SECURITIES AND EXCHANGE COMMISSION
                      Washington, DC 20549
                            FORM 10-K
(Mark One)
_x_ Annual report pursuant to Section
13 or 15(d) of the Securities
Exchange Act of 1934
  For the fiscal year ended December 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 0-6835
                   IRWIN FINANCIAL CORPORATION
                      (Exact Name of Registrant as
                      Specified in its Charter)
                      
Indiana                            35-1286807
(State or Other Jurisdiction of
Incorporation or                  (I.R.S. Employer Identification No.)
 Organization)
500 Washington Street
Columbus, Indiana                        47201
(Address of Principal Executive Offices) (Zip Code) 
(812)376-1020 
(Registrant's Telephone Number,
Including Area Code)

Securities registered pursuant to Section
12(b) of the Act:  None

Securities registered pursuant to Section
12(g) of the Act: Common Shares
                                (Title of Class)

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 by check mark if disclosure ofdelinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein,and will not be contained, to the best of
registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to 
this Form 10-K.  [ x ]
The aggregate market value of the voting stock held by nonaffiliates of the
Registrant was $235,049,397 as of March 11, 1999.  As of March 11, 1999, there
were outstanding 21,689,574 common shares of the Registrant.

DOCUMENTS INCORPORATED BY REFERENCE

Selected Portions of                      Part of Form 10-K Into Which
the Following Documents                   Incorporated

Annual Report to Shareholders             Part I, Part II
for the year ended December
31, 1998 
Definitive Proxy Statement for            Part III 
Annual Meeting of
Shareholders to be held
April 29, 1999

Exhibit Index on Pages
15 through 17                                              Page 1

Total Pages in This Filing:  120
                             ___
FORM 10-K TABLE OF CONTENTS
Part I
     Item 1 - Business                     3
     Item 2 - Properties                   7
     Item 3 - Legal
       Proceedings                         8
     Item 4 - Submission of 
       Matters to a Vote of
       Security Holders                    9

Part II
     Item 5 - Market for Registrant's
           Common Equity and Related
           Security Holder Matters          9
     Item 6 - Selected Financial Data      10
     Item 7 - Management's Discussion and
     Analysis of Financial Condition and
     Results of Operations                 10
     Item 8 - Financial Statements and
            Supplementary Data             12
     Item 9 - Changes in and Disagreements
           with Accountants on Accounting
           and Financial Disclosure        12

Part III
     Item 10 - Directors and Executive
           Officers of the Registrant      12
     Item 11 - Executive Compensation      13
  Item 12 - Security Ownership of Certain
                Beneficial
            Owners and Management          13
      Item 13 - Certain Relationships and
                     Related Transactions  13

Part IV
     Item 14 - Exhibits, Financial
                Statement Schedules and
                Reports on Form 8-K        14

Signatures                                 19
                        PART I
Item 1    Business General
Irwin Financial Corporation (the "Registrant") is a diversified financial
services company organized as an Indiana bank holding company in May, 1972.  
The Registrant's principal subsidiaries are Irwin Mortgage Corporation 
("Irwin Mortgage", formerly Inland Mortgage Corporation), a mortgage banking 
company; Irwin Union Bank and Trust Company ("Irwin Union Bank"), a 
commercial bank; Irwin Home Equity Corporation ("Home Equity"), a
consumer home equity lending company; Irwin Equipment Finance Corp. ("Irwin
Equipment"), a leasing company; White River Capital Corporation, a small 
venture capital company; and Irwin Union Credit Insurance Corporation, a 
credit insurance company. Registrant is also the sole equity shareholder of 
IFC Capital Trust I ("Capital Trust"), a special purpose trust.

Business of Subsidiaries
Irwin Mortgage, acquired in 1981, originates, purchases and services
conventional or government agency backed (i.e., FHA and VA) residential 
mortgage loans.  Most mortgages are either insured by an agency of the 
federal government, or in the case of a conventional mortgage, meet 
requirements for resale to the Federal National Mortgage Association or
the Federal Home Loan Mortgage Corporation.  Irwin Mortgage also engages
in the nonprime first mortgage lending market.  This market is composed of
borrowers who do not qualify under the underwriting guidelines established 
by the government-sponsored secondary market agencies for conforming first 
mortgages.

Irwin Mortgage sells mortgage loans to institutional and private investors 
but may retain servicing rights to mortgage loans that it originates or 
purchases from correspondents.  Irwin Mortgage collects and accounts for the 
monthly payments on each loan serviced and pays the real estate taxes and 
insurance necessary to protect the integrity of the mortgage lien, for which 
it receives a servicing fee.  Irwin Mortgage operates 103 production and 
satellite offices in twenty-eight states.  During 1998, Irwin Mortgage
established offices in Orinda and San Diego, California; Gary and New Albany,
Indiana; Boca Raton, Florida; Jackson, Mississippi; Desloge, Missouri; 
Las Vegas (2), Nevada; Brick, New Jersey; Burlington, Madison and Greensboro, 
North Carolina; Broken Arrow and Bristow, Oklahoma; Hillsboro, Oregon; 
Columbia, South Carolina; Chattanooga, Tennessee; Austin, Texas; and Newport 
News and Virginia Beach, Virginia.  During 1998, Irwin Mortgage closed 
offices in Phoenix, Arizona; Covina, Morgan Hill and Irvine, California; 
Farmington, Connecticut; Columbus and Macon, Georgia; Lexington, Kentucky; 
New Orleans, Louisiana; Marlton, New Jersey; Independence/Cleveland, Ohio;
Columbia, South Carolina; and Chattanooga, Tennessee.

Irwin Mortgage and the Registrant have,for several years, explored 
opportunities to test the development of mortgage banking operations in 
markets outside the United States. During 1998, Irwin Mortgage made a
small number of loans on real estate located in Mexico.  The Registrant will
continue research of international opportunities to which the Registrant
might apply its knowledge and competencies.

