SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C.  20549
                                    FORM 10-Q

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

                  For the quarterly period ended March 31, 1999

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
    EXCHANGE ACT OF 1934

                         Commission file number 0-10958


                         DROVERS BANCSHARES CORPORATION
             (Exact name of registrant as specified in its charter)

                      PENNSYLVANIA                                23-2209390
(State or other jurisdiction of incorporation or organization)(IRS employer ID)

            30 SOUTH GEORGE STREET, YORK, PA                         17401
        (Address of principal executive office)                    (Zip Code)

       Registrant's telephone number, including area code  (717) 843-1586



                                      NONE
      (Former name, address and fiscal year, if changed since last report.)


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 shorter periods 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 the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.



               Class                      Outstanding at March 31, 1999
           Common Stock                            4,695,606 Shares




















1 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
CONTENTS
PART I  FINANCIAL INFORMATION

 ITEM 1.  FINANCIAL STATEMENTS

  Consolidated Statements of Condition ...................................  3
   March 31, 1999 and December 31, 1998

  Consolidated Statements of Income ......................................  4
   Three Months Ended March 31, 1999 and 1998

  Consolidated Statements of Comprehensive Income ........................  5
   Three Months Ended March 31, 1999 and 1998

  Consolidated Statements of Cash Flows ..................................  6
   Three Months Ended March 31, 1999 and 1998

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

 ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
          CONDITION AND RESULTS OF OPERATIONS ............................ 11

PART II  OTHER INFORMATION
 SIGNATURES .............................................................. 17











































2 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART I  FINANCIAL INFORMATION
CONSOLIDATED STATEMENTS OF CONDITION
(In thousands)
                                                                             
                                                          MARCH 31,  DEC 31, 
ASSETS                                                       1999      1998  
Cash and due from banks ................................  $ 15,914   $ 24,145
Money market investments ...............................       516        479
Investment securities (fair value $172,804 and $162,556)   171,998    161,619
  
Loans (net of unearned income of $3,210 and $3,253) ....   408,064    390,109
Reserve for loan losses ................................     4,114      3,912
                                                          ___________________
Net loans ..............................................   403,950    386,197

Bank premises and equipment ............................    15,916     15,901
Other assets ...........................................    10,321      9,452
                                                          ___________________
TOTAL ASSETS ...........................................  $618,615   $597,793
                                                          ===================
LIABILITIES  
Deposits:  
Noninterest-bearing ....................................  $ 48,273   $ 55,339
Interest-bearing .......................................   421,840    402,333
                                                          ___________________
Total deposits .........................................   470,113    457,672
Federal funds purchased and securities sold under
 agreements to repurchase ..............................    22,413     23,325
Other borrowings .......................................    69,769     62,830
Other liabilities ......................................     7,021      5,773
                                                          ___________________
TOTAL LIABILITIES ......................................   569,316    549,600

SHAREHOLDERS' EQUITY  
Common stock($3.33 par value), 15,000,000 shares
authorized; issued and outstanding--4,695,606 shares
in 1999 and 4,468,461 shares in 1998 ...................    14,892     14,881
Additional paid-in capital .............................    18,902     18,891
Retained earnings ......................................    14,448     13,173
Accumulated other comprehensive income..................     1,057      1,248
                                                          ___________________
TOTAL SHAREHOLDERS' EQUITY .............................    49,299     48,193
                                                          ___________________
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY .............  $618,615   $597,793
                                                          ===================

See notes to consolidated financial statements.




















