<PAGE>

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

                                   FORM 10-Q

             X     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
             --
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                  For the quarterly period ended June 30, 2000

                                       OR

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

                         Commission file number 1-7273
                          ______________________________

                            Allfirst Financial Inc.
             (Exact name of registrant as specified in its charter)

             Delaware                                52-0981378
   (State or other jurisdiction of               (I.R.S. Employer
   incorporation or organization)               Identification No.)


     25 South Charles Street
     Baltimore, Maryland                                21201
 (Address of principal executive offices)            (zip code)

                                  410-244-4000
              (Registrant's telephone number, including area code)




   Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for at least the past 90 days.  Yes      No  X

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

   All 597,763 outstanding shares of Common Stock of the registrant are owned by
             Allied Irish Banks, p.l.c., an Irish banking corporation.
<PAGE>

                   ALLFIRST FINANCIAL INC.  AND SUBSIDIARIES

                                   FORM 10-Q

                      FOR THE QUARTER ENDED JUNE 30, 2000

                                     INDEX


<TABLE>
<CAPTION>
                                                                                                 Page No
                                                                                               ------------
Part I.  Financial Information
    Item 1.  Financial Statements (Unaudited)
<S>                                                                                            <C>
             Consolidated Statements of Income..............................................        3
             Consolidated Statements of Financial Condition.................................        4
             Consolidated Statements of Changes in Stockholders' Equity.....................        5
             Consolidated Statements of Cash Flows..........................................        6
             Notes to Consolidated Financial Statements.....................................        7
    Item 2.  Management's Discussion and Analysis of Financial
               Condition and Results of Operations..........................................       11
    Item 3.  Quantitative and Qualitative Disclosures about Market Risk.....................       23
Part II.  Other Information
    Item 1.  Legal Proceedings..............................................................       24
    Item 6.  Exhibits and reports on Form 8-K...............................................       24
    Signatures..............................................................................       24
</TABLE>

                                       2
<PAGE>

Item 1. Financial Statements

                    ALLFIRST FINANCIAL INC. AND SUBSIDIARIES

                       CONSOLIDATED STATEMENTS OF INCOME
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                        Three Months Ended              Six Months Ended
                                                                             June 30,                       June 30,
                                                                        -------------------             -----------------

                                                                        2000           1999             2000         1999
                                                                        ----           ----             -----        ----
                                                                                          (in thousands)
<S>                                                                  <C>             <C>             <C>            <C>
Interest Income
Interest and fees on loans and leases.........................       $213,788       $194,722          $419,751     $388,873
Interest and dividends on investment securities:
  Taxable.....................................................         55,369         58,028           111,327      120,035
  Tax-exempt..................................................          5,461          5,122            10,887       10,301
  Dividends...................................................          3,578          2,379             5,302        4,110
Interest on loans held-for-sale...............................            409            435               730          997
Other interest income.........................................            904            796             1,799        1,382
                                                                      -------        -------           -------      -------
      Total interest and dividend income......................        279,509        261,482           549,796      525,698
Interest Expense
Interest on deposits..........................................         97,357         88,632           192,028      180,541
Interest on Federal funds purchased and other short-
  term borrowings.............................................         35,603         24,837            66,160       51,854
Interest on long-term debt....................................         21,254         13,651            41,986       27,313
                                                                      -------        -------           -------      -------
      Total interest expense..................................        154,214        127,120           300,174      259,708
                                                                      -------        -------           -------      -------
Net Interest Income...........................................        125,295        134,362           249,622      265,990
Provision for loan and lease losses...........................          9,843          9,349            16,875       20,979
                                                                      -------        -------           -------      -------
Net Interest Income After Provision for Loan and
  Lease Losses................................................        115,452        125,013           232,747      245,011
                                                                      -------        -------           -------      -------
Noninterest Income
Service charges on deposit accounts...........................         24,591         23,037            48,588       47,858
Trust and investment advisory income..........................         21,995         19,931            43,827       39,894
Electronic banking income.....................................          7,356          6,335            13,341       11,467
Other income..................................................         31,345         29,523            56,756       54,586
Securities gains, net.........................................            143           (292)              175        4,991
                                                                      -------        -------           -------      -------
  Total noninterest income....................................         85,430         78,534           162,687      158,796
                                                                      -------        -------           -------      -------
Noninterest Expense
Salaries and other personnel costs............................         69,086         68,311           135,681      137,244
Equipment costs...............................................         11,076         13,229            22,932       24,534
Occupancy costs...............................................          9,038          8,741            18,550       18,253
Postage and communications....................................          4,945          4,864            10,059       10,590
Advertising and public relations..............................          3,972          8,560             6,958       10,551
Lending and collection........................................          1,427          5,176             3,361       10,086
Other operating expenses......................................         17,878         22,554            33,366       40,411
Intangible assets amortization expense........................         11,974         12,750            23,836       25,514
                                                                      -------        -------           -------      -------
  Total noninterest expenses..................................        129,396        144,185           254,743      277,183
                                                                      -------        -------           -------      -------
Income before income taxes....................................         71,486         59,362           140,691      126,624
Income tax expense............................................         24,678         21,811            48,530       46,655
                                                                      -------        -------           -------      -------
Net Income....................................................         46,808         37,551            92,161       79,969
Dividends on preferred stock..................................            102          3,056               203        5,558
                                                                      -------        -------           -------      -------
Net Income to Common Shareholders.............................        $46,706        $34,495           $91,958      $74,411
                                                                      =======        =======           =======      =======
</TABLE>

          See accompanying notes to consolidated financial statements


                                       3
<PAGE>

                   ALLFIRST FINANCIAL INC. AND SUBSIDIAIRIES

                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                                  (Unaudited)
<TABLE>
<CAPTION>
                                                                                               June 30,    December 31,
                                                                                                 2000         1999
                                                                                             -----------    -----------
                                                                                                   (in thousands,
                                                                                             except per share amounts)
<S>                                                                                          <C>           <C>
Assets
Cash and due from banks..................................................................    $  871,982     $  798,389
Interest bearing deposits in other banks.................................................         1,274          1,339
Trading account securities...............................................................         2,918          1,716
Federal funds sold and securities purchased under resale agreements......................       184,810        147,225
Investment securities available-for-sale.................................................     4,200,337      4,287,343
Loans held-for-sale......................................................................        47,841          4,808
Loans, net of unearned income of $223,566 and $217,146:
  Commercial.............................................................................     3,790,831      3,542,014
  Commercial real estate.................................................................     2,352,725      2,329,886
  Residential mortgage...................................................................       675,330        686,780
  Retail.................................................................................     2,896,219      2,945,593
  Commercial leases receivable...........................................................       632,675        615,670
  Retail leases receivable...............................................................       385,188        383,880
  Foreign................................................................................       246,307        276,807
                                                                                             -----------    -----------
     Total loans, net of unearned income.................................................    10,979,275     10,780,630
Allowance for loan and lease losses......................................................      (157,351)      (157,351)
                                                                                             -----------    -----------
     Loans, net..........................................................................    10,821,924     10,623,279
                                                                                             -----------    -----------
Premises and equipment...................................................................       199,688        203,425
Due from customers on acceptances........................................................        10,635          4,601
Intangible assets........................................................................       816,730        841,161
Other assets.............................................................................       883,639        593,964
                                                                                             -----------    -----------
        Total assets.....................................................................    $18,041,778    $17,507,250
                                                                                             ===========    ===========
Liabilities and Stockholders' Equity
Domestic deposits:
  Noninterest bearing deposits...........................................................    $ 2,826,114    $ 2,735,959
  Interest bearing deposits..............................................................      8,792,682      9,074,884
Interest bearing deposits in foreign banking office......................................        242,637        331,744
                                                                                             -----------    -----------
     Total deposits......................................................................     11,861,433     12,142,587
Federal funds purchased and securities sold under repurchase agreements..................      1,956,059        921,274
Other borrowed funds, short-term.........................................................        551,437        709,762
Bank acceptances outstanding.............................................................         10,635          4,602
Accrued taxes and other liabilities......................................................        639,317        702,150
Long-term debt...........................................................................      1,195,702      1,195,394
                                                                                             -----------    -----------
        Total liabilities................................................................     16,214,583     15,675,769
                                                                                             -----------    -----------
4.50% Cumulative, Redeemable Preferred Stock, $5 par value per share, $100 liquidation
preference per share: authorized and issued 90,000 shares................................          8,463          8,341
Minority interest........................................................................            114            120
Stockholders' equity:
Common Stock, no par value per share; authorized 1,200,000 shares,
   issued 597,763 shares.................................................................         85,395         85,395
Capital surplus..........................................................................        582,780        582,780
Retained earnings........................................................................      1,252,482      1,252,646
Accumulated other comprehensive loss.....................................................       (102,039)       (97,801)
                                                                                             -----------    -----------
        Total stockholders' equity.......................................................      1,818,618      1,823,020
                                                                                             -----------    -----------
          Total liabilities, redeemable preferred stock, minority interest and
            stockholders' equity.........................................................    $18,041,778    $17,507,250
                                                                                             ===========    ===========
</TABLE>

