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

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

                                    FORM 10-Q

(Mark One)

X    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

     For the period ended March 31, 1998

     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 0-23134

                    PEOPLES BANK CORPORATION OF INDIANAPOLIS
             (Exact name of registrant as specified in its charter)


           Indiana                                           35-1681096
--------------------------------------------------------------------------------
(State of other jurisdiction                             (I.R.S. Employer 
of incorporation or organization)                       identification no.)


130 East Market Street          Indianapolis, Indiana          46204
--------------------------------------------------------------------------------
(Address of principal                                        (Zip Code)
executive offices)

                                 (317) 237-8121
              (Registrant's telephone number, including area code)

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

         Indicate  the  number of  shares  outstanding  of each of the  issuer's
classes of common stock, as of the latest practical date.

         Common Shares, without par value
                  Nonvoting -       2,812,834 shares as of May 12, 1998
                  Voting    -         264,096 shares as of May 12, 1998




<PAGE>
                    PEOPLES BANK CORPORATION OF INDIANAPOLIS

                                      INDEX



PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements

         Consolidated Balance Sheets at March 31, 1998
         and December 31, 1997.................................................2

         Consolidated Statements of Income for the three months ended
         March 31, 1998 and 1997 ..............................................3

         Consolidated Statements of Comprehensive Income for the
         three months ended March 31, 1998 and 1997............................4

         Consolidated Statements of Changes in Shareholders'
         Equity................................................................5

         Consolidated Statements of Cash Flows for the three months ended
         March 31, 1998 and 1997 ..............................................6

         Notes to Consolidated Financial Statements ...........................7

Item 2.  Management's Discussion and Analysis of Results of Operations
          and Financial Condition...........................................8-16

PART II.  OTHER INFORMATION

Item 4. Submission of Matters to a Vote of Security Holders...................17

Item 6. Exhibits and Reports on Form 8-K .....................................17

Signatures....................................................................18

<PAGE>

PEOPLES BANK CORPORATION OF INDIANAPOLIS
CONSOLIDATED BALANCE SHEETS
================================================================================
(Dollar amounts in thousands)
                                                  March 31,      December 31,
                                                    1998             1997
                                                  ---------       ---------
Assets

      Cash and due from  banks                    $  20,550       $  25,462
      Federal funds sold                                  0               0
                                                  ---------       ---------
        Total cash and equivalents                   20,550          25,462

      Available-for-sale securities                 154,336         153,870


      Loans held for sale                             2,099             561
      Total loans                                   418,445         406,893
        Allowance for loan losses                    (6,333)         (5,516)
                                                  ---------       ---------
Loans, net                                          412,112         401,377

      Premises and equipment, net                     7,527           7,482
      Accrued income and other assets                12,292           9,724
                                                  ---------       ---------
Total assets                                        608,916         598,476
                                                  =========       =========

Liabilities

      Non interest-bearing deposits               $  86,733       $  82,132
      Interest-bearing deposits                     444,151         426,179
                                                  ---------       ---------

Total deposits                                      530,884         508,311

      Short-term borrowings                          21,730          34,380
      Accrued expenses and other liabilities          7,804           6,968
                                                  ---------       ---------
Total liabilities                                   560,418         549,659


Shareholders' equity
      Common shares, no par value:
      Authorized:
        Voting - 300,000shares
        Nonvoting - 4,000,000shares

      Issued:
        Voting - 264,096 shares                         896             897
        Nonvoting  - 2,812,834shares(1998)
                   - 2,812,634shares(1997)           13,086          13,085
      Retained earnings                              33,888          34,220
      Net unrealized gain/(loss) on
        available-for-sale securities                   628             615
                                                  ---------       ---------
        Total shareholders' equity                   48,498          48,817
                                                  ---------       ---------
        Total liabilities and
           shareholders' equity                   $ 608,916       $ 598,476
                                                  =========       =========

See accompanying notes.