3 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART I  FINANCIAL INFORMATION
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)          THREE MONTHS  
                                              ENDED MARCH 31,
                                              1999      1998 
INTEREST INCOME  
Interest and fees on loans ................  $8,113   $7,170 
Interest on deposits with banks ...........       7        5 
Interest and dividends on 
 investment securities ....................   2,528    2,806 
                                             ________________
Total interest income .....................  10,648    9,981 
INTEREST EXPENSE  
Interest on deposits ......................   4,348    4,195 
Federal funds purchased and securities
 sold under agreements to repurchase ......     220      365 
Interest on borrowed funds ................     895      731 
                                             ________________
Total interest expense ....................   5,463    5,291 
                                             ________________
Net interest income .......................   5,185    4,690 
Provision for loan losses .................     363      239 
                                             ________________
Net interest income after
 provision for loan losses ................   4,822    4,451 
OTHER INCOME  
Trust income ..............................     338      270 
Service charges on deposit accounts .......     434      375 
Securities gains ..........................      63      222 
Net gains on loan sales ...................     349      247 
Equity in losses of real estate ventures...     -54      -37 
Other .....................................     302      253 
                                             ________________
Total other income ........................   1,432    1,330 
OTHER EXPENSES  
Salaries and employee benefits ............   2,219    2,016 
Occupancy and premises ....................     304      251 
Furniture and equipment ...................     341      295 
Marketing .................................     174      151 
Net cost of operation
 of other real estate .....................      -1        6 
Supplies ..................................     155      119 
Other taxes ...............................     109       96 
Other .....................................     754      763 
                                             ________________
Total other expenses ......................   4,055    3,697 
                                             ________________
Income before income taxes ................   2,199    2,084 
Applicable income taxes ...................     387      476 
                                             ________________
NET INCOME ................................  $1,812  $ 1,608 
                                             ================
PER SHARE DATA  

Net income ................................  $ 0.39   $ 0.34 
                                             ================
Net income, assuming dilution..............  $ 0.38   $ 0.34 
                                             ================
Dividends .................................  $ 0.11   $ 0.10 
                                             =================
See notes to consolidated financial statements.






4 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART I  FINANCIAL INFORMATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)                                                THREE MONTHS
                                                             ENDED MARCH 31,
                                                           1999        1998
_____________________________________________________________________________
Net income ............................................  $1,812       $1,608 
Other comprehensive income:
Unrealized gains (losses) on securities arising during
  period ..............................................    -265          288 
Reclassification adjustment for gains included in net
  income ..............................................     -25         -222 
                                                         ____________________
Other comprehensive income (loss) before tax ..........    -290           66 
Income taxes (benefits) related to other comprehensive
  income ..............................................     -99           23 
                                                         ____________________
Other comprehensive income (loss) .....................    -191           43 
                                                         ____________________
COMPREHENSIVE INCOME ..................................  $1,621       $1,651 
                                                         ====================


See notes to consolidated financial statements.










































5 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART I  FINANCIAL INFORMATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)                                              THREE MONTHS 
                                                           ENDED MARCH 31, 
                                                          1999        1998
______________________________________________________________________________
CASH FLOWS FROM OPERATING ACTIVITIES:  
Net income ..........................................    $ 1,812    $ 1,608
Adjustments to reconcile net income to net cash
 from operating activities:
Depreciation and amortization........................        314        330 
Net amortization of investment security premiums ....         58         49 
Provision for loan losses ...........................        363        239 
Gain on sale of securities held-to-maturity .........        -38          0 
Gain on sale of securities available-for-sale .......        -25       -222 
Gain on sale of fixed assets ........................          0          0 
Loans originated for sale ...........................    -20,317    -14,450 
Proceeds from sales of loans ........................     20,773     15,045 
Gain on sale of loans ...............................       -349       -247 
(Gain) loss on sale of other real estate ............         -5          0 
Net deferred loan fees ..............................       -297       -282 
Equity in losses of real estate ventures.............         55         37 
Increase in interest/dividends receivable ...........        -86         -2 
Increase in interest payable ........................        278        279 
Increase in other assets ............................       -384       -820 
Increase in other liabilities .......................        788      2,201 
                                                         ___________________
Net cash provided by operating activities ...........      2,940      3,765 
CASH FLOWS FROM INVESTING ACTIVITIES:  
Proceeds from sales and maturities of securities
 held-to-maturity ...................................      8,316      1,457 
Proceeds from sales and maturities of securities
 available-for-sale .................................     11,487     12,877 
Purchases of securities held-to-maturity ............          0          0 
Purchases of securities available-for-sale ..........    -30,467     -5,095 
(Increase)decrease in net loans .....................    -18,056    -27,479 
Capital expenditures ................................       -322       -103 
Proceeds from sale of fixed assets ..................          0          1 
Net (purchase) return of investment in real estate
 ventures ...........................................       -205       -721 
Proceeds from sale of other real estate .............        153        134 
                                                        ____________________
Net cash used in investing activities ...............    -29,094    -18,929 
CASH FLOWS FROM FINANCING ACTIVITIES:  
Net increase(decrease)in demand deposits
 and savings accounts ...............................      3,137     22,845 
Net increase in certificates of deposit .............      9,310      1,982 
Net increase in federal funds purchased
 and repurchase agreements ..........................       -912    -11,774 
Net increase (decrease) in other borrowings .........      6,951      9,954 
Payments made for capital leases ....................        -11        -10 
Dividends paid ......................................       -536       -445 
Proceeds from issuance of common stock ..............         21         55 
                                                        ____________________
Net cash provided by financing activities ...........     17,960     22,607 
                                                        ____________________
NET DECREASE IN CASH & CASH EQUIVALENTS .............     -8,194      7,443 
CASH & CASH EQUIVALENTS AT JANUARY 1, ...............     24,624     14,928 
                                                        ____________________
CASH & CASH EQUIVALENTS AT MARCH 31, ................    $16,430    $22,371 
                                                        ====================