          See accompanying notes to consolidated financial statements

                                       4
<PAGE>

                   ALLFIRST FINANCIAL INC. AND SUBSIDIARIES

           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

                                  (Unaudited)




<TABLE>
<CAPTION>
                                                                                              Accumulated
                                                                                                Other
                                                                                                Compre-
                                                            Preferred     Common   Capital      hensive       Retained
                                                              Stock        Stock   Surplus      Income        Earnings       Total
                                                              -----        -----   --------     ------        --------       -----
                                                                                      (in thousands)
Six Months Ended June 30, 1999
------------------------------
<S>                                                         <C>          <C>      <C>       <C>           <C>          <C>
Balance, December 31, 1998..............................    $30,000      $85,395  $701,988      $23,379     $1,170,565   $2,011,327
Net income..............................................         -            -         -            -          79,969       79,969
Other comprehensive income, net of tax:
  Minimum pension liability adjustment..................         -            -         -         (603)             -          (603)
  Change in unrealized gains/losses on investment
   securities,  net of reclassification adjustment (1)..         -            -         -      (75,135)             -       (75,135)
                                                                                                                           --------
    Other comprehensive income..........................                                                                    (75,738)
                                                                                                                           --------
      Comprehensive income..............................         -            -         -           -               -         4,231
                                                                                                                           --------
Accretion of redeemable preferred stock.................         -            -         -           -             (113)        (113)
Dividends declared on common stock......................         -            -         -           -          (90,000)     (90,000)
Dividends declared on  preferred stock..................         -            -         -           -           (5,355)      (5,355)
Dividends declared on redeemable preferred stock........         -            -         -           -             (203)        (203)
                                                            --------     --------  ---------  ---------    ------------   ----------
Balance, June 30, 1999..................................    $30,000      $85,395  $701,988    $ (52,359)    $1,154,863   $1,919,887
                                                            ========     ========  =========  =========    ============   ==========

Six Months Ended June 30, 2000
------------------------------
<S>                                                         <C>          <C>      <C>       <C>           <C>          <C>
Balance, December 31, 1999..............................    $    -      $85,395  $582,780    $  (97,801)    $1,252,646   $1,823,020
Net income..............................................         -            -         -            -          92,161       92,161
Other comprehensive income, net of tax:
  Minimum pension liability adjustment..................         -            -         -           963             -           963
  Change in unrealized gains/losses on investment
   securities,  net of reclassification adjustment (1)..         -            -         -        (5,201)            -        (5,201)
                                                                                                                           --------
    Other comprehensive income..........................                                                                     (4,238)
                                                                                                                           --------
      Comprehensive income..............................         -            -         -           -               -       (87,923)
                                                                                                                           --------
Accretion of redeemable preferred stock.................         -            -         -           -             (122)        (122)
Dividends declared on common stock......................         -            -         -           -          (92,000)     (92,000)
Dividends declared on redeemable preferred stock........         -            -         -           -             (203)        (203)
                                                            --------     --------  ---------  ---------    ------------   ----------
Balance, June 30, 2000..................................    $    -       $85,395  $582,780   $(102,039)     $1,252,482   $1,818,618
                                                            ========     ========  =========  =========    ============   ==========
</TABLE>



<TABLE>
<CAPTION>
(1)  Disclosure of reclassification amount:                                                               Six Months Ended
                                                                                                              June 30,
                                                                                                         -------------------
<S>                                                                                                      <C>       <C>
                                                                                                         2000           1999
                                                                                                         ----           ----

     Net unrealized holding gains (losses) on investment securities arising during period..........    $(5,095)      $(72,118)
     Less: reclassification adjustment for realized gains included in net income...................        106          3,017
                                                                                                       -------       --------
     Change in unrealized gains/losses on investment securities, net of tax........................    $(5,201)      $(75,135)
                                                                                                       =======       ========
</TABLE>




          See accompanying notes to consolidated financial statements

                                       5
<PAGE>

                   ALLFIRST FINANCIAL INC. AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF CASH FLOWS

                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                                                             Six Months Ended
                                                                                                                 June 30,
                                                                                                       -------------------------
<S>                                                                                                      <C>         <C>
                                                                                                              2000          1999
                                                                                                         ---------   -----------
                                                                                                             (in thousands)
Operating Activities
Net income..................................................................................            $  92,161   $    79,969
Adjustments to reconcile net income to net cash (used for) provided by operating
  activities:
  Provision for loan and lease losses.......................................................               16,875        20,979
  Provision for other real estate losses....................................................                  125         1,890
  Depreciation and amortization.............................................................               40,200        42,932
  Deferred income tax expense...............................................................                3,414        25,603
  Net gain on the sale of assets............................................................                 (460)       (6,357)
  Net (increase) decrease in loans held for sale............................................              (43,033)       74,436
  Net (increase) decrease in trading account securities.....................................               (1,202)        4,789
  Net decrease (increase) in accrued interest receivable....................................                1,242           (63)
  Net (decrease) increase in accrued interest payable.......................................              (31,535)        6,317
  Other, net................................................................................             (196,559)      (49,841)
                                                                                                        ---------      ---------
     Net cash (used for) provided by operating activities...................................             (118,772)      200,654
                                                                                                        ---------      ---------
Investing Activities
  Proceeds from sales of investment securities available-for-sale...........................              143,393     1,334,194
  Proceeds from paydowns and maturities of investment securities available-for-sale.........              254,843       492,690
  Purchases of investment securities available-for-sale.....................................             (260,111)   (1,434,847)
  Net (increase) decrease in fed funds sold and repos.......................................              (37,585)      113,088
  Net disbursements from lending activities of banking subsidiaries.........................             (223,588)     (208,491)
  Principal collected on loans of nonbank subsidiaries......................................                4,951         6,789
  Loans originated by nonbank subsidiaries..................................................               (7,576)       (5,097)
  Proceeds from the sale of other real estate...............................................                5,362        22,137
  Net purchases of premises and equipment...................................................              (11,746)      (18,043)
  Purchase of bank owned life insurance.....................................................             (179,000)            -
  Other, net................................................................................                  254        10,646
                                                                                                        ---------      ---------
     Net cash (used for) provided by investing activities...................................             (310,803)      313,066
                                                                                                        ---------      ---------
Financing Activities
  Net decrease in deposits..................................................................             (281,154)     (300,190)
  Net increase (decrease) in short-term borrowings..........................................              876,460      (381,705)
  Proceeds from the issuance of long-term debt..............................................                    -        99,615
  Principal payments on long-term debt......................................................                    -       (60,000)
  Cash dividends paid.......................................................................              (92,203)      (95,557)
                                                                                                        ---------      --------
     Net cash provided by (used for) financing activities...................................              503,103      (737,837)
                                                                                                        ---------      --------
Increase (Decrease) in cash and cash equivalents............................................               73,528      (224,117)
Cash and cash equivalents at January 1,.....................................................              799,728     1,207,656
                                                                                                        ---------     ---------
Cash and cash equivalents at June 30,.......................................................            $ 873,256     $ 983,539
                                                                                                        =========     =========
Supplemental Disclosures
   Interest payments........................................................................            $ 331,709     $ 253,391
   Income tax payments, net of tax refunds..................................................               31,944        19,623
Noncash Investing And Financing Activities
   Loan charge-offs.........................................................................               22,405        25,102
   Transfers to other real estate and other assets owned....................................                9,145        24,387

</TABLE>



          See accompanying notes to consolidated financial statements

                                       6
<PAGE>

                    ALLFIRST FINANCIAL INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                  (Unaudited)

1.  Basis of Presentation

       The accompanying unaudited consolidated financial statements of Allfirst
Financial Inc. and Subsidiaries ("Allfirst"), have been prepared in accordance
with generally accepted accounting principles for interim financial reporting.
Accordingly, they do not include all information and footnotes required by
generally accepted accounting principles for complete financial statements.  In
the opinion of management, all adjustments (which consist of only normal,
recurring accruals) necessary for a fair presentation have been included.
Certain amounts in prior periods have been reclassified for comparative
purposes.  Operating results for the six month period ended June 30, 2000 are
not necessarily indicative of the results that may be expected for the year
ended December 31, 2000. These unaudited financial statements should be read in
conjunction with the audited financial statements and related notes included in
Allfirst's 1999 Annual Report on Form 10-K.


