of December 31, 1996.

          DEPOSIT INSURANCE AND ASSESSMENTS.  The deposits of the
Bank are insured by the BIF administered by the FDIC, in general,
to a maximum of $100,000 per insured depositor.  Under FDIA and


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FDIC regulations, the Bank is required to pay annual assessments
to the FDIC for deposit insurance.  The FDIC has adopted a 
risk-based assessment system.  Under the risk-based assessment
system, BIF members pay varying assessment rates depending upon
the level of the institution's capital and the degree of
supervisory concern over the institution.  The assessment rates
are set by the FDIC semiannually.  The FDIC's assessment rates
through June 30, 1997 range from zero (0) cents to 31 cents per
$100 of insured deposits.  Institutions qualifying for the $0
assessment rate are no longer required to pay the minimum deposit
premium payment of $2,000 annually.  As of January 1, 1997, the
Bank's assessment rate was zero cents per $100 of insured
deposits.  The FDIC has authority to increase the annual
assessment rate if it determines that a higher assessment rate is
necessary to increase BIF's reserve ratio.  There is no cap on
the annual assessment rate which the FDIC may impose.

          In addition to any assessments that may be imposed by
the FDIC as described above, the Deposit Insurance Funds Act of
1996 provides for the imposition of annual assessments by the
Financing Corporation on Savings Association Insurance Fund-
assessable deposits and BIF-assessable deposits.  These
assessments are scheduled to remain in effect from January 1,
1997 through December 31, 1999.  As of January 1, 1997, the
annual assessment rate applicable to the Bank was approximately
1.29 basis points of its assessable deposits.

          INTEREST RATES.  The rate of interest a bank may charge
on certain classes of loans is limited by state and federal law. 
At certain times in the past, these limitations, in conjunction
with national monetary and fiscal policies that affect the
interest rates paid by banks on deposits and borrowings, have
resulted in reductions of net interest margins on certain classes
of loans.  Such circumstances may recur in the future, although
the trend of recent federal and state legislation has been to
eliminate restrictions on the rates of interest which may be
charged on some types of loans and to allow maximum rates on
other types of loans to be determined by market factors.
          
          LOANS TO ONE BORROWER.  In addition to limiting the
rate of interest chargeable by banks on certain loans, federal
law imposes additional restrictions on a national bank's lending
activities.  Under federal law the maximum amount that a national
bank may lend to one borrower (and certain related interests of
such borrower) generally is limited to 15% of the bank's
unimpaired capital and unimpaired surplus, plus an additional 10%
for loans fully secured by readily marketable collateral.  There
are certain exceptions to the general rule including loans fully
secured by government securities or deposit accounts in the bank. 
As of December 31, 1996, the Bank's lending limit under this
regulation was approximately $6,820,000.
          


<PAGE>



          PAYMENT OF DIVIDENDS.  The National Bank Act restricts
the payment of dividends by a national bank as follows:  (i) no
dividends may be paid if the bank has no undivided profits or
retained earnings then on hand; (ii) until the surplus fund of
the bank is equal to its capital stock, no dividends may be
declared unless there has been carried to the surplus fund not
less than one-tenth of the bank's net profits of the preceding
half-year period in the case of quarterly or semiannual
dividends, or not less than one-tenth of the net profits of the
preceding two consecutive half-year periods in the case of annual
dividends; and (iii) the approval of the OCC is required if
dividends declared by the bank in any year would exceed the total
of net profits for that year combined with retained net profits
for the preceding two years, less any required transfers to
surplus.  

          As of December 31, 1996, retained earnings of the Bank
of $6,942,000 were available for payment of dividends to
Bancorporation without regulatory approval.  For additional
information on the Bank's capital, see "Item 7. Management's
Discussion and Analysis of Financial Condition and Results of
Operations--Financial Condition--Shareholders' Equity."  

          COMMUNITY REINVESTMENT ACT.  On May 4, 1995, the
Federal Reserve Board, the FDIC and the OCC adopted regulations
relating to the Community Reinvestment Act (the "CRA").  The
purpose of the CRA regulations is to establish the framework and
criteria by which the bank regulatory agencies assess an
institution's record of helping to meet the credit needs of its
community, including low- and moderate-income neighborhoods, and
to provide that the agencies' assessment shall be taken into
account in reviewing certain applications.  The regulations seek
to emphasize an institution's performance rather than the
process, to promote consistency in evaluation of institutions,
and to eliminate unnecessary reporting burdens.  The regulations
replace the previous twelve assessment factors for large banks
with three tests: (i) a lending test, (ii) a service test, and
(iii) an investment test.  While documentation requirements have
been substantially reduced, the safe harbors from CRA protest
have also been eliminated.

          OTHER REGULATORY LIMITATIONS.  Bancorporation and the
Bank are "affiliates" within the meaning of the Federal Reserve
Act.  As such, the amount of loans or extensions of credit which
the Bank may make to Bancorporation or to third parties secured
by securities or obligations of Bancorporation are substantially
limited by the Federal Reserve Act and the FDIA.  Such acts
further restrict the range of permissible transactions between a
bank and an affiliated company.  A bank and its subsidiaries may
engage in certain transactions, including loans and purchases of
assets, with an affiliated company only if the terms and
conditions of the transaction, including credit standards, are


<PAGE>



substantially the same as, or at least as favorable to the bank
as, those prevailing at the time for comparable transactions with
non-affiliated companies or, in the absence of comparable
transactions, on terms and conditions that would be offered to
non-affiliated companies.

          The Bank is also authorized to invest in a service
corporation that can offer the same services as the banking
related services that bank holding companies are authorized to
provide.  However, prior regulatory approval must generally be
obtained prior to making such an investment or performing such
services.

          BANKING ACTIVITIES.  The investments and activities of
the Bank are subject to substantial regulation by the OCC and the
FDIC, including without limitation investments in subsidiaries,
investments for their own account (including limitations on
investments in junk bonds and equity securities), investments in
loans, loans to officers, directors and affiliates, security
requirements, truth-in-lending, community reinvestment, the types
of interest bearing deposit accounts which they can offer, trust
department operations, brokered deposits, audit requirements,
issuance of securities, branching and mergers and acquisitions.

          MONETARY POLICY AND ECONOMIC CONDITIONS.  The principal
sources of funds essential to the business of banks and bank
holding companies are deposits, shareholders' equity, and
borrowed funds.  The availability of these various sources of
funds and other potential sources such as preferred stock or
commercial paper and the extent to which they are utilized depend
on many factors, the most important of which are the monetary
policies of the Federal Reserve Board and the relative costs of
different types of funds.

          An important function of the Federal Reserve Board is
to regulate the national supply of bank credit in order to combat
recession and curb inflationary pressures.  Among the instruments
of monetary policy used by the Federal Reserve Board to implement
these objectives are open market operations in U.S. Government
securities, changes in the discount rate on bank borrowings, and
changes in reserve requirements against bank deposits.

          The Bank is subject to regulations issued by the
Federal Reserve Board which require depository institutions to
maintain non-interest-bearing reserves against their transaction
accounts and non-personal time deposits.  These regulations
currently require depository institutions to maintain reserves
equal to 3% of transaction accounts up to $49.3 million plus 10%
(subject to adjustment by the Federal Reserve Board between 8%
and 14%) of the total over $49.3 million.  In addition, reserves,
subject to adjustment by the Federal Reserve Board between 0% and
9%, must be maintained on non-personal time deposits.  This


<PAGE>



reserve percentage is currently 0%.  Depository institutions may
designate and exempt up to $4.4 million of reservable liabilities
from the above reserve requirements.  Because these reserves must
generally be maintained in cash or non-interest-bearing accounts,
the effect of the reserve requirements is to increase the cost of
funds to depository institutions.  As of December 31, 1996, the
Bank was required to maintain a reserve balance of $9.4 million.

         Substantially all of the restrictions on the maximum
interest rates banks are permitted to pay on deposits have been
removed, although banks are still prohibited from paying interest
on demand deposits.  Consequently, banks and thrift organizations
are substantially free to pay interest at any rate.  Deregulation
has increased competition among such institutions for attracting
deposits and has resulted in an overall increase in such
institutions' cost of funds.

         The monetary policies of the Federal Reserve Board have
had a significant effect on the operating results of commercial
banks in the past and are expected to continue to do so in the
future.  In view of continuing changes in regulations affecting
commercial banks and other actions and proposed actions by the
Federal government and its monetary and fiscal authorities,
including proposed changes in the structure of banking in the
United States and general economic conditions, no prediction can
be made as to future changes in interest rates, credit
availability, deposit levels, loan demand, or the overall
performance of banks generally and of the Bank and Bancorporation
in particular.

         The references in the foregoing discussion to various
aspects of statutes and regulations are merely summaries which do
not purport to be complete and which are qualified in their
entirety by reference to the actual statutes and regulations.

ITEM 2.  PROPERTIES.

         The main offices of both the Bank and Bancorporation
are located at 905 Broad Street, Newark, New Jersey 07102.  The
building, which is owned by the Bank, is a two-story structure
constructed in 1960.  It has approximately 18,000 square feet of
usable office space, which currently are used for the Bank's
operations.  During 1987, a wholly-owned subsidiary of the Bank
purchased the five-story (approximately 45,000 square feet)
Western Union Building at 909 Broad Street in Newark, New Jersey,
adjacent to its main office.  During 1994, the Bank and
Bancorporation increased the amount of space available for the
Bank's use in this building from approximately 55% to 81% of the
building.  Approximately 19% of the building is leased to
nonaffiliated companies.


<PAGE>




         The Bank currently has fourteen branch banking
facilities as described below in addition to its main location:

                             Approximate         Expiration
    Location                 Square Feet         Date of Lease

Plaza Banking Center            5,092            December 31,
745 Broad Street                                 1998 /1/
Newark, New Jersey

Ironbound Banking Center        4,100            February 28,
7 Wheeler Point Road                             1999 /1/
Newark, New Jersey

North Newark Banking Center     3,500            December 31, 
466 Bloomfield Avenue                            1997 /1/
Newark, New Jersey

Millburn Banking Center         2,600            March 31, 2001
225 Millburn Avenue                                   
Millburn, New Jersey

Gateway III Banking Center      2,076            September 7,
100 Mulberry Street                              1999 /1/
Newark, New Jersey

North Arlington Banking Center  1,700            October 7,
65 River Road                                    1997
North Arlington, New Jersey

Jackson Street Banking Center  10,900            Owned
123-133 Jackson Street 
Newark, New Jersey

Bayway Banking Center           3,700            April 30,
1000 South Elmora Avenue                         2006 /2/
Elizabeth, New Jersey

Livingston Banking Center       3,450            November 30,
30 W. Mt. Pleasant Avenue                        2001 /3/
Livingston, New Jersey

Perth Amboy Banking Center      3,400            August 31,
Convery Plaza, Route 35                          1997 /4/
Perth Amboy, New Jersey

East Orange Central             6,070            Owned
  Banking Center                     
554 Central Avenue
East Orange, New Jersey


<PAGE>




Elizabeth Banking Center        3,190            Owned
826 Elizabeth Avenue
Elizabeth, New Jersey

Kearny Banking Center             700            March 31,
180 Schuyler Ave.                                2000 /5/
Kearny, New Jersey

East Ferry Office                 800            November 30,
290 Ferry Street                                 2000 /2/
Newark, New Jersey 
_______________________

/1/ The Bank has the option to extend the term of the lease for
    one additional five year period.

/2/ The Bank has the option to extend the term of the lease for
    up to four additional five year periods.

/3/ The Bank has the option to extend the term of the lease for
    up to one additional five year period and one additional ten
    year period.

/4/ The Bank has the option to extend the term of the lease for
    three additional five year periods.

/5/ The Bank has the option to extend the term of the lease for
    two additional five year periods.

         The Bank also owns an 18,000 square foot building
located at 465 Bloomfield Avenue, Bloomfield, New Jersey.  Under
a lease agreement dated August 1993 between the Bank and EDS, all
of the space in the Bloomfield Avenue building is being leased to
EDS, which uses the space to provide data processing services,
related professional services, information processing and related
outsourcing services to the Bank and other financial
institutions.
         
         During 1995, the Bank opened a new full-service banking
center in Kearny, New Jersey and converted its Gateway III
Banking Center to a fully electronic branch, featuring multiple
ATM's and a video banking link. During 1996, the Bank opened a
new full-service banking center in Newark, New Jersey.

         Bancorporation neither owns nor leases any property.


<PAGE>



ITEM 3.  LEGAL PROCEEDINGS.

         Neither Bancorporation nor the Bank is involved in any
material pending legal proceedings, other than routine litigation
incidental to their respective businesses.

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

         No matter was submitted to a vote of Bancorporation's
shareholders during the fourth quarter of the year ended December
31, 1996.
         
ITEM 4A.  EXECUTIVE OFFICERS OF THE REGISTRANT.

         Executive officers of Bancorporation and of the Bank
are elected annually and serve until their successors are elected
and qualified at the next annual meeting of the directors of the
respective corporations.  The following table sets forth
information with respect to the executive officers of
Bancorporation and of the Bank.

                        Position with
                        Bancorporation
                        and Bank and Year        Principal
    Name           Age  First Elected            Occupation /1/

Donald M. Karp     60   Chairman of              Position with
                        the Board of             Bancorporation
                        Bancorporation (1985)    and the Bank/2/
                        and the Bank (1985);
                        Chief Executive Officer
                        of Bancorporation (1991)
                        and the Bank (1991);
                        Vice Chairman of the
                        Board of Bancorporation
                        (1981-1985) and the
                        Bank (1978-1985);
                        Director (1972)

John A. Dorman     58   President of             Position with
                        Bancorporation (1992)    Bancorporation
                        and the Bank (1992);     and the Bank/3/
                        Director (1992)



<PAGE>



Fred S. Campo      47   Senior Vice President    Position with
                        of the Bank (1986);      Bancorporation
                        Secretary of             and the Bank/4/
                        Bancorporation (1982)
                        and the Bank (1991)

Fred Perry, Jr.    67   Senior Vice              Position with
                        President of             the Bank
                        the Bank (1978)

Peter Kenny        51   First Vice               Position with
                        President of             the Bank /5/
                        the Bank (1991);
                        Senior Vice 
                        President of the
                        Bank (1992)

James Boyle        46   Treasurer of             Position with
                        Bancorporation;          Bancorporation
                        Vice President and       and the Bank/6/
                        Comptroller of the 
                        Bank (1988); Senior
                        Vice President of the
                        Bank (1992)

Ellen Rogoff       47   First Vice President     Position with
                        of the Bank (1993);      the Bank /7/
                        Senior Vice President
                        of the Bank (1994)
___________________

/1/ Unless otherwise indicated, each of the persons listed has
    been employed in the indicated principal occupation during
    the last five years.

/2/ Mrs. Donald M. Karp is the niece of Stanley J. Lesnik and
    the daughter of Harriet M. Alpert, a principal shareholder
    of Bancorporation.

/3/ Prior to joining Bancorporation and the Bank, Mr. Dorman was
    an executive vice president of Chemical Bank New Jersey
    where he managed the Statewide Commercial Lending division. 
    For the two years prior to the merger in 1989 of Horizon
    Bank Corp. and Chemical Bank, Mr. Dorman served as President
    and Chief Executive Officer of Chemical New Jersey


<PAGE>


    Corporation, Chemical Banking Corporation's loan production
    office in New Jersey.

/4/ Mr. Campo joined the Bank in December 1978 as an internal
    auditor.  In 1982, Mr. Campo became secretary of
    Bancorporation.   In 1986, he was promoted to senior vice
    president of the Bank.  In 1991, he became secretary of the
    Bank.

/5/ For at least five years prior to joining Bancorporation, Mr.
    Kenny was executive vice president and secretary of United
    Jersey Bank, Northwest.

/6/ Prior to joining Bancorporation, from April 1982 to December
    1988 Mr. Boyle was a vice president and project director at
    National Westminister Bancorporation NJ (formerly First
    Jersey National Bank).

/7/ For the three years prior to joining the Bank, Ms. Rogoff
    was Manager of Human Resources for Bristol Myers.  For at
    least two years prior to joining Bristol Myers, Ms. Rogoff
    was Manager of Human Resources for Action Tungsram.

         There are no arrangements or understandings between any
of the executive officers or any other persons pursuant to which
any of the executive officers have been selected to their
respective positions.


                             PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
         SHAREHOLDER MATTERS

         Shares of the Common Stock of Bancorporation have been
traded under the symbol BNBC on the NASDAQ National Market System
since June 2, 1988, and in the over-the-counter market prior to
this date.  The following table sets forth the range of high and
low closing sale price quotations per share for Bancorporation's
Common Stock as reported by NASDAQ, together with cash dividends
per share paid on Bancorporation's Common Stock, during the
periods indicated. 

         The market price information does not include retail
markups, markdowns or commissions, but is based on actual
transactions.


<PAGE>




Bancorporation                 High*     Low*    Dividend*

1996     1st Quarter         $10 5/8   $8 3/8    $.06
         2nd Quarter          10 5/8    9 1/2     .06
         3rd Quarter          10        9 1/8     .07
         4th Quarter          12 1/4    9 1/2     .08

1995     1st Quarter           $7 1/2  $6 1/8    $.03
         2nd Quarter            9 1/8   6 3/8     .04
         3rd Quarter            9 3/4   8         .05
         4th Quarter           12       8 1/8     .05

____________
*   The market prices and dividends have been restated to give
    effect to the 10% stock dividend which was distributed
    October 3, 1996.

         As of January 31, 1997, there were 4,667,188 shares of
Bancorporation's Common Stock outstanding and approximately 900
holders of record of such stock.

ITEM 6.  SELECTED FINANCIAL DATA.

         The following table sets forth certain historical
financial data with respect to Bancorporation on a consolidated
basis.  The information contained in this table should be read in
conjunction with Bancorporation's historical Consolidated
Financial Statements and related notes thereto included elsewhere
in this Report.

<TABLE>


                                                           December 31,
                              1996             1995             1994            1993              1992
                                                   (Dollars in thousands)
<CAPTION>

<S>                        <C>               <C>                <C>             <C>                <C>
Selected Consolidated 
      Statements of 
      Condition Information
Total assets               $533,615          $481,185           $428,630        $438,532           $405,634
Loans, gross                287,364           267,419            267,422         265,920            256,293
Investment securities       159,214           116,212            110,933         102,165             99,654
Total deposits              485,073           429,681            391,466         406,066            378,699
Short-term borrowings 
   and long-term debt         1,000               782                177             342              3,660
Shareholders' equity         38,358            34,529             30,266          27,421             18,975
      
Consolidated Statements of Income
      Information
Interest income           $ 35,162          $ 33,398           $ 29,795        $ 28,313            $ 30,441
Interest expense            11,818            10,082              7,464           8,082              11,817 
Net interest income         23,344            23,316             22,331          20,231              18,624 
Provision for possible 
      loan losses            1,350               720                450             900               2,435 
Net interest income 
      after provision
      for possible loan 
      losses                21,994            22,596             21,881          19,331              16,189 
Non-interest income          6,556             4,491              3,649           4,023               4,405
Non-interest expense        19,849            19,536             20,073          19,813              17,590 
Provision for income 
      taxes                  3,428            3,131                 768           1,491               1,311 

</TABLE>


<PAGE>

<TABLE>


                                                                         December 31,
                                       1996              1995               1994            1993            1992
<CAPTION>                                                             (Dollars in thousands)
<S>                                   <C>             <C>               <C>               <C>               <C>
Net income before cumulative 
      effect of a change in 
      accounting principle            $ 5,273         $ 4,420           $4,689            $ 2,050          $ 1,693 
Cumulative effect of a 
      change in accounting 
      principle                             0                0               0              1,086                0 
Net income                            $ 5,273         $ 4,420          $ 4,689            $ 3,136            1,693 
Per Share Data 
Net income per common share
      Primary
         Before cumulative 
         effect of a change
         in accounting 
         principle                      $1.13            $1.16           $1.29             $0.45             $0.52 
      Cumulative effect of 
         a change in
         accounting principle            0.00            0.00             0.00              0.35              0.00 
      Primary earnings per 
         common share                   $1.13           $1.16             $1.29            $0.80             $0.52 
      Fully diluted
         Before cumulative 
         effect of a change
         in accounting 
         principle                      $1.10            $0.93            $1.00            $0.46             $0.52 
      Cumulative effect of 
         a change in
         accounting principle            0.00             0.00             0.00             0.24              0.00 
      Fully diluted earnings 
         per common share               $1.10            $0.93            $1.00            $0.70             $0.52 
Cash dividends per 
      common share                       0.28             0.17             0.16             0.00              0.00 
Book value per 
      common share                       8.21             7.40              7.15            6.26              5.89 
Dividend payout ratio                   24.58%           26.58%            19.27%          18.05%             0.00%
Weighted average 
      number of common shares
      outstanding (in thousands):
         Primary                        4,650            3,302             3,168           3,121             3,093 
         Assuming full 
          dilution                      4,791            4,735             4,676           4,553             3,216 

FINANCIAL RATIOS
Return on average assets                 1.05%           0.97%             1.04%           0.48%             0.39%
Return on average 
      shareholders' equity              14.58           13.52             16.16            7.83              9.27 
Average equity to 
      average assets                     7.20            7.14              6.44            6.12              4.24 
Earnings to fixed 
      charges /1/                        1.74            1.71              1.68            1.30              1.25 
Net interest margin                      5.05            5.59              5.41            5.12              4.68 
Net interest spread                      4.33            4.88              4.92            4.55              4.05 

ASSET QUALITY RATIOS
Non-performing loans as 
      a % of gross loans                 3.39%           3.82%             3.63%           7.72%             7.57%
Non-performing loans as 
      a % of total assets                1.82             2.12              2.26            4.68             4.79 
Allowance for possible 
      loan losses as a
      % of gross loans                   2.97             2.77              2.84            4.23             4.94 
Allowance for possible 
      loan losses as a % of
      non-performing loans              87.65           72.47            78.32              54.81           65.21 
Net chargeoffs as a % 
      of average gross loans             0.08            0.35             1.56               0.90            0.67 
Non-performing assets as 
      a % of loans and OREO              5.03            6.00             5.81              10.03           10.98 

CAPITAL RATIOS
Leverage capital                         6.92%           7.17%            7.00%              6.23%           4.34%
Tier 1 capital to total 
      risk-weighted assets              11.17           10.58             9.87               9.16            6.55 
Total capital to total 
      risk-weighted assets              12.44           11.85            11.13              10.45            7.84 


</TABLE>


/1/   The ratio of earnings to fixed charges is computed by dividing the sum of
      income before taxes, fixed charges and preferred stock dividends by the
      sum of fixed charges and preferred stock dividends.  Fixed charges
      represent interest expense and payment of debt.



