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 March 31, 1997

                                            OR

               [ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) 
                    OF THE SECURITIES EXCHANGE ACT OF 1934 
                  For the transition period from __________ to _________

                            Commission file number 1-7273
                       _____________________________________ 


                               FIRST MARYLAND BANCORP 
                 (Exact name of registrant as specified in its charter) 


               Maryland                                 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) 

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


          Indicate by check mark whether the registrant (1) has filed all
     reports required to be filed by Section 13 or 15(d) of the Securities
     Exchange Act of 1934 during the preceding 12 months (or for such
     shorter period that the registrant was required to file such reports),
     and (2) has been subject to such filing requirements for the past
     90 days 
                              Yes__X__ No_____ 


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

           All voting stock (594,480,215 shares of Common Stock, $1/7 par
               value) is owned by Allied Irish Banks, p.l.c., an Irish
                              Banking Corporation.






























     <PAGE>
     PAGE 2

     <TABLE>

                                FIRST MARYLAND BANCORP AND SUBSIDIARIES

                                                FORM 10-Q

                                FOR THE QUARTER ENDED MARCH 31, 1997



     <CAPTION>
     Part I.   Financial Information
                                                                                    Page
     <S>                                                                            <C>
               Item 1.  Financial Statements:

                        Consolidated Statements of Income.......................    3

                        Consolidated Statements of Condition....................    4

                        Consolidated Statements of Changes in Stockholders'
                        Equity..................................................    5

                        Consolidated Statements of Cash Flows...................    6

                        Notes to Consolidated Financial Statements..............    7-12




               Item 2.  Management's Discussion and Analysis of Financial
                        Condition and Results of Operations.....................    13-34



     Part II.  Other Information


               Item 6.  Exhibits and Reports on Form 8-K........................    35


     </TABLE>








































     <PAGE>
     PAGE 3



                         Part I - Financial Information

     Item 1.  Financial Statements 
     <TABLE>
                                FIRST MARYLAND BANCORP AND SUBSIDIARIES

                                   CONSOLIDATED STATEMENTS OF INCOME
                                              (Unaudited)


     <CAPTION>
                                                                             Three months ended
                                                                                  March 31,
                                                                           ---------------------
                                                                             1997         1996
                                                                           --------     --------
                                                                               (in thousands)
     <S>                                                               <C>          <C>
     INTEREST INCOME
     Interest and fees on loans........................................    $136,038     $131,233
     Interest on investment securities available-for-sale:
         Taxable.......................................................      38,589       44,103
         Tax-exempt....................................................       1,453        1,664
         Dividends.....................................................         694          350
     Interest on loans held-for-sale...................................       1,918        2,032
     Interest on money market investments..............................       5,923        3,584
                                                                           --------     --------
           Total interest and dividend income..........................     184,615      182,966
                                                                           --------     --------
     INTEREST EXPENSE
     Interest on deposits..............................................      50,476       51,564
     Interest on Federal funds purchased and
       other short-term borrowings.....................................      20,991       22,596
     Interest on long-term debt........................................       4,638        8,932
     Interest on guaranteed preferred beneficial interests in
       Company's junior subordinated debentures........................       4,107         -
                                                                           --------     --------
           Total interest expense......................................      80,212       83,092
                                                                           --------     --------

     NET INTEREST INCOME...............................................     104,403       99,874
     Provision for credit losses (note 4)..............................       9,900        4,000
                                                                           --------     --------
     NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES.............      94,503       95,874
                                                                           --------     --------
     NONINTEREST INCOME
     Service charges on deposit accounts...............................      21,803       18,807
     Trust and investment advisory fees................................       8,433        6,860
     Servicing income..................................................       6,477        5,477
     Mortgage banking income...........................................       6,018        5,198
     Credit card income................................................       1,993        4,099
     Securities gains (losses), net....................................         453         (604)
     Other income......................................................      16,081        9,776
                                                                           --------     --------
           Total noninterest income....................................      61,258       49,613
                                                                           --------     --------
     NONINTEREST EXPENSES
     Salaries and wages................................................      46,058       43,180
     Other personnel costs.............................................      12,403       13,496
     Equipment costs...................................................       9,244        8,656
     Occupancy costs...................................................       8,125        8,195
     Other operating expenses..........................................      26,635       25,785
                                                                           --------     --------
           Total noninterest expenses..................................     102,465       99,312
                                                                           --------     --------
     INCOME BEFORE INCOME TAXES........................................      53,296       46,175
     Income tax expense................................................      19,193       16,106
                                                                           --------     --------
     NET INCOME........................................................     $34,103      $30,069
                                                                           ========     ========

     <FN>
                  See accompanying notes to consolidated financial statements
     </TABLE>






     <PAGE>
     PAGE 4

     <TABLE>
                                            FIRST MARYLAND BANCORP AND SUBSIDIARIES

                                            CONSOLIDATED STATEMENTS OF CONDITION
                                                          (Unaudited)

     <CAPTION>
                                                                          March 31,  December 31,   March 31,
                                                                            1997         1996         1996
                                                                       ------------ ------------  ------------
                                                                                    (in thousands)
     <S>                                                               <C>          <C>          <C>
     ASSETS
     Cash and due from banks ..........................................    $848,615     $842,032    $657,427
     Money market investments (note 2).................................     580,915       75,260     195,381
     Investment securities available-for-sale (note 3).................   2,497,045    2,552,620   2,782,738
     Loans held-for-sale (at cost which approximates fair value).......     102,512      150,742     128,611
     Loans, net of unearned income of $128,223, $130,026
       and $112,133:
         Commercial....................................................   1,779,671    1,731,031   1,867,298
         Real estate,construction......................................     293,988      299,925     282,737
         Real estate,mortgage:
            Residential................................................     828,703      833,045     622,599
            Commercial.................................................   1,144,579    1,153,319     981,603
         Retail........................................................   1,400,160    1,380,767   1,120,105
         Bankcard......................................................     539,416      596,474     654,665
         Leases receivable.............................................     440,206      438,060     340,586
         Foreign.......................................................     355,407      365,824     359,289
                                                                          ---------    ---------   ---------
              Total loans, net of unearned income......................   6,782,130    6,798,445   6,228,882
         Allowance for credit losses (note 4)..........................    (154,806)    (154,802)   (170,853)
                                                                          ---------    ---------   ---------
              Loans, net ..............................................   6,627,324    6,643,643   6,058,029
                                                                          ---------    ---------   ---------
     Premises and equipment............................................     106,636      106,701     102,546
     Due from customers on acceptances.................................       8,876        8,725      11,292
     Other assets......................................................     445,857      411,301     530,007
                                                                          ---------    ---------   ---------
                   Total assets........................................ $11,217,780  $10,791,024 $10,466,031
                                                                        ===========  ===========  ==========
     LIABILITIES AND STOCKHOLDERS' EQUITY
     Domestic deposits: 
         Noninterest bearing deposits .................................  $2,364,148   $2,248,252  $1,958,412
         Interest bearing deposits.....................................   5,188,402    5,135,616   4,867,434
     Interest bearing deposits in foreign banking office...............      92,152      113,830     144,897
                                                                          ---------    ---------   ---------
              Total deposits...........................................   7,644,702    7,497,698   6,970,743
     Federal funds purchased and securities sold under
       repurchase agreements...........................................     615,590      533,547     653,227
     Other borrowed funds, short-term (note 8).........................     844,942      821,477     759,182
     Bank acceptances outstanding......................................       8,876        8,725      11,292
     Accrued taxes and other liabilities...............................     331,090      297,525     369,295
     Long-term debt (note 9)...........................................     209,756      229,742     514,701
     Guaranteed preferred beneficial interests in Company's junior
        subordinated debentures (note 10)..............................     296,344      147,113        -
                                                                          ---------    ---------   ---------
                   Total liabilities...................................   9,951,300    9,535,827   9,278,440
                                                                          ---------    ---------   ---------
     4.50% Cumulative, Redeemable Preferred Stock, $5 par value per
        share, $100 liquidation preference per share; authorized and
        issued 90,000 shares (note 11).................................       7,748        7,700        -
                                                                          ---------    ---------   ---------
     Stockholders' equity:
          7.875% Noncumulative Preferred Stock, Series A, $5 par
            value per share; $25 liquidation preference per share;
            authorized 8,910,000 shares; issued 6,000,000 shares.......      30,000       30,000      30,000
          Common stock, $1/7 par value per share; authorized
            600,000,000 shares; issued 594,480,215 shares..............      84,926       84,926      84,926
          Capital surplus..............................................     198,176      198,176     198,176
          Retained earnings............................................     957,317      926,063     872,956
          Net unrealized gains (losses) on investment securities
            available-for-sale.........................................     (11,687)       8,332       1,533
                                                                          ---------    ---------   ---------
                   Total stockholders' equity..........................   1,258,732    1,247,497   1,187,591
                                                                          ---------    ---------   ---------
                   Total liabilities and stockholders' equity.......... $11,217,780  $10,791,024 $10,466,031
                                                                        ===========  ===========  ==========

     <FN>
                                See accompanying notes to consolidated financial statements
     </TABLE>

     <PAGE>
     PAGE 5


     <TABLE>
                                                      FIRST MARYLAND BANCORP AND SUBSIDIARIES

                                            CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
                                                                    (Unaudited)



     <CAPTION>
                                                                                                     Net
                                                                                                  unrealized
                                                                                                    gains
                                                                                                 (losses) on
                                                                                                  investment
                                                                                                  securities
                                              Preferred      Common       Capital     Retained    available-
                                                Stock         Stock       Surplus     Earnings     for-sale     Total
                                             ------------  -----------  -----------  ----------- ----------- -----------
                                                                         (in thousands)
     <S>                                    <C>           <C>          <C>          <C>          <C>         <C>
     Three months ended March 31, 1996
     ---------------------------------

     Balance at beginning of year...........      $30,000      $84,926     $198,176     $846,058     $24,414  $1,183,574
     Net income.............................                                              30,069                  30,069
     Dividends declared on preferred
     stock..................................                                              (2,955)                 (2,955)
     Change in net cost not yet recognized
       as periodic pension expense..........                                                (216)                   (216)
     Change in net unrealized gains
       (losses) on investment securities
       available-for-sale...................                                                         (22,881)    (22,881)
                                                ---------    ---------    ---------    ---------   ---------   ---------
     Balance at March 31, 1996..............      $30,000      $84,926     $198,176     $872,956      $1,533  $1,187,591
                                               ==========   ==========   ==========   ==========  ==========  ==========


     Three months ended March 31, 1997
     ---------------------------------

     Balance at beginning of year...........      $30,000      $84,926     $198,176     $926,063      $8,332  $1,247,497
     Net income.............................                                              34,103                  34,103
     Dividends declared on preferred
     stock..................................                                              (2,955)                 (2,955)
     Dividends declared on redeemable
     preferred stock........................                                                (101)                   (101)
     Change in net cost not yet recognized
     as periodic pension expense............                                                 255                     255
     Accretion of redeemable preferred
     stock..................................                                                 (48)                    (48)
     Change in net unrealized gains
       (losses) on investment securities
       available-for-sale...................                                                         (20,019)    (20,019)
                                                ---------    ---------    ---------    ---------   ---------   ---------
     Balance at March 31, 1997..............      $30,000      $84,926     $198,176     $957,317    ($11,687) $1,258,732
                                               ==========   ==========   ==========   ==========  ==========  ==========