Irwin Union Bank, organized in 1871, is a full service commercial bank 
offering a wide variety of services to individual, business, institutional, 
and governmental customers.  Irwin Union Bank's services include personal and 
commercial checking accounts, savings and time deposit accounts, personal and
business loans, credit card services, money transfer, financial counseling, 
property and casualty insurance agency services, trust services, securities 
brokerage and safe deposit facilities.  Irwin Union Bank is the largest of 
eleven financial institutions operating in Bartholomew County, Indiana, with 
eight locations throughout the county.  Irwin Union Bank also has branch 
facilities in Seymour (Jackson County - 2), Shelbyville (Shelby County), 
Bloomington (Monroe County - 3), Franklin and Greenwood (Johnson County 2),
Carmel (Hamilton County), Avon (Hendricks County), and Greensburg (Decatur 
County), Indiana.  In January, 1999, Irwin Union Bank opened loan production 
offices in Kalamazoo, Michigan and St. Louis, Missouri.  As of February 1, 
1998, Irwin Union Insurance, Inc., an insurance agency subsidiary of Irwin 
Union Bank, purchased substantially all the property and casualty assets of 
Maximum Benefits & Protection Co., Inc., an Indiana corporation. On December 
10, 1998, Irwin Union Bank established Irwin Reinsurance Corporation as a 
subsidiary, incorporated in Vermont, to engage in the business of insuring 
and reinsuring primarily mortgage lending risks.

Home Equity was formed in 1994 and is located in San Ramon, California.  Home
Equity originates and services home equity loans and lines of credit.  The 
loans are marketed through direct mail and telemarketing in twenty-nine 
states.  At year end, Home Equity began offering a first mortgage refinance 
program in selected states.

Irwin Equipment, formed in 1990 and located in Columbus, Indiana, is the
parent company of the former Affiliated Capital Corp., a small-ticket 
equipment leasing and commercial lending business.  On September 30, 1998, 
substantially all of the assets of Affiliated Capital Corp. were sold to DVI 
Financial Services, Inc.  After the asset sale, Affiliated Capital
Corp. changed its name to Irwin Leasing Corporation, which continues to hold
certain leases that were not part of the asset sale.

White River Capital Corporation ("White River"), a venture capital company, is
located in Columbus, Indiana and currently holds one investment but has 
suspended making new investments.

Irwin Union Credit Insurance Corporation is located in Columbus, Indiana and
provides credit life insurance to consumer loan customers of Irwin Union Bank.

IFC Capital Trust I ("Capital Trust"), is a statutory business trust created 
under the laws of Delaware.  The Registrant owns all of the Common
Securities of Capital Trust.  Capital Trust exists for the purpose of issuing
the Preferred Securities and investing the proceeds thereof in an equivalent 
amount of 9.25% Subordinated Debentures of the Registrant.  The Subordinated 
Debentures will mature on March 31, 2027, which date may be (i) shortened to 
a date not earlier than March 31, 2002, or (ii) extended to a date not
later than March 31, 2046, in each case if certain conditions are met 
(including, in the case of shortening the Stated Maturity, the Registrant 
having received prior approval of the Board of Governors of the Federal 
Reserve System ("Federal Reserve") to do so if then required under applicable
capital guidelines or policies of the Federal Reserve).  The Preferred
Securities will have a preference under certain circumstances with respect to
cash distributions and  amounts payable on liquidation, redemption or 
otherwise over the Common Securities. Holders of Preferred Securities are 
entitled to receive preferential cumulative cash distributions, at the annual
rate of 9.25% of the liquidation amount of $25 per Preferred Security 
accruing from the date of original issuance and payable quarterly
in arrears on the last day of March, June, September and December of each 
year, commencing March 31, 1997.

No single part of the business of the Registrant is dependent upon a single
customer or upon a very few customers and the loss of any one customer would 
not have a materially adverse effect upon the business of the Registrant.  
Irwin Mortgage is registered as a Foreign Financial Institution in Mexico.

Competition

Irwin Mortgage originates and services residential first mortgage loans from 
103 production and satellite offices in Arizona, California, Colorado, 
Delaware, Florida, Georgia, Hawaii, Illinois, Indiana, Kentucky, Louisiana,
Massachusetts, Minnesota, Mississippi, Missouri, Nevada, New Jersey, North
Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Texas, Utah, Washington,
Wisconsin, and the Washington, D.C. metropolitan area, including offices in
Maryland and Virginia.  In each of these locations, competition for mortgage 
loans is vigorous, coming from other national, regional and local mortgage 
banking companies as well as commercial banks, savings banks, and savings & 
loan associations.  Irwin Mortgage purchases mortgage loans from 
correspondents in these and other states as well.

The commercial banking business for Irwin Union Bank in the Bartholomew, 
Decatur, Hamilton, Hendricks, Jackson, Johnson, Monroe and Shelby County 
areas is very competitive.  Within these counties, in addition to the 
commercial banks, there are a number of savings banks, savings &
loan associations, and credit unions competing for deposits and loans.  Irwin
Union Bank also competes for the provision of banking services with banks 
located elsewhere in Indiana, primarily in south central Indiana, and with a 
number of nonbank companies located throughout the United States, including 
insurance companies, retailers, brokerage firms, companies offering money 
market accounts, and national credit card companies.  As of December 31,
1998, Irwin Union Bank ranked first among commercial banking and savings bank
institutions on the basis of Bartholomew County deposits.  In addition to the
above mentioned counties, Irwin Union Bank derives its business from several 
other counties in south central Indiana and is exploring the development of 
markets outside Indiana.

Home Equity originates and services home equity loans and lines of credit for
private home owners in several states.  Home Equity's primary competitors 
include banks, thrifts, credit unions and other home equity lenders with 
operations that are either national, regional or local in scope.  Such 
competitors may be headquartered anywhere in the country.

