U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

(Mark One)

[x]           QUARTERLY REPORT PURSUANT SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                 For the quarterly period ended: March 31, 1999

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

   For the transition period from _____________________ to __________________

                         Commission file number 0-17232

                           CAPITAL RESERVE CORPORATION
        (Exact name of small business issuer as specified in its charter)

           COLORADO                                         84-0888594
(State or other jurisdiction of                          (IRS Employer
 incorporation or organization)                        Identification No.)

        #11-1861 BEACH AVENUE, VANCOUVER, BRITISH COLUMBIA V6G 1Z1 CANADA
                    (Address of principal executive offices)

                                 (604) 687-4828
                           (Issuer's telephone number)

                                 NOT APPLICABLE
              (Former name, former address and former fiscal year,
                          if changed since last report)

     Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 __

     State the number of shares outstanding of each of the issuer's classes of
common equity, as of the last practicable date:

          1,411,045 SHARES OF CLASS A COMMON STOCK, NO PAR VALUE, AS OF
                                  MAY 14, 1999

     Transitional Small Business Disclosure Format (check one); Yes___ No _X_

Exhibit index on page 11                                      Page 1 of 14 pages



<PAGE>









                         INDEPENDENT ACCOUNTANTS' REPORT

Board of Directors
Capital Reserve Corporation


The accompanying consolidated balance sheet of Capital Reserve Corporation as of
March 31, 1999,  and the related  consolidated  statements of operations for the
three months ended March 31, 1999,  and 1998 and cash flows for the three months
ended March 31, 1999,  and 1998 were not audited by us, and  accordingly,  we do
not express an opinion on them.

Consistent with the requirements of Item 310(b) of Regulation S-B management has
elected to omit  substantially  all of the  disclosures  required  by  generally
accepted accounting principles.  If the omitted disclosures were included in the
financial  statements,  they might  influence the user's  conclusions  about the
Company's  financial  position,  results  of  operations,  and its  cash  flows.
Accordingly,  these financial  statements are not designed for those who are not
informed about such matters.





/s/Miller and McCollom, CPA's
Miller and McCollom, CPA's












Denver, Colorado
May 8, 1999


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<PAGE>


<TABLE>


                           CAPITAL RESERVE CORPORATION
                           CONSOLIDATED BALANCE SHEET
                                 MARCH 31, 1999

                                   (Unaudited)

<CAPTION>

ASSETS

<S>                                                                                           <C>
CURRENT ASSETS
   Cash and cash equivalents                                                                          $   9,538
   Accounts receivable                                                                                    2,500
   Prepaid consulting - related party                                                                    25,000
                                                                                              -----------------
     Total current assets

TOTAL ASSETS                                                                                           $ 37,038
                                                                                              =================

<CAPTION>

LIABILITIES AND STOCKHOLDERS' EQUITY

<S>                                                                                           <C>
CURRENT LIABILITIES
   Accounts payable                                                                                   $   7,769
   Accounts payable - related party                                                                         261
                                                                                              -----------------
     Total current liabilities                                                                            8,030
                                                                                              -----------------

   STOCKHOLDERS' EQUITY
     Class A common stock                                                                             3,216,012
     Class B preferred stock                                                                             50,000
     Accumulated deficit                                                                            (3,237,004)
                                                                                              -----------------

                                                                                                         29,008
                                                                                              -----------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                                             $ 37,038
                                                                                              =================

</TABLE>



            See accountants' report and notes to financial statements


                                        3

<PAGE>


<TABLE>
<CAPTION>

                           CAPITAL RESERVE CORPORATION
                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                   (Unaudited)


                                                                                     Three Months Ended
                                                                                          March 31,
                                                                             -----------------------------------

                                                                                  1999                 1998
                                                                             ---------------     -----------------
<S>                                                                           <C>                <C>        
Revenues
   Insurance residuals                                                        $            -           $     1,877
   Interest and dividends                                                                  -                    15
   Investment (loss) gains                                                                 -               (8,080)
   Loss on sale of assets                                                                  -              (13,813)
   Other                                                                                   -                15,035
                                                                             ---------------     -----------------

     Total revenues                                                                        -               (4,966)

<CAPTION>
Expenses
   General and administrative                                                         27,371                12,806
                                                                             ---------------     -----------------

Net (loss)                                                                        $ (27,371)           $  (17,772)
                                                                             ===============     =================

Net (loss) per common share                                                    $       (.02)        $        (.03)
                                                                             ===============     =================

Weighted average shares outstanding                                                1,261,045               546,045
                                                                             ===============     =================

</TABLE>


            See accountants' report and notes to financial statements


                                        4

<PAGE>


<TABLE>
<CAPTION>
                           CAPITAL RESERVE CORPORATION
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY



