UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D. C. 20549

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

                                    FORM 10-Q

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

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


For Quarter Ended March 31, 1999          Commission File Number 0-20378

                              CENIT BANCORP, INC. 
             (Exact name of registrant as specified in its charter)

               Delaware                              54-1592546               
(State or other jurisdiction of           (I.R.S. Employer Identification
 incorporation or organization)                        Number)

       225 West Olney Road
          Norfolk, Virginia                            23510                    
(Address of principal executive                     (Zip code)
      office)

     Registrant's telephone number, including area code:  (757) 446-6600

     Indicate  by check mark  whether the  registrant  (1) has filed all reports
     required to be filed by Section 13 or 15(d) of the Securities  Exchange Act
     of 1934 during the preceding 12 months (or for such shorter period that the
     registrant was required to file such reports),  and (2) has been subject to
     such filing requirements for the past 90 days.

                      YES   X                           NO      

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


Common Stock $.01 Par Value                           4,798,780            
       Title of Class                        Number of Shares Outstanding
                                                  as of May 10, 1999

<PAGE>

                      CENIT BANCORP, INC. AND SUBSIDIARIES

                                    Contents
-------------------------------------------------------------------------------


                                                                           Page
                                                                           ----
PART I - FINANCIAL INFORMATION

Item 1
   Financial Statements

Consolidated Statement of Financial Condition as of March 31, 1999 
(Unaudited)and December 31, 1998............................................. 1

Unaudited Consolidated Statement of Operations for the Three Months
Ended March 31, 1999 and March 31, 1998...................................... 2

Unaudited Consolidated Statement of Comprehensive Income for the Three
Months Ended March 31, 1999 and March 31, 1998............................... 3

Unaudited Consolidated Statement of Changes in Stockholders' Equity for the 
Three Months ended March 31, 1999............................................ 4

Unaudited Consolidated Statement of Cash Flows for the Three Months Ended 
March 31, 1999 and March 31, 1998............................................ 5

Notes to Unaudited Consolidated Financial Statements......................... 6

Item 2
     Management's  Discussion and Analysis of Financial Condition and Results 
of Operations................................................................ 7

Item 3
   Quantitative and Qualitative Disclosures about Market Risk................18

PART II - OTHER INFORMATION

Item 1
   Legal Proceedings.........................................................18

Item 2
   Changes in Securities.....................................................18

Item 3
   Defaults Upon Senior Securities...........................................18

Item 4
   Submission of Matters to a Vote of Security Holders.......................18

Item 5
   Other Information.........................................................18

Item 6
   Exhibits and Reports on Form 8-K..........................................18

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

<PAGE>

PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements

                      CENIT BANCORP, INC. AND SUBSIDIARIES
                  CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
                  (Dollars in thousands, except per share data)

                                     ASSETS
<TABLE>
<CAPTION>

                                                                             (Unaudited)
                                                                           March 31, 1999       December 31, 1998
                                                                           --------------       -----------------
<S>                                                                           <C>                   <C>
Cash                                                                          $  20,304             $  14,656
Federal funds sold                                                               21,900                42,289
Securities available for sale at fair value (adjusted
   cost of $69,172 and $64,327, respectively)                                    69,658                65,136
Loans, net:
   Held for investment                                                          492,263               484,783
   Held for sale                                                                  2,717                 3,878
Interest receivable                                                               4,013                 3,723
Real estate owned, net                                                              392                   377
Federal Home Loan Bank stock, at cost                                             4,250                 5,066
Property and equipment, net                                                      12,916                13,002
Goodwill and other intangibles, net                                               3,558                 3,647
Other assets                                                                      3,726                 4,499
                                                                              ---------             ---------
                                                                              $ 635,697             $ 641,056
                                                                              =========             =========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:
   Deposits:
     Noninterest-bearing                                                      $  73,597             $  78,712
     Interest-bearing                                                           416,632               418,060
                                                                              ---------             ---------
        Total deposits                                                          490,229               496,772
   Advances from the Federal Home Loan Bank                                      75,000                75,000
   Securities sold under agreements to repurchase                                16,187                13,084
   Advance payments by borrowers for taxes and insurance                          1,080                   599
   Other liabilities                                                              3,502                 5,525
                                                                              ---------             ---------
        Total liabilities                                                       585,998               590,980
                                                                              ---------             ---------
Stockholders' equity:
   Preferred stock, $.01 par value; authorized 3,000,000
     shares; none outstanding                                                         -                     -
   Common stock, $.01 par value; authorized 7,000,000 shares;
     issued and outstanding 4,791,940 and 4,808,806 shares,
     respectively                                                                    48                    48
   Additional paid-in capital                                                    13,837                14,177
   Retained earnings - substantially restricted                                  39,696                39,600
   Common stock acquired by Employee Stock Ownership Plan (ESOP)                 (4,006)               (4,052)
   Common stock acquired by Management Recognition
     Plan (MRP)                                                                    (177)                 (199)
   Accumulated other comprehensive income,
     net of income taxes                                                            301                   502
                                                                              ---------             ---------
     Total stockholders' equity                                                  49,699                50,076
                                                                              ---------             ---------
                                                                              $ 635,697             $ 641,056
                                                                              =========             =========

<FN>

The notes to unaudited consolidated financial statements are an integral part of this statement.
</FN>
</TABLE>

