SECURITIES AND EXCHANGE COMMISSION
                                         Washington, DC 20549

FORM 10-KSB
for Annual Report Under Section 13
or 15(d) of the Securities Exchange Act of 1934

X      ANNUAL REPORT PURSUANT TO SECTION 12 OR 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934 [FEE REQUIRED]

       For the fiscal year ended December 31, 1996
OR
       TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934 [FEE REQUIRED]

       For the transition period from ____________ to ____________           

                     Commission File No.:  0-25958

                           ND HOLDINGS, INC.
          (exact name of Registrant as specified in its charter)

         North Dakota                                     45-0404061
         (State or other jurisdiction of                (IRS Employer
         incorporation or organization               Identification Number)

                               1 North Main
                          Minot, North Dakota 58701
                  (Address of principal executive offices)

     Registrant's telephone number, including area code:  (701) 852-5292

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

Securities registered pursuant to Section 12(g) of the Act:  Common
Stock, no par value

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
periods as 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 of delinquent 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-KSB or any amendment to this Form 10-KSB.  [X]

The issuer's revenues for the year ended December 31, 1996 were
$3,417,614.

There is no quoted public market for the Registrant's Common Stock.  On
March 31, 1997, there were 8,191,751 shares of the Registrant's common
stock, outstanding.

Documents Incorporated by Reference

The Company's Annual Report to Shareholders for the year ended December
31, 1996 is incorporated by reference into certain sections of Parts I
and II.  The Company's definitive proxy statement for the Annual Meeting
of Shareholders to be held on May 9, 1997 is incorporated by reference
into certain sections of Part III.  Certain exhibits previously filed
with the Securities and Exchange Commission are incorporated by
reference into Part IV.

Transitional Small Business Disclosure Format:    YES  _____    NO __X__

<PAGE>

                                PART I

Item 1.    Business of the Company

History

The Company, through its subsidiaries, acts as a mutual fund
administrator and management firm.  The Company's revenues are derived
(through its subsidiaries) as fees from operating, managing and
investing the assets of mutual funds and to a lessor extent from
brokerage commissions related to transactions within the mutual funds as
well as on the purchase by or sale of mutual funds by individuals.  The
Company currently manages the assets of nine mutual funds, six of which
were initiated, sponsored and organized by the Company. As a result of
the acquisition of The Ranson Company, Inc. completed on January 5,
1996, the Company is the manager of three funds, called the "Ranson
Managed Portfolios".  Ranson Capital Corporation, a NASD member
broker/dealer and the investment advisor and manager for the three
"Ranson Managed Portfolios":  the Kansas Municipal Fund, Kansas Insured
Intermediate Fund and the Nebraska Municipal Fund, is a subsidiary of
The Ranson Company (and now the Company).  On September 25, 1996, a new
fund, the Oklahoma Municipal Fund, was established by the Company as a
part of the Ranson Managed Portfolios.

The Company, ND Holdings, Inc., was incorporated September 22, 1987, as
a North Dakota corporation and officially organized on October 27, 1987,
in Minot, North Dakota by Robert Walstad, current President of the
Company.  The primary intent of this corporation was to provide a
vehicle for investment in North Dakota by North Dakota residents all
pursuant to Chapter 10-30.1 of the North Dakota Century Code, as
amended.  

The major accomplishment of the Company until 1996 had been the
establishment, management and distribution of five mutual funds: ND Tax-
Free Fund, Inc., ND Insured Income Fund, Inc., Montana Tax-Free Fund,
Inc., South Dakota Tax-Free Fund, Inc. and Integrity Fund of Funds (the
"Funds").  The Funds have grown to over $144,000,000 in assets as of
December 31, 1996.  With the acquisition of The Ranson Company, Inc.
completed on January 5, 1996, Ranson Capital Corporation, as a wholly
owned subsidiary of the Company, continues to act as the investment
adviser and manager for the Ranson Managed Portfolios.  The Ranson
Managed Portfolios provided additional managed asset base of
approximately $184,000,000.  As a result, total assets managed by the
Company now total in excess of $334,000,000.  Investment advisory, asset
management, underwriting and transfer agent services are provided to
mutual funds managed and administered by the Company's wholly-owned
subsidiaries.  Currently, through its three wholly-owned subsidiaries,
ND Money Management, Inc., ND Capital, Inc. and ND Resources, Inc., the
Company acts as advisor to five mutual funds: ND Tax-Free Fund, Inc., ND
Insured Income Fund, Inc., Montana Tax-Free Fund, Inc., South Dakota
Tax-Free Fund, Inc. and Integrity Fund of Funds, Inc.  Ranson Capital
Corporation is the investment adviser and manager for the Ranson Managed
Portfolios, including the newly established Oklahoma Municipal Fund.  
The Company also provides administrative and stock transfer services to
the Ranson Managed Portfolios.  Revenue is received for the management
of the Funds along with commissions for investments sold to individuals
in sponsored funds as well as in other unaffiliated mutual funds.  Fees
are also generated for stock transfer and clerical services provided to
the affiliated mutual funds.

The Company and its subsidiaries are still in developmental stages.  The
areas in which they do business or intend to do business are highly
competitive and place them in direct competition with other mutual fund
firms, some of which have substantially greater resources, proven
management, and established markets.

                                     2

<PAGE>

The Company's Subsidiaries and Operations

The Company has five wholly-owned subsidiaries through which it conducts
its operations.  Three of the subsidiaries, all North Dakota
corporations, are ND Money Management, Inc., a Registered Investment
Advisor; ND Capital, Inc., an NASD member broker/dealer; and ND
Resources, Inc., a Registered Stock Transfer Agent.  Pursuant to terms
of an acquisition agreement described in "Certain Transactions - The
Ranson Acquisition" the Company acquired two additional wholly-owned
subsidiaries in the year ended December 31, 1996, The Ranson Company,
Inc., a Kansas corporation, and its subsidiary, Ranson Capital
Corporation, a Kansas corporation.  The Ranson Company, Inc. has no
independent operations.  Ranson Capital Corporation is an NASD
Registered broker/dealer and SEC registered investment advisor.

