SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

For the Quarter Ended June 30, 1999                Commission File Number 1-4629


                        GOLDEN WEST FINANCIAL CORPORATION
--------------------------------------------------------------------------------


          Delaware                                      95-2080059
----------------------------------------   -------------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)

1901 Harrison Street, Oakland, California                            94612
-----------------------------------------                        ---------------
(Address of principal executive offices)                           (Zip Code)

Registrant's telephone number, including area code:             (510) 446-3420
                                                              ------------------


     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
     -----------     -----------

         The number of shares  outstanding of the  registrant's  common stock on
July 31, 1999, was 55,003,154 shares.


<PAGE>


PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

         The  consolidated   financial   statements  of  Golden  West  Financial
Corporation  and  subsidiaries  (Golden  West or Company)  for the three and six
months  ended  June  30,  1999 and 1998 are  unaudited.  In the  opinion  of the
Company, all adjustments (consisting only of normal recurring accruals) that are
necessary  for a fair  statement  of the  results  for such  three and six month
periods have been included.  The operating  results for the three and six months
ended June 30, 1999, are not necessarily  indicative of the results for the full
year.


                        Golden West Financial Corporation
                  Consolidated Statement of Financial Condition
                             (Dollars in thousands)
<TABLE>
<CAPTION>


                                                                          June 30       June 30      December 31
                                                                           1999           1998           1998
                                                                        ------------  -------------  -------------
                                                                               (Unaudited)
                                                                        ---------------------------

Assets:
<S>                                                                      <C>            <C>            <C>
  Cash                                                                   $  240,911     $  198,513     $  250,875
  Securities available for sale at fair value                               380,541        416,441        377,005
  Other investments at cost                                                 316,880        144,000        422,385
  Purchased mortgage-backed securities available for sale
    at fair value                                                            92,879        136,289        113,585
  Purchased mortgage-backed securities held to maturity
    at cost                                                                 476,598        678,434        572,376
  Mortgage-backed securities held to maturity with recourse at cost       3,287,113      4,523,653      3,884,347
  Mortgage-backed securities-REMICs held to maturity at cost              8,146,373      3,782,403      5,461,657
  Loans receivable                                                       23,485,887     27,600,120     25,721,288
  Interest earned but uncollected                                           175,806        209,687        209,328
  Investment in capital stock of Federal Home Loan Banks--at cost
      which approximates fair value                                         534,443        708,382        780,303
  Real estate held for sale or investment                                    24,294         44,065         45,696
  Prepaid expenses and other assets                                         591,034        363,406        357,363
  Premises and equipment--at cost less accumulated depreciation             274,214        261,836        272,521
                                                                        ------------  -------------  -------------
                                                                        $38,026,973    $39,067,229    $38,468,729
                                                                        ============  =============  =============

Liabilities and Stockholders' Equity:
  Deposits                                                              $26,335,706    $24,993,708    $26,219,095
  Advances from Federal Home Loan Banks                                   6,111,398      7,486,916      6,163,472
  Securities sold under agreements to repurchase                            684,938      1,816,433      1,252,469
  Accounts payable and accrued expenses                                     582,482        521,828        468,213
  Taxes on income                                                           333,282        313,634        329,409
  Subordinated notes--net of discount                                       812,438      1,011,159        911,753
  Stockholders' equity                                                    3,166,729      2,923,551      3,124,318
                                                                        ------------  -------------  -------------
                                                                        $38,026,973    $39,067,229    $38,468,729
                                                                        ============  =============  =============
</TABLE>


<PAGE>


                        Golden West Financial Corporation
                     Consolidated Statement of Net Earnings
                                   (Unaudited)
                 (Dollars in thousands except per share figures)
<TABLE>
<CAPTION>

                                                         Three Months Ended               Six Months Ended
                                                              June 30                         June 30
                                                    ----------------------------    ----------------------------
                                                        1999           1998            1999            1998
                                                    -------------   ------------    ------------    ------------
  Interest Income:
<S>                                                   <C>            <C>             <C>            <C>
      Interest on loans                               $  445,358     $  587,188      $  921,602     $ 1,216,066
      Interest on mortgage-backed securities             189,363        105,536         358,114         177,731
      Interest and dividends on investments               50,577         47,845         100,543         101,975
                                                    -------------   ------------    ------------    ------------
                                                         685,298        740,569       1,380,259       1,495,772
  Interest Expense:
      Interest on deposits                               306,067        321,079         613,634         636,289
      Interest on advances                                82,429        105,206         169,180         228,766
      Interest on repurchase agreements                   18,743         33,097          32,290          66,033
      Interest on other borrowings                        29,553         41,990          65,948          81,773
                                                    -------------   ------------    ------------    ------------
                                                         436,792        501,372         881,052       1,012,861
                                                    -------------   ------------    ------------    ------------
          Net Interest Income                            248,506        239,197         499,207         482,911
  Provision for (recovery of) loan losses                   (727)         2,682            (153)          5,647
                                                    -------------   ------------    ------------    ------------
          Net Interest Income after Provision
              for (Recovery of) Loan Losses              249,233        236,515         499,360         477,264
  Non-Interest Income:
      Fees                                                16,762         15,716          32,921          28,663
      Gain on the sale of securities, MBS, and loans       8,249         19,077          18,312          21,584
      Other                                               17,537          8,304          26,614          18,853
                                                    -------------   ------------    ------------    ------------
                                                          42,548         43,097          77,847          69,100
  Non-Interest Expense:
      General and administrative:
          Personnel                                       52,418         48,044         104,216          94,580
          Occupancy                                       16,417         14,949          32,704          29,118
          Deposit insurance                                1,345          1,516           2,738           3,128
          Advertising                                      3,029          3,218           5,208           5,464
          Other                                           22,817         19,309          44,206          38,420
                                                    -------------   ------------    ------------    ------------
                                                          96,026         87,036         189,072         170,710
  Earnings before Taxes on Income and
      Extraordinary Item                                 195,755        192,576         388,135         375,654
      Taxes on Income                                     73,368         75,626         145,380         148,623
                                                    -------------   ------------    ------------    ------------
  Earnings before Extraordinary Item                     122,387        116,950         242,755         227,031
  Extraordinary Item:
  Federal Home Loan Bank advance prepayment
      penalty, net of tax benefit                            -0-            -0-             -0-          (7,710)
                                                    ------------    ------------    ------------    ------------
  Net Earnings                                        $  122,387     $  116,950      $  242,755      $  219,321
                                                    =============   ============    ============    ============

  Basic earnings per share before extraordinary item  $     2.19     $     2.04      $     4.32      $     3.96
  Basic earnings per share on extraordinary
      item, net of tax benefit                              0.00           0.00            0.00            (.13)
                                                    -------------   ------------    ------------    ------------
  Basic earnings per share                            $     2.19     $     2.04      $     4.32      $     3.83
                                                    =============   ============    ============    ============

  Diluted earnings per share before extraordinary     $     2.17     $     2.01      $     4.28      $     3.91
      item
  Diluted earnings per share on extraordinary item,
      net of tax benefit                                    0.00           0.00            0.00            (.13)
                                                    -------------   ------------    ------------    ------------
  Diluted earnings per share                          $     2.17     $     2.01      $     4.28      $     3.78
                                                    =============   ============    ============    ============
</TABLE>



<PAGE>


                        Golden West Financial Corporation
                      Consolidated Statement of Cash Flows
                                   (Unaudited)
                             (Dollars in thousands)

<TABLE>
<CAPTION>

                                                            Three Months Ended               Six Months Ended
                                                                  June 30                         June 30
                                                        ----------------------------    ----------------------------
                                                           1999            1998            1999            1998
                                                        ------------    ------------    ------------   -------------
Cash Flows from Operating Activities:
<S>                                                      <C>             <C>             <C>             <C>
  Net earnings                                           $  122,387      $  116,950      $  242,755      $  219,321
  Adjustments to reconcile net earnings to net cash
  provided by operating activities:
    Extraordinary item                                          -0-             -0-             -0-          13,035
    Provision for (recovery of) loan losses                    (727)          2,682            (153)          5,647
    Amortization of loan fees and discounts                  (4,325)         (5,989)        (10,519)        (11,094)
    Depreciation and amortization                             7,029           5,967          13,966          11,691
    Loans originated for sale                              (316,881)       (212,419)       (603,945)       (333,958)
    Sales of loans                                          425,419         268,226         960,763         400,166
    Decrease  in interest earned but uncollected             10,955           3,903          33,522           7,236
    Federal Home Loan Bank stock dividends                   (7,985)        (10,332)        (28,952)        (27,715)
    Increase in prepaid expenses and other assets          (121,119)        (15,228)       (227,363)       (106,832)
    Increase in accounts payable and accrued expenses        35,279          15,648         102,134          74,472
    Increase (decrease) in taxes on income                  (38,213)        (20,707)         24,427          43,231
    Other, net                                               (1,330)         (1,445)         (2,579)         (5,872)
                                                        ------------    ------------    ------------   -------------
      Net cash provided by operating activities             110,489         147,256         504,056         289,328

Cash Flows from Investing Activities:
  New loan activity:
    New real estate loans originated for portfolio       (2,553,140)     (1,859,213)      (4,344,056)     (3,204,867)
    Real estate loans purchased                                (475)           (642)            (935)         (1,689)
    Other, net                                              (26,553)         (9,554)         (37,134)        (20,371)
                                                        ------------    ------------    ------------   -------------
                                                         (2,580,168)     (1,869,409)      (4,382,125)     (3,226,927)
  Real estate loan principal payments:
    Monthly payments                                        143,282         159,588          295,212         334,507
    Payoffs, net of foreclosures                          1,258,866       1,555,523        2,427,824       2,732,892
                                                        ------------    ------------    ------------   -------------
                                                          1,402,148       1,715,111        2,723,036       3,067,399

  Repayments of mortgage-backed securities                  795,041         367,349        1,545,868         515,869
  Proceeds from sales of real estate                         27,396          35,131           67,803          86,536
  Purchases of securities available for sale             (1,315,052)       (127,459)      (1,465,066)       (127,481)
  Sales of securities available for sale                         10          81,150               19          81,373
  Matured securities available for sale                   1,271,205         243,629        1,425,413         253,671
  Decrease in other investments                             838,116         245,044          105,505         108,648
  Purchases of Federal Home Loan Bank stock                     -0-         (99,004)             -0-         (99,994)
  Redemption of Federal Home Loan Bank stock                266,815             -0-          266,815             -0-
  Additions to premises and equipment                        (9,047)        (20,234)         (17,444)        (35,297)
                                                        ------------    ------------    ------------   -------------
    Net cash provided by investing activities               696,464         571,308          269,824         623,797

</TABLE>


<PAGE>


                        Golden West Financial Corporation
                Consolidated Statement of Cash Flows (Continued)
                                   (Unaudited)
                             (Dollars in thousands)
<TABLE>
<CAPTION>