                                        1
<PAGE>

                      CENIT BANCORP, INC. AND SUBSIDIARIES

                 UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS
                  (Dollars in thousands, except per share data)
<TABLE>
<CAPTION>
                                                                                               Three Months
                                                                                                   Ended
                                                                                                March 31,
                                                                                         1999             1998
                                                                                         ----             ----
<S>                                                                                   <C>               <C>
Interest and fees on loans                                                            $   9,445         $ 10,050
Interest on mortgage-backed certificates                                                    273            1,483
Interest on investment securities                                                           770              684
Dividends and other interest income                                                         239              347
                                                                                       --------         --------   
   Total interest income                                                                 10,727           12,564
                                                                                       --------         --------   
Interest on deposits                                                                      4,198            5,102
Interest on borrowings                                                                    1,182            2,075
                                                                                       --------         --------   
   Total interest expense                                                                 5,380            7,177
                                                                                       --------         --------   
   Net interest income                                                                    5,347            5,387
Provision for loan losses                                                                    14              204
                                                                                       --------         --------   
   Net interest income after provision for loan losses                                    5,333            5,183
                                                                                       --------         --------   
Other income:
   Deposit fees                                                                             659              603
   Merchant processing fees                                                                 514              393
   Commercial mortgage brokerage fees                                                       158              181
   Gains on sales of loans and securities, net                                              240              175
   Other                                                                                    260              213
                                                                                       --------         --------   
     Total other income                                                                   1,831            1,565
                                                                                       --------         --------   

Other expenses:
   Salaries and employee benefits                                                         2,436            2,088
   Equipment, data processing and supplies                                                  747              704
   Net occupancy expense of premises                                                        526              473
   Merchant processing                                                                      429              361
   Professional fees                                                                        174              194
   Other                                                                                    563              678
                                                                                       --------         --------   
     Total other expenses                                                                 4,875            4,498
                                                                                       --------         --------   

Income before income taxes                                                                2,289            2,250
Provision for income taxes                                                                  824              793
                                                                                       --------         --------   
   Net income                                                                         $   1,465         $  1,457
                                                                                       ========         ========   

Earnings per  share:
   Basic                                                                              $     .32         $    .31
                                                                                       ========         ========   
   Diluted                                                                            $     .31         $    .30
                                                                                       ========         ========   
Dividends per common share                                                            $     .15         $    .10
                                                                                       ========         ========


<FN>
The notes to unaudited consolidated financial statements are an integral part of this statement.
</FN>
</TABLE>

                                        2
<PAGE>

                      CENIT BANCORP, INC. AND SUBSIDIARIES

            UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
                             (Dollars in thousands)


<TABLE>
<CAPTION>

                                                                                               Three Months
                                                                                                   Ended
                                                                                                March 31,
                                                                                         1999             1998
                                                                                         ----             ----

<S>                                                                                    <C>               <C>
Net income                                                                             $  1,465          $ 1,457
                                                                                       --------          -------

Other comprehensive loss, before income taxes:
   Unrealized losses on securities available for sale
     Unrealized holding losses arising during the period                                   (323)            (189)
     Less: reclassification adjustment for gains included in net income                       -              (31)
                                                                                       --------          -------

Other comprehensive loss, before income taxes                                              (323)            (220)

Income tax benefit related to items of other comprehensive loss                             122               77
                                                                                       --------          -------

Other comprehensive loss, net of income taxes                                              (201)            (143)
                                                                                       --------          -------

Comprehensive income                                                                   $  1,264          $ 1,314
                                                                                       ========          =======

<FN>
The notes to unaudited consolidated financial statements are an integral part of this statement.
</FN>
</TABLE>

                                        3
<PAGE>

                      CENIT BANCORP, INC. AND SUBSIDIARIES

       UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
                        Three Months Ended March 31, 1999
                             (Dollars in thousands)



<TABLE>
<CAPTION>

                                                                                         Common
                                                                                         Stock      Accumulated Other
                                     Common       Common      Additional                Acquired      Comprehensive
                                      Stock        Stock       Paid-In     Retained     by ESOP      Income, Net of
                                     Shares       Amount       Capital     Earnings      and MRP      Income Taxes        Total
                                     ------       ------       -------     --------     ---------    ---------------      ----- 

<S>                               <C>              <C>        <C>          <C>          <C>            <C>             <C>
Balance, December 31, 1998        4,808,806        $ 48       $14,177      $39,600      $(4,251)       $   502         $ 50,076


Comprehensive income                      -           -             -        1,465           -            (201)           1,264


Cash dividends declared                   -           -             -       (1,369)          -               -           (1,369)


Exercise of stock options and
   related tax benefits               1,464           -            17            -           -               -               17


Stock repurchases                   (18,330)          -          (373)           -           -               -             (373)


Other                                     -           -            16            -          68               -               84
                                    ---------       ---        ------       ------      -------        -------          -------


Balance, March 31, 1999             4,791,940      $ 48       $13,837      $39,696      $(4,183)       $   301         $ 49,699
                                    =========       ===        ======       ======      =======        =======          =======



<FN>
The notes to unaudited consolidated financial statements are an integral part of this statement.
</FN>
</TABLE>

                                        4
<PAGE>

                      CENIT BANCORP, INC. AND SUBSIDIARIES

                 UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS
                             (Dollars in thousands)