Irwin Equipment is inactive at present, except for managing the equipment 
leases that were not sold with the rest of the assets of the former 
Affiliated Capital Corp. in September of 1998.

Supervision and Regulation

The Registrant is a bank holding company within the meaning of the Bank 
Holding Company Act of 1956, as amended, and is registered with, regulated 
and examined by the Board of Governors of the Federal Reserve System (the 
"Board of Governors"). 

Subject to certain exceptions, a bank holding company is prohibited from
acquiring direct or indirect ownership or control of more than five percent 
of the voting shares of any company which is not a bank and from engaging 
directly or indirectly in activities unrelated to banking or managing or 
controlling banks. One exception to this prohibition permits
activities by a bank holding company or its subsidiary which the Board of
Governors determines to be so closely related to banking or managing or
controlling banks as to be a proper incident thereto.  The Board of Governors
has adopted regulations prescribing those activities it presently regards as
permissible, which include the activities engaged in by Registrant and its
subsidiaries.

The Bank Holding Company Act, the Federal Reserve Act, and the Federal Deposit
Insurance Act also subject bank holding companies and their subsidiaries to
certain restrictions on extensions of credit by subsidiary banks to the bank
holding company or any of its subsidiaries, or investments in the
securities thereof, and on the taking of such securities as collateral for 
loans to any borrower.  Further, the Bank Holding Company Act and the 
regulations of the Board of Governors thereunder, prohibit a bank
holding company and its subsidiaries from engaging in certain tie-in 
arrangements in connection with any extension of credit, sale or lease of any
property or furnishing of services.

In addition to the regulation of the Registrant, Irwin Union Bank is subject 
to extensive regulation and periodic examination, principally by the Indiana
Department of Financial Institutions and the Federal Reserve Bank of Chicago.
Irwin Mortgage is subject to audit and examination oversight by the federal
department of Housing and Urban Development as well as the Government
National Mortgage Association, the Federal National Mortgage Association, and
the Federal Home Loan Mortgage Corporation.  The insurance subsidiary of the 
Registrant and the insurance subsidiary of Irwin Union Bank are dependent 
upon state licenses and upon franchise agreements with private corporations 
for their continued existence.  The reinsurance subsidiary of Irwin Union 
Bank is subject to examination by the state of Vermont.
The home equity subsidiary of the Registrant is also dependent upon state
licenses for its ability to extend credit in certain states. Finally, the 
securities brokerage activities of Irwin Union Bank's registered 
broker/dealer are regulated and examined by the Securities and Exchange
Commission, the Indiana Securities Division, the securities divisions of the
various states in which Irwin Union Securities, Inc. operates, and the
National Association of Securities Dealers.

Employees and Labor Relations

As of December 31, 1998, the Registrant and its subsidiaries had a total of 
2,401 employees, including full-time and part-time employees.  The Registrant
continues a commitment of equal employment opportunity for all job applicants
and staff members, and management regards its relations with its employees as
satisfactory.

Further Information

The following information responsive to Guide 3 promulgated under the 
Securities Exchange Act of 1934, is contained in the "Management's Discussion
and Analysis of Financial Condition and Results of Operations" section of the
Annual Report to Shareholders for the year ending December 31, 1998 and is 
incorporated herein by reference:  "Daily Average Consolidated Balance Sheet,
Interest Rates and Interest Differential" (p. 68), "Investment Securities" 
(p. 52), "Short-Term Borrowings" (p. 54), "Summary of Net Interest Income 
Changes" (p. 50), "Deposits" (p. 53), "Loans and Leases" (p. 51), "Five-Year 
Selected Financial Data" (p. 23), and the discussion and tabular information 
under the caption "Credit Risk" on pages 58 to 62.

Executive Officers of the Registrant

The Executive Officers of the Registrant are elected annually by the Board of
Directors and serve for a term of one year or until their successors are
elected and qualified.  There are no arrangements or understandings between
any Executive Officer and any other person pursuant to which the Officer was
or is to be selected as an Officer.

Marie S. Ameis (36) is Vice President and Controller of the Registrant since 
May of 1992.

Claude E. Davis (38) is President of Irwin Union Bank since January 2, 1996.
He has been an officer since 1988.

Elena Delgado (43) is President of Irwin Home Equity Corporation since 
September 4, 1994.  From March through August, 1994, Ms. Delgado was an 
independent consultant to Irwin Financial Corporation.  From 1990 to 1993, 
Ms. Delgado was Vice President, Second Mortgage Lending of First Deposit
Corporation.

Gregory F. Ehlinger (36) is Vice President and Treasurer of the Registrant
since August of 1992. 

Jose M. Gonzalez (40) is Vice President and Director of Internal Audit of the
Registrant since October of 1995.  From 1993 to 1995, Mr. Gonzalez was Senior
Vice President, Audit & Compliance Services of Premier Bank and Trust.  From
1991 to 1993, Mr. Gonzalez was Vice President and Senior Compliance Officer
at First Empire State Corporation.

Theresa L. Hall (46) is Vice President - Human Resources of the Registrant, 
since 1988.  She has been an officer since 1980.

Rick L. McGuire, (46) is President of Irwin Mortgage since January 1, 1996.  
He has been an officer since 1978.

William I. Miller (42) is Chairman of the Board, since 1990, and has been a
Director of the Registrant since 1985.

Ellen Z. Mufson (50) is Vice President - Legal of the Registrant, since 
September, 1997.  She was Vice President - Legal Counsel of Irwin Union Bank 
and Trust Company from July, 1996 through August, 1997; Corporate Counsel of 
Irwin Financial Corporation from January, 1995 through June, 1996; Deputy
Director/General Counsel of the Indiana Development Finance Authority from 
March, 1992 through November, 1994.

John A. Nash (61) is Chairman of the Executive Committee, since 1990, and
President, since 1985, of the Registrant. He has been an officer and Director of
the Registrant since 1972.