ND Money Management, Inc. (a North Dakota corporation) was organized to
manage investment portfolios, particularly, but not limited to, the
Funds.  

ND Capital, Inc. (a North Dakota corporation), an NASD and SIPC member
broker/dealer was organized as an entity to raise funds for investing
in, and providing financing to, qualified entities while encouraging
capital investment in North Dakota.  

ND Resources, Inc. (a North Dakota corporation) was originally organized
to purchase and/or manage mineral properties.  ND Resources, Inc.
thereafter became a registered stock transfer agent and now acts as
transfer agent for the Funds.  

ND Money Management, Inc., a registered investment advisor, was
organized as an entity to provide fund management services to mutual
funds.  ND Money Management, Inc.'s primary operations are as fund
manager and advisor for the ND Tax-Free Fund, Inc., Montana Tax-Free
Fund, Inc., ND Insured Fund, Inc., South Dakota Tax-Free Fund, Inc. and
Integrity Fund of Funds, Inc.  The Company receives management fees from
the Funds.  As fund manager and advisor for these funds, ND Money
Management, Inc. is economically dependent on the Funds for the majority
of its revenue.

ND Money Management, Inc. has an affiliation with the ND Tax-Free Fund,
Inc., Montana Tax-Free Fund, Inc., South Dakota Tax Free-Fund, Inc. the
ND Insured Fund, Inc., and the Integrity Fund of Funds, Inc.

ND Capital's primary operations are as broker/dealer for distribution of
shares of the ND Tax-Free Fund, Inc., Montana Tax-Free Fund, Inc., ND
Insured Income Fund, Inc., South Dakota Tax-Free Fund, Inc. and
Integrity Fund of Funds, Inc.  The Company receives fees from the funds
as underwriter as well as commission income for investments sold to
customers in other unaffiliated mutual funds.  

ND Capital, Inc. has an affiliation with the ND Tax-Free Fund, Inc.,
Montana Tax-Free Fund, Inc., South Dakota Tax-Free Fund, Inc., the ND
Insured Income Fund, Inc. and the Integrity Fund of Funds, Inc.  As
underwriter for these funds, ND Capital, Inc. is economically dependent
on them for a majority of its revenue.  

ND Capital, Inc. is subject to the Securities and Exchange Commission
Uniform Net Capital Rule (SEC Rule 15c3-1), which requires the
maintenance of minimum net capital and requires that the ratio of
aggregate indebtedness to net capital, both as defined, shall not exceed
15 to 1 (and the rule of the "applicable" exchange also provides that
equity capital may not be withdrawn or cash dividends paid if the
resulting net capital ratio would exceed 10 to 1).  At December 31,
1996, ND Capital had net capital well in excess of its minimum required
net capital of $25,000.

ND Resources, Inc. is a Registered Transfer Agent.  ND Resources, Inc.'s
primary operations are as transfer agent of shares of the ND Tax-Free
Fund, Inc., Montana Tax-Free Fund, Inc., ND Insured Income Fund,

                                     3

<PAGE>

Inc., South Dakota Tax-Free Fund, Inc. and Integrity Fund of Funds, Inc. 
ND Resources, Inc. receives fees from the Funds for stock transfer,
administrative and clerical services.  As transfer agent for these
funds, ND Resources, Inc. is economically dependent on them for a
majority of its revenue.

ND Resources, Inc. has an affiliation with the ND Tax-Free Fund, Inc.,
Montana Tax-Free Fund, Inc., South Dakota Tax-Free Fund, Inc., the ND
Insured Income Fund, Inc., and the recently opened Integrity Fund of
Funds, Inc.

In 1996, the Company completed an agreement which allowed the Company to
acquire management of the Ranson Managed Portfolios (the "Ranson
Funds"), through acquisition of their advisor, Ranson Capital
Corporation and its parent, The Ranson Company, Inc.  This acquisition
was complete as of January 5, 1996.

Ranson Capital Corporation, ("Ranson Capital") a Kansas corporation, is
the investment adviser and manager for each Series of the Ranson Managed
Portfolios. Ranson Capital is a broker/dealer registered with the
Securities and Exchange Commission and is a wholly-owned subsidiary of
The Ranson Company, Inc., a Kansas corporation.  Ranson Capital was
formed in 1990 and acts as investment advisor and fund manager for the
Ranson Managed Portfolios, consisting of the Kansas Insured Intermediate
Fund, Kansas Municipal Fund, the Nebraska Municipal Fund and the
Oklahoma Municipal Fund.  John A. Ranson, Alex R. Meitzner, Mark J.
Kneedy, John J. Hass, Robin K. Pinkerton, Stephen E. Shorgren and
Douglas K. Rogers (the "Selling Ranson Stockholders") previously owned
all the outstanding Common Stock of The Ranson Company, Inc.  The
Selling Ranson Stockholders of The Ranson Company, Inc., the parent of
Ranson Capital, entered into a contract dated as of September 15, 1995
(the "Agreement") whereby the Company acquired all outstanding shares of
The Ranson Company, Inc., and therefore acquired all business related to
the Ranson Managed Portfolios through the indirect acquisition of Ranson
Capital (the "Acquisition").  Ranson Capital, which is now wholly-owned
by the Company continues to operate by that name and continues to act as
investment adviser and manager for each Series of the Ranson Managed
Portfolios.

The contractual division of responsibilities between the Company and its
affiliated funds track the three main functions of any mutual fund. 
Contracts for portfolio management performed by the Company's
subsidiary, ND Money Management, Inc., in the case of the five original
Funds and by Ranson Capital Corporation in the case of the Ranson
Managed Portfolios are awarded annually by review and approval of the
independent Boards of Directors of the various Funds (the "Boards"). 
The Board of Directors of each Fund consists of five directors, three of
whom are independent and two (Robert E. Walstad and Peter A. Quist) of
whom are affiliated with the Company.  These Boards are also responsible
for awarding the Company's subsidiary, ND Capital the underwriting
agreements for the Funds, which contracts are referred to as "contracts
for distribution" by the Funds (mutual fund regulations limit
underwriting agreements to one year) as well as contracting with the
Company's subsidiary, ND Resources, Inc., for all administrative
services. (which are typically one to three year contracts). 
Distribution and administrative services contracts are generally
terminable by a Fund's Board for "cause" (as defined in the contract).