                                                              Three Months Ended               Six Months Ended
                                                                    June 30                         June 30
                                                                                          ----------------------------
                                                          -------------   ------------
                                                              1999           1998            1999            1998
                                                          -------------   ------------    ------------    ------------
   Cash Flows from Financing Activities:
       Deposit activity:
<S>                                                         <C>           <C>             <C>            <C>
       Increase (decrease) in deposits, net                 $ (324,317)   $   171,678     $  (393,517)   $    375,813
       Interest credited                                       264,583        262,760         510,128         508,178
                                                          -------------   ------------    ------------    ------------
                                                               (59,734)       434,438         116,611         883,991

     Additions to Federal Home Loan Bank advances                4,430      2,553,300       1,513,080       3,264,500
     Repayments of Federal Home Loan Bank advances              (7,579)    (2,718,566)     (1,565,152)     (4,306,273)
     Proceeds from agreements to repurchase securities       4,000,156      1,808,100       4,000,251       3,063,990
     Repayments of agreements to repurchase securities      (4,007,842)    (2,176,658)     (4,567,782)     (3,581,605)
     Repayments of medium-term notes                               -0-            -0-             -0-        (110,000)
     Decrease in federal funds purchased                      (475,000)      (500,000)            -0-             -0-
     Repayment of subordinated debt                           (100,000)      (100,000)       (100,000)       (100,000)
     Dividends on common stock                                  (7,833)        (7,163)        (15,754)        (14,303)
     Exercise of stock options                                   2,487          8,585           4,554          12,847
     Purchase and retirement of Company stock                 (112,101)           -0-        (169,652)            -0-
                                                          -------------   ------------    ------------    ------------
       Net cash used in financing activities                  (763,016)      (697,964)       (783,844)       (886,853)
                                                          -------------   ------------    ------------    ------------
   Net Increase (Decrease) in Cash                              43,937         20,600          (9,964)         26,272
   Cash at beginning of period                                 196,974        177,913         250,875         172,241
                                                          -------------   ------------    ------------    ------------
   Cash at end of period                                    $  240,911     $  198,513      $  240,911     $   198,513
                                                          =============   ============    ============    ============

   Supplemental cash flow information:
     Cash paid for:
       Interest                                             $  443,133     $  507,214      $  878,526     $ 1,014,588
       Income taxes                                            111,618        100,251         121,104         104,082
     Cash received for interest and dividends                  696,253        744,472       1,413,781       1,503,008
     Noncash investing activities:
       Loans converted from adjustable rate to
           fixed-rate                                          299,956         35,015         471,326          43,389
       Loans transferred to foreclosed real estate              18,496         27,492          38,568          59,053
       Loans securitized into MBS and MBS-REMICs             3,700,579      5,197,466       3,700,579       5,698,458
</TABLE>


<PAGE>


                        Golden West Financial Corporation
                 Consolidated Statement of Stockholders' Equity
                                   (Unaudited)
                             (Dollars in thousands)
<TABLE>
<CAPTION>

                                                       For the Six Months Ended June 30, 1999
                                 ------------------------------------------------------------------------------------
                                                                         Accumulated
                                                                        Comprehensive
                                                                         Income From
                                             Additional                  Unrealized        Total
                                  Common      Paid-in      Retained       Gains On      Stockholders'  Comprehensive
                                   Stock      Capital      Earnings      Securities        Equity         Income
                                 ----------  -----------   ----------   --------------  -------------  --------------

<S>                                <C>        <C>          <C>            <C>            <C>
Balance at January 1, 1999         $ 5,686    $ 122,159    $2,781,925     $   214,548    $ 3,124,318
Comprehensive income:
  Net earnings                         -0-          -0-       242,755             -0-        242,755     $   242,755
  Change in unrealized gains on
    securities available for sale,
    net of tax                         -0-          -0-           -0-         (18,742)       (18,742)        (18,742)
  Reclassification adjustment
    for gains included in income       -0-          -0-           -0-            (750)          (750)           (750)
                                                                                                       --------------
    Comprehensive Income                                                                                 $   223,263
                                                                                                       ==============
Cash dividends on common
  stock ($.28 per share)               -0-          -0-       (15,754)            -0-        (15,754)
Common stock issued upon
  exercise of stock options,
  including tax benefits                17        4,537           -0-             -0-          4,554
Purchase and retirement of
  Company stock                       (178)         -0-      (169,474)            -0-       (169,652)
                                 ----------  -----------   ----------   --------------  -------------
Balance at June 30, 1999           $ 5,525    $ 126,696    $2,839,452     $   195,056    $ 3,166,729
                                 ==========  ===========   ==========   ==============  =============
</TABLE>
<TABLE>
<CAPTION>

                                                       For the Six Months Ended June 30, 1998
                                 ------------------------------------------------------------------------------------
                                                                         Accumulated
                                                                        Comprehensive
                                                                         Income From
                                             Additional                  Unrealized        Total
                                  Common      Paid-in      Retained       Gains On      Stockholders'  Comprehensive
                                   Stock      Capital      Earnings      Securities        Equity         Income
                                 ----------  -----------   ----------   --------------  -------------  --------------
<S>                                <C>         <C>         <C>            <C>            <C>
Balance at January 1, 1998         $ 5,707     $ 85,532    $2,457,055     $   149,737    $ 2,698,031
Comprehensive income:
  Net earnings                         -0-          -0-      219,321              -0-        219,321     $   219,321
  Change in unrealized gains on
    securities available for sale,
    net of tax                         -0-          -0-          -0-           15,677         15,677          15,677
  Reclassification adjustment
    for gains included in income       -0-          -0-          -0-           (8,022)        (8,022)         (8,022)
                                                                                                       --------------
    Comprehensive Income                                                                                 $   226,976
                                                                                                       ==============
Cash dividends on common
  stock ($.25 per share)               -0-          -0-      (14,303)             -0-        (14,303)
Common stock issued upon
  exercise of stock options,
  including tax benefits                52       12,795          -0-              -0-         12,847
                                 ----------  -----------   ----------   --------------  -------------
Balance at June 30, 1998           $ 5,759     $ 98,327    $2,662,073     $   157,392    $ 2,923,551
                                 ==========  ===========   ==========   ==============  =============
</TABLE>


<PAGE>


ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

         The  discussion  and analysis  included  herein  covers those  material
  changes in liquidity and capital  resources  that have occurred since December
  31, 1998, as well as certain material changes in results of operations  during
  the three and six month periods ended June 30, 1999, and 1998, respectively.

         The following  narrative is written with the presumption that the users
  have read or have access to the  Company's  1998  Annual  Report on Form 10-K,
  which  contains the latest  audited  financial  statements  and notes thereto,
  together with Management's  Discussion and Analysis of Financial Condition and
  Results of  Operations  as of December 31, 1998,  and for the year then ended.
  Therefore,  only  material  changes  in  financial  condition  and  results of
  operations are discussed herein.

         This report contains certain forward-looking statements,  which are not
  historical facts and pertain to future operating results of the Company.  Such
  statements are  forward-looking  statements  within the meaning of the Private
  Securities Litigation Reform Act of 1995. These forward looking statements are
  inherently  subject  to  significant  business,   economic,   and  competitive
  uncertainties  and  contingencies,  many of which  are  beyond  the  Company's
  control. In addition, these forward-looking  statements are subject to change.
  Actual  results  may differ  materially  from the results  discussed  in these
  forward-looking  statements for the reasons, among others, discussed under the
  heading  "Asset/Liability  Management"  in  the  Management's  Discussion  and
  Analysis of Financial  Condition  and Results of  Operations  in the Company's
  1998 Annual Report on Form 10-K.

         NEW ACCOUNTING PRONOUNCEMENTS

         In  1998,  Golden  West  adopted  Statement  of  Financial   Accounting
Standards No. 131,  "Disclosures  about  Segments of an  Enterprise  and Related
Information"   (SFAS  131),  which  establishes  annual  and  interim  reporting
standards for an enterprise's  operating segments and related  disclosures about
its products,  services,  geographic  areas,  and major  customers.  The Company
operates  as a single  segment  and,  therefore,  SFAS 131 had no  effect on the
Company's financial statements.

         In June 1998, the Financial Accounting Standards Board issued Statement
of  Financial   Accounting   Standards  No.  133,   "Accounting  for  Derivative
Instruments  and Hedging  Activities"  (SFAS 133).  This  Statement  establishes
accounting and reporting  standards for derivative  instruments  and for hedging
activities.  It requires that an entity recognize all derivative  instruments as
either assets or liabilities in the statement of financial  position and measure
those  instruments  at fair value.  In June 1999,  the FASB issued  Statement of
Financial Accounting  Standards No. 137, "Accounting for Derivative  Instruments
and Hedging Activities-Deferral of the Effective Date of FASB Statement No. 133"
(SFAS 137) which  delayed  the  effective  date of SFAS 133 until  fiscal  years
beginning  after June 15, 2000.  The Company is in the process of assessing  the
impact of this statement on its financial statements and results of operations.
<PAGE>

                        Golden West Financial Corporation
                              Financial Highlights
                                   (Unaudited)
                 (Dollars in thousands except per share figures)
<TABLE>

                                                         June 30          June 30         December 31
                                                           1999            1998              1998
                                                       -------------    ------------     --------------
<S>                                                    <C>              <C>               <C>
 Assets                                                $ 38,026,973     $39,067,229       $ 38,468,729
 Loans receivable including mortgage-backed securities   35,488,850      36,720,899         35,753,253
 Deposits                                                26,335,706      24,993,708         26,219,095
 Stockholders' equity                                     3,166,729       2,923,551          3,124,318
 Stockholders' equity/total assets                            8.33%           7.48%              8.12%
 Book value per common share                           $      57.31     $     50.76       $      54.95
 Common shares outstanding                               55,252,599      57,590,999         56,861,124
 Diluted common shares outstanding                       55,802,439      58,368,822         57,429,914
 Yield on loan portfolio                                      7.06%           7.51%              7.36%
 Yield on mortgage-backed securities                          7.07%           7.23%              7.20%
 Yield on investments                                         6.45%           6.89%              5.53%
 Yield on earning assets                                      7.06%           7.44%              7.30%
 Cost of deposits                                             4.50%           4.99%              4.67%
 Cost of borrowings                                           5.59%           6.02%              5.87%
 Cost of funds                                                4.75%           5.29%              4.96%
 Yield on earning assets less cost of funds                   2.31%           2.15%              2.34%
 Ratio of nonperforming assets to total assets                 .69%            .89%               .79%
 Ratio of troubled debt restructured to total assets           .04%            .08%               .06%
 World Savings Bank, a Federal Savings Bank:
   Total assets                                        $ 33,277,749     $28,789,260       $ 31,912,264
   Net worth                                              2,337,301       1,931,153          2,164,854
   Net worth/total assets                                     7.02%           6.71%              6.78%
   Regulatory capital ratios:
     Core capital                                             7.01%           6.69%              6.77%
     Risk-based capital                                      12.95%          12.91%             12.93%
 World Savings and Loan Association:
   Total assets                                        $  6,010,867     $10,103,271       $  6,810,266
   Net worth                                                743,145       1,049,734            687,778
   Net worth/total assets                                    12.36%          10.39%             10.10%
   Regulatory capital ratios:
     Core capital                                             9.52%           9.00%              7.25%
     Risk-based capital                                      18.60%          17.78%             16.24%
 World Savings Bank, a State Savings Bank:
   Total assets                                        $  3,536,112     $ 2,355,375       $  3,519,046
   Net worth                                                194,087         123,638            186,411
   Net worth/total assets                                     5.49%           5.25%              5.30%
   Regulatory capital ratios:
     Tier 1 leverage capital                                  5.41%          11.38%              5.26%
     Total risk-based capital                                26.21%          24.12%             25.15%
</TABLE>