<PAGE>



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

EXCEPT FOR THE HISTORICAL INFORMATION CONTAINED HEREIN, THE
STATEMENTS MADE IN THIS REPORT ON FORM 10-K ARE FORWARD-LOOKING
STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES. 
BANCORPORATION'S ACTUAL RESULTS, FINANCIAL CONDITION OR BUSINESS
COULD DIFFER MATERIALLY FROM ITS HISTORICAL RESULTS, FINANCIAL
CONDITION OR BUSINESS, OR THE RESULTS OF OPERATIONS, FINANCIAL
CONDITION OR BUSINESS CONTEMPLATED BY SUCH FORWARD-LOOKING
STATEMENTS.  FACTORS THAT COULD CAUSE OR CONTRIBUTE TO SUCH
DIFFERENCES INCLUDE, BUT ARE NOT LIMITED TO, THOSE DISCUSSED
BELOW UNDER THE CAPTION "FACTORS THAT MAY AFFECT FUTURE RESULTS
OF OPERATIONS, FINANCIAL CONDITION OR BUSINESS," AS WELL AS THOSE
DISCUSSED ELSEWHERE IN BANCORPORATION'S REPORTS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION.

          The following discussion and analysis is intended to
provide information about the financial condition and results of
operations of Broad National Bancorporation and its subsidiaries
on a consolidated basis and should be read in conjunction with
the Consolidated Financial Statements and their related notes. 
As used in the following discussion, the term "Company" refers to
Broad National Bancorporation and its subsidiaries on a
consolidated basis; the term "Bank" refers to Broad National Bank
and its subsidiaries on a consolidated basis; and the term
"Bancorporation" refers to Broad National Bancorporation on a
parent company only basis.  When necessary, reclassifications
have been made to prior years' data throughout the following
discussion and analysis for purposes of comparability with 1996
data.

                             SUMMARY

          The Company recorded net income of $5,273,000 or $1.10
per fully diluted common share in 1996, compared to net income of
$4,420,000 or $0.93 per fully diluted common share in 1995 and
net income of $4,689,000 or $1.00 per fully diluted common share
in 1994.  Net income in 1994 included tax benefits of $1,500,000
as well as a one-time recovery of $875,000 ($578,000 tax
effected) of legal expenses in conjunction with an insurance
settlement.

          The per-share data for 1995 and 1994 have been restated
to reflect the effects of the 10% stock dividend declared
September 20, 1996 and distributed October 3, 1996.

          An improvement in non-interest income, particularly the
increase in service charges on deposit accounts resulting from a
more consistent collection of fee income for services provided,
is the primary reason for the increase in net income for 1996 as
compared to 1995.


<PAGE>



          An improved net interest margin, an increase in non-
interest income and a decline in non-interest expense contributed
to the increase in income, before income taxes, for 1995 as
compared to 1994.  The increase in income tax expense offset
these improvements and resulted in the overall decrease of net
income for 1995 as compared to 1994.

          The Company's return on average assets was 1.05% for
1996, 0.97% for 1995 and 1.04% for 1994.  The Company's return on
average shareholders' equity was 14.58% for 1996, 13.52% for 1995
and 16.16% for 1994.

          The Company's total assets increased $52,430,000 or
10.9% in 1996 following an increase of $52,555,000 or 12.3% in
1995.  Total deposits increased $55,392,000 or 12.9% in 1996
following an increase of $38,215,000 or 9.8% in 1995.  Total
loans, net of the allowance for possible loan losses and unearned
income, increased $18,857,000 or 7.26% in 1996 following growth
of $282,000 or 0.11% in 1995.

                      RESULTS OF OPERATIONS 

NET INTEREST INCOME

          Net interest income, the primary source of earnings for
the Company, is the difference between interest and fees earned
on loans and other earning assets, and interest paid on deposits
and other interest bearing liabilities.  Earning assets include
loans, investment securities and federal funds sold.  Interest
bearing liabilities include savings, interest bearing demand and
time deposits, and short-term borrowings and long-term debt.

          The following table shows the Company's consolidated
average balance of assets, liabilities, and shareholders' equity
as well as the amount of interest income or interest expense and
the average rate for each category of interest-earning assets and
interest-bearing liabilities.  Non-accrual loans are included in
average loans and interest on loans includes loan fees which are
not material.  Nontaxable income from investment securities and
loans is presented on a tax-equivalent basis assuming a 34% tax
rate.


<PAGE>

<TABLE>

                                    NET INTEREST INCOME

                            1996                    1995                     1994
                           Average     Interest  Average   Average      Interest    Average    Average       Interest   Average
                           Balance     and Fees     Rate   Balance      and Fees     Rate      Balance       and Fees    Rate
                                                                (Dollars in Thousands)

<CAPTION>

<S>                        <C>         <C>       <C>       <C>           <C>          <C>        <C>          <C>        <C>
ASSETS

Federal funds sold         $ 48,201    $ 2,567   5.24%     $ 38,383      $ 2,253      5.87%      $ 44,509     $1,836     4.13%
Investment Securities
  Securities         
    held-to-
     maturity /1/            75,403      4,745   6.29        87,128        5,154      5.92         83,861      4,588     5.47
  Securities 
    available-for-sale       61,948      3,689   5.95        27,029        1,682      6.22         23,548      1,257     5.34
Total investment
  securities                137,351      8,434   6.14 /2/   114,157        6,836      5.99 /2/    107,409      5,845     5.44/2/
Loans 
  Mortgage                  186,717     16,188   8.67       179,371       16,425      9.16        169,128    14,741      8.72
  Installment                15,083      1,460   9.68        11,328        1,125      9.93          9,251       870      9.40
  Commercial                 75,459      6,485   8.59        74,248        6,691      9.01         82,388     6,417      7.79
  States and political
  subdivisions /1/              756         88  11.64         1,148          146     12.72          1,286       154     11.98
  Total loans               278,015     24,221   8.11 /2/   266,095       24,387      9.16 /2/    262,053    22,182      8.46/2/
  Total interest
  earning assets            463,567    $35,222   7.60%/2/   418,635      $33,476      8.00%/2/    413,971   $29,863      7.21%/2/
Less-Allowance for 
  possible loan 
  losses                      7,869                           7,558                                 9,691
All other assets             46,517                          46,749                                46,336
Total assets               $502,215                       $ 457,826                             $ 450,616

LIABILITIES AND SHAREHOLDERS' EQUITY

Interest bearing deposits
  Savings and interest 
   bearing demand 
   deposits                $222,912     $4,899   2.20%     $221,749       $4,900      2.21%      $248,752   $ 5,018      2.02%
  Time deposits:
   Under $100,000            84,077      4,222   5.02        78,511        3,973      5.06         63,118     1,949      3.09
   Over $100,000             52,891      2,639   4.99        20,279        1,040      5.13         13,875       491      3.54
  Total interest 
     bearing
     deposits               359,880     11,760   3.27       320,539        9,913      3.09        325,745     7,458      2.29
Short-term borrowings         1,149         58   4.97         2,808          169      6.02            275         6      2.18
Total interest bearing
  liabilities               361,029    $11,818   3.27%      323,347      $10,082      3.12%       326,020    $7,464      2.29%
Other liabilities             7,831                           6,516                                 5,905
Demand deposits              97,197                          95,264                                89,683
Shareholders' equity         36,158                          32,699                                29,008
Total liabilities and
shareholders' equity       $502,215                        $457,826                              $450,616
NET INTEREST INCOME                    $23,404                           $23,394                            $22,399
  NET INTEREST SPREAD                           4.33%                                 4.88%                             4.92%
NET INTEREST MARGIN                             5.05%/3/                              5.59%/3/                          5.41%/3/


</TABLE>

     (1)  Interest income for investments in states and political
          subdivisions include tax-equivalent adjustments at a
          34% rate.
     (2)  Average rates reflect the tax-equivalent adjusted
          yields on non-taxable investments and loans. 
     (3)  Represents the difference between interest earned and
          interest paid, divided by total interest-earning
          assets.

RATE/VOLUME ANALYSIS OF NET INTEREST INCOME

          The effect of changes in average balance and rate from
the corresponding prior period on interest income, interest
expense and net interest income for the years ended December 31,
1996 and 1995 is set forth below.  The effect of a change in
average balance has been determined by applying the average rate
for the earlier period to the change in average balance for the
later period, as compared with the earlier period.  The effect of
a change in the average rate has been determined by applying the
average balance for the earlier period to the <PAGE> change in average
rate for the later period, as compared with the earlier period. 
The variances attributable to simultaneous balance and rate
changes have been allocated in proportion to the relationship of
the dollar amount of change in each category.

<TABLE>


                                  1996 Compared with 1995                         1995 Compared with 1994
                                    Increase (Decrease)                            Increase (Decrease)
                                     Due to a Change in                             Due to a Change in

                           Average         Average                         Average        Average
                           Balance          Rate             Total         Balance          Rate           Total
                                                           (Dollars in Thousands)

<CAPTION>

<S>                         <C>            <C>            <C>            <C>                <C>            <C>
Interest earned on:
  Loans                     $1,073         $(1,239)        $ (166)       $ 438              $1,767         $2,205 
  Investment securities      1,421             177          1,598          381                 610            991 
  Federal funds sold           578            (264)           314         (288)                705            417 
  Total interest income     $3,072         $(1,326)        $1,746        $ 531              $3,082         $3,613 
Interest paid on: 
  Savings and interest
     bearing demand 
     deposits               $    1         $    (2)        $   (1)       $(657)              $ 539          $(118)
  Time deposits:
    Under $100,000             282             (33)           249          568               1,456          2,024 
    Over $100,000            1,673             (74)         1,599          278                 271            549 
  Short-term borrowings        (87)            (24)          (111)         136                  27            163 
  Total interest 
     expense                $1,869         $  (133)        $1,736        $ 325              $2,293         $2,618 
Change in net 
     interest income        $1,203         $(1,193)        $   10        $ 206              $  789         $  995 
Percent increase in 
  net interest income 
  over the prior period                                      0.04%                                           4.44%

</TABLE>


         Total tax equivalent interest income of $35,222,000 for
1996 represents an increase of $1,746,000 or 5.2% over total tax
equivalent interest income of $33,476,000 for 1995.  This
improvement is primarily due to an increase of $44,932,000 in the
average balance of interest earning assets for 1996 as compared
to 1995.  The largest increase in average balances is reflected
in total investment securities, for which the average balance of
$137,351,000 for 1996 is $23,194,000 higher than 1995.  The
average balances of total loans and federal funds sold for 1996
as compared to 1995 increased $11,920,000 and $9,818,000,
respectively.  The overall increase in the average balance of
total interest earning assets contributed an additional
$3,072,000 to total tax equivalent interest income for 1996 as
compared to 1995.  However, this increase was partially offset by
a decrease of $1,326,000 in total tax equivalent interest income
for 1996 as compared to 1995, resulting from a decline of 40
basis points in the average rate earned on interest earning
assets.  Decreases in the federal funds rate and the prime rate
are the primary reasons for the decline in the average rates
earned on total interest earning assets.

         Total interest expense of $11,818,000 for 1996 was
$1,736,000 or 17.2% higher than 1995.  The cost of total interest
bearing liabilities increased to 3.27% for 1996 as compared to
3.12% for 1995.  An increase of $37,682,000 in total interest
bearing liabilities, and a change in the mix of interest bearing
liabilities contributed to the increase in total interest expense
for 1996 as compared to 1995.  Total <PAGE> average time deposits of
$136,968,000 for 1996 were $38,178,000 or 38.7% higher than 1995
total average time deposits.  This increase in average time
deposit balances increased 1996 interest expense by $1,955,000 as
compared to 1995 interest expense.  The increase in the average
balance of total time deposits also resulted in higher cost time
deposits representing 37.9% of total interest bearing liabilities
for 1996 as compared to 30.6% of total interest bearing
liabilities for 1995.  This change in the mix of interest bearing
liabilities contributed to the increase in the cost of interest
bearing liabilities to 3.27% for 1996 as compared to 3.12% for
1995.

         Tax equivalent net interest income for 1996 was $10,000
or .04% higher than 1995 tax equivalent net interest income.  The
decline in the average rate on interest earning assets and the
increase in the volume of interest bearing liabilities,
particularly higher cost time deposits, offset the increased
interest income which resulted from the increased volume of
interest earning assets.

         During 1995, total interest income, on a tax equivalent
basis, increased $3,613,000 or 12.1% compared to 1994.  The mix
of average interest earning assets changed slightly for 1995 as
compared to 1994.  Average federal funds sold declined to 9.2% of
average interest earning assets, as compared to 10.8% for 1994,
while total investment securities increased to 27.3% of average
interest earning assets for 1995 as compared to 25.9% for 1994. 
Total loans remained relatively unchanged, representing 63.5% of
average interest earning assets for 1995, as compared to 63.3%
for 1994.  The increase of $3,613,000 in total interest income
for 1995 as compared to 1994 was primarily attributable to an
increase of 79 basis points in the average rate earned on total
average interest earning assets, and to a lesser extent, an
increase of $4,664,000 in total average interest earnings assets. 
An increase of $4,042,000 in the average balance of loans
combined with an increase of 70 basis points in the average rate
earned on loans to result in an increase of $2,205,000 in
interest income earned on loans.  Similarly, an increase of
$6,748,000 in the average balance of investment securities
combined with a 55 basis point increase in the average rate
earned on investment securities to result in an increase of
$991,000 in interest income earned on investment securities. 
Interest income earned on federal funds sold increased $417,000,
primarily as the result of an increase of 174 basis points in the
average rate earned on federal funds sold, which increase was
partially offset by a decrease of $6,126,000 in the average
balance of federal funds sold.

         Total interest expense of $10,082,000 for 1995 was
$2,618,000 or 35% higher than 1994.  The increase in interest
expense was primarily attributable to an increase in the average
rates paid on interest bearing liabilities, and to a lesser
extent due to the change in the mix of interest bearing
liabilities.  The average rate paid for interest bearing
liabilities during 1995 was 83 basis points higher than 1994,
with the largest increase in rates reflected in time deposits and
short-term borrowings.  In addition to the increase in average
rates, the average balance of relatively higher costing time
deposits and short- <PAGE> term borrowings increased during 1995. 
Average rates on time deposits under $100,000 were 197 basis
points higher for 1995 as compared to 1994, while average rates
on time deposits over $100,000 were 159 basis points higher for
1995 than for 1994.  The average rate on short-term borrowings
for 1995 was 384 basis points higher than 1994.  The increase in
the average rate paid on all interest bearing liabilities was
responsible for an increase of $2,293,000 in total interest
expense.  Additionally, increases in the average balance of time
deposits and short-term borrowings contributed to an additional
$325,000 increase in total interest expense for 1995 as compared
to 1994.

         Tax equivalent net interest income for 1995 increased
$995,000 or 4.4% from 1994, and the net interest margin for 1995
was 18 basis points higher than that for 1994.  The increase is
primarily attributable to the fact that average rates earned on
interest earning assets increased more quickly than rates paid on
interest bearing liabilities.

PROVISION FOR POSSIBLE LOAN LOSSES

         In determining the provision for possible loan losses,
management considers historical loan loss experience, changes in
composition and volume of the portfolio, the level and
composition of non-performing loans, the adequacy of the
allowance for possible loan losses, and prevailing economic
conditions.  The provision for possible loan losses was
$1,350,000, $720,000 and $450,000 for 1996, 1995 and 1994,
respectively.  The increase in the provision for possible loan
losses during 1996 was primarily due to the increase in loans
outstanding, as well as management's efforts to address specific
problem loans and improve the Company's asset quality ratios.

         Actual net loan charge-offs were $221,000 or .08% of
average total loans, $920,000 or .35% of average total loans and
$4,100,000 or 1.56% of average total loans for 1996, 1995 and
1994, respectively.  Included in the net charge-off figure of
$4,100,000 for 1994 are charge-offs for approximately $2,696,000
related to the sale of $5,651,000 of troubled loans, including
approximately $4,500,000 of non-performing loans, which was
completed during the second quarter of 1994.  The net charge-off
figure for 1994 also includes a $500,000 recovery received in
conjunction with a previously discussed insurance settlement.

NON-INTEREST INCOME AND NON-INTEREST EXPENSES

         Total non-interest income of $6,556,000 for 1996 was
$2,065,000 or 46% higher than 1995.  The most significant
component of this increase is represented by service charges on
deposit accounts, which were $1,855,000 or 52.8% higher for 1996
as compared to 1995.  This improvement is attributable to a more
consistent application and collection of certain deposit fee
income for services provided to the existing base of deposit
accounts.  The 52.8% annual growth rate for 1996 is not
indicative of future growth, and future growth, if any, of

<PAGE>


service charge income will more closely coincide with increases
in the number of deposit accounts, increased fees, or new fees
associated with new services.

         Other non-interest income increased $344,000 in 1996 as
compared to 1995.  The largest component of this increase was a
non-recurring recognition of $285,000 which represented damages
awarded to the bank in settlement of a lawsuit it had filed
against an outside service provider for breach of duty.  Non-
interest income for 1996 also included a loss of $45,000 from the
sale of securities available-for-sale, compared to a gain of
$71,000 from the sale of securities available-for-sale in 1995.

         Total non-interest income increased $842,000 or 23.1%
for 1995 as compared to 1994.  The most significant changes were
represented by investment security and loan sale transactions.
During 1995, the Company recorded a gain of $71,000 from the sale
of securities available-for-sale.  This gain represented an
improvement of $240,000 over the loss of $169,000 recorded from
the sale of securities available-for-sale in 1994.  Additionally,
during 1995 the Company recorded gains of $18,000 from the sale
of residential mortgages.  These gains represented an improvement
of $314,000 over the loss of $296,000 realized from the sale of
residential mortgages during 1994.  Increases of $40,000 in ATM
fee income and $36,000 in credit card fees represented the larger
components of the $166,000 increase in other income.  

         Total non-interest expense of $19,849,000 for 1996 was
$313,000 or 1.6% higher than 1995.

         Salaries expense totaled $7,896,000 for 1996, an
increase of $161,000, or 2.1%, compared to 1995.  Merit increases
and increased incentive salary programs were partially offset by
reductions in staff.  Employee benefits expense was $231,000 or
10.2% higher for 1996 as compared to 1995.  Most of this increase
is attributable to higher costs for hospital and medical
insurance and pension plans.

         Furniture and equipment expense of $1,090,000 for 1996
was $123,000 or 10.1% lower than 1995.  This is primarily
attributable to the reduction of equipment rental costs resulting
from the Company's decision to purchase rather than lease its
personal computer equipment.

         Legal fees totaled $858,000 for 1996, an increase of
$311,000, or 56.9%, as compared to 1995.  Most of this increase
is attributable to increased legal expenses associated with the
Bank's efforts to work out its problem loans.

         Professional fees of $1,307,000 for 1996 were $488,000
or 59.6% higher than for 1995.  The largest contributing factor
to this increase were fees of approximately $625,000 paid to an
outside consulting firm which assisted management with a
reengineering project for the Bank.  All identifiable direct
costs associated with this project were expensed in 1996, and
fees paid to this firm for future <PAGE> services are anticipated to be
significantly lower than fees paid in 1996.  However, management
anticipates that the expected savings from lower fees will be
partially offset by higher costs to address ongoing staff
training and bankwide technology improvements identified during
the 1996 reengineering process.

         FDIC and OCC assessments totaled $112,000 for 1996, a
decrease of $455,000, or 80.2%, compared to 1995.  The FDIC
assessment declined from $461,000 in 1995 to the $2,000 minimum
assessment which the Bank was required to pay in 1996 as a well
capitalized institution as defined in the regulatory prompt
corrective action framework for capital adequacy requirements. 
As the result of the Deposit Insurance Act of 1996, the $2,000
annual minimum deposit insurance assessment was repealed, and in
1997 the Bank's insurance assessment will increase to 1.29 cents
per $100 in deposits, which is anticipated to result in an annual
FDIC assessment of approximately $60,000 for 1997, subject to
changes in the Bank's level of deposits.

         Other real estate expense of $202,000 for 1996 was
$103,000 or 104% higher than for 1995.  A significant factor
contributing to this increase was a loss of approximately $95,000
resulting from the sale of an OREO property during 1996.

         Total non-interest expenses of $19,536,000 for 1995
were $537,000 or 2.7% lower than 1994.  Salaries and wages in
1995 were $292,000 or 3.9% higher than those for 1994.  This
increase was attributable in part to an increase of approximately
$112,000 in incentive salary programs as well as payments of
approximately $60,000 to selected employees who qualified for and
elected to participate in an early retirement program.  The
remaining increase was primarily attributable to merit increases. 
Employee benefits expense increased $260,000 or 13% during 1995
as compared to 1994.  The most significant component of this
increase was additional pension expense of $150,000 related to
the early retirement program for selected employees.  Legal fees
in 1995 of $547,000 represented an increase of $411,000 over 1994
legal fees; however, 1994 legal fees were reduced by a one-time
recovery of $875,000 resulting from the settlement of an
insurance claim.  FDIC and OCC assessments were $586,000 lower in
1995 than 1994 as the result of the reduction of the FDIC
assessment during 1995.  The largest component of the decrease in
other expenses was a decline in expenses associated with a data
processing conversion that occurred during 1994.