Administration.

A Fund's administrator generally is responsible for all of the Fund's
business activities other than distribution and investment decisions. 
The Company believes that administration is an extension of
distribution, that high quality servicing is critical to retaining
shareholder accounts, and that quality of service directly impacts the
growth of mutual fund assets.  Therefore, the Company strives to create
an error-free operating environment based on stringent standards
established for all service provider subsidiaries of the Company.

The Company's administrative responsibilities may be divided into three
major services:

                                     4

<PAGE>

     -   shareholder recordkeeping - encompasses all mutual fund
         shareholders' transactions, including taking purchase and
         redemption orders, entering orders into the transfer agent system
         and forwarding information regarding trade activity to the
         portfolio manager and to fund accountants as specified.
     
     -   fund accounting - provides the daily recordkeeping for each fund,
         including calculations of net asset value per share, dividend rates
         per share, and the maintenance of all books, records and financial
         reports required by the SEC and other regulatory agencies.  This
         service also includes preparation of quarterly financial
         statements, shareholder reports and Board reports for each
         portfolio, participation in the periodic updating of prospectuses,
         preparation of federal, state and local tax returns, payment of all
         costs and expenses of each fund, and the maintenance of the
         official books and records of each fund.
     
     -   cash management - ensures timely receipts and disbursements on
         shareholder activity for effective asset management.

Overview of Managed Mutual Fund Industry

Since the 1980's, the mutual fund business has been one of the fastest
growing areas of the financial services industry.  Total assets in
mutual funds grew from approximately $100 billion in 1980 to
approximately $2 trillion in total assets by 1994.  According to the
Investment Company Institute Special Analysis for the 1990's Study,
mutual fund assets are projected to continue to grow at an average of
12% annually, to approximately $3.4 trillion in total assets by the year
2000.

Company Growth Strategy

The Company's historical strategy has been to establish localized mutual
funds, in a niche area of rural states, which funds invest in bond
and/or equity instruments of local interest.  The Company targets the
residents of the same localized areas to achieve its investor base.  The
Company has established mutual funds in North Dakota, Montana, Oklahoma
and South Dakota, all rural, low population states where competition
from other mutual funds as well as larger and more diversified
competitors in the securities industry is less intense.  

The Company has acquired management of the Ranson Managed Portfolios
(the "Ranson Funds"), through acquisition of their advisor, Ranson
Capital Corporation and its parent, The Ranson Company, Inc.  This
acquisition was completed January 5, 1996.  Ranson Capital Corporation,
which is now wholly-owned by the Company, continues by that name and
acts as investment adviser and manager for each of the Ranson Funds. 
The Ranson Funds added approximately $184,000,000 to the Company's
assets under management, bringing total assets currently under
management to approximately $334,000,000.  Please see "Certain
Transactions-The Ranson Acquisition", "Management's Discussion and
Analysis" and "Business".

The Company will in the future seek to locate compatible existing mutual
funds and seek to acquire money management firms with mutual funds under
management, thereby immediately increasing the Company's base of assets
under management.

Finder Agreement with KPMG Peat Marwick LLP

The Company has retained KPMG Peat Marwick LLP financial service
division to perform certain services with respect to the Company's
interest in expanding its base of funds under management by acquiring
other investment fund managers.  Services to be provided to the Company
include:  development of an acquisition strategy; identification of
target companies; contact with target companies; and preliminary
financial analysis on the target companies.

                                     5

<PAGE>

Competition

Since its inception, the Company has directly competed primarily with a
number of larger, more established mutual fund service organizations and
securities firms.  Competition is influenced by various factors,
including breadth, quality of service and price.  All aspects of
Company's business are competitive, including competition for mutual
fund assets to manage.  Large national firms have much greater marketing
capabilities, offer a broader range of financial services and compete
not only with the Company and among themselves but also with commercial
banks, insurance companies and others for retail and institutional
clients.  The Company's affiliated mutual funds, although localized in
nature, are subject to competition from nationally and regionally
distributed funds offering equivalent financial products with returns
equal to or greater than those offered by the Funds.

The Company is focused on the niche area of rural states and localized
investment where competition from major investment institutions is lower
than in population centers.  To the knowledge of the Company it is the
only mutual fund sponsor consisting of affiliated investment advisor,
broker/dealer and transfer agent entities based in North Dakota, South
Dakota or Montana.  However, competition for assets under management is
intense from both national and regional based firms.  Access to local
investment and the population of the region by modern communication
systems is so efficient that the Company's geographical position cannot
be deemed a significant advantage.

The Company's investment management operations compete with a large
number of other investment management firms, commercial banks, insurance
companies, broker/dealers and other financial service firms.  Most of
these firms are larger and have access to greater resources than the
Company.  The investment advisory industry is characterized by
relatively low cost of entry and the formation of new investment
advisory entities which may compete directly with the Company is a
frequent occurrence.  The Company directly competes with as many as
several hundred firms which are of similar or larger size.  The
Company's ability to increase and retain clients' assets could be
materially adversely affected if client accounts under-perform the
market.  The ability of the Company's investment management subsidiary
to complete with other investment management firms also is dependent, in
part, on the relative attractiveness of their investment philosophies
and methods under prevailing market conditions.

A large number of mutual funds are sold to the public by investment
management firms, broker/dealers, insurance companies and banks in
competition with the Company's affiliated funds.  Many of the Company's
competitors apply substantial resources to advertising and marketing
their mutual funds which may adversely affect the ability of the
Company's affiliated funds to attract new assets.  The Company expects
that there will be increasing pressures among mutual fund sponsors to
obtain and hold market shares.

