UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

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

For the quarterly period ended: June 30, 1999    Commission file number: 0-20167

                       NORTH COUNTRY FINANCIAL CORPORATION
             (Exact name of registrant as specified in its charter)

              MICHIGAN                                 38-2062816
   (State or other jurisdiction of          (I.R.S. Employer Identification No.)
    incorporation or organization)

   130 S. CEDAR STREET, MANISTIQUE, MI                   49854
(Address of principal executive offices)               (Zip Code)

Registrant's telephone number, including area code:  (906) 341-8401


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 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 _____


As of July 31, 1999, there were outstanding 7,020,520 shares of the registrant's
common stock, no par value.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION
                                      INDEX



PART 1.   FINANCIAL INFORMATION                                         Page No.

   Item 1.  Financial Statements

          Condensed Consolidated Balance Sheets -
            June 30, 1999 (Unaudited) and December 31, 1998................    1

          Condensed Consolidated Statements of Income - Three and
            Six Months Ended June 30, 1999 (Unaudited) and
            June 30, 1998 (Unaudited)......................................    2

          Condensed Consolidated Statements of Changes in Shareholders'
            Equity - Three and Six Months Ended June 30, 1999
            (Unaudited) and June 30, 1998 (Unaudited)......................    3

          Condensed Consolidated Statements of Cash Flows -
            Six Months Ended June 30, 1999 (Unaudited) and
            June 30, 1998 (Unaudited)......................................    4

          Notes to Condensed Consolidated Financial
            Statements (Unaudited).........................................  5-7


   Item 2.  Management's Discussion and Analysis of Financial
              Condition and Results of Operations.......................... 8-13

   Item 3.  Quantitative and Qualitative Disclosures about Market Risk......  14


PART II.  OTHER INFORMATION

   Item 1.  Legal Proceedings...............................................  15

   Item 2.  Changes in Securities and Use of Proceeds.......................  15

   Item 3.  Defaults upon Senior Securities.................................  15

   Item 4.  Submission of Matters to a Vote of Security Holders.............  15

   Item 5.  Other Information...............................................  15

   Item 6.  Exhibits and Reports on Form 8-K................................  15

   SIGNATURES   ............................................................  16
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION

                      CONDENSED CONSOLIDATED BALANCE SHEETS
                            (In thousands of dollars)
<TABLE>

                                                                                          June 30,       December 31,
                                                                                            1999             1998
                                                                                         (Unaudited)
<S>                                                                                     <C>             <C>
ASSETS
     Cash and due from banks                                                            $    29,787     $    16,593
     Federal funds sold                                                                      23,432           6,048
                                                                                        -----------     -----------
         Total cash and cash equivalents                                                     53,219          22,641

     Securities available for sale                                                           12,286           8,565
     Federal Home Loan Bank stock                                                             3,034           3,034

     Total loans                                                                            427,089         411,720
         Allowance for loan losses                                                           (6,160)         (6,112)
                                                                                        -----------     -----------
                                                                                            420,929         405,608
     Premises and equipment                                                                  18,879          17,938
     Other assets                                                                            14,564          13,595
                                                                                        -----------     -----------

         Total assets                                                                   $   522,911     $   471,381
                                                                                        ===========     ===========

LIABILITIES AND SHAREHOLDERS' EQUITY
     Deposits
         Noninterest-bearing                                                            $    41,701     $    42,077
         Interest-bearing                                                                   406,321         362,885
                                                                                        -----------     -----------
              Total deposits                                                                448,022         404,962
     Other borrowings                                                                        19,209          23,270
     Accrued expenses and other liabilities                                                   4,195           3,680
                                                                                        -----------     -----------
         Total liabilities                                                                  471,476         431,912

     Guaranteed preferred beneficial interests in the Corporation's
       subordinated debentures                                                               12,450               0
                                                                                        -----------     -----------

Shareholders' equity
     Preferred  stock,  no par  value,  500,000  shares  authorized,  no  shares
     outstanding Common stock, no par value, 18,000,000 shares authorized,
       7,025,437 and 7,130,760 issued and outstanding at
       June 30, 1999 and December 31, 1998                                                   16,913          19,436
     Retained earnings                                                                       22,197          19,989
     Accumulated other comprehensive income, net                                                (75)             44
                                                                                        -----------     -----------
         Total shareholders' equity                                                          39,035          39,469
                                                                                        -----------     -----------

              Total liabilities and shareholders' equity                                $   522,911     $   471,381
                                                                                        ===========     ===========
</TABLE>

     See accompanying notes to condensed consolidated financial statements.

                                                                              1.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION

                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                (In thousands of dollars, except per share data)
                                   (Unaudited)
<TABLE>
                                                             Three months ended             Six months ended
                                                         --------June 30,----------   ---------June 30,---------
                                                             1999           1998          1999           1998
                                                             ----           ----          ----           ----
<S>                                                       <C>            <C>           <C>             <C>
Interest income
     Loans, including fees                                $  9,896       $  9,489      $  19,345       $  18,350
     Securities
         Taxable                                               167            178            353             397
         Exempt from federal taxation                           10              3             29               4
     Other                                                     114            145            192             247
                                                          --------       --------      ---------       ---------
                                                            10,187          9,815         19,919          18,998

Interest expense
     Deposits                                                4,445          4,096          8,675           8,073
     Other borrowings                                          472            317            864             593
                                                          --------       --------      ---------       ---------
                                                             4,917          4,413          9,539           8,666
                                                          --------       --------      ---------       ---------