<TABLE>
<CAPTION>
                                                                         Three months ended March 31,
                                                                         ----------------------------
                                                                         1999                   1998
                                                                         ----                   ----
<S>                                                                       <C>                <C>
Cash flows from operating activities:
   Net income                                                             $  1,465           $  1,457
   Add (deduct) items not affecting cash in the period:
     Provision for loan losses                                                  14                204
     Provision for losses on real estate owned                                   -                 14
     Amortization of loan yield adjustments                                    178                100
     Depreciation, amortization and accretion, net                             432                578
     Net (gains) losses on sales/disposals of:
        Securities                                                               -                (31)
        Loans                                                                 (240)              (144)
        Real estate, property and equipment                                    (45)                46
     Proceeds from sales of loans held for sale                             17,340             12,945
     Originations of loans held for sale                                   (15,943)           (13.636)
     Change in assets/liabilities:
        Net (increase) decrease in interest receivable and other assets        534               (251)
        Net increase (decrease) in other liabilities                        (2,512)               651
                                                                           -------            -------
        Net cash provided by operating activities                            1,223              1,933
                                                                           -------            -------
Cash flows from investing activities:
   Purchases of securities available for sale                              (11,136)           (32,903)
   Proceeds from sales of securities available for sale                          -             17,768
   Principal repayments on securities available for sale                     2,279              9,984
   Proceeds from maturities of securities available for sale                 4,000              4,000
   Net increase in loans held for investment                                (7,748)           (33,391)
   Net proceeds on sales of real estate owned                                   57                161
   Purchases of Federal Home Loan Bank stock                                     -             (1,650)
   Redemption of Federal Home Loan Bank stock                                  816                150
   Purchases of property and equipment                                        (225)              (392)
                                                                           -------            -------
     Net cash used for investing activities                                (11,957)           (36,273)
                                                                           -------            -------
Cash flows from financing activities:
   Proceeds from exercise of stock options and warrants                          9                 36
   Net increase (decrease) in deposits                                      (6,543)             1,775
   Proceeds from Federal Home Loan Bank advances                                 -            267,000
   Repayment of Federal Home Loan Bank advances                                  -           (254,000)
   Repayments of other borrowings                                                -               (714)
   Common stock repurchases                                                   (373)                 -
   Net increase in securities sold under agreement
     to repurchase                                                           3,103                114
   Cash dividends paid                                                        (684)              (473)
   Other, net                                                                  481                646
                                                                           -------            -------
        Net cash provided by (used for) financing activities                (4,007)            14,384
                                                                           -------            -------
Decrease in cash and cash equivalents                                      (14,741)           (19,956)
Cash and cash equivalents, beginning of period                              56,945             54,111
                                                                           -------            -------
Cash and cash equivalents, end of period                                 $  42,204           $ 34,155
                                                                           =======            =======
Supplemental disclosures of cash flow  information:
     Cash paid during the period for interest                            $   1,660           $  2,704
     Cash paid during the period for income taxes                              127                  -
   Schedule of noncash investing and financing activities:
     Real estate acquired in settlement of loans                         $      76           $    105
     Loans to facilitate sale of real estate owned                               -                258


<FN>
The notes to unaudited consolidated financial statements are an integral part of this statement.
</FN>
</TABLE>

                                        5
<PAGE>

                      CENIT BANCORP, INC. AND SUBSIDIARIES

              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------------------------------------------


Note 1 - Basis of Presentation

     The  accompanying  unaudited  consolidated  financial  statements have been
prepared in accordance with the instructions to Form 10-Q and, therefore, do not
include  all of  the  disclosures  and  notes  required  by  generally  accepted
accounting  principles.  In the  opinion  of  the  management,  all  adjustments
(consisting  of  normal  recurring  accruals)  considered  necessary  for a fair
presentation  have been included.  The results of operations for the three month
periods ended March 31, 1999 and 1998 are not necessarily  indicative of results
that  may be  expected  for the  entire  year or any  interim  periods.  Certain
previously  reported  amounts have been  reclassified  to agree with the current
presentation.  The interim  financial  statements  should be read in conjunction
with the December 31,  1998 consolidated  financial statements of CENIT Bancorp,
Inc. (the "Company").

Note 2 - Per Share Data

     Basic  earnings  per share is  calculated  using  weighted  average  shares
outstanding.  For the three month period ended March 31, 1999,  weighted average
shares used to compute basic  earnings per share were  4,566,074.  For the three
months  ended March 31,  1998,  weighted  average  shares used to compute  basic
earnings per share were 4,729,096.

     Diluted earnings per share is calculated by adding common stock equivalents
to the weighted  average  shares  outstanding.  For the three month period ended
March 31, 1999,  weighted  average shares used to compute  diluted  earnings per
share were  4,654,449.  For the three  months  ended  March 31,  1997,  weighted
average shares used to compute diluted earnings per share were 4,868,040.








                                        6
<PAGE>

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

General

     The  Company's  business  currently  consists  of the  business of its sole
subsidiary, CENIT Bank (the "Bank"). The principal business of the Bank consists
of attracting retail deposits from the general public in its market area through
a variety of deposit  products and  investing  these funds in  commercial,  real
estate  and  consumer   loans.   The  Bank  also   invests  in   mortgage-backed
certificates,  securities  issued  by the  U.S.  Treasury  and  U.S.  Government
agencies,   federal  funds  sold,  Federal  Home  Loan  Bank  stock,  and  other
investments permitted by applicable laws and regulations.

Financial Condition Of The Company

Total Assets

     At March 31, 1999, the Company had total assets of $635.7 million  compared
to $641.1 million at December 31, 1998.

Securities Available for Sale

     Securities  available  for sale totaled $69.7 million at March 31, 1999 and
are comprised of U. S. Treasury and other U. S.  Government  Agency  securities,
mortgage-backed  certificates,  and other debt  securities.  The net increase of
$4.6  million  or 6.9% from the  December  31,  1998  balance  of $65.1  million
resulted  primarily  from  $11.1  million in  purchases  of  available  for sale
securities,  partially offset by $4.0 million in proceeds from  maturities,  and
$2.3 million in principal repayments.