Regulation of the Company's Business

Under the Investment Company Act, the distribution agreements between
the Funds and the Company's subsidiary terminate automatically upon
their assignment.  The term "assignment" includes direct assignments as
well as assignments which may be deemed to occur, under certain
circumstances, upon the transfer, directly or indirectly, of a
controlling block of the Company's voting securities.  The Investment
Company Act presumes that any transfer of more than 25% of the voting
securities of any person represents a transfer of a controlling block of
voting securities.  The Company does not believe that the transactions
contemplated by this offering will result in an "assignment" of the
distribution or administration agreements.

The securities industry, including broker/dealer, investment advisory,
and transfer agency firms in the United States, are subject to extensive
regulation under federal and state laws.  Much of the regulation of
broker/dealers has been delegated to self-regulatory organizations,
principally the National Association of Securities Dealers (NASD).  The
regulations to which broker/dealers are subject cover all aspects of the

                                     6

<PAGE>

securities business, including sales methods, trade practices, capital
structure of securities firms, record keeping and the conduct of
directors, officers and employees.  Additional state and federal
legislation, changes in rules promulgated by the United States
Securities and Exchange Commission (SEC) and by self-regulatory
organizations, or changes in the interpretation or enforcement of
existing laws and rules often directly affect the methods of operation
and profitability of money managers, broker/dealers and transfer agents. 
Investment related firms are also subject to regulation and licensing by
state securities commissions in the states in which they transact
business.  The SEC, state securities administrators and the self-
regulatory organizations may conduct administrative proceedings which
can result in censure, fine, suspension or expulsion of a broker/dealer,
its officers or employees.  The principal purpose of regulation and
discipline of broker/dealers, investment advisors, and stock transfer
agents is the protection of customers and the securities markets rather
than protection of creditors and stockholders of such firms.

Industry Regulations

The Company is subject to extensive regulation as to its duties,
affiliations, conduct and limitations on fees.  Section 22(b) of the
Investment Company Act of 1940 provides that a securities association
registered under Section 15A of the Securities Exchange Act of 1934 may
adopt rules prohibiting its members from receiving a commission,
discount, spread or fees except in accordance with a method or methods,
and within such limitations as to the relation thereof to said public
offering price, as such rules may prescribe in order that the price at
which such security is offered or sold to the public shall not include
an excessive sales load but shall allow for reasonable compensation for
sales personnel, broker/dealers, and underwriters, and for reasonable
sales loads to investors.  Section 22(c) of the Investment Company Act
of 1940 further states that the commission may make rules and
regulations applicable to registered investment companies and to
principal underwriters of, and dealers in, the redeemable securities of
any registered investment company, whether or not members of any
securities association.  Any rules and regulations so made by the
Commission, to the extent that they may be inconsistent with the rules
of any securities association, shall, so long as they remain in force,
supersede the rules of the association and be binding upon its members
as well as all other underwriters and dealers to whom they may be
applicable.

The Company's wholly-owned broker/dealer subsidiaries, ND Capital, Inc.
and Ranson Capital Corporation are NASD members.  The NASD, a securities
association registered under Section 15 A of the Securities and Exchange
Act of 1934 has prescribed rules (Section 26 of the NASD Rules of Fair
Practice) with respect to maximum commissions, charges and fees related
to investment in any open-end investment company registered under the
Investment Company Act of 1940.

Additionally, under Section 206 of the Investment Advisers Act of 1940
it is unlawful for any investment adviser to (1) employ any device,
scheme, or artifice to defraud any client or prospective client; (2)
engage in any transaction, practice, or course of business which
operates as a fraud or deceit upon any client or prospective client; or
(3) engage in any act, practice, or course of business which is
fraudulent, deceptive, or manipulative.

An investment adviser can transfer control of an investment company only
under the provision that for three years at least seventy-five (75%)
percent of the directors of the investment company are independent of
the new and old investment adviser, and provided no unfair burden is
imposed on the investment company as a result of the sale.  The effect
of such transfer is to terminate the old investment adviser agreement
and to require the new agreement to be approved by both the board and
shareholders.  Directors and the investment adviser are fiduciaries,
accordingly, the SEC is authorized to initiate an action to enjoin a
breach of fiduciary duties involving personal misconduct by officers,
directors, investment advisers, and principal underwriters. 
Shareholders or the SEC may also bring an action against the officers,
directors, and investment adviser for breach of fiduciary duty in
establishing the compensation paid the investment adviser.

                                     7

<PAGE>

An investment adviser to a fund, its principals, and its employees may
also be subject to proceedings initiated by the SEC to impose remedial
sanctions for violation of any provision of the federal securities laws
and the regulations adopted thereunder, and the SEC may preclude such
investment adviser to an investment company from continuing to act in
the capacity. 

Investment companies such as the Funds are subject to considerable
substantive regulation.  Such companies must comply with periodic
reporting requirements.  Proxy solicitations are subject to the general
proxy rules as well as to special proxy rules applicable only to
investment companies.  Shares of investment companies can only be
offered at a uniform public offering price based on the current share
net asset value plus the sales load.  No more than 60 percent of the
directors can be interested persons, defined to include, among others,
persons affiliated with the management company or underwriter, and a
majority of the directors must not be affiliated with the underwriter. 
The management agreement must have initially been approved by a majority
of the outstanding shares and, after two years, must be annually
approved, either by the board or by the outstanding voting shares.  The
management agreement must automatically terminate in the event of
assignment and must be subject to termination upon 60 days notice by the
board or by a vote of the majority of the outstanding voting shares. 
The underwriting agreement must be annually approved by the board or by
a vote of a majority of the outstanding voting shares, and must provide
for automatic termination in event of assignment.  Transactions between
the investment company and an affiliate can be entered into only if
approved by the SEC, after notice and opportunity for hearing, as fair
and equitable.