<PAGE>


                        Golden West Financial Corporation
                              Financial Highlights
                                   (Unaudited)
                 (Dollars in thousands except per share figures)
<TABLE>
<CAPTION>

                                                         Three Months Ended           Six Months Ended
                                                              June 30                      June 30
                                                      -------------------------   --------------------------
                                                         1999          1998          1999           1998
                                                      -----------   -----------   ------------   -----------
<S>                                                   <C>           <C>            <C>           <C>
  New real estate loans originated                    $2,870,021    $2,071,632     $4,948,001    $3,538,825
  Average yield on new real estate loans                   7.55%         7.76%          7.57%         7.76%
  Current average rate on new real estate loans (a)        6.06%         6.13%          6.09%         6.24%
  Increase (decrease) in deposits (b)(c)              $  (59,734)   $  434,438     $  116,611    $  883,991
  Earnings before extraordinary item                     122,387       116,950        242,755       227,031
  Net earnings                                           122,387       116,950        242,755       219,321
  Basic earnings per share before extraordinary item        2.19          2.04           4.32          3.96
  Diluted earnings per share before extraordinary           2.17          2.01           4.28          3.91
  item
  Basic earnings per share                                  2.19          2.04           4.32          3.83
  Diluted earnings per share                                2.17          2.01           4.28          3.78
  Cash dividends on common stock                             .14          .125            .28           .25
  Average common shares outstanding                   55,888,459    57,338,227     56,232,804    57,233,046
  Average diluted common shares outstanding           56,432,405    58,110,247     56,767,835    57,969,377
  Ratios:(d)
    Net earnings/average net worth (ROE)(e)               15.42%        16.31%         15.37%        15.58%
    Net earnings/average assets (ROA)(e)                   1.28%         1.19%          1.27%         1.11%
    Net interest income/average assets                     2.59%         2.43%          2.60%         2.44%
    General and administrative expense/average assets      1.00%          .88%           .99%          .86%
    Efficiency ratio (f)                                  32.99%        30.83%         32.77%        30.93%
</TABLE>

(a)  The current  rate  reflects  the actual rate being paid by the  borrower at
     time of origination.
(b)  Includes  a decrease  of $525  million of  wholesale  deposits  for the six
     months ended June 30, 1998.
(c)  Includes  the  effect  of the sale of three  branches  with a total of $119
     million in deposits  during the second  quarter of 1999 and the sale of one
     branch with $36 million in deposits in March of 1998.
(d)  Ratios are annualized by multiplying the quarterly  computation by four and
     the  semi-annual  computation  by two.  Averages are computed by adding the
     beginning  balance  and  each  monthend  balance  during  the  quarter  and
     six-month period and dividing by four and seven, respectively.
(e)  The ratios for the six months ended June 30, 1998 include the extraordinary
     item.  The ratios for the six months  ended  June 30,  1998  excluding  the
     extraordinary item are: ROE 16.13% and ROA 1.15%.
(f)  The efficiency ratio is calculated by dividing  general and  administrative
     expense by net interest income plus other income.



<PAGE>


         FINANCIAL CONDITION

         The  consolidated  condensed  balance  sheet  shown in the table  below
  presents the Company's  assets and liabilities in percentage terms at June 30,
  1999 and 1998, and December 31, 1998. The reader is referred to page 53 of the
  Company's  1998  Annual  Report on Form 10-K for similar  information  for the
  years 1995 through 1998 and a discussion of the changes in the  composition of
  the Company's assets and liabilities in those years.
<TABLE>
<CAPTION>

                                     TABLE 1

                      Consolidated Condensed Balance Sheet
                               In Percentage Terms

                                                                 June 30
                                                           --------------------           December 31
                                                            1999         1998                1998
                                                           -------      -------          -------------

       Assets:
<S>                                                           <C>          <C>                    <C>
          Cash and investments                                2.5%         1.9%                   2.7%
          Mortgage-backed securities                         31.6         23.3                   26.1
          Loans receivable                                   61.8         70.7                   66.9
          Other assets                                        4.1          4.1                    4.3
                                                           -------      -------                -------
                                                            100.0%       100.0%                 100.0%
                                                           =======      =======                =======
       Liabilities and Stockholders' Equity:
          Deposits                                           69.3%        64.0%                  68.1%
          Federal Home Loan Bank advances                    16.1         19.2                   16.0
          Securities sold under agreements to repurchase      1.8          4.6                    3.3
          Other liabilities                                   2.4          2.1                    2.1
          Subordinated debt                                   2.1          2.6                    2.4
          Stockholders' equity                                8.3          7.5                    8.1
                                                           -------      -------                -------
                                                            100.0%       100.0%                 100.0%
                                                           =======      =======                =======
</TABLE>

         For the first six months of 1999 and for the second  half of 1998,  the
Company securitized $3.7 billion and $2.5 billion,  respectively,  of loans into
mortgage-backed  securities  which  caused  the  percentage  of  mortgage-backed
securities  to total assets to increase  from June 30, 1998 to June 30, 1999 and
the  percentage  of loans  receivable  to total assets to decrease from June 30,
1998 to June 30, 1999. For further discussion, see pages 12 and 13.

         As the above  table  shows,  the  largest  asset  components  are loans
receivable and mortgage-backed securities,  which consist primarily of long-term
mortgages.  Deposits  represent the majority of the Company's  liabilities.  The
disparity between the repricing (maturity,  prepayment, or interest rate change)
of deposits and borrowings  and the repricing of mortgage loans and  investments
can  have a  material  impact  on  the  Company's  results  of  operations.  The
difference  between the repricing  characteristics  of assets and liabilities is
commonly referred to as "the gap."



<PAGE>


         The following gap table shows that, as of June 30, 1999,  the Company's
assets  reprice  sooner  than  its  liabilities.  If all  repricing  assets  and
liabilities responded equally to changes in the interest rate environment,  then
the gap analysis  would  suggest  that the  Company's  earnings  would rise when
interest rates increase and would fall when interest  rates  decrease.  However,
the Company's earnings are also affected by the built-in reporting and repricing
lags inherent in the Eleventh District Cost of Funds Index (COFI),  which is the
benchmark  Golden  West  uses  to  determine  the  rate on the  majority  of its
adjustable rate mortgages  (ARMs).  The reporting lag occurs because of the time
it takes to gather the data needed to compute the index.  As a result,  the COFI
in effect in any month actually  reflects the Eleventh  District's cost of funds
at the level it was two months prior.  The repricing lag occurs  because COFI is
based  on a  portfolio  of  accounts,  not  all of  which  reprice  immediately.
Therefore,  COFI does not initially  fully  reflect a change in market  interest
rates.  Consequently,  when the interest rate environment changes, the COFI lags
cause  assets to  initially  reprice  more  slowly than  liabilities,  enhancing
earnings when rates are falling and holding down income when rates rise.

<TABLE>
<CAPTION>

                                     TABLE 2

            Repricing of Interest-Earning Assets and Interest-Bearing
                   Liabilities, Repricing Gaps, and Gap Ratio
                               As of June 30, 1999
                              (Dollars in millions)

                                                             Projected Repricing(a)
                                       -------------------------------------------------------------------
                                         0 - 3         4 - 12        1 - 5          Over 5
                                         Months        Months        Years           Years        Total
                                       -----------   -----------   -----------   ------------  -----------
Interest-Earning Assets:
<S>                                       <C>          <C>           <C>             <C>          <C>
  Investments                             $   178      $    134      $    100        $   285      $   697
  Mortgage-backed securities               10,402           248           804            549       12,003
  Loans receivable:
    Rate-sensitive                         19,998         2,108           194            -0-       22,300
    Fixed-rate                                 64           164           481            360        1,069
  Other(b)                                    695           -0-           -0-            -0-          695
  Impact of interest rate swaps               400           280          (680)           -0-          -0-
                                       -----------   -----------   -----------   ------------  -----------
Total                                    $ 31,737      $  2,934      $    899        $ 1,194     $ 36,764
                                       ===========   ===========   ===========   ============  ===========
Interest-Bearing Liabilities(c):
  Deposits                               $ 15,363      $  9,542      $  1,413        $    18     $ 26,336
  FHLB advances                             5,700           -0-           122            289        6,111
  Other borrowings                            685           100           712            -0-        1,497
  Impact of interest rate swaps               158           (41)         (117)           -0-          -0-
                                       -----------   -----------   -----------   ------------  -----------
Total                                    $ 21,906      $  9,601      $  2,130        $   307     $ 33,944
                                       ===========   ===========   ===========   ============  ===========


Repricing gap                            $  9,831      $ (6,667)     $ (1,231)       $   887
                                       ===========   ===========   ===========   ============

Cumulative gap                           $  9,831      $  3,164      $  1,933        $ 2,820
                                       ===========   ===========   ===========   ============

Cumulative gap as a percentage of
    total assets                            25.9%          8.3%          5.1%
                                       ===========   ===========   ===========
</TABLE>

(a)  Based on scheduled maturity or scheduled  repricing;  loans and MBS reflect
     scheduled  repayments  and  projected  prepayments  of  principal  based on
     current rates of prepayment.
(b)  Includes cash in banks and Federal Home Loan Bank (FHLB) stock.
(c)  Liabilities  with no maturity  date,  such as checking,  passbook and money
     market deposit accounts, are assigned zero months.


<PAGE>


         CASH AND INVESTMENTS

         The Office of Thrift  Supervision (OTS) requires insured  institutions,
such as World Savings Bank, FSB (WFSB),  and World Savings and Loan  Association
(WSL), to maintain a minimum amount of cash and certain  qualifying  investments
for liquidity purposes. At June 30, 1999 and 1998 and at December 31, 1998, WFSB
and WSL had  liquidity in excess of the  regulatory  requirements.  The state of
Texas requires insured institutions,  such as World Savings Bank, SSB (WSSB), to
maintain a daily minimum amount of cash and certain  qualifying  investments for
liquidity  purposes.   WSSB  met  this  requirement  during  the  periods  under
discussion.

         At June 30,  1999 and 1998,  and  December  31,  1998,  the Company had
securities  available for sale in the amount of $381 million,  $416 million, and
$377 million,  respectively,  including unrealized gains on securities available
for sale of $321 million, $260 million, and $358 million,  respectively. At June
30, 1999 and 1998, and December 31, 1998, the Company had no securities held for
trading in its investment securities portfolio.

         Included in the  Company's  investment  portfolio  at June 30, 1999 and
1998, and December 31, 1998, were collateralized  mortgage obligations (CMOs) in
the amount of $166 million,  $45 million,  and $196 million,  respectively.  The
Company holds CMOs on which both  principal  and interest are received.  At June
30, 1999, all of these CMOs qualified for inclusion in the regulatory  liquidity
measurement. The Company does not hold any interest-only or principal-only CMOs.