                                             Class A                                     CLASS B
                                              Stock                                       STOCK
                                             Common                                     PREFERRED
                              -------------------------------------      ---------------------------------------

                                                                                                                    ACCUMULATED
                                    Shares             AMOUNT                SHARES            AMOUNT                 DEFICIT

<S>                            <C>                <C>                    <C>               <C>                  <C>          
December 31, 1997                       546,045         $ 3,138,102              250,000          $ 50,000             $ (3,166,302)
Issuance of common
  stock net of offering
    cost of $4,940                      250,000              20,060                    -                 -                         -
Net (loss)                                    -                   -                    -                 -                  (43,331)
                               ----------------   -----------------      ---------------   ---------------      --------------------

December 31, 1998                       796,045           3,158,162              250,000            50,000               (3,209,633)

Issuance of common
  stock net of offering
    cost of $3,650                      615,000              57,850                    -                 -                         -
Net (loss)                                    -                   -                    -                 -                  (27,371)
                               ----------------   -----------------      ---------------   ---------------      --------------------
                                      1,411,045         $ 3,216,012              250,000          $ 50,000             $ (3,237,004)
                               ================   =================      ===============   ===============      ====================

</TABLE>

            See accountants' report and notes to financial statements


                                        5

<PAGE>

<TABLE>
<CAPTION>


                           CAPITAL RESERVE CORPORATION
                      Consolidated Statements of Cash Flows
                                   (Unaudited)


                                                                                  Three Months Ended
                                                                                       March 31,
                                                                        ---------------------------------------

                                                                               1999                   1998
                                                                        -------------------     -----------------
<S>                                                                     <C>                     <C>       
Operations activities:
   Net loss                                                                      $ (27,371)            $ (17,772)
                                                                        -------------------     -----------------
   Reconciling adjustments:
     Depreciation and amortization                                                        -                   964
     Loss (gain) on investments                                                           -                 8,080
     Loss on sale of assets                                                               -                13,813
     Other                                                                                -               (4,645)
Changes in assets and liabilities:
   Other current assets                                                            (27,500)                    93
   Accounts payable                                                                 (4,958)              (15,839)
                                                                        -------------------     -----------------

     Total adjustments                                                             (32,458)                 2,466
                                                                        -------------------     -----------------

Net cash used for operating activities                                             (59,829)              (15,306)
                                                                        -------------------     -----------------

Investing activities:
   Investments in common stock                                                            -               (1,893)
   Sales of investments in common stock                                                   -                 6,232
   Proceeds from sale of assets                                                           -                 5,843
                                                                        -------------------     -----------------

     Net cash provided by investing activities                                            -                10,182
                                                                        -------------------     -----------------

Financing activities:
   Issuance of common stock                                                          61,500                     -
   Offering costs                                                                   (3,650)                     -
                                                                        -------------------     -----------------

     Net cash provided by financing activities                                       57,850                     -
                                                                        -------------------     -----------------

Net change in cash and cash equivalents                                             (1,979)               (5,124)
Cash and cash equivalents at beginning of period                                     11,517                 8,748
                                                                        -------------------     -----------------

Cash and cash equivalents at end of period                                      $     9,538            $    3,624
                                                                        ===================     =================

</TABLE>


            See accountants' report and notes to financial statements


                                        6

<PAGE>



                           CAPITAL RESERVE CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                 MARCH 31, 1999

                                   (Unaudited)

NOTE 1 - MANAGEMENT'S STATEMENT

In the opinion of management,  the accompanying unaudited consolidated financial
statements  contain all  adjustments  (all of which are normal and  recurring in
nature)  necessary to present fairly the financial  position of Capital  Reserve
Corporation  as of March 31, 1999,  and the results of operations  for the three
months ended March 31, 1999,  and 1998 and cash flows for the three months ended
March 31, 1999, and 1998. The Notes to Consolidated  Financial  Statements which
are  contained  in the  Form  10-K  should  be read in  conjunction  with  these
consolidated financial statements.

NOTE 2 - RELATED PARTY TRANSACTION

CHANGE IN CONTROL

On October  6,  1998,  Glen C. Loder  entered  into an  agreement  with Ralph W.
Newton,  Jr., the former president and director of the Company,  and Patricia L.
Newton,  Mr.  Newton's  wife to  purchase  their  ownership  of 140,000  Class B
Preferred Stock for $40,000 plus options to purchase up to 200,000 shares of the
Company's  common stock at a price of $.25 per share which Mr. Loder would cause
the Company to issue.  The option was issued in 1999.  Mr. Loder agreed to cause
the Company to engage in a private  placement of its common stock,  of which the
first $40,000  raised would be used to pay a management  fee to Mr.  Loder.  Mr.
Loder then used the  management fee to pay the purchase  price.  This amount was
paid in 1999. (See Note 3.)