<PAGE>

PEOPLES BANK CORPORATION OF INDIANAPOLIS
CONSOLIDATED STATEMENTS OF INCOME
================================================================================
(Dollar amounts in thousands, except per share data)

                                               Three months ended
                                                    March  31,
                                               1998           1997
                                             --------       --------
Interest income
      Interest and fees on loans             $  9,008       $  7,176
      Interest on federal funds sold              105            220
      Interest on investments                   2,388          1,336
                                             --------       --------
        Total interest income                  11,501          8,732

Interest expense
      Interest on deposits                      5,225          3,632
      Interest on short-term borrowings           162            120
                                             --------       --------
        Total interest expense                  5,387          3,752
                                             --------       --------
Net interest income                             6,114          4,980

Provision for loan losses                       3,000            400
                                             --------       --------
Net interest income after
      provision for loan losses                 3,114          4,580

Other operating income
      Trust fees                                  480            371
      Service charge income                       658            705
      Mortgage banking revenue                    179            127
      Net gain (loss) on
        investments                                 6             (1)
      Other operating income                      237            201
                                             --------       --------
        Total other operating income            1,560          1,403

Other operating expenses
      Salaries and employee benefits            2,617          2,173
      Occupancy expense (net)                     372            434
      Equipment expense                           312            263
      Advertising Expense                         112            124
      Other operating expense                   1,274            859
                                             --------       --------
        Total other operating expenses          4,687          3,853

Income before income taxes                        (13)         2,130

Income Taxes                                      (68)           677

Net income                                   $     55       $  1,453
                                             ========       ========
Net income per share (Note 3)
                                             ========       ========
  Basic                                      $   0.02       $   0.46
                                             ========       ========
  Diluted                                    $   0.02       $   0.46
                                             ========       ========

See accompanying notes.



<PAGE>

PEOPLES BANK CORPORATION OF INDIANAPOLIS
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
================================================================================
(Dollar amounts)

                                                           Three months ended
                                                               March  31,
                                                           1998         1997
                                                         -------      -------
Net income                                               $    55      $ 1,453
  Other comprehensive income, net of tax:
    Change in unrealized gains/losses on securities           13         (229)
                                                         =======      =======
Comprehensive income                                     $    68      $ 1,224
                                                         =======      =======




<PAGE>

PEOPLES BANK CORPORATION OF INDIANAPOLIS
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
================================================================================
(Dollar amounts in thousands)


                                                    1998           1997
                                                  --------       --------

Balance at January 1                              $ 48,817       $ 45,349

      Net Income                                        55          1,453

      Cash dividends                                  (385)          (329)

      Proceeds from exercise of stock option             3              0

      Repurchase of common stock                        (5)           (85)

      Change in unrealized gains (losses)
      on securities:                                    13           (229)

                                                  --------       --------
Balance at March 31                               $ 48,498       $ 46,159
                                                  ========       ========




<PAGE>

PEOPLES BANK CORPORATION OF INDIANAPOLIS
CONSOLIDATED STATEMENTS OF CASH FLOWS
================================================================================
(Dollar amounts in thousands)

<TABLE>
<CAPTION>
                                                                        Three months ended
                                                                             March 31,
                                                                        1998           1997
                                                                      --------       --------
Cash flows from operating activities
<S>                                                                   <C>            <C>     
       Net Income                                                     $     55       $  1,453
       Adjustments to reconcile net income to net cash
         from operating activities
       Depreciation and amortization                                       300            298
       Provision for loan losses                                         3,000            400
       Net (gain)/loss on investment securities                             (6)             1
       Net amortization/(accretion) on investments                          20             43
       Net gain on the sale of loans                                      (128)           (66)
       Change in interest payable and other liabilities                    836              0
       Change in interest receivable and other assets                   (3,357)          (140)
       Loans originated for sale, net of sales proceeds                 (1,410)           148
                                                                      --------       --------

               Net cash from operating activities                         (690)         2,137
                                                                      --------       --------


Cash flows from investing activities
       Proceeds from sales of available-for-sale securities                  0              0
       Proceeds from maturities of available-for-sale securities        13,038         11,072
       Purchase of available-for-sale securities                       (12,692)        (8,082)
       Loans made to customers, net of principal
         collection thereon                                            (13,735)       (11,550)
       Property and equipment expenditures                                (369)            60
                                                                      --------       --------

         Net cash from investing activities                            (13,758)        (8,500)
                                                                      --------       --------

Cash flows from financing activities
       Net change in deposits                                           22,573         15,055
       Net change in short-term borrowings                             (12,650)         1,037
       Proceeds from exercise of stock option                                3              0
       Dividends paid                                                     (385)          (329)
       Purchase of common stock                                             (5)           (85)
                                                                      --------       --------