         LOANS RECEIVABLE AND MORTGAGE-BACKED SECURITIES

         The Company invests in whole loans and mortgage-backed securities (MBS)
and, from time to time,  the Company  securitizes  loans from its portfolio into
MBS and Real Estate Mortgage Investment Conduit Securities (MBS-REMICs) that are
available to be used as collateral  for  borrowings.  At June 30, 1999 and 1998,
and December 31, 1998, the balance of loans receivable including mortgage-backed
securities was $35.5 billion,  $36.7 billion,  and $35.8 billion,  respectively.
Included  in the $35.5  billion at June 30,  1999,  was $3.3  billion of Federal
National  Mortgage  Association  (FNMA)  mortgage-backed   securities  with  the
underlying loans subject to full credit recourse to the Company and $8.1 billion
of  MBS-REMICs.  Included in the $35.8  billion at December 31,  1998,  was $3.9
billion of FNMA MBS with the underlying loans subject to full credit recourse to
the Company and $5.5  billion of  MBS-REMICs.  Included in the $36.7  billion at
June 30, 1998, was $4.5 billion of FNMA MBS with the underlying loans subject to
full credit recourse to the Company and $3.8 billion of MBS-REMICs.

         At June 30, 1999 and 1998,  and December 31, 1998,  the Company had MBS
held to maturity in the amount of $11.9 billion, $9.0 billion, and $9.9 billion,
respectively.  At June 30, 1999 and 1998, and December 31, 1998, the Company had
MBS  available  for sale in the amount of $93 million,  $136  million,  and $114
million,  respectively,  including unrealized gains on MBS available for sale of
$2 million, $6 million, and $5 million,  respectively. At June 30, 1999 and 1998
and December 31, 1998, the Company had no trading MBS.



<PAGE>


         The Company securitized $3.7 billion and $6.4 billion of mortgage loans
into  MBS-REMICs in the first six months of 1999 and for the year ended December
31, 1998, respectively.  MBS-REMICs are being used as collateral for borrowings.
The Company has the  ability  and intent to hold these MBS until  maturity  and,
accordingly, MBS-REMICs are classified as MBS held to maturity.

         During 1998, the Company  securitized  $1.8 billion of adjustable  rate
mortgages  (ARMs) into FNMA  COFI-indexed  MBS.  The Company has the ability and
intent  to hold  these  MBS  until  maturity  and,  accordingly,  these  MBS are
classified as held to maturity.  The FNMA MBS held to maturity are being used as
collateral for  borrowings  and the underlying  loans are subject to full credit
recourse to the Company.

         Repayments  of MBS during the  second  quarter  and first six months of
1999 were $795 million and $1.5 billion, respectively,  compared to $367 million
and $516 million  during the same periods of 1998.  MBS  repayments  were higher
during the first six months of 1999 as  compared to the first six months of 1998
due to an increase in total MBS  outstanding  and an increase in the  prepayment
rate of the underlying mortgages.

                LOAN VOLUME

         New loan originations for the three and six months ended June 30, 1999,
amounted  to $2.9  billion  and $4.9  billion,  respectively,  compared  to $2.1
billion  and $3.5  billion  for the same  periods  in 1998.  The high  volume of
originations during 1999 was due to a continued strong demand for home loans for
both purchases and refinances.  In addition,  the Company  increased the size of
its loan origination staff to take advantage of the favorable market conditions.
Refinanced loans  constituted 43% and 46% of new loan originations for the three
and six months  ended June 30,  1999,  compared to 42% and 43% for the three and
six months ended June 30, 1998.

         Loans originated for sale amounted to $317 million and $604 million for
the three and six months ended June 30, 1999,  compared to $212 million and $334
million for the same periods in 1998. In addition, during the second quarter and
first six months of 1999,  $300 million and $471 million of loans were converted
at the  customers  request from  adjustable  rate to fixed rate  compared to $35
million  and $43  million for the same  periods in 1998.  The Company  sold $425
million and $961 million of fixed-rate  loans for the three and six months ended
June 30, 1999,  respectively,  compared to $268 million and $400 million for the
same periods of 1998.

         At June 30, 1999, the Company had lending  operations in 27 states. The
largest  source  of  mortgage   origination  is  loans  secured  by  residential
properties in California.  For the three and six months ended June 30, 1999, 65%
and 64% of total loan originations were on residential  properties in California
compared to 62% and 61% for the same periods in 1998.  The five largest  states,
other than California,  for originations for the three and six months ended June
30, 1999, were Florida, Texas, Washington, Arizona, and Illinois with a combined
total of 19% of total  originations.  The percentage of the total loan portfolio
(including  mortgage-backed  securities  with recourse and  MBS-REMICs)  that is
comprised of  residential  loans in California was 65% at June 30, 1999 compared
to 66% at June 30, 1998 and December 31, 1998.

         The  Company  originates  adjustable  rate  mortgages  tied to  various
indexes,  including the Eleventh District Cost of Funds Index (COFI), the Golden
West Cost of Savings Index (COSI),  and the twelve-month  rolling average of the
One-Year Treasury Constant Maturity (TCM).


<PAGE>


     The following table shows the distribution of ARM originations by index for
the second quarter and first six months of 1999 and 1998.
<TABLE>
<CAPTION>

                                     TABLE 3

                 Adjustable Rate Mortgage Originations by Index
                             (Dollars in thousands)

                                  Three Months Ended              Six Months Ended
                                        June 30                        June 30
                              ----------------------------   ----------------------------
            ARM Index             1999            1998           1999            1998
       -------------------    ------------   -------------   ------------    ------------
<S>                           <C>            <C>             <C>             <C>
       COFI                   $   761,557    $  1,027,847    $ 1,310,190     $ 2,017,751
       COSI                     1,730,440         462,010      2,807,828         595,258
       TCM                         33,091         300,658         71,741         464,633
                              ------------   -------------   ------------    ------------
                              $ 2,525,088    $  1,790,515    $ 4,189,759     $ 3,077,642
                              ============   =============   ============    ============

</TABLE>


         The following  table shows the  distribution  by index of the Company's
outstanding  balance  of  adjustable  rate  mortgages  (including  ARM MBS  with
recourse and ARM MBS-REMICs) at June 30, 1999 and 1998 and December 31, 1998.
<TABLE>
<CAPTION>

                                     TABLE 4

                      Adjustable Rate Mortgage Portfolio by
                   Index (Including ARM MBS with recourse and
                                 ARM MBS-REMICs)
                             (Dollars in thousands)

                                          June 30
                              --------------------------------      December 31
             ARM Index             1999              1998              1998
        ------------------    --------------   ---------------   ---------------
<S>                            <C>                <C>              <C>
        COFI                   $ 26,986,275      $ 32,306,021      $ 29,761,484
        COSI                      4,343,877           601,496         1,703,283
        TCM                       1,210,583           528,337         1,256,775
        Other                       165,118           244,605           201,756
                              --------------   ---------------   ---------------
                               $ 32,705,853      $ 33,680,459      $ 32,923,298
                              ==============   ===============   ===============
</TABLE>



         The tables on the following two pages show the Company's loan portfolio
by state at June 30, 1999 and 1998.

<PAGE>

<TABLE>
<CAPTION>



                                     TABLE 5

                             Loan Portfolio by State
                                  June 30, 1999
                             (Dollars in thousands)

                          Residential
                          Real Estate                          Commercial                     Loans as
                    -------------------------                     Real           Total         a% of
     State            1 - 4           5+          Land           Estate         Loans(a)      Portfolio
----------------   ------------   -----------   ----------    --------------   -----------   ------------
<S>                <C>            <C>             <C>           <C>           <C>               <C>
California         $19,585,296    $ 3,306,202     $   200       $  34,185     $22,925,883       65.30%
Florida              1,515,516        16,661            1             508       1,532,686        4.37
Texas                1,404,240        61,801          482           1,288       1,467,811        4.18
Illinois             1,110,849       132,960          -0-             -0-       1,243,809        3.54
New Jersey           1,181,787           -0-          -0-           4,150       1,185,937        3.38
Colorado               895,407       175,984          -0-           5,457       1,076,848        3.07
Washington             578,534       447,979          -0-             670       1,027,183        2.93
Arizona                754,233        22,462          -0-             -0-         776,695        2.21
Other (b)            3,814,922        45,575           59          11,220       3,871,776       11.02
                   ------------   -----------   ----------   -------------    ------------   ---------
  Totals           $30,840,784    $4,209,624     $    742       $  57,478      35,108,628      100.00%
                   ============   ===========   ==========   =============                   =========

SFAS 91 net deferred loan costs                                                    28,432
Loan discount on purchased loans                                                   (2,199)
Undisbursed loan funds                                                             (3,803)
Allowance for loan losses                                                        (233,471)
Loans to facilitate (LTF) interest reserve                                           (356)
Troubled debt restructured (TDR) interest reserve                                  (1,414)
Loans on deposits                                                                  23,556
                                                                              ------------
   Total loan portfolio and loans securitized into FNMA MBS with recourse
   and MBS-REMICs                                                              34,919,373
Loans securitized into FNMA MBS with recourse and MBS-REMICs                  (11,433,486)(c)
                                                                              ------------
   Total loans receivable                                                     $23,485,887
                                                                              ============
</TABLE>

(a)  The  Company has no  commercial  loans  other than  commercial  real estate
     loans.
(b)  Includes states with loans less than 2% of total loans.
(c)  The above  schedule  includes the June 30, 1999 balances of loans that were
     securitized and retained as FNMA MBS with recourse and MBS-REMICs.



<PAGE>
<TABLE>
<CAPTION>


                                     TABLE 6

                             Loan Portfolio by State
                                  June 30, 1998
                             (Dollars in thousands)

                          Residential
                          Real Estate                          Commercial                     Loans as
                    -------------------------                     Real           Total         a% of
     State            1 - 4           5+          Land           Estate         Loans(a)      Portfolio
----------------   ------------   -----------   ----------    --------------   -----------   ------------
<S>                <C>            <C>             <C>           <C>           <C>               <C>
California         $20,354,069    $3,414,490      $   223       $  43,343     $23,812,125       65.83%
Florida              1,422,475        19,575            5             819       1,442,874        3.99
Texas                1,407,972        74,256          529           1,405       1,484,162        4.11
Illinois             1,202,328       158,430          -0-           1,529       1,362,287        3.77
New Jersey           1,240,886           -0-          -0-           5,267       1,246,153        3.45
Colorado             1,060,890       221,099          -0-           6,951       1,288,940        3.57
Washington             534,073       408,648          -0-             702         943,423        2.61
Arizona                761,859        25,980          -0-             532         788,371        2.18
Other (b)            3,721,150        54,135           73          13,880       3,789,238       10.49
                   ------------   -----------   ----------   -------------    ------------   ---------
  Totals           $31,705,702    $4,376,613      $   830       $  74,428      36,157,573      100.00%
                   ============   ===========   ==========   =============                   =========

SFAS 91 net deferred loan fees                                                    (28,652)
Loan discount on purchased loans                                                   (3,410)
Undisbursed loan funds                                                             (4,156)
Allowance for loan losses                                                        (239,537)
Loans to facilitate interest reserve                                                 (564)
Troubled debt restructured interest reserve                                        (2,869)
Loans on deposits                                                                  27,791
                                                                              ------------
  Total loan portfolio and loans securitized into FNMA MBS with recourse
  and MBS-REMIC                                                                35,906,176
Loans securitized into FNMA MBS with recourse and MBS-REMIC                    (8,306,056)(c)
                                                                              ------------
     Total loans receivable                                                   $27,600,120
                                                                              ============
</TABLE>

(a)  The  Company has no  commercial  loans  other than  commercial  real estate
     loans.
(b)  Includes states with loans less than 2% of total loans.
(c)  The above  schedule  includes the June 30, 1998 balances of loans that were
     securitized and retained as FNMA MBS with recourse and MBS-REMIC.