2.  Investment Securities

       The amortized cost and fair value of available-for-sale securities at
June 30, 2000 are as follows:

<TABLE>
<CAPTION>
                                                                           Gross            Gross
                                                        Amortized       Unrealized        Unrealized          Fair
                                                          Cost             Gains            Losses            Value
                                                     ---------------  ---------------  ----------------  ---------------
                                                                               (in thousands)
<S>                                                  <C>              <C>              <C>               <C>
U.S. Treasury and U.S. Government agencies.........       $  214,686           $   37        $  (2,439)       $  212,284
Mortgage-backed obligations........................        2,004,874            1,201         (102,951)        1,903,124
Collateralized mortgage obligations................        1,001,322            1,056          (15,549)          986,829
Asset-backed securities............................          377,343               96           (5,999)          371,440
Obligations of states and political subdivisions...          465,511            3,227           (9,422)          459,316
Other debt securities..............................           58,181               58                -            58,239
Equity securities..................................          239,742            1,261          (31,898)          209,105
                                                          ----------           ------        ---------        ----------
       Total.......................................       $4,361,659           $6,936        $(168,258)       $4,200,337
                                                          ==========           ======        =========        ==========
</TABLE>


                                       7
<PAGE>

                    ALLFIRST FINANCIAL INC. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)


3.  Line of Business Reporting

        Allfirst has determined that its major lines of business are those that
are based on Allfirst's method of internal reporting, which separates its
business on the basis of products and services. Allfirst's reportable business
lines are Community Banking, Capital Markets, Asset Management, and Treasury.
Community Banking provides loans, deposits, and credit life insurance to
consumers and commercial small business customers. Capital Markets provides
commercial loans, construction and property loans, letters of credit, derivative
financial instruments, foreign exchange and cash management products and
services to domestic and international corporate customers. It is also involved
in mortgage banking activities related to multi-family housing loan programs and
residential mortgage lending. Asset Management provides investment advisory,
investment, and fiduciary services to individual, institutional and corporate
clients, including mutual fund and annuity products sold through retail
branches. Treasury is responsible for managing and controlling the liquidity,
funding and market risk needs of Allfirst. Other includes merchant services and
other smaller business units, inter-segment income elimination and unallocated
income and expenses, including goodwill and other intangible asset amortization.
Other also receives a credit for funds provided and charges for funds used.


        Allfirst's internal accounting process is based on practices which
support the management structure of Allfirst, and the resulting data is not
necessarily comparable with similar information from other financial
institutions. Net income reflects costs directly associated with each business
line plus an appropriate share of corporate overhead expenses. A match funded
transfer pricing system is used to allocate interest income and expense, with a
business line receiving credit for funds provided and charges for funds used.
Loan loss provisions and the allowance for loan and lease losses are allocated
based on the credit risk of each business line's loan portfolio and the changes
therein. Interest rate risk is aggregated from all lines and classified under
"Treasury". In addition, Treasury includes investment portfolio revenue,
wholesale funding expenses and other revenue and expenses associated with the
Treasury unit.

                                       8
<PAGE>

                    ALLFIRST FINANCIAL INC. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)


3.  Line of Business Reporting (continued)

        The following tables present operating information about each of
Allfirst's business lines for the three months and six months ended June 30,
2000 and 1999. Net interest income is presented on a fully tax equivalent
("FTE") basis, therefore, interest income from tax exempt earning assets is
increased by an amount equivalent to the federal income taxes that would have
been paid if this income was taxable at the statutory Federal income tax rate of
35%. The offset to this adjustment is made to income tax expense.


                             Business Line Results
                        Three Months Ended June 30, 2000
<TABLE>
<CAPTION>

                                              Community          Capital      Asset                             Consolidated
(in thousands)                                Banking           Markets    Management     Treasury    Other       Total
                                              -------           -------    ----------     --------    -----       -----
<S>                                          <C>            <C>             <C>          <C>       <C>        <C>
Net interest income (FTE)...............      $ 84,272           $52,816    $   630        $2,203    $(10,617)   $129,304
Noninterest income......................        25,366            27,882     22,529         2,336       7,174      85,287
Securities gains, net...................             -               126          -            17           -         143
                                              --------           -------    --------     --------     --------    -------
  Total revenues........................       109,638            80,824     23,159         4,556      (3,443)    214,734
Total noninterest expenses, excluding
    intangible asset amortization.......        66,328            33,396     13,114         2,080       2,504     117,422
Goodwill and other intangible asset
    amortization........................           226                          274                    11,474      11,974
Provision for loan and lease losses.....         3,632             5,853         16             -         342       9,843
                                              --------           -------    --------     --------     --------    -------
  Income before income taxes............        39,452            41,575      9,755         2,476     (17,763)     75,495
Income tax expense (FTE)................        15,528            15,204      3,905           247      (6,197)     28,687
                                              --------           -------    --------     --------     --------    -------
  Net income............................      $ 23,924           $26,371    $ 5,850        $2,229    $(11,566)   $ 46,808
                                              ========           =======    ========     ========     ========    =======

(in millions)
Average assets..........................      $  8,276           $ 7,363    $    69        $5,321    $ (3,426)   $ 17,603
Average loans...........................         4,148             6,669         13             -          76      10,906
Average deposits........................         7,854             1,364         56         2,279          74      11,627

</TABLE>

                             Business Line Results
                         Six Months Ended June 30, 2000
<TABLE>
<CAPTION>
                                              Community          Capital      Asset                             Consolidated
(in thousands)                                Banking           Markets    Management     Treasury    Other       Total
                                              -------           -------    ----------     --------    -----       -----
<S>                                          <C>            <C>             <C>          <C>       <C>        <C>
Net interest income (FTE)..............       $167,351          $104,824    $ 1,235        $6,119    $(21,952)   $257,577
Noninterest income.....................         48,557            54,520     45,281         3,357      10,797     162,512
Securities gains, net..................              -               126          -            49           -         175
                                              --------           -------    --------     --------     --------    -------
  Total revenues.......................        215,908           159,470     46,516         9,525     (11,155)    420,264
Total noninterest expenses, excluding
    intangible asset amortization......        128,909            65,514     25,191         3,973       7,320     230,907
Goodwill and other intangible asset
    amortization.......................            452                 -        547             -      22,837      23,836
Provision for loan and lease losses....          7,240            11,342         32             -      (1,739)     16,875
                                              --------           -------    --------     --------     --------    -------
  Income before income taxes...........         79,307            82,614     20,746         5,552     (39,573)    148,646
Income tax expense (FTE)...............         31,213            30,581      8,300           671     (14,280)     56,485
                                              --------           -------    --------     --------     --------    -------
  Net income...........................       $ 48,094           $52,033    $12,446        $4,881    $(25,293)   $ 92,161
                                              ========           =======    ========     ========     ========    =======

(in millions)
Average assets.........................       $  8,214           $ 7,277    $    68        $5,321    $ (3,303)   $ 17,577
Average loans..........................          4,190             6,579         13             -          71      10,853
Average deposits.......................          7,788             1,388         55         2,336          79      11,646


</TABLE>

                                       9
<PAGE>

                    ALLFIRST FINANCIAL INC. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

3.  Line of Business Reporting (continued)


                             Business Line Results
                        Three Months Ended June 30, 1999
<TABLE>
<CAPTION>
                                              Community          Capital      Asset                             Consolidated
(in thousands)                                Banking           Markets    Management     Treasury    Other       Total
                                              -------           -------    ----------     --------    -----       -----
<S>                                          <C>            <C>             <C>          <C>       <C>        <C>
Net interest income (FTE)...............      $ 87,411          $ 48,756    $   816        $7,894    $( 6,359)   $138,518
Noninterest income......................        18,752            28,034     22,779           922       8,339      78,826
Securities gains, net...................             -                 -          -          (292)          -        (292)
                                              --------           -------    --------     --------     --------    -------
  Total revenues........................       106,163            76,790     23,595         8,524       1,980     217,052
Total noninterest expenses, excluding
    intangible asset amortization.......        59,708            39,912     12,884         2,191      16,740     131,435
Goodwill and other intangible asset
    amortization........................           226                 -        273             -      12,251      12,750
Provision for loan and lease losses.....         3,420             3,071         16             -       2,842       9,349
                                              --------           -------    --------     --------     --------    -------
  Income before income taxes............        42,809            33,807     10,422         6,333     (29,853)     63,518
Income tax expense (FTE)................        17,237            11,629      4,328          (340)     (6,887)     25,967
                                              --------           -------    --------     --------     --------    -------
  Net income............................      $ 25,572           $22,178    $ 6,094        $6,673    $(22,966)   $ 37,551
                                              ========           =======    ========     ========     ========    =======