Loans

     The balance of net loans held for investment  increased from $484.8 million
at December 31, 1998 to $492.3  million at March 31,  1999,  an increase of $7.5
million or 1.5%.  This  increase is  primarily  due to an increase in fixed rate
single-family mortgages of $14.6 million, offset by an $11.8 million decrease in
adjustable  rate  single-family  mortgages.  The  Company's  core banking  loans
(multi-family,  commercial  real  estate,  construction,  land  acquisition  and
development,  commercial  business and consumer  loans)  increased  2.0% or $4.7
million from  December  31, 1998 to March 31,  1999.  For the three months ended
March 31, 1999,  loan  originations  totaled $54.1  million  and  loan purchases
totaled  $23.7  million,  of which $22.5  million was a bulk purchase of 15 year
fixed-rate residential loans. Total principal reductions totaled $72.2 million.


                                        7
<PAGE>

     The following  table sets forth the  composition of the Company's  loans in
dollar  amounts and as a percentage of the Company's  total gross loans held for
investment at the dates indicated.
<TABLE>
<CAPTION>

                                                            March 31, 1999                 December 31, 1998
                                                            --------------                 -----------------
                                                                        (Dollars in Thousands)
                                                       Amount        Percent              Amount        Percent
                                                       ------        -------              ------        -------
<S>                                                   <C>              <C>              <C>               <C>

Real estate loans:
   Residential permanent 1- to 4-family:
     Adjustable rate                                  $ 169,258        31.96%           $  181,104        34.63%
     Fixed rate
       Conventional                                      80,922        15.28                66,041        12.63
       Guaranteed by VA or insured by FHA                 3,685          .70                 3,972          .76
                                                       --------        -----             ---------        -----
     Total permanent 1- to 4-family                     253,865        47.94               251,117        48.02
   Residential permanent 5 or more family                 7,597         1.43                 7,874         1.51
                                                       --------        -----             ---------        -----

     Total permanent residential loans                  261,462        49.37               258,991        49.53
                                                       --------        -----             ---------        -----

   Commercial real estate loans:
     Hotels                                               9,201         1.74                 9,208         1.76
     Office and warehouse facilities                     37,898         7.16                36,659         7.01
     Retail facilities                                   23,251         4.39                22,823         4.37
     Other                                                8,301         1.57                 7,921         1.51
                                                       --------        -----             ---------        -----
     Total commercial real estate loans                  78,651        14.86                76,611        14.65
                                                       --------        -----             ---------        -----

   Construction loans:
     Residential 1- to 4-family                          49,503         9.35                47,232         9.03
     Residential 5 or more family                        13,692         2.58                19,621         3.75
     Nonresidential                                       4,337          .82                 4,101          .79
                                                       --------        -----             ---------        -----
     Total construction loans                            67,532        12.75                70,954        13.57
                                                       --------        -----             ---------        -----


   Land acquisition and development loans:
     Consumer lots                                        3,569          .67                 3,703          .71
     Acquisition and development                         13,390         2.53                11,444         2.19
                                                       --------        -----             ---------        -----

     Total land acquisition and development
       loans                                             16,959         3.20                15,147         2.90
                                                       --------        -----             ---------        -----

     Total real estate loans                            424,604        80.18               421,703        80.65
                                                       --------        -----             ---------        -----
Consumer loans:
   Boats                                                  3,979          .75                 4,275          .82
   Home equity and second mortgage                       52,229         9.86                52,845        10.11
   Other                                                 10,470         1.98                10,589         2.02
                                                       --------        -----             ---------        -----
     Total consumer loans                                66,678        12.59                67,709        12.95
                                                       --------        -----             ---------        -----
Commercial business loans                                38,314         7.23                33,485         6.40
                                                       --------        -----             ---------        -----
     Total loans                                        529,596       100.00%              522,897       100.00%
                                                       --------        =====             ---------        =====

Less:
   Allowance for loan losses                              3,944                              4,024
   Loans in process                                      34,744                             35,463
   Unearned discounts, premiums, and loan fees, net      (1,355)                            (1,373)
                                                       --------                          --------- 
                                                         37,333                             38,114
                                                       --------                          --------- 
Total loans, net                                      $ 492,263                         $  484,783
                                                       ========                          ========= 

</TABLE>



                                        8
<PAGE>

     The following table sets forth information about  originations,  purchases,
sales,  and  principal  reductions  for  the  Company's  loans  for  the  period
indicated.

                                                            Three Months Ended
                                                              March 31, 1999
                                                          ---------------------
                                                          (Dollars in Thousands)
Loans originated:
   Real estate:
      Permanent:
         Residential 1- to 4-family                             $  19,146
         Residential 5 or more family                                   -
                                                                ---------
            Total                                                  19,146
                                                                ---------
      Commercial real estate                                        3,883
                                                                ---------

