SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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


                                    FORM 10-Q

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

                  For the Quarterly Period Ended July 31, 1998

                                       OR

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

                 For the Transition Period from ______ to ______
                         Commission File Number 0-22277


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


                     EXCELSIOR PRIVATE EQUITY FUND II, INC.
             (Exact name of Registrant as specified in its charter)


            MARYLAND                                   22-3510108
(State or other jurisdiction of                       (IRS Employer
 incorporation or organization)                    Identification No.)



                                  114 West 47th Street
                                 New York, NY 10036-1532
              (Address of principal executive offices, including zip code)

                                 (212) 852-1000
                     (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.


               Yes   |_|                    No   |X|

   As of July 31, 1998,  there were 195,730  shares of the  Registrant's  Common
Stock, $.01 par value, outstanding.


748419.2

<PAGE>



                     EXCELSIOR PRIVATE EQUITY FUND II, INC.

This  Quarterly  Report  on  Form  10-Q  contains  historical   information  and
forward-looking  statements.  Statements looking forward in time are included in
this  Form  10-Q  pursuant  to the  "safe  harbor"  provisions  of  the  Private
Securities  Litigation  Reform Act of 1995. They involve known and unknown risks
and  uncertainties  that may cause the Company's  actual  results to differ from
future   performance   suggested  herein.  In  the  context  of  forward-looking
information provided in this Form 10-Q and in other reports, please refer to the
discussion  of risk  factors  detailed  in,  as well  as the  other  information
contained in, the Company's filings with the Securities and Exchange  Commission
during the past 12 months.

<TABLE>
<CAPTION>
<S>            <C>                                                                                       <C>
               INDEX                                                                                     PAGE NO.
       PART I. FINANCIAL INFORMATION

       Item 1. Financial Statements (Unaudited).

               Portfolio  of  Investments  as of July 31, 1998  (Unaudited)  and
               October 31, 1997  

               Statement  of  Assets  and   Liabilities  as  of  July  31,  1998
               (Unaudited) and October 31, 1997.

               Statement of Operations for the three month period ended July 31,
               1998  (Unaudited),  the  fiscal  year to date  at July  31,  1998
               (Unaudited), and the period from October 8, 1997 (Commencement of
               Operations) to October 31, 1997 .

               Statement  of Changes in Net  Assets for the three  month  period
               ended July 31, 1998 (Unaudited),  the fiscal year to date at July
               31,  1998  (Unaudited),  and the  period  from  October  8,  1997
               (Commencement of Operations) to October 31, 1997 .

               Notes to Financial Statements (Unaudited).

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

       Item 3. Quantitative and Qualitative Disclosures About Market Risk

      PART II. OTHER INFORMATION

       Item 1. Legal Proceedings

       Item 2. Changes in Securities

       Item 3. Defaults upon Senior Securities

       Item 4. Submission of Matters to a Vote of Securityholders

       Item 5. Other Information

       Item 6. Exhibits and Reports on Form 8-K
</TABLE>

SIGNATURES

748419.2

<PAGE>

PART I.      FINANCIAL INFORMATION

Item 1.      Financial Statements.

<TABLE>
Excelsior Private Equity Fund II, Inc.                                               Fiscal Year End:  October 31, 1998
Portfolio of Investments                                                                  Quarter Ended:  July 31, 1998
-----------------------------------------------------------------------------------------------------------------------
<CAPTION>
                                                              July 31, 1998                     October 31, 1997
                                                               (Unaudited)
                                                      -----------------------------      ------------------------------
<S>                                                      <C>                 <C>          <C>                      <C>    
PORTFOLIO STRUCTURE

    PORTFOLIO COMPANIES                             $     27,190,773         13.55%     $            --              --

PRIVATE FUNDS                                              3,041,807          1.52%                  --              --

SHORT-TERM INVESTMENTS:

    Commercial Paper                                     124,921,566         62.28%         119,559,143          76.62%

    Corporate Bonds                                       11,303,205          5.64%           6,073,060           3.89%

    U.S. Government & Agency                              20,002,564          9.97%          21,732,259          13.93%
    Obligations