INCOME TAXES

         The effective tax rates for 1996, 1995 and 1994 were
39.4%, 41.5% and 14.1%, respectively.  The decrease in the
effective tax rate to 39.4% for 1996 was primarily due to the
recognition of tax benefits resulting from the adjustment of the
valuation allowance for deferred tax assets. The decrease in the
effective rate to 14.1% for 1994 was also primarily due to the
recognition of tax benefits resulting from the adjustment of the
valuation allowance for deferred tax assets. 


<PAGE>


         The net change in the total valuation allowance for
1996 was a decrease of $160,000, which was primarily the result
of the reduction of the Bank's state tax loss carryforward during
1996.  The net change in the total valuation allowance for 1994
was a decrease of $1,500,000, which was the result of the
accelerated recognition of temporary differences related to the
sale of non-performing loans in 1994 and improvement in the
Bank's core earnings. 
  
                       FINANCIAL CONDITION

LOANS

         Total loans, net of deferred loan fees, of $287,116,000
at December 31, 1996 increased $19,986,000 or 7.5% from the
December 31, 1995 balance of $267,130,000.  The most significant
growth occurred in the residential mortgage category, which
benefitted from a new fixed rate equity loan program, as well as
an increased emphasis on an adjustable rate one to four family
mortgage program.  Average loans totaled $278,015,000 for 1996,
an increase of $11,920,000 or 4.5% compared to an average of
$266,095,000 for 1995.  For 1996, average loans represented 60.0%
of total interest earning assets, compared to 63.5% of total
interest earning assets for 1995.

         The following table shows the classification of loans
by major category, at December 31, for each of the past five
years.

<TABLE>
                                                          December 31,
                              1996             1995                1994        1993         1992  
                                                      (Dollars in Thousands)
<CAPTION>

<S>                         <C>              <C>                 <C>         <C>           <C>
Real estate loans:
  Construction              $ 5,990           $ 4,097            $ 3,913     $ 5,209       $ 6,602 
  Mortgage
    Residential              69,341            59,390             61,396      64,570        72,014 
    Commercial              126,050           122,347            114,901     108,749       108,548 
Commercial loans             73,171            68,479             76,465      66,612        58,090 
Installment loans            11,791            12,418              9,746       9,178        10,768 
Other loans                   1,021               688              1,001         559           271 
Loans held for sale
 (market value $11,153)           0                 0                  0      11,043             0 
 Total gross loans         $287,364          $267,419           $267,422    $265,920      $256,293 
</TABLE>

         Real estate loans include construction mortgages,
residential mortgages (including home equity loans), and
commercial mortgages.  

         Construction loans are predominately floating rate
loans and the term thereof generally does not exceed one year. 
The majority of the Bank's construction loans consist of loans
secured by single - or multi- family dwellings located in the
Bank's primary market area.

         Residential mortgage loans include mortgages for the
purchase or refinancing of residential properties and are secured
by first liens <PAGE> on those properties.  This category also includes
home equity loans which are secured by either a first or second
lien on real estate.

         Commercial mortgages include mortgages on owner
occupied buildings and investment properties, secured by first
mortgages on these properties.  Amortization is generally based
on terms of 15 years or less, and most loans have interest rate
reset terms of 5 years or less.

         Commercial loans primarily represent loans to
commercial borrowers for working capital and other short-term
needs and term loans for the acquisition of assets.  The terms of
such loans generally range from one to five years.

         Installment loans are granted primarily to individuals
on an installment basis, may be secured by liens on personally
held assets or may be unsecured, and include auto loans, home
improvement loans, student loans, revolving credit plans and
personal loans.

    The following table summarizes the contractual maturities of
certain loan categories at December 31, 1996.

                        Within          1-5        Over 
                       One Year        Years      5 Years             Total
                                     (Dollars in Thousands)

Real estate loans:
  Construction        $ 5,990       $    0       $      0            $  5,990
  Mortgage             29,309       46,894        119,188             195,391
Commercial loans       35,122       27,805         10,244              73,171

     The table below presents the breakdown of loans with fixed
and variable rates at December 31, 1996 for loans with a term of
greater than one year in the following categories:

                             Fixed              Variable  
                         Interest Rates      Interest Rates 
                              (Dollars in Thousands)

Real Estate loans:
  Mortgage               $ 95,546                 $70,536
Commercial loans           18,263                  19,786


          The Company's loan portfolio is varied, with no undue
concentration in any single industry, although most of the loans
in the Company's loan portfolio have been made to borrowers in
New Jersey.  The Company's home equity loan portfolio (which is
included in real estate mortgages in the table above) and a
substantial portion of its commercial loan portfolio have
interest rates that reprice with changes in the prime rate.


<PAGE>



ALLOWANCE FOR POSSIBLE LOAN LOSSES

          The allowance for possible loan losses is maintained at
an amount considered adequate by management and the Board of
Directors to provide for potential credit losses based upon a
periodic evaluation of the risk characteristics of the loan
portfolio.

          Management and the Board of Directors of the Company
review the allowance for possible loan losses on a regular basis. 
Management and the Board evaluate a number of factors in
determining the appropriate level of the allowance for possible
loan losses.  Weakening credits are evaluated individually and
factors such as the creditworthiness of the borrower, the
adequacy of underlying collateral and the probable impact of
business and economic conditions upon the borrower are examined. 
The review process also takes into consideration the possibility
that there may be losses in the loan portfolio which cannot
currently be identified, and the degree of risk inherent in the
composition of the loan portfolio.  The volume of non-performing
and other classified loans and their relationship to the loan
portfolio, as well as historical charge-off experience, are also
examined.

          The following table summarizes the activity in the
allowance for possible loan losses over each of the past five
years.  Also presented are certain key ratios regarding the
allowance.

<TABLE>
                                                            December 31,

                                    1996           1995            1994                1993               1992 

                                                          (Dollars in Thousands)
<CAPTION>
<S>                              <C>             <C>             <C>                 <C>                 <C>
Average loans outstanding 
   during the year               $278,015        $266,095        $262,053            $255,634            $270,994
Total gross loans at 
  period end                     $287,364        $267,419        $267,422            $265,920            $256,293
Allowance, beginning 
  of the year                    $  7,402        $  7,602        $ 11,252            $ 12,659            $ 12,030
Loans charged-off 
  during the year:
    Commercial                        569           1,952           2,184               2,047               1,551
  Mortgage                            520              80           2,809                 379                 136
  Installment                         175              91             148                 157                 584
Total loans charged-off 
  during the year                   1,264           2,123           5,141               2,583               2,271
Recoveries during the year:
  Commercial                          804           1,005             890                 111                 354
  Mortgage                            104             142              10                   0                   2
  Installment                         135              56             141                 165                 109
Total recoveries during 
  the year                          1,043           1,203           1,041                 276                 465
Net loans charged-off 
  during the year                     221             920           4,100               2,307               1,806
Provision charged to 
  operations                        1,350             720             450                 900               2,435
Allowance, end of the year       $  8,531        $  7,402          $7,602             $11,252            $ 12,659
Ratio of net loans 
  charged-off to average
  loans outstanding 
  during the year                   0.08%           0.35%           1.56%               0.90%               0.67%
Allowance for possible 
  loan losses as a
  percentage of total 
  gross loans                       2.97%           2.77%           2.84%               4.23%               4.94%

</TABLE>

 <PAGE>


         The following table reflects the allowance for possible loan losses
by category as of December 31, for each of the past five years:

<TABLE>

                                                                             December 31,
                            1996             1995                     1994                     1993                  1992 
                               Percent          Percent                  Percent                 Percent                Percent
                               of Loans         of Loans                 of Loans                of Loans               of Loans
                                to                to                       to                      to                     to
                      Dollar   Total  Dollar     Total        Dollar     Total      Dollar       Total       Dollar      Total
                      Amount   Loans  Amount     Loans        Amount     Loans      Amount       Loans       Amount      Loans
                                                              (Dollars in Thousands)

<CAPTION>

<S>                  <C>       <C>    <C>        <C>         <C>      <C>            <C>            <C>          <C>        <C>

Real Estate Loans:
  Construction       $   30     2%    $  163        2%       $  163      2%          $ 817             2%        $ 1,538       2%
  Mortgage            1,880    68      1,765       68         1,984     66           3,370            65           2,999      71 
Commercial loans      6,303    26      5,052       26         5,147     29           6,664            25           7,466      23 
Installment loans       171     4        271        4           308      3             401             4             406       4 
Other                   147     *        151        *             0      *               0             4             250       * 
  Total              $8,531   100%    $7,402       100%       $7,602   100%        $11,252           100%        $12,659      100%
*  Less than 1.0%
</TABLE>

          As previously discussed under "PROVISION FOR POSSIBLE
LOAN LOSSES", approximately $2,696,000 of the $5,141,000 of loans
charged off during 1994 resulted from the sale of troubled loans.

          The allowance for possible loan losses includes an
allocation for all loans classified as special mention,
substandard, doubtful or loss (See "Asset Quality" below for
definitions of such classifications).  After allocating the
allowance for classified loans, an allocation is made for all
non-classified loans.  The allocation for non-classified loans is
made by loan category, based upon the historical loss experience
for each loan category as well as perceived risk of loss for each
loan category.  The amount of the allowance applicable to
non-classified loans was $5,819,000 and $3,778,000 at December
31, 1996 and December 31, 1995, respectively.  Since these
factors are subject to change, the allocation of the allowance
for possible loan losses should not be interpreted as an
indication that such amounts or proportions will continue or
indicate future trends.

          The specific amount of the allowance in any particular
category may prove excessive or inadequate and consequently may
be reallocated in the future to reflect current conditions. 
Accordingly, the Company considers the entire reserve to be
available to absorb losses in any category.

ASSET QUALITY

          Various degrees of credit risk are associated with
substantially all investing activities.  Management believes that
the lending function, however, carries the greatest risk of loss.

          The Bank's credit due diligence begins at the time a
borrower and the Bank begin to discuss the origination of a loan. 
Documentation including a borrower's credit history, materials
establishing the value and liquidity of potential collateral, the

<PAGE>



purpose of the loan, the source and timing of the repayment of
the loan and other factors are analyzed before a loan is
submitted for approval.

          The Company attempts to minimize overall credit risk
through loan diversification.  The Company's loan portfolio is
varied, with no undue concentration in any single industry,
although most of the loans in the Company's loan portfolio have
been made to borrowers in New Jersey.

          Individual loan officers are assigned to monitor
non-installment and non-residential mortgage loans and are
responsible for the periodic updating of their reviews of such
loans.  Loan officers are actively encouraged to identify
potential deteriorating loan situations through a self-reporting
system.

          Installment and residential mortgage loans are
primarily monitored through an analysis of their payment status.

          Classified loan reports are prepared and reviewed
regularly by the problem loan committee.  Classified loans are
categorized into one of several categories, depending upon the
condition of the borrower and the strength and amount of
collateral.

          Classifications consist of "special mention loans,"
defined as loans with only modest deficiencies in documentation
and with potentially weakening credit features; "substandard
loans," defined as loans that have a well-defined credit
weakness; "doubtful loans," defined as loans that have a
significantly higher probability of loss than substandard loans;
and "loss" loans which are charged-off when they are deemed
uncollectible.

          Non-performing assets consist of (i) non-performing
loans, which include non-accrual loans and loans past due 90 days
or more as to interest or principal payments but not placed on
non-accrual status; (ii) loans that have been restructured due to
a weakening in the financial position of the borrower
(restructured loans) and (iii) other real estate owned ("OREO"),
net of reserves.


<PAGE>



     The following table reflects the components of
non-performing assets at December 31, for each of the past five
years:

<TABLE>
                                                              December 31,
                               1996              1995            1994                 1993                  1992
                                                           (Dollars in Thousands)
<CAPTION>
<S>                              <C>               <C>            <C>                 <C>
Past due, 90 days or more:
  Mortgage                       $1,068            $1,938         $1,388              $4,535              $5,112 
  Commercial                        247             1,167            714               1,434               1,607 
  Installment                        34                18             23                  53                 163 
Total past due 90 days 
  or more                        $1,349            $3,123         $2,125              $6,022              $6,882 
Non-accrual loans:
  Mortgage                       $2,800            $4,042         $4,357              $9,858              $6,316 
  Commercial                      5,584             3,049          3,222               4,641               6,180 
  Installment                         0                 0              2                   7                  36 
Total non-accrual loans          $8,384            $7,091         $7,581             $14,506             $12,532 
Total non-performing loans       $9,733           $10,214         $9,706             $20,528             $19,414 
Restructured loans 
  (excluding
  amounts classified as
  non-performing loans)           3,934             5,105          5,445               5,721               8,380 
Other real estate owned, net        841               772            400                 461                 402 
Total non-performing 
  assets                       $ 14,508           $16,091        $15,551             $26,710             $28,196 
Non-performing loans as 
  a percent of total
  gross loans                      3.39%             3.82%          3.63%               7.72%               7.57%
Non-performing loans as
  a percent of total assets        1.82%             2.12%          2.26%               4.68%               4.79%
Non-performing assets as a 
  percent of loans and 
  other real estate owned          5.03%             6.00%          5.81%              10.03%              10.98%
Allowance for possible 
  loan losses                  $  8,531           $ 7,402        $ 7,602             $11,252             $12,659 
Allowance for possible 
  loan losses as a percent
  of non-performing loans         87.65%            72.47%         78.32%              54.81%              65.21%

</TABLE>


          It is the Company's general policy to discontinue the
accrual of interest and reverse previously accrued but unpaid
interest as to a particular loan when interest or principal is
more than 90 days past due on such loan or other circumstances
indicate that full collection is questionable, unless the loan is
adequately secured and in the process of collection.  Income on
non-accrual loans is recognized only in the period in which it is
collected.

          In addition to the non-performing and restructured
loans as of December 31, 1996 and 1995, the Company had
classified an additional $3,088,000 and $4,932,000, respectively,
as substandard loans.   A loan loss reserve has been allocated to
such loans in accordance with the Company's policies.

          In the course of resolving non-performing loans, the
Bank may restructure the contractual terms of its loans with its
borrowers.  If, prior to such restructuring, the loan was
classified as non-accrual, it is the Bank's policy to continue to
carry these restructured loans on non-accrual status for a period
of time (typically six months) before management considers their


<PAGE>



return to accrual status.  At December 31, 1996, loans
aggregating $3,934,000 were categorized as restructured.  These
loans are currently performing in accordance with their modified
terms.

          The level of non-performing assets is heavily dependent
upon local economic conditions.  The December 31, 1996 total
non-performing assets of $14,508,000 represents a decrease of
$1,583,000 or 9.8% from December 31, 1995.  There can be no
assurance that the level of the Company's non-performing assets
will not increase in the future.

          In May of 1993, FASB issued Statement of Financial
Accounting Standards No. 114, "Accounting by Creditors for
Impairment of a Loan" and Statement of Financial Accounting
Standards No. 118 "Accounting by Creditors for Impairment of a
Loan-Income Recognition and Disclosure" which apply to financial
statements for fiscal years beginning after December 15,1994. 
These Statements require that impaired loans be measured based on
the present value of expected future cash flows discounted at the
loan's effective interest rate or, as a practical expedient, at
the loan's observable market price or at the fair value of the
collateral if the loan is collateral dependent.  There was no
material impact on the financial position or results of
operations as a result of the Company adopting these statements
during 1995. 

INVESTMENT SECURITIES AND FEDERAL FUNDS SOLD

          The Company invests a portion of its available funds in
short-term and longer-term instruments, including federal funds
sold and investment securities.

          Federal funds sold are used primarily for daily cash
management purposes.  Average federal funds sold of $48,201,000
for 1996 represented 10.4% of total average interest earning
assets, as compared to 9.2% for 1995.

          Investment securities include obligations of the U.S.
Government or its agencies, obligations of states and political
subdivisions, Federal Reserve Bank stock and debt securities. 
The Company's investment securities portfolio is utilized to
collateralize certain of the Bank's lines of credit and public
and fiduciary deposits.  It also provides liquidity through
proceeds from scheduled maturities.  The majority of the
Company's investment securities carry fixed interest rates.

          Effective January 1, 1994, the Company adopted
Statement of Financial Accounting Standards No. 115, "Accounting
for Certain Investments in Debt and Equity Securities" ("SFAS
115").  The financial impact of the adoption was $57,000, net of
tax, which was recorded as an increase to shareholders' equity.


<PAGE>


          SFAS 115 requires companies to divide their securities
holdings among three categories:  held-to-maturity,
available-for-sale, and trading securities.  The accounting
standard provides a different accounting treatment for each
category.

          The Company does not have trading securities, but does
differentiate between held-to-maturity securities and
available-for-sale securities.  Management determines the
appropriate classification of securities at the time of purchase.

          If management has the positive intent and the Company
has the ability at the time of purchase to hold securities until
maturity, they are classified as held-to-maturity securities. 
Such securities are stated at amortized cost, adjusted for
unamortized purchase premiums and discounts.

          Securities in the available-for-sale category are those
for which the Company does not have the positive intent and
ability to hold to maturity.  Available-for-sale securities are
reported at fair value.  Any unrealized appreciation or
depreciation in the available-for-sale securities, net of tax
effects, is reported as a separate component of equity capital. 
At December 31, 1996 and 1995, the Company reported net
unrealized securities gains of $146,000 and $284,000,
respectively, in the Shareholders' Equity section of the
consolidated statement of condition.

          On November 15, 1995, the Financial Accounting
Standards Board (FASB) issued a Special Report, "A Guide to
Implementation of Statement 115 on Accounting for Certain
Investments in Debt and Equity Securities."  The guidance in this
Special Report became effective November 15, 1995.

          Included within the Special Report is guidance that
permitted banking organizations to perform a one-time assessment
to determine the appropriateness of the designations of all
securities currently held.  Any resulting redesignations were to
be made in conjunction with the guidance which allowed banking
organizations to transfer debt securities from the held-to-
maturity portfolio before year-end 1995, without calling into
question their intent to hold other debt securities to maturity.

          In accordance with the guidance contained within the
Special Report, effective December 1, 1995 the Company
transferred securities with a book value of $37,911,000 from
held-to-maturity to available-for-sale.  These securities had a
market value of $38,238,000 which resulted in the Company
recording an unrealized gain on securities available-for-sale,
net of tax, within Shareholders' Equity of $216,000.


<PAGE>


          At December 31, 1996, securities held-to-maturity of
$90,170,000 represented 56.6% of the total investment securities
portfolio, as compared to 51.9% at December 31, 1995.  Securities
available-for-sale of $69,044,000 at December 31, 1996
represented 43.4% of the total investment securities portfolio,
as compared to 48.1% at December 31, 1995.  Total average
investment securities of $137,351,000 for 1996 represented 29.6%
of 1996 total average interest earning assets, up from 27.3% of
total average interest earning assets for 1995.

          The table below presents the amortized cost and total
estimated fair values of securities held-to-maturity as of year
end for each of the past five years:

<TABLE>

                                1996               1995            1994               1993                  1992
                                                                 (Dollars in Thousands)
<CAPTION>
<S>                            <C>                <C>             <C>                 <C>                 <C>
U.S. Treasury                  $     0            $     0         $11,795             $ 8,804             $54,107
U.S. Government Agencies        33,862             11,055           3,080               1,089                 151
Mortgage-backed securities      52,946             46,108          73,204              59,670              44,915
States and political 
  subdivisions                   1,182              1,875           1,336               1,009                 100
Other                            2,180              1,228             374                 376                 381
Amortized cost                 $90,170            $60,266         $89,789             $70,948             $99,654
Estimated fair value           $89,482            $59,948         $84,188             $70,759             $99,817

</TABLE>

          Maturities and weighted average yields of securities
held-to-maturity at December 31, 1996, segregated by contractual
maturity, are illustrated below.  Expected maturities will differ
from contractual maturities because borrowers may have the right
to call or prepay obligations with or without call or prepayment
penalties.

<TABLE>


                                                                  Maturing
                                                     After One         After Five  
                           Within                    But Within        But Within                 After     
                          One Year                   Five Years        Ten Years                Ten Years            Total      
                     Amount     Yield         Amount       Yield  Amount       Yield     Amount       Yield      Amount    Yield
                                                                           (Dollars in Thousands)
<CAPTION>
<S>                   <C>         <C>         <C>          <C>     <C>          <C>       <C>          <C>       <C>        <C>
U.S. Government   
  Agencies            $  --         --%       $10,697      6.73%   $19,165      7.16%     $4,000       7.50%     $33,862    7.07%
Mortgage-backed 
  securities            129       7.27         37,358      5.93     13,035      6.71       2,424       6.75       52,946    6.16 
States and political
subdivisions /1/        --          --          1,182      6.66         --        --          --        --         1,182    6.66
Other                   --          --             --        --         --        --        2,180      6.02        2,180    6.02
Total book value      $  129      7.27%       $49,237      6.12%     $32,200      6.98%    $8,604      6.92%     $90,170    6.50%

(1)  The weighted average yields have been computed based on a tax-equivalent basis, assuming a 34% income
     tax rate.

</TABLE>


     The table below presents the amortized cost and total
estimated fair values of securities available-for-sale at
December 31, 1996, 1995, 1994 and 1993.  There were no such
securities available-for-sale for years prior to 1993:

<PAGE>


                                                  December 31,
                                  1996        1995         1994       1993
                                                   (Dollars in Thousands)

U.S. Treasury                    $12,513    $14,745      $10,932    $14,008
U.S. Government 
  Agencies                         1,000      1,000            0          0 
Mortgage-backed 
  securities                      55,309     39,774       11,297     17,209
Amortized cost                   $68,822    $55,519      $22,229    $31,217
Estimated fair value             $69,044    $55,946      $21,144    $31,303

          Maturities and weighted average yields of securities
available-for-sale at December 31, 1996, segregated by
contractual maturity, are illustrated below.  Expected maturities
will differ from contractual maturities because borrowers may
have the right to call or prepay obligations with or without call
or prepayment penalties.