         Net cash from financing activities                              9,536         15,678
                                                                      --------       --------

Net change in cash and cash equivalents                                 (4,912)         9,315

Cash and cash equivalents at beginning of year                          25,462         32,252
                                                                      --------       --------

Cash and cash equivalents at March 31                                 $ 20,550       $ 41,567
                                                                      ========       ========

</TABLE>

<PAGE>

                    Peoples Bank Corporation of Indianapolis

                   Notes to Consolidated Financial Statements

                                 March 31, 1998

1.  Accounting Policies

         Except as noted in Note 3, the significant accounting policies followed
by Peoples Bank  Corporation of  Indianapolis  ("The  Corporation")  for interim
financial  reporting are consistent  with the accounting  policies  followed for
annual financial  reporting.  The consolidated interim financial statements have
been prepared in accordance  with  instructions to Form 10-Q and may not include
all  information  and  footnotes   normally  shown  for  full  annual  financial
statements.  All adjustments which are, in the opinion of management,  necessary
for a fair  presentation  of the  results  for the  periods  reported  have been
included in the accompanying unaudited consolidated financial statements and all
such adjustments are of a normal recurring nature.

2.  Earnings Per Share

The following table presents share data used to compute earnings per share:


                                                              At March 31,
                                                          1998           1997
                                                       ---------      ---------
Weighted average shares outstanding                    3,076,867      3,143,674
Dilutive effect of potential shares                       84,444         32,619
                                                       ---------      ---------
Shares used to compute diluted earnings per share      3,161,311      3,176,293

3.  Accounting Changes

         Financial  Accounting  Standard No. 125,  Accounting  for Transfers and
Servicing of Financial Assets and  Extinguishment of Liabilities,  was issued by
the Financial  Accounting Standards Board in 1997. It revises the accounting for
transfers  of  financial  assets,   such  as  loans  and  securities,   and  for
distinguishing  between sales and secured  borrowings.  It is effective for some
transactions in 1997 and others in 1998.  Management does not expect adoption of
this Standard to have a significant  effect on the Company's  financial position
or results of operations.

         Financial Accounting Standard No. 130, Reporting  Comprehensive Income,
is effective for both interim and year-end financial statements for fiscal years
beginning after December 15, 1997, and  establishes  standards for reporting and
display of comprehensive income and its components  (revenues,  expenses,  gains
and losses) in a full set of general-purpose financial statements. Comprehensive
income is defined  as all  changes in equity  other  than those  resulting  from
investments by owners or  distributions  to owners.  Net income,  therefore is a
component of comprehensive income.  Implementation of this Standard will require
additional disclosures in future financial reports but will not otherwise affect
the Company.











<PAGE>




PART I. FINANCIAL INFORMATION

Item 2.  Management's Discussion and Analysis
 (Dollar amounts in thousands, except per share data)

General

The  business  of Peoples  Bank  Corporation  of  Indianapolis  ("The  Company")
consists  of holding and  administering  its  interest  in Peoples  Bank & Trust
Company  ("Peoples").  The principal  business of Peoples consists of attracting
deposits from consumer and commercial  customers and making loans to individuals
and  businesses.  Peoples  offers  various  products  for  depositors  including
checking and savings  accounts,  certificates of deposit and safe deposit boxes.
Loans consist  principally of loans to individuals  secured by mortgage liens on
residential  properties,  consumer loans generally  secured by personal property
and loans to businesses  generally secured by liens on business assets.  Peoples
also offers trust services to individuals, businesses and institutions.

The Company  operates 11 branch  locations,  a twelve  story  office in downtown
Indianapolis,  and an  operations  center.  Peoples  occupies five floors of the
downtown office building and leases six floors to tenants.  The top floor houses
the board room and a training area.  Leased tenant space at the downtown  office
remains at near capacity.

The Board of Directors of the Company approved on July 18, 1996, the repurchase,
from time to time, of 200,000  nonvoting  common shares on the open market.  The
Board  believed that the shares had been at times  undervalued in the market and
that it was in the best interest of the  shareholders  and the Company to effect
such share  repurchases.  At March 31, 1998, a total of 103,254  shares had been
repurchased at an average price of $22.34.