    Investment Companies                                   6,418,347          3.20%           8,245,780           5.28%
                                                      --------------    -----------      --------------    ------------

    TOTAL INVESTMENTS                                    192,878,262         96.16%         155,610,242          99.72%
    OTHER ASSETS & LIABILITIES (NET)                       7,703,520          3.84%             439,299           0.28%
                                                      --------------    -----------      --------------    ------------

NET ASSETS                                          $    200,581,782        100.00%     $   156,049,541         100.00%
                                                      ==============    ===========      ==============    ============
</TABLE>

748419.2

<PAGE>

<TABLE>
Excelsior Private Equity Fund II, Inc.                                            Fiscal Year End:  October 31, 1998
Statement of Assets and Liabilities                                                    Quarter Ended:  July 31, 1998
-----------------------------------------------------------------------------------------------------------------------
<CAPTION>
ASSETS                                                                  July 31, 1998             October 31, 1997
                                                                         (Unaudited)
-------------------------------------------------------------
<S>                                                                 <C>                        <C>

Investment Securities, at Cost                                      $        192,781,473        $        155,507,901
                                                                     ===================         ===================

Investment Securities, at Value                                              192,878,262                 155,610,242


Cash                                                                           6,999,842                          63
Receivables:
  Interest                                                                     1,130,337                     512,987
Prepaid Assets                                                                    26,169                          --
Unamortized Organization Costs                                                        --                      14,811

         TOTAL ASSETS                                                        201,034,610                 156,138,103
                                                                     -------------------         -------------------

LIABILITIES
-------------------------------------------------------------

Managing Investment Advisory Fees Payable                                        364,036                      15,821
Administration & Shareholder Servicing Fees Payable                               16,005                       3,805
Directors Fees Payable                                                            22,438                      15,000
Accrued Expenses and Other Payables                                               50,349                      53,936
                                                                     -------------------         -------------------

TOTAL LIABILITIES                                                                452,828                      88,562
                                                                     -------------------         -------------------

NET ASSETS                                                          $        200,581,782        $        156,049,541
                                                                     ===================         ===================



NET ASSETS CONSIST OF
-------------------------------------------------------------

Accumulated Undistributed Net Investment Income                     $          5,167,147        $            434,200
Net Unrealized Appreciation/(Depreciation) of Investments                         96,789                     102,341
Par Value                                                                          1,957                       1,555
Paid In Capital in Excess of Par Value                                       195,315,889                 155,511,445
                                                                     -------------------         -------------------

TOTAL NET ASSETS                                                    $        200,581,782        $        156,049,541
                                                                     ===================         ===================

Shares of Common Stock Outstanding                                               195,730                     155,512
                                                                     -------------------         -------------------

NET ASSET VALUE PER SHARE                                                      $1,024.79                  $1,003.46
                                                                               =========                  =========

</TABLE>

748419.2

<PAGE>

<TABLE>

Excelsior Private Equity Fund II, Inc.                                              Fiscal Year End:  October 31, 1998
Statement of Operations                                                                  Quarter Ended:  July 31, 1998
-----------------------------------------------------------------------------------------------------------------------
<CAPTION>
                                                                                     Fiscal      For the period from
                                                               Quarter Ended      Year To Date   October 8, 1997* to
                                                               July 31, 1998     July 31, 1998     October 31, 1997
INVESTMENT INCOME                                               (Unaudited)       (Unaudited)
<S>                                                     <C>                   <C>                   <C>

Interest Income                                          $       2,546,000     $       7,703,809     $         507,951
                                                           ---------------      ----------------      ----------------

      TOTAL INCOME                                               2,546,000             7,703,809               507,951
                                                           ---------------      ----------------      ----------------


EXPENSES

Management Investment Advisory Fees                                363,487               964,820                49,167
Administrative Fees & Shareholder Servicing Fees                    16,058                46,580                 3,805
Custodial Fees                                                      10,365                29,698                 1,967
Legal Fees                                                          24,078                58,423                10,000
Audit and Other Professional Service Fees                            7,053                19,946                20,000
Directors' Fees and Expenses                                         7,562                22,438                15,000
Shareholder Reports                                                  3,160                 5,640                 4,000
Organization Expenses                                                    0                14,811                   189
Insurance Expense                                                   14,901                44,466                 2,369
Miscellaneous Expenses                                                 152                   450                   600
                                                           ---------------      ----------------      ----------------