<TABLE>
                                                               Maturing
                                          After One          After Five  
                      Within             But Within          But Within               After     
                     One Year            Five Years          Ten Years             Ten Years                      Total      
                     Amount    Yield   Amount    Yield    Amount     Yield      Amount      Yield         Amount          Yield
                                                              (Dollars in Thousands)
<CAPTION>
                                                                                            <C>          <C>             <C>
<S>                  <C>       <C>     <C>        <C>      <C>        <C>     <C>
U.S.Treasury         $   --     --%    $12,513    6.15%    $ --       --%     $    --        --%         $12,513          6.15%
U.S. Government 
  Agencies               --     --       1,000    5.76       --        --          --        --            1,000          5.76 
Mortgage-backed
 securities           2,303    5.84     20,082    6.44       --        --      32,924      6.71           55,309          6.52
Total book value     $2,303    5.84%   $33,595    6.31%    $ --        --%    $32,924      6.71%         $68,822          6.44%
</TABLE>

       Realized gains (losses) from the sale of securities
available-for-sale were ($45,000), $71,000 and ($169,000) for
1996, 1995 and 1994, respectively.

DEPOSITS

       The Bank's deposit base is its primary source of funds. 
The Bank offers a broad range of deposit products, including
non-interest bearing demand deposits, NOW accounts, savings
accounts, IMMA's and certificates of deposit.

       The December 31, 1996 total deposit balance of
$485,073,000 represents an increase of $55,932,000 or 12.9% from
the December 31, 1995 balance of $429,681,000.  This growth
occurred in time deposits of $100,000 or more, which time
deposits served primarily as the funding source to support the
growth in the investment and loan portfolios.  This growth in
time deposits originated from new or expanded relationships with
municipal government units within markets served by the bank, and
served as an alternative to other sources of borrowed funds. 
Average time deposits over $100,000 of $52,891,000 for 1996
represented 14.7% of total average interest bearing deposits as
compared to 6.3% in 1995.  This increase in relatively higher
cost deposits was a significant contributor to the overall
increase in the cost of funds for 1996 as compared to 1995.


<PAGE>



       The following table shows a breakdown of the average
balances and average rates paid on the following deposit
categories for each of the past three years:

<TABLE>
                                                          Year Ended December 31,
                                    1996                           1995                               1994
                         Average           Average      Average            Average            Average         Average
                         Balance            Rate        Balance             Rate              Balance           Rate 
                                                   (Dollars in thousands)

<CAPTION>

<S>                      <C>               <C>           <C>                 <C>              <C>              <C>
Demand deposits          $ 97,197              - %       $ 95,264              - %            $ 89,683            - %
Savings and 
  interest bearing 
  demand deposits         222,912            2.20         221,749            2.21              248,752          2.02 
Time deposits             136,968            5.01          98,790            5.07               76,993          3.17    
Total average 
  deposits               $457,077            2.57%       $415,803            2.38%            $415,428          1.79%

</TABLE>

          The following is a breakdown of the maturity of time
certificates of deposit and other time deposits in excess of
$100,000 as of December 31, 1996 and December 31, 1995,
respectively:

                               Dec. 31, 1996     Dec. 31, 1995
                                     (Dollars in Thousands)

Under three months                  $71,160           $12,463
Three to six months                   5,851             4,904
Six to twelve months                  2,993             2,057
Over twelve months                    1,160             1,483
  Total                             $81,164           $20,907

SHORT-TERM BORROWINGS

          Short-term borrowings represent federal funds purchased
and securities sold under agreements to repurchase, which are
used to supplement the Bank's deposit base as a source of
funding.  The majority of these instruments have terms ranging
from one to thirty days. These balances increased $218,000 to
$1,000,000 at December 31, 1996 from $782,000 at December 31,
1995. The average balance of short-term borrowings represented
less than 1% of total average interest bearing liabilities for
both 1996 and 1995.

          Information regarding the levels of short-term
borrowings for each of the past three years is as follows:

                                                    December 31,   
                                            1996        1995       1994
                                                (Dollars in Thousands)
Balance, end of year                      $ 1,000     $  782       $ 177 
Maximum outstanding during
  the year at any month end               $ 1,282    $21,345       $ 177 
Average interest rate, 
  end of year                                4.95%      5.69%       2.95%
Average outstanding 
  during the year                         $ 1,149    $ 2,808       $ 275 
Average interest rate 
  for the year                               4.97%      6.02%       2.18%



<PAGE>


The average amounts outstanding were computed from daily averages
and the average interest rates for the period were computed by
dividing the respective interest expense by the average balance
outstanding.

LIQUIDITY OF THE BANK

          The Bank actively monitors its liquidity position to
ensure that it has sufficient funds to provide for cash outflows
without incurring losses from the premature liquidation of assets
or the unexpected acquisition of costly liabilities.  The Bank's
cash outflows encompass interest paid to depositors and other
creditors, deposit withdrawals, and disbursements to acquire
assets and pay general operating costs.  The Bank obtains cash
from customers in the form of interest and principal payments on
loans, fees paid for services, and from new deposits.  Investment
maturities also provide a source of cash.

          Many different measurements of liquidity are used in
the banking industry.  The ratios of cash and cash equivalents
(including federal funds sold) and short-term securities to total
assets and net loans to total deposits are among some of the more
commonly used indicators.  These measurements are set forth below
as of December 31, 1996 and 1995.

                                           Dec. 31, 1996  Dec. 31, 1995
Cash and cash equivalents
  and securities maturing in
  one year to total assets                        14.9%       22.1%
Net loans to total deposits                       57.4%       60.4%

          To assist in the management of its liquidity, the Bank
had available $23,750,000 in lines of credit with correspondent
banks, which lines were not in use at December 31, 1996.

          Managing the Bank's liquidity position involves a
significant degree of analytical estimation and other objective
factors.  Although customer demand for funds, in the form of
loans or deposit withdrawals, is largely dependent on general
economic factors outside of the Bank's control, management
believes that its present liquidity structure is adequate to meet
such needs.

LIQUIDITY OF BANCORPORATION

          Bancorporation's ability to meet its cash requirements,
including dividend payments, is generally dependent upon the
declaration and payment of dividends by the Bank to
Bancorporation.

          Under Federal law, the approval of the Comptroller of
the Currency is required for the payment of dividends in any
calendar year by Broad National Bank to Broad National
Bancorporation if the total of all dividends declared in any
calendar year exceeds the net income for that year combined with
the retained net income for the preceding two calendar years.  As
of December 31, 1996, retained <PAGE> earnings of the Bank of $6,942,000
are available for payment of dividends to the parent company
without regulatory approval.  

          Additionally, at December 31, 1996, Bancorporation had
available $684,000 of cash  for the purpose of paying future
dividends and operating costs.  However, a change in
circumstances, such as changes in regulatory requirements or in
the Bank's financial condition, could result in Bancorporation
being required by regulatory authorities to utilize its funds to
increase the Bank's capital.  In such event, Bancorporation may
not have sufficient cash for operations or to make dividend
payments and may be required to seek other sources of capital and
liquidity, if available.

INTEREST RATE SENSITIVITY

          Management of interest rate sensitivity involves
matching the maturity and repricing dates of interest-earning
assets with those of interest-bearing liabilities in an effort to
manage the impact of fluctuating net interest rates on net
interest margins.

          The Company's Asset/Liability Committee (the
"Committee") meets at least monthly to establish, communicate,
coordinate and control asset/liability management procedures. 
The purpose of the Committee is to monitor the volume and mix of
the Company's interest sensitive assets and liabilities
consistent with the Company's overall liquidity, capital, growth,
risk and profitability goals.

          Interest rate sensitivity is measured as the difference
between the percentage of assets and liabilities in the Company's
existing portfolio that are subject to repricing within specified
time periods.  These differences, known as interest sensitivity
gaps, are usually calculated cumulatively for blocks of time.

          Companies that are asset-sensitive (a positive gap)
have more assets than liabilities subject to repricing within
specified time periods and these companies are likely to benefit
in periods of rising interest rates, but suffer as rates
decrease.  Companies that are liability-sensitive (a negative
gap) are likely to benefit in periods of declining rates, but
suffer as rates increase.

          At December 31, 1996, there was a cumulative twelve
month liability sensitive gap of .51:1.  In a rising rate
environment, a liability sensitive gap position generally
indicates that increases in the cost of interest bearing
liabilities will outpace increases in income from interest
earning assets.  This risk can be reduced by various strategies,
including the management of liability costs and the investment of
asset maturities and cash flows in such a way as to insulate net
interest income from the effects of changes in interest rates.



<PAGE>



          An interest sensitivity table is not a complete picture
of the possible effect of interest rate changes on net interest
income.  First, changes in the general level of interest rates
will not affect all categories of assets and liabilities equally
or simultaneously.  Second, the table represents a one-day
position: variations occur daily as the Company adjusts its
interest sensitivity throughout the year.  Third, the repricing
distribution of interest sensitive assets may not be indicative
of the liquidity of those assets.  Finally, since this table is
based on contractual maturities, it does not include required
principal payments or estimates of early principal payments on
residential mortgages, installment loans and investment
securities.  These static measurements are best used as early
indicators of potential interest rate exposure.

          These gap positions are also monitored through the use
of simulation modeling techniques which apply alternative
interest rate scenarios to periodic forecasts of future business
activity and estimate the related impact on net interest income. 
The use of simulation modeling assists management in its
continuing efforts to achieve earnings growth in ever-changing
interest rate environments.
     
          The table below indicates as of December 31, 1996 the
time period in which interest-earning assets and interest-bearing
liabilities are scheduled to mature or reprice in accordance with
their contractual terms.

<TABLE>


                                        After             After            After
                                        Three              Six              One
                          Three        Through           Through          Through
                         Months           Six             Twelve           Five              After
                         Or Less        Months            Months          Years            Five Years           Total
                                                          (Dollars in Thousands)
<CAPTION>

<S>                     <C>                <C>           <C>             <C>                 <C>                 <C>
Assets
Investment 
  securities            $ 26,628           $    0         $ 2,473        $ 87,336            $ 42,777            $159,214 
Loans                     83,434            8,512          16,133          71,684             107,601             287,364 
Federal funds sold        57,075                0               0               0                   0              57,075 
Other assets                   0                0               0               0              29,962              29,962 
Total assets            $167,137           $8,512         $18,606        $159,020            $180,340            $533,615 

Liabilities and 
 Shareholders' Equity
NOW and savings 
  accounts              $192,659          $     0         $     0        $      0            $      0            $192,659 
Money market 
  accounts                24,591                0               0               0                   0              24,591 
Time deposits            104,718           35,732          17,848           8,193                 387             166,878 
Short term 
  borrowings               1,000                0               0               0                   0               1,000 
Other liabilities
  and shareholders' 
  equity                       0                0               0               0             148,487             148,487 
Total liabilities
  and shareholders' 
  equity                $322,968          $35,732         $17,848        $  8,193            $148,874            $533,615 
Sensitivity gap        $(155,831)        $(27,220)        $   758        $150,827            $ 31,466            $      0 
Gap as a percentage 
  of assets               -29.20%           -5.10%           0.14%          28.27%               5.90%                  0%
Cumulative 
  sensitivity gap      $(155,831)       $(183,051)      $(182,293)       $(31,466)           $      0            $      0 
Cumulative gap as 
  a percentage
  of assets               -29.20%          -34.30%         -34.16%          -5.90%                  0%                  0%
Cumulative 
 sensitivity ratio         51.75%           48.97%          51.59%          91.82%              100.0%                  0%

</TABLE>

<PAGE>



SHAREHOLDERS' EQUITY

          Shareholders' equity of $38,358,000 at December 31,
1996 was $3,829,000 or 11.1% higher as compared to December 31,
1995.  The ratio of average total equity to average total assets
was 7.20% for 1996 compared to 7.14% for 1995.  Book value per
common share increased to $8.21 at December 31, 1996 from $7.40
at December 31, 1995.

          The redemption of both classes of the Company's
preferred stock was completed during 1996 and 3,947 shares of
both classes of preferred stock were redeemed.  In lieu of
redemption, 575,730 shares or 99.3% of the total outstanding
shares of both classes of preferred stock were converted into
1,176,522 shares of common stock. 

          The Company and its bank subsidiary are subject to
various regulatory capital requirements.  Capital adequacy for
the Company is measured against guidelines established by the
Federal Reserve Board.  The Federal Reserve Board measures
capital adequacy for bank holding companies by using a risk-based
capital framework and by monitoring compliance with minimum
leverage guidelines.  Effective December 31, 1992, bank holding
companies were required to maintain a ratio of at least 8.00%
between capital and risk-weighted assets, of which approximately
one-half (4.00%) must be in Tier 1 capital.  In addition, the
Federal Reserve Board has established minimum leverage ratio
guidelines for bank holding companies.  These guidelines provide
for a minimum leverage ratio (Tier 1 capital to quarterly average
total assets less goodwill) of 3% for bank holding companies that
meet certain criteria, including that they maintain the highest
regulatory rating.  All other bank holding companies are required
to maintain a leverage ratio of 3% plus an additional cushion of
at least 100 to 200 basis points.

          The Bank is subject to generally similar capital
requirements adopted by the OCC.



<PAGE>




          The tables below present in summary form the risk-based
and leverage capital ratios of the Company and the Bank as of
December 31, 1996 and 1995.

<TABLE>
                                            The Company                        The Bank     
                                                    (Dollars in Thousands)
                                    1996                1995           1996            1995
<CAPTION>
<S>                                <C>                 <C>            <C>            <C>
Ratios:
  Tier 1 leverage                   6.92%                7.17%          6.82%          7.00%
  Tier 1 risk-based capital        11.17                10.58          11.00          10.34 
  Total risk-based capital         12.44                11.85          12.26          11.60 
  
Capital:
  Tier 1                        $ 37,512              $33,545        $36,939        $32,779 
  Tier 2                           4,252                4,005          4,252          4,005 
  Total Regulatory              $ 41,764               37,550        $41,191        $36,784 
 
Assets:
  Risk-adjusted assets          $335,854             $316,995       $335,854       $316,995 
  Average assets 
  (leverage capital basis)      $541,903             $468,088       $541,903       $468,088 


</TABLE>


RECENT ACCOUNTING PRONOUNCEMENTS

          In May 1995 the FASB issued SFAS No. 122, "Accounting
for Mortgage Servicing Rights."  The Statement requires
capitalization of the value of rights to service mortgage loans
for others, whether those rights were acquired through purchase
or origination.  SFAS No. 122 also requires that capitalized
mortgage servicing rights be evaluated for impairment based on
their fair value with any adjustments recognized through a
valuation allowance.  The Company did not sell any loans in 1996
and therefore has not been impacted by SFAS No.122.  The Company
does not expect the adoption of SFAS No.122 to have a material
effect on its future financial position or results of operations.

          In October 1995 the FASB issued SFAS No. 123,
"Accounting for Stock-Based Compensation."  This Statement
encourages use of a fair value based method of accounting for
stock-based compensation plans while allowing continued use of
the intrinsic value method of accounting prescribed by Accounting
Principles Board Opinion (APB) No. 25, "Accounting for Stock
Issued to Employees."  Entities electing to continue using the
APB No. 25 method of accounting must make pro forma disclosures
of net income and earnings per shares as if the fair value based
method of accounting, as defined is SFAS No. 123, had been
applied.

          The Company adopted SFAS No. 123 effective January 1,
1996 and will continue accounting for stock-based compensation
under APB No. 25 and include the pro forma disclosures required
by SFAS No. <PAGE> 123 in annual financial statements beginning in the
year ended December 31, 1996.

          In June 1996, the FASB issued SFAS No. 125, "Accounting
for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities."  SFAS No. 125 provides
accounting and reporting standards for transfers and servicing of
financial assets and extinguishments of liabilities.  These
standards are based on consistent application of a financial-
components approach that focuses on control.  Under this
approach, after a transfer of financial assets, an entity
recognizes the financial and servicing assets it controls and the
liabilities it has incurred, derecognizes financial assets when
control has been surrendered, and derecognizes liabilities when
extinguished.  SFAS No. 125 provides consistent standards for
distinguishing transfers of financial assets that are sales from
transfers that are secured borrowings.  SFAS No. 125 is effective
for transfers that occur after December 31, 1996, and will be
applied prospectively.  The Company does not expect the adoption
of SFAS No. 125 to have a material effect on its future financial
position or results of operations.


FACTORS THAT MAY AFFECT FUTURE RESULTS OF OPERATIONS, FINANCIAL
CONDITION OR BUSINESS

          In order to take advantage of the safe harbor
provisions for forward-looking statements contained in Section
27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended, added to those
Acts by the Private Securities Litigation Reform Act of 1995,
Bancorporation is hereby identifying important risks and
uncertainties that could affect Bancorporation's actual results
of operations, financial condition or business and could cause
Bancorporation's actual results of operations, financial
condition or business to differ materially from its historical
results of operations, financial condition or business, or the
results of operations, financial condition or business
contemplated by forward-looking statements made herein or
elsewhere orally or in writing, by, or on behalf of,
Bancorporation.  Factors that could cause or contribute to such
differences include, but are not limited to, those factors
described below.

ECONOMIC CONDITIONS IN BANCORPORATION'S PRIMARY MARKET AREA

          The profitability of Bancorporation is dependant on the
profitability of its subsidiary, Broad National Bank, which is a
national banking association operating out of New Jersey.  The
Bank's financial condition is affected by fluctuations in the
economic conditions prevailing in that portion of New Jersey in
which the Bank's banking operations are located.  Accordingly,
the financial conditions of both the Bank and <PAGE> Bancorporation
would be adversely affected by deterioration in the general
economic and real estate climate in the State of New Jersey.  The
Bank's business is also subject to fluctuations in interest
rates, national and local economic conditions, monetary and
regulatory policies and consumer and institutional confidence in
the Bank.  The fluctuations are neither predictable nor
controllable and may have materially adverse consequences upon
the operations and financial condition of the Bank and
Bancorporation in the future even if other favorable events
occur.

IMPORTANCE OF NET INTEREST INCOME AND SUSCEPTIBILITY TO CHANGES
IN INTEREST RATES

          The primary source of earnings for the Bank and
Bancorporation is net interest income, which is the difference
between interest and fees earned on loans and other interest-
earning assets, and the interest paid on deposits and other
interest-bearing liabilities.  There may be a difference between
the amount of interest-earning assets scheduled to reprice in any
given period and the amount of interest-bearing liabilities
scheduled to reprice over the same time.  Any difference can
create a lag between the time it takes the rate the bank earns
interest to respond to market fluctuations and the time it takes
the rate the bank incurs interest costs to respond to market
fluctuations, and vice-versa.  Because of these "interest
sensitivity gaps," the amount of net interest income may be
affected by fluctuations in the interest rate. 

ASSET QUALITY AND LENDING RISKS

          Success in the banking industry largely depends on the
quality of loans and other assets.  The Bank's loan officers are
actively encouraged to identify deteriorating loans.  Loans are
also monitored and categorized through an analysis of their
payment status.  The Bank's failure to timely and accurately
monitor the quality of its loans and other assets could have a
materially adverse effect on the operations and financial
condition of the Bank and Bancorporation.  There is a degree of
credit risk associated with any lending activity.  Bancorporation
attempts to minimize its credit risk through loan
diversification.  Although Bancorporation's loan portfolio is
varied, with no undue concentration in any one industry,
substantially all of the loans in the portfolio have been made to
borrowers in New Jersey.  Therefore, the loan portfolio is
susceptible to factors affecting the New Jersey area and the
level of non-performing assets is heavily dependant upon local
conditions.  See "Economic Conditions in Bancorporation's Primary
Market Area."  There can be no assurance that the level of
Bancorporation's non-performing assets will not increase above
current levels.  High levels of non-performing assets could have
a materially adverse effect on <PAGE> the operations and financial
condition of the Bank and Bancorporation.

PROVISIONS FOR POSSIBLE LOAN LOSSES

          Bancorporation makes a provision for possible loan
losses based upon management's analysis of potential losses in
the loan portfolio and consideration of prevailing economic
conditions.  Bancorporation may need to increase the provision
for loan losses through additional provisions in the future if
the financial condition of any of its borrowers deteriorates or
if real estate values decline.  See "Asset Quality and Lending
Risks."  Furthermore, various regulatory agencies, as an integral
part of their examination process, periodically review
Bancorporation's loan portfolio, provision for loan losses, in-
substance foreclosed loans, and real estate acquired by
foreclosure.  Such agencies may require, and in the past have
required, Bancorporation to recognize additions to the provision
for loan losses based on their judgments of information available
to them at the time of the examination.  Any additional
provisions for possible loan losses, whether required as a result
of regulatory review or initiated by Bancorporation itself, may
materially alter the financial outlook of the Bank and
Bancorporation.  

COMPETITION IN BANCORPORATION'S MARKET AREA

          Vigorous competition exists in all major areas where
Bancorporation and the Bank presently engage in business.  The
Bank faces intense competition in local and national markets from
other major banking institutions.  The Bank is in direct
competition with some larger institutions that have substantially
greater resources, better name recognition, stronger market
presence, and the ability to offer a wider range of services. 
Competition from larger institutions is especially prevalent due
to the accelerated pace of bank mergers in the New Jersey area. 
The long-term impact of such mergers and consolidations on the
New Jersey market area is uncertain.  The Bank may face even more
intense competition because of the proliferation of bank mergers. 
An increase in the intensity of competition from other banks in
the New Jersey market could have a materially adverse impact on
the operations and financial condition of the Bank and
Bancorporation.