Net interest income                                          5,270          5,402         10,380          10,332

Provision for loan losses                                      213            425            426             675
                                                          --------       --------      ---------       ---------

Net interest income after provision for loan losses          5,057          4,977          9,954           9,657

Noninterest income
     Service charges on deposit accounts                       469            401            892             710
     Gain (loss) on sales of loans                             (10)            32             60              55
     Gain on sales of securities                                                                              44
     Other                                                     190            283            312             449
                                                          --------       --------      ---------       ---------
                                                               649            716          1,264           1,258

Noninterest expense
     Salaries and employee benefits                          1,530          1,568          3,002           3,208
     Occupancy and equipment                                   622            598          1,252           1,166
     Other                                                   2,015          1,830          3,349           3,280
                                                          --------       --------      ---------       ---------
                                                             4,167          3,996          7,603           7,654
                                                          --------       --------      ---------       ---------

Income before income tax expense                             1,539          1,697          3,615           3,261

Income tax expense                                             232            380            767             794
                                                          --------       --------      ---------       ---------

Net income                                                $  1,307       $  1,317      $   2,848       $   2,467
                                                          ========       ========      =========       =========

Basic earnings per common share                           $    .19       $    .18      $     .40       $     .35
                                                          ========       ========      =========       =========

Diluted earnings per common share                         $    .18       $    .18      $     .40       $     .35
                                                          ========       ========      =========       =========

Dividends paid per common share                           $    .05       $    .04      $     .09       $     .09
                                                          ========       ========      =========       =========
</TABLE>

     See accompanying notes to condensed consolidated financial statements.

                                                                              2.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION

      CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
                            (In thousands of dollars)
                                   (Unaudited)
<TABLE>
                                                              Three months ended             Six months ended
                                                          ---------June 30,----------    ---------June 30,-------
                                                             1999           1998            1999            1998
                                                             ----           ----            ----            ----
<S>                                                        <C>            <C>            <C>             <C>
Balance - beginning of period                              $  38,214      $  37,471      $  39,469       $  36,589

Net income for period                                          1,307          1,317          2,848           2,467
Net change in net unrealized gain on securities
  available for sale                                             (78)            (5)          (119)             (5)
                                                           ---------      ---------      ---------       ---------
     Total comprehensive income                                1,229          1,312          2,729           2,462

Cash dividends                                                  (319)          (312)          (640)           (620)

Issuance of common stock                                         111            129            204             281

Common stock retired                                            (200)          (840)        (2,727)           (952)
                                                           ---------      ---------      ---------       ---------

Balance - end of period                                    $  39,035      $  37,760      $  39,035       $  37,760
                                                           =========      =========      =========       =========
</TABLE>




     See accompanying notes to condensed consolidated financial statements.

                                                                              3.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                            (In thousands of dollars)
                                   (Unaudited)
<TABLE>
                                                                                              Six months ended
                                                                                            ------June 30,------
                                                                                            1999            1998
                                                                                            ----            ----
<S>                                                                                       <C>             <C>
Cash flows from operating activities
     Net income                                                                           $   2,848       $   2,467
     Adjustments to reconcile net income to
       net cash from operating activities
         Depreciation and amortization                                                        1,018           1,023
         Provision for loan losses                                                              426             675
         Gain on sales of securities                                                                            (44)
         Change in other assets                                                                 963           2,140
         Change in other liabilities                                                            569             177
                                                                                          ---------       ---------
              Net cash from operating activities                                              5,824           6,438

Cash flows from investing activities
     Purchase of securities available for sale                                               (6,302)         (4,000)
     Proceeds from sales of securities available for sale                                                       752
     Proceeds from maturities, calls or paydowns of securities available for sale             2,389           1,000
     Net increase in loans                                                                  (15,747)        (11,458)
     Purchase of premises and equipment                                                      (1,345)         (1,626)
     Net cash received for net liabilities assumed in acquisition of branches                15,504
                                                                                          ---------       ---------
         Net cash from investing activities                                                  (5,501)        (15,332)

Cash flows from financial activities
     Net increase in deposits                                                                25,597          14,338
     Proceeds from other borrowings                                                           8,000           8,235
     Payment on other borrowings                                                            (12,061)           (787)
     Proceeds from issuance of common stock                                                     204             281
     Retirement of common stock                                                              (2,727)           (952)
     Net proceeds from the issuance of guaranteed preferred beneficial
       interests in the Corporation's subordinated debentures                                11,882
     Payment of cash dividends                                                                 (640)           (620)
                                                                                          ---------       ---------
         Net cash from financing activities                                                  30,255          20,495
                                                                                          ---------       ---------

Net change in cash and cash equivalents                                                      30,578          11,601

Cash and cash equivalents at beginning of period                                             22,641          11,143
                                                                                          ---------       ---------

Cash and cash equivalents at end of period                                                   53,219       $  22,744
                                                                                          =========       =========

Supplemental  disclosures of cash flow information  Increases  related to branch
     acquisitions:
         Premises and equipment, net                                                      $    (286)
         Core deposit intangibles and goodwill                                               (1,680)
         Deposits                                                                            17,463
         Other liabilities                                                                        7
</TABLE>

     See accompanying notes to condensed consolidated financial statements.