The book value per share of Peoples  nonvoting  common shares at March 31, 1998,
was $15.76. For the first quarter,  the low trading price per share was $ 35.25,
and the high trading price per share was $40.75.

On March  19,1998,  Peoples  declared a cash dividend in the amount of $.125 per
share,  payable April 17, 1998, to  shareholders  of record March 31, 1998. This
dividend  represents a 4.16%  increase over the fourth quarter 1997 dividend and
is the seventh  consecutive quarter in which Peoples has declared an increase in
dividends.










Selected ratios and summary data.
                                           At or for the Three Months Ended
                                                      March 31,
                                              1998                 1997
                                          --------------       --------------

Assets                                    $  608,916           $  488,380
Loans (includes loans held for sale)         420,544              345,055
Deposits                                     530,884              426,860
Shareholders Equity                           48,498               46,159
Book value per share                           15.76                14.69
                                                              
Earnings per share (basic)                $     0.02           $     0.46
Earnings per share (diluted)              $     0.02           $     0.46
Dividends per share                       $    0.125           $    0.105
Net Interest Margin (FTE)                       4.44%                4.70%
Return on Average Assets                        0.04%                1.31%
Return on Average Equity                        0.46%               13.36%
                                                              
Average Shares Outstanding                                    
--Basic                                    3,076,867            3,143,674
--Diluted                                  3,161,311            3,176,293
                                                              
Total Shares Outstanding                   3,076,930            3,141,924
                                                          
Net Income

Net income  for the first  quarter  of 1998 was $55  compared  to $1,453 for the
first  quarter  of 1997,  a decrease  of 96.21% or $1,398.  Basic net income per
share for the first  quarter 1998  decreased  $0.44 or 95.65% from $0.46 for the
first quarter of 1997. The decrease in net income is attributable to an increase
in the  provision  for loan  losses to $3,000  for the first  quarter of 1998 as
compared to $400 for the first  quarter of 1997.  The  decision to  dramatically
increase  provision  expense is more fully discussed  below. In other areas, the
Company had strong  performance.  Net interest  income was up 22.77%  during the
first  quarter  of 1998 as  compared  with the  first  quarter  of  1998.  Other
operating  income  was up 11.19%  during  the  first  quarter.  Other  operating
expenses  were  up $834 or  21.65%.  However,  $280  of the  increase  in  other
operating  expenses was  associated  with the  write-down  of an investment in a
troubled  low-income  housing  project  undertaken  by the bank to generate  tax
credits.  Absent  the  increase  associated  with  the  housing  project,  other
operating  expenses  would have been up 14.4%,  primarily on increases in salary
and benefit expense.


<PAGE>

Net Interest Income

Net interest income is the principal component of net income for the Company and
represents the difference  between  interest earned on loans and investments and
the interest  cost of deposits and other  borrowed  funds.  For the three months
ended  March 31,  net  interest  income was $6,114 and $4,980 for 1998 and 1997,
respectively. This reflects an increase of $1,134 or 22.77%.

Interest  income for the three  months ended March 31 was $11,501 and $8,732 for
1998 and 1997, respectively. This increase in interest income is attributable to
loan  growth of 21.88%  and  growth in  investment  balances  of  69.27%.  Total
interest  expense  was $5,387 and $3,752 for the three  months  ended  March 31,
1998, and 1997, respectively.

Interest and fees on loans  increased  from $7,176 for the first three months of
1997 to $9,008 for that period in 1998,  an increase of $1,832 or 25.53%.  These
increases are attributable to an increase in loans outstanding. Total loans were
$420,544 at March 31, 1998,  compared to $345,055 at March 31, 1997, an increase
of $75,489 or 21.88%.

The Company's net interest margin, or margin on earning assets,  decreased 0.19%
to 4.33% for the first  three  months  of 1998  from  4.52% for the first  three
months of 1997. On a tax equivalent basis, the Company's net interest margin was
4.44% and 4.70%, respectively,  for those periods, a decrease of 0.26%. The most
significant  reason for the decrease in the net interest  margin in 1998 was the
increase in security  balances.  While this strategy reduced interest rate risk,
enhanced net interest income,  and resulted in significant  unrealized gains, it
also  reduced  the net  interest  margin.  Had  the  Company  not  significantly
increased investment security balances,  the net interest margin would have been
up  slightly.  The  stability  of the net  interest  margin  (absent  investment
securities  purchases)  occurred  at the same  time that the  balance  sheet was
growing  significantly,  demonstrating  that  balance  sheet growth was achieved
without sacrificing pricing.