          In addition to the competition from rival banking
companies, the Bank faces competition from non-bank institutions
including: finance companies; mortgage lenders; small loan
companies; credit unions; insurance companies; and a variety of
other financial service and advisory companies.  The stock
market, mutual funds, and other non-federally insured investments
also compete with the Bank for customer deposits.  The Bank may
face more intense competition from these and other <PAGE> non-banking
industries and investments in the future.  A failure of the Bank
to be competitive could have a materially adverse effect on the
Bank and Bancorporation.

REGULATION

     Banks and bank holding companies such as Bancorporation are
subject to regulation by both federal and state bank regulatory
agencies.  The regulations, which are designed to protect
borrowers and promote certain social policies, include
limitations on the operations of banks and bank holding
companies, such as minimum capital requirements and restrictions
on dividend payments.  These regulations are not necessarily
designed to maximize the profitability of banking institutions. 
Future changes in the banking laws and regulations could have a
materially adverse effect on the operations and financial
condition of the Bank and Bancorporation.

IMPORTANCE OF EXECUTIVE OFFICERS

          The success of the Bank and Bancorporation has been
largely dependant on the efforts of Donald Karp, John Dorman and
the other executive officers.  These individuals are expected to
continue to perform their services.  However, the loss of the
services of Donald Karp, John Dorman, or any of the other key
executive officers could have a materially adverse effect on the
Bank and Bancorporation.  

ADDITIONAL FACTORS

          Additional risks and uncertainties that may affect the
future results of operations, financial condition or business of
the Bank and Bancorporation include, but are not limited to: (i)
the ability to keep pace with technological change including
developing and implementing technological advances timely and
cost-effectively in order to provide better service and remain
competitive; (ii) adverse publicity, news coverage by the media,
or negative reports by brokerage firms, industry and financial
analysts regarding the Bank or Bancorporation; and (iii) changes
in accounting policies and practices.



<PAGE>


ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

          BROAD NATIONAL BANCORPORATION AND SUBSIDIARIES
            INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

                                                             Page

Independent Auditors' Report as of December 31, 1996
     and 1995 and for the years ended December 31, 1996,
     1995 and 1994                                             53

Consolidated Statements of Condition as of December 31,
     1996 and 1995                                             54

Consolidated Statements of Income for each of the years
     ended December 31, 1996, 1995 and 1994                    55

Consolidated Statements of Changes in Shareholders' Equity
     for the years ended December 31, 1996, 1995 and 1994      57

Consolidated Statements of Cash Flows for each of the 
     years ended December 31, 1996, 1995 and 1994              58

Notes to Consolidated Financial Statements                     59


All schedules are omitted because they are not applicable, or not
required, or because the required information is included in the
financial statements or the notes thereto.



<PAGE>



INDEPENDENT AUDITOR'S REPORT

To the Shareholders and Board of Directors of 
Broad National Bancorporation:

          We have audited the accompanying consolidated
statements of condition of Broad National Bancorporation and
subsidiaries as of December 31, 1996 and 1995 and the related
consolidated statements of income, changes in shareholders'
equity, and cash flows for each of the years in the three-year
period ended December 31, 1996.  These consolidated financial
statements are the responsibility of the Company's management. 
Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

          We conducted our audits in accordance with generally
accepted auditing standards.  Those standards require that we
plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting
principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. 
We believe that our audits provide a reasonable basis for our
opinion.

          In our opinion, the consolidated financial statements
referred to above present fairly, in all material respects, the
financial position of Broad National Bancorporation and
subsidiaries as of December 31, 1996 and 1995, and the results of
their operations and their cash flows for each of the years in
the three-year period ended December 31, 1996 in conformity with
generally accepted accounting principles.

          As discussed in note 1 to the consolidated financial
statements, Broad National Bancorporation and subsidiaries
adopted the provisions of the Financial Accounting Standards
Board's Statement of Financial Accounting Standards No. 115,
"Accounting for Certain Investments in Debt and Equity
Securities" in 1994.


                                        /s/ KPMG Peat Marwick LLP

                                            KPMG Peat Marwick LLP




Short Hills, New Jersey
January 15, 1997


<PAGE>



Broad National Bancorporation and Subsidiaries
CONSOLIDATED STATEMENTS OF CONDITION
December 31, 1996 and 1995
(Dollars in thousands, except share amounts)
                                                      1996          1995 
ASSETS
CASH AND DUE FROM BANKS (Note 10)                   $ 19,782       $25,810
FEDERAL FUNDS SOLD                                    57,075        61,300
CASH AND CASH EQUIVALENTS                             76,857        87,110
SECURITIES HELD-TO-MATURITY
 (aggregate market value $89,482                            
  and $59,948, respectively) (Note 2)                 90,170        60,266
SECURITIES AVAILABLE-FOR-SALE (Note 2)                69,044        55,946
LOANS, net of deferred loan fees (Note 3)            287,116       267,130
LESS - Allowance for possible loan 
  losses (Note 4)                                      8,531         7,402
        NET LOANS                                    278,585       259,728
PREMISES AND EQUIPMENT, net (Note 5)                   8,888         9,418
ACCRUED INTEREST RECEIVABLE                            3,351         2,819
OTHER ASSETS (Note 6)                                  6,720         5,898
TOTAL ASSETS                                        $533,615      $481,185

LIABILITIES AND SHAREHOLDERS' EQUITY
DEPOSITS
  Non-interest bearing demand                       $100,945      $102,207
  Savings and interest bearing demand                217,250       220,058
  Time deposits less than $100,000                    85,714        86,509
  Time deposits of $100,000 or more                   81,164        20,907
        Total deposits                               485,073       429,681
SHORT-TERM BORROWINGS (Note 9)                         1,000           782
ACCRUED TAXES, INTEREST AND OTHER 
  LIABILITIES (Notes 6 and 7)                          9,184        16,193
        TOTAL LIABILITIES                            495,257       446,656
COMMITMENTS AND CONTINGENCIES (Note 10)
SHAREHOLDERS' EQUITY (Note 11)
Preferred stock-1985 class, $10 par 
 value, authorized 17,124 shares, 
 outstanding 0 shares in 1996 and 17,124 
 shares in 1995                                            0           171
8 1/2% Cumulative Convertible Preferred 
 Stock-1992 class, $1 par value, 
 authorized 690,000 shares, outstanding 
 0 shares in 1996 and 562,553 shares in 1995               0           563
Common stock, $1 par value, authorized                 
 5,500,000 shares; issued: 1996, 
 4,677,188 shares; 1995, 3,059,203 shares              4,677         3,059
Capital surplus                                       26,589        23,145
Retained earnings                                      7,004         7,307
Common stock in treasury, at cost: 
 5,000 shares in 1996 and 0 shares in 1995              (58)             0
Unrealized gain on securities 
  available-for-sale, net                                146           284
         TOTAL SHAREHOLDERS' EQUITY                   38,358        34,529
TOTAL LIABILITIES AND SHAREHOLDERS' 
  EQUITY                                            $533,615      $481,185

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

<PAGE>


Broad National Bancorporation and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME
For the years ended December 31, 1996, 1995 and 1994
(In thousands, except per share amounts)

                                                  1996      1995      1994 

INTEREST INCOME
  Interest and fees on loans (Note 3)          $24,190    $24,337    $22,130 
  Interest on securities held-to-maturity
   Taxable                                       4,667      5,071      4,544 
   Tax exempt                                       49         55         28 
  Interest on securities available-for-sale      3,689      1,682      1,257 
  Interest on federal funds sold                 2,567      2,253      1,836 
   TOTAL INTEREST INCOME                        35,162     33,398     29,795 
INTEREST EXPENSE
   Interest on savings and interest bearing
       demand deposits                           4,899     4,900      5,018 
   Interest on time certificates of 
       deposit of $100,000 or more               2,639     1,040        491 
   Interest on other time deposits               4,222     3,973      1,949 
   Interest on short-term borrowings                58       169          6 
TOTAL INTEREST EXPENSE                          11,818    10,082      7,464 
NET INTEREST INCOME                             23,344    23,316     22,331 
PROVISION FOR POSSIBLE LOAN LOSSES (Note 4)      1,350       720        450 
NET INTEREST INCOME AFTER PROVISION FOR  
 POSSIBLE LOAN LOSSES                           21,994     22,596     21,881 
NON-INTEREST INCOME
 Service charges on deposit accounts             5,370      3,515      3,393 
 Other income                                    1,231        887        721 
 Gain (loss) on sale of securities available-
       for-sale (Note 2)                           (45)        71       (169)
 Gain (loss) on sale of loans                        0         18       (296)
 TOTAL NON-INTEREST INCOME                       6,556      4,491      3,649 
NON-INTEREST EXPENSES
 Salaries and wages                              7,896      7,735      7,443 
 Employee benefits (Note 7)                      2,486      2,255      1,995 
 Occupancy expense (Note 10)                     1,923      1,975      1,927 
 Furniture and equipment expense                 1,090      1,213      1,361 
 Advertising                                       406        425        360 
 Data processing fees                            1,070      1,086      1,256 
 Legal fees                                        858        547        136 
 Professional fees                               1,307        819        806 
 Insurance                                         413        415        374 
 Postage, delivery and communication               675        624        589 
 FDIC and OCC assessments                          112        567      1,153 
 Other real estate expense                         202         99        169 
 Other expenses                                  1,411      1,776      2,504 
    TOTAL NON-INTEREST EXPENSES                 19,849     19,536     20,073 

INCOME BEFORE INCOME TAXES                       8,701      7,551      5,457 
PROVISION FOR INCOME TAXES (Note 6)              3,428      3,131        768 
NET INCOME                                     $ 5,273    $ 4,420     $4,689 



<PAGE>



NET INCOME APPLICABLE TO COMMON
  STOCK (NOTE 11)                              $ 5,273     $ 3,840     $4,075 
AVERAGE NUMBER OF COMMON SHARES 
  OUTSTANDING (Note 11)            
     PRIMARY                                     4,650       3,302      3,168 
     ASSUMING FULL DILUTION                      4,791       4,735      4,676 
NET INCOME PER COMMON SHARE (Note 11) 
PRIMARY EARNINGS PER COMMON SHARE                $1.13       $1.16      $1.29 
FULLY DILUTED EARNINGS PER COMMON SHARE          $1.10       $0.93      $1.00 


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



<PAGE>



Broad National Bancorporation and Subsidiaries
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
For the years ended December 31, 1996, 1995, and 1994
(In thousands, except per share amounts)

<TABLE>
                                                                                          Unrealized
                                                                                             Gain
                       Number                                                             (Loss) On
                        Of       Pre-     Pre-                                            Securities
                      Common    ferred  ferred    Common  Capital     Retained  Treasury  Available
                      Shares    Stock-  Stock-    Stock   Surplus     Earnings    Stock   for-Sale,   
                                 1985    1992                                               Net      Total

<CAPTION>

<S>                    <C>      <C>     <C>        <C>     <C>        <C>       <C>      <C>         <C>
BALANCE, 
DECEMBER 31, 
1993                   2,738      $172    $657     $2,738  $22,273    $1,581        --       --      $27,421

NET INCOME - 
  1994                   --         --      --         --              4,689        --       --        4,689
UNREALIZED GAIN 
 ON SECURITIES
 AVAILABLE-FOR-
 SALE                    --         --      --         --      --        --         --       57           57
CONVERSION OF 
 1992 PREFERRED 
 STOCK                    7         --       (4)         7    (3)        --         --       --           --
CONVERSION OF 
  1985 PREFERRED 
  STOCK                   1        (1)       --          1     --        --         --       --           --
EFFECT OF 5% 
 STOCK DIVIDEND         137         --       --        137    943     (1,080)       --       --           --
CASH DIVIDENDS 
  DECLARED COMMON 
  STOCK - $0.16 
  PER SHARE              --         --        --         --    --       (511)       --        --        (511)
   PREFERRED STOCK 
    - 1992 - 
    $0.85 PER 
    SHARE                --         --         --         --    --      (558)       --        --        (558)
   PREFERRED STOCK 
    - 1985 - 
    $3.42 PER 
    SHARE                --         --         --         --    --        (59)      --        --         (59)
NET CHANGE IN 
 UNREALIZED GAIN 
 (LOSS) ON 
 SECURITIES 
 AVAILABLE-FOR-
 SALE, NET               --         --         --         --     --        --       --      (773)       (773)
BALANCE, 
 DECEMBER 31, 
 1994                 2,883       $171        $653     $2,883  $23,213  $4,062      --     $(716)     $30,266
NET INCOME 
 - 1995                 --          --          --         --      --    4,420      --        --        4,420
CONVERSION OF 
 1992 PREFERRED 
 STOCK                 173          --         (90)        173     (83)     --      --        --           --
EXERCISE OF 
 STOCK OPTIONS           3          --          --           3      15      --      --        --           18
CASH DIVIDENDS 
 DECLARED COMMON 
 STOCK-$0.17 
 per share              --          --          --         --       --    (595)     --        --          (595)
 PREFERRED STOCK 
  - 1992 - $0.85 
  PER SHARE             --          --          --         --        --   (521)     --        --          (521)
 PREFERRED STOCK 
  - 1985 - $3.42 
  PER SHARE             --          --          --         --        --    (59)     --        --           (59)
NET CHANGE IN 
 UNREALIZED GAIN 
 (LOSS) ON 
 SECURITIES 
 AVAILABLE-FOR-
 SALE, NET              --          --           --        --         --    --      --      1,000        1,000
Balance, 
December 31, 
1995                 3,059        $171         $563     $3,059    $23,145  $7,307   --      $ 284      $34,529
NET INCOME 
 - 1996                 --         --            --         --         --   5,273   --         --        5,273
REDEMPTION OF 
 1985 PREFERRED 
 STOCK                  --         (2)           --         --         (6)     --    --        --           (8)
CONVERSION OF 
 1985 PREFERRED 
 STOCK                 110        (169)           --        110        59      --    --        --           --
REDEMPTION OF 
 1992 PREFERRED 
 STOCK                  --          --            (4)         --       (35)    (5)   --        --           (44)
CONVERSION OF 
 1992 PREFERRED 
 STOCK               1,067          --           (559)      1,067      (508)   --    --        --            --
EXERCISE OF 
 STOCK OPTIONS          16          --             --         16         82    --    --        --            98
EFFECT OF 10% 
 STOCK DIVIDEND        425          --             --        425      3,852  4,277)  --        --            --
CASH DIVIDENDS 
 DECLARED 
 COMMON STOCK - 
 $0.27 PER SHARE        --          --             --         --         --  (1,294)  --       --        (1,294)
PURCHASE OF
 TREASURY STOCK         --          --             --         --         --      --   (58)     --           (58)
NET CHANGE IN 
 UNREALIZED GAIN 
 (LOSS) ON 
 SECURITIES 
 AVAILABLE-FOR-
 SALE, NET              --          --             --         --         --      --    --    (138)         (138)
BALANCE, 
 DECEMBER 31, 
 1996                4,677        $   0          $   0     $4,677    $26,589  $7,004 $(58)   $146        $38,358

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

</TABLE>


<PAGE>

Broad National Bancorporation and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31, 1996, 1995 and 1994
(In thousands)

<TABLE>

                                            1996            1995        1994
<CAPTION>
<S>                                      <C>               <C>         <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income                               $ 5,273           $4,420      $4,689 
Adjustments to reconcile net income to
net cash provided by (used in) operating
 activities:
Depreciation and amortization               1,229            1,185      1,255 
Amortization of securities premium, net       709              440        749 
Amortization of deferred points and fees
  and deferral of loan origination costs     (297)            (571)      (229)
Provision for possible loan losses          1,350              720        450 
Deferred tax (benefit) provision             (392)             899       (830)
(Decrease)increase in accrued taxes,
  interest, and other liabilities          (7,009)           9,472      2,018 
(Gain) loss on sale of securities
   available-for-sale                           45             (71)       169 
(Gain) loss on sale of loans                    0              (18)       296 
Write down of other real estate owned           0                0        151 
Loss on the sale of other real estate owned    96               23         18 
(Increase) decrease in accrued interest 
  receivable                                 (532)              41       (456)
Other assets, net                            (747)          (3,040)       261 
Net cash provided by (used in) operating
 activities                                ($ 275)         $13,500     $8,541 
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale of other real estate
 owned                                    $    292          $   308    $  737 
Net (increase) decrease in loan
  balances                                 (19,909)           1,144   (20,079)
Proceeds from the sale of loans                 0             1,432    14,499 
Proceeds from the maturities of 
  securities held-to-maturity              14,745             8,936    20,386 
Purchase of securities held-to-maturity   (44,986)          (17,722)  (39,854)
Proceeds from the maturities of 
  securities available-for-sale            15,795            1,846      6,137 
Proceeds from the sale of securities 
  available-for-sale                       17,103           18,896     11,670 
Purchase of securities available-
  for-sale                                (46,623)         (16,093)   ( 8,941)
Capital expenditures                         (699)         ( 1,077)   ( 1,307)
Net cash used in investing activities   $ (64,282)         $(2,330)  $(16,752)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase (decrease) in time
  deposits                                $59,462          $32,028    $(4,913)
Net increase (decrease) in demand deposit,
savings and interest bearing demand 
  deposits                                (4,070)            6,187     (9,687)
Net increase (decrease) in short term
  borrowings                                 218               605       (165)
Dividends paid                            (1,294)           (1,175)    (1,071)
Issuance of Common Stock                       98                0          0 
Redemption of Preferred Stock                 (52)               0          0 
Purchase of Treasury Stock                    (58)               0          0 
Net cash provided by (used in) financing
  activities                              $54,304          $37,645    $(15,836)
NET INCREASE (DECREASE) IN CASH AND CASH
  EQUIVALENTS                            (10,253)           48,815     (24,047)
CASH AND CASH EQUIVALENTS, beginning of
  year                                    87,110            38,295      62,342
CASH AND CASH EQUIVALENTS, end of year   $76,857          $ 87,110    $ 38,295 
SUPPLEMENTAL DISCLOSURES OF CASH FLOW 
INFORMATION:
Cash paid during the year for
  Interest                               $11,939          $  8,823      $7,430 
  Income taxes                             2,847             3,031       1,002 
NONCASH OPERATING ACTIVITIES:
Transfer of loans to other real
   estate owned                          $   458          $    702       $ 390
Transfer of securities
  held-to-maturity
  to securities available-for-sale       $     0          $ 37,911       $   0 

</TABLE>

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


<PAGE>




Broad National Bancorporation and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1996

NOTE 1:  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

          The more significant accounting policies not described
elsewhere in these notes are as follows:

PRINCIPLES OF CONSOLIDATION 

          The consolidated financial statements include the
accounts of Broad National Bancorporation (the Company), its
wholly owned subsidiary Broad National Bank (the Bank) and the
Bank's wholly owned subsidiaries, BNB Investment Corporation,
Broad National Realty Corporation and Bronatoreo.  All
intercompany accounts and transactions have been eliminated.

BASIS OF FINANCIAL STATEMENT PRESENTATION 

          In preparing the consolidated financial statements,
management is required to make estimates and assumptions that
affect the reported amounts of assets and liabilities as of the
date of the statements of condition and results of operations for
the periods indicated.  Actual results could differ significantly
from those estimates.

          Material estimates that are particularly susceptible to
significant change in the near-term relate to the determination
of the allowance for possible loan losses and the valuation of
other real estate owned.  In connection with the determination of
these allowances, management generally obtains independent
appraisals.

          While management uses available information to
recognize losses on loans and other real estate owned, future
additions may be necessary based on changes in economic
conditions.  In addition, various regulatory agencies, as an
integral part of their examination process, periodically review
the Company's allowance for losses on loans, and valuation of
other real estate owned.  Such agencies may require the Company
to recognize additions to the allowance or changes in valuation
based on their judgments of information available to them at the
time of their examination.

          A substantial portion of the Company's loans are
secured by real estate in New Jersey.  Accordingly, as with most
financial institutions in this market area, the ultimate
collectibility of a substantial portion of the Company's loan
portfolio is susceptible to changes in New Jersey's market
conditions.

FEDERAL HOME LOAN BANK OF NEW YORK (FHLBNY) STOCK

          The Bank, as a member of the FHLBNY, is required to
hold shares of capital stock of FHLBNY, which are carried at
cost, based upon a specified formula.

INVESTMENT SECURITIES

          Effective January 1, 1994, the Company adopted
Statement of Financial Accounting Standards No. 115, "Accounting
for Certain Investments in Debt and Equity Securities" ("SFAS
115").  The financial impact of the adoption was $57,000, net of
tax, which was recorded as an increase to shareholders' equity. 
SFAS 115 requires companies to divide their securities holdings
among three categories:  held-to-maturity, available-for-sale,
and trading securities.  The accounting standard provides a
different accounting treatment for each category.

          The Company does not have trading securities, but does
differentiate between  held-to-maturity securities and
available-for-sale securities.  Management determines the
appropriate classification of securities at the time of purchase.

          If management has the positive intent and the Company
has the ability at the time of purchase to hold securities until
maturity, they are classified as held-to-maturity securities. 
Such securities are stated at amortized cost, adjusted for
unamortized purchase premiums and discounts.

           Securities in the available-for-sale category are
those for which the Company does not have the positive intent and
ability to hold to maturity.   Available-for-sale securities are
reported at fair value.  Any unrealized appreciation or
depreciation in the available-for-sale securities, net of tax
effects, is reported as a separate component of shareholders'
equity.  Realized gains or losses on the sale of securities
available-for-sale are recognized on the specific identification
method.

LOANS AND LOAN FEES

          Loans are stated at their principal amount outstanding,
net of deferred loan fees and costs.

          Non-refundable fees and costs associated with
originating or acquiring loans are deferred and amortized over
the expected remaining life of the related loans by use of a
method which approximates the level yield method.

          It is the policy of the Bank to discontinue the accrual
of interest and reverse previously accrued but unpaid interest
where interest or principal is more than 90 days past due or when
other circumstances indicate that collection is questionable,
unless the loans are adequately secured and in the process of
collection.  Income on these loans is recognized only in the
period in which it is collected.