      TOTAL EXPENSES                                               446,816             1,207,272               107,097

Fees Waived and Reimbursed by Advisor                                   --                    --              (33,346)
                                                           ---------------      ----------------      ----------------

      NET EXPENSES                                                 446,816             1,207,272                73,751
                                                           ---------------      ----------------      ----------------

NET INVESTMENT INCOME                                            2,099,184             6,496,537               434,200
                                                           ---------------      ----------------      ----------------


UNREALIZED GAIN/( LOSS)
  ON INVESTMENTS

Net Change in Unrealized Appreciation / (Depreciation)
  on Investments                                                   106,394               (5,552)               102,341
                                                           ---------------      ----------------      ----------------

NET UNREALIZED GAIN/(LOSS)
  ON INVESTMENTS                                                   106,394               (5,552)               102,341
                                                           ---------------      ----------------      ----------------


NET INCREASE IN NET ASSETS RESULTING
  FROM OPERATIONS                                        $       2,205,578     $       6,490,985     $         536,541
                                                           ===============      ================      ================
</TABLE>

--------
*    Commencement of Operations

748419.2

<PAGE>

<TABLE>
Excelsior Private Equity Fund II, Inc.                                              Fiscal Year End:  October 31, 1998
Statement of Changes in Net Assets                                                       Quarter Ended:  July 31, 1998
-----------------------------------------------------------------------------------------------------------------------
<CAPTION>
                                                                                   Fiscal        For the period from
                                                           Quarter Ended        Year To Date     October 8, 1997* to
                                                           July 31, 1998       July 31, 1998       October 31, 1997
                                                            (Unaudited)         (Unaudited)
<S>                                                    <C>                     <C>                 <C>
OPERATIONS:

Net Investment Income                                   $          2,099,184   $       6,496,537   $           434,200
Net Change in Unrealized Appreciation / (Depreciation)
   on Investments                                                    106,394             (5,552)               102,341
                                                          ------------------    ------------------  ------------------
Net Increase in Net Assets
   Resulting From Operations                                       2,205,578           6,490,985               536,541

DISTRIBUTIONS TO SHAREHOLDERS:

From Net Investment Income                                                --         (1,763,590)                    --

CAPITAL SHARE TRANSACTIONS
Subscriptions                                                             --          40,217,000           155,512,000
Offering costs                                                            --           (412,154)                    --
                                                          ------------------     ---------------     -----------------


NET INCREASE IN NET ASSETS                                         2,205,578          44,532,241           156,048,541

NET ASSETS:
   Beginning of Period                                           198,376,204         156,049,541                 1,000
                                                          ------------------     ---------------     -----------------

   End of Period                                        $        200,581,782   $     200,581,782   $       156,049,541
                                                          ==================     ===============     =================
</TABLE>


--------
*    Commencement of Operations

748419.2

<PAGE>


Excelsior Private Equity Fund II, Inc.      Fiscal Year End:  October 31, 1998
Notes to Financial Statements                    Quarter Ended:  July 31, 1998
-------------------------------------------------------------------------------


1.    Significant Accounting Policies

         Excelsior Private Equity Fund II, Inc. (the "Company") was incorporated
      under  the  laws of the  State  of  Maryland  on  March  20,  1997  and is
      registered   under  the  Securities   Act  of  1933,  as  amended,   as  a
      non-diversified,   closed-end  management  investment  company  which  has
      elected  to  be  treated  as a  business  development  company  under  the
      Investment  Company  Act  of  1940,  as  amended.  The  Company  commenced
      operations on October 8, 1997.

         Certain information and footnote  disclosures  normally included in the
      financial  statements  prepared  in  accordance  with  generally  accepted
      accounting principles have been condensed or omitted. Reference is made to
      the  Company's  annual  report  included  in Form  10-K as filed  with the
      Securities  and  Exchange  Commission  for  the  Notes  to  the  Financial
      Statements that remain unchanged.