Michael F. Ryan (53) is Vice President - Community Development of the 
Registrant since January 2, 1996. He was President of Irwin Union Bank from 
1981 1995.  He has been an officer since 1976.

Matthew F. Souza (42) is Vice President and Ethics Officer/Secretary of the
Registrant.  He has been an officer since 1985.

Thomas D. Washburn (52) is Senior Vice President and Chief Financial Officer,
since 1980, of the Registrant.  He has been an officer since 1976.

Item 2.  Properties

The location and general character of the materially important physical 
properties of the Registrant and its subsidiaries are as follows: The main 
office of Irwin Mortgage, where administrative and servicing activities are 
centered, is located at 9265 Counselor's Row, Indianapolis, Indiana
and a servicing facility is located at 11800 Exit Five Parkway, Indianapolis,
Indiana. Irwin Mortgage also has loan production and satellite offices located
in Flagstaff, Phoenix, Mesa, Scottsdale, and Tucson, Arizona; Antioch,
Bakersfield, Concord, Covina, Fresno, Laguna Hills, Orinda, Richmond,
Sacramento, Salinas, San Diego, Temecula, Ventura, Visalia, Walnut Creek, 
Woodland, Yuba City, and Yreka, California; Castle Rock, Colorado Springs, 
Denver, Englewood, and Woodland Park, Colorado; Newark, Delaware; Boca Raton,
Clearwater and Orlando/Longwood, Florida; Atlanta, Georgia; Aiea, Honolulu, 
Kailua, and Maui, Hawaii; Chicago and Decatur, Illinois; Indianapolis (5), 
Anderson, Gary, Ft. Wayne, Kendallville, Kokomo, Lafayette, New Albany, South
Bend, and Warsaw, Indiana; Louisville, Kentucky; Baton Rouge, Louisiana;
Columbia, Rockville, and Towson, Maryland; Braintree, Massachusetts; Arden
Hills, Burnsville, and Minneapolis, Minnesota; Jackson, Mississippi; Desloge
and St. Louis, Missouri; Las Vegas(2), Nevada; Brick, New Jersey; Cary,
Charlotte, Greensboro (2), Raleigh, Wilmington, Madison and Burlington, North
Carolina; Dayton, Ohio; Broken Arrow, Bristow and Tulsa, Oklahoma; Beaverton,
Hillsboro and Lake Oswego, Oregon; Wyomissing, Pennsylvania; Austin (2),
Corpus Christi, Dallas, El Paso, and Houston, Texas; Salt Lake City, Utah;
Fredericksburg, Glen Allen, Newport News, Richmond, Springfield, Suffolk, and
Virginia Beach, Virginia; Bellevue, Battleground, Everett, and Mount Lake
Terrace, Washington; and Madison, Wisconsin.  All offices occupied by Irwin
Mortgage are leased.

The main office of Irwin Union Bank is located in four connected buildings all
at 500 and 520 Washington Street, Columbus, Indiana.  These buildings and
one branch building are owned in fee by Irwin Union Realty Corporation, a 
wholly-owned subsidiary of Irwin Union Bank, and are leased by Irwin Union 
Bank.  Irwin Union Bank owns in fee three of its other fifteen relatively 
small branch banking premises.  The other branch offices are leased.  None of
the properties owned by Irwin Union Bank are subject to any major encumbrances.

The main office of Irwin Home Equity is located at 12677 Alcosta Blvd., Suite
500, San Ramon, California.  This office location is leased.

The main offices of the Registrant, Irwin Equipment, White River Capital
Corporation and Irwin Union Credit Insurance Corporation are located at 500
Washington Street, Columbus, Indiana in space leased from Irwin Union Bank.

Item 3.  Legal Proceedings

As a part of the ordinary course of business, the Registrant and its
subsidiary companies are parties to litigation involving claims to the
ownership of funds in particular accounts, the collection of delinquent
accounts, challenges to security interests in collateral, and foreclosure
interests, that is incidental to their regular business activities.  In
addition to such claims, the Registrant was involved, as of December 31, 
1998, in the following actions: 

Banda et al. v. City of Houston et al. Irwin Mortgage was
--------------------------------------
served as a defendant in a class action lawsuit initiated in the district 
court of Harris County, Texas in March of 1998. The suit alleged that a 
Houston housing opportunity program, in which Irwin Mortgage was a 
participating lender, used inaccurate lead paint tests that resulted
in a class of homeowners being subjected to harmful levels of lead and 
property devaluations. At present, it is difficult to predict the likelihood 
of an unfavorable outcome or to establish the possible extent or
amount of liability or potential loss exposure, if any, to which Irwin 
Mortgage might be exposed. 

Culpepper, et al. v. Inland Mortgage Corporation.  As of December 31, 1998,
-------------------------------------------------
Irwin Mortgage was a defendant in a class action lawsuit initiated in the 
United States District Court, Northern District of Alabama in April, 1996.  
This action is one of a number of "RESPA Section 8" class actions that have 
been filed against several mortgage lenders challenging the legality of the 
payment of broker fees by mortgage lenders to mortgage brokers. On January 9,
1998, the Court of Appeals for the Eleventh Circuit reversed the district 
court's grant of summary judgment in favor of Irwin Mortgage and vacated the 
district court's dismissal of class claims and denial of class certification. 
On June 22, 1998, the appeals court denied Irwin Mortgage's petition for 
rehearing, but issued an opinion clarifying its original opinion.
Subsequently on remand, the district court granted a joint motion to
consolidate Culpepper and Hiers (see below).  At present, it is impossible to
predict the likelihood of an unfavorable outcome or to establish the possible
extent or amount of liability or potential loss exposure, if any, to which
Irwin Mortgage might be exposed. 