ALLOWANCE FOR POSSIBLE LOAN LOSSES 

          The allowance for possible loan losses is maintained at
a level considered adequate to provide for potential loan losses. 
The allowance is increased by provisions charged to expense and
reduced by net charge-offs.  The level of the allowance is based
upon management's evaluation of potential losses in the loan
portfolio, after consideration of prevailing economic conditions.

          Effective January 1, 1995, the Company adopted
Statement of Financial Accounting Standards No. 114, "Accounting
by Creditors for Impairment of a Loan" ("SFAS 114").  SFAS 114
requires that the value of an impaired loan be measured based
upon the present value of expected future cash flows discounted
at the loan's effective interest rate, or the fair value of the
collateral if the loan is collateral dependent.  Smaller balance
homogeneous loans that are collectively evaluated for impairment,
such as residential mortgage loans and installment loans, are
specifically excluded from impaired loans.  The impaired loan
portfolio is primarily collateral dependent, as defined by SFAS
114.  <PAGE> Impaired loans are assessed to determine that each loan's
carrying value is not in excess of the fair value of the related
collateral or the present value of expected future cash flows. 
The Bank has identified the population of loans to be evaluated
for impairment to be non-accrual loans and loans internally
classified as substandard or below and in each instance above an
established dollar threshold.  All loans below the established
dollar threshold are considered in the Bank's normal credit
evaluation process.
  
          Effective January 1, 1995, the Bank adopted Statement
of Financial Accounting Standards No. 118, "Accounting by
Creditors for Impairment of a Loan - Income Recognition and
Disclosures" ("SFAS 118").  The Bank has chosen to maintain
existing income recognition policies with respect to non-accrual
loans.

OTHER REAL ESTATE OWNED 

          Other real estate owned is composed of foreclosed
properties where the Bank has actually received title.  Such
properties are carried at the lower of cost or fair value less
estimated cost to sell.  The fair value of such assets is
determined based upon independent appraisals and other relevant
factors.  Operating expenses, and gains or losses from the sale
of other real estate owned are charged or credited to other real
estate expense.

          Other real estate owned is included in "Other Assets"
in the Consolidated Statements of Condition.

PREMISES AND EQUIPMENT 

          These assets are stated at cost less accumulated
depreciation and amortization, which are computed primarily using
the straight-line method over the estimated useful lives of the
assets.  Gains or losses on dispositions are reflected in current
operations.  Maintenance and repairs are charged to expense as
incurred.

INCOME TAXES 

          Bancorporation and the Bank file a consolidated federal
income tax return.  State income tax returns are filed on a
separate basis.

          The Company accounts for income taxes using the asset
and liability method. Temporary differences between the basis of
assets and liabilities for financial reporting and tax purposes
are measured as of the balance sheet date.  Deferred tax
liabilities or recognizable deferred tax assets are calculated on
such differences, using current statutory rates which result in
future taxable or deductible amounts.  The effect on deferred
taxes of a change in tax rates is recognized in income in the
period that includes the enactment date.

NET INCOME PER SHARE 

          Primary net income per share is computed by dividing
net income, less dividends on preferred stock, by the weighted
average number of common shares outstanding during each year
adjusted for dilutive stock options.  Fully diluted per share
amounts are computed by dividing net income by the weighted
average number of common shares outstanding adjusted for shares
issuable upon conversion of preferred stock and dilutive stock
options.  


<PAGE>



         All share and per share amounts have been restated to
reflect the 5% stock dividend distributed in December 1994, and
the 10% stock dividend distributed in October 1996.

STOCK COMPENSATION PLANS

          Prior to January 1, 1996, the Bank accounted for its
stock option plans in accordance with the provisions of
Accounting Principles Board (APB) Opinion No. 25, "Accounting for
Stock Issued to Employees," and related interpretations.  As
such, compensation expense would be recorded on the date of grant
only if the current market price of the underlying stock exceeded
the exercise price.  On January 1, 1996, the Bank adopted
Statement of Financial Accounting Standards No. 123, "Accounting
for Stock-Based Compensation" ("SFAS 123"), which permits
entities to recognize as expense over the vesting period the fair
value of all stock-based awards on the date of grant. 
Alternatively, SFAS 123 also allows entities to continue to apply
the provisions of APB Opinion No. 25 and provide pro forma net
income and pro forma earnings per share disclosures for employee
stock option grants made in 1995 and future years as if the fair-
value-based method defined in SFAS 123 had been applied.  The
Bank has elected to continue to apply the provisions of APB
Opinion No. 25 and provide the pro forma disclosure provisions of
SFAS 123.  

STATEMENT OF CASH FLOWS 

          For purposes of reporting cash flows, cash and cash
equivalents include cash on hand, noninterest bearing amounts due
from banks, and federal funds sold.

RECLASSIFICATIONS 

          Certain amounts in the consolidated financial
statements presented for prior periods have been reclassified to
conform with the 1996 presentation.

NOTE 2:  INVESTMENT SECURITIES

<TABLE>


          The amortized costs, gross unrealized gains and losses and estimated fair values
of securities held-to-maturity are as follows (in thousands): 

                                                  December 31                                   
                                        1996                                1995
                                       Gross          Gross    Estimated                  Gross        Gross        Estimated
                           Amortized   Unrealized   Unrealized    Fair    Amortized    Unrealized    Unrealized        Fair
                              Cost        Gains        Losses     Value      Cost         Gains         Losses         Value

<CAPTION>
<S>                        <C>         <C>          <C>         <C>       <C>          <C>
U.S. Government
  Agencies                   $33,862    $  42        $(177)     $ 33,727    $11,055      $ 35         $  (39)         $11,051
Mortgage-Backed 
  Securities                  52,946       30         (591)       52,385     46,108        50           (376)          45,782
States and Political
  Subdivisions                 1,182        8            0         1,190      1,875        12              0           1,887
Other Bonds                       32        0            0            32         32         0              0              32
Total Debt 
  Securities                 $88,022     $  80       $(768)      $87,334    $59,070       $97         $ (415)        $58,752
FRB and FHLB Stock             2,148         0           0         2,148      1,196         0              0           1,196
Total Securities             
  Held-to-Maturity           $90,170       $80       $(768)      $89,482    $60,266       $97         $ (415)        $59,948


</TABLE>

          The amortized cost and estimated fair value of
securities held-to-maturity at December 31, 1996, by contractual
maturity, are shown below.  Expected maturities will differ from
contractual maturities because borrowers may have the right to
call or prepay obligations with or without call or prepayment
penalties.


<PAGE>



                                                           Estimated
                                            Amortized         Fair
        Cost                                    Value
   (in Thousands)
Due in one year or less                        $   129          $129
Due in one year through five years              49,237        48,736
Due after five years through ten years          32,200        32,100
Due after ten years                              6,456         6,369
Total Debt Securities                          $88,022        87,334
FRB and FHLB Stock                               2,148         2,148
Total Securities held-to-maturity              $90,170       $89,482

          On November 15, 1995, the Financial Accounting
Standards Board (FASB) issued a Special Report, "A Guide to
Implementation of Statement 115 on Accounting for Certain
Investments in Debt and Equity Securities."  The guidance in this
Special Report became effective November 15, 1995.  In accordance
with the guidance contained within the Special Report, effective
December 1, 1995 the Company transferred securities with a book
value of $37,911,000 from held-to-maturity to available-for-sale. 
These securities had a market value of $38,238,000 which resulted
in the Company recording an unrealized gain on securities
available-for-sale, net of tax, within shareholders' equity of
$216,000.

          The amortized costs, gross unrealized gains and losses
and estimated fair values of securities available-for-sale are as
follows (in thousands):

<TABLE>

                                                  December 31                                   
                                   1996                                1995
                                      Gross           Gross       Estimated                 Gross         Gross        Estimated
                        Amortized   Unrealized      Unrealized       Fair    Amortized    Unrealized     Unrealized       Fair
                          Cost        Gains           Losses       Value       Cost         Gains         Losses         Value
<CAPTION>

<S>                      <C>        <C>            <C>            <C>        <C>          <C>           <C>            <C>
U.S. Treasury Notes      $12,513       $ 83           $ (1)       $12,595    $14,745      $200          $  (8)         $14,937
U.S. Government 
 Agencies                  1,000          0             (4)           996      1,000         1              0            1,001
Mortgage Backed 
 Securities               55,309        280           (136)        55,453     39,774       310            (76)          40,008
                         $68,822       $363          $(141)       $69,044    $55,519      $511          $ (84)         $55,946

</TABLE>


          The amortized cost and estimated fair value of
securities available-for-sale at December 31, 1996, by
contractual maturity, are shown below.  Expected maturities will
differ from contractual maturities because borrowers may have the
right to call or prepay obligations with or without call or
prepayment penalties.

                                                                Estimated
                                                   Amortized       Fair
                                                     Cost         Value
   (in Thousands)
Due in one year or less                            $ 2,303        $ 2,302
Due in one year through five years                  33,595         33,642
Due after five years through ten years                   0              0
Due after ten years                                 32,924         33,100
                                                   $68,822        $69,044


          Gross realized gains (losses) from the sale of
securities available-for-sale were $52,000 and ($97,000) during
1996, $71,000 and ($0) during 1995 and $0 and ($169,000) during
1994.

          At December 31, 1996 and 1995, securities having a book
value of $75,559,000 and $49,509,000 respectively, were pledged
to secure lines of credit, letters of credit, public deposits and
for other purposes as required by law.


<PAGE>



NOTE 3:  LOANS

          Loans are summarized as follows (in thousands):

                                                     December 31
                                                 1996          1995     
Real Estate loans
  Construction                                $ 5,990         $4,097 
  Secured conventional  
    Residential                                69,341         59,390 
    Nonresidential                            126,050        122,347 
Commercial and
      industrial loans                         73,171         68,479 
Loans to individuals  
      Automobile                                2,488          2,440 
      Revolving credit                            315            286 
      Other installment loans                   8,988          9,692 
All other loans                                 1,021            688 
Total loans                                  $287,364        267,419 
Less deferred loan fees                          (248)          (289)
Total loans net of deferred loan fees        $287,116       $267,130 


         Non-performing loans and non-performing assets include
the following (in thousands):

                                                       December 31   
                                                   1996         1995 

Non-accrual loans                                $ 8,384       $7,091
Accruing loans past due
      90 days or more                              1,349        3,123
Total non-performing loans                       $ 9,733      $10,214
Restructured loans(excluding amounts
      classified as non-performing loans)          3,934        5,105
Other real estate owned, net                         841          772
Total non-performing assets                      $14,508      $16,091

          If the non-accrual loans had continued to accrue
interest in accordance with their original contract terms,
interest income would have increased approximately $710,500,
$689,000 and $475,000, in 1996, 1995 and 1994, respectively.  No
interest income was collected on these loans subsequent to their
classification as non-accrual in 1996, 1995 and 1994.

          At December 31, 1996 and 1995, the recorded investment
in loans that are considered to be impaired under SFAS 114 was
$10,109,000 and $6,662,000, respectively.  The related allowance
for credit losses was $500,000 at December 31, 1996, and $770,000
at December 31, 1995.  The impaired loan portfolio is primarily
collateral dependent, as defined by SFAS 114.  The change in the
allowance for impaired loans represented a recovery of $270,000
during 1996 as compared to a provision of $123,000 during 1995. 
The average recorded investment in impaired loans during the
years ended December 31, 1996 and 1995 was approximately
$9,657,000 and $5,213,000, respectively.  For the years ended
December 31, 1996 and 1995, the Company recognized cash basis
interest income on these impaired loans of $265,500 and $70,000,
respectively.

          All loans to directors, executive officers, significant
shareholders and their related interests are current as to
principal and interest payments at December 31, 1996.  The
following summarizes the activity for related party loans for the
year ended December 31, 1996 (in thousands):


<PAGE>



Balance, beginning of year                               $2,178
Additions                                                   265
Payments                                                    685
Balance, end of year                                     $1,758

          The Bank is party to financial instruments with
off-balance-sheet risk in the normal course of business to meet
the financial needs of its customers.  These financial
instruments include commercial and standby letters of credit and
unused lines of credit and involve, to varying degrees, elements
of credit risk in excess of the amount recognized in the
statements of condition.  The contract or notional amounts of
these instruments express the extent of involvement the Bank has
in each class of financial instruments.

          The Bank's exposure to credit loss from non-performance
by the other party  to the above mentioned financial instruments
is represented by the contractual amount of those instruments. 
The Bank uses the same credit policies in making commitments and
conditional obligations as it does for on-balance-sheet
instruments.

          Unless otherwise noted, the Bank does not require
collateral or other security to support financial instruments
with off-balance-sheet credit risk.

                                                        Contract or
                                                      Notional Amount
Financial Instruments Whose Contract                at December 31,1996
Amounts Represent Credit Risk                         (in Thousands)

Commercial and standby letters of credit                    $ 3,742
Outstanding loan commitments-fixed rate                     $15,270
Outstanding loan commitments-variable rate                  $49,121

          Commercial and standby letters of credit are
conditional commitments issued by the Bank guaranteeing
performance by a customer to a third party.  Outstanding loan
commitments represent the unused portion of loan commitments
available to individuals and companies as long as there is no
violation of any condition established in the contract. 
Outstanding loan commitments generally have a fixed expiration
date of one year or less, except for home equity lines of credit
commitments which generally have an expiration date of 15 years. 
The Bank evaluates each customer's credit worthiness on a
case-by-case basis.  The amount of collateral obtained, if deemed
necessary by the Bank upon extension of credit, is based upon
management's credit evaluation of the customer.  Various types of
collateral may be held, including property and marketable
securities.

          The credit risk involved in these financial instruments
is essentially the same as that involved in extending loan
facilities to customers. 

NOTE 4:   ALLOWANCE FOR POSSIBLE LOAN LOSSES

          The allowance for possible loan losses is based upon
estimates, and ultimate losses may vary from the current
estimates.  These estimates are reviewed periodically and, as
adjustments become necessary, they are reported in earnings in
the periods in which they become known.

          The following summarizes the activity in the allowance
for possible loan losses (in thousands): 
                                      


<PAGE>

<TABLE>
                                                            Year Ended December 31,
                                                1996               1995               1994
<CAPTION>
<S>                                          <C>                 <C>                 <C>
Balance, beginning of year                   $ 7,402             $ 7,602             $11,252
Provisions charged to operations               1,350                 720                 450 
Loans charged-off                            ( 1,264)             (2,123)             (5,141)
Recoveries of charged-off loans                1,043               1,203               1,041 
Balance, end of year                         $ 8,531             $ 7,402             $ 7,602 

</TABLE>

          Approximately $2,696,000 of the $5,141,000 of loans
charged off during 1994 resulted from the sale of troubled loans. 
Additionally, approximately $500,000 of the $1,041,000 of
recoveries resulted from the settlement of certain claims made
under the Company's insurance policy for reimbursement of losses
arising from alleged loan irregularities discovered in February
1991.

          The allowance for loan losses for Federal income tax
purposes was $3,024,000 at December 31, 1996, $3,360,000 at
December 31, 1995 and $3,151,000 at December 31, 1994.


NOTE 5:   PREMISES AND EQUIPMENT

          The detail of premises and equipment is as follows (in
thousands):

                                                 December 31
                                          1996                    1995

Land                                         $ 1,309           $ 1,309
Building                                       8,550             8,416
Furniture and equipment                        7,609             7,153
Leasehold improvements                         4,058             3,981
                                             $21,526           $20,859
Less-Accumulated depreciation
   and amortization                           12,638            11,441
                                             $ 8,888           $ 9,418


NOTE 6:   INCOME TAXES

          The provision for income taxes (benefit) comprises the
following components (in thousands):

                                         Year Ended December 31
                                        1996       1995      1994

Federal
  Current tax expense                  $3,124    $2,126     $1,434 
  Deferred tax expense (benefit)         (334)      563     (1,051)
State
  Current tax expense                     696       106        164 
  Deferred tax expense                    (58)      336        221 
                                       $3,428    $3,131       $768 

          In accordance with SFAS 115 (See Note 1), deferred tax
expense (benefit) of $68,000,$143,000 and ($436,000) has been
provided through shareholders' equity to reflect unrealized gains
(losses) on available-for-sale securities at December 31,
1996,1995 and 1994, respectively.



<PAGE>



          The following is a reconciliation of the Federal income
tax expense as reported with the statutory Federal tax on income
before income taxes (in thousands):

                                             Year Ended December 31
                                        1996         1995         1994

Tax at statutory rate                 $ 2,958       $2,567       $1,855 
Tax exempt interest income                (15)         (38)         (31)
State income taxes, net of
      Federal tax benefit                 421          292          254 
Contributions and other                    31           34            0 
Valuation allowance                      (160)           0       (1,500)
Other, net                                193          276          190 
Total                                 $ 3,428       $3,131        $ 768 
Effective tax rate                       39.4%        41.5%        14.1%

          The tax effects of temporary differences that give rise
to significant portions of the deferred tax assets and deferred
tax liabilities are as follows (in thousands):

                                                      December 31

                                                      1996        1995
Deferred tax assets:
      Deferred fee income                          $    93       $  145 
  Allowance for possible loan losses                 2,228        1,708 
  Nonaccrual loan interest                           1,185        1,040 
  Allowance for losses on OREO                          38           38 
  Pension expense                                      440          383 
  Premises and equipment, principally
        due to differences in depreciation             789          696 
      Net operating loss carryforwards                   0          140 
      Other                                            110          518 
Total gross deferred tax asset                       4,883        4,668 
Valuation allowance                                   (270)        (430)
Total net deferred tax asset                       $ 4,613       $4,238 
Deferred tax liabilities:
      Investment securities, principally
        due to accretion of discounts              $    25       $   42 
      Unrealized gain-securities 
        available-for-sale                              75          143 
Total gross deferred tax liabilities               $   100      $   185 
Net deferred tax asset                             $ 4,513      $ 4,053 

          Management has projected that the Company will generate
sufficient taxable income to utilize the net deferred tax asset. 
There can be no assurance, however, that the Company will
generate any earnings or any specific level of continuing
earnings.

          The valuation allowance for deferred tax assets as of
December 31, 1996 and 1995 was $270,000 and $430,000,
respectively.  The net change in the total valuation allowance
for 1996 was a decrease of $160,000 which is the result of the
reduction of the Bank's state tax loss carry forward.  There was
no change in the valuation allowance for 1995.


<PAGE>



NOTE 7:  BENEFITS PLANS

PENSION PLAN:

          The Bank has a noncontributory defined benefit pension
plan which covers substantially all employees. Actuarial gains
and losses, if any, are amortized on a straight line basis over
the average expected future service of the active employees.  The
Company makes annual contributions to the plan equal to the
amount accrued for pension expense if deductible for tax
purposes.

          The following table sets forth the plan's funded status
and amounts recognized in the Company's consolidated financial
statements (in thousands):

                                                           December 31
                                                     1996             1995

Actuarial present value of benefit obligation 
  Accumulated benefit obligations,
  including vested benefits of $2,425 and
  $1,662 in 1996 and 1995, respectively            $2,554             $1,797 
Plan assets at fair value, primarily
  listed stocks, U.S. Bonds, and
  commingled funds                                 $4,141              $3,387 
Projected benefit obligation for service
  rendered to date                                  4,874               3,375 
Plan assets greater (less) than projected 
  benefit obligation                                 (733)                 12 
Unrecognized net loss due to past experience
  different from assumptions made and effects
  of changes in assumptions                          (218)               (801)
Unrecognized prior service cost                       211                 238 
Unrecognized transition asset being amortized
  over 15 years                                      (146)               (170)
Accrued pension cost included in other
  liabilities                                       $(886)              $(721)

 
          Net pension cost for 1996, 1995 and 1994 included the
following components (in thousands):

                                           Year Ended December 31 
                                       1996          1995         1994

Service cost-benefits earned
  during the year                     $ 543         $ 387        $ 386 
Interest cost on projected
  benefit obligation                    289           250          222 
Actual (return) loss
  on plan assets                       (377)         (697)         124 
Net deferral and amortization            68           448         (403)
Net pension cost                       $523         $ 388        $ 329 

     In determining the projected benefit obligation, the
weighted average assumed discount rate was 7% for 1996 and 8% for
1995 and 1994, respectively, while the rate of increase in future
salary levels was 5% for 1996, 1995 and 1994, respectively.  The
expected long term rate of return on <PAGE> assets, used in determining
the net period pension cost was 8% for all years presented.

     Effective in 1995, the Bank established a non-qualified
deferred compensation plan for certain officers.  All benefits
provided under this plan are unfunded.  As of December 31, 1996,
approximately $138,000 was included in accrued expense for this
plan.  For the year ended December 31,1996 and 1995, expenses
related to this plan were $51,000 and $87,000, respectively.

401K PLAN:

     The Bank sponsors a 401k Plan which provides several tax
deferred investment opportunities to salaried employees of the
Bank who have satisfied the service requirements of the Plan. 
The Plan allows eligible employees to make periodic contributions
of certain percentages of their salary, subject to the Internal
Revenue Code limits on maximum annual contributions.  The Bank
matches part of these contributions.  The Bank's matching
contribution expense was $62,300, $65,100 and $61,000 for 1996,
1995, and 1994, respectively.