Net Capital Requirements

As a broker/dealer, and as a member firm of the NASD, the Company's
subsidiary, ND Capital and its new subsidiary, Ranson Capital
Corporation are subject to the Uniform Net Capital Rule (Rule 15c3-1)
promulgated by the SEC which provides that a broker/dealer doing
business with the public must maintain certain net minimum capital and
shall not permit its aggregate indebtedness to exceed certain specified
limitations.  The Rule is designed to measure a firm's financial
integrity and liquidity.  A broker/dealer may be required to reduce its
business and restrict withdrawal of subordinated capital if its net
capital drops below specified levels, and also may be prohibited from
expanding its business or declaring cash dividends.  In addition,
failure to maintain the required net capital may subject a broker/dealer
to disciplinary actions by the SEC, the NASD and state securities
administrators, including fines, censure, suspension or expulsion.  The
Uniform Net Capital Rule may limit the uses ND Capital and Ranson
Capital may make of its capital.

At December 31, 1996, ND Capital, Inc.'s required net capital was
$25,000.  Ranson Capital Corporation's required net capital was
$100,000.  At December 31, 1996 and the date of this report, both
subsidiaries' net capital was in excess of required net capital.

Factors which affect ND Capital and Ranson Capital's net capital include
the general investment climate as well as the ability of the Company to
obtain any liquid assets necessary to contribute equity capital to its
wholly-owned subsidiaries.  Although ND Capital and Ranson Capital
currently have sufficient net capital, should the Company's liquidity be
impaired substantially as a result of any factor, including potential
demands for cash created by the rescission offer, and additional net
capital become necessary, the continued operation of ND Capital and/or
Ranson Capital could be restricted or suspended.

The Uniform Net Capital Rule requires the ratio of aggregate
indebtedness, as defined, to net capital not exceed 15 to 1, and imposes
certain restrictions on operations.  In computing net capital, various
adjustments to net worth are made with a view to excluding assets which
are not readily convertible into cash and with a view to a conservative
statement of other assets, such as a firm's position in securities.  The
two Broker Dealer subsidiaries of the Company may not allow withdrawal
of subordinated capital if minimum net capital would thereafter be less
than 5% of aggregate debit items as defined under the SEC Uniform Net
Capital Rule.  Further, no Broker Dealer may permit equity capital to be
withdrawn whether by payment of

                                     8

<PAGE>

dividends, repurchase of stock or other means, if its net capital would
thereafter be less than 5% of aggregate debit items as defined under the
SEC Uniform Net Capital Rule.  Compliance with the Uniform Net Capital
Rule may limit those operations of a firm which may require the use of
its capital.

Employees

At December 31, 1996, the Company had 18 full-time employees, including
eight (8) registered representatives, licensed by the NASD, who are
associated with ND Capital, Inc.  The acquisition of The Ranson Company,
Inc. added three additional employees (retained employees of Ranson
Capital Company) in early 1996.  Registered Representatives earn
commissions through ND Capital, Inc. but receive their paychecks from
the Company.  ND Capital, Inc. reimburses the Company (its parent)
through intercompany transfers for such commission payments.  Salaried
and hourly employees are paid directly by ND Holdings, Inc. (the
Company).  State and federal wage and tax reporting is done by the
Company.  The employees of the Company perform various services in all
necessary capacities for each of the subsidiaries as well as the Holding
Company (the Company).  Technically, except for Registered
Representatives associated with ND Capital, Inc., the subsidiaries of
Company have no employees.  The Company and its subsidiaries are
currently developing a plan to restructure its employee arrangement so
that specific persons will become employees in form and substance in
each subsidiary where operations actually occur.

Item 2    Properties

The Company owns no material physical properties.

The Company's offices are located at 1 North Main, Minot, North Dakota. 
The Company and each of its subsidiaries conduct their operations from
that location.  This facility consisting of approximately 4,000 square
feet is leased from an unaffiliated entity on a five year agreement
ending approximately May 31, 2001 with the option to renew for an
additional five years.  Lease payments are $3,000 per month.  The
Company also has an option to purchase the building at any time during
the term of the Lease.

Item 3    Legal Proceedings

Except for the regulatory issues described below, the Company is not
involved in any material pending legal proceedings, nor is management
aware of any threatened litigation.

Pursuant to a previous registration, offers of cash rescission to any
unaffiliated purchaser who purchased the Company's Common Stock between
September 1, 1992 and March 9, 1995 (Common Stock totaling 4,859,207
shares) has been completed as of October 12, 1996.  Shareholders
accepting rescission number only five (5) and cash paid out in
rescission was $139,737.  This rescission offer was the result of sales
by ND Capital, Inc., and other broker/dealers unrelated to Company, of
Common Stock of the Company to a total of eleven persons not residents
of the State of North Dakota between May 28, 1991 and July 5, 1994 while
the Company was relying upon an intrastate exemption (Section 3(a)(11)
of the 1933 Securities Act).

Section 5(a) of the Securities Act of 1933 requires that a registration
statement pursuant to the requirements set forth in Section 6 of the
Securities Act of 1933 be filed with the US Securities and Exchange
Commission (the "SEC") and in effect prior to offers or sales of a
security.  The Company relied upon the "intrastate" exemption provided
by Section 3(a)(11) of the Securities Act of 1933 and the North Dakota
exemption from registration provided by NDCC 10-04-05(13) for securities
issued by a venture capital corporation organized under Chapter 10-30.1
in making sales of its Common Stock.  The exemption from registration
required by Section 5(a) of the Securities Act of 1933 may not be
available, thereby creating liability to the Company under federal
securities laws.  The Company does not believe that sales to
nonresidents of North Dakota effects its exemption from registration
with the North Dakota Securities Commission.  Federal law claims

                                     9

<PAGE>

may be brought by investors for up to three years after the date of the
offer of the unregistered Common Stock.

Although compliance with the requirements of the applicable state
rescission may bar future state claims, acceptance or rejection of the
offer of rescission may not bar holders from asserting any claims
against the Company for alleged violations of Federal Securities Laws. 
Contingent liability of the Company may not necessarily be eliminated by
making the Rescission Offer.