(in millions)
Average assets..........................      $  8,618           $ 7,170    $    84        $4,912    $ (3,141)   $ 17,643
Average loans...........................         4,098             6,365         13             -         160      10,636
Average deposits........................         8,087             1,518         71         2,274          86      12,036



</TABLE>
                             Business Line Results
                         Six Months Ended June 30, 1999
<TABLE>
<CAPTION>
                                              Community          Capital      Asset                             Consolidated
(in thousands)                                Banking           Markets    Management     Treasury    Other       Total
                                              -------           -------    ----------     --------    -----       -----
<S>                                          <C>            <C>             <C>          <C>       <C>        <C>
Net interest income (FTE)...............      $163,633          $105,784    $ 1,274       $14,897    $(12,085)   $273,503
Noninterest income......................        37,801            50,724     44,759         2,775      17,746     153,805
Securities gains, net...................             -                 -          -         4,991           -       4,991
                                              --------           -------    --------     --------     --------    -------
  Total revenues........................       201,434           156,508     46,033        22,663       5,661     432,299
Total noninterest expenses, excluding
    intangible asset amortization.......       121,286            76,864     26,078         4,766      22,675     251,669
Goodwill and other intangible asset
    amortization........................           452                 -        547             -      24,515      25,514
Provision for loan and lease losses.....         6,701             8,154         33             -       6,091      20,979
                                              --------           -------    --------     --------     --------    -------
  Income before income taxes............        72,995            71,490     19,375        17,897     (47,620)    134,137
Income tax expense (FTE)................        28,693            24,296      7,756         3,845     (10,422)     54,168
                                              --------           -------    --------     --------     --------    -------
  Net income............................      $ 44,302           $47,194    $11,619       $14,052    $(37,198)   $ 79,969
                                              ========           =======    ========     ========     ========    =======

(in millions)
Average assets..........................      $  8,632           $ 7,064    $    72        $4,904    $ (2,940)   $ 17,732
Average loans...........................         4,036             6,367         13             -         170      10,586
Average deposits........................         8,105             1,580         59         2,187          85      12,016


</TABLE>





                                       10
<PAGE>

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

FORWARD-LOOKING STATEMENTS

   Certain information included in the following section of this report, other
than historical information, may contain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.  The forward-
looking statements are identified by terminology such as "may", "will",
"believe", "expect", "estimate", "anticipate", "continue", or similar terms.
Actual results may differ materially from those projected in the forward-looking
statements.  Factors that could cause actual results to differ materially from
those in the forward-looking statements include, but are not limited to: global,
national and regional economic conditions; levels of market interest rates;
credit or other risks of lending and investment activities; competitive and
regulatory factors; and technological change.


ANALYSIS OF RESULTS OF OPERATIONS

Performance Overview

     Net income to common shareholders for the three months ended June 30, 2000
of $46.7 million, increased $12.2 million (35.4%) when compared to net income to
common shareholders of $34.5 million for the three months ended June 30, 1999.
Net income to common shareholders represents net income after deducting
preferred stock dividends.   Net income for the second quarter of 1999 included
$6.1 million in after tax costs ($10.0 million pre-tax) associated with the
Allfirst brand introduction.  Return on average assets and return on average
stockholder's equity were 1.07% and 10.51%, respectively, for the three months
ended June 30, 2000 compared to 0.85% and 7.82% for the three months ended June
30, 1999.

     Net income to common shareholders for the six months ended June 30, 2000 of
$92.0 million, increased $17.6 million (23.7%) when compared to net income to
common shareholders of $74.4 million for the six months ended June 30, 1999.
There were no material nonrecurring revenues or expenses in the first half of
2000. Net income for the first six months of 1999 included after tax investment
securities gains of $3.0 million ($5.0 million pretax) as well as after tax
expenses of $6.1 million related to the Allfirst brand introduction.  Excluding
these items, net income to common shareholders for the first half of 2000
increased $14.6 million (18.9%) over the first half of 1999.  Return on average
assets and return on average common stockholder's equity were 1.05% and 10.44%,
respectively, for the six months ended June 30, 2000 compared to 0.91% and 8.19%
for the six months ended June 30, 1999.

   The increase in net income to common shareholders relative to the first half
of 1999 was the result of lower operating expenses in the current year coupled
with a decrease in the provision for loan and lease losses.  These expense
improvements more than offset a small decrease in operating revenues. In
addition, the redemption of Allfirst's preferred stock in July 1999 resulted in
a $1.9 million after tax increase in net income to common shareholders in the
current year relative to the prior year.

     Tangible net income, which excludes amortization of goodwill and other
intangible assets related to purchase business combinations, was $57.7 million
for the three months ended June 30, 2000, representing a $8.7 million  (17.8%)
increase over tangible net income to common shareholders of  $49.0 million for
the three months ended June 30, 1999. Excluding the one-time costs associated
with the Allfirst brand introduction in 1999, tangible net income for the three
months ended June 30, 2000 increased $2.6 million (4.7%) over the prior year
period.  Return on average tangible assets and return on average tangible common
equity were 1.38% and 23.75%, respectively, for the second quarter of 2000
compared to 1.17% and 18.05% for the quarter ended June 30, 1999.

                                       11
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)

     Tangible net income for the six months ended June 30, 2000 was $114.0
million compared to $102.8 million for the six months ended June 30, 1999.
Excluding the one-time costs associated with the Allfirst brand introduction and
net after tax securities gains, tangible net income for the six months ended
June 30, 2000 increased $8.2 million (7.8%) over the prior year period.  Return
on average tangible assets and return on average tangible common equity were
1.37% and 23.91%, respectively for the six months ended June 30, 2000 compared
to 1.23% and 18.6% for the prior year period.

     Nonperforming assets at June 30, 2000 were $95.5 million, or 0.87% of
loans, other real estate and other assets owned, a $15.0 million increase over
the December 31, 1999 level of $80.5 million, or 0.74% of loans, other real
estate and other assets owned. The growth was primarily attributable to a $22.5
million credit relationship with a large healthcare provider that was added to
nonperforming assets during the first quarter. The exposure to this credit was
reduced to $10.5 million during the second quarter of 2000. Aside from this
relationship, there has been no appreciable change in the risk profile of this
portfolio over the last four quarters.  Asset quality is discussed in more
detail on page 23.


Net Interest Income

     The largest source of Allfirst's net income is net interest income.  For
analytical purposes, net interest income is adjusted to a "taxable equivalent"
basis to recognize the income tax savings on tax exempt assets. Net interest
income on a taxable equivalent basis for the second quarter of 2000 was $129.3
million, a decrease of $9.2 million when compared to net interest income of
$138.5 million for the second quarter of 1999. The decrease in net interest
income relative to the second quarter of 1999 is primarily due to a thirty four
basis point decline in the spread between the yield on earning assets and the
rate paid on interest bearing liabilities as well as the redemption of
Allfirst's preferred stock during the third quarter of 1999 and the investment
in bank owned life insurance during the fourth quarter of 1999 and the first
quarter of 2000.

     Allfirst's net interest margin was 3.40% for the second quarter of 2000
compared to 3.64% for the second quarter of 1999.  The yield on total earning
assets increased from 6.99% in 1999 to 7.45% for 2000, which reflects
the effects of a higher market interest rate environment.  However, this
increase was not enough to offset the increase on the rate paid on interest
bearing liabilities.  With the combination of lower deposits due to competitive
pressures and reliance on purchased funds and borrowings to meet short-term
funding requirements, the interest rate paid on total interest bearing
liabilities increased from 4.15% in 1999 to 4.95% for 2000.

     The following tables provide additional information on Allfirst's average
balances, interest yields and rates, and net interest margin for the three
months and six months ended June 30, 2000 and 1999.