NOTE 8: STOCK COMPENSATION PLANS:

     At December 31, 1996, the Company had five stock based
compensation plans, which are described below.  The Company
applies APB Opinion No. 25 and related interpretations in
accounting for its plans.  Accordingly, no compensation cost is
recognized for its stock option plans.  Had compensation cost for
the Company's five stock -based compensation plans been
determined consistent with SFAS NO.123, the Company's net income
and earnings per share would have been reduced to the proforma
amounts indicated below (in thousands, except per share amounts):

                                               1996        1995

Net income       As  Reported                 $5,273       $4,420
                 Pro  forma                   $5,152       $4,368

Primary earnings As Reported                   $1.13        $1.16
per share        Pro forma                     $1.11        $1.15

Fully diluted    As Reported                   $1.10        $0.93
earnings per 
share            Pro forma                     $1.08        $0.92


     The fair value of each option grant is estimated on the date
of grant using the Black-Scholes option-pricing model with the
following weighted-average assumptions used for grants in 1996,
and 1995, respectively: dividend yield of 2.4 percent and 2.3
percent; expected volatility of 45 percent for both periods;
risk-free interest rates of 6.7 percent, and 7.0 percent for the
1993 Non-Statutory Plan options, 6.3 percent, and 5.7 percent for
the 1993 and 1996 Incentive Plan options; and expected lives of 8
years for both periods for the 1993 Non-Statutory Plan options,
and 7 years for both periods for the 1993 and 1996 Incentive Plan
options.  The effects of applying SFAS 123 on the pro forma net
income may not be representative of the effects on the pro forma
net income for future years.


<PAGE>



STOCK OPTION PLANS:

     The Company has five option plans.  The 1986 Incentive Stock
Option Plan expired April 16, 1996.  No additional options are
available for granting under this plan.  The 36,039 options
issued and outstanding prior to April 16,1996 remain available
for exercise until their expiration dates.  

     Under the 1993 Broad National Incentive Stock Option Plan
(1993 Incentive Plan), the Company may grant options to its
management personnel for up to 231,000 shares of common stock.

     Under the 1993 Broad National Directors Non-Statutory Stock
Option Plan (1993 Non-Statutory Plan), the Company may grant
options to its directors for up to 86,625 shares of common stock.

     Under the 1996 Broad National Bancorporation Incentive Stock
Option Plan (1996 Incentive Plan), the Company may grant options
to its management personnel for up to 200,000 shares of common
stock.

     Under the 1996 Broad National Bancorporation Directors Non-
Statutory Stock Option Plan (1996 Non-Statutory Plan), the
Company may grant options to its directors for up to 75,000
shares of common stock.  

     Both the 1996 Incentive Stock Option Plan and the 1996 Non-
Statutory Stock Option Plan were approved by the Company's Board
of Directors in December 1996, but remain subject to shareholder
approval at the Company's 1997 Annual Meeting of Shareholders. 
26,000 options granted under the 1996 Incentive Stock Option Plan
were subject to such shareholder approval at December 31, 1996.

     Under all plans, the exercise price of each option is no
less than the market price of the Company's stock on the date of
grant, and an option's maximum term is ten years.

     Options granted under the 1993 and 1996 Non-Statutory Plans
vest at the expiration of two years from the granting date.

     Vesting under the 1993 and the 1996 Incentive Plans is
subject to the authority of the committee which administers these
plans, and all options granted to date under these plans vest 40%
at the end of the second year and 20% each year over the next
three years.



<PAGE>



     A summary of the status of the Company's stock option plans
as of December 31, 1994, 1995 and 1996, and changes during the
years ended on those dates is presented below: 

                                          Shares Under      Weighted-Avg.
                                             Option       Exercise Price

Outstanding at December 31, 1993             170,964                $6.14
Granted in 1994                               72,957                 6.38
Expired unexercised in 1994                  ( 5,526)                6.63
Outstanding at December 31, 1994             238,395                 6.20
Exercised in 1995                             (3,572)                5.25
Granted in 1995                               83,050                 8.67
Expired unexercised in 1995                  ( 2,143)                8.95
Outstanding at December 31, 1995             315,730                 6.84
Exercised in 1996                            (18,098)                5.43
Granted in 1996                               77,150                12.16
Expired unexercised in 1996                  ( 7,593)                6.89
Outstanding at December 31, 1996             367,189                 8.03

Weighted-average fair value                    1996                 1995
of options granted during the year            $5.30                 $4.09




<TABLE>


The following table summarizes information about stock options outstanding at December 31,
1996:

                                Options Outstanding               Option Exercisable

                                           Weighted-Avg.    Weighted                     Weighted
      Range                     Number       Remaining       -Avg.        Number          -Avg.  
       of                    Outstanding    Contractual     Exercise    Exercisable      Exercise
Exercise Prices              at 12/31/96        Life         Price      at 12/31/96       Price  

<CAPTION>

<S>                          <C>           <C>              <C>        <C>               <C>
$ 5.84 - $6.78                 196,308        5.9 years     $ 6.11        130,441        $ 6.05
  7.02 -  8.64                  71,830        8.9             8.34          6,930          7.02
  9.50 - 10.01                  29,051        4.8             9.69          5,951         10.01
 12.13 - 13.34                  70,000        8.9            12.39              0          0.00
$ 5.84 -$13.34                 367,189        7.0           $ 8.03        143,322        $ 6.27


</TABLE>


NOTE 9:  SHORT-TERM BORROWINGS

     Details with respect to other short-term borrowings are as
follows (in thousands):

                                                         December 31
                                                    1996          1995

Balance, end of year                              $ 1,000        $   782 
Maximum outstanding during the year
  at any month end                                $ 1,282        $21,345 
Average interest rate, end of year                   4.95%          5.69%
Average outstanding during the year               $ 1,149        $ 2,808 
Average interest rate for the year                   4.97%          6.02%

     The average amounts outstanding were computed primarily from
daily averages and the average interest rate for the year and at
the end of the year were computed by dividing the respective
interest expenses by the average balances outstanding.

     The Bank has available $23,750,000 in lines of credit with
correspondent banks.  At December 31, 1996, these line of credit
were not in use.


<PAGE>



NOTE 10:  COMMITMENTS AND CONTINGENCIES

     In the ordinary course of business, the Company and the Bank
may be a party to outstanding legal proceedings and claims.  In
its judgement, management does not believe that the Company's
consolidated financial position or results of operations will be
materially affected by any of these present proceedings.

     Cash balances reserved to meet the requirements of the bank
regulatory authorities amounted to $9,408,000 at December 31,
1996.

     The Bank has lease commitments on certain of its branches
expiring at various dates through 2006.  Rental expense on these
leases charged to operations amounted to $544,000, $567,000 and
$519,000 for the years ended December 31, 1996, 1995, and 1994,
respectively.  The minimum annual rentals under the terms of the
leases as of December 31, 1996 were as follows:

                                        1997             $429,000
                                        1998              332,000
                                        1999              251,000
                                        2000              189,000
                                        2001              129,000 
                                  Thereafter               77,000


NOTE 11:  SHAREHOLDERS' EQUITY

Stock dividends:

     On September 20, 1996, the Board of Directors of the Company
declared a 10% stock dividend which was distributed October 3,
1996.

     On November 17, 1994, the Board of Directors of the Company
declared a 5% stock dividend which was distributed December 16,
1994 to shareholders of record two weeks prior thereto.

     All per share data included in the accompanying financial
statements and notes thereto reflect the retroactive effect of
these stock dividends.

PREFERRED STOCK 1992 CLASS: 

     On January 29, 1993 the Company completed its Rights
Offering of 8-1/2% Cumulative Convertible Preferred Stock 1992
Class, $1.00 par value ("1992 Preferred Stock").  All 690,000
shares of the 1992 Preferred Stock were sold at a price of $10.00
per share.

     On November 16, 1995, the Board of Directors of the Company
called for redemption 250,000 shares of the 1992 Preferred Stock. 
Additionally, on January 18, 1996, the Board of Directors of the
Company called for redemption all of the remaining outstanding
shares of the 1992 Preferred Stock.  On April 8, 1996, the
Company completed the redemption of the 1992 Preferred Stock.  As
a result of the redemption programs, 3,750 shares of 1992
Preferred Stock were redeemed at the price of $10.60 per share,
for a total redemption price of $43,750.  In lieu of redemption,
558,803 shares of 1992 Preferred Stock were converted into
1,066,616 shares of common stock.  Cash was paid for fractional
shares resulting from conversion.

PREFERRED STOCK 1985 CLASS:

     On December 31, 1985, the Company issued 20,000 shares of
nonvoting, 9% Cumulative Convertible Preferred Stock-1985 Class
("1985 Preferred Stock").  



<PAGE>



     On November 16, 1995, the Board of Directors of the Company
called for redemption all of the outstanding shares of the 1985
Preferred Stock.  The redemption of the 1985 Preferred Stock was
completed on January 7, 1996 and 197 shares of the 1985 Preferred
Stock were redeemed at a price of $38 per share, for a total
redemption price of $7,486.  In lieu of redemption, 16,927 shares
of the 1985 Preferred Stock were converted into 109,916 shares of
common stock.  Cash was paid for fractional shares resulting from
conversion.

STOCK BUYBACK PROGRAM:

     On November 21, 1996, the Board of Directors of the Company
authorized the repurchase of up to 100,000 of its outstanding
common shares.  These repurchases will be made from time to time
in the open market, subject to prevailing conditions and in a
manner to avoid disrupting the market.  Purchasing activities may
be discontinued and resumed at any time, as market conditions
warrant.  The repurchased shares will be held in treasury and may
be used by the Company for general corporate purposes including
stock-based employee benefit plans and stock dividends.

     At December 31, 1996, the Company had repurchased 5,000
shares of common stock at a cost of $57,500.


NOTE 12: REGULATORY MATTERS

     Capital adequacy for the Company is measured against
regulations established by the Federal Reserve Board (FRB).  The
Bank is subject to generally similar capital regulations adopted
by the Office of the Comptroller of the Currency (the OCC). 
These regulations require the Company and the Bank to maintain
minimum levels of regulatory capital.  Under the regulations in
effect at December 31,1996, the Company and the Bank were
required to maintain (i) a minimum leverage ratio of Tier 1
capital to total adjusted assets of 4.0%, and (ii) minimum ratios
of Tier 1 and total capital to risk-weighted assets of 4.0% and
8.0%, respectively.

     Under its prompt corrective action regulations, the FDIC is
required to take certain supervisory actions ( and may take
additional discretionary actions) with respect to an
undercapitalized institution.  Such actions could have a direct
material effect on the institution's financial statements.  The
regulations establish a framework for the classification of
financial institutions into five categories: well capitalized,
adequately capitalized, undercapitalized, significantly
undercapitalized, and critically undercapitalized.  Generally, an
institution is considered well capitalized if it has a
leverage(Tier 1) capital ratio of at least 5.0%; a Tier 1 risk-
based capital ratio of at least 6.0%; and a total risk-based
capital ratio of at least 10.0%.

     The foregoing capital ratios are based in part on specific
quantitative measures of assets, liabilities and certain off-
balance sheet items as calculated under regulatory accounting
practices.  Capital amounts and classifications are also subject
to qualitative judgments by the FRB, the OCC and the FDIC about
capital components, risk weightings and other factors.

     Management believes that, as of December 31, 1996, the
Company and the Bank meet all capital adequacy requirements to
which they are subject.  Further, the most recent FDIC
notification categorized the Bank as a well-capitalized
institution under the prompt corrective action regulations. 
There have been no conditions or events since that notification
that management believes have changed the Bank's capital
classification.

     The following is a summary of the Company's and the Bank's
actual capital amounts and ratios as of December 31, 1996 and
1995, compared to the regulatory minimum capital adequacy
requirements and the regulatory requirements for classification
as a well-capitalized institution:

<PAGE>

<TABLE>

                                                                     Regulatory Requirements

                                                                    Minimum Capital                     For Classification
                                                                                                               as Well
                                    Company Actual                     Adequacy                               Capitalized
                            Amount                Ratio       Amount                Ratio               Amount            Ratio
                                                                     (Dollars in Thousands)

<CAPTION>
<S>                         <C>                   <C>          <C>                 <C>                 <C>                <C>
December 31, 1996
Leverage (Tier 1) 
  capital                   $37,512                6.92%       $21,676              4.00%              $27,095              5.00%
Risk-based capital
   Tier 1                   $37,512               11.17%       $13,434              4.00%              $20,151              6.00%
   Total                    $41,764               12.44%       $26,868              8.00%              $33,585             10.00%
December 31, 1995
Leverage (Tier 1) 
  capital                   $33,545                7.17%       $18,724              4.00%              $23,404              5.00%
Risk-based capital:
   Tier 1                   $33,545               10.58%       $12,680              4.00%              $19,020              6.00%
   Total                    $37,550               11.85%       $25,360              8.00%              $31,700             10.00%


</TABLE>




<TABLE>
                                                                     Regulatory Requirements

                                                                    Minimum Capital                     For Classification
                                                                                                               as Well
                                    Company Actual                     Adequacy                               Capitalized
                            Amount                Ratio       Amount                Ratio               Amount            Ratio
                                                                     (Dollars in Thousands)


<CAPTION>
<S>                         <C>                   <C>          <C>                 <C>                 <C>                <C>
December 31, 1996
Leverage (Tier 1) 
  capital                   $36,939                6.82%       $21,676              4.00%              $27,095              5.00%
Risk-based capital
   Tier 1                   $36,939               11.00%       $13,434              4.00%              $20,151              6.00%
   Total                    $41,191               12.26%       $26,868              8.00%              $33,585             10.00%
December 31, 1995
Leverage (Tier 1) 
  capital                   $32,779                7.00%       $18,724              4.00%              $23,404              5.00%
Risk-based capital:
   Tier 1                   $32,779               10.34%       $12,680              4.00%              $19,020              6.00%
   Total                    $36,784               11.60%       $25,360              8.00%              $31,700             10.00%
</TABLE>

NOTE 13: SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

     The following quarterly financial information for the two
years ended December 31, 1996 and 1995, is unaudited.  However,
in the opinion of management all adjustments, which include only
normal recurring adjustments necessary to present fairly the
results of operations for the periods, are reflected.  Results of
operations for these three-month periods are not necessarily
indicative of the results for the entire year or any other
interim period (in thousands, except per share amounts):

<TABLE>
                                                             1996
                                    March              June      September           December

<CAPTION>
<S>                                <C>                 <C>        <C>                <C>
Interest income                    $8,104              $8,474      $9,060              $9,524
Interest expense                    2,613               2,658       3,118               3,429
Provision for possible 
  loan losses                         225                 225         450                 450
Non-interest income                 1,072               1,306       1,685               2,493
Non-interest expenses               4,700               5,076       5,007               5,066
Net income                          1,037               1,127       1,262               1,847
Net income per common 
  share:
   Primary earnings 
    per common share               $ 0.24              $ 0.24      $ 0.26              $ 0.39
   Fully diluted 
    earnings per
    common share                   $ 0.22              $ 0.23      $ 0.26              $ 0.39
</TABLE>   

<PAGE>

<TABLE>

                                                               1995
                                    March               June     September            December

<CAPTION>
<S>                                <C>                 <C>       <C>                  <C>
Interest income                    $7,999              $8,400      $8,500              $8,499
Interest expense                    2,142               2,612       2,690               2,638
Provision for possible 
  loan losses                         100                 120         120                 380
Non-interest income                 1,013               1,103       1,176               1,199
Non-interest expenses               5,031               5,085       4,690               4,730
Net income                          1,008                 973       1,279               1,160
Net income per common 
  share:
   Primary earnings 
    per common share               $ 0.26              $ 0.26      $ 0.34              $ 0.30
   Fully diluted 
    earnings per
    common share                   $ 0.22              $ 0.20      $ 0.27              $ 0.24

</TABLE>

NOTE 14:  FAIR VALUES OF FINANCIAL INSTRUMENTS

     Statement of Financial Accounting Standards No. 107,
"Disclosures About Fair Value of Financial Instruments" ("SFAS
107") requires that the Company disclose estimated fair values
for its financial instruments whether or not recognized in the
Statement of Financial Condition. 

     Limitations: The fair value estimates made at December 31,
1996 and 1995 were based on pertinent market data and relevant
information on the financial instrument at that time.  These
estimates do not reflect any premium or discount that could
result from offering for sale at one time the entire portion of
the financial instruments.  Because no market exists for a
portion of the financial instruments, fair value estimates may be
based on judgments regarding future expected loss experience,
current economic conditions, risk characteristics of various
financial instruments, and other factors.  These estimates are
subjective in nature and involve uncertainties and matters of
significant judgment and therefore cannot be determined with
precision.  Changes in assumptions could significantly affect the
estimates.

     Fair value estimates are based on existing on-and-off
balance sheet financial instruments without attempting to
estimate the value of anticipated future business and the value
of assets and liabilities that are not considered financial
instruments.  In addition, the tax implications related to the
realization of the unrealized gains and losses can have a
significant effect on fair value estimates and have not been
considered in many of the estimates.

     Fair value estimates, methods and assumptions are set forth
below for the Company's financial instruments (in thousands):

<TABLE>
                                                        At December 31, 
                                         1996                               1995
                                             Estimated                               Estimated
                                  Carrying     Fair             Carrying                Fair
                                   Amount     Value              Amount                Value
<CAPTION>
<S>                               <C>        <C>               <C>                   <C>
Financial Assets
 Cash and short-term 
   investments                    $ 76,857   $ 76,857            $ 87,110             $87,110
 Securities held-to-
   maturity                         90,170     89,482              60,266              59,948
 Securities available-
  for-sale                          69,044     69,044              55,946              55,946
 Loans, net                        278,585    281,052             259,728             261,858
Financial Liabilities
 Deposits                          485,073    485,042             429,681             429,995
 Short term borrowings               1,000      1,000                 782                 782

</TABLE>

     The following methods and assumptions were used to estimate
the fair value of each class of financial instrument:



<PAGE>


CASH AND SHORT-TERM INVESTMENTS

     The carrying amount approximates fair value.

INVESTMENT SECURITIES

     The fair values are based on quoted market prices obtained
from outside sources.

LOANS

     The fair value of the loan portfolio was estimated using the
discounted value of the future cash flows expected to be received
using a market discount rate.  For loans that have short-term
maturities or that reprice to market rates, the carrying value
was used as an estimate of fair value.

DEPOSIT LIABILITIES

     The fair value of deposits is equal to the amount payable on
demand at the reporting dates except for the fair value of fixed
maturity certificates of deposit which were estimated by
discounting the value of the future cash flows expected to be
paid on deposits.

SHORT TERM BORROWINGS

     The carrying amount approximates fair value.

COMMITMENTS TO EXTEND CREDIT AND LETTER OF CREDIT

     The fair market value of unearned fees associated with
financial instruments with off-balance sheet risk at December 31,
1996 approximates the fees received.   Amount is not material.

NOTE 15:  CONDENSED FINANCIAL INFORMATION OF BANCORPORATION
(PARENT COMPANY ONLY)

     Condensed Statements of Condition (in thousands): 
                                                December 31,
                                             1996         1995  
Assets   
 Cash, principally on deposit with                          
   subsidiary bank                                   $   684      $   220
  Investment in subsidiary                            37,784       33,763
  Other assets                                           375          975
Total Assets                                         $38,843      $34,958
Liabilities and Shareholders' Equity 
  Other liabilities                                  $   485      $  429 
  Shareholders' equity                                38,358       34,529
Total Liabilities and Shareholders' 
 Equity                                              $38,843      $34,958


<PAGE>


     Condensed Statements of Income for the years ended December
31, 1996, 1995 and 1994 (in thousands):

                                                         December 31,
                                               1996        1995           1994
Income 
Equity in undistributed income
  of subsidiary                             $ 4,160       $2,782         $3,860
Dividends received from banking
  subsidiary                                  1,230        1,818            945
                                            $ 5,390       $4,600         $4,805
Expenses 
Salaries and related benefits               $    39       $   39         $   39
Other                                            78          141             77
                                            $   117       $  180         $  116
Net income                                  $ 5,273       $4,420         $4,689 


     Condensed Statements of Cash Flows for the years ended
December 31, 1996, 1995 and 1994 (in thousands):

                                                 December 31,
                                     1996            1995           1994
Cash flows from operating 
  activities:
Net income                          $5,273          $4,420         $4,689 
Less-
Equity in undistributed income
  of subsidiary                     (4,160)        (2,782)        (3,860)
Increase in other liabilities           56            123             73 
Other, net                             601           (975)           (56)
Net cash provided by operating
  activities                        $1,770         $  786         $  846 
Cash flows from investing 
  activities:
Investments in and advances 
  to subsidiary                      $   0         $    0         $ (600)
Net cash used in investing 
  activities                         $   0         $    0         $ (600)
Cash flows from financing 
  activities:
Redemption of preferred stock       $  (52)         $   0         $    0 
Proceeds from issuance of 
  common stock                          98             18              0 
Dividends to shareholders           (1,294)        (1,175)        (1,071)
Purchase of treasury stock             (58)             0              0 
Net cash used in 
  financing activities             $(1,306)       $(1,157)       $(1,071)
Net increase (decrease) in 
  cash and cash equivalents            464           (371)          (825)
Cash and cash equivalents-
  beginning of year                    220            591          1,416 
Cash and cash equivalents-
  end of year                      $   684         $  220         $  591 



ITEM 9.   CHANGES IN AND DISAGREEMENTS ON ACCOUNTING AND
          FINANCIAL DISCLOSURE.

          None.

<PAGE>


                             PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

          Pursuant to General Instruction G(3) to Form 10-K, the
information required by this Item (except for the information set
forth in Item 4A of Part I hereof with respect to the
Registrant's executive officers) is incorporated herein by
reference to (i) the information under the caption "Election of
Directors" (except that the information set forth under the
following subcaptions thereunder is expressly excluded from such
incorporation:  "Compensation of Directors" and "Meetings of the
Board and Committees") and (ii) the information under the caption
"Compliance with Section 16(a) of the Securities Exchange Act of
1934," in each case, in the Registrant's definitive Proxy
Statement for its 1997 Annual Meeting of Shareholders to be filed
pursuant to Regulation 14A.

ITEM 11.  EXECUTIVE COMPENSATION.

          Pursuant to General Instruction G(3) to Form 10-K, the
information required by this Item is incorporated herein by
reference to the information under the caption "Executive
Compensation and Other Information" (except that the information
set forth under the following subcaptions thereunder is expressly
excluded from such incorporation:  "Compensation Committee and
Board of Directors Report on Executive Compensation" and "Company
Performance") in the Registrant's definitive Proxy Statement for
its 1997 Annual Meeting of Shareholders to be filed pursuant to
Regulation 14A.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
          MANAGEMENT.