     <FN>
                                            See accompanying notes to consolidated financial statements
     </TABLE>





















     <PAGE>
     PAGE 6


     <TABLE>
                                                FIRST MARYLAND BANCORP AND SUBSIDIARIES

                                                 CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                              (Unaudited)

     <CAPTION>
                                                                                                Three months ended March 31,
                                                                                              --------------------------------
                                                                                                      1997        1996
                                                                                                    --------    --------
                                                                                                        (in thousands)
     <S>                                                                                         <C>         <C>
     OPERATING ACTIVITIES
       Net income................................................................................    $34,103     $30,069
       Adjustments to reconcile net income to net cash provided by
       operating activities:
         Provision for credit losses.............................................................      9,900       4,000
         Depreciation and amortization...........................................................      9,383       9,366
         Deferred income tax credit..............................................................     (8,889)     (7,935)
         Net (gain) loss on the sale of assets...................................................       (677)        640
         Net decrease (increase) in loans originated for sale....................................     48,230     (12,609)
         Net increase in trading account securities..............................................     (1,011)     (4,712)
         Net decrease (increase) in accrued interest receivable..................................      2,660      (7,266)
         Net increase (decrease) in accrued interest payable.....................................      3,408      (2,818)
         Other, net..............................................................................     24,842     (62,868)
                                                                                                   ---------   ---------
            Net cash provided by (used for) operating activities.................................    121,949     (54,133)
                                                                                                   ---------   ---------
     INVESTING ACTIVITIES
       Proceeds from sales of investment securities available-for-sale...........................    177,465     350,196
       Proceeds from paydowns and maturities of investment securities available-for-sale.........    104,107   8,903,110
       Purchases of investment securities available-for-sale.....................................   (258,950) (9,281,374)
       Net (increase) decrease in short-term investments.........................................   (504,644)    153,992
       Net receipts (disbursements) from lending activities of bank subsidiaries.................      8,695     (95,190)
       Principal collected on loans of nonbank subsidiaries......................................     10,702       6,484
       Loans originated by nonbank subsidiaries..................................................    (13,353)    (12,177)
       Principal payments received under leases..................................................        931       1,042
       Purchases of assets to be leased..........................................................       (844)     (1,410)
       Proceeds from other real estate owned transactions........................................      2,175         121
       Proceeds from the sale of premises and equipment..........................................         57         341
       Purchases of premises and equipment.......................................................     (5,871)     (4,392)
       Other, net................................................................................    (12,109)    (19,305)
                                                                                                   ---------   ---------
            Net cash (used for) provided by investing activities.................................   (491,639)      1,438
                                                                                                   ---------   ---------
     FINANCING ACTIVITIES
       Net increase (decrease) in deposits ......................................................    147,004     (72,439)
       Net increase (decrease) in short-term borrowings..........................................    105,508     (11,760)
       Payments on long-term debt................................................................    (20,000)       -
       Proceeds from the issuance of guaranteed preferred beneficial interests in Company's
         junior subordinated debentures..........................................................    146,817        -
       Cash dividends paid.......................................................................     (3,056)     (2,955)
                                                                                                   ---------   ---------
            Net cash provided by (used for) financing activities.................................    376,273     (87,154)
                                                                                                   ---------   ---------
     Increase (decrease) in cash and cash equivalents ...........................................      6,583    (139,849)
     Cash and cash equivalents at beginning of year..............................................    842,266     797,460
                                                                                                   ---------   ---------
     Cash and cash equivalents at March 31,......................................................   $848,849    $657,611
                                                                                                   =========   =========
     SUPPLEMENTAL DISCLOSURES
       Interest payments.........................................................................    $77,915     $85,910
       Income tax payments.......................................................................      1,654       8,808
     NONCASH INVESTING AND FINANCING ACTIVITIES
       Loan charge-offs..........................................................................     11,353      12,874
       Transfers to other real estate owned......................................................        288         425
     <FN>
                                   See accompanying notes to consolidated financial statements
     </TABLE>











     <PAGE>
     PAGE 7



                     FIRST MARYLAND BANCORP AND SUBSIDIARIES 

                    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
                                      (Unaudited)


     1.  Basis of Presentation 

          The accounting and reporting policies of First Maryland Bancorp
     and subsidiaries (the "Corporation") conform to generally accepted
     accounting principles.  The accompanying unaudited interim
     consolidated financial statements reflect all adjustments which
     are, in the opinion of management, necessary for a fair
     presentation of the financial position and results of operations
     for the interim periods presented.  These unaudited financial
     statements should be read in conjunction with the audited
     consolidated financial statements and related notes included in
     the Corporation's 1996 Annual Report on Form 10-K.  Certain
     amounts in the 1996 consolidated financial statements have been
     reclassified to conform with the 1997 presentation.

          The Corporation adopted Statement of Financial Accounting Standards
     No. 125, "Accounting for Transfers and Servicing of Financial Assets
     and Extinguishments of Liabilities" ("SFAS 125") on January 1, 1997.
     SFAS 125 requires an entity to recognize the financial and servicing
     assets it controls and the liabilities it has incurred and to derecognize
     the financial assets when control has been surrendered in accordance
     with criteria provided in the Statement.  The adoption of SFAS 125 did
     not have a material impact on the financial statements of the Corporation.


     2.  Money Market Investments
     <TABLE>
          Money market investments at March 31, 1997, December 31, 1996
     and March 31, 1996 included the following:
     <CAPTION>
                                                             March 31,  December 31,   March 31,
                                                               1997         1996         1996
                                                          ------------ ------------- ------------
                                                                       (in thousands)
     <S>                                                  <C>          <C>          <C>
     Interest bearing deposits in other banks.............        $234         $234         $184
     Trading account securities...........................       1,011          -          5,038
     Federal funds sold...................................     396,650       32,975       35,200
     Securities purchased under agreements
       to resell..........................................     183,020       42,051      154,959
                                                              --------     --------     --------
           Total money market investments.................    $580,915      $75,260     $195,381
                                                              ========     ========   ==========
     </TABLE>

     3.  Investment Securities 
     <TABLE>
          The following is a comparison of the amortized cost and fair values of the
     available-for-sale securities:

     <CAPTION>
                                                                March 31, 1997          December 31, 1996         March 31, 1996
                                                            ---------------------     ---------------------   ----------------------
                                                            Amortized       Fair      Amortized       Fair     Amortized      Fair
                                                              Cost          Value       Cost          Value      Cost         Value
                                                           -----------   ----------  -----------  ----------   --------- ----------
                                                                                          (in thousands)
     <S>                                                  <C>          <C>          <C>          <C>         <C>         <C>
     U.S. Treasury and U.S. Government Agencies...........    $623,904     $612,095     $614,843    $611,061    $932,111   $926,270
     Mortgage-backed obligations..........................   1,118,119    1,101,485    1,161,369   1,159,649   1,234,154  1,224,853
     Collateralized mortgage obligations:
        Issued by Federal Agencies........................     317,981      319,280      345,357     348,433     357,054    360,172
        Privately issued..................................      17,433       17,031       20,627      20,223      29,094     28,310
     Asset-backed securities.............................      226,985      225,389      204,657     206,422       9,754      9,795
     Obligations of states and political
        subdivisions......................................      88,393       92,091       93,987      98,889      93,519     98,719
     Other investment securities..........................     123,388      129,674       97,757     107,943     124,395    134,619
                                                            ----------   ----------   ----------  ----------  ---------- ----------
           Total..........................................  $2,516,203   $2,497,045   $2,538,597  $2,552,620  $2,780,081 $2,782,738
                                                            ==========   ==========   ==========  ==========  ========== ==========
     </TABLE>



     <PAGE>
     PAGE 8

                          FIRST MARYLAND BANCORP AND SUBSIDIARIES 

                    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
                                           (Unaudited)


     4.  Impaired Loans and Allowance for Credit Losses

     <TABLE>
          The following table presents impaired loans by type and any related
     valuation allowance at March 31, 1997.
     <CAPTION>
                                                                         Impaired      Impaired
                                                               Total    Loans with    Loans with    Related
                                                             Impaired  No Valuation  a Valuation   Valuation
                                                               Loans     Allowance     Allowance   Allowance
                                                             --------  ------------  ------------  ----------
                                                                                (in thousands)
     <S>                                                  <C>          <C>          <C>          <C>
       Commercial ........................................     $17,781      $10,851       $6,930      $1,875
       Real estate, construction..........................       2,912        2,912          -            -
       Real estate mortgage, commercial...................      16,437       15,901          536         185
                                                              --------     --------     --------    --------
             Total........................................     $37,130      $29,664       $7,466      $2,060
                                                              ========     ========     ========    ========
     </TABLE>
     <TABLE>
          The following table presents impaired loans by type and any related
     valuation allowance at December 31, 1996.
     <CAPTION>
                                                                         Impaired      Impaired
                                                               Total    Loans with    Loans with    Related
                                                             Impaired  No Valuation  a Valuation   Valuation
                                                               Loans     Allowance     Allowance   Allowance
                                                             --------  ------------  ------------  ----------
                                                                                (in thousands)
     <S>                                                  <C>          <C>          <C>          <C>
       Commercial ........................................     $13,988      $10,358       $3,630        $632
       Real estate, construction..........................       4,014        4,014          -            -
       Real estate mortgage, commercial...................      16,333       11,076        5,257         182
                                                              --------     --------     --------    --------
             Total........................................     $34,335      $25,448       $8,887        $814
                                                              ========     ========     ========    ========
     </TABLE>
     <TABLE>
          The following table presents impaired loans by type and any related
     valuation allowance at March 31, 1996.
     <CAPTION>
                                                                         Impaired      Impaired
                                                               Total    Loans with    Loans with    Related
                                                             Impaired  No Valuation  a Valuation   Valuation
                                                               Loans     Allowance     Allowance   Allowance
                                                             --------  ------------  ------------  ----------
                                                                                (in thousands)
     <S>                                                  <C>          <C>          <C>          <C>
       Commercial ........................................     $16,604      $15,133       $1,471        $532
       Real estate, construction..........................       1,072          988           84          35
       Real estate mortgage, commercial...................       5,019        4,687          332          85
                                                              --------     --------     --------    --------
             Total........................................     $22,695      $20,808       $1,887        $652
                                                              ========     ========     ========    ========
     </TABLE>




















     <PAGE>
     PAGE 9

                          FIRST MARYLAND BANCORP AND SUBSIDIARIES 

                    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
                                           (Unaudited)


     4.  Impaired Loans and Allowance for Credit Losses (continued)
     <TABLE>
     <CAPTION>
                                                                                     Three months ended March 31,
                                                                                    ------------------------------
                                                                                         1997         1996
                                                                                        --------    --------
                                                                                            (in thousands)
     <S>                                                                            <C>          <C>
     Year-to-date average recorded investment in impaired loans.....................     $35,733     $22,857
     Year-to-date interest income recognized during impairment......................         168          41
     Year-to-date interest income recorded on a cash basis during impairment........         168          41
     </TABLE>

          At March 31, 1997, the majority of the total impaired loans
     were measured using the fair value of the loan's collateral.  The
     $2.1 million and $652 thousand valuation allowances for impaired loans
     at March 31, 1997 and 1996, respectively, and the activity related to
     impaired loans for the three months ended March 31, 1997 and 1996 is
     included in the allowance for credit losses discussed below.

