[DESCRIPTION]	COVER PAGE
                  U.S. SECURITIES AND EXCHANGE COMMISSION
                       Washington, D.C. 20549

                           FORM 10-KSB
(Mark One)

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

For the fiscal year beginning January 1, 1998 and ending December 31, 1998


                     Commission file number: 0-2664


                        INVESTORS FINANCE, INC.
     ( Exact name of small business issuer as specified in its charter)
                         ___________________

              HAWAII                                    99-0112763
	(State or other jurisdiction of			(I.R.S. Employer
	incorporation or organization)			Identification No.)

        50 SOUTH BERETANIA STREET, HONOLULU, HAWAII     96813
	(Address of principal executive offices)	(Zip Code)

               Issuer's telephone number: (808) 533-7437
                         ___________________

Securities registered under Section 12(b) of the Exchange Act:

                                None

Securities registered under Section 12(g) of the Exchange Act:

                       Common Stock, no par value
                          (Title of class)
<PAGE>
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
  Yes [   ] No[ x ]

Check if there is no disclosure of delinquent filers in response to Item 405
of Regulation S-B contained in this form, and no disclosure will 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-KSB or any
amendment to this Form 10-KSB.  [ x ]

Issuer's revenues for its most recent fiscal year: $165,735

Aggregate market value of the issuer's common stock held by non-affiliates
as of December 31, 1998: $481,828

Number of shares outstanding of the issuer's common stock as of
December 31, 1998: 1,249,976.

                   DOCUMENTS INCORPORATED BY REFERENCE: None

            Transitional Small Business Disclosure Format (check one):

                            Yes [   ]  No [ X ]
<PAGE>
PART I

Item 1.	Description of Business

General

Investors Finance, Inc. (the "Company") is a Hawaii corporation engaged in the
business of mortgage brokerage and real estate, commercial, and consumer loans.
Total loan volume decreased to $80,981 on December 31, 1998 compared to
$307,385 for December 31, 1997.  Total revenue for 1998 was $165,735
compared to $213,407 for 1997.

1998 revenue included $51,801 of net income from mortgage brokerage commissions 
and $48,673 of net income from loan operations.

A one-time net charge of $177,753 was taken to clear doubtful receivables from 
the Company's balance sheet.  The Company will continue to vigorously pursue
collection of these receivables.

The Board of Directors understands the Company cannot continue to sustain a
decline in business.  If the Company does not become profitable in 1999,
plans are to cease operations and begin a consolidation of the Company.
Shareholders will then be offered an opportunity to vote on options regarding
the Company's future.

The Company's executive offices are located at 50 SOUTH BERETANIA STREET, 
HONOLULU, HAWAII 96813.  The Company's phone number is (808) 533-7437.


Development of Business

The Company was organized under the laws of the State of HAWAII
on November 1, 1960.


Business

Management believes the consolidation of the business operations and focusing
on the resale of mortgage loans provides the shareholders with much lower costs
regarding legal and regulatory expenses.


Principal Products and Services

The principal services of the Company are the origination and resale of
Residential and Commercial mortgages.  The Company continues to make
"in house" loans as funds are available.


Competition

The Mortgage originating business in the State of Hawaii is very competitive.
There are a number of Competitors within the state with substantial operating
histories and financial reserves.  Management believes the Company can be
profitable by controlling expenses and operating with a low overhead.


Government Approvals and Regulations

The products and services provided by the Company are not subject to government
approval.  The Company operating as an Industrial Loan Company and is regulated
by the State of Hawaii, Commissioner of Financial Institutions.

<PAGE>
Directors, Executive officers and Significant Employees

<TABLE>
<CAPTION>
NAME			AGE			POSITION
<S>                     <C>             <C>
Daniel Jeffers		45		President & Treasurer, Director

Karen Oani		45		Vice President & Secretary, Director
					Office Manager

Wade Richardson		58		Director

</TABLE>

Directors and Officers received no remuneration for services during 1998 with
the exception of Ms. Oani, who received $32,400 as salary.

PART II

ITEM 1.	Market Price and Dividends on the Company's Equity
        and other Shareholder Matters.

Market Information

There has been only limited trading activity in the Company's common stock
during 1998.  The following table sets forth quotes obtained from Abel Behnke
Corporation and listed in the Pacific Business News.

<TABLE>
<CAPTION>
		Quarter Ended				Bid Price
                <S>                                     <C>
		March 31,    1998			6.0 cents
		June 30,     1998			6.0 cents
		October 31,  1998			3.0 cents
		December 31, 1998			3.0 cents
</TABLE>
<PAGE>
Holders

The number of record holders of the Company's common stock as of
December 31, 1998 was approximately 1,021.


Dividends

The Company has not paid dividends with respect to its common stock, and does
not intend to pay dividends in the foreseeable future. it is the present
intention of management to utilize all available funds for the development of
the Company's business.


Item 2.	Legal Proceedings

Legal proceedings have been brought against the Company by a former mortgage
broker client.  The Company feels that the legal action is without merit and
plans a vigorous defense against such action.

Further, to the knowledge of management, no director, officer, affiliate or
record or beneficial owner of more than 5% of the common voting stock of the
Company is a party adverse to the Company or has a material adverse interest
to the Company in any proceeding.


Item 3.	Changes in and Disagreements with Accountants.

The Company did not change nor have any disagreements with its principal
accountants.


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

No matter was submitted to a vote of the security holders during the fourth
quarter ended December 31, 1998.


Item 5.	Reports on Form 8-K.

The Company has insufficient funds available for audited financials.