See notes to consolidated financial statements.



6 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART I  FINANCIAL INFORMATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE A - BASIS OF PRESENTATION

In the opinion of management, the accompanying consolidated financial
statements contain all adjustments (including normal recurring accruals)
considered necessary to present fairly Drovers Bancshares' financial position
as of March 31, 1999 and December 31, 1998.  Operating results and changes in
cash flows for the three months ended March 31, 1999 are not necessarily
indicative of the results that may be expected for the year ended December 31,
1999.  For further information, refer to the consolidated financial
statements and footnotes included in the Annual Report for the year ended
December 31, 1998.

NOTE B - CALCULATION OF EARNINGS PER SHARE

On April 28, 1999, the Corporation declared a 5% stock split to shareholders
of record on May 7, 1999 and payable May 28, 1999.  Net income per share is
computed based on the weighted average number of shares outstanding each
period, giving retroactive effect to the 5% dividend declared in 1999, the
3-for-2 stock split paid in 1998 and a 5% dividend paid in 1997.  Earnings per
common share, assuming dilution gives effect to all dilutive potential common
shares during each period.

NOTE C - INVESTMENT SECURITIES

The amortized cost and estimated fair value of investment securities
Classified as held-to-maturity as of March 31, 1999 are as follows:

<TABLE>
<CAPTION>
                                                     Gross      Gross 
                                        Amortized Unrealized Unrealized  Fair  
(In thousands)                             Cost      Gains      Losses   Value
<S>                                        <C>        <C>       <C>       <C>
US Treasury securities and obligations
 of US government corp and agencies ...  $ 2,486     $ 55        $0     $ 2,541
Obligations of states and political
 subdivisions .........................   15,853      634         0      16,487
Mortgage-backed securities and
 collateralized mortgage obligations ..    7,681      126         9       7,798
                                        _______________________________________
Total investment securities ...........  $26,020     $815        $9     $26,826
                                        =======================================
</TABLE>






















7 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART I  FINANCIAL INFORMATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE C - INVESTMENT SECURITIES, continued

The amortized cost and estimated fair value of investment securities
classified as available-for-sale as of March 31, 1999 are as follows:

                                                    Gross      Gross   
                                       Amortized Unrealized Unrealized  Fair
(In thousands)                            Cost      Gains      Losses   Value
US Treasury securities and obligations
 of US government corp and agencies ..  $  7,510   $   63     $  5   $  7,568
Obligations of states and political
 subdivisions ........................     7,539      206       57      7,688
Corporate obligations ................    10,153       71       54     10,170
Mortgage-backed securities and
 collateralized mortgage obligations .   100,683    1,010      368    101,325
                                      _______________________________________
Total debt securities ................   125,885    1,350      484    126,751
Equity securities ....................    18,491      821       85     19,227
                                      _______________________________________
Total investment securities ..........  $144,376   $2,171     $569   $145,978
                                      =======================================

The amortized cost and estimated fair value of investment securities
Classified as held-to-maturity as of December 31, 1998 are as follows:

                                                    Gross      Gross 
                                       Amortized Unrealized Unrealized  Fair
(In thousands)                            Cost      Gains     Losses    Value
US Treasury securities and obligations
 of US government corp and agencies ..  $ 8,476    $  139     $  0   $  8,615
Obligations of states and political
 subdivisions ........................   16,926       697        0     17,623
Mortgage-backed securities and
 collateralized mortgage obligations .    8,857       124       23      8,958
                                      _______________________________________
Total investment securities ..........  $34,259    $  960     $ 23   $ 35,196
                                      =======================================

The amortized cost and estimated fair value of investment securities
Classified as available-for-sale as of December 31, 1998 are as follows:

                                                    Gross      Gross 
                                       Amortized Unrealized Unrealized  Fair
(In thousands)                            Cost      Gains     Losses    Value
US Treasury securities and obligations
 of US government corp and agencies ..  $  7,014   $  105     $  0   $  7,119
Obligations of states and political
 subdivisions ........................     7,541      243       24      7,760
Corporate obligations.................     4,726       21       81      4,666
Mortgage-backed securities and
 collateralized mortgage obligations .    88,304      973      243     89,034
                                       ______________________________________
Total debt securities ................   107,585    1,342      348    108,579
Equity securities ....................    17,884      930       33     18,781
                                       ______________________________________
Total investment securities ..........  $125,469   $2,272     $381   $127,360
                                       ======================================

For additional information, see pages 22-23 of the Corporation's 1998 Annual
Report.




8 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART I  FINANCIAL INFORMATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE D - LOANS

Loans are comprised of the following as of March 31, 1999 and
December 31, 1998:

                                                         MARCH 31,   DEC 31,
(In thousands)                                             1999      1998
Commercial, financial and industrial loans ...........  $121,685   $117,997 
Real estate mortgage loans:  
  Real estate construction-related ...................    14,981     13,523 
  Real estate mortgage loans secured by
    1-4 family residential properties ................   127,968    126,542 
  Other real estate ..................................   111,431    100,585 
                                                        ____________________
Total real estate mortgage loans .....................   254,380    240,650 
Consumer loans:  
  Monthly payment ....................................    31,062     30,498 
  Other revolving credit .............................       848        791 
                                                        ____________________
Total consumer loans .................................    31,910     31,289 
Leasing and other ....................................        89        173 
                                                        ____________________
Total loans ..........................................  $408,064   $390,109 
                                                        ====================

Changes in the reserve for loan losses for the periods ended March 31, were
as follows:
  
(In thousands)                                             1999       1998
Balance, beginning of year ...........................    $3,912     $3,304 
Provision for loan losses ............................       363        239 
LESS: Loans charged-off ..............................       167         62 
Recoveries ...........................................         6         30 
                                                        ____________________
Balance, March 31 ....................................    $4,114     $3,511 
                                                        ====================
As of March 31, 1998, the total recorded investment in impaired loans was
$2,611,000. Nonaccrual loans at March 31, 1999 were $1,110,000 compared to
$1,435,000 at December 31, 1998.

Residential mortgage loans with a book value of $5,085,000 were held for sale
at March 31, 1999.  The cumulative fair value exceeded the book value of these
loans.  Loans held for sale are included in total loans.  During the first
quarter of 1999, the Corporation capitalized $130,000 in loan servicing
rights and amortized $50,000.

For additional information, see pages 23-24 of the Corporation's 1999 annual
report.
