          In certain circumstances, a nonaccrual loan may not meet the
     definition of an impaired loan under Statement of Financial
     Accounting Standards No.  114 and 118, "Accounting by Creditors
     for Impairment of a Loan".  At March 31, 1997, the difference between
     total nonaccrual loans and total impaired loans was $17.2 million
     which included the following: nonaccrual residential loans of $13.4
     million which were considered smaller balance homogeneous loans and
     a $3.8 million nonaccrual foreign loan which is classified as a
     nonaccrual loan due to regulatory requirements but does not meet the
     definition of an impaired loan.

          The provision for credit losses is determined by analyzing the
     status of individual loans, reviewing historical loss experience and
     reviewing the delinquency of principal and interest payments where
     pertinent.  Management believes that all uncollectible amounts have
     been charged off and that the allowance is adequate to cover all losses
     inherent in the portfolio at March 31, 1997.  A summary of the
     activity in the allowance for credit losses for the three months ended
     March 31, 1997 and 1996 follows:
     <TABLE>
     <CAPTION>
                                                                       Three months ended March 31,
                                                                     --------------------------------
                                                                             1997         1996
                                                                           --------     --------
                                                                               (in thousands)
     <S>                                                               <C>          <C>
     Balance at beginning of year......................................    $154,802     $177,621
     Provision for credit losses.......................................       9,900        4,000
     Less: charge-offs, net of recoveries of $1,457 and $2,106.........      (9,896)     (10,768)
                                                                           --------     --------
     Balance at March 31...............................................    $154,806     $170,853
                                                                           ========     ========
     </TABLE>





















     <PAGE>
     PAGE 10

                          FIRST MARYLAND BANCORP AND SUBSIDIARIES 

                    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
                                           (Unaudited)


     5.  Intangible Assets
     <TABLE>
          Intangible assets at March 31, 1997, December 31, 1996 and
     March 31, 1996 included the following:
     <CAPTION>
                                                            March 31,   December 31,  March 31,
                                                               1997         1996         1996
                                                          ------------ ------------- ------------
                                                                       (in thousands)
     <S>                                                  <C>          <C>          <C>
     Goodwill.............................................     $77,114      $79,454      $28,038
     Premium on bankcard receivables......................       7,342        7,986       10,762
     Premium on deposits..................................       6,497        6,729        7,498
     Employment contracts.................................       3,714        3,891          -
     Other................................................         452          787          885
                                                               -------      -------      -------
           Total intangible assets........................     $95,119      $98,847      $47,183
                                                               =======      =======      =======
     </TABLE>

     6.  Mortgage Servicing Rights
     <TABLE>
          Mortgage servicing rights activity for the three months ended
     March 31, 1997 and March 31, 1996 follows:
     <CAPTION>
                                                                        Three months ended March 31,
                                                            -------------------------------------------------
                                                                       1997                      1996
                                                            -----------------------    ----------------------
                                                            Originated    Purchased   Originated    Purchased
                                                            ----------    ---------   ----------    ---------
                                                                             (in thousands)
     <S>                                                  <C>          <C>          <C>          <C>
     Balance at beginning of year.........................        $648       $2,598       $5,033      $1,067
     Capitalized mortgage servicing rights................         162         -             300         -
     Amortization.........................................         (34)         (86)        (501)        (96)
                                                              --------     --------     --------    --------
     Balance at March 31..................................        $776       $2,512       $4,832        $971
                                                              ========     ========     ========    ========
     </TABLE>

          The Corporation analyzes the capitalized mortgage servicing rights
     for impairment on a quarterly basis using a discounted cash flow analysis.
     Impairment losses are determined by stratifying the population of
     mortgage servicing rights based upon the risk characteristics of loan
     type and term.  A valuation allowance is recorded if the unamortized
     mortgage servicing rights exceed their fair value.  At March 31, 1997,
     there was no valuation allowance.




























     <PAGE>
     PAGE 11

                          FIRST MARYLAND BANCORP AND SUBSIDIARIES 

                    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
                                           (Unaudited)


     7.  Valuation Allowance for Other Real Estate Owned

          There was no activity in the valuation allowances for other real
     estate owned for the first three months ended March 31, 1997 and 1996.
     The valuation allowances for other real estate owned had balances of
     $324 thousand and $295 thousand at March 31, 1997 and 1996, respectively.


     8.  Other Borrowed Funds, Short-term
     <TABLE>
          Other borrowed funds, short-term at March 31, 1997, December
     31, 1996 and March 31, 1996 included the following:
     <CAPTION>
                                                            March 31,   December 31,  March 31,
                                                               1997         1996         1996
                                                          ------------ ------------- ------------
                                                                       (in thousands)
     <S>                                                  <C>          <C>          <C>
     Master demand note of the Corporation................    $327,113     $320,619     $358,927
     Bank notes...........................................     350,000      400,000      350,000
     Federal funds purchased-term.........................      85,000       60,000       10,000
     Treasury tax and loan note account...................       6,485       10,965        5,985
     Other................................................      76,344       29,893       34,270
                                                              --------     --------     --------
           Total other borrowed funds, short-term.........    $844,942     $821,477     $759,182
                                                              ========     ========     ========
     </TABLE>

     9.  Long-term Debt
     <TABLE>
          Following is a summary of the long-term debt of the Corporation
     at March 31, 1997, December 31, 1996 and March 31, 1996 which
     is all unsecured:
     <CAPTION>
                                                            March 31,   December 31,  March 31,
                                                               1997         1996         1996
                                                          ------------ ------------- ------------
                                                                       (in thousands)
     <S>                                                  <C>          <C>          <C>
     Floating Rate Medium term bank note due October 2,
         1996.............................................    $   -        $   -         $75,000
     Floating Rate Medium term bank note due October 23,
         1996.............................................        -            -         100,000
     5.72% Medium term bank note due October 31, 1996.....        -            -         100,000
     Floating Rate Medium term bank note due November 1,
         1996.............................................        -            -          50,000
     Floating Rate Medium term bank note due April 20,
         1998.............................................      50,000       50,000         -
     10.375% Subordinated Capital Notes due August 1,
         1999.............................................      59,980       59,977       59,971
     9.15% Notes due June 1, 1996.........................        -            -          10,000
     8.68% Notes due January 31, 1997.....................        -          10,000        9,999
     8.67% Notes due March 20, 1997.......................        -          10,000        9,998
     8.375% Subordinated Notes due May 15, 2002...........      99,776       99,765       99,733
                                                              --------     --------     --------
           Total long-term debt...........................    $209,756     $229,742     $514,701
                                                              ========     ========     ========
     </TABLE>


















     <PAGE>
     PAGE 12


                          FIRST MARYLAND BANCORP AND SUBSIDIARIES 

                    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
                                           (Unaudited)


     10.  Guaranteed Preferred Beneficial Interests in Company's Junior
          Subordinated Debentures

          In December 1996 and February 1997, the Corporation issued an
     aggregate $300 million in Floating Rate Subordinated Capital Income
     Securities ("Capital Securities") through two subsidiaries, First
     Maryland Capital I and First Maryland Capital II.  Both subsidiaries
     are Delaware statutory business trusts ("the Trusts").  The Capital
     Securities represent undivided preferred ownership interests in the
     assets of the Trusts.  The Corporation purchased 9,280 Common Securities
     of the Trusts ($1,000 liquidation amount per security) for a purchase
     price of $9.14 million.  The Trusts used the aggregate proceeds of
     $304.6 million from the issuance of the Capital Securities and the
     Common Securities to purchase $309.3 million aggregate principal
     amount of Floating Rate Junior Subordinated Debentures ("Junior
     Subordinated Debentures") issued by the Corporation which represent
     the sole assets of the Trusts.

          Holders of the Capital Securities are entitled to receive cumulative
     cash distributions at a variable annual rate equal to LIBOR plus 100
     basis points for the $150 million issued in December 1996 and LIBOR plus
     85 basis points for the $150 million issued in February 1997 on the
     liquidation amount of $1,000 per Capital Security.  Interest on the
     Junior Subordinated Debentures is calculated at the same rate as the
     Capital Securities.

          The December 1996 Junior Subordinated Debentures mature on January
     15, 2027 and are redeemable by the Corporation in whole or in part on or
     after January 15, 2007.  The February 1997 Junior Subordinated Debentures
     mature on February 1, 2027 and are redeemable by the Corporation in whole
     or in part on or after February 1, 2007.  The Junior Subordinated
     Debentures are redeemable by the Corporation in whole but not in part,
     upon occurrence of certain special events.  The Capital Securities
     will remain outstanding until the Junior Subordinated Debentures are
     repaid at maturity, are redeemed prior to maturity or are distributed
     in liquidation of the Trusts.


     11.  Redeemable Preferred Stock

          In 1996, the Corporation authorized and issued 90 thousand shares
     of 4.50% Cumulative, Redeemable Preferred Stock with a $5 par value
     and a $100 liquidation preference per share in connection with the
     Zirkin-Cutler acquisition.  The redeemable preferred stock was recorded
     at fair value at the date of issue or $7.6 million.  The carrying
     amount will be increased to the mandatory redemption amount of $9.0
     million by periodic accretions using the interest method with an offset
     to retained earnings.  At March 31, 1997, all 90 thousand shares were
     outstanding and had a balance of $7.7 million.  The cumulative dividends
     are payable quarterly when and as declared by the Corporation's Board
     of Directors out of funds legally available for such payments.

          Upon liquidation, the holders are entitled to $100 per share
     (an aggregate of $9 million based upon redeemable preferred shares
     outstanding at March 31, 1997) plus accrued and unpaid cumulative
     dividends through the distribution date before any distribution to
     holders of the Corporation's common stock.

          Redemption can occur at the Corporation's option or the holders'
     option (on at least 30 days notice but no more than 60 days notice)
     during a redemption period commencing July 1, 2002 and ending June 30,
     2003 at $100 per share (liquidation value) plus accrued and unpaid
     cumulative dividends through the redemption date.












     <PAGE>
     PAGE 13



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


     Earnings Summary

          The net income of First Maryland Bancorp (the "Corporation") for
     the three months ended March 31, 1997 was $34.1 million compared to
     $30.1 million for the three months ended March 31, 1996.  Return on
     average assets and return on average total equity were 1.27% and
     10.90%, respectively, for the three months ended March 31, 1997
     compared to 1.15% and 10.00% for the three months ended March 31, 1996.