Heifets, et al. v. Matrix Electromedical, et al.  As of December 31, 1998,
------------------------------------------------
Affiliated Capital Corp. (now, Irwin Leasing Corporation) and Irwin Financial
Corporation were defendants in a class action lawsuit initiated against them 
in August, 1998 in the Superior Court of Los Angeles County, California.
The suit alleges that a manufacturer of certain medical devices made
misrepresentations to induce doctors to acquire the devices, which Affiliated
Capital Corp. financed by means of leases.  The alleged misrepresentations
concerned the ability to obtain Medicare coverage for treatments using the
equipment, which coverage was subsequently denied. The doctors are
seeking rescission of the leases and other damages allegedly caused by the
doctors' reliance on the manufacturer's statements.  The litigation is at an
early stage and it is impossible to predict the likelihood of an unfavorable
outcome or to establish the possible extent or amount of liability or
potential loss, if any, to which Irwin Financial might be exposed.  The leases
affected by this lawsuit (the "Matrix Leases") were not transferred as part 
of the sale of assets of Affiliated Capital Corp.  Irwin Financial retains 
liability, if any, in connection with the Matrix Leases.

Hiers, et al. v. Irwin Mortgage Corporation et al. As of December 31,
--------------------------------------------------
1998, Irwin Mortgage was a defendant in a class action lawsuit initiated in 
August, 1998 in the United States District Court, Northern District of 
Alabama.  As mentioned above, this suit was consolidated with Culpepper and is
similar to other "RESPA Section 8" class actions that have been filed against
several mortgage lenders challenging the legality of the payment of broker 
fees by mortgage lenders to mortgage brokers. The litigation is at an early 
stage and it is impossible to predict the likelihood of an unfavorable 
outcome or to establish the possible extent or amount of liability or 
potential loss, if any, to which Irwin Mortgage might be exposed.

Howell, et al. v. Inland Mortgage Corporation.  As of December 31, 1998,
----------------------------------------------
Irwin Mortgage was a defendant in a class action lawsuit initiated in the 
state of Indiana in January 1995. Plaintiffs alleged that lenders do not have
the right to require borrowers to pay premiums for private mortgage insurance.
On February 2, 1999, the Marion County, Indiana Superior Court dismissed the 
case with prejudice.

Kruta (formerly referred to as Basmoen), et al. v. Inland Mortgage Corporation.
-------------------------------------------------------------------------------
As of December 31, 1998, Irwin Mortgage was a defendant in a class action 
lawsuit initiated in the state of Minnesota in October, 1995.  The case is 
currently pending before a federal Multidistrict Litigation Panel in Chicago,
Illinois.  Plaintiffs allege that they represent a nationwide class of 
persons who have or had mortgage escrow accounts allegedly improperly managed
by Irwin Mortgage. This case is among a series of class action cases 
commenced against a number of mortgage servicers in several states
challenging the practices used in connection with the administration of
escrow accounts for single family residential mortgages.  The court granted 
plaintiff's motion to add James Kruta as a class representative on September 
8, 1997 and also granted a renewed motion for class certification on March 
25, 1998.  At this stage of the litigation, it is impossible to predict
the likelihood of an unfavorable outcome or to establish the possible extent 
or amount of liability or potential loss, if any, to which Irwin Mortgage 
might be exposed.  Except as described above, there is no material pending 
litigation in which the Registrant or any of its subsidiaries is
involved or of which any of their property is the subject. Furthermore,
there is no pending legal proceeding that is adverse to the Registrant in 
which any director, officer or affiliate of the Registrant, or any associate 
of any such director or officer, is a party, or has a material interest.

Item 4.  Submission of Matters to a Vote of Security Holders
During the fourth quarter of 1998, no matters were submitted to a vote of
security holders of the Registrant, through the solicitation of
proxies or otherwise.

PART II

Item 5.  Market for Registrant's Common Equity and Related Stockholder Matters
The Common Stock of the Registrant is quoted on the National Association of
Securities Dealers Automated Quotation/National Market System
(NASDAQ/NMS trading symbol, IRWN).  The following table sets forth certain
information regarding trading in, and cash dividends paid with respect to, the
shares of the Registrant's Common Stock in each quarter of the two most recent
calendar years. All data have been adjusted for stock splits.
The approximate number of shareholders of record on March 11, 1999 was 1,818.

Stock Prices and Dividends:

                 High      Low       Quarter    Cash        Total Dividens
                 $         $         End        Dividend    For Year       
                                     $          $           &
1997 (split
adjusted)

First Quarter    15 1/4    12 1/8     13 5/8     $0.035             
Second Quarter   14 3/4    12         14 3/4      0.035
Third Quarter    18 5/8    14 3/8     18          0.035
Fourth Quarter   21 1/2    18 1/4     21          0.035          $0.14

1998 (split
adjusted)

First Quarter    28 1/4    19 1/2     28 1/8      $0.04
Second Quarter   30        25 1/8     29          $0.04
Third Quarter    37        20 1/2     24 5/8      $0.04
Fourth Quarter   31        20 1/8     27 1/5      $0.04          $0.16
                      
The Registrant expects to continue its policy of paying regular cash dividends,
although there is no assurance as to future dividends because they are
dependent on future earnings, capital requirements, and financial condition.
On February 19, 1998, the Registrant's Board of Directors approved an increase
in the Registrant's quarterly dividend to $.04 per share (split adjusted) 
which dividend rate was unchanged as of December 31, 1998.  Dividends paid by
Irwin Union Bank to the Registrant are restricted by banking law.

No sales of unregistered equity securities were made by the Registrant
during the fourth quarter of 1998.

Item 6.  Selected Financial Data

The information contained in the Annual Report to Shareholders for the year 
ended December 31, 1998, under the caption "FiveYear Selected Financial 
Data", is incorporated herein by reference in response to this item.