9 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART I  FINANCIAL INFORMATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE E - COMPREHENSIVE INCOME

The income tax expense or benefit allocated to each component of other
comprehensive income for the periods ended March 31, were as follows:

 (In thousands)                                               1999      1998 
Unrealized gains (losses) on securities arising during
  period ...............................................      $-90       $98 
Reclassification adjustment for gains included in 
  net income ...........................................        -9       -75 
                                                            _________________
Income taxes (benefits) related to other comprehensive
  income ...............................................      $-99       $23 
                                                            =================

Accumulated other comprehensive income as of March 31, was as follows:
   
(In thousands)                                               1999      1998 
Balance, January 1,.....................................    $1,248    $1,593 
Current-period change ..................................      -191        43 
                                                            _________________
Balance, March 31, .....................................    $1,057    $1,636 
                                                            =================

All components of accumulated other comprehensive income were as a result of 
unrealized gains (losses) on investment securities available-for-sale.






































10 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART I  FINANCIAL INFORMATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FINANCIAL CONDITION

The following comparison of actual balances indicates how the Corporation has
generated and employed its funds for the three months ending March 31, 1999:
                                        BALANCE                       BALANCE
                                        MARCH 31,  INCREASE            DEC 31,
                                         1999     (DECREASE)    %      1998
FUNDING USES:                                         (In thousands)   
Money market investments ............  $    516   $    37      7.7%  $    479
Investment securities ...............   171,998    10,379      6.4%   161,619
Loans (net) .........................   403,950    17,753      4.6%   386,197
                                       _______________________________________
Total interest-bearing assets .......   576,464    28,169      5.1%   548,295
Noninterest-bearing assets ..........    42,151    -7,347    -14.8%    49,498
                                       _______________________________________
TOTAL USES ..........................  $618,615   $20,822      3.5%  $597,793
                                       =======================================
FUNDING SOURCES:    
Interest-bearing demand deposits ....  $ 51,635   $   424      8.3%  $ 51,211
Savings deposits ....................   130,237     8,758      7.2%   121,479
Time deposits .......................   239,968    10,325      4.5%   229,643
Short-term borrowings ...............    22,413      -912     -3.9%    23,325
Long-term borrowings ................    69,769     6,939      1.1%    62,830
                                       _______________________________________
Total interest-bearing liabilities ..   514,022    25,534      5.2%   488,488
Noninterest-bearing demand deposits .    48,273    -7,066    -12.8%    55,339
Other liabilities ...................     7,021     1,248     21.6%     5,773
Shareholders' equity ................    49,299     1,106      2.3%    48,193
                                       _______________________________________
TOTAL SOURCES .......................  $618,615   $20,822      3.5%  $597,793
                                       =======================================
Total assets increased $20,822,000 from December 31, 1998.  Loans grew
$17,753,000, or 4.6%, and investments grew $10,379,000, or 6.4%.  The growth
in loans and investments was partially offset by an $8,231,000 decrease in
cash and due from banks.  Commercial loan demand was strong, accounting for
$14,514,000 of the loan growth.  The growth in commercial loans includes a
$10,846,000, or 10.8%, increase in commercial loans secured by real estate.
Consumer loan and residential mortgage growth remained flat.  

During the first quarter of 1999, management increased holdings in investment
securities $10,379,000 to leverage the Corporation's strong capital base.
Total investment purchases were $30,467,000.  The purchases were mostly fixed
rate mortgage-backed and collateralized mortgage obligations and variable rate
corporate obligations.  The Corporation also sold $5,991,000 of U.S.
government corporate and agency bonds, classified as held-to-maturity.  These
bonds were within three months of a probable call date.  The sales resulted in
gains of $26,000.

Deposits funded most of the asset growth during the quarter.  Total deposits
grew $12,441,000.  Most of the total deposit growth was in certificates of
deposit and other time deposits which increased $10,325,000, or 4.5%, and
savings deposits which increased $8,758,000, or 7.2%. The savings growth
includes the Corporation's Indexed Money Fund, a savings product that pays a
money market interest rate.  The Indexed Money Fund increased $3,989,000.  The
growth in time deposits and savings deposits was partially offset by a
$7,066,000 decrease in noninterest-bearing deposits.