Provision & Allowance for Loan Losses

The  provision  for loan losses was $3,000 for the first three months of 1998 as
compared  to $400 for the first three  months of 1997,  an increase of $2,600 or
650.00%. The allowance for loan losses at March 31, 1998, was $6,333 or 1.51% of
total loans  compared to $5,516 or 1.36 % of total loans at December  31,  1997.
Gross  charge-offs  during  the  first  three  months of 1998  were  $2,262  and
recoveries were $79.

Charge-offs  during the first quarter of 1998 included a $2,000  charge-off on a
single  commercial  loan.  That loan had been  placed on  non-accrual  status at
December  31,  1997,  based on weakening  financial  condition  indicated by the
customer's interim financial  statements.  Audited financial statements provided
to management near the end of the first quarter showed  substantial  deteriation
in the customer's condition,  and demonstrated that interim financial statements
provided during 1997 were grossly erroneous. Management concluded that there was
little chance of recovery for the customer and that  collateral  was unlikely to
prevent considerable loss to the Company.  Therefore,  management  determined to
charge-off all portions of the loan believed to be uncollectible. Charge-offs do
not impact net income,  since they are charged  against the  allowance  for loan
losses.  However,  the  increase in the  provision  for loan losses in the first
quarter of 1998 was considered necessary by management to maintain the allowance
at desirable levels. The adequacy of the allowance for loan loss is evaluated at
least quarterly by a credit review officer and management  based upon the review
of identified loans with more than a normal degree of risk, historical loan loss
percentages,  and present and  forecast  economic  conditions.  During the first
quarter,  several  additional  commercial  loan  relationships  were  placed  on
non-accrual  status,  resulting  in  an  increase  in  non-performing  loans  as
discussed below. Further, management believes that the allowance for loan losses
should be  maintained  at a strong  level  given the  economy's  mature  status.
Therefore,  management  elected to increase  the loan loss  provision  to $3,000
during the first quarter of 1998, and anticipates  maintaining the allowance for
loan  losses  at   approximately   1.50%  or  more  so  long  as  the  level  of
non-performing  loans  remains  at  its  current  level.  Management's  analysis
indicated  that the allowance for loan losses at March 31, 1998, was adequate to
cover  potential  losses on identified  loans with credit problems and potential
losses on the remaining loan portfolio based on historical percentages.


Other Operating Income

Non-interest  income totaled $1,560 for the first three months of 1998, compared
to $1,403 for that period of 1997,  an  increase  of $157 or 11.19%.  Trust fees
were $480 and $371 for the first three months of 1998 and 1997, respectively, an
increase of $109 or 29.38%.

Service  charges on deposit  accounts,  which comprise the largest  component of
non-interest  income, were down for the first three months of 1998 compared with
the same periods of 1997. For the three month periods ending March 31, 1998, and
1997, service charge income was $658 and $705 respectively, a decrease of $47 or
6.67%. The decrease in service charge income can be traced to a decrease in fees
for nonsufficient  funds (NSF). NSF fees were $224 and $268 respectively for the
three months ending March 31, 1998, and 1997, respectively, a decrease of $44 or
16.42%

Mortgage  banking  revenue  includes net gains and losses realized when mortgage
loans are sold into the  secondary  market and service  fee revenue  earned from
servicing  those loans  after they are sold.  Mortgage  banking  revenue for the
first three  months of 1998 was $179,  reflecting  an increase of $52 or 40.94%,
compared to $127 for the same period in 1997.  The increase in mortgage  banking
revenue can be associated  with  stronger  activity in the first quarter of 1998
due to an increase in refinancing  activities  associated  with lower  long-term
interest  rates.  During the first quarter of 1998,  the bank  originated  $8.84
million in loans sold into the secondary market and $12.44 million in adjustable
rate mortgages  retained by the bank compared to $2.36 million in loans sold and
$9.35 million in adjustable rate mortgages retained in the first quarter of 1997
 . During 1997,  the bank reduced  staff in this area by more than fifty  percent
and focused its  origination  efforts on adjustable  rate  mortgage  loans which
would not be sold into the secondary market

Other operating  income  increased during the first three months of 1998 to $237
from $201 for the same period in 1997, an increase of $36 or 17.91%.