       Construction:
         Residential 1- to 4-family                                 3,429
         Residential 5 or more family                                   -
         Nonresidential                                               819
                                                                ---------
            Total                                                   4,248
                                                                ---------
      Land acquisition:
         Consumer lots                                                266
         Acquisition and development                                3,497
                                                                ---------
            otal                                                   3,763
                                                                ---------
            Total real estate loans originated                     31,040
                                                                ---------
   Consumer:
      Home equity and second mortgage                               8,063
      Other                                                         2,085
                                                                ---------
            Total                                                  10,148
                                                                ---------
   Commercial business                                             12,874
                                                                ---------
            Total loans originated                                 54,062
                                                                ---------
   Loans purchased                                                 23,668
                                                                ---------
            Total loans originated and purchased                   77,730
                                                                ---------
Principal reductions:
   Repayments and other principal reductions                       55,462
   Real estate loans sold                                          16,713
                                                                ---------
            Total principal reductions                             72,175
                                                                ---------
Net increase in total loans                                     $   5,555
                                                                =========
Net decrease in gross loans held for sale                       $  (1,144)
Net increase in gross loans held for investment                     6,699
                                                                ---------
                                                                $   5,555
                                                                =========


                                        9
<PAGE>

Deposits

     The balance of deposits  decreased $6.5 million or 1.3% from $496.8 million
at  December  31,  1998 to $490.2  million at March 31,  1999.  Certificates  of
deposits  and  noninterest-bearing  deposits  decreased  $5.4  million  and $5.1
million,  respectively,  from December 31, 1998 to March 31, 1999. This decrease
was  partially  offset  by an  increase  of  $4.0  million  in  interest-bearing
checking, savings and money market deposits.

Capital

     The Bank's capital ratios exceeded  applicable  regulatory  requirements at
March 31, 1999.

     In June 1998,  the Board of  Directors  of the Company  gave the  Company's
management the  discretion to repurchase up to five percent (or 249,830  shares)
of the  Company's  shares.  As of December  31,  1998,  the Company  repurchased
231,500 shares. The remaining 18,330 shares were repurchased in January 1999.

Asset Quality

     Nonperforming Assets.  Nonperforming assets consist of nonperforming loans,
real estate  acquired in  settlement  of loans  ("REO"),  and other  repossessed
assets. Generally the Company does not accrue interest on loans that are 90 days
or more past due,  with the  exception of certain  VA-guaranteed  or FHA insured
one- to four-family  permanent  mortgage loans,  certain credit card loans,  and
matured loans for which the borrowers are still making required monthly payments
of interest,  or principal and  interest,  and with respect to which the Bank is
negotiating extensions or refinancings with the borrowers.


                                       10
<PAGE>

     The   following   table  sets  forth   information   about  the   Company's
nonperforming loans, REO, and other repossessed assets at the dates indicated.

<TABLE>
<CAPTION>

                                                                          March 31,                December 31,
                                                                            1999                       1998
                                                                          ---------                ------------
                                                                                  (Dollars in Thousands)
   
<S>                                                                      <C>                        <C>
Nonperforming loans:
   Real estate loans:
     Permanent residential 1- to 4-family
       Nonaccrual                                                        $  429                     $   359
       Accruing loans 90 days or more past due                              562                         511
                                                                         ------                     -------
         Total                                                              991                         870
                                                                         ------                     -------

   Consumer loans:
     Boats  (nonaccrual)                                                     29                          37
     Home equity and second mortgage (nonaccrual)                            57                          57
     Credit cards (accruing loans 90 days or
       more past due)                                                         -                           2
     Other (nonaccrual)                                                      40                          46
                                                                         ------                     -------
       Total                                                                126                         142
                                                                         ------                     -------
   Commercial business loans:
     Nonaccrual                                                             107                          64
     Accruing loans 90 days or more past due                                  -                           -
                                                                         ------                     -------
       Total                                                                107                          64
                                                                         ------                     -------

Total nonperforming loans:
   Nonaccrual                                                               662                         563
   Accruing loans 90 or more days past due                                  562                         513
                                                                         ------                     -------
       Total                                                              1,224                       1,076
Real estate owned, net                                                      392                         377
Other repossessed assets, net                                                13                          21
                                                                         ------                     -------
   Total nonperforming assets, net                                       $1,629                     $ 1,474
                                                                         ======                     =======

   Total nonperforming assets, net, to total assets                         .26%                        .23%
                                                                         ======                     =======
</TABLE>



                                       11
<PAGE>

     Allowance for Loan Losses.  The following  table sets forth activity of the
allowance for loan losses for the periods indicated.
                                                  Three months ended March 31,
                                                  ----------------------------
                                                 1999                     1998
                                                 ----                     ----
                                                     (Dollars in Thousands)

Balance at beginning of period                 $ 4,024                  $ 3,783
Provision for loan losses                           14                      204
Losses charged to allowance                       (108)                    (233)
Recovery of prior losses                            14                       44
                                               -------                  -------
Balance at end of period                       $ 3,944                  $ 3,798
                                               =======                  =======

     The Company's  provision for loan losses decreased to $14,000 for the three
months ended March 31, 1999 as compared to $204,000 for the same period in 1998.
At March 31, 1999,  the  Company's  coverage  ratio of  nonperforming  loans was
322.2% based on a total allowance of $3,944,000 and total nonperforming loans of
$1,224,000.  This  compares  to a  coverage  ratio of 217.9% at March 31,  1998.
During the first quarter of 1999,  net loan  charge-offs  exceeded the loan loss
provision by $80,000.  This $80,000 difference  consists of charge-offs of types
of loans in which the Bank is no longer active and for which provisions for loan
losses have been made previously which management believes to be adequate.