11 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART I  FINANCIAL INFORMATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

LOAN QUALITY

Loans totaling $2,611,000 were classified as impaired at March 31, 1999.  This
compares to $1,748,000 at December 31, 1998.  Loans to one borrower for
$1,000,000 were recently classified as impaired when possible credit problems
became known.  The loans are secured by real estate and investment securities.
Nonaccrual loans were $1,110,000 compared to $1,435,000 at the end of 1998.

Loan charge-offs were $167,000 in the first quarter, of which $100,000 were
commercial loans and $67,000 were consumer loans.  Recoveries were $6,000.  At
March 31, 1999, the reserve for loan losses stood at 1.01% of total loans.

RESULTS OF OPERATION

Drovers Bancshares recorded net income of $1,812,000 and $1,608,000 for the
three months ended March 31, 1999 and 1998, respectively. 

The return on assets (ROA) and return on equity (ROE) for the three months
ended March 31, 1999 was 1.22% and 14.87%, respectively.  This compares to an
ROA and ROE for the same period last year of 1.21% and 14.67%, respectively.

NET INTEREST INCOME

Net interest income is the difference between the interest earned on loans and
investments and the interest paid on deposits and other sources of funds.  The
following table presents the trends in net interest income:

                                      THREE MONTHS        
                                      ENDED MARCH 31,       
(In thousands)                  1999      1998   99/98
Interest income ............  $10,648    $9,981   6.7%
Interest expense ...........    5,463     5,291   3.3%
                              __________________________ 
Net interest income ........    5,185     4,690  10.6%
Provision for loan losses ..      363       239  51.9%
                              __________________________
Net interest income after
 provision for loan losses .  $ 4,822    $4,451   8.3%
                              ==========================

The Corporation's largest category of earning assets consists of loans to
businesses and individuals.  The majority of earning assets are supported by
interest-bearing commercial and consumer deposits and shareholders' equity. 
Changes in net interest income are determined by variations in the volume and
mix of assets and liabilities as well as their sensitivity to interest rate
movements. 

Net interest income increased $495,000, or 10.6%, compared to the first
quarter of 1998.  The net interest margin remained steady at 3.73% in the
first quarter of this year compared to 3.75% last year.  An increase in
earning assets offset any decline in yields.  Average earning assets were
$562,943,000 and $507,029,000 during the first quarter of 1999 and 1998,
respectively.  The first quarter of 1998 margin included about $100,000 in
non-recurring loan service charges. The fourth quarter 1998 margin was 3.61%
and averaged 3.67% for the year.  The first quarter average yield on time
deposits declined 0.18% boosting the margin from the fourth quarter 1998.







12 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART I  FINANCIAL INFORMATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

NET INTEREST INCOME, continued

The provision for loan losses increased from $239,000 last year to $363,000 in
the first quarter of 1998.  First quarter net charge-offs were $161,000
compared to $32,000 for the same period last year.  Loans have increased
$67,084,000, or 19.7%, over the past twelve months.  The reserve for loan
losses as a percentage of loans was 1.01% at March 31, 1999.  This compares to
1.00% at the end of 1998.

NONINTEREST INCOME   
                                           THREE MONTHS      
                                           ENDED MARCH 31,     
(In thousands)                          1999   1998  98/97
Trust income ........................ $  338 $  270   25.2%
Service charges on deposit accounts .    434    375   15.7%
Securities gains ....................     63    222  -71.6%
Net gains on loan sales .............    349    247   41.3%
Equity in losses of
 real estate ventures................    -54    -37   45.9%
Other ...............................    302    253   19.4%
                                      _______________________
Total ............................... $1,432 $1,330    7.7%
                                      =======================

Noninterest income increased $102,000, or 7.7%, during the first quarter.
Net gains on residential mortgage loan sales were $349,000 in the first
quarter, a 41.3% increase over the same period last year.  Mortgage loan sales
totaled about $20,317,000 in the first quarter.  Securities gains declined
$159,000.  The Corporation liquidated a portion of its community bank stock
portfolio in the first quarter of 1998.