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

The information set forth under the caption "Management's Discussion and
Analysis of Results of Operations and Financial Condition" in the Annual 
Report to Shareholders for the year ended December 31, 1998, is incorporated 
herein by reference in response to this item.

Item 7a.  Quantitative and Qualitative Disclosures About Market Risk--Interest
Rate Sensitivity

Interest rate sensitivity refers to the potential for changes in market rates of
interest to cause changes in net interest income and in the market value of 
assets and liabilities.

The Asset-Liability Management Committee of the commercial bank monitors the
repricing structure of both assets and liabilities over various time horizons.
Exposure to changes in interest rates is evaluated by modeling the repricing
characteristics of the commercial bank's portfolio under multiple rate 
scenarios. Rate sensitivity at the commercial bank can typically be managed 
by controlling the maturity of loans, securities, and deposits. The 
commercial bank may also use financial futures or interest rate swaps
from time to time.  Formal policies approved by the Bank's Board of Directors
ensure that exposure to changes in net interest revenues is maintained within
acceptable levels.

The mortgage banking business assumes a form of interest rate sensitivity by
entering into commitments to extend loans to borrowers at a fixed price for a
limited period of time.  Loans are also held temporarily until a pool is 
formed. The mortgage bank buys commitments to deliver loans at a fixed price 
to manage risk.  The policy at the home equity lending business is to 
matchfund all loan assets.  The mortgage bank and the home equity company are
also exposed to interest rate risk through their ownership of servicing 
assets.  As discussed in the analysis of each line of business earlier 
in this report, the companies also manage their risk using a variety of 
techniques including: maintaining a strong production operation which offsets
the interest rate risk, selective sales of the servicing rights, and the use
of financial hedges. In some cases, the Registrant uses internal hedges to 
allow for the risk   characteristics of one line of business to offset those 
of another line.

While traditional interest rate risk focuses on the changes in
net interest income due to interest rate changes, the Registrant engages in 
other activities which are also affected by interest rate changes.  Principal
among these are mortgage loan origination and servicing. Through the use of 
simulations using regression modeling, option-adjusted valuation techniques 
for estimating expected customer behavior, and Monte Carlo based cash flow 
simulation, the Registrant attempts to analyze and mitigate total interest 
rate risk that is associated with both net interest income and non-interest 
income.  For example, if interest rates decline, management expects an
increase in mortgage loan origination income and a decline in the value of
mortgage servicing assets.  Management attempts to monitor this exposure to
traditional interest rate risk as well as interest rate influences on 
production and servicing value in a comprehensive manner.

The following table shows management's estimate of the present value of 
interest-sensitive assets and liabilities, as well as off-balance sheet 
financial contracts as of December 31, 1998, at then current interest rates 
as well as simulated rates 1.0% and 2.0% above and below those interest 
rates.  It does not take into account the book values of the Registrant's 
non-interest sensitive assets and liabilities, such as cash, accounts 
receivable, and fixed assets, the value of which is not directly
determined by interest rates.

As noted above, the analysis is based on discounted cash flows over the 
remaining estimated lives of the financial instruments. The total measurement
of the Registrant's exposure to interest rate risk as presented in the 
following table may not be representative of the actual values which might 
result from a higher or lower rate environment.  Such environments would 
likely result in different lending and borrowing strategies by the 
Registrant, designed in part to further mitigate the effect on
the value of, and the net earnings generated from, the Registrant's net
assets from any change in interest rates.

The figures suggest, based on balance sheet and off balance sheet financial
assets, that the present value of the Registrant's interest-sensitive assets
and liabilities would decline in a falling rate environment and increase in
a rising rate environment.  The magnitude and direction of the present value 
rate sensitivity is largely unchanged from 1997.

As previously noted, this present value sensitivity analysis does not account
for potential earnings the Registrant would recognize due to strategic 
initiatives it would undertake if the interest rate scenarios model occurred,
nor does it reflect activities not traditionally measured as financial assets or
liabilities. Principal among these activities for the Registrant would be
the change in mortgage loan production and the earnings stream the Registrant
derives therefrom.


                 PRESENT VALUE ($000)
                 AT DECEMBER 31, 1998
                           -2%       -1%      CURRENT     +1%       +2%

Interest Sensitive
Assets

Interest-bearing          18,528    18,512    18,495      18,479    18,463
deposits with banks                
Federal Funds Sold         8,651     8,651     8,651       8,651     8,651
Taxable investment        80,556    78,210    76,873      76,069    75,554
securities                                   
Tax-exempt investment      5,727     5,513     5,309       5,115     4,930
securities
Mortgages held for sale  974,732   970,182   965,055     959,305   952,905
                    
Mortgage Servicing        41,930    77,595   117,728     152,402   174,714
Rights                            
Loans, net of unearned   624,196   612,499   601,338     591,228   581,262 
discount        

Total Interest         1,754,320 1,771,162 1,793,449   1,811,249 1,816,479
Sensitive Assets       

Interest Sensitive
Liabilities

Non-Interest Bearing    486,091    483,042   480,168     477,458   474,898
Deposits                    
Money Market Checking   122,395    122,317   122,239     122,162   122,084      
Money Market Savings      6,509      6,504     6,499       6,494     6,489
Regular Savings          98,965     98,886    98,808      98,730    98,653     
Time Deposits           295,576    292,831   290,152     287,566   285,123     
Short term borrowings   637,654    637,272   636,890     636,512   636,134
Long Term Debt           70,887     65,220    60,750      57,199    54,344
Total Interest        1,718,077  1,706,072 1,695,506   1,686,121 1,677,725
Sensitive Liabilities  

Interest Sensitive Off   14,423     13,690     5,347       1,027     1,484 
Balance Sheet Items         
Net Sensitivity as of    50,666     78,780   103,290     126,155   140,238
December 31, 1998                
Potential Change        -52,624    -24,510                22,865     36,948
                          
Net Sensitivity as of   -12,165      6,895    28,911      47,188     55,873
December 31, 1997       
Potential Change        -41,076    -22,016                18,277     26,962
                        
                                                                              
Item 8.  Financial Statements and Supplementary Data

Consolidated financial statements of the Registrant and its subsidiaries are 
contained in the Annual Report to Shareholders for the year ending December 
31, 1998, under the caption "1998 Financial Statements", and are incorporated
herein by reference in response to this item.