     <TABLE>
     Table 1                Selected Quarterly Financial Information

     <CAPTION>

                                                           1st Quarter  4th Quarter  3rd Quarter  2nd Quarter 1st Quarter
                                                               1997         1996         1996         1996        1996
                                                           -----------  -----------  ----------- ----------- -----------
                                                                                    (in thousands)
     <S>                                                  <C>          <C>          <C>          <C>         <C>
     CONSOLIDATED SUMMARY OF OPERATIONS:
        Net interest income (fully tax equivalent)........    $105,531     $106,407     $103,255     $97,898    $101,197
        Tax equivalent adjustment.........................       1,128        1,212        1,289       1,277       1,323
                                                              --------     --------     --------    --------    --------
        Net interest income...............................     104,403      105,195      101,966      96,621      99,874
        Provision for credit losses.......................       9,900          500        2,000         -         4,000
                                                              --------     --------     --------    --------    --------
        Net interest income after provision for credit
          losses..........................................      94,503      104,695       99,966      96,621      95,874
        Noninterest income................................      61,258       56,833       57,384      53,062      49,613
        Noninterest expenses..............................     102,465      105,358      103,023      99,168      99,312
                                                              --------     --------     --------    --------    --------
        Income before income taxes........................      53,296       56,170       54,327      50,515      46,175
        Income tax expense................................      19,193       20,138       20,625      17,981      16,106
                                                              --------     --------     --------    --------    --------
        Net income........................................     $34,103      $36,032      $33,702     $32,534     $30,069
                                                              ========     ========     ========    ========    ========

        Dividends declared on preferred stock.............      $2,955       $2,955       $2,955      $2,955      $2,955
        Dividends declared on redeemable preferred stock..         101          102          101         -           -

     CONSOLIDATED AVERAGE BALANCES:
        Total assets......................................  10,912,900   10,741,800   10,420,400  10,212,700  10,531,200
        Loans, net of unearned income.....................   6,792,700    6,686,500    6,365,900   6,018,700   6,173,600
        Deposits..........................................   7,258,700    7,233,900    7,208,400   6,943,200   6,905,200
        Long-term debt....................................     221,700      303,900      554,700     551,700     514,700
        Common stockholder's equity.......................   1,124,600    1,083,100    1,044,800   1,048,300   1,064,100
        Stockholders' equity..............................   1,269,400    1,227,900    1,189,600   1,193,100   1,208,900

     CONSOLIDATED RATIOS:
        Return on average assets..........................        1.27%        1.33%        1.29%       1.28%       1.15%
        Return on average common stockholder's equity.....       11.20        12.11        11.67       11.35       10.25
        Return on average total stockholders' equity......       10.90        11.67        11.27       10.97       10.00
        Average stockholders' equity to average total
          assets..........................................       11.63        11.43        11.42       11.68       11.48
        Capital to risk-adjusted assets:
          Tier 1..........................................       15.71        14.12        11.94       13.90       13.63
          Total...........................................       18.75        17.20        15.01       17.11       16.78
        Tier 1 leverage ratio.............................       13.68        12.18        10.71       11.19       10.99
        Net interest margin...............................        4.33         4.35         4.36        4.25        4.26
        Net charge-offs to average loans, net of average
          unearned income (annualized)....................        0.59         0.87         0.40        0.44        0.70
        Allowance for credit losses to period end loans,
          net of unearned income..........................        2.28         2.28         2.58        2.72        2.74
        Nonperforming assets to period end loans, net of
          unearned income plus other foreclosed assets
          owned...........................................        0.97         0.87         0.92        0.72        0.73
     </TABLE>








     <PAGE>
     PAGE 14

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


     Net Interest Income and Net Interest Margin

          Net interest income on a fully tax equivalent basis for the
     quarter ended March 31, 1997 of $105.5 million increased $4.3 million
     (4.3%) when compared to net interest income of $101.2 million for the
     quarter ended March 31, 1996.  The net interest margin for the first
     quarter of 1997 was 4.33% compared to a net interest margin of 4.26%
     for the first quarter of 1996.  The following table summarizes the
     items which had a significant impact on net interest income and net
     interest margin in the first quarter of 1997.

     <TABLE>
     Table 2      Net Interest Income and Net Interest Margin Reconciliation
                                    (Tax Equivalent Basis)

     <CAPTION>
                                                   Net           Net
                                                Interest      Interest
                                                 Income        Margin
                                                --------      --------
                                                 (dollars in millions)
     <S>                                    <C>           <C>
     Three months ended March 31, 1996......       $101.2         4.26%
     Bankcard securitization (1)............         (8.5)       (0.21)
     Acquisition of 1st Washington Bancorp,
        Inc. ("1st Washington") (2).........          4.9        (0.06)
     Increased bankcard loan volumes........          3.5         0.05
     Higher level of earning assets.........          3.2         0.18
     Decline in bankcard loan product
        margins.............................         (3.1)       (0.13)
     Increase in net free funds.............          2.9         0.12
     Change in asset yields and funding
        costs...............................          2.2         0.10
     Interest recovery on a nonaccrual
        loan................................          1.2         0.05
     Other changes..........................         (2.0)       (0.03)
                                                  -------       ------
     Three months ended March 31, 1997......       $105.5         4.33%
                                                 ========       ======
     <FN>
     (1)  The bankcard securitization represents the securitization and sale
     of an additional $335 million in bankcard loans in April 1996.  The
     revenues associated with these loans were reported in noninterest
     income as servicing income.

     (2)  The net interest margin of 1st Washington at the date of acquisition
     was significantly lower than the Corporation's net interest margin, which
     was consistent with most thrift institutions.
     </TABLE>





























     <PAGE>
     PAGE 15

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


          An analysis of fully tax equivalent net interest income,
     interest rate spreads and net interest margins for the three months
     ended March 31, 1997 and 1996 is presented in following table.


     <TABLE>
     Table 3      Net Interest Income, Interest Rate Spread and Net Interest Margin on Average Earning Assets
                                              (Tax Equivalent Basis)

     <CAPTION>
                                                                       Three months ended March 31,
                                                 -----------------------------------------------------------------------
                                                                  1997                                  1996
                                                 -----------------------------------    -------------------------------
                                                  Average                    Yield/      Average                  Yield/
                                                  balance     Interest        rate       balance    Interest       rate
                                                 --------     --------     --------     --------    --------    --------
                                                                         (dollars in millions)
     <S>                                    <C>           <C>          <C>          <C>          <C>         <C>
     Investment securities (1)..............     $2,532.4        $41.4         6.63%    $2,988.6       $46.9        6.31%
     Loans held-for-sale....................        101.5          1.9         7.66        115.1         2.0        7.10
     Loans, net of unearned income..........      6,792.7        136.5         8.15      6,173.6       131.8        8.59
     Other earning assets...................        451.9          5.9         5.32        272.0         3.6        5.30
                                                  -------       ------                   -------      ------
     Earning assets.........................     $9,878.5        185.7         7.62     $9,549.3       184.3        7.76
                                                 ========       ------                  ========      ------

     Interest bearing liabilities...........     $7,318.9         80.2         4.44     $7,214.9        83.1        4.63
     Interest rate spread (2)...............                                   3.18                                 3.13
     Interest free sources utilized
       to fund earning assets...............      2,559.6                                2,334.4
                                                  -------       ------                   -------      ------
     Total sources of funds.................     $9,878.5         80.2         3.29     $9,549.3        83.1        3.50
                                                 ========       ------                  ========      ------
     Net interest income....................                    $105.5                                $101.2
                                                                ======                                ======
     Net interest margin (3)................                                   4.33%                                4.26%
                                                                               ====                                 ====
     <FN>
     (1)  Yields on investment securities are calculated based upon average amortized cost.
     (2)  Interest rate spread is the difference between the yield on average earning assets and the rate paid
          on average interest bearing liabilities.
     (3)  Net interest margin is the ratio of net interest income on a fully tax-equivalent basis to
          average earning assets.
     </TABLE>

































     <PAGE>
     PAGE 16

     Item 2.  Management's Discussion and Analysis of Financial
     Condition and Results of Operations-(Continued)
     <TABLE>
     Table 4
                                First Maryland Bancorp and Subsidiaries
                   Average Balances, Interest Rates and Yields and Net Interest Margin
                                          (Tax Equivalent Basis)
     <CAPTION>
                                                            Three months ended March 31, 1997
                                                          -------------------------------------
                                                                                       Average
                                                            Average                     rate/
                                                            Balance       Interest      yield
                                                            -------     -----------  -----------
                                                                    (dollars in millions)
     <S>                                                  <C>          <C>          <C>
     ASSETS
     Cash and due from banks..............................      $636.0      $     -           - %
     Money market investments:
       Interest bearing deposits in other banks...........         0.3            -         4.11
       Trading account securities.........................         5.7            -         5.76
       Funds sold.........................................       445.9          5.9         5.31
     Investment securities available-for-sale:
       Taxable securities.................................     2,394.1         38.6         6.54
       Tax-exempt securities (1)..........................        81.7          2.1        10.45
       Equity investments.................................        56.6          0.7         4.97
                                                             ---------     ---------
          Total securities available-for-sale (2).........     2,532.4         41.4         6.63
     Loans held-for-sale..................................       101.5          1.9         7.66
     Loans, net of unearned income (1,3): 
       Commercial.........................................     1,764.1         34.6         7.96
       Real estate, construction..........................       296.6          6.2         8.46
       Real estate mortgage, commercial...................     1,145.6         23.4         8.30
       Real estate mortgage, residential..................       837.6         14.9         7.22
       Retail.............................................     1,386.3         28.7         8.39
       Bankcard...........................................       563.5         16.1        11.58
       Leases receivable..................................       437.9          6.0         5.56
       Foreign............................................       361.1          6.6         7.39
                                                             ---------     ---------
            Total loans, net of unearned income...........     6,792.7        136.5         8.15
        Allowance for credit losses.......................      (152.9)           -            -
                                                             ---------
          Loans, net......................................     6,639.8            -            -
     Other assets.........................................       551.3            -            -
                                                             ---------     ---------
          Total assets/interest income....................   $10,912.9       $185.7
                                                              ========     ========
     LIABILITIES AND STOCKHOLDERS' EQUITY
     Deposits in domestic offices:
       Noninterest bearing demand.........................    $2,029.2      $     -           - %
                                                             ---------
       Interest bearing demand............................       119.7          0.7         2.34
       Money market accounts..............................     1,623.5         11.6         2.90
       Savings...........................................      1,037.3          6.3         2.47
       Other consumer time................................     1,706.7         21.7         5.15
       Large denomination time............................       630.2          8.7         5.58
     Deposits in foreign banking offices..................       112.1          1.5         5.36
                                                             ---------     ---------
          Total interest bearing deposits.................     5,229.5         50.5         3.91
                                                             ---------     ---------
          Total deposits..................................     7,258.7            -            -
     Funds purchased......................................       710.7          9.0         5.15
     Other borrowed funds, short-term.....................       917.5         12.0         5.29
     Other liabilities....................................       287.7            -            -
     Long-term debt.......................................       221.7          4.6         8.48
     Guaranteed preferred beneficial interests in
        Company's junior subordinated debentures..........       239.5          4.1         6.95
     Redeemable preferred stock...........................         7.7            -            -
     Stockholders' equity.................................     1,269.4            -            -
                                                             ---------     ---------
          Total liabilities and stockholders'
             equity/interest expense......................   $10,912.9        $80.2
                                                              ========     ========

     Earning assets/interest income.......................    $9,878.5       $185.7         7.62%
     Interest bearing liabilities/interest expense........     7,318.9         80.2         4.44
     Earning assets/interest expense......................     9,878.5         80.2         3.29