Income from the Investment Services and Trust Division increased $68,000
during the first quarter.  The fair value of investments managed by the
division was $258,849,000 at March 31, 1999, an increase of $29,866,000, or
13.0%, over the prior year.  The division has experienced growth in employee
benefits, personal trust and investment management accounts.  Overall
increases in the equity markets the past three years helped boost the value of
assets managed and the related fee income.

Service charges on deposit accounts increased $59,000 during the first quarter.
An increase of $34,000 in collection of insufficient fund and return check
charges caused most of the growth.

Other income increased $49,000, or 19.4%.  The Corporation offers ATM and
debit cards, charges surcharges for non-customers using our ATM machines and
provides electronic interchange services for various merchants.  The fees
associated with these electronic transactions have steadily increased and
account for $39,000 of the increase in other income.















13 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART I  FINANCIAL INFORMATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

NONINTEREST EXPENSE   
                                         THREE MONTHS        
                                         ENDED MARCH 31,       
(In thousands)                     1999    1998    99/98 
Salaries and employee benefits .  $2,219  $2,016    10.1%
Occupancy and premises .........     304     251    21.1%
Furniture and equipment ........     341     295    15.6%
Marketing ......................     174     151    15.2%
Net cost of operation
 of other real estate ..........      -1       6  -116.7%
Supplies .......................     155     119    30.3%
Other taxes ....................     109      96    13.5%
Other ..........................     754     763    -1.2%
                                  ________________________
Total ..........................  $4,055  $3,697     9.7%
                                  ========================
Noninterest expense increased $358,000, or 9.7%, compared to the first
quarter of 1998.  Salaries and benefits are the largest component of
noninterest expense and increased $203,000 for the quarter.  Staffing at the
new Hellam office, which opened in January 1999, contributed to the increase.
Average full-time equivalent staffing levels were 219 during the quarter ended
March 31, 1999 compared to 215 a year ago.

Occupancy and premises expense increased $53,000.  The opening of the Hellam
office contributed to this increase. Furniture and equipment expense increased
$46,000 due to increases in equipment depreciation and maintenance contracts.
Other expenses declined $9,000 as increases in data processing, legal and loan
servicing rights amortization were offset by a decrease in consulting services.

TAXATION

The Corporation recognized a provision for income taxes of $387,000 for the
three months ending March 31, 1999.  The average tax rate, applicable income
taxes divided by income before taxes, was 17.6%.  This compares to an average
tax rate of 16.6% for all of 1998.  The Corporation manages its tax rate
through the purchase of tax exempt investment securities and investments in
low-income housing partnerships that provide historic and low-income tax
credits. 

MARKET RISK

The Corporation's primary market risk is the risk of changes in net interest 
income caused by changes in interest rates.  Management monitors ongoing 
interest rate risk through monthly "gap" reports and quarterly computer 
simulations of net interest income.  Measurements continue to indicate the 
Corporation is slightly asset sensitive but well within the tolerance limits
established by Management.

FUTURE OUTLOOK

The Corporation plans to construct two new branch offices in 1999.  Land near
Dillsburg, Pennsylvania was purchased in 1998.  Construction of the new branch
should begin in May 1999.  A contract has been signed to purchase land at the
Newberrytown exit of I-83 in Newberry Township for a new branch office.
Construction of this branch should begin in July 1999.  We plan to open both of
these branches in the fourth quarter of 1999.

The Corporation opened its first loan production office (LPO) in April 1999.
The office is located at the Rossmoyne Business Center in Cumberland County,
near Harrisburg.  This is the Corporation's first facility outside York County.
The staff at the LPO will initially focus on commercial lending.