      The  following  is a  summary  of  the  Company's  significant  accounting
policies.

      (a)         Portfolio valuation:

         The Company  values  portfolio  securities  quarterly and at other such
      times  as,  in  the  Board  of  Directors'  view,  circumstances  warrant.
      Investments  in  unrestricted  securities  that are traded on a recognized
      stock exchange or on the national securities market are valued at the last
      sale price for such  securities on the  valuation  date.  Short-term  debt
      instruments  with  remaining  maturities  of 60 days or less are valued at
      amortized  cost,  which  approximates  market value.  Securities and other
      assets for which market  quotations are not readily  available or that are
      restricted  are valued,  pursuant to  guidelines  adopted by the  Managing
      Investment Adviser, under the supervision of the Board of Directors.

      (b)         Federal income taxes:

         It is the policy of the Company to continue to qualify as a  "regulated
      investment  company" under  Subchapter M of the Internal  Revenue Code and
      distribute  substantially  all of its taxable income to its  shareholders.
      Therefore, no federal income or excise tax provision is required.


2. Purchases and Sales of Securities:

         Purchase and sales of securities  for the three month period ended July
      31, 1998,  excluding  short-term  investments,  for the Company aggregated
      $9,573,451  and $-0-,  respectively.  At July 31,  1998,  the  Company had
      outstanding investment commitments of $12,063,462.

748419.2

<PAGE>



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

Results of Operations

THREE-MONTH PERIOD ENDED JULY 31, 1998

At July 31, 1998,  the Company's net asset value per common share was $1,024.79,
an  increase of $11.27 from net asset  value per common  share of  $1,013.52  at
April 30, 1998 resulting primarily from Net Investment Income earned.

Realized and Unrealized Gains and Losses from Portfolio Investments

For  the  three  months  ended  July  31,  1998,  the  Company  had no  realized
gain/(loss)  from  investments.  For the three months  ended July 31, 1998,  the
Company had a $106,394 net change in unrealized appreciation/(depreciation) from
investments.

Investment Income and Expenses

For the three  months ended July 31,  1998,  the Company had interest  income of
$2,546,000 and net operating  expenses of $446,816,  resulting in net investment
income of  $2,099,184.  July 31,  1998 is the  Company's  third full  quarter of
operation.

The   Managing   Investment   Adviser   provides   investment   management   and
administrative   services  required  for  the  operation  of  the  Company.   In
consideration of the services rendered by the Managing Investment  Adviser,  the
Company pays a management  fee based upon a percentage  of the net assets of the
Company invested or committed to be invested in certain types of investments and
an incentive fee based in part on a percentage of realized  capital gains of the
Company.  Such fee is determined  and payable  quarterly.  For the quarter ended
July 31, 1998, the Managing  Investment  Adviser  earned  $363,487 in management
fees.  The  Managing  Investment  Adviser  has  voluntarily  agreed  to waive or
reimburse  operating expenses of the Fund,  exclusive of management fees, to the
extent they exceed  0.25% of the Fund's net assets.  For the quarter  ended July
31, 1998, no such reimbursement was made.

Net Assets

At July 31, 1998,  the  Company's net assets were  $200,581,782,  an increase of
$2,205,578 from net assets of $198,376,204 at April 30, 1998.

Liquidity and Capital Resources

The  Company  focuses  its  investments  in the  private  equity  securities  of
later-stage  venture  capital  companies and  middle-market  companies which the
Company believes offer significant long-term capital  appreciation.  The Company
may offer  managerial  assistance  to certain of these  companies.  The  Company
invests its available cash in short-term investments of marketable securities to
provide the  liquidity  necessary to make  portfolio  investments  as investment
opportunities arise.

During  the  quarter  ended July 31,  1998,  the  Company  made  investments  in
Advantage Schools,  Inc., a for-profit operator of charter schools,  and Release
Software Corp., a provider of Internet-based  electronic  software  distribution
services.  The  Company  also  made an $8  million  commitment  to  Morganthaler
Ventures V and a $3 million commitment to Advanced Technology Ventures V.