                                       12
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)

      Average Balances, Interest Yields and Rates and Net Interest Margin
                             (Tax Equivalent Basis)
<TABLE>
<CAPTION>
                                                                        Three Months Ended
                                                    ------------------------------------------------------------------------
                                                         June 30, 2000                       June 30, 1999
                                                      -------------------------------        -------------
                                                     Average                   Yield/    Average                   Yield/
                                                     Balance    Interest (1)  Rate (1)   Balance    Interest (1)  Rate (1)
                                                     -------    ------------  --------   -------    ------------  ----------
                                                                              (dollars in millions)
<S>                                                <C>         <C>           <C>       <C>         <C>           <C>

ASSETS
Earning assets:
  Trading account securities...................       $  3.4        $  0.1      6.57%    $  34.4        $  0.4      4.94%
  Money market investments.....................         52.5           0.8      6.51        29.9           0.4      5.01
Investment securities (2):
  Taxable......................................      3,731.7          55.4      5.97     3,923.1          58.0      5.93
  Tax exempt...................................        423.2           8.4      7.98       397.0           8.2      8.27
  Equity investments...........................        167.1           3.7      8.94       196.2           2.5      5.19
                                                     -------        ------     -----     -------        ------     -----
    Total investment securities................      4,321.9          67.5      6.28     4,516.3          68.8      6.11
                                                     -------        ------     -----     -------        ------     -----
Loans held for sale............................         22.5           0.4      7.31        29.8           0.4      5.85
Loans (net of unearned income) (3):
  Commercial...................................      3,725.2          74.8      8.07     3,454.4          60.8      7.05
  Commercial real estate.......................      2,357.6          48.5      8.27     2,406.1          45.9      7.65
  Residential mortgage.........................        674.0          12.5      7.45       733.8          13.6      7.41
  Retail.......................................      2,906.9          59.9      8.28     2,865.1          57.7      8.07
  Commercial leases receivable.................        591.5           7.2      4.88       540.0           7.1      5.26
  Retail leases receivable.....................        388.3           7.0      7.24       325.3           6.1      7.56
  Foreign......................................        262.0           5.0      7.56       311.3           4.6      5.91
                                                     -------        ------     -----     -------        ------     -----
    Total loans................................     10,905.5         214.7      7.92    10,635.9         195.7      7.38
       Total earning assets....................     15,306.0         283.5      7.45    15,246.2         265.6      6.99
Allowance for loan and lease losses............       (157.4)                             (157.4)
Cash and due from banks........................        740.8                               833.3
Other assets...................................      1,713.5                             1,721.1
                                                    --------                            --------
  Total assets.................................    $17,602.9                           $17,643.3
                                                    ========                            ========

LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits in domestic offices:
  Interest bearing demand......................    $   126.4        $  0.6      1.84%  $   145.7        $  0.7      1.98%
  Money market accounts........................      2,527.3          18.1      2.88     2,669.1          17.2      2.58
  Savings......................................      1,282.2           5.4      1.69     1,419.9           6.2      1.76
  Other consumer time..........................      2,859.3          38.4      5.40     2,923.6          37.7      5.17
  Large denomination time......................      1,981.5          31.8      6.45     1,742.3          22.2      5.11
Deposits in foreign banking office.............        212.6           3.1      5.97       388.8           4.6      4.78
                                                     -------        ------     -----     -------        ------     -----
    Total interest bearing deposits............      8,989.3          97.4      4.36     9,289.4          88.6      3.83
                                                     -------        ------     -----     -------        ------     -----
Funds purchased................................      1,778.5          27.4      6.20     1,648.8          19.2      4.66
Other borrowed funds, short-term...............        573.0           8.2      5.76       490.4           5.7      4.65
Long-term debt.................................      1,195.6          21.3      7.15       869.6          13.7      6.30
                                                     -------        ------     -----     -------        ------     -----
    Total interest bearing liabilities.........     12,536.5         154.2      4.95    12,298.2         127.1      4.15
Noninterest bearing deposits...................      2,638.0                             2,746.3
Other liabilities..............................        633.1                               647.4
Redeemable preferred stock.....................          8.5                                 8.2
Stockholders' equity...........................      1,786.8                             1,943.1
                                                    --------                            --------
  Total liabilities and stockholders' equity...    $17,602.8                           $17,643.3
                                                    ========                            ========
 Net interest income, tax equivalent basis.....                     $129.3                              $138.5
                                                                    ======                              ======
Net interest spread (4)........................                                 2.50%                               2.84%
Contribution of interest free sources of funds.                                 0.90                                0.80
Net interest margin (5)........................                                 3.40%                               3.64%
</TABLE>
_____________________________
(1)  Interest on loans to and obligations of public entities is not subject to
     Federal income tax. In order to make pretax yields comparable to taxable
     loans and investments, a tax equivalent adjustment is used based on a 35%
     Federal tax rate.
(2)  Yields on investment securities available-for-sale are calculated based
     upon average amortized cost.
(3)  Nonaccrual loans are included under the appropriate loan categories as
     earning assets.
(4)  Net interest spread is the difference between the yield on average earning
     assets and the rate paid on average interest bearing liabilities.
(5)  Net interest margin is the ratio of net interest income on a fully tax-
     equivalent basis to average earning assets.

                                       13
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)

      Average Balances, Interest Yields and Rates and Net Interest Margin
                             (Tax Equivalent Basis)
<TABLE>
<CAPTION>
                                                                              Six Months Ended
                                                    ------------------------------------------------------------------------
                                                               June 30, 2000                       June 30, 1999
                                                      -------------------------------    ---------------------------------
                                                       Average                   Yield/    Average                   Yield/
                                                       Balance    Interest (1)  Rate (1)   Balance    Interest (1)  Rate (1)
                                                       -------    ------------  --------   -------    ------------  ----------
                                                                              (dollars in millions)
<S>                                                <C>         <C>           <C>       <C>         <C>           <C>

ASSETS
Earning assets:
  Trading account securities.....................    $    2.8        $  0.1      6.32%     $  31.4        $  0.8      4.86%
  Money market investments.......................        55.9           1.7      6.16         26.1           0.6      4.84
Investment securities:
  Taxable........................................     3,722.9         111.3      6.01     4,026.4         120.0       6.01
  Tax exempt.....................................       423.8          16.7      7.95       403.8          15.8       7.90
  Equity investments.............................       206.2           5.6      5.43       178.1           4.4       4.99
                                                     --------        ------      ----     --------       ------     -------
     Total investment securities.................     4,352.9         133.6      6.17     4,608.2         140.2       6.14
                                                     --------        ------      ----     --------       ------     -------
Loans held for sale..............................        20.0            .7      7.35        32.6           1.0       6.16
Loans (net of unearned income):
  Commercial.....................................     3,642.4         143.7      7.94     3,428.7         120.3       7.08
  Commercial real estate.........................     2,351.2          95.6      8.18     2,373.3          91.7       7.79
  Residential....................................       677.7          25.2      7.47       764.7          28.5       7.51
  Retail.........................................     2,922.6         119.4      8.21     2,816.8         113.2       8.10
  Commercial leases receivable...................       599.4          14.7      4.92       540.2          14.5       5.41
  Retail leases receivable.......................       389.9          14.1      7.27       323.0          12.1       7.58
  Foreign........................................       269.1           8.9      6.63       339.6          10.3       6.10
                                                     --------        ------      ----     --------       ------     -------
     Total loans.................................    10,852.3         421.6      7.81    10,586.3         390.6       7.44
                                                     --------        ------      ----     --------       ------     -------
       Total earning assets......................    15,283.9         557.7      7.34    15,284.6         533.2       7.03
Allowance for credit losses......................      (157.4)                             (157.4)
Cash and due from banks..........................       762.2                               899.3
Other assets.....................................     1,688.0                             1,705.8
                                                     --------                            --------
     Total assets................................   $17,576.7                           $17,732.4
                                                     ========                            ========

LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits in domestic offices:
  Interest bearing demand........................   $   126.1        $  1.2      1.88%  $   142.5        $  1.4       2.10%
  Money market accounts..........................     2,511.4          35.2      2.82     2,697.6          36.6       2.73
  Savings........................................     1,286.0          10.8      1.69     1,404.2          14.1       2.02
  Other consumer time............................     2,838.3          74.7      5.30     2,984.3          77.2       5.21
  Large denomination time........................     1,994.5          62.9      6.34     1,632.6          41.8       5.17
Deposits in foreign banking office...............       250.4           7.2      5.76       393.8           9.4       4.83
                                                     --------        ------      ----     --------       ------     -------
       Total interest bearing deposits...........     9,006.7         192.0      4.29     9,255.1         180.5       3.93
                                                     --------        ------      ----     --------       ------     -------
Funds purchased..................................     1,680.1          49.6      5.95     1,769.6          41.0       4.68
Other borrowed funds, short-term.................       595.0          16.5      5.57       467.0          10.8       4.68
Long-term debt...................................     1,195.6          42.0      7.06       863.0          27.3       6.38
                                                     --------        ------      ----     --------       ------     -------
       Total interest bearing liabilities........    12,477.4         300.1      4.84    12,354.7         259.7       4.24
                                                     --------        ------      ----     --------       ------     -------
Noninterest bearing deposits.....................     2,639.0                             2,760.5
Other liabilities................................       680.7                               632.6
Redeemable preferred stock.......................         8.5                                 8.1
Stockholders' equity.............................     1,771.1                             1,976.4
                                                     --------                            --------
  Total liabilities and stockholders' equity.....   $17,576.7                           $17,732.4
                                                     ========                            ========
Net interest income, tax equivalent basis........                    $257.6                              $273.5
                                                                      =====                               =====
Net interest spread..............................                                2.50%                               2.80%
Contribution of interest free sources of funds...                                0.89                                0.81
Net interest margin..............................                                3.39%                               3.61%