<PAGE>


         The Company  continues to emphasize ARM loans with interest  rates that
change  periodically  in accordance  with  movements in specified  indexes.  The
portion of the mortgage  portfolio  (including MBS and  MBS-REMICs)  composed of
rate-sensitive  loans was 92% at June 30, 1999,  1998 and December 31, 1998. The
Company's ARM  originations  for the first half of 1999  constituted  85% of new
mortgage loans made in 1999 compared to 87% for the first half of 1998.

         The weighted  average  maximum  lifetime cap rate on the  Company's ARM
loan portfolio  (including  ARMs swapped into MBS with recourse and  MBS-REMICs)
was 12.54%,  or 5.55% above the actual  weighted  average rate at June 30, 1999,
versus 12.67%, or 5.31% above the weighted average rate at June 30, 1998.

         Approximately  $4.8 billion of the Company's ARM loans  (including  MBS
with recourse and  MBS-REMICs)  have terms that state that the interest rate may
not fall below a lifetime floor set at the time of origination or assumption. As
of June 30, 1999,  $501 million of ARM loans had reached their rate floors.  The
weighted  average floor rate on the loans that had reached their floor was 7.62%
at June 30, 1999  compared  to 7.74% at June 30,  1998.  Without the floor,  the
average  rate on these loans would have been 7.11% at June 30, 1999 and 7.16% at
June 30, 1998.

         Loan repayments  consist of monthly loan amortization and loan payoffs.
For the three and six months  ended June 30,  1999,  loan  repayments  were $1.4
billion  and $2.7  billion,  respectively,  compared  to $1.7  billion  and $3.1
billion in the same periods of 1998.  Although  the balance of loans  receivable
was  smaller due largely to the  securitization  of loans into MBS,  prepayments
remained high due to the strong refinance and home sale activity.

         MORTGAGE SERVICING RIGHTS

         The Company  accounts for mortgage  servicing rights in accordance with
SFAS 125.  Capitalized  mortgage  servicing  rights  are  included  in  "Prepaid
expenses and other assets" on the Consolidated Statement of Financial Condition.
The following table shows the changes in capitalized  mortgage  servicing rights
for the three and six months ended June 30, 1999 and 1998.
<TABLE>
<CAPTION>

                                     TABLE 7

                      Capitalized Mortgage Servicing Rights
                             (Dollars in thousands)

                                                                    Three Months Ended              Six Months Ended
                                                                          June 30                        June 30
                                                                 --------------------------    --------------------------
                                                                     1999           1998           1999          1998
                                                                 -----------    -----------    -----------   ------------
<S>                                                                <C>            <C>            <C>            <C>
  Beginning balance of capitalized mortgage servicing rights       $ 35,250       $ 12,375       $ 28,635       $ 11,116
  New capitalized mortgage servicing rights from loan sales           7,491          4,437         16,459          6,588
  Amortization of capitalized mortgage servicing rights              (2,881)        (1,063)        (5,234)        (1,955)
                                                                 -----------    -----------    -----------   ------------
  Ending balance of capitalized mortgage servicing rights          $ 39,860       $ 15,749       $ 39,860       $ 15,749
                                                                 ===========    ===========    ===========   ============
</TABLE>

     The book value of Golden  West's  servicing  rights did not exceed the fair
value at June 30, 1999 or 1998 and,  therefore,  no  write-down of the servicing
rights to their fair value was necessary.


<PAGE>


         ASSET QUALITY

         One measure of the soundness of the Company's loan and MBS portfolio is
its ratio of nonperforming  assets (NPAs) to total assets.  Nonperforming assets
include non-accrual loans (loans, including loans swapped into MBS with recourse
and loans  securitized into  MBS-REMICs,  that are 90 days or more past due) and
real  estate  acquired  through  foreclosure.   No  interest  is  recognized  on
non-accrual loans. The Company's  troubled debt restructured  (TDRs) are made up
of  loans  on  which  delinquent  payments  have  been  capitalized  or on which
temporary  interest  rate  reductions  have been made,  primarily  to  customers
adversely impacted by economic conditions.

         The following table shows the components of the Company's NPAs and TDRs
and the various ratios to total assets.
<TABLE>
<CAPTION>

                                     TABLE 8

               Nonperforming Assets and Troubled Debt Restructured
                             (Dollars in thousands)

                                                            June 30
                                                   --------------------------    December 31
                                                      1999           1998           1998
                                                   -----------    -----------   --------------
<S>                                                 <C>            <C>             <C>
Non-accrual loans                                   $ 239,937      $ 302,922       $ 262,332
Real estate acquired through foreclosure               20,805         43,643          42,572
Real estate in judgment                                   439            -0-              74
                                                   -----------    -----------    ------------
Total nonperforming assets                          $ 261,181      $ 346,565       $ 304,978
                                                   ===========    ===========    ============

TDRs                                                $  15,896      $  31,978       $  22,774
                                                   ===========    ===========    ============

Ratio of NPAs to total assets                            .69%           .89%            .79%
                                                   ===========    ===========    ============

Ratio of TDRs to total assets                            .04%           .08%            .06%
                                                   ===========    ===========    ============

Ratio of NPAs and TDRs to total assets                   .73%           .97%            .85%
                                                   ===========    ===========    ============
</TABLE>

         The lower NPAs at June 30, 1999 as  compared  to June 30, 1998  reflect
primarily the strong economy and housing market,  especially in California.  The
Company  continues to closely monitor all  delinquencies  and takes  appropriate
steps to protect its interests.  Interest foregone on non-accrual loans amounted
to $1 million and $3 million in the second  quarter and first six months of 1999
compared  to $2 million and $5 million  for the same  periods in 1998.  Interest
foregone on TDRs  amounted to $108  thousand and $243 thousand for the three and
six months ended June 30, 1999,  compared to $241 thousand and $527 thousand for
the three and six months ended June 30, 1998.

         The  tables  on the  following  page show the  Company's  nonperforming
assets by state as of June 30, 1999 and 1998.


<PAGE>
<TABLE>
<CAPTION>


                                     TABLE 9

                          Nonperforming Assets by State
                                  June 30, 1999
                             (Dollars in thousands)

                             Non-Accrual Loans (a)                  Real Estate Owned
                      ----------------------------------    --------------------------------
                          Residential        Commercial                          Commercial                 NPAs as
                          Real Estate           Real            Residential         Real        Total        a% of
      State             1 -4         5+        Estate         1 - 4       5+       Estate      NPAs(b)       Loans
------------------    ---------   ---------  -----------     --------  ---------  ---------   ----------    --------
<S>                   <C>          <C>         <C>           <C>         <C>        <C>       <C>            <C>
California            $148,755     $ 2,958     $  1,787      $16,191     $  931     $  129    $ 170,751      .74%
Florida                 14,346         -0-           29          755        -0-        -0-       15,130      .99
Texas                    7,850         -0-          -0-          393        -0-        -0-        8,243      .56
Illinois                11,069         216          -0-          667        -0-        -0-       11,952      .96
New Jersey              15,784         -0-          371          156        -0-        -0-       16,311     1.38
Colorado                 2,249         -0-            3          372        -0-        -0-        2,624      .24
Washington               1,792         -0-          -0-           29        -0-        -0-        1,821      .18
Arizona                  4,323         -0-          -0-           84        -0-        -0-        4,407      .57
Other (c)               25,411         997        1,997        2,043        -0-        -0-       30,448      .79
                      ---------   ---------  -----------     --------  ---------  ---------   ----------    -----
  Totals              $231,579     $ 4,171     $  4,187      $20,690     $  931     $  129      261,687      .75%
                      =========   =========  ===========     ========  =========  =========

REO general valuation allowance                                                                    (506)    (.00)
                                                                                              ----------    -----
Total nonperforming assets                                                                     $261,181      .75%
                                                                                              ==========    =====
</TABLE>

(a)  Non-accruals loans are 90 days or more past due and have no unpaid interest
     accrued.
(b)  The June 30, 1999 balances  include loans that were  securitized  into FNMA
     MBS and MBS-REMICs.
(c)  Includes states with loans less than 2% of total loans.
<TABLE>
<CAPTION>

                                    TABLE 10

                          Nonperforming Assets by State
                                  June 30, 1998
                             (Dollars in thousands)

                            Non-Accrual Loans (a)                 Real Estate Owned
                      --------------------------------     -------------------------------
                          Residential       Commercial                          Commercial                 NPAs as
                          Real Estate          Real            Residential         Real        Total        a% of
      State             1 -4         5+       Estate        1 - 4        5+       Estate      NPAs(b)       Loans
------------------    ---------   ---------  ---------     --------   ---------  ---------    ---------    ---------
<S>                   <C>          <C>         <C>         <C>         <C>         <C>        <C>          <C>
California            $209,013     $10,454     $  453      $38,018     $ 1,389     $  -0-     $259,327     1.09%
Florida                 13,447         -0-        187          390         -0-        -0-       14,024      .97
Texas                    7,463         -0-        -0-        1,078         -0-        -0-        8,541      .58
Illinois                10,572         220        -0-          818         -0-        -0-       11,610      .85
New Jersey              17,249         -0-        210          704         -0-        -0-       18,163     1.46
Colorado                 1,904         -0-          3          -0-         -0-        -0-        1,907      .15
Washington               1,577         747        -0-          111         -0-        -0-        2,435      .26
Arizona                  1,700         -0-        -0-          493         -0-        -0-        2,193      .28
Other (c)               27,683          40        -0-        1,408         162         11       29,304      .77
                      ---------   ---------  ---------     --------   ---------  ---------    ---------    -----
  Totals              $290,608     $11,461     $  853      $43,020     $ 1,551     $   11      347,504      .96%
                      =========   =========  =========     ========   =========  =========

REO general valuation allowance                                                                   (939)    (.00)
                                                                                              ---------    -----
Total nonperforming assets                                                                    $346,565      .96%
                                                                                              =========    =====
</TABLE>

(a)  Non-accruals loans are 90 days or more past due and have no unpaid interest
     accrued.
(b)  The June 30, 1998 balances  include loans that were  securitized  into FNMA
     MBS and MBS-REMIC.
(c)  Includes states with loans less than 2% of total loans.