At July 31,  1998,  the Company  held  $6,999,842  in cash and  $192,878,262  in
investments.  At July 31, 1998,  investments  included  $27,190,773 in portfolio
companies,  $3,041,807  in private  funds,  $124,921,566  in  commercial  paper,
$11,303,205  in  corporate  bonds,  $20,002,564  in U.S.  Government  and agency
obligations,  and $6,418,347 in investment  companies.  At October 31, 1997, the
Company held $63 in cash and  $155,610,242 in investments.  At October 31, 1997,
investments included  $119,559,143 in commercial paper,  $6,073,060 in corporate
bonds, $21,732,259 in U.S. Government and

748419.2

<PAGE>



agency obligations and $8,245,780 in other short-term investments. These changes
were primarily the result of the investment activity discussed above.

Other

In 1996, the Managing  Investment Adviser established a Year 2000 Committee with
responsibility  for  developing an effective plan for  identifying,  renovating,
testing  and  implementing  solutions  for Year 2000  processing.  The  Managing
Investment  Adviser is working with Chase Global Fund Services (as administrator
to the Company and as provider of certain of the Managing  Investment  Adviser's
most significant data processing  systems),  as well as other vendors, to ensure
compliance  with  required  systems  changes.  The Managing  Investment  Adviser
presently  believes that with modifications to existing software and compliance,
by vendors who provide significant processing systems to the Managing Investment
Adviser,  the  Managing  Investment  Adviser's  systems  will  continue  without
disruption.  However,  if such  modifications are not made, or are not completed
timely,  the Year 2000 issue could have a material  impact on the  operations of
the Managing Investment Adviser, and consequently, the Company. Specific factors
that might  cause such a material  impact  include,  but are not  limited to the
availability  and cost of personnel  trained in this area, the ability to locate
and correct all relevant computer codes and similar uncertainties.  The Managing
Investment  Adviser's Year 2000 plan  anticipates that software code remediation
and testing of all critical systems will be  substantively  completed by the end
of 1998. The Managing  Investment  Advisers's  total Year 2000 project costs and
its  estimated  time  frame  to  complete  are  based  on  presently   available
information.  However,  there  can be no  guarantee  that the  systems  of other
companies,  on which the Managing  Investment  Adviser's  systems rely,  will be
converted timely, or that a failure to convert by another company would not have
a material adverse effect on the Managing Investment Adviser or the Company.



Item 3.        Quantitative and Qualitative Disclosure About Market Risk.

               Not Applicable.



PART II.       OTHER INFORMATION

Item 1.        Legal Proceedings.

               There are no legal proceedings  pending or, to the Company's best
               knowledge, threatened against the Company.



Item 2.        Changes in Securities.

               None.



Item 3.      Defaults upon Senior Securities.

             None.



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

             None.



Item 5.      Other Information.

748419.2

<PAGE>



             Not applicable.



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

             (a)  Exhibits.

                  Exhibit No.

                  (27) Financial Date Schedule (for EDGAR filing purposes only).



             (a) The following reports on Form 8-K were filed during the quarter
ended July 31, 1998:

                  None.



748419.2

<PAGE>

                                   SIGNATURES



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



                                          EXCELSIOR PRIVATE EQUITY FUND II, INC.


Date:      September 9, 1998        ____________________________________________
                                By: David I. Fann
                                    President and Principal Executive Officer


Date:      September 9, 1998         ___________________________________________
                                By:  Brian F. Schmidt
                                     Chief Financial Officer




748419.2

<PAGE>


                              CONFORMED SIGNATURES



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

                                          EXCELSIOR PRIVATE EQUITY FUND II, INC.


Date:      September 9,  1998      /s/ David J. Fann
                                   ---------------------------------------------
                                By: David I. Fann
                                    President and Principal Executive Officer


Date:      September 9, 1998      /s/ Brian F. Schmidt
                                  ----------------------------------------------
                                By:  Brian F. Schmidt
                                     Chief Financial Officer


748419.2