</TABLE>
_____________________________
(1)  Interest on loans to and obligations of public entities is not subject to
     Federal income tax. In order to make pre-tax yields comparable to taxable
     loans and investments, a tax equivalent adjustment is used based on a 35%
     Federal tax rate.
(2)  Yields on investment securities available-for-sale are calculated based
     upon average amortized cost.
(3)  Nonaccrual loans are included under the appropriate loan categories as
     earning assets.
(4)  Net interest spread is the difference between the yield on average earning
     assets and the rate paid on average interest bearing liabilities.
(5)  Net interest margin is the ratio of net interest income on a fully tax-
     equivalent basis to average earning assets.

                                       14
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)

Noninterest Income

  The following table presents the components of noninterest income for the
three months ended June 30, 2000 and 1999.


                               Noninterest Income

<TABLE>
<CAPTION>
                                                                      Three Months Ended
                                                                           June  30,                   Net Change
                                                                  ---------------------------          ----------
<S>                                                               <C>           <C>            <C>           <C>
                                                                      2000            1999        Dollar       Percent
                                                                      ----            ----        ------       -------
                                                                                  (dollars in thousands)
Service charges on deposit accounts...................              $24,591         $23,037      $ 1,554           6.8%
Trust and investment advisory fees....................               21,995          19,931        2,064          10.4
Electronic banking income.............................                7,356           6,335        1,021          16.1
Other income..........................................               31,345          29,523        1,822           6.2
                                                                    -------          ------       ------        ------
     Total fees and other income......................               85,287          78,826        6,461           8.2
Securities gains, net.................................                  143            (292)         435        (149.0)
                                                                    -------          ------       ------        ------
   Total noninterest income...........................              $85,430         $78,534       $6,896           8.8%
                                                                    =======          =======      ======        ======
</TABLE>

  Allfirst's noninterest income for the second quarter of 2000 was $85.4
million, a $6.9 million (8.8%) increase from noninterest income for the second
quarter of 1999.  Service charges on deposit accounts increased with growth
in corporate deposit service charges offsetting a decrease in retail deposit
service charges.  Trust and investment advisory fees increased primarily due to
growth in custody fees, investment advisory fees, and proprietary funds
management fees. Electronic banking income increased primarily due to debit card
interchange income.  Other income increased when compared to the same period in
1999, reflecting increases in mortgage banking income, merchant and credit card
income as well as trading income.  Additionally, increases in line of credit
fees, cash surrender value of bank owned life insurance, and income on equity
investments more than offset a decline in lease residual gains.

                                       15
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)

  The following table presents the components of noninterest income for the six
months ended June 30, 2000 and 1999.

                               Noninterest Income

<TABLE>
<CAPTION>
                                                                        Six Months Ended
                                                                           June  30,                   Net Change
                                                                  ---------------------------          ----------
<S>                                                               <C>           <C>            <C>           <C>
                                                                      2000            1999        Dollar       Percent
                                                                      ----            ----        ------       -------
                                                                                  (dollars in thousands)
Service charges on deposit accounts...................             $ 48,588        $ 47,858      $   730           1.5%
Trust and investment advisory fees....................               43,827          39,894        3,933           9.9
Electronic banking income.............................               13,341          11,467        1,874          16.3
Other income..........................................               56,756          54,586        2,170           3.9
                                                                    -------         -------       ------        ------
     Total fees and other income......................              162,512         153,805        8,707           5.7
Securities gains, net.................................                  175           4,991       (4,816)        (96.5)
                                                                    -------         -------       ------        ------
   Total noninterest income...........................             $162,687        $158,796      $ 3,891           2.5%
                                                                    =======         =======       ======        ======
</TABLE>


  Allfirst's noninterest income for the six months ended June 30, 2000 was
$162.7 million, a $3.9 million (2.5%) increase from noninterest income for the
six months ended June 30, 1999.  Service charges on deposit accounts increased
with growth in corporate deposit service charges offsetting a decrease in retail
deposit service charges.  Trust and investment advisory fees increased due to a
higher level of custodial fees, personal trust fees and investment advisory
fees.  Electronic banking income increased primarily due to an increase in debit
card interchange income.  Other income increased with growth from securities
sales and fees, trading income, letter of credit fees, cash surrender value of
bank owned life insurance, income on equity investments and late charges more
than offsetting decreases in mortgage banking income, retail and corporate
customer service fees, and lease residual gains. Securities gains, for the first
half of 1999 included investment securities gains of $5.0 million.

                                       16
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)

Noninterest Expenses

The following table presents the components of noninterest expenses for the
three months ended June 30, 2000 and 1999.


                              Noninterest Expenses


<TABLE>
<CAPTION>
                                                                      Three Months Ended
                                                                           June 30,                     Net Change
                                                                  --------------------------            ----------
<S>                                                               <C>           <C>           <C>             <C>
                                                                  2000                 1999         Dollar          Percent
                                                                  ----                 ----         ------          -------
                                                                                   (dollars in thousands)
Salaries and other personnel costs.........................      $ 69,086           $ 68,311       $    775             1.1%
Equipment costs............................................        11,076             13,229         (2,153)          (16.3)
Occupancy costs............................................         9,038              8,741            297             3.4
Other operating expenses:
   Postage and communications..............................         4,945              4,864             81             1.7
   Advertising and public relations........................         3,972              8,560         (4,588)          (53.6)
   Lending and collection..................................         1,427              5,176         (3,749)          (72.4)
   Other operating expenses................................        17,878             22,554         (4,676)          (20.7)
                                                                 --------            -------        -------            -----
      Total operating expenses.............................       117,422            131,435        (14,013)          (10.7)
Intangible assets amortization expense.....................        11,974             12,750           (776)           (6.1)
                                                                 --------            -------        -------            -----
         Total noninterest expenses........................      $129,396           $144,185       $(14,789)          (10.3)%
                                                                 ========            =======        =======            =====
</TABLE>

     Allfirst's noninterest expenses for the quarter ended June 30, 2000 were
$129.4 million, a $14.8 million (10.3%) decrease from noninterest expenses for
the quarter ended June 30, 1999.  The quarter ended June 30, 1999 included $10.0
million in expenses associated with the Allfirst brand introduction.  Increases
in salaries and other personnel costs were partially offset by lower pension and
health care costs. Reduced depreciation expense contributed to equipment costs
decreasing from 1999. Advertising and public relations expenses for the quarter
ended June 30, 1999 included Allfirst brand introduction related expenses.
Lending and collection expenses declined due to decreases in legal fees and
other lending expenses associated with the Corporations's foreign maritime loan
portfolio. Other operating expenses for the quarter ended June 30, 1999 included
costs related to year 2000 compliance as well as associated with the new
Allfirst brand name. Other operating expenses also declined compared to 1999 due
to lower deferred compensation costs in the current quarter.


                                       17
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)


The following table presents the components of noninterest expenses for the six
months ended June 30, 2000 and 1999.