<PAGE>


         The Company provides specific valuation  allowances for losses on loans
  when  impaired,  and on real estate owned when any  significant  and permanent
  decline in value is  identified.  The Company also utilizes a methodology  for
  monitoring  and  estimating  loan  losses  that is  based  on both  historical
  experience  in the loan  portfolio  and factors  reflecting  current  economic
  conditions.  This approach uses a database that identifies losses on loans and
  foreclosed real estate from past years to the present,  broken down by year of
  origination,  type of loan, and geographical area.  Management is then able to
  estimate a range of general loss  allowances to cover losses in the portfolio.
  In addition,  periodic  reviews are made of major loans and real estate owned,
  and  major  lending  areas  are  regularly  reviewed  to  determine  potential
  problems.  Where indicated,  valuation allowances are established or adjusted.
  In estimating  possible  losses,  consideration is given to the estimated sale
  price,  cost of refurbishing,  payment of delinquent  taxes, cost of disposal,
  and  cost of  holding  the  property.  Additions  to and  reductions  from the
  allowances are reflected in current earnings.

         The table below shows the changes in the  allowance for loan losses for
the three and six months ended June 30, 1999 and 1998.
<TABLE>
<CAPTION>

                                    TABLE 11

                      Changes in Allowance for Loan Losses
                             (Dollars in thousands)

                                                                        Three Months Ended         Six Months Ended
                                                                              June 30                   June 30
                                                                     ------------------------  ------------------------
                                                                        1999         1998         1999         1998
                                                                     -----------  -----------  -----------   ----------
<S>                                                                   <C>          <C>          <C>          <C>
  Beginning allowance for loan losses                                 $ 236,476    $ 237,186    $ 244,466    $ 233,280
  Provision (recovery) charged to expense                                  (727)       2,682         (153)       5,647
  Transfer of allowance to reserve for losses
    on loans sold or securitized and retained                            (2,385)         -0-      (12,135)         -0-
  Less loans charged off, net                                              (225)        (467)         -0-          -0-
  Add recoveries                                                            332          136        1,293          610
                                                                     -----------  -----------  -----------   ----------
  Ending allowance for loan losses                                    $ 233,471    $ 239,537    $ 233,471    $ 239,537
                                                                     ===========  ===========  ===========   ==========
  Ratio of chargeoffs net of recoveries to average loans
    outstanding (including MBS with recourse and MBS-REMICs)               .00%         .00%        (.01%)        .00%
                                                                     ===========  ===========  ===========   ==========
</TABLE>

         As previously  mentioned,  the Company has  securitized  loans from its
portfolio into FNMA MBS with recourse and MBS-REMICs. The Company's intent is to
hold these MBS and  MBS-REMICs to maturity.  Because these loans  underlying the
MBS and  MBS-REMICs  are  similar  in all  respects  to the  loans  in its  loan
portfolio,  the Company  estimates  its reserve on these  securities in a manner
similar to the method it uses for the  allowance  for loan  losses.  The Company
also sells loans with full credit  recourse  and has  established  a reserve for
potential  losses on these loans.  The  liability for this reserve for losses on
loans sold or  securitized  and  retained is  included  in accounts  payable and
accrued expenses.



<PAGE>


         The table  below  shows the  changes in the reserve for losses on loans
  sold or  securitized  and retained for the three and six months ended June 30,
  1999 and 1998.
<TABLE>
<CAPTION>

                                    TABLE 12

 Changes in Reserve for Losses on Loans Sold with Recourse or Securitized and Retained
                             (Dollars in thousands)

                                                                        Three Months Ended         Six Months Ended
                                                                              June 30                   June 30
                                                                     ------------------------  ------------------------
                                                                        1999         1998         1999         1998
                                                                     -----------  -----------  -----------   ----------
  Beginning balance of reserve for losses on loans
<S>                                                                    <C>           <C>         <C>           <C>
    sold with recourse or securitized and retained                     $ 12,549      $ 1,023     $  2,256      $   886
  Initial recourse at time of sale charged to expense                       463          340        1,006          477
  Transfer from allowance for loan losses                                 2,385          -0-       12,135          -0-
                                                                     -----------  -----------  -----------   ----------
  Ending balance of reserve for losses on loans
    sold with recourse or securitized and retained                     $ 15,397      $ 1,363     $ 15,397      $ 1,363
                                                                     ===========  ===========  ===========   ==========
</TABLE>


         The ratio to nonperforming  assets of the allowance for loan losses and
  the reserve for losses on loans sold or securitized and retained was 95.3% and
  69.5% at June 30, 1999 and 1998, respectively.  At June 30, 1999 and 1998, the
  ratio to total loans  (including  MBS with  recourse  and  MBS-REMICs)  of the
  allowance  for loan  losses  and the  reserve  for  losses  on  loans  sold or
  securitized and retained was .71% and .67%, respectively.

         DEPOSITS

         Retail  deposits  decreased  during the  second  quarter of 1999 by $60
  million,  including interest credited of $265 million, compared to an increase
  of $434 million,  including  interest credited of $263 million,  in the second
  quarter of 1998.  Retail deposits  increased  during the first half of 1999 by
  $117 million,  including  interest  credited of $510  million,  compared to an
  increase of $1.4 billion,  including interest credited of $508 million, in the
  first half of 1998.  During the second quarter of 1999, the Company sold three
  branches with a total of $119 million in deposits. During the first quarter of
  1998, the Company sold one branch with $36 million in deposits. Retail deposit
  balances were essentially  unchanged  during 1999 as the Company  concentrated
  marketing  efforts on  building  the loyalty of  existing  depositors.  Retail
  deposits  increased  during  the first half of 1998  primarily  due to ongoing
  marketing  efforts as well as active  promotions  of market  rate  transaction
  accounts.  At June 30, 1999 and 1998,  transaction  accounts  (which  includes
  checking,  passbook,  and  money  market  accounts)  represented  39% and 27%,
  respectively, of the total balance of deposits.

         Beginning  in  January  1997,  the  Company  began  a  program  to  use
government   securities  dealers  to  sell  certificates  of  deposit  (CDs)  to
institutional investors (wholesale CDs). There were no outstanding wholesale CDs
at June 30, 1999 or at June 30, 1998.




<PAGE>


         The table below shows the  Company's  deposits by interest  rate and by
remaining maturity at June 30, 1999 and 1998.
<TABLE>
<CAPTION>

                                    TABLE 13

                                    Deposits
                              (Dollars in millions)

                                                                                 June 30
                                                           ---------------------------------------------------
                                                                     1999                       1998
                                                           ------------------------   ------------------------
                                                             Rate*         Amount       Rate*        Amount
                                                           ---------    -----------   ------------------------
    Deposits by rate:
<S>                                                            <C>       <C>              <C>       <C>
      Interest-bearing checking accounts (a)                   3.42%      $    109        3.23%      $     84
      Passbook accounts                                        1.82            507        2.22            544
      Money market deposit accounts (a)                        4.11          9,646        4.28          6,040
      Term certificate accounts with original maturities of:
        4 weeks to 1 year                                      4.40          5,270        5.10          7,977
        1 to 2 years                                           4.94          7,572        5.44          6,688
        2 to 3 years                                           5.27          1,379        5.46          1,458
        3 to 4 years                                           5.21            330        5.34            372
        4 years and over                                       5.72            950        5.76          1,208
      Retail jumbo CDs                                         4.70            573        5.34            622
      Wholesale CDs                                            0.00            -0-        0.00            -0-
      All other                                                0.00            -0-        7.56              1
                                                                        -----------               ------------
                                                                          $ 26,336                   $ 24,994
                                                                        ===========               ============


                                                                            1999                      1998
                                                                        -----------               ------------
    Deposits by remaining maturity:
        No contractual maturity                                           $ 10,262                   $  6,668
        Maturity within one year                                            14,645                     16,056
        1 to 5 years                                                         1,412                      2,259
        Over 5 years                                                            17                         11
                                                                        -----------               ------------
                                                                          $ 26,336                   $ 24,994
                                                                        ===========               ============
</TABLE>

* Weighted average interest rate, including the impact of interest rate swaps.

(a)  At June 30, 1999, $3.1 billion of  interest-bearing  checking accounts were
     swept into money market deposit accounts.

         At June 30, the weighted  average cost of deposits was 4.50% (1999) and
4.99% (1998).

         ADVANCES FROM FEDERAL HOME LOAN BANKS

         The Company uses  borrowings  from FHLBs,  also known as "advances," to
supplement  cash  flow and to  provide  funds for loan  origination  activities.
Advances  are secured by pledges of certain  loans,  MBS-REMICs,  other MBS, and
capital stock of FHLBs. FHLB advances amounted to $6.1 billion at June 30, 1999,
compared to $7.5  billion and $6.2  billion at June 30,  1998,  and December 31,
1998,  respectively.  During 1998, the Company paid off, before  maturity,  $4.4
billion of high-cost FHLB of San Francisco advances and, as a result, incurred a
$21 million pre-tax charge for the penalties  associated with these prepayments.
See Extraordinary Item discussion on page 31.


<PAGE>


         SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE

         The Company borrows funds through  transactions in which securities are
sold under agreements to repurchase  (Reverse Repos).  Reverse Repos are entered
into with selected major  government  securities  dealers,  large banks, and the
Federal Home Loan Bank of San Francisco,  typically using MBS from the Company's
portfolio.  Reverse Repos with dealers,  banks and the Federal Home Loan Bank of
San Francisco amounted to $685 million,  $1.8 billion,  and $1.3 billion at June
30, 1999 and 1998, and December 31, 1998, respectively.

         The Company uses  accounting and reporting  standards for transfers and
servicing of financial assets and  extinguishments  of liabilities in accordance
with SFAS 125 and SFAS 127.

         OTHER BORROWINGS

         At June 30, 1999,  Golden West,  at the holding  company  level,  had a
total of $812 million of subordinated  debt issued and  outstanding.  As of June
30, 1999, the Company's  subordinated  debt  securities  were rated A3 and A- by
Moody's Investors  Service (Moody's) and Standard & Poor's (S&P),  respectively.
At June 30,  1999,  Golden West had on file a  registration  statement  with the
Securities  and  Exchange  Commission  for the  sale of up to  $300  million  of
subordinated notes.

         During  November 1996,  WFSB received  permission from the OTS to issue
non-convertible medium-term notes to institutional investors under rules similar
to Office of the  Comptroller  of the  Currency  rules  applicable  to similarly
situated  national  banks.  As of June 30,  1999,  WFSB had not issued any notes
under this authority.

         STOCKHOLDERS' EQUITY

         The  Company's  stockholders'  equity  increased  during  the first six
months of 1999 as a result of net earnings  partially offset by decreased market
values of securities  available for sale, the payment of quarterly  dividends to
stockholders,  and the $170 million cost of the repurchase of Company stock. The
Company's  stockholders' equity increased during the first six months of 1998 as
a result of net earnings and increased market values of securities available for
sale  partially  offset by the payment of quarterly  dividends to  stockholders.
Unrealized  gains,  net of  taxes,  on  securities  and MBS  available  for sale
included in  stockholders'  equity at June 30, 1999 and 1998,  and  December 31,
1998, were $195 million, $157 million, and $215 million, respectively.