Item 4    Submission of Matters to a Vote of Security Holders

No matters were submitted to a vote of security holders during the
fourth quarter ended December 31, 1996.


                               PART II

Item 5    Market Price

There is currently no public market for the Company's Common Stock.  The
Company's securities do not trade on any exchange or system at present.

The Company has not paid a dividend with respect to its Common Stock nor
does the Company anticipate paying dividends in the foreseeable future. 
As of March 31, 1997, there were 785 shareholders of record.

Item 6    Management's Discussion and Analysis of Financial Condition
and Results of Operations

Information in response to this item is incorporated by reference to the
information provided in the 1996 Annual Report under the heading
"Management's Discussion and Analysis of Results of Operations and
Financial Condition."

Item 7    Financial Statements and Supplementary Data

Information in response to this item is incorporated by reference to the
Financial Statements, Notes thereto and Report thereon contained in the
1996 Annual Report.

Item 8    Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure

None.


                               PART III

Item 9    Directors and Executive Officers of the Registrant 

Information in response to this item is incorporated herein by reference
to the information provided in the Company's Proxy Statement for its
Annual Meeting of Shareholders to be held on May 9, 1997 (the "1997
Proxy Statement") under the heading "Directors and Executive Officers." 
Incorporated by reference to the Company's Proxy Statement for Annual
Meeting of Stockholders to be filed with the Securities and Exchange
Commission within 120 days after the close of the fiscal year ended
December 31, 1996.

                                    10

<PAGE>

Item 10    Executive Compensation

Information in response to this item is incorporated herein by reference
to the information provided in the 1997 Proxy Statement under the
heading "Executive Compensation."  Incorporated by reference to the
Company's Proxy Statement for Annual Meeting of Stockholders to be filed
with the Securities and Exchange Commission within 120 days after the
close of the fiscal year ended December 31, 1996.

Item 11    Security Ownership of Certain Beneficial Owners and
Management

Information in response to this item is incorporated herein by reference
to the information provided in the 1997 Proxy Statement under the
heading "Security Ownership of Management and Principal Stockholders." 
Incorporated by reference to the Company's Proxy Statement for Annual
Meeting of Stockholders to be filed with the Securities and Exchange
Commission within 120 days after the close of the fiscal year ended
December 31, 1996.


Item 12    Certain Relationships and Related Transactions

Incorporated by reference to the Company's Proxy Statement for Annual
Meeting of Stockholders to be filed with the Securities and Exchange
Commission within 120 days after the close of the fiscal year ended
December 31, 1996.


PART IV

Item 13    Exhibits and Reports on Form 8-K

(a)      The following documents are filed as a part of this report:

3.       The following exhibits are filed herewith or incorporated herein by
         reference as set forth below:

         3.1      Articles of Incorporation of the Company (incorporated by
                  reference to Exhibit 3.1 contained in the Company's
                  Registration Statement on Form S-1, as amended (File No. 33-
                  96824), filed with the Commission on September 12, 1995).

         3.2      Bylaws of the Company (incorporated by reference to Exhibit
                  3.2 contained in the Company's Registration Statement on Form
                  S-1, as amended (File No. 33-96824), filed with the Commission
                  on September 12, 1995).

         4.1      Specimen form of Common Stock Certificate (incorporated by
                  reference to Exhibit 4.1 contained in the Company's
                  Registration Statement on Form S-1, as amended (File No. 33-
                  96824), filed with the Commission on September 12, 1995).

         4.2      Instruments defining rights of holders of securities:  See
                  Exhibit 3.1.

         10.1     Management Advisory Contract - ND Tax-Free Fund, Inc.
                  (incorporated by reference to Exhibit 10.1 contained in the
                  Company's Registration Statement on Form S-1, as amended (File
                  No. 33-96824), filed with the Commission on September 12,
                  1995)

                                    11

<PAGE>

         10.2     Management Advisory Contract - Montana Tax-Free Fund, Inc.
                  (incorporated by reference to Exhibit 10.2 contained in the
                  Company's Registration Statement on Form S-1, as amended (File
                  No. 33-96824), filed with the Commission on September 12,
                  1995)

         10.3     Management Advisory Contract - South Dakota Tax-Free Fund,
                  Inc. (incorporated by reference to Exhibit 10.3 contained in
                  the Company's Registration Statement on Form S-1, as amended
                  (File No. 33-96824), filed with the Commission on September
                  12, 1995)

         10.4     Management Advisory Contract - ND Insured Income Fund, Inc.
                  (incorporated by reference to Exhibit 10.4 contained in the
                  Company's Registration Statement on Form S-1, as amended (File
                  No. 33-96824), filed with the Commission on September 12,
                  1995)

         10.5     Management Advisory Contract - Integrity Fund of Funds, Inc.
                  (incorporated by reference to Exhibit 10.5 contained in the
                  Company's Registration Statement on Form S-1, as amended (File
                  No. 33-96824), filed with the Commission on September 12,
                  1995)

         10.6     Transfer Agency Agreement - ND Tax-Free Fund, Inc.
                  (incorporated by reference to Exhibit 10.6 contained in the
                  Company's Registration Statement on Form S-1, as amended (File
                  No. 33-96824), filed with the Commission on September 12,
                  1995)

         10.7     Transfer Agency Agreement - Montana Tax-Free Fund, Inc.
                  (incorporated by reference to Exhibit 10.7 contained in the
                  Company's Registration Statement on Form S-1, as amended (File
                  No. 33-96824), filed with the Commission on September 12,
                  1995)

         10.8     Transfer Agency Agreement - South Dakota Tax-Free Fund, Inc.
                  (incorporated by reference to Exhibit 10.8 contained in the
                  Company's Registration Statement on Form S-1, as amended (File
                  No. 33-96824), filed with the Commission on September 12,
                  1995)