                              Noninterest Expenses


<TABLE>
<CAPTION>
                                                                       Six Months Ended
                                                                           June 30,                     Net Change
                                                                  --------------------------            ----------
<S>                                                               <C>           <C>           <C>             <C>
                                                                  2000                 1999         Dollar          Percent
                                                                  ----                 ----         ------          -------
                                                                                   (dollars in thousands)
Salaries and other personnel costs.........................      $135,681           $137,244       $ (1,563)           (1.1%)
Equipment costs............................................        22,932             24,534         (1,602)           (6.5)
Occupancy costs............................................        18,550             18,253            297             1.6
Other operating expenses:
   Postage and communications..............................        10,059             10,590           (531)           (5.0)
   Advertising and public relations........................         6,958             10,551         (3,593)          (34.1)
   Lending and collection..................................         3,361             10,086         (6,725)          (66.7)
   Other operating expenses................................        33,366             40,411         (7,045)          (17.4)
                                                                 --------            -------        -------            -----
      Total operating expenses.............................       230,907            251,669        (20,762)           (8.3)
Intangible assets amortization expense.....................        23,836             25,514         (1,678)           (6.6)
                                                                 --------            -------        -------            -----
         Total noninterest expenses........................      $254,743           $277,183       $(22,440)           (8.1)%
                                                                 ========            =======        =======            =====
</TABLE>
     Allfirst's noninterest expenses for the six months ended June 30, 2000 were
$254.7 million, a $22.4 million (8.1%) decrease from noninterest expenses for
the six months ended June 30, 1999.  The six months ended June 30, 1999 included
$10.0 million in expenses associated with the Allfirst brand introduction.
Salaries and other personnel costs decreased due to lower health care and
pension costs that were partially offset by increases in salaries and
incentives. Equipment costs decreased due to reduced depreciation expense, which
partially offset increased equipment rental expense and equipment maintenance
and repairs. Advertising and public relations expenses for the six months ended
June 30, 1999 included expenses related to the Allfirst brand introduction.
Lending and collection expenses declined due to decreases in legal fees and
other lending expenses associated with the Corporation's foreign maritime loan
portfolio. Other operating expenses for the six months ended June 30, 1999
included contract programming costs related to year 2000 compliance, and costs
associated with the new Allfirst brand introduction. Other operating expenses
also declined compared to 1999 due to a decrease in expenses related to the
foreign maritime loan portfolio and a decrease in deferred compensation costs.


                                       18
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)


ANALYSIS OF FINANCIAL CONDITION

     Allfirst's total assets at June 30, 2000 were $18.0 billion, a $535 million
increase from total assets of $17.5 billion at December 31, 1999.  Other assets
increased $286 million primarily due to a $179 million investment in bank owned
life insurance and an increase in the fair value of derivative contracts. The
investment in bank owned life insurance was funded by investment securities
sales in 1999. Additional increases in assets were $199 million in net loans,
primarily in commercial loans, as well as a $43 million increase in loans held-
for-sale.

     Investment securities available for sale at June 30, 2000 of $4.2 billion
had net unrealized losses of  $161 million compared to net unrealized losses of
$157 million at December 31, 1999.  The taxable equivalent yield on the entire
securities portfolio for the quarter ended June 30, 2000 was 6.28% compared to
6.11% for the second quarter of 1999.  Investment securities sold in the first
six months of 2000 totaled $143 million and generated pretax gains of $175
thousand.  In the first half of 2000, Allfirst purchased $260 million of
investment securities partially offsetting $255 million of maturities, calls and
paydowns of securities and the $143 million of securities sold.

     Loans and leases increased $199 million when compared to December 31, 1999.
Growth in commercial loans, commercial real estate loans, and commercial and
retail leases receivable were offset by declines in the retail, residential
mortgage, and foreign loan portfolios.  Commercial loans increased $249 million,
with growth primarily in loans to mid-sized and large corporate customers in
Maryland and Pennsylvania.  The Commercial real estate portfolio increased $23
million.   Low vacancy levels and stable to increasing rents have created a
favorable market for real estate financing.  Residential mortgage loans declined
as part of Allfirst's ongoing strategy to hold residential mortgages in the form
of mortgage backed securities rather than as loans.  Retail loans declined $49
million from year end primarily due to a decline in auto loans.  Commercial
leases increased $17 million from year end primarily in the rail car sector.
Foreign loans decreased $31 million due to a decline in foreign maritime loans.
The foreign maritime portfolio is expected to continue to decline in 2000 as the
workout of problem credits continues.

     Significant fluctuations in liabilities included a $281 million decline in
total deposits from December 31, 1999 with a decrease in purchased deposits of
-----
$364 million being partially offset by an increase of $90 million in noninterest
bearing deposits.  Federal funds purchased and securities sold under repurchase
agreements increased $1.0 billion when compared to December 31, 1999, partially
offsetting the $364 million decrease in purchased deposits and a $158 million
decrease in other short-term borrowings, while supporting asset growth of $535
million.

                                       19
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)

Asset Quality

     Nonperforming assets were $95.5 million at June 30, 2000, compared to $80.5
million at December 31, 1999, an increase of $15.0 million. Nonaccrual loans
increased $11.6 million.  Additions to nonperforming loans in the first six
months of 2000 aggregated $55.8 million. These additions were offset by
reductions in nonaccrual loans totaling $44.2 million, comprised of paydowns and
payoffs of nonaccrual loans totaling $20.4 million, charge-offs of $13.2
million, loans returned to accrual status of $6.6 million and transfers to other
real estate and other assets owned of $4.0 million.

     During the first quarter of 2000, Allfirst placed a $22.5 million credit
relationship with a large healthcare provider on nonaccrual. This healthcare
provider has been impacted by recent reductions in Medicare/Medicaid
reimbursements.  As a result of a partial loan sale and charge-offs, this
exposure was reduced to $10.5 million at June 30, 2000.  Aside from this
relationship, there has been no appreciable change in the risk profile of the
healthcare loan portfolio over the last four quarters.  At June 30, 2000,
Allfirst's exposure to the healthcare industry totaled approximately $851
million, including outstanding loans of $320 million, letters of credit of $358
million and unfunded loan commitments and risk participations of $173 million.
With the exception of the $10.5 million credit relationship, there were no other
nonaccrual healthcare loans at either June 30, 2000 or December 31, 1999.

     Over the last two years, Allfirst's foreign maritime loan portfolio has
been negatively affected by economic adversity in certain international markets,
particularly Asia, that depressed the dry bulk and tanker shipping industries.
Although some volatility continues to exist, the signs of improvement shown by
the dry bulk shipping industry in 1999 have continued in 2000.  The tanker
market has also recently shown signs of improvement.  At June 30, 2000,
Allfirst's total international maritime exposure was $206 million, including
loans and leases of  $175 million, $13 million in other foreign maritime assets,
and $18 million in unfunded loan commitments, letters of credit and risk
participations. Nonperforming assets at June 30, 2000 included $4.1 million in
nonaccrual foreign maritime loans and $19.0 million in other nonperforming
maritime assets compared to $6.5 million in nonaccrual foreign maritime loans
and $15.8 million in other nonperforming maritime assets at December 31, 1999.
Other nonperforming assets are classified as such because 1) the structure of
these loans provides compensation for increased risk by incorporating revenue
sharing rights and other collateral rights, which will be triggered by certain
events, into the loan agreement and 2) the value of the loan collateral is equal
to the loan principal.  These loans have been valued based on the estimated cash
flows from the shipping vessels' operations as well as independent valuations.

     During the first quarter of 2000, Allfirst implemented an improved
methodology for determining the appropriate level of the allowance for loan and
lease losses for the commercial, commercial real estate, and foreign loan
portfolios and the commercial lease portfolio.  The improved methodology, which
utilizes probability of default and loss in the event of default ratios, results
in graduated reserve percentages by risk rating and accrual status.  From
December 31, 1999 to June 30, 2000, allocated reserves on the commercial
portfolios increased by $14 million mainly due to the higher level of nonaccrual
loans.  Reserves for commercial real estate decreased by $3.2 million reflecting
the low level of classified assets and non-accruals.  Reserves allocated to the
foreign maritime portfolio declined by $4.1 million due to stabilizing
collateral values, risk profiles and loan paydowns.

     Reserves allocated to specific portfolios are Allfirst's best estimate of
inherent losses within a range of credit losses given the current economic
climate.  Unallocated reserves are available to support losses that are probable
within the high end of the loss range as determined by statistical methods.  As
of June 30, 2000, the unallocated reserve represented 36.1% of the total
allowance for loan and lease losses.

                                       20
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)


     The provision for loan and lease losses for the first six months of 2000
was $16.9 million, a decrease of $4.1 million from the $21.0 million provision
for the first six months of 1999.  Net charge-offs decreased $4.1 million
compared to the first half of 1999. The decrease in net charge-offs was
primarily due to a $7.5 million decrease in foreign maritime net charge-offs
which were offset by increases in commercial charge-offs.

     The following tables detail information on the allowance for loan and lease
losses and net charge-offs for the six months ended June 30, 2000 and 1999 and
nonperforming assets at June 30, 2000 and December 31, 1999.