         From time to time,  the  Company's  capital  ratios may build to levels
well in excess of the amounts necessary to meet regulatory capital requirements.
Golden West's Board of Directors periodically reviews alternative uses of excess
capital,  including  faster  growth and  acquisitions.  At times,  the Board has
determined  that the  purchase of the  Company's  common  stock is a wise use of
excess capital.


<PAGE>


         Since 1993,  through  three  separate  actions,  Golden West's Board of
Directors  has  authorized  the  purchase by the  Company of up to 12.2  million
shares of Golden West's common stock.  As of June 30, 1999,  11.3 million shares
had been  repurchased  and retired at a cost of $630 million since October 1993,
of which 1.8 million shares were purchased and retired at a cost of $170 million
during the first six months of 1999.  On July 22, 1999,  Golden  West's Board of
Directors  authorized  the purchase by the Company of an additional  2.8 million
shares of its common stock. Dividends from subsidiaries are expected to continue
to be the major source of funding for the stock repurchase program. The purchase
of Golden  West stock is not  intended  to have a material  impact on the normal
liquidity of the Company.

         The  Company  has on  file a  shelf  registration  statement  with  the
Securities  and  Exchange  Commission  to issue up to two million  shares of its
preferred  stock.  The preferred stock may be issued in one or more series,  may
have varying  provisions and designations,  and may be represented by depository
shares.  The preferred stock is not convertible  into common stock. No preferred
stock has been issued under the registration.  The Company's preferred stock has
been preliminarily rated a2 by Moody's.

         REGULATORY CAPITAL

         The OTS requires federally insured institutions,  such as WFSB and WSL,
to meet certain minimum capital  requirements.  The following table shows WFSB's
regulatory  capital ratios and compares them to the OTS minimum  requirements at
June 30, 1999 and 1998.
<TABLE>
<CAPTION>

                                    TABLE 14

                             World Savings Bank, FSB
                            Regulatory Capital Ratios
                             (Dollars in thousands)

                              June 30, 1999                                     June 30, 1998
              -----------------------------------------------   ----------------------------------------------
                     ACTUAL                  REQUIRED                  ACTUAL                  REQUIRED
              ----------------------   ----------------------   ----------------------   ---------------------
               Capital      Ratio       Capital      Ratio       Capital      Ratio       Capital      Ratio
              -----------  ---------   -----------  ---------   ----------   ---------   ----------   --------
<S>           <C>           <C>        <C>           <C>       <C>            <C>       <C>            <C>
  Tangible    $2,336,862    7.01%      $  499,791    1.50%     $1,929,619     6.69%     $  432,456     1.50%
  Core         2,336,862    7.01        1,332,775    4.00       1,929,619     6.69       1,153,217     4.00
  Risk-based   2,483,193   12.95        1,533,886    8.00       2,013,581    12.91       1,259,075     8.00

</TABLE>

     The  following  table shows WSL's  current  regulatory  capital  ratios and
compares them to the OTS minimum requirements at June 30, 1999 and 1998.
<TABLE>
<CAPTION>

                                    TABLE 15

                       World Savings and Loan Association
                            Regulatory Capital Ratios
                             (Dollars in thousands)

                               June 30, 1999                                      June 30, 1998
              ------------------------------------------------   ------------------------------------------------
                      ACTUAL                   REQUIRED                 ACTUAL                   REQUIRED
              -----------------------   ----------------------   ----------------------   -----------------------
               Capital       Ratio       Capital      Ratio       Capital       Ratio      Capital       Ratio
              -----------   ---------   -----------  ---------   -----------   --------   -----------   ---------
<S>            <C>           <C>         <C>           <C>       <C>            <C>       <C>            <C>
  Tangible     $ 548,213     9.52%       $  86,344     1.50%     $  892,726     9.00%     $  148,730     1.50%
  Core           548,213     9.52          230,252     4.00         892,726     9.00         396,614     4.00
  Risk-based     584,207    18.60          251,217     8.00       1,067,516    17.78         480,347     8.00

</TABLE>


<PAGE>


         In addition,  institutions  whose  exposure to interest  rate risk,  as
determined  by the OTS,  is deemed to be above  normal may be  required  to hold
additional  risk-based capital. The OTS has determined that neither WFSB nor WSL
has above-normal exposure to interest rate risk.

         The  OTS  has   adopted   rules   based   upon  five   capital   tiers:
well-capitalized,   adequately  capitalized,   undercapitalized,   significantly
undercapitalized,  and critically undercapitalized. The determination of whether
an  association  falls into a certain  classification  depends  primarily on its
capital ratios.  As of June 30, 1999, the most recent  notification from the OTS
categorized  both  WFSB  and  WSL  as   "well-capitalized"   under  the  current
requirements.  There are no conditions  or events that have occurred  since that
notification   that  the   Company   believes   would  have  an  impact  on  the
categorization of either WFSB or WSL.

         The table  below  shows that  WFSB's  regulatory  capital  exceeds  the
requirements of the well-capitalized classification at June 30, 1999.
<TABLE>
<CAPTION>

                                    TABLE 16

                             World Savings Bank, FSB
         Regulatory Capital Compared to Well-Capitalized Classification
                             (Dollars in thousands)

                                                  ACTUAL                       WELL-CAPITALIZED
                                           ------------------------       --------------------------
                                            Capital       Ratio              Capital        Ratio
                                           -----------   ----------       ------------   -----------
<S>                                      <C>                <C>           <C>                <C>
        Leverage                         $ 2,336,862        7.01%         $ 1,665,968        5.00%
        Tier 1 risk-based                  2,336,862       12.19            1,150,415        6.00
        Total risk-based                   2,483,193       12.95            1,917,358       10.00
</TABLE>

         The table  below  shows  that  WSL's  regulatory  capital  exceeds  the
requirements of the well-capitalized classification at June 30, 1999.
<TABLE>
<CAPTION>

                                    TABLE 17

                       World Savings and Loan Association
         Regulatory Capital Compared to Well-Capitalized Classification
                             (Dollars in thousands)

                                                    ACTUAL                     WELL-CAPITALIZED
                                           ------------------------       --------------------------
                                            Capital       Ratio              Capital        Ratio
                                           -----------   ----------       ------------   -----------
<S>                                        <C>              <C>            <C>               <C>
        Leverage                           $ 548,213        9.52%          $  287,815        5.00%
        Tier 1 risk-based                    548,213       17.46              188,413        6.00
        Total risk-based                     584,207       18.60              314,022       10.00

</TABLE>


<PAGE>


         World  Savings  Bank,  SSB is  regulated  by the FDIC and the  state of
Texas.  At June 30, WSSB had the  following  regulatory  capital  calculated  in
accordance with the FDIC's capital standards:
<TABLE>
<CAPTION>

                                    TABLE 18

                             World Savings Bank, SSB
                            Regulatory Capital Ratios
                             (Dollars in thousands)

                                  June 30, 1999                                     June 30, 1998
                  -----------------------------------------------   ----------------------------------------------
                         ACTUAL                  REQUIRED                  ACTUAL                 REQUIRED
                  ----------------------   ----------------------   ----------------------  ----------------------
                   Capital       Ratio      Capital      Ratio       Capital      Ratio      Capital      Ratio
                  -----------   --------   -----------  ---------   ----------   ---------  -----------  ---------
<S>                <C>           <C>       <C>           <C>        <C>          <C>          <C>         <C>
 Tier 1 leverage   $ 194,087     5.41%     $ 107,577     3.00%      $ 123,638    11.38%       $ 32,583    3.00%
 Tier 1 risk-based   194,087    26.19         29,648     4.00         123,638    24.08          20,537    4.00
 Total risk-based    194,301    26.21         59,296     8.00         123,824    24.12          41,074    8.00

</TABLE>


RESULTS OF OPERATIONS

         NET EARNINGS

         Net earnings for the three months ended June 30, 1999 were $122 million
compared to net  earnings of $117  million for the three  months  ended June 30,
1998.  Net  earnings  for the six months  ended June 30, 1999 were $243  million
compared to net  earnings of $227  million,  before an  extraordinary  item (see
extraordinary  item  discussion  on page 32),  for the six months ended June 30,
1998. Net earnings increased for the first six months of 1999 as compared to the
same period in 1998 as a result of increased net interest  income, a decrease in
the provision for loan losses, increased non-interest income before the one-time
gains (see non-interest income discussion on page 31), and a lower effective tax
rate.  These  increases to net earnings were partially  offset by an increase in
general and administrative expenses.


<PAGE>


         SPREADS

         An  important  determinant  of the  Company's  earnings  is its primary
spread -- the  difference  between  its yield on earning  assets and its cost of
funds.  The table below shows the components of the Company's spread at June 30,
1999 and 1998, and December 31, 1998.
<TABLE>
<CAPTION>

                                    TABLE 19

                            Yield on Earning Assets,
                        Cost of Funds, and Primary Spread

                                                         June 30
                                               ----------------------------        December 31
                                                  1999            1998                1998
                                               ------------    ------------       -------------
<S>                                                <C>             <C>                <C>
Yield on loan portfolio                            7.06%           7.51%              7.36%
Yield on MBS                                       7.07            7.23               7.20
Yield on investments                               6.45            6.89               5.53
                                               ---------       ---------          ---------
Yield on earning assets                            7.06            7.44               7.30
                                               ---------       ---------          ---------
Cost of deposits                                   4.50            4.99               4.67
Cost of borrowings                                 5.59            6.02               5.87
                                               ---------       ---------          ---------
Cost of funds                                      4.75            5.29               4.96
                                               ---------       ---------          ---------
Primary spread                                     2.31%           2.15%              2.34%
                                               =========       =========          =========
</TABLE>

         The Company holds ARMs to manage the rate sensitivity of the asset side
of the balance  sheet.  The yield on the Company's  ARM  portfolio  tends to lag
changes  in market  interest  rates  because  of lags  related  to the index and
because of certain loan features.  These features include  introductory rates on
new ARM loans,  the interest rate  adjustment  frequency of ARM loans,  interest
rate caps or limits on individual rate changes and interest rate floors. Most of
the Company's ARMs have interest  rates that change in accordance  with an index
based on the cost of deposits and  borrowings of savings  institutions  that are
members of the FHLB of San Francisco (the COFI).  On balance,  COFI lags and ARM
structural  features cause the Company's assets initially to reprice more slowly
than its liabilities,  resulting in a temporary reduction in net interest income
when rates increase and a temporary  increase in net interest  income when rates
fall.