                                                                              4.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  (Unaudited)



1.   BASIS OF PRESENTATION

     The unaudited condensed  consolidated financial statements of North Country
     Financial  Corporation  (the  Registrant)  have been prepared in accordance
     with  generally  accepted  accounting   principles  for  interim  financial
     information and the  instructions to Form 10-Q and Rule 10-01 of Regulation
     S-X. Accordingly,  they do not include all of the information and footnotes
     required by generally accepted accounting principles for complete financial
     statements.  In the opinion of management,  all adjustments  (consisting of
     normal recurring  accruals)  considered  necessary for a fair  presentation
     have been included.  Operating  results for the six-month period ended June
     30, 1999 are not necessarily indicative of the results that may be expected
     for the year ending December 31, 1999. The unaudited consolidated financial
     statements and footnotes  thereto  should be read in  conjunction  with the
     audited consolidated financial statements and footnotes thereto included in
     the Registrant's  Annual Report on Form 10- for the year ended December 31,
     1998.


2.   FUTURE ACCOUNTING CHANGES

     In June 1998, the Financial  Accounting  Standards  Board  ("FASB")  issued
     Statement of Financial  Accounting  Standards ("FAS") No. 133,  "Accounting
     for Derivative Instruments and Hedging Activities". This Statement requires
     that all derivative financial instruments be recognized as either assets or
     liabilities  in the Balance Sheet.  Derivative  financial  instruments  not
     designated  as hedges will be  measured at fair value with  changes in fair
     value being recognized in earnings in the period of change. If a derivative
     is designated  as a hedge,  the  accounting  for changes in fair value will
     depend on the specific  exposure  being hedged.  The Statement is effective
     for fiscal years beginning after June 15, 1999.  Management,  at this time,
     cannot  determine  the effect  adoption of this  Statement  may have on the
     consolidated  financial  statements  of the  Registrant  as the  effect  is
     dependent  on the amount and nature of  derivatives  and hedges held at the
     time of adoption of the Statement.


3.   EARNINGS PER SHARE

     The factors used in the earnings per share computation follow.
<TABLE>
         (In thousands, except per share data)
                                                                                  Three months       Six months
                                                                                      ended             ended
                                                                                  June 30, 1999     June 30, 1999
     <S>                                                                           <C>               <C>
     Basic earnings per common share:
         Net income                                                                $    1,307        $    2,848
         Weighted average common shares outstanding                                     7,031             7,052
                                                                                   ----------        ----------
           Basic earnings per common share                                         $      .19        $      .40
                                                                                   ==========        ==========

     Diluted earnings per common share:
       Net income                                                                  $    1,307        $    2,848

       Weighted average common shares outstanding
         for basic earnings per common share                                            7,031             7,052
       Add:  Dilutive effect of assumed exercises
         of stock options                                                                  91               101
       Add:  Dilutive effect of directors' deferred stock
         compensation                                                                       7                 7
                                                                                   ----------        ----------
         Average shares and dilutive potential common shares                            7,129             7,160
                                                                                   ----------        ----------
           Diluted earnings per common share                                       $      .18        $      .40
                                                                                   ==========        ==========
</TABLE>

                                   (Continued)
                                                                              5.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  (Unaudited)



3.   EARNINGS PER SHARE (Continued)

     For the quarter and six months  ended June 30, 1998,  the weighted  average
     common shares  outstanding  used in the  computations  of basic and diluted
     earnings   per  share   were   approximately   7,127,000   and   7,134,000,
     respectively.  The assumed  exercise of stock  options and  deferred  stock
     compensation  for the  quarter  and six months  ended June 30, 1998 did not
     have a dilutive effect on these calculations.

     All share and per share  amounts  in this  filing  have been  retroactively
     adjusted to reflect the August of 1998 3-for-1 split.


4.   ALLOWANCE FOR LOAN LOSSES

     Activity in the allowance for loan losses for the six months ended June 30,
     1999 and 1998, are summarized as follows:
<TABLE>
                                               (In thousands of dollars)
                                                                                        June 30,        June 30,
                                                                                          1999            1998
       <S>                                                                              <C>             <C>
       Balance at beginning of period                                                   $   6,112       $   5,600
       Charge-offs                                                                           (430)           (441)
       Recoveries                                                                              52              50
       Provision for loan losses                                                              426             675
                                                                                        ---------       ---------

                                                                                        $   6,160       $   5,884
                                                                                        =========       =========
</TABLE>
     Information regarding impaired loans follows:
<TABLE>
                                             (In thousands of dollars)
                                                                                        As of and       As of and
                                                                                       for the six    for the year
                                                                                      months ended        ended
                                                                                        June 30,      December 31,
                                                                                          1999            1998
                                                                                          ----            ----
       <S>                                                                            <C>               <C>
       Average investment in impaired loans                                           $     5,421       $     6,155
       Balance of impaired loans                                                            5,493             6,073
</TABLE>



                                   (Continued)

                                                                              6.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  (Unaudited)



5.   OTHER BORROWINGS

     Other borrowings consist of the following at June 30, 1999 and December 31,
     1998:
<TABLE>
                                                                                          June 30,     December 31,
                                                                                            1999           1998
                                                                                         (In thousands of dollars)
<S>                                                                                      <C>           <C>
Federal Home Loan Bank advances at various rates with various
 maturities (see annual financial statements as referenced in
 Note 1)                                                                                $ 17,334       $ 20,607