On October 6, 1998,  the Company  entered into a management  agreement  with Mr.
Loder.  The  agreement  provides  that Mr.  Loder shall serve as Chairman of the
Board of Directors and President of the Company, until terminated by the Company
or Mr. Loder.  Under the terms of the  agreement,  Mr. Loder will receive $5,000
per month plus expenses.

In March  1998,  a  Corporation  which a former  officer of the  Corporation  is
affiliated  with purchased the Company's  insurance  residual for $15,000.  This
amount is included in other revenue in the accompanying financial statements.

NOTE 3 - PRIVATE PLACEMENT OF COMMON STOCK

The Company offerred for sale up to 5,000,000 shares of its Class A common stock
at $0.10 per  share.  The  offering  provided  for a $50,000  minimum  on a best
efforts basis through its officers and directors on such sales.  As of March 31,
1999,  the Company had sold 865,000  shares for $86,500 and  incurred  $8,590 in
commission  and  offering  expense.  The Company  used the proceeds of the stock
sales prior to meeting the $50,000 minimum as provided for the private placement
summary and therefore certain buyers have the right to rescind their purchase of
stock.



                                        7

<PAGE>



ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (ITEM 303)

GENERAL

The Company has  essentially  suspended all of its  operations.  Management  has
disposed of most of the Company's  assets and applied the proceeds from the sale
of those assets to decreasing the Company's outstanding  liabilities.  As of the
date of this report the Company had no source of income.  The Company  must rely
entirely  upon  the  sale of  stock  to pay any  expenses  the  Company  incurs.
Therefore, the financial statements included in this report for the three months
ended March 31, 1999 and 1998, are not  necessarily  indicative of the Company's
future operations.

LIQUIDITY AND CAPITAL RESOURCES

The Corporation's working capital at March 31, 1999, was $29,008, as compared to
$(1,471) at December 31, 1998.  Since the Corporation has no significant  source
of revenue,  working capital will continue to be depleted by operating expenses.
Furthermore,  if the  Corporation  should  generate  an  operating  loss for the
current year  comparable  to the loss  incurred for the year ended  December 31,
1998, a  substantial  portion of the  Corporation's  remaining  cash and working
capital will be depleted.

The Corporation had current liabilities of $8,030 at March 31, 1999, as compared
to $12,988 at December 31, 1998.

RESULTS OF OPERATIONS

The  Corporation  had no revenues for the three months ended March 31, 1999. For
the three  months  ended March 31, 1998 the  Corporation  had total  revenues of
$(4,966).

Management  is in the  process  of  seeking a viable  company to acquire or with
which to merge.  Until such a company can be identified,  the Corporation has no
source of income and no viable operations.  There is no guaranty that management
will be able to locate any such company.  If the  Corporation  is able to find a
suitable merger or acquisition  candidate,  any such merger or acquisition would
most likely result in the  Corporation  having to issue a substantial  amount of
stock to consummate the transaction.

General and  administrative  expenses for the three months ended March 31, 1999,
include  consulting  fees to Mr.  Loder,  the  President  and a director  of the
Corporation, of $15,000. General and administrative expenses for the nine months
ended  March 31,  1999,  also  include:  (i) office  expenses of $5,684 and (ii)
accounting and auditing expenses of $3,000.

As compared to the three months ended March 31, 1998, operating expenses for the
current period  increased by 114%. The net loss from  continuing  operations for
the three months ended March 31,  1999,  increased by 54% compared to 1998.  The
increases in expenses and the Corporation's net loss are




                                        8

<PAGE>



attributable  to  the  consulting  fees  paid  to  Mr.  Loder,  pursuant  to the
Management Agreement between the Corporation and Mr. Loder.

During the last quarter of fiscal 1998 and the first  quarter of fiscal 1999 the
Corporation conducted a private placement of shares of the Corporation's Class A
Common  Stock,  no par value  pursuant to Rule 506 of  Regulation  D. A total of
865,000  shares were sold at a price of $0.10 per share,  for gross  proceeds of
$86,500.  The net loss per common  share for the three  months  ended  March 31,
1999, decreased by $0.01 per share due to the increase the number of outstanding
shares.

                           PART II - OTHER INFORMATION

ITEM 1.           LEGAL PROCEEDINGS

                  Not Applicable.

ITEM 2.           CHANGES IN SECURITIES

                  From November 1998 through February 1999, the Corporation
                  conducted a private placement of shares of the Corporation's
                  Class A Common Stock, no par value (the "Shares") pursuant to
                  Rule 506 of Regulation D. Sales were made to a total of ten
                  (10) Canadian citizens. A total of 865,000 shares were sold at
                  a price of $0.10 per share, for gross proceeds of $86,500. The
                  Company paid commissions of 10% to persons assisting the
                  Corporation with sales. As of March 31, 1998, Kerry Loder, the
                  son of Glen C. Loder, an officer and director of the
                  Corporation, had received commissions of $3,650 in connection
                  with the sale of shares.