Average Balance Sheets

     The  following  tables set forth,  for the periods  indicated,  information
regarding: (i) the total dollar amounts of interest income from interest-earning
assets  and the  resulting  average  yields;  (ii) the total  dollar  amounts of
interest  expense from  interest-bearing  liabilities and the resulting  average
costs;  (iii) net interest income;  (iv) interest rate spread;  (v) net interest
position;  (vi) the net yield earned on  interest-earning  assets; and (vii) the
ratio of total  interest-earning  assets to total interest- bearing liabilities.
Average  balances shown in the following tables have been calculated using daily
average balances.



                                       12
<PAGE>
<TABLE>
<CAPTION>

                                                        For the Three Months             For the Three Months
                                                                Ended                            Ended
                                                           March 31, 1999                      March 31, 1998
                                                    ----------------------------     ----------------------------           
                                                    Average               Yield/     Average               Yield/
                                                    Balance   Interest     Cost      Balance   Interest     Cost
                                                    -------   --------    ------     -------   --------    ------
                                                                        (Dollars in thousands)
<S>                                                <C>         <C>           <C>    <C>         <C>           <C>
Interest-earning assets:
    Loans (1)                                      $  500,197  $  9,445      7.55%  $  504,791  $ 10,050      7.96%
    Mortgage-backed certificates                       14,572       273      7.49       87,980     1,483      6.74
    Investment securities                              52,883       770      5.82       45,001       684      6.08
    Federal funds sold                                 12,469       146      4.68       13,171       180      5.47
    Federal Home Loan Bank and
       Federal Reserve Bank stock                       5,011        93      7.42        9,400       167      7.11
                                                    ---------    ------              ---------    ------
       Total interest-earning assets                  585,132    10,727      7.33      660,343    12,564      7.61
                                                    ---------    ------              ---------    ------


Noninterest-earning assets:
    Real estate owned, net                                386                            1,023
    Other                                              37,777                           42,263
                                                    ---------                        ---------
       Total noninterest-earning assets                38,163                           43,286
                                                    ---------                        ---------
         Total assets                              $  623,295                       $  703,629
                                                    =========                        =========

Interest-bearing liabilities:
    Passbook and statement savings                 $   35,989  $    218      2.42   $   43,152  $    353      3.27
    Checking accounts                                  37,833       134      1.42       31,891       147      1.84
    Money market deposit accounts                      74,802       626      3.35       55,676       500      3.59
    Certificates of deposit                           258,414     3,220      4.98      315,145     4,102      5.21
                                                    ---------     ------             ---------    ------
       Total interest-bearing deposits                407,038     4,198      4.13      445,864     5,102      4.58
                                                    ---------     ------             ---------    ------
    Advances from the Federal Home
       Loan Bank                                       81,500     1,037      5.09      141,700     1,925      5.43
    Securities sold under agreements
       to repurchase                                   15,208       145      3.81        9,228       104      4.51
    Other borrowings                                        -         -         -        2,424        46      7.59
                                                    ---------     ------             ---------    ------
       Total borrowings                                96,708     1,182      4.89      153,352     2,075      5.41
                                                    ---------     ------             ---------    ------
       Total interest-bearing liabilities             503,746     5,380      4.27      599,216     7,177      4.79
                                                    ---------     ------             ---------    ------

Noninterest-bearing liabilities:
    Deposits                                           64,187                           47,923
    Other liabilities                                   5,610                            6,222
                                                    ---------                        ---------
       Total noninterest-bearing liabilities           69,797                           54,145
                                                    ---------                        ---------
         Total liabilities                            573,543                          653,361
                                                    ---------                        ---------

Stockholders' equity                                   49,752                           50,268
                                                    ---------                        ---------
Total liabilities and stockholders' equity         $  623,295                       $  703,629
                                                    =========                        =========

Net interest income/interest rate spread                       $  5,347      3.06%              $  5,387      2.82%
                                                               ========                         ========
Net interest position/net interest margin          $   81,386                3.66%  $   61,127                3.26%
                                                    =========                        =========

Ratio of average interest-earning assets to
    average interest-bearing liabilities               116.16%                          110.20%
                                                       ======                           ======
<FN>
(1) Includes nonaccrual loans and loans held for sale.
</FN>
</TABLE>

                                       13
<PAGE>

Comparison  of  Operating  Results for the Three Months Ended March 31, 1999 and
March 31, 1998.

General

     The Company's $2.3 million pre-tax income remained  unchanged for the three
months  ended March 31, 1999  compared to the same period in the prior year.  An
increase in other  income of $266,000 and a decrease in the  provision  for loan
losses of $190,000  were offset by a decrease in net interest  income of $40,000
and an increase of $377,000 in other expenses.

Net Interest Income

     The Company's net interest income before provision for loan losses remained
substantially  the same for the quarter ended March 31, 1999 as compared to that
of the previous year. A $1.8 million decrease in interest income was offset by a
$1.8  million  decrease  in interest  expense  for the first  quarter of 1999 as
compared to the same period in 1998. As a result of changes in the interest rate
environment in 1998,  management  used the proceeds from the sale,  maturity and
principal   repayment   of   certain   securities,   primarily   mortgage-backed
certificates, to reduce advances from the Federal Home Loan Bank ("FHLB") rather
than seek  alternative  investment  opportunities.  This  strategy  reduced both
interest  earning  assets  and  interest  bearing  liabilities  during the first
quarter of 1999  compared to the first quarter of 1998.  Total  interest-earning
assets  decreased  from an average of $660.3 million during the first quarter of
1998  to  $585.1  million  during  the  first  quarter  of  1999,   while  total
interest-bearing  liabilities  decreased  from $599.2  million  during the first
quarter of 1998 to $503.7  during the first  quarter of 1999.  As a result,  the
Company's net interest  margin  increased from 3.26% for the quarter ended March
31, 1998 to 3.66% for the quarter ended March 31, 1999.