Other Operating Expenses

Total other operating  expenses were $4,687 for the three months ended March 31,
1998,  compared with $3,853 for that period in 1997. This represents an increase
of $834, or 21.65%. Salary and employee benefit expense was $2,617 for the first
three  months of 1998,  an  increase of $444 or 20.43% from $2,173 for the first
three months of 1997.  This  increase was primarily  associated  with salary and
wage rate  increases,  increases  in  staff,  and an  expense  of $177 for stock
appreciation rights granted to the Company's Chief Operating Officer.

Occupancy  expense  was $372 for the first three  months of 1998,  a decrease of
$62, or 14.29% from $434 for the first three months of 1997.  Equipment expenses
were $312 and $263,  respectively,  for the first three months of 1998 and 1997,
an increase of $49 or 18.63%.  The  reduction in occupancy  expense is primarily
associated with  reductions in operating and  maintenance  expenses in the first
quarter of 1998.  The increase in equipment  expense is primarily  the result of
investments in new technology including a bank-wide network, platform automation
for the branch system, and new office equipment.

Advertising  expenses were $112 and $124, for the first three months of 1998 and
1997,  respectively,  a decrease of $12 or 9.68%.  Other operating expenses were
$1,274 and $859 for the first three  months of 1998 and 1997,  respectively,  an
increase  of  $415 or  48.31%.  The  principal  reason  for  this  increase  was
management's  decision  to  recognize  a loss of $280  on a  low-income  housing
investment.  Early in 1997, Peoples purchased a 99% limited partnership interest
in  a  low-income  housing  project  located  in  Indianapolis  for  $648.  This
investment  was  intended  to  provide  tax  credits  in  addition  to cash flow
sheltered  by  depreciation,  and  was  expected  to  help  the  bank  meet  its
obligations  with  respect to the  Community  Reinvestment  Act. The project has
failed to meet expectations during its first year, with net losses substantially
in excess of the project's initial  projections.  Audited  financial  statements
indicate that the value of the bank's limited partnership interest, as accounted
for using generally accepted accounting principles,  declined by $259 during its
first year on net loss of $261. The write-down taken during the first quarter of
1998 brought the investment's book value in line with its value as stated on the
books of the  partnership.  Peoples  anticipates  taking a charge to earnings of
approximately  $25 per month until the book value of the asset is  depleted.  So
long as the project remains  solvent,  Peoples will continue to benefit from the
tax credits in forthcoming years as originally  projected.  However, the project
provided  no tax  credits  during  1997,  so there are no  potential  tax credit
recapture issues to date.


Income Taxes

Income  taxes  were  ($68) for the first  three  months of 1998 and $677 for the
first three months of 1997. The decrease in taxes can be primarily attributed to
decreased income recognized during the quarter.


Balance sheet

Total assets were $608,916 at March 31, 1998, and $598,476 at December 31, 1997,
an increase of $10,440. The portfolio of available-for-sale securities increased
from  $153,870 at December 31, 1997,  to $154,336 at March 31, 1998, an increase
of $466 or 0.30%. Total loans,  excluding loans held for sale,  increased during
the first three months of 1998 from  $406,893 at December 31, 1997,  to $418,445
at March 31,  1998.  This  reflects an increase of $11,552 or 2.84%.  Commercial
loans increased  $3,442 or 1.86% from $185,089 at December 31, 1997, to $188,531
at March 31, 1998. Real estate loans,  which consist of  construction  loans and
permanent residential and commercial mortgages,  increased $10,030 or 8.38% from
$119,640 at December 31, 1997,  to $129,670 at March 31,  1998.  Consumer  loans
increased $194 or 0.19% from $100,139 at December 31, 1997, to $100,333 at March
31, 1998.  Loans held for sale consist of conforming  fixed rate mortgage  loans
that Peoples sells in the secondary  market (having  retained  servicing  rights
with  respect to such loans) and that are pending  funding.  Loans held for sale
were $561 at December 31, 1997, compared to $2,099 at March 31, 1998. The amount
of loans  outstanding  (excluding  loans  held for  sale) are  reflected  in the
following table.