     Interest rate spread (4).............................                                  3.18%
                                                                                           =====
     Net interest margin (5)..............................                                  4.33%
                                                                                           =====
     </TABLE>




















































































     <PAGE>
     PAGE 17

     Item 2.  Management's Discussion and Analysis of Financial
     Condition and Results of Operations-(Continued)
     <TABLE>
     Table 5
                                First Maryland Bancorp and Subsidiaries
                   Average Balances, Interest Rates and Yields and Net Interest Margin
                                          (Tax Equivalent Basis)
     <CAPTION>
                                                            Three months ended March 31, 1996
                                                           ------------------------------------
                                                                                       Average
                                                            Average                     rate/
                                                            Balance       Interest      yield
                                                            -------     -----------  -----------
                                                                    (dollars in millions)
     <S>                                                  <C>          <C>          <C>
     ASSETS
     Cash and due from banks..............................      $664.0      $     -           - %
     Money market investments:
       Interest bearing deposits in other banks...........        13.4          0.2         5.80
       Trading account securities.........................         0.9            -         5.49
       Funds sold.........................................       257.7          3.4         5.27
     Investment securities available-for-sale:
       Taxable securities.................................     2,858.6         44.1         6.21
       Tax-exempt securities (1)..........................        96.2          2.4        10.07
       Equity investments.................................        33.8          0.4         4.16
                                                             ---------     ---------
          Total securities available-for-sale (2).........     2,988.6         46.9         6.31
     Loans held-for-sale..................................       115.1          2.0         7.10
     Loans, net of unearned income (1,3): 
       Commercial.........................................     1,830.5         35.0         7.69
       Real estate, construction..........................       283.9          6.3         8.89
       Real estate mortgage, commercial...................       973.1         21.6         8.92
       Real estate mortgage, residential..................       637.8         11.8         7.45
       Retail.............................................     1,105.2         23.3         8.49
       Bankcard...........................................       657.8         22.6        13.80
       Leases receivable..................................       335.0          4.6         5.54
       Foreign............................................       350.3          6.6         7.65
                                                             ---------     ---------
            Total loans, net of unearned income...........     6,173.6        131.8         8.59
        Allowance for credit losses.......................      (174.0)           -            -
                                                             ---------
          Loans, net......................................     5,999.6            -            -
     Other assets.........................................       491.9            -            -
                                                             ---------     ---------
          Total assets/interest income....................   $10,531.2       $184.3
                                                              ========     ========
     LIABILITIES AND STOCKHOLDERS' EQUITY
     Deposits in domestic offices:
       Noninterest bearing demand.........................    $1,900.3      $     -           - %
                                                             ---------
       Interest bearing demand............................       115.8          0.7         2.55
       Money market accounts..............................     1,550.0         12.1         3.13
       Savings...........................................      1,022.6          6.9         2.71
       Other consumer time................................     1,623.1         22.0         5.46
       Large denomination time............................       556.0          8.0         5.77
     Deposits in foreign banking offices..................       137.4          1.9         5.50
                                                             ---------     ---------
          Total interest bearing deposits.................     5,004.9         51.6         4.14
                                                             ---------     ---------
          Total deposits..................................     6,905.2            -            -
     Funds purchased......................................       849.5         11.1         5.23
     Other borrowed funds, short-term.....................       845.8         11.5         5.49
     Other liabilities....................................       207.1            -            -
     Long-term debt.......................................       514.7          8.9         6.98
     Stockholders' equity.................................     1,208.9            -            -
                                                             ---------     ---------
          Total liabilities and stockholders'
             equity/interest expense......................   $10,531.2        $83.1
                                                              ========     ========

     Earning assets/interest income.......................    $9,549.3       $184.3         7.76%
     Interest bearing liabilities/interest expense........     7,214.9         83.1         4.63
     Earning assets/interest expense......................     9,549.3         83.1         3.50

     Interest rate spread (4).............................                                  3.13%
                                                                                           =====
     Net interest margin (5)..............................                                  4.26%
                                                                                           =====
     </TABLE>


     <PAGE>
     PAGE 18

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


     ----------------
     (1) Interest on loans to and obligations of public entities is not
         subject to Federal income tax.  In order to make pre-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) Interest rate 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.



     Provision for Credit Losses 

         The provision for credit losses for the three months ended March
     31, 1997 totaled $9.9 million, a $5.9 million increase (147.5%) from the
     $4.0 million provision recorded in the three months ended March 31,
     1996.  The 1997 provision for credit losses included a $13.7 million
     provision for bankcard loans offset by provision recaptures of $4.2
     million at a bank subsidiary and a leasing subsidiary.  The 1996
     provision for credit losses included a $7.7 million provision for
     bankcard loans offset by $3.7 million in provision recaptures at
     subsidiary banks.


















































     <PAGE>
     PAGE 19

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


     Noninterest Income
     <TABLE>
          The following table presents the components of noninterest income
     for the three months ended March 31, 1997 and 1996.


     Table 6                     Noninterest Income
     <CAPTION>
                                                   Three months ended March 31,
                                                ----------------------------------
                                                                           Percent
                                                                           Change
                                                    1997          1996    1997/1996
                                                  -------      -------   -----------
                                                        (dollars in thousands)
     <S>                                    <C>           <C>          <C>
     Service charges on deposit accounts....      $21,803      $18,807         15.9%
     Trust and investment advisory fees.....        8,433        6,860         22.9
     Servicing income.......................        6,477        5,477         18.3
     Mortgage banking income................        6,018        5,198         15.8
     Credit card income.....................        1,993        4,099        (51.4)
     Securities gains (losses), net.........          453         (604)      (175.0)
     Other income:
       Customer service fees................        1,947        1,963         (0.8)
       Trading income.......................        1,583        1,151        (37.5)
       Security sales and fees..............        1,191        1,180          0.9
       Other................................       11,360        5,482        107.2
                                                  -------      -------        -----
     Total other income.....................       16,081        9,776         64.5
                                                  -------      -------        -----
            Total noninterest income........      $61,258      $49,613         23.5%
                                                  =======      =======      =======
     </TABLE>

          The Corporation's noninterest income for the first quarter of
     1997 increased $11.6 million (23.5%) when compared to the first quarter
     of 1996.  Service charges on deposits increased $3.0 million (15.9%)
     due to increases in retail deposit and business checking service
     charges.  Trust and investment advisory fees increased $1.6 million
     (22.9%) as a result of increases in investment management and advisory
     fees and custody fees.  Zirkin-Cutler Investments, Inc. ("Zirkin-
     Cutler"), acquired on July 1, 1996, generated $795 thousand in
     investment advisory fees in the first quarter of 1997.  Servicing
     income increased $1.0 million (18.3%) primarily due to the bankcard
     securitization.  Mortgage banking income increased $820 thousand
     (15.8%) as a result of an increase in gains on the sale of mortgages
     which was partially offset by declines in gains on the sale of servicing
     and commercial mortgage loan placement fees.  Credit card income
     declined $2.1 million (51.4%) due to the bankcard securitization which
     shifted $2.2 million in credit card fee income to servicing income.
     Securities gains of $453 thousand were recorded in the first quarter
     of 1997 compared to securities losses of $604 thousand in the first
     quarter of 1996.  Securities sales are discussed in detail under
     "Changes in Financial Position".  Other income increased $5.9 million
     (107.2%) due to a $5.5 million gain on the sale of the Corporation's
     investment in an ATM and point-of-sale network system in the first
     quarter of 1997.





















     <PAGE>
     PAGE 20

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


     Noninterest Expenses
     <TABLE>
          The following table presents the components of noninterest expenses
     for the three months ended March 31, 1997 and 1996.


     Table 7                        Noninterest Expenses

     <CAPTION>
                                                   Three months ended March 31,
                                                ----------------------------------
                                                                           Percent
                                                                           Change
                                                    1997          1996    1997/1996
                                                  -------      -------   -----------
                                                        (dollars in thousands)
     <S>                                    <C>           <C>          <C>
     Salaries and wages.....................      $46,058      $43,180          6.7%
     Other personnel costs..................       12,403       13,496         (8.1)
     Equipment costs........................        9,244        8,656          6.8
     Occupancy costs.......................         8,125        8,195         (0.9)
     Other operating expenses:
       External services....................        7,241        5,480         32.1
       Postage and communications...........        4,620        4,099         12.7
       Advertising..........................        4,080        3,701         10.2
       Professional service fees............        2,288        1,860         23.0
       Lending and collection...............        1,317        1,427         (7.7)
       Regulatory insurance and fees........          520          858        (39.4)
       Other................................        6,569        8,360        (21.4)
                                                   ------       ------        -----
         Total other operating expenses.....       26,635       25,785          3.3
                                                   ------       ------        -----
             Total noninterest expenses.....     $102,465      $99,312          3.2%
                                                  =======      =======      =======
     </TABLE

          The Corporation's noninterest expenses for the first quarter of
     1997 increased $3.2 million (3.2%) when compared to the first quarter
     of 1996.  Salaries and wages increased $2.9 million (6.7%) as a result
     of increased employee incentives and commissions and the 1st Washington
     acquisition in July 1996.  Other personnel costs decreased $1.1 million
     (8.1%) as a result of a $1.8 million decline in pension costs primarily
     due to an executive retirement in the first quarter of 1996.  This
     decline was partially offset by a $643 thousand increase in healthcare
     costs.  Equipment costs increased $588 thousand (6.8%) due to higher
     equipment maintenance contract costs in 1997.  External services increased
     $1.8 million (32.1%) as a result of higher servicing costs associated
     with the bankcard loan portfolio and processing costs associated with
     a government automated tax payment program.  Postage and communications
     increased $521 thousand (12.7%) primarily due to growth in banking
     relationships, including bankcard and 1st Washington.



























     <PAGE>
     PAGE 21

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


     Changes in Financial Position


     Investment Securities

          Available-for-Sale Portfolio

          Investment securities available-for-sale decreased $55.6 million
     from December 31, 1996 to March 31, 1997.  In the first quarter of 1997,
     the Corporation sold $177.0 million in investment securities which
     resulted in net gains of $453 thousand.  These sales included $100.1
     million in U.S. Treasury securities, resulting in $54 thousand in losses;
     $66.6 million in collateralized mortgage obligations ("CMO's"),
     resulting in gains of $50 thousand; $3.3 million in other debt
     securities, resulting in $476 thousand in gains and $7.0 million in
     equity securities, resulting in $19 thousand in losses.  Paydowns,
     maturities and calls in the available-for-sale portfolio totaled $104.1
     million.  These decreases in the portfolio were partially offset by
     $259.0 million in purchases in the first quarter of 1997 which included
     the following:  $115.3 million in U.S. Treasury and U.S. Government
     Agencies securities, $90.9 million in CMO's, $44.2 million in other debt
     securities and $8.6 million in equity securities.  The fair value of
     the available-for-sale portfolio at March 31, 1997 was $19.2 million
     below the amortized cost compared to a fair value at December 31, 1996
     which was $14.0 million above the amortized cost.  This change in the
     fair value resulted in a $20.0 million adjustment (net of income taxes)
     to the unrealized gains (losses) on available-for-sale securities which
     is included as a component of stockholders' equity.  Table 8 provides
     a summary of the gross unrealized gains and losses of the available-
     for-sale portfolio at March 31, 1997.