     Interest  on  the  Company's  portfolio  of  mortgage-backed   certificates
decreased by $1.2 million from $1.5 million for the quarter ended March 31, 1998
to $274,000 for the comparable 1999 period.  The decrease was  attributable to a
$73.4 million  decrease in the average balance of the portfolio during the first
quarter of 1999  compared  to the first  quarter of 1998.  The  decrease  in the
portfolio  average  balance was  primarily due to the sales and  prepayments  of
mortgage-backed securities as a result of the interest rate declines in 1998.

     Interest on loans decreased by $605,000 in the quarter ended March 31, 1999
compared to the same period in 1998.  This  decrease  was  attributable  to both
decreases  in average  balances as well as a decrease in loan yields  associated
with  declining  market rates in 1998.  The average loan balance for the quarter
decreased  $4.6 million from $504.8 million for March 31, 1998 to $500.2 million
for March 31, 1999. The yield on the loan portfolio for March 31, 1999 was 7.55%
compared to 7.96% for the same period in 1998.

     Interest on deposits  decreased by $904,000 for the quarter ended March 31,
1999 compared to the quarter ended  March 31,  1998. The decrease was attributed
to both a decrease in the average balance of  interest-bearing  deposits as well
as a decrease  in the average  cost of these  deposits.  The average  balance of
interest-bearing deposits and the average cost of these deposits were $407.0 and
4.13%,  respectively,  for the first  quarter of 1999 as  compared to $445.9 and
4.58%, respectively, for the first quarter of 1998.

     Interest on  borrowings  decreased  $893,000  in the first  quarter of 1999
compared to the same quarter in 1998. This decrease was  substantially  due to a
$60.2 million  decrease in the average  balance of FHLB advances for the quarter
from $141.7 million for March 31, 1998 to $81.5 million for March 31, 1999.

Provision for Loan Losses

     The Company's  provision  for loan losses  decreased by $190,000 to $14,000
for the three  months  ended March 31, 1999 as compared to $204,000 for the same
period in 1998.  Net loans  charged off during the three  months ended March 31,
1999,  were $94,000  compared to $189,000 for the  comparable  1998 period.  The
difference  between  the  provision  for loan  losses and net loans  charged off
during the first  quarter of 1999  relates  primarily to loan types in which the
Bank is no longer active and for which provisions for loan losses have been made
previously which management believes to be adequate.


                                       14
<PAGE>

Other Income

     Total other  income  increased  by $266,000 or 17.0% for the quarter  ended
March  31,  1999 as  compared  to the same  period  in 1998.  The  increase  was
primarily  attributed  to  increases  of $56,000 in deposit  fees,  $121,000  in
merchant  processing  fees and $96,000 in gains on sales of loans,  all of which
are the result of increased volume.

Other Expenses

     Total other  expenses  increased by $377,000 or 8.4% from the first quarter
of 1999  compared to the first  quarter of the  previous  year.  The increase is
primarily  the result of a $348,000  increase in salaries and employee  benefits
associated,  in part,  with the  implementation  of the  Company's  core banking
growth initiatives which required additional lenders and retail bankers, as well
as salary increases.

Liquidity

     The  principal  sources of funds for the Company for the three months ended
March 31, 1999 included  $17.3 million in proceeds from the sale of loans,  $6.3
million in proceeds  from  principal  repayments  and  maturities  of securities
available  for sale,  and a $3.1  million  increase  in  securities  sold  under
agreement to repurchase.  Funds were used primarily to originate  loans held for
sale of $15.9  million,  to fund  purchases of securities  available for sale of
$11.1 million, and to fund a $7.7 million increase in loans held for investment,
as well as to compensate for a $6.5 million decrease in deposits.

     The Company's  liquidity could be impacted by a decrease in the renewals of
deposits  or general  deposit  runoff.  However,  the Company has the ability to
raise  deposits  by  conducting  deposit  promotions.  In the event the  Company
requires funds beyond its ability to generate them internally, the Company could
obtain  additional  advances from the FHLB.  The Company could also obtain funds
through the sale of investment securities from its available for sale portfolio.

     All savings  institutions,  including the Bank, are required to maintain an
average daily balance of liquid assets equal to a certain  percentage of the sum
of its average daily balance of net withdrawable deposit accounts and borrowings
payable in one year or less.  The  liquidity  requirement  may vary from time to
time (between 4% and 10%) depending  upon economic  conditions and savings flows
of all  savings  institutions.  At March 31, 1999 and  December  31,  1998,  the
required  liquid asset ratio was 4.0%.  The Bank's  liquid asset ratio was 9.98%
and 9.32% at March 31, 1999 and December 31, 1998, respectively.



                                       15
<PAGE>

Impact of the Year 2000 Issue

     The Year 2000 Issue is the result of computer  programs being written using
two digits rather than four to define the  applicable  year.  As a result,  such
computer  programs will not recognize the correct date after  December 31, 1999.
Also,  systems and  equipment  that are not  typically  thought of as  "computer
related"  (referred to as "non-IT")  contain imbedded  hardware or software that
may have a time element.