         10.9     Transfer Agency Agreement - ND Insured Income Fund, Inc.
                  (incorporated by reference to Exhibit 10.9 contained in the
                  Company's Registration Statement on Form S-1, as amended (File
                  No. 33-96824), filed with the Commission on September 12,
                  1995)

         10.10    Transfer Agency Agreement - Integrity Fund of Funds, Inc.
                  (incorporated by reference to Exhibit 10.10 contained in the
                  Company's Registration Statement on Form S-1, as amended (File
                  No. 33-96824), filed with the Commission on September 12,
                  1995)

         10.11    Distribution Agreement - ND Tax-Free Fund, Inc.
                  (incorporated by reference to Exhibit 10.11 contained in the
                  Company's Registration Statement on Form S-1, as amended (File
                  No. 33-96824), filed with the Commission on September 12,
                  1995)

         10.12    Distribution Agreement - Montana Tax-Free Fund, Inc.
                  (incorporated by reference to Exhibit 10.12 contained in the
                  Company's Registration Statement on Form S-1, as amended (File
                  No. 33-96824), filed with the Commission on September 12,
                  1995)

         10.13    Distribution Agreement - South Dakota Tax-Free Fund, Inc.
                  (incorporated by reference to Exhibit 10.13 contained in the
                  Company's Registration Statement on Form S-1, as amended (File
                  No. 33-96824), filed with the Commission on September 12,
                  1995)

         10.14    Distribution Agreement - ND Insured Income Fund, Inc.
                  (incorporated by reference to Exhibit 10.14 contained in the
                  Company's Registration Statement on Form S-1, as amended (File
                  No. 33-96824), filed with the Commission on September 12,
                  1995)

                                    12

<PAGE>

         10.15    Distribution Agreement - Integrity Fund of Funds, Inc.
                  (incorporated by reference to Exhibit 10.15 contained in the
                  Company's Registration Statement on Form S-1, as amended (File
                  No. 33-96824), filed with the Commission on September 12,
                  1995)

         10.16    Stock Purchase Agreement - ND Holdings, Inc. and
                  Shareholders of Ranson Company, Inc. (incorporated by
                  reference to Exhibit 10.15 contained in the Company's
                  Registration Statement on Form S-1 Amendment No. 1, as amended
                  (File No. 33-96824), filed with the Commission on September
                  12, 1995)

         13.1(1)  1996 Annual Report to Shareholders for year ended December
                  31, 1996

         13.2(1)  Proxy Statement for Annual Meeting of Shareholders to be
                  held May 9, 1997

         21.1     Subsidiaries of the Company:  Reference is made to "Business
                  of the Company" for description of the Company's Subsidiaries,
                  ND Capital, Inc. ND Money Management, Inc. and ND Resources,
                  Inc., The Ranson Company, Inc. and Ranson Capital Corporation
                  (incorporated by reference to Exhibit 21.1 contained in the
                  Company's Registration Statement on Form S-1 Amendment No. 1,
                  as amended (File No. 33-96824), filed with the Commission on
                  December 7, 1995)

         23.1     Consent of Brady Martz & Associates, P.C. (included on page 18
                  of this report)

         24.1     Power of Attorney (included on page 14 of this report)

         27       Financial Data Schedule (included on page 19 of this
                  report)

                                     
(1)  Except to the extent that portions of this exhibit are incorporated
     herein by reference, this document shall not be deemed to have been
     filed pursuant to the Securities Act of 1934, as amended.

13 (b)            Reports on Form 8-K.

A report on Form 8-K dated January 19, 1996 was filed with respect to
the acquisition of The Ranson Company, Inc. which occurred on January 5,
1996.  Financial statements required to be filed with such Form 8-K,
including appropriate audited financial statements of The Ranson
Company, Inc. and interim pro forma financial statements as of September
30, 1995, were timely filed with Form 8-K/A on February 8, 1996.

                                    13

<PAGE>

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 of the undersigned, thereunto duly authorized in
Minot, North Dakota, on this 15th day of April, 1997.

                                     ND HOLDINGS, INC.

                                     By:  s/Robert E. Walstad
                                        Robert E. Walstad
                                        Chief Executive Officer
                                        and President

                           POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Robert E. Walstad his attorney-
in-fact, with the power of substitution for him in any and all
capacities, to sign any amendments to this Report on Form 10-KSB, and to
file the same, with exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission, hereby ratifying
and confirming all that said attorney-in-fact, or his substitute or
substitutes, may do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of
the Registrant in the capacities and on the dates indicated.

       Signatures                 Title                     Date

                         Director, Chief Executive
                           Officer, and President
s/Robert E. Walstad    (Principal Executive Officer)    April 15, 1997
Robert E. Walstad
                                 Treasurer
                     (Principal Financial Officer and
s/Dan Korgel           Principal Accounting Officer)    April 15, 1997
Dan Korgel
                                Director and 
s/Peter A. Quist               Vice President           April 15, 1997
Peter A. Quist

s/Lyle E. McLain                  Director              April 15, 1997
Lyle E. McLain

s/Vance A. Castleman              Director              April 15, 1997
Vance A. Castleman

s/Richard J. Backes               Director              April 15, 1997
Richard J. Backes

s/Richard H. Walstad              Director              April 15, 1997
Richard H. Walstad

                                    14

<PAGE>

                               EXHIBIT INDEX

                                                            Sequential
Number                 Description                           Page No. 
______   _______________________________________________    __________

 3.1     Articles of Incorporation of the Company
         (incorporated by reference to Exhibit 3.1
         contained in the Company's Registration
         Statement on Form S-1, as amended (File No.
         33-96824), filed with the Commission on
         September 12, 1995)                                   N/A

 3.2     Bylaws of the Company (incorporated by reference
         to Exhibit 3.2 contained in the Company's
         Registration Statement on Form S-1, as amended
         (File No. 33-96824), filed with the Commission on
         September 12, 1995).                                  N/A

 4.1     Specimen form of Common Stock Certificate
         (incorporated by reference to Exhibit 4.1 contained
         in the Company's Registration Statement on Form S-1,
         as amended (File No. 33-96824), filed with the
         Commission on September 12, 1995).                    N/A