Farmers Home Administration, $2,000,000 fixed rate line
 agreement maturing August 24, 2024, interest payable at 1%                                1,875          1,875

Notes payable to South Range State Bank's former stockholders,
 maturing in three equal annual installments beginning
 February 1, 1997, interest payable at 5.2%                                                                 788
                                                                                        --------       --------
                                                                                        $ 19,209       $ 23,270
                                                                                        ========       ========
</TABLE>
     The  Federal  Home Loan Bank  borrowings  are  collateralized  by a blanket
     collateral  agreement  on  the  Registrant's  residential  mortgage  loans.
     Prepayment of the advances is subject to the  provisions  and conditions of
     the credit policy of the Federal Home Loan Bank of  Indianapolis  in effect
     as of June 30, 1999.  Borrowings other than Federal Home Loan Bank advances
     are not subject to prepayment penalties.


6.   CURRENT EVENTS

     In May of 1999, the Registrant  acquired  branches in Kaleva and Mancelona,
     Michigan from  Huntington  National Bank. The  transaction is accounted for
     under  the  purchase   method  of  accounting.   The   Registrant   assumed
     approximately  $17.5  million  in  deposits,   and  acquired  approximately
     $286,000 in  premises,  equipment  and sundry  assets,  and $1.7 million of
     intangible assets, as more fully disclosed in the Statement of Cash Flows.

     A  business  trust  subsidiary  of the  Registrant  sold  12,450  of  Trust
     Preferred  Securities  at $1,000 per  preferred  security  in a May of 1999
     offering. The proceeds from the sale of the Trust Preferred Securities were
     used by the  Registrant's  subsidiary to purchase an  equivalent  amount of
     Subordinated  Debentures of the Registrant.  The Trust Preferred Securities
     carry a distribution  floating rate of the 3-month LIBOR plus 2.5%,  have a
     stated  maturity of May 14, 2029,  and are guaranteed by the Registrant The
     securities are redeemable at par after May 14, 2009.  Distributions  on the
     Trust  Preferred  Securities are payable  quarterly on February 14, May 14,
     August 14 and  November 14. The first  distribution  will be paid on August
     14, 1999.

                                                                              7.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION
      ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS


The  following  discussion  and analysis of financial  condition  and results of
operations provides additional  information to assess the condensed consolidated
financial statements of the Registrant and its wholly-owned subsidiaries through
the second quarter of 1999. The  discussion  should be read in conjunction  with
those statements and their accompanying notes.

The Registrant is not aware of any market or institutional  trends,  events,  or
circumstances  that will have or are reasonably likely to have a material effect
on liquidity,  capital  resources,  or results of operations except as discussed
herein.  Also,  the  Registrant is not aware of any current  recommendations  by
regulatory authorities which will have such effect if implemented.


Forward-Looking Statements:

This report contains certain  forward-looking  statements  within the meaning of
Section 27A of the  Securities  Act of 1933, as amended,  and Section 21E of the
Securities  Exchange  Act of 1934,  as  amended.  The  Registrant  intends  such
forward-looking  statements  to be covered  by the safe  harbor  provisions  for
forward-looking  statements  contained in the Private  Securities  Reform Act of
1995,  and is  including  this  statement  for  purposes  of these  safe  harbor
provisions.  Forward-looking statements,  which are based on certain assumptions
and describe future plans,  strategies and  expectations of the Registrant,  are
generally  identifiable  by use  of the  words  "believe",  "expect",  "intend",
"anticipate",  "estimate",  "project" or similar  expressions.  The Registrant's
ability to predict results or the actual effect of future plans or strategies is
inherently uncertain.  Factors which could have a material adverse affect on the
operations and future prospects of the Registrant and the subsidiaries  include,
but are not limited to, changes in: interest rates, general economic conditions,
legislative/regulatory  changes,  monetary  and  fiscal  policies  of  the  U.S.
Government,  including  policies of the U.S.  Treasury  and the Federal  Reserve
Board, the quality or composition of the loan or investment  portfolios,  demand
for loan products, deposit flows, competition,  demand for financial services in
the Registrant's market area and accounting principles, policies and guidelines.
These risks and uncertainties should be considered in evaluating forward-looking
statements and undue reliance should not be placed on such  statements.  Further
information  concerning the Registrant  and its business,  including  additional
factors that could materially  affect the  Registrant's  financial  results,  is
included  in  the   Registrant's   filings  with  the  Securities  and  Exchange
Commission.


Financial Highlights:

Year to date  consolidated  net  income was  $2,848,000  through  June 30,  1999
compared to $2,467,000 for the same period in 1998.  Diluted  earnings per share
increased  from $.35 through June 30, 1998, to $.40 for the same period in 1999.
The loan  portfolio  continues  a  significant  growth  trend with  gross  loans
increasing  $15,369,000  or 3.7% since  December 31, 1998.  Loan growth  remains
focused in the commercial lending and leasing areas. The loan growth in 1999 has
been funded primarily through an increase i the deposit portfolio. Deposits have
increased  $43,060,000  or 10.6% since  December 31,  1998.  The primary area of
deposit growth for the Registrant has been in interest-bearing demand accounts.