     In 1997,  the  Company  implemented  a four  phase  project  of  inventory,
assessment,  renovation  and  testing/implementation  to  address  the Year 2000
Issue.  The  scope of the  project  includes:  ensuring  the  compliance  of all
applications,  operating  systems  and  hardware  on the  mainframe,  PC and LAN
systems;  addressing  issues related to non-IT embedded  software and equipment;
and addressing the compliance of the Company's  significant  borrowers and third
party providers. A summary of significant milestones is presented below:

     The first three phases of inventory,  assessment and  renovation  have been
substantially  completed.  The fourth  phase,  testing and  implementation,  was
substantially  completed  at March  31,  1999.  The  Company  plans  to  conduct
additional  testing  throughout  the year and prepare and  finalize  contingency
plans.

     - The  Company has  determined,  based  primarily  on  communications  with
vendors, that the majority of the Company's non-IT related systems and equipment
are  currently  Year  2000  compliant.   Compilation  of  written  documentation
regarding compliance was substantially completed at the end of the first quarter
of 1999, as was testing of critical systems that the Company  determined  needed
to be conducted.

     - The potential  impact of Year 2000 will depend not only on the corrective
measures the Company  undertakes  but also on other entities who provide data to
or receive data from the Company and on those whose  operational  capability  or
financial  conditions  are  important to the  Company.  The Company has received
assurances  from all major  third party  vendors  that they are either Year 2000
compliant or expect to be in compliance  prior to the end of the second  quarter
of 1999. In addition,  management has reviewed  significant  lending and deposit
relationships  and consulted  with these  customers as to their plans to address
Year 2000 issues.  The plans of such parties are currently being  monitored  and
the Company is prepared to deal with any fundamental impact on the Company.

     - The Company has  established  an internal  review process to evaluate its
Year 2000 testing  results.  Monthly  progress reports are made to the Company's
senior management and Board of Directors.

     - The Company  estimates,  based on current  projections  of allocations of
existing  resources and known direct costs, that total costs related to the Year
2000 project  from 1997 to 2000 will be  approximately  $1,150,000.  The Company
estimates  that  approximately  78%  of  these  costs  will  be  related  to the
redeployment  of  existing   personnel  to  address  Year  2000  Issues,   while
approximately  22% of these  costs will  represent  incremental  expenses to the
Company since inception of the Year 2000 project.  Since inception,  the Company
estimates it has incurred  approximately  $640,000 of costs  related to its Year
2000 project, of which  approximately  $73,000 represents  incremental  expenses
primarily for software upgrades and outside  consultant fees. Of the $640,000 of
Year 2000  project  costs  incurred  since  inception,  approximately  $160,000,
$340,000 and $140,000 were incurred in 1997, 1998 and the first quarter of 1999,
respectively.  The  remaining  estimated  costs to complete the project  include
additional testing,  monitoring and contingency  activities during the remainder
of 1999 and into the year 2000.  Some  computer  related  initiatives  have been
delayed due to the allocation of resources towards Year 2000 issues.  Management
believes  there  has not  been an  adverse  impact  on the  Company's  financial
condition  or day to day  operations  as a result  of  computer  projects  being
deferred due to reallocation of resources to the Year 2000 project.

     - The  Company  has  established  a  Customer  Awareness  Program to inform
customers of Year 2000 issues and provide  status  reports as to the Bank's Year
2000 efforts.

     Based on our testing  program,  it is the  Company's  opinion that critical
systems are Year 2000  compliant.  In the unlikely event that a critical  system
does not  perform as  expected  or if there is  non-compliance  by a major third
party  provider,  the Company is  developing a  contingency  plan to address the
possible  failure of  critical  systems.  The Company  expects to  complete  its
contingency plan by the end of the second quarter of 1999.

                                       16
<PAGE>

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995

     Information  contained  in  the  above  discussion  titled,   "Management's
Discussion and Analysis of Financial Condition and Results of Operations," other
than historical information, may contain forward-looking statements that involve
risks and uncertainties  including, but not limited to, the Company's compliance
with and  estimates  related  to Year 2000  issues.  These  statements  are made
pursuant to the safe harbor  provisions of the Private  Litigation Reform Act of
1995, and are provided to assist the reader in understanding  anticipated future
financial  and  operational  results.  Although  the Company  believes  that the
assumptions  underlying  the  forward-looking  statements  contained  herein are
reasonable,  any of these  assumptions  could ultimately prove to be inaccurate.
The  Company's  actual  results may differ  materially  from those  projected in
forward-looking statements.


                                       17

<PAGE>

Item 3 - Quantitative and Qualitative Disclosure About Market Risk

Market Risk Management

     The  Company's   primary  market  risk  exposure  is  interest  rate  risk.
Fluctuations in interest rates will impact both the level of interest income and
interest expense and the market value of the Company's  interest-earning  assets
and  interest-bearing  liabilities.  There  were  no  material  changes  in  the
Company's  market risk  management  strategy,  as stated in the  Company's  1998
annual report, during the first three months of 1999.

PART II - OTHER INFORMATION


Item 1 - Legal Proceedings - Inapplicable


Item 2 - Changes in Securities - Inapplicable


Item 3 - Defaults Upon Senior Securities - Inapplicable


Item 4 - Submission of Matters to a Vote of Security Holders - None


Item 5 - Other Information - None


Item 6 - Exhibits and Reports on Form 8-K  -  None


                                   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.



 
 
                                          CENIT BANCORP, INC.



DATE: May 14, 1999                        /S/ Michael S. Ives
                                          -------------------         
                                          Michael S. Ives
                                          President and Chief Executive Officer



DATE: May 14, 1999                        /S/ John O. Guthrie
                                          -------------------         
                                          John O. Guthrie
                                          Senior Vice President and
                                          Chief Financial Officer


                                       18