 4.2     Instruments defining rights of holders of
         securities: See Exhibit 3.1.                          N/A

10.1     Management Advisory Contract - ND Tax-Free Fund,
         Inc. (incorporated by reference to Exhibit 10.1
         contained in the Company's Registration Statement
         on Form S-1, as amended (File No. 33-96824), filed
         with the Commission on September 12, 1995)            N/A

10.2     Management Advisory Contract - Montana Tax-Free
         Fund, Inc. (incorporated by reference to Exhibit 
         10.2 contained in the Company's Registration
         Statement on Form S-1, as amended (File No.
         33-96824), filed with the Commission on September
         12, 1995)                                             N/A

10.3     Management Advisory Contract - South Dakota
         Tax-Free Fund, Inc. (incorporated by reference to
         Exhibit 10.3 contained in the Company's Registration
         Statement on Form S-1, as amended (File No.
         33-96824), filed with the Commission on September
         12, 1995)                                             N/A

10.4     Management Advisory Contract - ND Insured Income
         Fund, Inc. (incorporated by reference to Exhibit
         10.4 contained in the Company's Registration
         Statement on Form S-1, as amended (File No.
         33-96824), filed with the Commission on September
         12, 1995)                                             N/A

10.5     Management Advisory Contract - Integrity Fund of
         Funds, Inc. (incorporated by reference to Exhibit
         10.5 contained in the Company's Registration
         Statement on Form S-1, as amended (File No.
         33-96824), filed with the Commission on September
         12, 1995)                                             N/A

                                   15

<PAGE>

                                                             Sequential
Number                   Description                           Page No. 
______   _________________________________________________   ___________

10.6     Transfer Agency Agreement - ND Tax-Free Fund, Inc.
         (incorporated by reference to Exhibit 10.6
         contained in the Company's Registration Statement
         on Form S-1, as amended, File No. 33-96824),
         filed with the Commission on September 12, 1995)        N/A

10.7     Transfer Agency Agreement - Montana Tax-Free Fund,
         Inc. (incorporated by reference to Exhibit 10.7
         contained in the Company's Registration Statement
         on Form S-1, as amended (File No. 33-96824),
         filed with the Commission on September 12, 1995)        N/A

10.8     Transfer Agency Agreement - South Dakota Tax-Free
         Fund, Inc. (incorporated by reference to Exhibit
         10.8 contained in the Company's Registration
         Statement on Form S-1, as amended (File No.
         33-96824), filed with the Commission on September
         12, 1995)                                               N/A

10.9     Transfer Agency Agreement - ND Insured Income Fund,
         Inc. (incorporated by reference to Exhibit 10.9
         contained in the Company's Registration Statement
         on Form S-1, as amended (File No. 33-96824), filed
         with the Commission on September 12, 1995)              N/A

10.10    Transfer Agency Agreement - Integrity Fund of Funds,
         Inc. (incorporated by reference to Exhibit 10.10
         contained in the Company's Registration Statement
         on Form S-1, as amended (File No. 33-96824), filed
         with the Commission on September 12, 1995)              N/A

10.11    Distribution Agreement - ND Tax-Free Fund, Inc.
         (incorporated by reference to Exhibit 10.11
         contained in the Company's Registration Statement 
         on Form S-1, as amended (File No. 33-96824), filed
         with the Commission on September 12, 1995)               N/A

10.12    Distribution Agreement - Montana Tax-Free Fund,
         Inc. (incorporated by reference to Exhibit 10.12
         contained in the Company's Registration Statement
         on Form S-1, as amended (File No. 33-96824), filed
         with the Commission on September 12, 1995)               N/A

10.13    Distribution Agreement - South Dakota Tax-Free Fund,
         Inc. (incorporated by reference to Exhibit 10.13
         contained in the Company's Registration Statement
         on Form S-1, as amended (File No. 33-96824), filed
         with the Commission on September 12, 1995)               N/A

                                    16

<PAGE>

                                                             Sequential
Number                      Description                       Page No. 
______   _________________________________________________   __________

10.14    Distribution Agreement - ND Insured Income Fund,
         Inc. (incorporated by reference to Exhibit 10.14
         contained in the Company's Registration Statement
         on Form S-1, as amended (File No. 33-96824), filed
         with the Commission on September 12, 1995)              N/A

10.15    Distribution Agreement - Integrity Fund of Funds,
         Inc. (incorporated by reference to Exhibit 10.15
         contained in the Company's Registration Statement
         on Form S-1, as amended (File No. 33-96824), filed
         with the Commission on September 12, 1995)              N/A

10.16    Stock Purchase Agreement - ND Holdings, Inc. and
         Shareholders of Ranson Company, Inc. (incorporated
         by reference to Exhibit 10.15 contained in the
         Company's Registration Statement on Form S-1
         Amendment No. 1, as amended (File No. 33-96824),
         filed with the Commission on September 12, 1995)        N/A

13.1(1)  1996 Annual Report to Shareholders                      N/A

13.2(1)  Proxy Statement for Annual Meeting of Shareholders
         to be held May 9, 1997                                  N/A

21.1     Subsidiaries of the Company:  Reference is made
         to "Business of the Company" for description of
         the Company's Subsidiaries, ND Capital, Inc.
         ND Money Management, Inc. and ND Resources, Inc.,
         The Ranson Company, Inc. and Ranson Capital
         Corporation (incorporated by reference to Exhibit
         21.1 contained in the Company's Registration 
         Statement on Form S-1 Amendment No. 1, as amended 
         (File No. 33-96824), filed with the Commission on 
         December 7, 1995)                                       N/A

23.1     Consent of Brady Martz & Associates, P.C.                18

24.1     Power of Attorney                                       N/A

27       Financial Data Schedule                                  19

                                     
(1)  Except to the extent that portions of this exhibit are incorporated
     herein by reference, this document shall not be deemed to have been
     filed pursuant to the Securities Act of 1934, as amended.