                  The Company is in the process of offering rescission to the
                  purchasers of shares in the private placement based upon
                  statements by the Company that it would not pay commissions on
                  sales of shares and that the Company would terminate the
                  offering if it had not received subscriptions for $50,000 by
                  December 31, 1998.

                  The Company did not sell the minimum subscription amount of
                  $50,000 by December 31, 1998, and did not terminate the
                  offering by such date. The Company continued to offer the
                  shares and utilized funds from the sale of shares prior to
                  receiving the minimum subscription amount of $50,000. In
                  addition, the Company paid commissions of approximately 10% to
                  persons selling shares in the offering.

                  Pursuant to the terms of the Stock Purchase Agreement between
                  Mr. Loder, Ralph W. Newton and Patricia L. Newton, the Company
                  issued an option to Mr. and Mrs. Newton on February 3, 1999.
                  The option entitles Mr. and Mrs. Newton to acquire up to
                  200,000 shares of the Corporation's Class A Common Stock at a
                  price of $0.25 per share at any time on or before February 3,
                  2001. The option was issued pursuant to Section 4(2) of the
                  Securities Act of 1933, as amended.




                                        9

<PAGE>



ITEM 3.           DEFAULTS UPON SENIOR SECURITIES

                  Not Applicable

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

                  Not Applicable





                                       10

<PAGE>



ITEM 5.           OTHER INFORMATION

                  Not Applicable.

ITEM 6.           EXHIBITS AND REPORTS ON FORM 8-K
<TABLE>
                  A)       EXHIBITS
<CAPTION>

           REGULATION S-B                                                                 CONSECUTIVE
               NUMBER                        EXHIBIT                                      PAGE NUMBER
               <S>      <C>                                                                   <C>
                2       Plan of purchase, sale, reorganization
                        arrangement, liquidation, succession                                  N/A
                3(i)    Articles of Incorporation as Amended(1)<F1>                           N/A
                3(ii)   Bylaws as Amended(2)<F2>                                              N/A
                4       Instruments defining the rights of security
                        holders, including indentures                                         N/A
               10.1     Settlement Agreement(3)<F3>                                           N/A
               10.2     Sub-Contracting Agreement with Columbia
                        Financial Group(6)<F6>                                                N/A
               10.3     Management Agreement with Mr. Loder(7)<F7>                            N/A
               11       Statement re computation of per share earnings(4)<F4>                 N/A
               15       Letter on unaudited financial information(5)<F5>                      N/A
               16.1     Letter from John M. Hanson  & Company, P.C.
                        regarding change in certifying accountants(6)<F6>                     N/A
               18       Letter on change in accounting principles                             N/A
               19       Report furnished to security holders                                  N/A
               22       Published report regarding matters submitted
                        to vote of security holders                                           N/A
               23       Consents of experts and counsel                                       N/A
               24       Power of Attorney                                                     N/A
               27       Financial Data Schedule                                               ___
--------------------------------
<FN>
<F1>
(1)      Incorporated  by reference to the  Exhibits  previously  filed with the
         Corporation's  Annual  Report on Form 10-K for the  fiscal  year  ended
         December 31, 1990.
<F2>
(2)      Incorporated  by reference to the  Exhibits  previously  filed with the
         Corporation's  Annual  Report on Form  10-KSB for the fiscal year ended
         December 31, 1994.
<F3>
(3)      Incorporated  by reference to the  Exhibits  previously  filed with the
         Corporation's  Annual Report on Form  10-KSB/A  Amendment No. 1 for the
         fiscal year ended December 31, 1996.
<F4>
(4)      See Part I - Financial Statements.
<F5>
(5)      See Part I - Financial Statements.
<F6>
(6)      Incorporated  by reference to the  Exhibits  previously  filed with the
         Corporation's  Quarterly  Report on Form  10-QSB for the  period  ended
         September 30, 1997.

</FN>
</TABLE>



                                       11

<PAGE>


<F7>
(7)      Incorporated  by reference to the  Exhibits  previously  filed with the
         Corporation's  Annual  Report on Form  10-KSB for the fiscal year ended
         December 31, 1998.

         B)       REPORTS ON FORM 8-K:

                  1.       Form  8-K  dated  February  3,  1999,  reporting  the
                           closing of the stock purchase transaction between Mr.
                           Loder,  Mr.  Newton  and Mrs.  Newton,  under Item 1.
                           Changes in Control of the Registrant.



                                   SIGNATURES

         In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                   CAPITAL RESERVE CORPORATION
                                   (Registrant)

Date:    MAY 17, 1999              By:/S/GLEN C. LODER
                                   President

33199.10Q




                                       12

<PAGE>


                                   Exhibit 27

                             Financial Data Schedule




                                       13

<PAGE>