Financial Condition:

Loans:  Through the second  quarter of 1999,  loan  balances  increased by $15.4
million.  Management  believes loans provide the most  attractive  earning asset
yield available to the Registrant and that trained personnel and controls are in
place  to  successfully  manage a  growing  portfolio.  Accordingly,  management
intends to  continue to maintain  loans at the highest  level while  maintaining
adequate liquidity. As shown in the table below, the loan mix remains relatively
constant with a slight increase in commercial  loans as a percent of total loans
for the six months ended June 30, 1999 compared to December 31, 1998.

                                                                              8.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION
      ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS


Management is aware of the risk associated with an increase in average  balances
of loans but believes that the current level in the allowance for loan losses is
adequate.  At June 30, 1999 the  allowance for loan losses was equal to 1.44% of
total loans  outstanding  compared to 1.48% at December 31, 1998. The allocation
of the allowance for loan losses  between  portfolio  categories has not changed
significantly since December 31, 1998.

Loans to general  commercial  businesses  increased by $17.6 million through the
second quarter of 1999.  Management continues to focus on loan growth through an
increase in the commercial lending area. A significant  portion of the growth is
due to the  Bank's  continued  ability  to  penetrate  growth  markets  such  as
Marquette and Sault Ste. Marie.

Governmental leases also have increased in the first six months of 1999, up $8.4
million from December 31, 1998. In the second  quarter of 1999,  the  Registrant
formed North Country  Financial  Group,  Inc., which opened an office in Denver,
Colorado,  to further  enhance its  ability to attract  lease  assets.  This new
corporation  will be initially  engaged in the business of public  finance,  and
intends to focus primarily on providing tax-exempt  lease/purchase  financing to
municipalities  located throughout the United States.  Subject to its receipt of
appropriate  licensing,  North  Country  Financial  Group  intends  to engage in
publicly offered certificates of participation,  energy management  transactions
and municipal  infrastructure  financing (such as 911 emergency systems,  water,
sewer and solid waste projects).

The other loan categories have remained fairly  consistent at June 30, 1999 when
compared to December 31, 1998.
<TABLE>
                                                           June 30,       % of          December 31,     % of
                                                             1999         Total             1998         Total
                                                             ----         -----             ----         -----
     <S>                                                 <C>              <C>           <C>              <C>
     Loans
     Commercial real estate                              $   82,891        19.4%        $   82,207        20.0%
     Commercial, financial, and agricultural                154,442        36.2            136,820        33.2
     Leases:
         Commercial                                          13,382         3.1             20,097         4.9
         Governmental                                        48,451        11.3             40,098         9.7
     1-4 family residential real estate                     100,093        23.5             97,415        23.7
     Consumer                                                18,812         4.4             23,160         5.6
     Construction                                             9,018         2.1             11,923         2.9
                                                         ----------       -----         ----------       -----

                                                         $  427,089       100.0%        $  411,720       100.0%
                                                         ==========       =====         ==========       =====
</TABLE>
Credit Quality: Management analyzes the allowance for loan losses in detail on a
monthly  basis to ensure that the losses  inherent in the portfolio are properly
reserved for in the  allowance  for loan  losses.  The  Registrant's  success in
maintaining   excellent   credit  quality  is  demonstrated  in  its  historical
charge-off  percentage.  Net charge-offs to gross loans outstanding was .09% and
 .10% for June 30, 1999 and 1998, respectively.  Charge-offs for the period ended
June 30, 1999  decreased  $11,000  from the same period in 1998  despite  strong
growth  in the  loan  portfolio.  This is  mainly  the  result  of  management's
continued efforts to improve credit quality in such portfolios. Accordingly, the
provision  for loan losses was  decreased  from $675,000 in the six month period
ended June 30, 1998 to $426,000 for the same period in 1999.

The table  presented  below shows the  balance of  non-performing  loans,  which
include nonaccrual loans, loans 90 or more days past due and still accruing, and
renegotiated loans as of June 30, 1999 and December 31, 1998.
<TABLE>
                                             (In thousands of dollars)
                                                                                        June 30,        December 31,
                                                                                          1999              1998
     <S>                                                                              <C>               <C>
     Nonaccrual loans                                                                 $       441       $     2,174
     Loans 90 days or more past due and still accruing                                      1,364             1,238
</TABLE>

                                                                              9.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION
      ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS


While loans 90 days or more past due have  increased  by $126,000 or 10.2% since
December 31, 1998,  nonaccrual  loans have  decreased  by  $1,733,000  or 79.7%.
Management  is actively  managing the current loan  delinquencies  and has taken
various  actions to reduce  the level of  non-performing  loans.  Non-performing
loans to total gross loans were .42% and .83% at June 30, 1999 and  December 31,
1998, respectively.

Investments:  Available for sale securities increased  approximately  $3,721,000
through the second quarter of 1999 mainly due to the purchase of mortgage-backed
securities. The mix of the portfolio remained relatively unchanged from December
31, 1998.  The primary use of the  portfolio is to provide a source of liquidity
and pledging for certain repurchase agreements and regulatory requirements. Most
of the portfolio is invested in U.S.  Treasury and agency  securities which have
little credit risk and are highly liquid. There are no securities  classified as
held to maturity.

Deposits:  Total  deposits  through  the second  quarter  have  increased  $43.1
million.  Interest  bearing deposit  balances  increased  through June 30, 1999,
continuing a trend from 1998.  $17.5  million of the increase in total  deposits
was the result of the branch  acquisitions during the second quarter of 1999, as
more  fully  disclosed  in the  Notes to the  Condensed  Consolidated  Financial
Statements,  contained  herein.  The  remaining  growth has come from the branch
network, as management has continued to offer attractive deposit products to its
customers,  generally through premium-based  certificate of deposit programs and
higher yielding savings accounts.