          Pursuant to General Instruction G(3) to Form 10-K, the
information required by this Item is incorporated herein by
reference to the information under the caption "Ownership of
Bancorporation Capital Stock" in the Registrant's definitive
Proxy Statement for its 1997 Annual Meeting of Shareholders to be
filed pursuant to Regulation 14A.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

          Pursuant to General Instruction G(2) to Form 10-K, the
information required by this Item is incorporated herein by
reference to the information under the caption "Transactions With
Management and Others" in the Registrant's definitive Proxy
Statement for its 1997 Annual Meeting of Shareholders to be filed
pursuant to Regulation 14A.


<PAGE>



                             PART IV

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

          (a)  Exhibits and Financial Statement Schedules:

     1.  The following consolidated financial statements of the
Registrant and subsidiaries and report of the Registrant's
independent auditors included in Item 8 to this report:

          Independent Auditors' Report as of December 31,
     1996 and 1995 and for the years ended December 31,
     1996, 1995 and 1994.

          Consolidated Statements of Condition as of
     December 31, 1996 and 1995.

          Consolidated Statements of Income for each of the
     years ended December 31, 1996, 1995 and 1994.

          Consolidated Statements of Changes in
     Shareholders' Equity for the years ended December 31,
     1996, 1995 and 1994.

          Consolidated Statements of Cash Flows for each of
     the years ended December 31, 1996, 1995 and 1994.

          Notes to Consolidated Financial Statements

     2.  Financial Statement Schedules:  All schedules are
omitted because they are not applicable, or not required, or
because the required information is included in the financial
statements or the notes thereto.

     3.  Exhibits:

NUMBER                        DESCRIPTION                   

 3.1      Restated Certificate of Incorporation of the Registrant
          as amended through and including June 29, 1995 (filed
          as Exhibit 3 to the Registrant's Form 10-Q for the
          quarter ended March 31, 1996 and incorporated by
          reference herein).

 3.2      Bylaws of the Registrant, as amended to date (filed as
          Exhibit 3(d) to the Registrant's Form 10-K Report for
          the fiscal year ended December 31, 1989 and
          incorporated herein by reference).

10.1      Lease between The Prudential Insurance Company of
          America and Broad National Bank dated as of December
          15, 1988 (filed as Exhibit 3(e) to the Registrant's
          Form 10-K Report for the fiscal year ended December 31,
          1989 and incorporated herein by reference).

10.1.1    Amendment of Lease between The Prudential Insurance
          Company of America and Broad National Bank dated as of
          February 7, 1996 (filed as Exhibit 10.1.1 to the


<PAGE>

          Registrant's Form 10-K Report for the fiscal year ended
          December 31, 1995 and incorporated herein by
          reference).

10.2      Lease between Third Newark Gateway Urban Renewal
          Association and Broad National Bank, dated September 7,
          1984 (filed as Exhibit 10(b) to Registration Statement
          No. 33-01560 and incorporated herein by reference).

10.3      Lease between O. Navigador Bar, Inc. and Broad National
          Bank (filed as Exhibit 10(c) to Amendment No. 1 to
          Registration Statement No. 2-78220 and incorporated
          herein by reference).

10.4      Lease between Millburn Common Associates and Broad
          National Bank dated June 16, 1976, and Amendment to
          such Lease, dated September 10, 1985 (filed as Exhibit
          10(d) to Registration Statement No. 33-01560 and
          incorporated herein by reference).

10.5      Lease between Cada Holding Corp. and Broad National
          Bank dated October 8, 1976 (filed as Exhibit 10(e) to
          Amendment No. 1 to Registration Statement No. 2-78220
          and incorporated herein by reference).

10.6      Lease between Euro Associates and Broad National Bank
          acknowledged by the parties on December 12, 1985 and
          December 10, 1985 (filed with Amendment No. 2 to the
          Registrant's Registration Statement No. 33-53658 as
          Exhibit 10.6 and incorporated herein by reference).

10.7      Workletter Agreement between Euro Associates and Broad
          National Bank (filed with Amendment No. 2 to the
          Registrant's Registration Statement No. 33-53658 as
          Exhibit 10.7 and incorporated herein by reference).

10.8      Lease between 1000 South Elmora Associates and Broad
          National Bank dated May 18, 1986 (filed with Amendment
          No. 2 to the Registrant's Registration Statement No.
          33-53658 as Exhibit 10.8 and incorporated herein by
          reference).

10.9      Lease between Convery Associates and Broad National
          Bank dated July 1, 1987, and Rider to Lease Agreement,
          dated September 1, 1992 (filed with Amendment No. 2 to
          the Registrant's Registration Statement No. 33-53658 as
          Exhibit 10.10 and incorporated herein by reference).

10.10     Lease Agreement and Amendment between 466 Bloomfield
          Avenue Associates, Inc. and Broad National Bank dated
          February 9, 1988 (filed as Exhibit 10(l) to the
          Registrant's Form 10-K Report for the fiscal year ended
          December 31, 1989 and incorporated herein by
          reference).

10.11     Lease Agreement between George Zeik and Broad National
          Bank dated September 1, 1989 (filed as Exhibit 10(m) to
          the Registrant's Form 10-K Report for the fiscal year


<PAGE>



          ended December 31, 1989 and incorporated herein by
          reference).

10.12     Lease between Broad National Realty Corporation and
          Broad National Bank dated May 1, 1990 (filed as Exhibit
          10(n) to the Registrant's Form 10-K for the fiscal year
          ended December 31, 1990 and incorporated by reference
          herein).

10.12.1   Rider to Lease Agreement between Broad National Realty
          and Broad National Bank dated December 21, 1993 (filed
          as Exhibit 10.13.1 to the Registrant's Form 10-K for
          the fiscal year ended December 31, 1993 and
          incorporated herein by reference).

10.13     Broad National Bank Employees' Retirement Plan (filed
          as Exhibit 10(g) to Registration Statement No. 2-78220
          and as Exhibit 10(f) to Amendment No. 1 to Registration
          Statement No. 2-78220 and incorporated herein by
          reference).*

10.14     Form of Amendment to Sections 2.1 and 3.1(c) of the
          Broad National Bank Employees' Retirement Plan (filed
          as Exhibit 10(p) to the Registrant's Form 10-K for the
          fiscal year ended December 31, 1990 and incorporated by
          reference herein).*

10.15     Description of Bonus Plan for Designated Officers and
          Employees (appears on page 10 of the Registrant's
          definitive proxy statement for its 1991 Annual Meeting
          of Shareholders and is incorporated herein by
          reference).*

10.16     Incentive Stock Option Plan for certain employees
          adopted on March 26, 1987, and amended April 27, 1989
          (filed as Exhibit 10.18 to the Registrant's Form 10-K
          for the fiscal year ended December 31, 1992 and
          incorporated by reference herein).*

10.17     Non-Statutory Stock Option Plan for directors adopted
          on March 26, 1987 (filed with Amendment No. 2 to the
          Registrant's Registration Statement No. 33-53658 as
          Exhibit 10.19 and incorporated herein by reference).*

10.18     Employment Agreement between Donald M. Karp and the
          Registrant dated December 31, 1996.*

10.19     Employment Agreement by and between John A. Dorman,
          Broad National Bank and the Registrant, dated December
          31, 1996.*

10.20     Consultant Agreement between Stanley J. Lesnik and the
          Registrant dated November 16, 1995 (filed as Exhibit
          10.20 to the Registrant's Form 10-K for the fiscal year
          ended December 31, 1995 and incorporated herein by
          reference).*

10.21     Lease between Broad National Bank, landlord, and
          Newtrend L.P., tenant, dated August 10, 1993 (filed as
          Exhibit <PAGE> 10.22 to the Registrant's Form 10-K for the
          fiscal year ended December 31, 1993 and incorporated
          herein by reference).

10.22     Newtrend Service Bureau Agreement between Newtrend,
          Inc. and Broad National Bank dated August 10, 1993
          (filed as Exhibit 10.23 to the Registrant's Form 10-K
          for the fiscal year ended December 31, 1993 and
          incorporated herein by reference).

10.23     Newtrend Item Processing Addendum between Newtrend,
          Inc. and Broad National Bank dated August 10, 1993
          (filed as Exhibit 10.24 to the Registrant's Form 10-K
          for the fiscal year ended December 31, 1993 and
          incorporated herein by reference).

10.24     1993 Broad National Incentive Stock Option Plan for
          certain employees adopted on September 19, 1994 (filed
          as Exhibit 10.24 to the Registrant's Form 10-K Report
          for the fiscal year ended December 31, 1994 and
          incorporated herein by reference).*

10.25     1993 Broad National Directors Non-Statutory Stock
          Option Plan for directors adopted on September 19, 1994
          (filed as Exhibit 10.25 to the Registrant's Form 10-K
          Report for the fiscal year ended December 31, 1994 and
          incorporated herein by reference).*

10.26     Lease between Lucky Realty LLC and Broad National Bank
          (filed as Exhibit 10.26 to the Registrant's Form 10-K
          Report for the fiscal year ended December 31, 1995 and
          incorporated herein by reference).

10.27     Lease between A.J. Seabra Supermarkets V, Inc. and
          Broad National Bank dated as of April 20, 1995 (filed
          as Exhibit 10.27 to the Registrant's Form 10-K Report
          for the fiscal year ended December 31, 1995 and
          incorporated herein by reference).

10.28     1996 Broad National Bancorporation Incentive Stock
          Option Plan for certain employees adopted on December
          19, 1996 and subsequently amended on January 16, 1997.*

10.29     1996 Broad National Bancorporation Directors Non-
          Statutory Stock Option Plan for directors adopted on
          December 19, 1996.*

10.30     Broad National Bank Long-Term Capital Accumulation Plan
          for certain employees adopted on October 19, 1995.*

10.31     Broad National Bank Deferred Compensation Plan for
          certain employees and directors adopted on October 19,
          1995.*

10.32     Broad National Bank Management Incentive Plan for
          certain employees adopted on October 19, 1995.*


<PAGE>



11        Statement re Computation of Net Income Per Share.

22        List of Subsidiaries (filed with Amendment No. 3 to the
          Registrant's Registration Statement No. 33-53658 as
          Exhibit 22 and incorporated herein by reference).

24        Consent of KPMG Peat Marwick LLP with regard to
          Bancorporation's Registration Statement on Form S-8
          (Reg. No. 33-28183).  

27        Financial Data Schedule.
______________________

*    Management contracts or compensatory plans or arrangements
     required to be identified by Item 14(a)(3).

          (b)  Reports on Form 8-K

               No reports on Form 8-K were filed during the last
               quarter of 1996.

          (c)  Exhibits

               See Exhibits identified above under Item 14(a)(3). 

          (d)  Financial Statement Schedules

               See Item 14(a)(2) above.



<PAGE>


                            SIGNATURES



          Pursuant to the requirements of Section 13 or 15(d) 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.

                         BROAD NATIONAL BANCORPORATION


                         By /s/ Donald M. Karp         
                            Donald M. Karp
                            Chairman of the Board and
                            Chief Executive Officer

Dated: March 20, 1997

          Pursuant to the requirements of the Securities Exchange
Act of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on
the dates indicated:

          SIGNATURE AND TITLE                     DATE


/s/ Donald M. Karp                           March 20, 1997
Donald M. Karp, Director, Chairman
   of the Board and Chief Executive
   Officer (Principal Executive Officer)


/s/ John A. Dorman                           March 20, 1997
John A. Dorman, Director, President
   and Chief Operating Officer


/s/ James Boyle                              March 20, 1997
James Boyle, Treasurer and Comptroller
   (Principal Financial and Accounting
   Officer)


/s/ Licinio Cruz                             March 20, 1997
Licinio Cruz, Director

<PAGE>


/s/ Arthur Fischman                          March 20, 1997
Arthur Fischman, Director


/s/ John J. Iannuzzi                         March 20, 1997
John J. Iannuzzi, Director


/s/ James J. Lazarus                         March 20, 1997
James J. Lazarus, Director


/s/ Edward J. Lenihan                        March 20, 1997
Edward J. Lenihan, Director


/s/ Stanley J. Lesnik                        March 20, 1997
Stanley J. Lesnik, Director


/s/ Louis J. Owen                            March 20, 1997
Louis J. Owen, Director


/s/ Catherine McFarland                      March 20, 1997
Catherine McFarland, Director


/s/ A. Harold Schwartz                       March 20, 1997
A. Harold Schwartz, Director


/s/ Hubert Williams                          March 20, 1997
Hubert Williams, Director



<PAGE>


                          EXHIBIT INDEX

EXHIBIT NO.                DESCRIPTION                         PAGE NO. 

 3.1      Restated Certificate of Incorporation of the            **
          Registrant as amended through and including
          June 29, 1995 (filed as Exhibit 3 to the 
          Registrant's Form 10-Q for the quarter ended
          March 31, 1996 and incorporated by reference 
          herein).

 3.2      Bylaws of the Registrant, as amended to date            **
          (filed as Exhibit 3(d) to the Registrant's Form
          10-K Report for the fiscal year ended December 31,
          1989 and incorporated herein by reference).

 10.1     Lease between The Prudential Insurance Company          **
          of America and Broad National Bank dated as of
          December 15, 1988 (filed as Exhibit 3(e) to the 
          Registrant's Form 10-K Report for the fiscal year
          ended December 31, 1989 and incorporated herein by 
          reference).

 10.1.1   Amendment of Lease between The Prudential               **
          Insurance Company of America and Broad National
          Bank dated as of February 7, 1996 (filed as
          Exhibit 10.1.1 to the Registrant's Form 10-K 
          Report for the fiscal year ended December 31, 
          1995 and incorporated herein by reference).

 10.2     Lease between Third Newark Gateway Urban                 **
          Renewal Association and Broad National Bank, 
          dated September 7, 1984 (filed as Exhibit 10(b) 
          to Registration Statement No. 33-01560 and 
          incorporated herein by reference).

 10.3     Lease between O. Navigador Bar, Inc. and Broad          **
          National Bank (filed as Exhibit 10(c) to 
          Amendment No. 1 to Registration Statement No.
          2-78220 and incorporated herein by reference).

 10.4     Lease between Millburn Common Associates and             **
          Broad National Bank dated June 16, 1976, and
          Amendment to such Lease, dated September 10,
          1985 (filed as Exhibit 10(d) to Registration 
          Statement No. 33-01560 and incorporated herein 
          by reference).

 10.5     Lease between Cada Holding Corp. and Broad               **
          National Bank dated October 8, 1976 (filed as 
          Exhibit 10(e) to Amendment No. 1 to Registration
          Statement No. 2-78220 and incorporated herein by
          reference).


<PAGE>



 10.6     Lease between Euro Associates and Broad National        **
          Bank acknowledged by the parties on December 12,
          1985 and December 10, 1985 (filed with Amendment
          No. 2 to the Registrant's Registration Statement
          No. 33-53658 as Exhibit 10.6 and incorporated
          herein by reference).

 10.7     Workletter Agreement between Euro Associates and        **
          Broad National Bank (filed with Amendment No. 2
          to the Registrant's Registration Statement No.
          33-53658 as Exhibit 10.7 and incorporated herein 
          by reference).

 10.8     Lease between 1000 South Elmora Associates and          **
          Broad National Bank dated May 18, 1986 (filed with
          Amendment No. 2 to the Registrant's Registration
          Statement No. 33-53658 as Exhibit 10.8 and 
          incorporated herein by reference).

 10.9     Lease between Convery Associates and Broad               **
          National Bank dated July 1, 1987, and Rider to
          Lease Agreement, dated September 1, 1992 (filed
          with Amendment No. 2 to the Registrant's 
          Registration Statement No. 33-53658 as Exhibit 
          10.10 and incorporated herein by reference).

 10.10    Lease Agreement and Amendment between 466               **
          Bloomfield Avenue Associates, Inc. and Broad
          National Bank dated February 9, 1988 (filed as
          Exhibit 10(1) to the Registrant's Form 10-K
          Report for the fiscal year ended December 31,
          1989 and incorporated herein by reference).

 10.11    Lease Agreement between George Zeik and Broad            **
          National Bank dated September 1, 1989 (filed as
          Exhibit 10(m) to the Registrant's Form 10-K
          Report for the fiscal year ended December 31,
          1989 and incorporated herein by reference).

 10.12    Lease between Broad National Realty Corporation          **
          and Broad National Bank dated May 1, 1990 (filed
          as Exhibit 10(n) to the Registrant's Form 10-K 
          for the fiscal year ended December 31, 1990 and
          incorporated by reference herein).

 10.12.1  Rider to Lease Agreement between Broad National          **
          Realty and Broad National Bank dated December 21,
          1993 (filed as Exhibit 10.13.1 to the Registrant's
          Form 10-K for the fiscal year ended December 31,
          1993 and incorporated herein by reference).



<PAGE>


 10.13    Broad National Bank Employees' Retirement Plan          **
          (filed as Exhibit 10(g) to Registration Statement
          No. 2-78220 and as Exhibit 10(f) to Amendment No. 1
          to Registration Statement No. 2-78220 and 
          incorporated herein by reference ).*

 10.14    Form of Amendment to Sections 2.1 and 3.1(c)            **
          of the Broad National Bank Employees' Retirement
          Plan (filed as Exhibit 10(p) to the Registrant's
          Form 10-K for the fiscal year ended December 31,
          1990 and incorporated by reference herein).*

 10.15    Description of Bonus Plan for Designated Officers        **
          and Employees (appears on page 10 of the 
          Registrant's definitive proxy statement for its 
          1991 Annual Meeting of Shareholders and is
          incorporated herein by reference).*

 10.16    Incentive Stock Option Plan for certain employees        **
          adopted on March 26, 1987, and amended April 27, 
          1989 (filed as Exhibit 10.18 to the Registrant's
          Form 10-K for the fiscal year ended December 31,
          1992 and incorporated by reference herein).*

 10.17    Non-Statutory Stock Option Plan for directors           **
          adopted on March 26, 1987 (filed with Amendment
          No. 2 to the Registrant's Registration Statement
          No. 33-53658 as Exhibit 10.19 and incorporated
          herein by reference).*

 10.18    Employment Agreement between Donald M. Karp and          --
          the Registrant dated December 31, 1996.*

 10.19    Employment Agreement by and between John A.              --
          Dorman, Broad National Bank and the Registrant,
          dated December 31, 1996.*

 10.20    Consultant Agreement between Stanley J. Lesnik          **
          and the Registrant dated November 16, 1995 (filed
          as Exhibit 10.20 to the Registrant's Form 10-K
          for the fiscal year ended December 31, 1995 and
          incorporated herein by reference).*

 10.21    Lease between Broad National Bank, landlord,             **
          and Newtrend, L.P., tenant, dated August 10,
          1993 (filed as Exhibit 10.22 to the Registrant's
          Form 10-K for the fiscal year ended December 31,
          1993 and incorporated herein by reference).

 10.22    Newtrend Service Bureau Agreement between               **
          Newtrend, Inc. and Broad National Bank dated
          August 10, 1993 (filed as Exhibit 10.23 to the


<PAGE>


          Registrant's Form 10-K for the fiscal year
          ended December 31, 1993 and incorporated herein
          by reference).

 10.23    Newtrend Item Processing Addendum between               **
          Newtrend, Inc. and Broad National Bank dated
          August 10, 1993 (filed as Exhibit 10.24 to the
          Registrant's Form 10-K for the fiscal year ended
          December 31, 1993 and incorporated herein by
          reference).

 10.24    1993 Broad National Incentive Stock Option Plan         **
          for certain employees adopted on September 19, 
          1994 (filed as Exhibit 10.24 to the Registrant's
          Form 10-K Report for the fiscal year ended
          December 31, 1994 and incorporated herein by
          reference).*

 10.25    1993 Broad National Directors Non-Statutory Stock        **
          Option Plan for directors adopted on September 19,
          1994 (filed as Exhibit 10.25 to the Registrant's
          Form 10-K Report for the fiscal year ended
          December 31, 1994 and incorporated herein by 
          reference).*

 10.26    Lease between Lucky Realty LLC and Broad National        **
          Bank (filed as Exhibit 10.26 to the Registrant's
          Form 10-K Report for the fiscal year ended
          December 31, 1995 and incorporated herein by
          reference).

 10.27    Lease between A.J. Seabra Supermarkets V, Inc.           **
          and Broad National Bank dated as of April 20, 
          1995 (filed as Exhibit 10.27 to the Registrant's
          Form 10-K Report for the fiscal year ended
          December 31, 1995 and incorporated herein by
          reference).

 10.28    1996 Broad National Bancorporation Incentive            --
          Stock Option Plan for certain employees adopted
          on December 19, 1996 and subsequently amended
          on January 16, 1997.*

 10.29    1996 Broad National Bancorporation Directors            --
          Non-Statutory Stock Option Plan for directors
          adopted on December 19, 1996.*

 10.30    Broad National Bank Long-Term Capital                   --
          Accumulation Plan for certain employees adopted
          on October 19, 1995.*


<PAGE>


 10.31    Broad National Bank Deferred Compensation Plan          --
          for certain employees and directors adopted on
          October 19, 1995.*

 10.32    Broad National Bank Management Incentive Plan            --
          for certain employees adopted on October 19,
          1995.*

 11       Statement re Computation of Net Income Per Share.        --

 22       List of Subsidiaries (filed with Amendment No. 3        **
          to the Registrant's Registration Statement No.
          33-53658 as Exhibit 22 and incorporated herein
          by reference).

 24       Consent of KPMG Peat Marwick LLP with regard to          --
          Bancorporation's Registration Statement on Form
          S-8 (Reg. No. 33-28183).

 27       Financial Data Schedule.                                --

__________________________

*         Management contracts or compensatory plans or
          arrangements required to be identified by Item
          14(a)(3).

**        Incorporated by reference from previous filings.