     
</TABLE>
<TABLE>
     Table 8                    Available-for-Sale Portfolio
     <CAPTION>
                                                                            March 31, 1997
                                                            -------------------------------------------------
                                                                            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...........    $623,904       $1,159     ($12,968)   $612,095
     Mortgage-backed obligations..........................   1,118,119        5,752      (22,386)  1,101,485
     Collateralized mortgage obligations:
        Issued by Federal Agencies........................     317,981        3,798       (2,499)    319,280
        Privately issued..................................      17,433            1         (403)     17,031
     Asset-backed securities..............................     226,985          401       (1,997)    225,389
     Obligations of states and political
        subdivisions......................................      88,393        4,144         (446)     92,091
     Other debt securities................................      71,169            -            -      71,169
     Equity securities....................................      52,219        6,461         (175)     58,505
                                                             ---------    ---------    ---------   ---------
           Total..........................................  $2,516,203      $21,716     ($40,874) $2,497,045
                                                            ==========   ==========   ==========  ==========
     </TABLE>





















     <PAGE>
     PAGE 22


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


     Loan Portfolio

          Total loans, net of unearned income declined $16.3 million (0.2%)
     from $6.798 billion at December 31, 1996 to $6.782 billion at March 31,
     1997.  Seasonally lower bankcard receivables were partially offset by
     increases in commercial loans.

          Commercial loans increased $48.6 million (2.8%) from December 31,
     1996 to March 31, 1997.  Month-end balances can show some fluctuations
     due to the transactional nature of large corporate customers that borrow
     for short periods of time under revolving facilities.  Growth in
     specialized lending sectors, primarily Communications lending,
     contributed to the year to date increase.

          Commercial real estate loans, which include both construction and
     commercial mortgages, declined $14.7 million (1.0%) from December 31,
     1996 to March 31, 1997.  The commercial real estate portfolio continues
     to be well-balanced by property type and geographically centered in the
     Corporation's regional marketplace as reflected in Tables 10 and 11.

          Residential mortgages decreased $4.3 million (0.5%) from December
     31, 1996 to March 31, 1997.  The Corporation originates residential
     mortgages primarily for sale in the secondary market.  New originations
     retained for the Corporation's permanent residential mortgage portfolio
     principally consist of low income housing and adjustable rate products.

          Retail loans increased $19.4 million (1.4%) from December 31, 1996
     to March 31, 1997.  The continued retail loan growth resulted primarily
     from a home equity credit product promotion which began in late February.

          Bankcard outstandings decreased $57.1 million (9.6%) since
     December 31, 1996.  This reduction reflected seasonal paydowns following
     the year end holiday shopping season.

          Leases receivable increased $2.1 million (0.5%) since December
     31, 1996.  Retail leases, which represent 11% of outstandings, increased
     $1.6 million (3.4%).

          Foreign loans declined $10.4 million (2.8%) from December 31,
     1996 to March 31, 1997.  The decline occurred primarily in the Latin
     American portfolio.

          The Corporation monitors exposure based on industry classifications
     and established limits that are reviewed by the Board of Directors.
     Significant exposures by industry classification in the loan portfolio
     are presented in Table 9.































     <PAGE>
     PAGE 23

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

     <TABLE>
     Table 9              Loan Portfolio Distribution by Industry Classification
     <CAPTION>
                                                                            March 31, 1997
                                                          ----------------------------------------------------
                                                           Outstanding    Unfunded      Total    Nonperforming
                                                             Balance    Commitments    Exposure      Loans
                                                           -----------  -----------   ---------- ------------
                                                                              (in thousands)
     <S>                                                  <C>          <C>          <C>          <C>
        Transportation (1)................................    $533,819      $67,492     $601,311      $  -
        Communications (2)................................     405,973      130,689      536,662       2,309
        Healthcare (3)....................................     367,550      120,799      488,349       1,146
     <FN>
     ----------------
     (1)  Includes loans and leases for vessel, commercial aircraft and railroad equipment financing.
     (2)  Includes exposure to cable, publishing/newspapers, wireless communications and broadcasting.
     (3)  Includes exposure to hospitals, nursing care and noninstitutional borrowers, comprised of
          both commercial and real estate secured loans.
     </TABLE>
     <TABLE>
     Table 10              Loans Secured by Real Estate and Other Real Estate Owned by Property Type
     <CAPTION>
                                                                           March 31, 1997
                                                            -------------------------------------------------
                                                                  Total loans
                                                           ------------------------                  Other
                                                           Real estate  Real estate Nonperforming real estate
                                                           construction   mortgage      loans        owned
                                                          ------------- ----------- ------------- -----------
                                                                            (in thousands)
     <S>                                                  <C>          <C>          <C>          <C>
     Office buildings.....................................     $84,991     $334,549       $1,156      $   -
     Industrial warehouse.................................      46,649      201,509        5,256          -
     Retail...............................................      47,285      182,358        2,526       4,090
     Hospitals/nursing home...............................      21,284      108,817          -            -
     Hotels/motels........................................         -         58,106          -            -
     Commercial land......................................      22,882          407          416       4,972
     Special purpose......................................       5,982       89,453        1,347          -
     Apartments...........................................      31,058       61,927        5,429          -
     Mixed use............................................         218       47,789          -            -
     Residential land.....................................      23,786        1,632          -            -
     Other land-farm/recreational.........................         -          6,544          488          -
     Residential properties for resale....................       7,399        1,497        2,496          -
     Miscellaneous........................................       2,454       49,991          235          -
                                                             ---------    ---------    ---------   ---------
           Total..........................................    $293,988   $1,144,579      $19,349      $9,062
                                                            ==========   ==========   ==========  ==========
     </TABLE>
     <TABLE>
     Table 11              Loans Secured by Real Estate and Other Real Estate Owned by Geographic Region
     <CAPTION>
                                                                            March 31, 1997
                                                            -------------------------------------------------
                                                                  Total loans
                                                            -----------------------                  Other
                                                           Real estate  Real estate Nonperforming real estate
                                                           construction   mortgage      loans        owned
                                                          ------------- ----------- ------------- -----------
                                                                            (in thousands)
     <S>                                                  <C>          <C>          <C>          <C>
     Maryland.............................................    $239,069     $771,057       $6,685      $4,964
     Pennsylvania.........................................       8,464      152,379        2,204       1,451
     Virginia.............................................      23,345       78,154        9,908       2,147
     Washington, D.C......................................       6,784       47,524          552          -
     Florida..............................................       1,708       26,483          -           500
     New Jersey...........................................       1,267       31,990          -            -
     Delaware.............................................       5,784       14,490          -            -
     All other............................................       7,567       22,502          -            -
                                                             ---------    ---------    ---------   ---------
           Total..........................................    $293,988   $1,144,579      $19,349      $9,062
                                                            ==========   ==========   ==========  ==========
     </TABLE>






     <PAGE>
     PAGE 24


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


     Asset Quality


     Nonperforming Assets

          Nonperforming assets totaled $66.1 million at March 31, 1997,
     an increase of $7.2 million when compared to nonperforming assets of
     $58.9 million at December 31, 1996.  Nonperforming assets increased
     $13.5 million primarily due to the transfer of loans to nonaccrual
     status.  These additions were partially offset by the following:
     paydowns on nonaccrual loans of $3.8 million; other real estate owned
     ("OREO") sales of $2.0 million; loans reclassified to accrual status
     of $389 thousand and charge-offs of $123 thousand.  The nonaccrual
     loan paydowns were cash payments on a variety of commercial and real
     estate loans.  The most significant OREO sale was a $1.2 million
     commercial real estate property which resulted in a gain of $127
     thousand.  Loans returned to accrual status were residential loans
     which met the regulatory tests for return to accrual status.
     Information on the Corporation's impaired loans is included in Note
     4 of the Notes to the Consolidated Financial Statements.

     <TABLE>
          The following table presents nonperforming assets and accruing
     loans which are 90 days past due as to principal or interest on the
     dates indicated.



     Table 12                          Nonperforming Assets
     <CAPTION>

                                                            March 31,   December 31,  March 31,
                                                               1997         1996         1996
                                                          ------------- ------------ -------------
                                                                   (dollars in thousands)
     <S>                                                  <C>          <C>          <C>
     Nonaccrual loans
     Domestic:
       Commercial.........................................     $17,781      $13,988      $16,605
       Real estate, construction..........................       2,912        4,014        1,072
       Real estate mortgage, commercial...................      16,437       16,333        5,019
       Real estate mortgage, residential..................      13,422        7,545        6,964
     Foreign..............................................       3,800        3,800        3,800
                                                              --------     --------     --------
           Total nonaccrual loans.........................      54,352       45,680       33,460
                                                              --------     --------     --------
     Restructured loans...................................         121          126          139
     Other assets owned:
       Other real estate..................................      11,073       12,765       11,832
       Valuation reserves.................................        (324)        (324)        (295)
       Other assets.......................................         922          705          396
                                                              --------     --------     --------
           Total other assets owned.......................      11,671       13,146       11,933
                                                              --------     --------     --------
       Total nonperforming assets.........................     $66,144      $58,952      $45,532
                                                              ========     ========     ========

     Nonperforming assets as a percentage of total
        loans, net of unearned income plus other
        foreclosed assets owned...........................        0.97%        0.87%        0.73%
                                                                  ====         ====         ====

     Accruing loans contractually past due
     90 days or more as to principal or interest:
        Domestic..........................................     $18,266      $23,812      $20,580
                                                              ========     ========     ========
     </TABLE>










     <PAGE>
     PAGE 25


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

     <TABLE>
          The following table details certain information relating to the
     allowance for credit losses of the Corporation for the three months
     ended March 31, 1997 and March 31, 1996, respectively.


     Table 13                 Analysis of the Allowance for Credit Losses
     <CAPTION>


                                                           Three months ended March 31,
                                                          -------------------------------
                                                               1997         1996
                                                            ----------   ----------
                                                             (dollars in thousands)
     <S>                                                  <C>          <C>
     Allowance at beginning of year.......................    $154,802     $177,621
     Provision for credit losses..........................       9,900        4,000
     Losses charged off:
         Commercial loans.................................        (133)        (459)
         Real estate loans, mortgage:
           Residential....................................         -            (14)
           Commercial.....................................        (123)         -
         Retail loans.....................................      (1,447)      (1,174)
         Bankcard loans...................................      (9,518)     (11,227)
         Leases receivable................................        (132)         -
                                                              --------     --------
           Total losses charged off.......................     (11,353)     (12,874)

     Recoveries of losses previously charged off:
         Commercial loans.................................         221          352
         Real estate loans, construction..................          52           10
         Real estate loans, mortgage:
           Residential....................................         -              3
           Commercial.....................................         -              5
         Retail loans.....................................         703          443
         Bankcard loans...................................         454        1,267
         Leases receivable................................          27           26
                                                              --------     --------
           Total recoveries...............................       1,457        2,106
     Net losses charged off...............................      (9,896)     (10,768)
                                                              --------     --------
     Total allowance at March 31..........................    $154,806     $170,853
                                                              ========     ========

     Average loans, net of average unearned income........  $6,792,709   $6,173,601
                                                            ==========   ==========
     Period end loans, net of unearned income.............  $6,782,130   $6,228,882
                                                            ==========   ==========
     Net charge-offs to average loans, net of average
        unearned income (annualized)......................        0.59%        0.70%

     Allowance as a percentage of period end loans, net
        of unearned income................................        2.28         2.74

     Allowance as a percentage of nonperforming loans.....      284.19       508.51
     </TABLE>

          The Corporation's bankcard loan portfolio, like the portfolios of
     most other credit card issuers, is experiencing higher charge-off rates
     as a result of higher-than-anticipated levels of personal bankruptcies
     and the general expansion of unsecured consumer credit.  The
     Corporation's ratio of bankcard loan net charge-offs to average loans,
     net of average unearned income (annualized) for the first quarter of
     1997 increased over the fourth quarter of 1996 and the first quarter
     of 1996 ratios.  The Corporation continues to monitor trends in the
     bankcard loan portfolio and is managing credit line usage and
     underwriting standards in a more aggressive manner.