Borrowings:  The Registrants branching network is a relatively high cost network
in comparison to peers.  Accordingly,  the Registrant uses  alternative  funding
sources to provide funds for lending activities.  Other borrowings  decreased by
$4.1 million through the second quarter of 1999 (refer to the table presented in
Note 5 to the second quarter  financial  statements above for the composition of
the decrease). At June 30, 1999, $17.3 million of the total borrowings were from
the Federal Home Loan Bank of Indianapolis.  Alternative  sources of funding can
be obtained at interest rates which are competitive  with, or lower than, retail
deposit rates and with minimal administrative costs.

Guaranteed  Preferred  Beneficial  Interests in the  Corporation's  Subordinated
Debentures:  Consistent  with the  Registrant's  Strategic  Plan, the Registrant
completed  a private  offering in May of 1999 of  Capital,  or Trust  Preferred,
securities  in the amount of  $12,450,000.  Such amounts will be used to support
the  Registrant's  current  capital  position  allowing  for  future  growth and
increased common shareholder value. Under regulatory guidelines, such securities
are eligible as regulatory capital, as defined, subject to certain limitations.

Shareholder's  Equity:  Total shareholder's  equity decreased  approximately $.4
million from December 31, 1998 to June 30, 1999. The decrease primarily resulted
from the  repurchase of common stock of $2.7 million and cash  dividends paid of
$.6 million,  offset by net income of $2.8 million. The Registrant will continue
to  selectively  repurchase  common stock as  opportunities  arise,  to maximize
return to its common shareholders.


Results of Operations:

Net Interest  Income:  Net interest  income for the quarter  ended June 30, 1999
decreased  by 2.4%  compared to the same period one year ago.  The net  interest
margin, on a fully taxable  equivalent basis for the quarter ended June 30, 1999
was 4.76%,  compared to 5.42% for the same period of 1998.  The  decrease in the
net interest  margin has been impacted by the low interest rate  environment and
the competitive  nature of the Registrant's  market.  Interest income from loans
represented  97.1% of total  interest  income  for the  second  quarter  of 1999
compared to 96.7% for the same period of 1998. In all cases, the total amount of
interest income and the yield on total earning assets is strongly  influenced by
lending activities.

Net  interest  income for the six months  ended June 30, 1999  increased  by .5%
compared to the same period in 1998. The net interest margin, on a fully taxable
equivalent basis for the six months ended June 30, 1999 decreased from 5.21% for
the same period in 1998 to 4.75% for the same reasons mentioned in the preceding
paragraph. Interest income from loans represented 97.1% of total interest income
through  the second  quarter of 1999  compared  to 96.6% for the same  period of
1998.

                                                                             10.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION
      ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS


Provision  for Loan Losses:  The  Registrant  maintains  the  allowance for loan
losses at a level  adequate  to cover  losses  inherent  in the  portfolio.  The
Registrant  records a  provision  for loan  losses  necessary  to  maintain  the
allowance at that level after  considering  factors such as loan charge-offs and
recoveries, changes in the mix of loans in the portfolio, loan growth, and other
economic  factors.  The provision for loan losses  decreased by $212,000 for the
three  months ended June 30, 1999 and $249,000 for the six months ended June 30,
1999  compared  to the  same  periods  in 1998 as a result  of the  Registrant's
favorable net charge-off and non-performing loan trends. Management continues to
fund the allowance at a rate consistent with loan growth. The allowance for loan
losses to gross  loans was 1.44%  and 1.48% at June 30,  1999 and  December  31,
1998, respectively.

Noninterest Income: Noninterest income decreased by $67,000 for the three months
ended June 30,  1999  compared  to the same  period in 1998.  The  decrease  was
primarily due to a decrease in other noninterest income of $93,000,  largely the
result of reduced  insurance  commissions,  and a decrease  in gains on sales of
loans of $42,000. These reductions were offset by an increase in service charges
on deposit accounts of $68,000.

Noninterest income remained  relatively  unchanged for the six months ended June
30,  1999  compared  to the same  period one year ago.  An  increase  in service
charges  on deposit  accounts  of  $182,000  was  offset by  decreases  in other
noninterest income of $137,000 and gain on sales of securities of $44,000. As in
the second quarter of 1999, the decrease in other noninterest  income was mainly
due to a reduction  in insurance  premiums.  There were no  securities  gains or
losses through the second quarter of 1999.

Noninterest  Expenses:  Noninterest  expense  increased  $171,000  for the three
months  ended  June 30,  1999  compared  to the same  period of 1998.  A primary
objective of management  is to hold the rate of increase in this category  below
future asset  growth.  Salary  expense  decreased  by $38,000  during the second
quarter  of  1999  compared  to the  second  quarter  of 1998  largely  due to a
reduction in  staffing.  Occupancy  expense  increased by $24,000 for the second
quarter of 1999 compared to the same period in 1998. Other  noninterest  expense
increased by $185,000 for the second quarter of 1999 compared to the same period
in 1998. This increase is mainly due to an increase in professional fees related
to data processing.