<PAGE>




                                      March 31,    December 31,   March 31,
                                        1998          1997          1997
                                      --------      --------      --------

Real Estate                           $129,670      $119,640      $104,676
Commercial                             188,531       185,089       151,231
Consumer                               100,333       100,139        81,038
Tax exempt                               2,010         2,025         2,110
Loans to Depository Institutions             0             0         6,000
                                      --------      --------      --------
Total Loans                            420,544       406,893       345,055
Less:  Allowance for Loan Losses         6,333         5,516         4,514
                                      --------      --------      --------
Net Loans                             $414,211      $401,377      $340,541
                                      ========      ========      ========

Deposits  represent the primary source of funds for the Company.  Total deposits
increased $22,573 or 4.44%,  from $508,311 at December  31,1997,  to $530,884 at
March 31, 1998.  Non-interest-bearing  deposits increased $4,601, or 5.60%, from
$82,132 at  December  31,  1997,  to $86,733 at March 31,  1998.  The  Company's
deposit balances are reflected in the following table.

                                       March 31,    December 31,    March 31,
                                        1998           1997           1997
Deposits:

         Non-interest-bearing         $ 86,733       $ 82,132       $ 75,560

            Interest-bearing           444,151        426,179        351,300
                                      --------       --------       --------

                  Total deposits      $530,884       $508,311       $426,860
                                      ========       ========       ========

Total deposits/total assets              87.19%         84.93%         87.40%


Short-term  borrowings in the form of Federal funds, Federal Home Loan advances,
and  repurchase  agreements  are  acquired,  as  needed,  to  satisfy  temporary
liquidity  needs.  Short-term  borrowings  were  $21,730 at March 31,  1998,  as
compared to $34,380 at December 31, 1997.  This represents a decrease of $12,650
or 36.79%.  At March 31,  1998,  Peoples had  $13,730 in  overnight  repurchase
agreements,  $2,000 in federal funds purchased,  and $6,000 in Federal Home Loan
Bank advances.  Overnight repurchase agreements continue to be a source of funds
for Peoples. Many of the funds are from businesses with large cash balances.

Total  shareholders'  equity  decreased $319 or 0.65% for the three months ended
March 31, 1998, to $48,498,  from $48,817 at December 31, 1997.  The decrease in
shareholders'  equity  was  primarily  the  result of net  income  of $55,  less
dividends  paid of $385.  The adoption of FAS No. 115 resulted in a $13 increase
in equity.


Credit Quality

Nonaccrual  loans are loans on which the  Company  no longer  accrues  interest.
Management  places a loan on nonaccrual status when the collection of additional
interest is unlikely  and the loan is not  considered  to be well secured and in
the  process of  collection.  Nonperforming  loans  consist of loans that are on
nonaccrual  status,  that  are 90 days  or  more  past  due as to  principal  or
interest,  or that are restructured.  If a loan is designated as a nonperforming
loan, management,  as a result of delinquent status or significant concern about
the ultimate  collectibility of the loan, typically ceases to recognize interest
income with respect to such loan and places it on nonaccrual status.

At March 31, 1998,  Management  designated $3,289 in loans as "impaired" for the
purpose of FAS No. 114.  Management has further  determined  that all commercial
non-accrual loans will be considered as impaired.

The following table shows the composition of nonperforming loans.


                                          March 31,  December 31,  March 31,
                                            1998        1997         1997

Nonperforming loans:

         Total nonaccrual loans            $2,496      $3,626      $  220
         Loans past due more than             346          16         407
           90 days and still accruing          --          --          --
                                           ------      ------      ------
         Total                             $2,842      $3,642      $  627
                                           ======      ======      ======

At March 31, 1998,  nonperforming  loans were  comprised of $2,074 of commercial
loans, $766 of real estate loans and $2 of consumer loans.  Nonperforming  loans
were comprised of $2,694 of commercial  loans,  $944 of real estate loans and $4
of consumer loans at December 31, 1997. At March 31, 1997,  nonperforming  loans
consisted  of $478 of  commercial  loans,  $148 of real  estate  loans and $1 of
consumer loans. Asset quality continues to be an important area of focus for the
Company.  Nonperforming  loans as a percent  of assets  were  0.47% at March 31,
1998,  and 0.61% at December  31,  1997.  The Company  maintains  asset  quality
through the use of  well-defined  policies,  underwriting  criteria,  and review
processes.  It should be noted that despite the  charge-off of $2,262 during the
first quarter,  non-accrual  loans  decreased by only $1,130 because  additional
loans were placed on non-accrual status during the first quarter of 1998.