Item 9.  Changes in and Disagreements With Accountants on Accounting and 
Financial Disclosure

In connection with the audits of the Registrant for the two most
recent fiscal years ended December 31, 1998, the Registrant has not changed 
its independent certified public accountants nor have there been any 
disagreements (as defined in Instruction 4 to Item 304 of Regulation S-K) 
with such accountants on any matter of accounting principles or practices, 
financial statement disclosure, or auditing scope or procedure.
                
PART III
                    
Item 10.  Directors and Executive Officers of the Registrant

The information contained in the proxy statement of the Registrant for the 
1999 Annual Meeting of Shareholders under the caption "Election of 
Directors", on pages 4 through 7, inclusive, is incorporated herein by 
reference in response to this item.

Item 11.  Executive Compensation

The information contained in the proxy statement of the Registrant for the 
1999 Annual Meeting of Shareholders under the captions "Election of Directors -
Outside Director Compensation ", "Executive Compensation and Other
Information" and "Board Compensation Committee Report on Executive
Compensation" on pages 10 through 19, inclusive, is incorporated herein by
reference in response to this item.

Item 12.  Security Ownership of Certain Beneficial Owners and Management

The information contained in the proxy statement of the Registrant for the 
1999 Annual Meeting of Shareholders under the captions "Voting
Securities and Principal Holders" and "Security Ownership of Management", on
pages 2 and 3, inclusive, is incorporated herein by reference in
response to this item.

Item 13.  Certain Relationships and Related Transactions

The information contained in the proxy statement of the Registrant for the 
1999 Annual Meeting of Shareholders under the caption "Interest of Management in
Certain Transactions" on pages 20 and 21, is incorporated herein by reference
in response to this item.

PART IV
                 
Item 14.  Exhibits, Financial Statement Schedules, and Reports on Form 8-K

                                                        Page # 
a. Documents filed as a part of this Report:   Form               Annual
                                               10-K               Report

     1.   Financial Statements:
          A. Irwin Financial Corporation and
             Subsidiaries:

     Report of PricewaterhouseCoopers LLP,
     Independent Accountants                                         88

     Consolidated Statement of Income
     for the years ended December 31, 1998,
     1997, and 1996                                                  89

     Consolidated Balance Sheet as of
     December 31, 1998, and 1997                                     90

     Consolidated Statement of Changes in
     Shareholders' Equity for the years
     ended December 31, 1998, 1997 and
     1996                                                            91

     Consolidated Statement of Cash Flows
     for the years ended December 31, 1998,
     1997, and 1996                                                  92

     Notes to Consolidated Financial Statements                      93

The above listed report, financial statements, and the notes thereto, set
forth on pages 85 through 115 of the Registrant's 1998 Annual Report to
Shareholders are incorporated herein by reference.
    
     2.   Financial Statement Schedules
          
          None

Schedules are omitted because they are not required or the information is
included in the Notes to Consolidated Financial Statements.
     
     3.   Exhibits
     
     A. Exhibits to Form 10-K

Number Assigned in                                    Sequential Numbering
Regulation                                            System Page Number 
S-K Item 601      Description of Exhibit              of Exhibit 
                          
 (2)                    No exhibit.
 (3) (i)          3(a) Amended Articles of
                       Incorporation,
                       dated December 29, 1972.
                       (Incorporated by
                       reference to
                       Exhibit 3(a) to
                       Form 10-K Report
                       for year ended
                       December 31,1985,
                       File No. 0-6835.)
                       
                  3(b) Articles of Amendment, dated
                       March 30, 1973.
                       (Incorporated by reference to 
                       Exhibit 3(b) to Form 10-K
                       Report for year ended December
                       31, 1985, File No. 0-6835.) 
                            
                  3(c) Articles of Amendment, dated
                       September 4,1990. (Incorporated
                       by reference to Exhibit 3(d) to
                       Form 10-K Report for year ended
                       December 31, 1990, File No. 0-6835.)
                       
                  3(d) Articles of Amendment, dated
                       April 30, 1992. (Incorporated by
                       reference to Exhibit 3(d)
                       to Form 10-K Report for year
                       ended December 31, 1992,
                       File No. 0-6835.)
                       
                  3(e) Articles of Amendment, dated
                       April 26, 1994.
                       (Incorporated by reference
                       to Exhibit 3(e) to Form 10-K
                       Report for year ended December
                       31, 1994, File No. 0-6835.)
                       
                  3(f) Articles of Amendment, dated
                       April 30, 1996. (Incorporated by
                       reference to Exhibit (f) to Form
                       10-K Report for year ended
                       December 31, 1996, File No.
                       0-6835.)
                       
     (ii)         3(a)  Code of By-Laws as amended to date.

 (4)              4(a)  Specimen stock certificate. 
                        (Incorporated by reference
                        to Exhibit 4(a) to Form 10-K
                        Report for year ended December
                        31, 1994, File No. 0-6835.)
                       
                  4(b)  Certain instruments defining
                       the rights of the holers oflong-
                       term debt of the Registrant and
                       certain of its subsidiaries, none
                       of which authorize a total amount
                       of indebtedness in excess of 10%
                       of the total assets of the Registrant
                       and its subsidiaries on a
                       consolidated basis, have not been
                       filed as Exhibits.  The Registrant
                       hereby agrees to furnish a copy of
                       any of these agreements to the
                       Commission upon request.
  (9)                  No exhibit.
 (10)              10(a)Amended 1986 Stock Option Plan.
                       (Incorporated by reference to
                       Exhibit 10(b) to Form 10-K Report
                       for year ended December 31, 1991,
                       File  No. 06835.)
                       