14 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART I  FINANCIAL INFORMATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

FUTURE OUTLOOK, continued

The Financial Accounting Standards Board issued Statement of Accounting
Standards No. 133, "Accounting for Derivative Instruments and Hedging
Activities."  The Statement establishes accounting and reporting
standards for derivative instruments, including certain derivative
instruments embedded in other contracts and for hedging activities.  The
Standard becomes effective for fiscal years beginning after June 15,
1999.  The Corporation has not completed its assessment of the impact, if
any, to earnings from applying this Standard. 

YEAR 2000 ISSUE 

The following contains forward-looking statements which involve risks and
uncertainties.  The actual impact on the Corporation of the Year 2000 issue
could materially differ from that which is anticipated in the forward-looking
statements as a result of certain factors identified below.

The Year 2000 issue ("Y2K") is the result of some computer systems' inability
to recognize and process a date in the year 2000.  This could result in system
failures, miscalculations and disruptions of normal business operations.

Corporation's State of Readiness

The Corporation relies heavily on various internal information technology (IT)
and non-information technology (Non-IT) systems and third parties.  The
Corporation has identified and tested all critical IT and Non-IT systems.  A
small number of systems were found to be noncompliant.  As of December 31,
1999, remediation, testing and implementation of all mission critical systems
was complete.  The Corporation continues to assess all new systems and
significant upgrades to existing systems.

Year 2000 certification information was requested from all material third
parties, including loan customers.  Based on the responses received and
information gathered, the Corporation has not identified any material third
parties with Year 2000 issues that would interrupt normal business operations.

Costs of Year 2000

The costs to remediate the Corporation's IT and Non-IT systems have been minor
and are expected to total less than $100,000.  As of December 31, 1998, $65,000
has been expended on Year 2000 costs.  An additional $4,000 was expensed
in the first quarter of 1999.  The Corporation does not expect the amounts
required to be expensed over the next 9 months to have a material effect on the
financial position or results of operations.  However, if compliance is not
achieved in a timely manner by the Corporation or any of its significant
related third parties, be it a supplier of services or a customer, the Y2K
issue could possibly have a material effect on the Corporation's operations
and financial position.













15 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART I  FINANCIAL INFORMATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

YEAR 2000 ISSUE, continued

Risks of Year 2000

At present, the Corporation believes its progress in remedying the critical
systems and monitoring its third parties' Y2K readiness is on target.  The Y2K
computer problem creates risk for the Corporation from unforeseen problems in
its own computer systems and from third party vendors' computer systems, which
interface with the Corporation's computer applications.  Failure of third
party systems relative to the Y2K issue could have a material impact on the
Corporation's ability to conduct business.

Contingency Plans

At the present time, the Corporation is not aware of any reasonably likely
scenarios that would materially disrupt business operations.  The Corporation
is developing contingency plans to address situations that could arise despite
a low probability of occurrence.  The Corporation has adopted the FFIEC four
step plan: organizational planning, business impact analysis, development of
plan and validation.  The organizational planning phase and a business impact
analysis have been completed.  Contingency plans are significantly complete
and will be tested throughout the process.  The Corporation expects to
complete contingency planning by June 30, 1999, but will continue updating and
testing the plan throughout the year.

For additional information, see pages 38-39 of the Corporation's 1998 Annual
Report.




































16 <PAGE>
Drovers Bancshares Corporation and Subsidiaries
PART II  OTHER INFORMATION
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.

                                   DROVERS BANCSHARES CORPORATION




                                   __/S/ A. Richard Pugh___________________
                                   A. Richard Pugh, Chairman, President and
                                   Chief Executive Officer




                                   __/S/ Debra A Goodling__________________
                                   Debra A. Goodling, Executive Vice President
                                     and Treasurer
                                   Principal Financial Officer




                                   __/S/ John D. Blecher__________________
                                   John D. Blecher, Senior Vice President,
                                     Secretary and Assistant Treasurer
                                   Principal Accounting Officer


                                   Date:  May 10, 1999
































17 <PAGE>