Noninterest  expense  decreased  $51,000 for the six months  ended June 30, 1999
compared  to the same  period of 1998.  Management  believes  this  decrease  is
attributable to significant  efficiencies  obtained in operational  areas of the
Bank based on a heightened  level of  management  emphasis in this area.  Salary
expense decreased by $206,000 through the second quarter of 1999 compared to the
same period of 1998 for the same reasons noted in the preceding paragraph.  This
decrease  was offset by  increases  in  occupancy  expense of $86,000  and other
noninterest  expense of $69,000 for the six months ended June 30, 1999  compared
to same period of 1998.

Federal  Income Tax: The  provision  for income taxes was 15.1% of income before
income tax for the quarter ended June 30, 1999 compared to 22.4% for the quarter
ended June 30, 1998.  For the six months ended June 30, 1999,  the provision for
income taxes was 21.2% of income  compared to 24.3% for the same period in 1998.
The difference  between the effective tax rate and the federal  corporate income
tax rate of 34% is primarily due to tax-exempt interest earned on loans, leases,
and investments.  The effective tax rate has decreased as tax-exempt  income has
become a larger percentage of total interest income.


Interest Rate Risk:

Management  actively manages the Registrant's  interest rate risk. In relatively
low  interest  rate  environments  which  have been in place the last few years,
borrowers have generally tried to extend the maturities and repricing periods on
their loans and place deposits in demand or very short term accounts. Management
has taken various actions to offset the imbalance which those  tendencies  would
otherwise create. Commercial and real estate loans are written at variable rates
or, if necessary,  fixed rates for  relatively  short terms.  Products have also
been offered to give  customers an  incentive  to accept  longer term  deposits.
Management  can also  manage  interest  rate risk with the  maturity  periods of
securities purchased, selling securities available for sale, and borrowing funds
with targeted maturity periods.

                                                                             11.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION
      ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS


As of June 30, 1999, the  Registrant had a cumulative  liability gap position of
$64,695,000  within the one-year  timeframe.  This position suggests that if the
market  interest  rates decline in the next 12 months,  the  Registrant  has the
potential to earn more net interest income. Conversely, if market interest rates
increase in the next 12 months,  the  Registrant  has the potential to earn less
net interest income.  Management believes that it is properly positioned against
significant changes in rates withou severely altering operating results.


Liquidity:

The Registrants  sources of liquidity  include  principal  payments on loans and
investments,  sales of securities  available for sale,  deposits from customers,
borrowings  from the  Federal  Home Loan Bank,  other bank  borrowings,  and the
issuance of common stock. The Registrant has ready access to significant sources
of liquidity on an almost immediate basis.  Management anticipates no difficulty
in  maintaining  liquidity at the levels  necessary  to conduct the  Registrants
day-to-day business activities.


Capital Resources:

It is the policy of the  Registrant  to maintain  capital at a level  consistent
with  both  safe and  sound  operations  and  proper  leverage  to  generate  an
appropriate return on shareholders' equity. The capital ratios of the Registrant
exceed the regulatory minimum guidelines. The table below shows a summary of the
Registrant's capital position in comparison to regulatory requirements.

<TABLE>
                                                              Tier 1         Total
                                                           Risk-Based     Risk-Based
                                             Leverage        Capital        Capital
                                              Ratio           Ratio          Ratio
     <S>                                     <C>           <C>            <C>
     Regulatory minimum                      4.0%           4.0%           8.0%

     The Registrant
         June 30, 1999                       8.9           12.0           13.7
         December 31, 1998                   7.2            9.4           10.7
</TABLE>
The capital levels as of June 30, 1999 include  adjustment  for the Capital,  or
Trust  Preferred,   Securities  issued  in  May  of  1999,  subject  to  certain
limitations. Federal Reserve guidelines limit the amount of cumulative preferred
securities  which  can be  included  in Tier 1  capital  to 25% of total  Tier 1
capital.  As of June 30, 1999,  approximately  $11,000,000 of the $12,450,000 of
Capital  Securities  were included as Tier 1 capital of the Registrant  with the
remaining  $1,450,000 included as Tier 2 capital,  component of total risk-based
capital. As previously noted, the Capital Securities will be used to support the
Registrant's  current capital position  allowing for future growth and increased
common shareholder value.

Recent Developments:

On July 23,  1999,  the  Registrant  sold two of its branch  offices  located in
Rudyard and  Cedarville in Michigan's  Upper  Peninsula  with total  deposits of
approximately  $20 million.  These branch  dispositions  are consistent with the
Registrant's  strategy  of  improving  operating  efficiency  by  maintaining  a
presence  only in  locations  such as  commercial  centers  where it can operate
profitably.

                                                                             12.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION
      ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS


Year 2000 Issue:

The  regulators  continue to monitor  closely the Year 2000 efforts of financial
institutions.  Regulators have conducted their quarterly reviews,  which look at
the  overall  progress  that a financial  institution  has made in its Year 2000
efforts  as  well  as  to  review  their  compliance  with  federally   mandated
requirements.  Examiners check to see that financial institutions are performing
ongoing  system  renovation  and  testing  that  may  be  needed,   establishing
comprehensive  contingency  plans,  mitigating any identified  Year 2000 related
business  risk, and  effectively  informing  their  customers of their Year 2000
preparations.  In August 1999, The Federal  Financial  Institutions  Examination
Council  issued a  statement  that 99% of  insured  financial  institutions  are
prepared for the Year 2000.