Capital

The  Company  and Peoples  are  required  to comply  with  capital  requirements
promulgated  by their  primary  regulators  that  affect  their  ability  to pay
dividends and that can affect their operations.  Those  regulations  require the
maintenance of specified  levels of capital to total assets (leverage ratio) and
to risk weighted  assets (the  risk-based  capital  ratios).  These  regulations
require  the  maintenance  of a  leverage  ratio of at least  3.00%  and a total
risk-based  capital ratio of at least 8.00%. A financial  institution's  deposit
insurance assessment and, in certain circumstances,  operations will be affected
by its capital  level.  Institutions  with leverage  ratios of 5.00% or more and
total  risk-based  capital  ratios  of  10.00%  or more are  deemed  to be "well
capitalized," and accordingly,  pay the lowest deposit insurance  assessment and
are not subject to operational restrictions as outlined within the regulation.

As of March 31, 1998, the Company's Tier I and total  risk-based  capital ratios
were 10.92% and 12.18%, respectively.  The Company's leverage ratio was 7.91% at
March 31,  1998.  As of March 31,  1998,  Peoples  was in excess of the  minimum
capital  and  leverage   requirements   necessary  to  be   considered  a  "well
capitalized"  banking company as defined by Federal regulators.  The Company and
Peoples were in full  compliance  with all regulatory  capital  requirements  at
March 31,  1998.  The  following  table  provides  the  capital  ratios  for the
entities.

                                       At March 31, 1998
                                                  Consolidated
                                     Bank Only      Company

Total assets                         $603,751       $608,916

Risked-based assets                   433,719        437,870

Tier I capital                         42,121         47,837

Total risk-based capital               47,554         53,321

Leverage ratio                           7.04%          7.91%

Tier I risk-based capital ratio          9.71%         10.92%

Total risk-based capital                10.96%         12.18%

PART II.  OTHER INFORMATION

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

The  Company's  Annual  Meeting of  Stockholders  was held April 16,  1998.  The
following  members  were  elected to the  Company's  Board of  Directors to hold
office for a period of one year or until  their  successors  are duly chosen and
qualified.  Shareholders  represented  in person  or by proxy and  voting at the
meeting  comprised 80% percent of the outstanding  voting shares. 

                                          Against or                 Broker
         Nominee              For          Withheld    Abstain      Non-votes
---------------------      -------        ----------   -------      ---------
William. E. McWhirter      210,625            0          560            0
Gerald R. Francis          210,625            0          560            0
Charles R. Farber          210,625            0          560            0
Robert B. Hirschman        210,625            0          560            0
Ethan Jackson              210,625            0          560            0
David W. Knall             210,625            0          560            0
Mary Ellen Rodgers         210,625            0          560            0
Stephen R. West            210,625            0          560            0
Darell E. Zink, Jr         210,625            0          560            0

The voting  shareholders  also  ratified the 1998 Stock Option Plan with 183,065
shares  voting in favor of the plan,  26,440 shares  voting  against,  and 1,680
shares abstaining.

Item 6. EXHIBITS AND REPORTS ON FORM 8-K

         A.  Exhibits -

                  27       Financial Data Schedule

         B.   Form 8-K - No reports on Form 8-K were filed during the quarter
                  ended March 31, 1998.


<PAGE>



                                   SIGNATURES


         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
the  registrant  has duly  caused  this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                   PEOPLES BANK CORPORATION OF INDIANAPOLIS
                       
                                 By: /s/ William. E. McWhirter
                                     ----------------------------------------
                                     William E. McWhirter
                                         Chairman and Chief Executive Officer
                       
                                 By: /s/ Charles R. Hageboeck
                                     ----------------------------------------
                                     Charles R. Hageboeck
                                     Senior Vice President and Chief
                                         Financial Officer


                       
                                                            DATE:  May 14, 1998