     <PAGE>
     PAGE 26


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


     Deposits

          Total deposits increased $147.0 million from December 31, 1996 to
     March 31, 1997.  Core deposits increased $94.4 million.  Commercial
     noninterest bearing demand deposits increased $110.7 million.  Money
     market deposits and other savings deposits increased $59.0 million
     partially offset by a $56.2 million decline in other consumer time
     deposits.  Purchased deposits, which include large denomination time
     deposits and foreign time deposits, increased $52.6 million primarily
     due to an increase in large denomination time deposits.

          Total deposits increased $674.0 million from March 31, 1996 to
     March 31, 1997.  Core deposits increased $569.0 million.  The 1st
     Washington acquisition resulted in an increase to the core deposit base
     and the number of branch locations.  A $384.2 million increase in
     commercial noninterest bearing demand deposits represented more than
     65% of the total core deposit increase and resulted from new business
     initiatives.  Purchased deposits increased $105.0 million primarily due
     to an increase in large denomination time deposits.


























































     <PAGE>
     PAGE 27


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


     Capital Resources
     <TABLE>
          The following table details the Corporation's capital components
     and ratios at March 31, 1997, December 31, 1996 and March 31, 1996,
     based upon the capital requirements of the Federal Reserve Board.


     Table 14                       Capital Components
     <CAPTION>
                                                                         March 31,   December 31,  March 31,
                                                                            1997         1996         1996
                                                                       ------------ ------------- -------------
                                                                                 (dollars in thousands)
     <S>                                                               <C>          <C>          <C>
     Preferred stockholders' equity....................................    $144,852     $144,852    $144,852
     Common stockholder's equity.......................................   1,113,880    1,102,645   1,042,739
     Guaranteed preferred beneficial interests in Company's junior
        subordinated debentures........................................     296,344      147,113         -
     Disallowed intangibles............................................     (87,778)     (90,861)    (36,421)
     Net unrealized (gains) losses on investment securities available-
        for-sale (1)...................................................      11,687       (8,332)     (1,533)
                                                                           --------     --------    --------
     Tier 1 capital....................................................   1,478,985    1,295,417   1,149,637
                                                                           --------     --------    --------
     Qualifying long-term debt.........................................      99,776       99,765      99,733
     Intermediate preferred stock......................................       7,748        7,700         -
     Allowance for credit losses (2)...................................     118,123      115,173     106,272
     Mandatory convertible securities..................................      59,980       59,977      59,971
                                                                           --------     --------    --------
     Tier 2 capital....................................................     285,627      282,615     265,976
                                                                           --------     --------    --------
     Total capital.....................................................  $1,764,612   $1,578,032  $1,415,613
                                                                         ==========   ==========  ==========

     Risk-adjusted assets..............................................  $9,413,115   $9,174,168  $8,437,187
                                                                         ==========   ==========  ==========
     Average quarterly assets (regulatory guidelines).................. $10,901,606  $10,725,996 $10,494,467
                                                                         ==========   ==========  ==========
     Risk-based capital ratios:
       Tier 1 to risk adjusted assets..................................       15.71%       14.12%      13.63%
       Regulatory minimum..............................................        4.00         4.00        4.00
       Total capital to risk-adjusted assets...........................       18.75        17.20       16.78
       Regulatory minimum..............................................        8.00         8.00        8.00

     Leverage ratio....................................................       13.68        12.18       10.99

     <FN>
     (1)  Not included as Tier 1 capital under current regulatory capital guidelines.
     (2)  The amount of the allowance for credit losses which is includable as Tier 2 capital is limited
          to 1.25% of the risk-adjusted assets less disallowed intangibles.
     </TABLE>

          Tier 1 capital increased $183.6 million when March 31, 1997 is
     compared to December 31, 1996 and total capital increased $186.6 million
     during this same period.  The Corporation issued an additional $148.3
     million in guaranteed preferred beneficial interests in Company's junior
     subordinated debentures in February 1997 which qualify as Tier 1 capital.
     See Note 10 of the Notes to Consolidated Financial Statements for
     additional information.  In addition, net income of $34.1 million was
     partially offset by $3.1 million in dividends declared on preferred stock
     in the first three months of 1997.

          Tier 1 and total capital increased $329.3 million and $349.0
     million respectively, when March 31, 1997 is compared to March 31, 1996.
     The Corporation issued $295.4 million in guaranteed preferred beneficial
     interests in Company's junior subordinated debentures in December 1996
     and February 1997.  Net income of $136.4 million was partially offset by
     $52.1 million in dividends declared on common stock and preferred stock
     during this period.  In addition, Tier 1 capital was negatively impacted
     by additional disallowed goodwill resulting from the acquisitions of
     1st Washington and Zirkin-Cutler in 1996.  Tier 2 capital was positively
     impacted by the issuance of intermediate preferred stock in 1996.
     Additional information regarding the Corporation's capital is presented
     in the Consolidated Statements of Changes in Stockholders' Equity.



     <PAGE>
     PAGE 28


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


     Off-Balance Sheet Derivative Financial Instruments

     Trading Instruments

          The Corporation maintains active trading positions in a variety
     of financial derivatives including foreign exchange and interest rate
     futures, interest rate swaps, interest rate caps and floors, forward
     rate agreements, and interest rate and foreign exchange options.  Many
     of these positions are the result of activity generated by corporate
     customers.  The balance of the positions represent strategic
     trading decisions of the Corporation's derivative and foreign
     exchange traders.  The managers and traders involved in financial
     derivatives have the technical expertise to trade these products.
     The active involvement of the Corporation's traders in these
     markets allows the Corporation to offer competitive pricing to
     customers and the expertise necessary to advise the Corporation's
     asset/liability managers on the proper timing and execution of
     hedging strategies for the Corporation's balance sheet.

          All trading activity is conducted within the risk limits approved
     by the Corporation's Board of Directors.  Trading systems are in place
     which measure risks and profitability associated with derivative trading
     positions as market movements occur.  An independent risk control unit
     monitors these risks.  The results are reported daily and reviewed by the
     Corporation's Asset/Liability Committee and the Executive Committee of the
     Board of Directors on a monthly basis.

     <TABLE>
          The following table presents the notional amounts and fair values
     of the classes of trading instruments at March 31, 1997 as well as
     the average fair values for the three months ended March 31, 1997.


     Table 15                       Trading Instruments
     <CAPTION>
                                              March 31, 1997
                                  --------------------------------------
                                                     Fair Values
                                             ---------------------------
                                   Notional                   Average
                                   Amounts   End-of-Period  Three Months
                                  ---------- -------------  ------------
                                               (in thousands)
     <S>                        <C>         <C>           <C>
     Interest Rate Contracts

       Interest Rate Swaps.....  $1,132,301
         Receivable position...                   $10,459       $7,941
         Payable position......                    (8,694)      (5,235)

       Interest Rate Caps/Floors  1,279,403
         Held..................                     1,351        2,789
         Written...............                    (1,351)      (2,789)

       Futures.................      16,000
         Favorable position....                       250            -
         Unfavorable position..                      -               -

       Options.................       5,000
         Held..................                        23            -
         Written...............                      -               -


     Foreign Exchange Contracts

       Options.................   2,929,146
         Held..................                    47,233       41,687
         Written...............                   (26,878)     (29,232)

       Forwards................     865,335
         Favorable position....                     8,072        6,775
         Unfavorable position..                   (10,663)      (5,716)

     </TABLE>



     <PAGE>
     PAGE 29

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


     Off-Balance Sheet Derivative Financial Instruments (cont'd)

     Net Trading Income
     <TABLE>
          The following table summarizes the Corporation's net trading income
     by category of instrument.  Net trading income is included in the income
     statement as a component of other noninterest income.


     Table 16                        Net Trading Income
     <CAPTION>
                                                           Three months ended March 31,
                                                          -------------------------------
                                                                1997         1996
                                                             ---------    ---------
                                                                 (in thousands)
     <S>                                                  <C>          <C>
              Interest rate contracts:
                  Interest rate swaps.....................       ($744)     ($1,929)
                  Futures.................................         630        1,554
                  Interest rate caps and floors...........           -            -
                  Options.................................           1            -
                  Miscellaneous...........................          31          192
                                                               -------      -------
                                                                   (82)        (183)
                                                               -------      -------
              Foreign exchange contracts:
                  Spot and forward contracts..............     (25,222)      (1,740)
                  Futures.................................           -            2
                  Options.................................      25,541        1,947
                  Miscellaneous...........................         645          521
                                                               -------      -------
                                                                   964          730
                                                               -------      -------
              Other:
                  Securities..............................         701          604
                                                               -------      -------
                        Total net trading income..........      $1,583       $1,151
                                                               =======      =======
     </TABLE>







































     <PAGE>
     PAGE 30

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


     Off-Balance Sheet Derivative Financial Instruments (cont'd)


     Risk Management Instruments

          Derivative financial instruments are an integral part of the
     Corporation's risk management process.  Derivatives allow the
     Corporation to modify the repricing or maturity characteristics of
     assets and liabilities in a cost-efficient manner.  This flexibility
     helps the Corporation to achieve liquidity, capital, and interest rate
     risk objectives.

          Derivatives fluctuate in value as interest rates rise or fall, just
     as on-balance sheet assets and liabilities fluctuate in value.
     Derivatives are used to modify the characteristics of assets or liabilities
     to which they are designated as well as to provide basis risk protection.

          For example, the Corporation utilizes interest rate swaps to convert
     fixed rate assets to floating rate assets or vice versa.  When the
     Corporation uses swaps to match/fund fixed rate term loans to customers,
     the Corporation is converting the fixed rate loans to floating rate loans
     that better match the floating rate deposits received from core customers.