                             Asset Quality Analysis

ALLOWANCE FOR LOAN AND LEASE LOSSES
<TABLE>
<CAPTION>
                                                                                           Six Months Ended
                                                                                               June 30,
                                                                                  -------------------------------
<S>                                                                                 <C>             <C>
                                                                                      2000               1999
                                                                                   -----------         ----------
                                                                                           (in thousands)
Beginning balance....................................                               $157,351              $157,351
Provision for loan and lease losses..................                                 16,875                20,979
Net charge-offs......................................                                (16,875)              (20,979)
Allowance attributable to loans sold.................                                    -                     -
                                                                                   -----------          ----------
   Ending balance....................................                               $157,351              $157,351
                                                                                   ===========          ==========
</TABLE>

ANNUALIZED NET CHARGE-OFFS (RECOVERIES) AS A PERCENTAGE OF AVERAGE LOANS BY
CATEGORY

<TABLE>
<S>                                                                               <C>             <C>
Commercial loans.....................................                                  0.47%                0.17%
Commercial real estate loans.........................                                  0.01                (0.11)
Residential mortgages................................                                  0.21                 0.55
Retail loans.........................................                                  0.37                 0.58
Commercial leases receivable.........................                                  0.05                    -
Retail leases receivable.............................                                  0.61                 0.43
Foreign loans........................................                                  0.66                 5.00
                                                                                       ----                 ----
  Total..............................................                                  0.31%                0.40%
</TABLE>

                                       21
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)

     The following table details information on nonperforming assets at June 30,
2000 and December 31, 1999.


NONPERFORMING ASSETS
<TABLE>
<CAPTION>
                                                                                      June 30,       December 31,
                                                                                        2000             1999
                                                                                    -----------    ---------------
                                                                                            (in thousands)
<S>                                                                                <C>              <C>
Nonaccrual loans:
Domestic:
   Commercial................................................................        $30,226          $13,496
   Commercial real estate....................................................          9,471            8,151
   Residential mortgage......................................................         17,560           20,511
   Commercial leases receivable..............................................            643              264
Foreign......................................................................          5,468            9,302
                                                                                     -------          -------
       Total nonaccrual loans................................................         63,368           51,724
Other real estate and assets owned (1).......................................         13,023           12,971
Other (2)....................................................................         19,060           15,767
                                                                                     -------          -------
       Total nonperforming assets............................................        $95,451          $80,462
                                                                                     =======          =======

 Accruing loans contractually past due 90 days or more as to principal
   or interest...............................................................        $34,915          $31,693
                                                                                     =======          =======
</TABLE>
____________________
(1)  Other real estate and other assets owned represent collateral on loans to
     which Allfirst has taken title.  This property, which is held for resale,
     is carried at fair value less estimated costs to sell.
(2)  Other includes maritime loans discussed in detail under "Nonperforming
     Assets."


ASSET QUALITY RATIOS
<TABLE>
<S>                                                                                  <C>              <C>
                                                                                        June 30,       December 31,
                                                                                          2000             1999
                                                                                       ----------     --------------
Nonperforming assets as a percentage of :
  Total loans, net of unearned income plus other foreclosed assets owned.....              0.87%            0.74%
Allowance for loan and lease losses as a percentage of :
  Period end loans...........................................................              1.43             1.46
  Nonperforming loans........................................................            248.31           304.21

</TABLE>



CAPITAL ADEQUACY AND RESOURCES

     Allfirst's capital strength provides the resources and flexibility to
capitalize on business growth and acquisition opportunities. At June 30, 2000,
Allfirst's Tier 1 risk based capital ratio was 9.58% ($1.5 billion of Tier 1
capital) and its total risk based capital ratio was 12.67% ($2.0 billion of
total risk based capital).  Tier 1 capital consists primarily of common
shareholder's equity and qualifying amounts of subordinated capital trust
preferred securities less goodwill and certain intangible assets, while total
risk-based capital adds qualifying subordinated debt and the allowance for
credit losses, within permitted limits, to Tier 1 capital.  Risk weighted assets
are determined by assigning various levels of risk to different categories of
assets and off-balance-sheet activities.

                                       22
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (continued)

     The Federal Reserve Board's regulatory capital guidelines require a minimum
total capital to risk adjusted assets ratio of 8.0%.  One-half of the 8.0%
minimum must consist of tangible common shareholders' equity (Tier 1 capital).
The leverage ratio measures Tier 1 capital to average assets less goodwill and
other disallowed intangible assets and must be maintained in conjunction with
the risk-based capital standards.  The regulatory minimum for the leverage ratio
is 3.0%; however, this minimum applies only to top rated banking organizations
without any operating, financial or supervisory deficiencies.  Other
organizations (including those experiencing or anticipating significant growth)
are expected to hold an additional capital cushion of at least 100 to 200 basis
points of Tier 1 capital and, in all cases, banking organizations should hold
capital commensurate with the level and nature of all risks, including the
volume and severity of problem loans, to which they are exposed.

  Substantially the same capital requirements are applied to Allfirst's banking
subsidiaries under guidelines issued by the Federal Reserve Board and the Office
of the Comptroller of the Currency.  As illustrated in the following table, at
June 30, 2000 Allfirst and its banking subsidiaries were "well capitalized" as
defined by regulatory authorities.

                            Capital Adequacy Ratios

<TABLE>
<CAPTION>
                                                                                 Regulatory Capital Ratios
                                                                                 -------------------------
                                                                           Tier 1          Total        Leverage
                                                                        -------------  -------------  -------------
<S>                                                                     <C>            <C>            <C>
Allfirst..........................................................           9.58%         12.67%          8.83%
Allfirst Bank.....................................................           9.20          11.33           8.39
Allfirst Financial Center N.A. ...................................          36.80          37.50          16.10
Regulatory Guidelines:
  Minimum.........................................................           4.00           8.00           3.00
  Well Capitalized................................................           6.00          10.00           5.00

</TABLE>

LIQUIDITY

     Dividends from subsidiaries are the primary source of funds for the debt
service requirements of Allfirst Financial Inc.  Dividends from subsidiaries
totaled $70.3 million for the six months ended June 30, 2000.  Management is
confident that the earnings and dividend capacity of its subsidiary banks will
be adequate to service interest obligations on the long-term debt of Allfirst.
On March 24, 2000, Allfirst paid a dividend of $92 million to its sole common
shareholder, Allied Irish Banks, p.l.c. ("AIB").  On July 18, 2000, the Board of
Directors of Allfirst declared a dividend of $46 million, payable to AIB on
September 20, 2000.

Item 3.  Quantitative and Qualitative Disclosures about Market Risk

MARKET RISK MANAGEMENT

  Market risk is the risk of loss arising from adverse changes in the fair value
of financial instruments due to changes in interest rates, exchange rates and
equity prices. The effective management of market risk is essential to achieving
Allfirst's objectives.  As a financial institution, Allfirst's primary market
risk exposure is interest rate risk.

Interest Rate Risk Management

     Management of interest rate risk is effected through adjustments to the
size and duration of the available-for-sale investment portfolio, the duration
of purchased funds and other borrowings, and through the use of off-balance
sheet financial instruments such as interest rate swaps, interest rate caps and
floors, financial futures, and options.  At  June 30, 2000, the interest rate
risk position of Allfirst had not changed significantly from the risk position
at December 31, 1999 and Allfirst's equity at risk and earnings at risk remained
in compliance with Allfirst's policy limits.

                                       23
<PAGE>

Item 3.  Quantitative and Qualitative Disclosures about Market Risk (continued)

Fixed Income, Derivative and Foreign Exchange Risk Management

     Allfirst maintains active securities and derivatives trading positions as
well as foreign exchange trading positions to service the needs of its customers
as well as for its own trading account.  There has been no material change in
the market risk of these portfolios during the first six months of 2000.


                          Part II. - Other Information

Item 1.  Legal Proceedings

     Various legal actions and proceedings are pending involving Allfirst
Financial Inc. or its subsidiaries. Management believes that the aggregate
liability or loss, if any, resulting from such legal actions and proceedings
will not be material to Allfirst's financial condition or results of operations.

Item 6.  Exhibits and Reports on Form 8-K

        (a)  Exhibits

                 The following exhibit is furnished to this Form 10-Q:

                 (27)  Financial Data Schedule

        (b)  Reports on Form 8-K

                 There were no reports on Form 8-K filed during the quarter
          ended June 30, 2000.


                                   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.


                                        Allfirst Financial Inc.


August 14, 2000                         By  /s/ Robert L. Carpenter, Jr.
                                        --------------------------------
                                        Executive Vice President and Controller




                                       24