In January 1997, the Registrant began assessing the impact of the century change
associated  with the  failure  to  renovate,  validate,  and  implement  mission
critical systems to ensure Year 2000 (Y2K) readiness. A Y2K Committee made up of
a team of professionals,  representing all disciplines  within the organization,
was  actively   involved  in  the  assessment,   renovation,   validation,   and
implementation of Year 2000 issues.

A Business  Resumption  Contingency  Plan was developed to mitigate  operational
risks  should core  business  processes  fail,  regardless  if  mission-critical
systems were  remediated  for Y2K. All  internal  testing has been  completed in
accordance with the regulatory  requirements and will be periodically  validated
throughout the third and fourth quarter of 1999.

In March 1999, the Registrant engaged Wipfli, Ulrich,  Bertelson,  to perform an
independent  third party review of Year 2000.  The  objective of the third party
review was to provide management with an independent review of the status of the
Registrant's Y2K readiness and to ensure compliance with regulatory requirements
related  to  Year  2000  issues.  Recommendations  from  the  review  have  been
addressed.

There has been no significant  change in the amounts  expended by the Registrant
to ensure Y2K readiness from amounts previously reported.

                                                                             13.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION
       ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


The  Registrant  has not  experienced  any  material  changes to its market risk
position from that disclosed in the Registrant's 1998 Form 10-K Annual Report.






                                                                             14.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION

                           PART II - OTHER INFORMATION


Item 1.  Legal Proceedings.

At the date hereof, there were no material pending legal proceedings, other than
routine  litigation  incidental  to  the  business  of  banking,  to  which  the
Registrant  or  any  of its  subsidiaries  is a  party  of or  which  any of its
properties is the subject.

Item 2.  Changes in Securities and Use of Proceeds.

(b)  On May 14, 1999, the Registrant  issued debentures to North Country Capital
     Trust  ("NCCT"),  a  business  trust  subsidiary  of the  Registrant.  NCCT
     purchased the debentures with the proceeds from the sale of trust preferred
     securities issued by NCCT in a private placement. The Registrant guaranteed
     the  preferred  securities.   The  documents  governing  these  securities,
     including the Indenture  under which the debentures  were issued,  restrict
     the  Registrant's  right to pay a dividend on its commo stock under certain
     circumstances and give the holders of the preferred  securities  preference
     on liquidation over the holders of Registrant's common stock. Specifically,
     the  Registrant  may not declare or pay a cash dividend on its common stock
     if (a) an event of default has  occurred as defined in the  Indenture,  (b)
     the Registrant is in default under its Guarantee, or (c) the Registrant has
     exercised its right under the  debentures  and the preferred  securities to
     extend the interest payment period In addition,  if any of these conditions
     have occurred and until they are cured,  the Registrant is restricted  from
     redeeming  or  purchasing  any shares of its common stock except under very
     limited  circumstances.  The Registrant's  obligation under the debentures,
     the preferred  securities and the Guarantee is $12,450,000 and the interest
     rate is payable  quarterly at a floating  rate equal to 3-month  LIBOR plus
     2.5%.  See  Note  6  of  the  Notes  to  Condensed  Consolidated  Financial
     Statements included in this Report.

Item 3.  Defaults Upon Senior Securities.

There have been no defaults upon senior securities  relevant to the requirements
of this section.

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

The annual meeting of the Registrant's  shareholders was held on April 20, 1999.
The purpose of the meeting was to elect  directors,  each for a three year term.
The name of each  director  elected  (along with the number of votes cast for or
authority withheld) follows:


                                                                      Authority
Directors Elected                         For                         Withheld
-----------------                         ---                         --------

Michael C. Henricksen                     4,590,176                     6,892
John P. Miller                            4,589,972                     7,096
Ronald G. Ford                            4,589,788                     7,280


Item 5.  Other Information.

There are no matters required to be reported under this item.


                                   (Continued)
                                                                             15.
<PAGE>
                       NORTH COUNTRY FINANCIAL CORPORATION

                           PART II - OTHER INFORMATION


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

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

Number                   Exhibit

27                       Financial Data Schedule.  Filed herewith.


The following documents are filed as part of Part I, Item 1 of this report:

         Condensed Consolidated  Balance Sheets - June 30, 1999 (Unaudited)  and
         December 31, 1999
         Condensed  Consolidated  Statements  of Income - Three  and  Six Months
         ended June 30, 1999 and 1998 (Unaudited).
         Condensed Consolidated  Statements of Changes in Shareholders' Equity -
         Three and Six Months ended June 30, 1999 and 1998 (Unaudited) Condensed
         Consolidated  Statements of Cash Flows - Six Months ended June 30, 1999
         and  1998  (Unaudited)  Notes  to  Unaudited   Consolidated   Financial
         Statements - June 30, 1999

(b)      The following  reports on Form 8-K  were filed during the quarter ended
         June 30, 1999.

         During the  quarter the  Registrant  filed a Report on Form 8-K,  dated
         May 14,  1999,  reporting  the  Registrant's  completion  of a  private
         placement  of  $12,450,000   principal   amount  of   trust   preferred
         securities.




                                                                             16.
<PAGE>
                                   SIGNATURES

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

                                        NORTH COUNTRY FINANCIAL CORPORATION
                                                   (Registrant)



8/13/99                                 /s/ Ronald G. Ford
Date                                    RONALD G. FORD, CEO


8/13/99                                 /s/ Sherry Littlejohn
Date                                    SHERRY LITTLEJOHN
                                        PRESIDENT AND COO




                                                                             17.
330813