          Interest rate swaps also are used to convert floating rate liabilities
     to fixed rate liabilities or vice versa.  Interest rate swaps designated
     to certain liabilities are used to extend the period over which the
     Corporation's short-term deposits reprice, thus locking in fixed rates.
     This offers protection against liabilities repricing faster than assets
     during periods of rising interest rates.  Interest rate swaps sold as
     liability hedges are used to adjust fixed rate long-term deposits to
     floating rate deposits.  The Corporation receives a fixed rate on this
     type of swap that offsets the fixed rate paid on the term deposits thus
     converting the deposits to a floating rate.  By issuing long-term deposits,
     the Corporation increases its overall liquidity.  Customer demand for
     long-term deposits is primarily fixed rate.  Interest rate swaps allow the
     Corporation to swap fixed rate liabilities for floating rate liabilities
     when appropriate for interest rate sensitivity purposes.

          The Corporation also utilizes interest rate swaps to extend the
     period over which floating rate assets (e.g. prime rate loans) reprice
     thus locking in a fixed rate.  This strategy is used to reduce the asset
     sensitivity of the balance sheet or to better match maturities of assets
     or liabilities.  Basis swaps are sometimes utilized to protect the interest
     rate spread between assets and liabilities that are repriced based on
     different indexes.  Prime rate loans are often funded by liabilities that
     reset off of a CD index, treasury index, or LIBOR.  Basis swaps lock in
     the spread between different indexes during the life of the swaps.  These
     swaps transfer the basis risk to third parties willing to assume the risk
     and allow the Corporation to lock in interest rate spreads between certain
     assets and liabilities.



























     <PAGE>
     PAGE 31

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

     Off-Balance Sheet Derivative Financial Instruments (cont'd)
     <TABLE>
          The following table presents the notional amounts and fair values for
     the risk management instruments entered into by the Corporation at
     March 31, 1997 as well as the weighted average maturity and weighted
     average receive and pay rates for the instruments at March 31, 1997.


     Table 17                          Risk Management Instruments
     <CAPTION>
                                                                       March 31, 1997
                                            -----------------------------------------------------------------

                                                             Weighted
                                                              Average     Weighted Average Rate    Estimated
                                              Notional       Maturity     ---------------------      Fair
                                               Amount        in Years     Receive        Pay         Value
                                              --------     ------------ -----------  -----------   ---------
                                                                           (dollars in thousands)
     <S>                                    <C>           <C>          <C>          <C>          <C>
     Designated to Assets
     --------------------

     Interest rate swaps sold
     ------------------------
     Convert floating rate to fixed
          rate.....................              $767,500         3.54         6.23%        5.48%   ($11,463)
                                                                                                     --------
       Carrying amount (1).........                                                                    3,674
       Unrealized gross gains......                                                                        -
       Unrealized gross losses.....                                                                  (15,137)

     Interest rate swaps purchased
     -----------------------------
     Convert fixed rate to floating
          rate.....................                46,349         3.24         5.56         6.29         179
                                                                                                     --------
       Carrying amount (1).........                                                                      (68)
       Unrealized gross gains......                                                                      458
       Unrealized gross losses.....                                                                     (211)

     Designated to Liabilities
     -------------------------

     Interest rate swaps sold
     ------------------------
     Convert fixed rate to floating
          rate.....................               262,000         1.03         6.37         5.56       1,117
                                                                                                     --------
       Carrying amount (1).........                                                                      623
       Unrealized gross gains......                                                                      980
       Unrealized gross losses.....                                                                     (486)

     Interest rate swaps purchased
     -----------------------------
     Convert floating rate to fixed
          rate.....................                     -            -            -            -           -
                                                                                                     --------
       Carrying amount (1).........                                                                     (131)
       Unrealized gross gains......                                                                      131
       Unrealized gross losses.....                                                                        -

     Interest rate caps purchased
     ----------------------------
     Cap floating rate at strike
          level....................               159,100         2.21          Cap - 13.50% (2)           -
                                                                                                     --------
       Carrying amount (1).........                                                                        -
       Unrealized gross gains......                                                                        -
       Unrealized gross losses.....                                                                        -

     Call options purchased........                 9,563         0.60            -            -       2,947
     ----------------------                                                                          --------
       Carrying amount (1).........                                                                    3,113
       Unrealized gross gains......                                                                        -
       Unrealized gross losses.....                                                                     (166)

     </TABLE>

     <PAGE>
     PAGE 32

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


     Off-Balance Sheet Derivative Financial Instruments (cont'd)

     <TABLE>
     Table 17                          Risk Management Instruments
     <CAPTION>
                                                                       March 31, 1997
                                            -----------------------------------------------------------------

                                                             Weighted
                                                              Average     Weighted Average Rate    Estimated
                                              Notional       Maturity     ---------------------      Fair
                                               Amount        in Years     Receive        Pay         Value
                                              --------     ------------ -----------  -----------   ---------
                                                                           (dollars in thousands)
     <S>                                    <C>           <C>          <C>          <C>          <C>
     Basis swaps
     -----------
     Convert floating rate to
          different index..........               $80,000         1.39         5.67%        5.45%      ($450)
                                                                                                     --------
       Carrying amount (1).........                                                                       14
       Unrealized gross gains......                                                                       69
       Unrealized gross losses.....                                                                     (533)

     <FN>
     (1)  Carrying amounts for 1997 represent accrued interest receivable (payable) and the following deferred fees: deferred
          losses on the early termination of interest rate swaps sold, $3.4 million; deferred gain on the early termination of
          an interest rate swap purchased, ($131) thousand; and deferred premiums on call options purchased, $166 thousand.
     (2)  Pays interest if interest rates exceed 13.50%.
     </TABLE>
     <TABLE>
          The following table summarizes the estimated maturities of the risk
     management instruments entered into by the Corporation at March 31, 1997.


     Table 18           Maturity Schedule of Risk Management Instruments

     <CAPTION>
                                                1 Year         1-5
                                               or Less        Years        Total
                                             ------------  ------------ -----------
                                                     (dollars in thousands)
     <S>                                    <C>           <C>          <C>
     Designated to Assets
     --------------------
        Notional amount.....................    $   -         $813,849     $813,849
        Weighted average receive rate.......        -  %          6.19%        6.19%
        Estimated fair value................        -          (11,284)     (11,284)


     Designated to Liabilities
     -------------------------
        Notional amount.....................     $144,953     $285,710     $430,663
        Weighted average receive rate.......         6.14%        6.63%        6.37%
        Estimated fair value................        2,267        1,797        4,064


     Basis Swaps
     -----------
        Notional amount.....................    $   -          $80,000      $80,000
        Weighted average receive rate.......        -  %          5.67%        5.67%
        Estimated fair value................        -             (450)        (450)
     </TABLE>















     <PAGE>
     PAGE 33

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


     Off-Balance Sheet Derivative Financial Instruments (cont'd)

     <TABLE>
          The following table summarizes the activity of the risk management
     instruments entered into by the Corporation, by notional amounts, for
     the three months ended March 31, 1997.

     Table 19             Activity of Risk Management Instruments
     <CAPTION>
                                                            Designated
                                               Designated       to          Basis
                                                to Assets   Liabilities     Swaps        Total
                                               ----------  ------------   --------       -----
                                                               (in thousands)
     <S>                                    <C>           <C>          <C>          <C>
     Three months ended March 31, 1997
     ---------------------------------
     Balance at beginning of year...........     $763,923     $514,536      $80,000   $1,358,459
     Additions..............................       50,000       15,000         -          65,000
     Maturities/amortizations...............          (74)     (98,873)        -         (98,947)
                                                 --------     --------     --------   ----------
     Balance at March 31, 1997..............     $813,849     $430,663      $80,000   $1,324,512
                                                 ========     ========     ========   ==========
     </TABLE>


          Deferred losses on the early termination of interest rate swaps with
     notional balances of $200.0 million designated to the Corporation's prime
     based commercial loans were $3.4 million as of March 31, 1997.  In the
     remainder of 1997 and 1998, $2.6 million and $858 thousand, respectively,
     will be amortized into income.

          The deferred gain on the early termination of an interest rate swap
     with a notional balance of $100.0 million designated to the Corporation's
     federal funds purchased was $131 thousand as of March 31, 1997.  In the
     remainder of 1997 and 1998, $74 thousand and $57 thousand, respectively,
     will be amortized into income.

          For the three months ended March 31, 1997, the off-balance sheet
     derivative financial instruments entered into for risk management
     purposes by the Corporation had the following impact on the components
     of net interest income: gross interest income decreased $793 thousand
     and gross interest expense decreased $1.1 million which resulted in
     a $334 thousand increase in net interest income.


































     <PAGE>
     PAGE 34


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


     Pending Transactions


          On January 21, 1997, the Corporation, AIB and Dauphin Deposit
     Corporation ("Dauphin") entered into a definitive agreement and plan of
     merger, pursuant to which Dauphin will merge into and with the
     Corporation.  Dauphin shareholders will receive cash and AIB American
     Depository Shares ("AIB ADSs") with an aggregate value of approximately
     $1.36 billion based upon the market price of AIB ADSs on January 21,
     1997.  Dauphin and its bank and nonbank subsidiaries provide corporate,
     commercial, correspondent and retail banking services, personal and
     corporate trust services and related financial products and services to
     individuals, businesses, governmental units and financial institutions,
     primarily in south-central Pennsylvania.  At March 31, 1997, Dauphin
     had consolidated total assets of $5.8 billion, total deposits of $4.1
     billion, and total stockholders' equity of $573.4 million.  The purchase
     of Dauphin is subject to both Dauphin and AIB shareholder approval as
     well as U.S. and Irish regulatory approvals.

          The Corporation, on a parent company basis, held liquid assets in
     excess of short-term liabilities totaling approximately $515 million
     at March 31, 1997.  It is the intention of management to use these assets
     as a source of funding for the acquisition of Dauphin.  As a result,
     dividends from subsidiaries will be the primary source of funds for debt
     service and preferred stock dividend requirements of the Corporation
     subsequent to the acquisition.  Management is confident that the earnings
     and dividend capacity at its subsidiary banks will be adequate to service
     interest obligations on existing and new long-term debt and any preferred
     stock dividend requirements of the Corporation.
















































     <PAGE>
     PAGE 35


                            Part II - Other Information

     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

           A current report on Form 8-K was filed on January 29, 1997 to
           report the January 21, 1997 announcement of a merger agreement
           between First Maryland Bancorp, Allied Irish Banks, p.l.c. and
           Dauphin Deposit Corporation.

           A current report on Form 8-K was filed on February 3, 1997 to
           file Dauphin Deposit Corporation consolidated financial statements
           as of and for the year ended December 31, 1995; notes to
           consolidated financial statements; and independent auditor's report
           on the consolidated financial statements and Dauphin Deposit
           Corporation unaudited consolidated financial statements as of and
           for the three and nine months ended September 30, 1996.

           A current report on Form 8-K was filed on March 5, 1997 to file
           certain unaudited pro forma consolidated, condensed financial
           statements to reflect the merger of Dauphin Deposit Corporation
           into First Maryland Bancorp on a purchase accounting basis.



                              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.





                                        First Maryland Bancorp



     May 14, 1997                        BY /s/ Jerome W. Evans
                                         ----------------------------
                                         Jerome W. Evans
                                         Executive Vice President and
                                           Chief Financial Officer


     May 14, 1997                        BY /s/ Robert L. Carpenter, Jr.
                                         -------------------------------
                                         Robert L. Carpenter, Jr.
                                         Senior Vice President and
                                           Controller