                  10(b)Amended and Restated Management Bonus
                       Plan. (Incorporated by reference to Exhibit
                       19(a) to Form 10-K Report for year ended
                       December 31, 1986, File No. 06835.)
                       
                  10(c) Long-Term Management Performance Plan.
                        (Incorporated by reference to Exhibit 10(d) to
                        Form 10-K Report for year ended December 31, 1986,
                        File No. 06835.)

                  10(d) Long-Term Incentive Plan Summary of Terms.
                        (Incorporated by reference to Exhibit 10(e) to 
                        Form 10-K Report for year ended December 31,
                        1986, File No. 06835.)
     
                  10(e) Irwin Financial Corporation Employees' Stock
                        Purchase Plan. (Incorporated by reference to Exhibit
                        10(f) to Form 10-K Report for year ended December 31,
                        1991, File No. 0 6835.)

                  10(f) Employee Stock Purchase Plan II. (Incorporated
                        by reference to Exhibit 10(f) to Form 10-K
                        Report for year ended December 31, 1994, File No.
                        06835.)
     
                  10(g) Amended Irwin Financial Corporation Outside
                        Directors Restricted Stock Compensation Plan.
                        (Incorporated by reference to Exhibit 10(g) to 
                        Form 10-K Report for year ended December 31, 1991, 
                        File No. 0 6835.)
     
                  10(h) Irwin Financial Corporation 1992 Stock Option Plan.
                        (Incorporated by reference to Exhibit 10(h) to Form 
                        10-K report for year ended December 31, 1992, File
                        No. 06835.)
     
                  10(i) Amended Irwin Financial Corporation Outside
                        Director Restricted Stock Compensation Plan.
                        (Incorporated by reference to Exhibit
                        10(i) to Form 10-K report for year ended
                        December 31, 1995, File No. 0-6835.)

                  10(j) Inland Mortgage Corporation Long Term
                       Incentive Plan. (Incorporated by
                       reference to Exhibit (10)(j) to Form 10-K
                       report for year ended December 31,
                       1996, File No. 0-6835.)
                       
                  10(k) Irwin Financial Corporation 1997 Stock
                       Option Plan. (Incorporated by
                       reference to Exhibit (10) to Form 10-Q
                       report for quarter ended June 30, 1997,
                       File No. 0-6835.)
                       
                  10(l) Amendment to Irwin Financial Corporation
                       1997 Stock Option Plan. (Incorporated by
                       reference to Exhibit (10) to Form 10-Q report for
                       quarter ended June 30, 1997, File No. 06835.)
                       
(11)              11(a) Computation of Earnings Per Share.                21
                                        
(12)                    No exhibit.

(13)              13(a) Registrant's 1998 Annual                          22
                       Report to Shareholders.
                       This exhibit contains
                       such portions thereof
                       that have been
                       incorporated by
                       reference into this
                       Report.

(16)                    No exhibit.

(18)                    No exhibit.

(21)              21(a) Subsidiaries of the Registrant.                  117
                       
(22)                    No exhibit.

(23)              23(a) Consent of Independent Accountants.              118
                       
(24)                    No exhibit.

(27)                    Financial Data Schedule.                         119
                                       
(99)              99(a) Annual Report on Form 11-K for the Irwin
                        Financial Corporation Employees'
                        Savings Plan for the year
                        ending December 31, 1998.*

                  99(b) Annual Report on Form 11-K for the
                        Irwin Mortgage Corporation
                        Retirement and Profit Sharing
                        Plan for the year ending December 31, 1998.*

*  To be filed by amendment pursuant to Rule 15d-21.

b.   Reports on Form 8-K

     None.

                     SIGNATURES
             
                      
                        
           
                        
                        
               
                      
Pursuant to the requirements of Section 13 or 15(d)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.

                                                  IRWIN FINANCIAL CORPORATION
Date:  March 30, 1999
                                                  By:  /s/ William I. Miller
                                                       ---------------------
                                                       William I. Miller,
                                                       Chairman of the Board

Pursuant to the requirements of the Securities Exchange Act of 1934, this 
report on Form 10-K has been signed below by the following persons on behalf 
of the Registrant and in the capacities on the dates indicated.
          
Signature                     Capacity with                   Date
                              Registrant             
/s/ Sally A. Dean             Director                        March 30, 1999
-----------------
Sally A. Dean


/s/ David W. Goodrich         Director                        March 30, 1999
---------------------
David W. Goodrich


/s/ John T. Hackett           Director                        March 30, 1999
-------------------
John T. Hackett


/s/ William H. Kling          Director                        March 30, 1999
--------------------
William H. Kling


/s/ Brenda J. Lauderback      Director                        March 30, 1999
------------------------
Brenda J. Lauderback

/s/ John C. McGinty, Jr.      Director                        March 30, 1999
------------------------
John C. McGinty, Jr.


/s/ Irwin Miller              Director                        March 30, 1999
----------------
Irwin Miller


/s/ William I. Miller    Director, Chairman                   March 30, 1999
--------------------     of the Board 
William I. Miller        (Principal
                         Executive Officer)


/s/ John A. Nash         Director, Chairman                   March 30, 1999
----------------         of the Executive
John A. Nash             Committee
                         
                         
/s/ Lance R. Odden            Director                        March 30, 1999
------------------
Lance R. Odden


/s/ Theodore M. Solso         Director                        March 30, 1999
---------------------
Theodore M. Solso

/s/ Thomas D. Washburn      Senior Vice President             March 30, 1999
----------------------      (Principal Financial
Thomas D. Washburn          Officer)   

/s/ Marie S. Ameis       Vice President and                   March 30, 1999
------------------       Controller
Marie S. Ameis           (Principal Accounting
                         Officer)