<PAGE>


         The  following  table shows the  Company's  revenues  and expenses as a
percentage  of total  revenues  for the three and six months ended June 30, 1999
and 1998, in order to focus on the changes in interest  income  between years as
well as changes in other revenue and expense amounts.
<TABLE>

                                    TABLE 20

                       Selected Revenue and Expense Items
                        as Percentages of Total Revenues

                                                              Three Months Ended          Six Months Ended
                                                                    June 30                   June 30
                                                             ----------------------    -----------------------
                                                               1999         1998         1999         1998
                                                             ---------    ---------    ----------   ----------
<S>                                                              <C>          <C>           <C>          <C>
        Interest on loans(a)                                     61.2%        74.9%         63.1%        77.7%
        Interest on mortgage-backed securities(a)                26.0         13.5          24.6         11.4
        Interest and dividends on investments                     7.0          6.1           6.9          6.5
                                                             ---------    ---------    ----------   ----------
                                                                 94.2         94.5          94.6         95.6
        Less:
          Interest on deposits                                   42.1         41.0          42.1         40.6
          Interest on advances and other borrowings              18.0         23.0          18.3         24.1
                                                             ---------    ---------    ----------   ----------
                                                                 60.1         64.0          60.4         64.7

        Net interest income                                      34.1         30.5          34.2         30.9
          Provision for (recovery of) loan losses                 (.1)          .3           0.0           .4
                                                             ---------    ---------    ----------   ----------
        Net interest income after provision for loan losses      34.2         30.2          34.2         30.5

        Add:
          Fees                                                    2.3          2.0           2.3          1.8
          Gain on the sale of securities, MBS, and loans          1.1          2.4           1.3          1.4
          Other non-interest income                               2.4          1.1           1.8          1.2
                                                             ---------    ---------    ----------   ----------
                                                                  5.8          5.5           5.4          4.4
        Less:
          General and administrative expenses                    13.2         11.1          13.0         10.9
          Taxes on income                                        10.0          9.7          10.0          9.5
                                                             ---------    ---------    ----------   ----------
        Earnings before extraordinary item                       16.8         14.9          16.6         14.5
        Extraordinary item                                        0.0          0.0           0.0          (.5)
                                                             ---------    ---------    ----------   ----------
        Net earnings                                             16.8%        14.9%         16.6%        14.0%
                                                             =========    =========    ==========   ==========

</TABLE>

(a)  During the six months  ended June 30, 1999 and the year ended  December 31,
     1998, the Company securitized $3.7 billion and $8.2 billion,  respectively,
     of  loans  into  MBS  which   caused  the   percentage   of   interest   on
     mortgage-backed securities to total revenues to increase from June 30, 1998
     to June 30, 1999 and the  percentage of interest on loans to total revenues
     to decrease  from June 30, 1998 to June 30, 1999.  For further  discussion,
     see pages 12 and 13.



<PAGE>


         INTEREST RATE SWAPS

         The Company  enters into  interest rate swaps as a part of its interest
rate risk management strategy. Such instruments are entered into solely to alter
the repricing characteristics of designated assets and liabilities.  The Company
does not hold any derivative financial instruments for trading purposes.

         Interest  rate swap  activity  decreased  net  interest  income by $927
thousand and $3.7  million for the three and six months ended June 30, 1999,  as
compared to decreases of $2 million and $4 million for the same periods in 1998.

         The following  table  summarizes  the  unrealized  gains and losses for
interest rate swaps at June 30, 1999 and 1998.
<TABLE>
<CAPTION>

                                    TABLE 21

         Schedule of Unrealized Gains and Losses on Interest Rate Swaps
                             (Dollars in thousands)

                                         June 30, 1999                              June 30, 1998
                            ----------------------------------------   ----------------------------------------
                                                            Net                                        Net
                                                        Unrealized                                 Unrealized
                            Unrealized    Unrealized       Gain        Unrealized    Unrealized       Gain
                               Gains        Losses        (Loss)          Gains        Losses        (Loss)
                            ------------  ------------  ------------   ------------  ------------  ------------
Interest rate swaps:
<S>                           <C>           <C>           <C>           <C>           <C>           <C>
  Receive fixed               $     917     $     150     $     767     $   6,779     $     303    $    6,476
  Pay fixed                       3,631        15,643       (12,012)          436        34,226       (33,790)
                            ------------  ------------  ------------   ------------  ------------ -------------
                              $   4,548     $  15,793     $ (11,245)    $   7,215     $  34,529    $  (27,314)
                            ============  ============  ============   ============  ============ =============
</TABLE>
<TABLE>
<CAPTION>


                                    TABLE 22

                    Schedule of Interest Rate Swaps Activity
                         (Notional amounts in millions)

                                             Six Months Ended
                                               June 30, 1999
                                        ----------------------------
                                          Receive           Pay
                                           Fixed           Fixed
                                           Swaps           Swaps
                                        ------------    ------------
<S>                                         <C>             <C>
Balance at December 31, 1998                $   512         $   899
Additions                                       -0-             -0-
Maturities                                     (237)            (77)
                                        ------------    ------------
Balance at June 30, 1999                    $   275         $   822
                                        ============    ============
</TABLE>


         The range of floating  interest rates received on swap contracts in the
first six months of 1999 was 4.97% to 5.47%, and the range of floating  interest
rates paid on swap  contracts  was 4.99% to 5.29%.  The range of fixed  interest
rates  received on swap  contracts  in the first six months of 1999 was 5.50% to
8.66% and the range of fixed  interest rates paid on swap contracts was 5.58% to
9.14%.


<PAGE>


         INTEREST ON LOANS

         In the second quarter of 1999,  interest on loans was lower than in the
comparable  1998  period by $142  million or 24.2%.  The  decrease in the second
quarter of 1999 was due to a $6.5  billion  decrease  in the  average  portfolio
balance and a 33 basis point decrease in the average  portfolio  yield.  For the
first  half of 1999,  interest  on loans was lower than in the  comparable  1998
period by $294 million or 24.2%. The decrease was due to a $6.9 billion decrease
in the average  portfolio  balance and a 27 basis point  decrease in the average
portfolio  yield.  The  decrease  in the  average  loan  portfolio  balance  was
primarily due to the  securitization  of loans into FNMA MBS and MBS-REMICs (see
pages 12 and 13).

         INTEREST ON MORTGAGE-BACKED SECURITIES

         In the second quarter of 1999,  interest on mortgage-backed  securities
was higher than in the comparable 1998 period by $84 million or 79.4%.  The 1999
increase was due primarily to a $4.9 billion  increase in the average  portfolio
balance,  which was partially  offset by a 7 basis point decrease in the average
portfolio  yield.  For the  first  half of  1999,  interest  on  mortgage-backed
securities  was higher than in the  comparable  1998  period by $180  million or
101.5%  due  primarily  to a $5.2  billion  increase  in the  average  portfolio
balance,  which was partially offset by a 10 basis point decrease in the average
portfolio yield.  The increase in the  mortgage-backed  securities  portfolio is
primarily due to the  securitization  of loans into FNMA MBS and MBS-REMICs,  as
discussed on pages 12 and 13.

         INTEREST AND DIVIDENDS ON INVESTMENTS

         The income earned on the  investment  portfolio  fluctuates,  depending
upon the volume outstanding and the yields available on short-term  investments.
For the second quarter of 1999, interest and dividends on investments was higher
than in the  comparable  1998 period by $2.7  million or 5.7%.  The increase was
primarily due to a $743 million increase in the average portfolio balance, which
was  partially  offset by a 71 basis point  decrease  in the  average  portfolio
yield.  For the first half of 1999,  interest and dividends on  investments  was
lower than in the  comparable  1998 period by $1.4 million or 1.4%. The decrease
was primarily due to a 70 basis point  decrease in the average  portfolio  yield
which was partially offset by a $385 million  increase in the average  portfolio
balance.

         INTEREST ON DEPOSITS

         In the second  quarter of 1999,  interest on deposits  decreased by $15
million or 4.7% from the comparable  period in 1998. The second quarter decrease
was due to a 50 basis point decrease in the average cost of deposits,  which was
partially  offset by a $1.5 billion increase in the average balance of deposits.
In the first half of 1999, interest on deposits decreased by $23 million or 3.6%
from the comparable  period in 1998. The six month decrease was primarily due to
a 47 basis point  decrease in the average cost of deposits,  which was partially
offset by a $1.6 billion increase in the average balance of deposits.



<PAGE>


         INTEREST ON ADVANCES AND OTHER BORROWINGS

         For the second quarter and first half of 1999, interest on advances and
other  borrowings  decreased  by $50 million or 27.5% and $109 million or 29.0%,
respectively,  from the comparable  periods of 1998. The second quarter decrease
was  primarily  due to a $2.5 billion  decrease in the average  balance and a 50
basis  point  decrease in the average  cost of these  borrowings.  The six month
decrease was primarily due to a $3.0 billion decrease in the average balance and
a 43 basis point decrease in the average cost of these borrowings.

         PROVISION FOR (RECOVERY OF) LOAN LOSSES

         The  recovery  of loan  losses  was $727  thousand  and $153  thousand,
respectively,  for the three and six months ended June 30,  1999,  compared to a
provision  for loan losses of $3 million and $6 million for the same  periods in
1998.  The decrease in the provision in 1999 was due to declining  nonperforming
assets and lower loan losses as a result of the strong California housing market
and economy.

         NON-INTEREST INCOME

         Non-interest income was $43 million and $78 million,  respectively, for
the three and six months  ended June 30,  1999,  compared to $43 million and $69
million for the same periods in 1998.  Non-interest income for the three and six
months ended June 30, 1999  included  gains of $7 million from the sale of three
savings offices located in markets with limited growth  potential.  Non-interest
income for the three and six months ended June 30, 1998,  included a gain of $13
million  before tax from the  redemption of preferred  stock which was called by
the  issuer and  non-interest  income  for the six  months  ended June 30,  1998
included a gain of $3 million from the sale of one savings  branch.  Without the
effects  of these  one-time  gains,  non-interest  income  for the three and six
months ended June 30, 1999,  was $35 million and $70 million,  respectively,  as
compared  to $30  million  and $53  million  for the same  periods in 1998.  The
increases in 1999 as compared to 1998 resulted from higher loan  prepayment fees
and increased gains on the sale of fixed-rate mortgages.

         GENERAL AND ADMINISTRATIVE EXPENSES

         For  the  second   quarter   and  first  half  of  1999,   general  and
administrative  expenses (G&A) were $96 million and $189 million,  respectively,
compared to $87 million and $171 million for the comparable periods in 1998. G&A
as a percentage  of average  assets on an  annualized  basis was 1.00% and .99%,
respectively, for the second quarter and first half of 1999 compared to .88% and
 .86%, respectively, for the same periods in 1998. G&A expenses increased in 1999
because of normal increases in employee compensation,  the expansion of the loan
origination organization to take advantage of opportunities to increase mortgage
volume,  and  investments  in new  computers and  automated  teller  machines to
enhance customer service in our branches.



<PAGE>


     EXTRAORDINARY ITEM

     During the first quarter of 1998,  the Company paid off,  before  maturity,
$2.9 billion of  high-cost  FHLB of San  Francisco  advances.  As a result,  the
Company  incurred a $13 million  pretax  charge in the first quarter of 1998 for
the penalties associated with the prepayments. In addition, in the third quarter
of 1998, the Company paid off,  before  maturity,  an additional $1.5 billion of
high-cost FHLB advances.  As a result, the Company incurred an $8 million pretax
charge  in the  third  quarter  of 1998 for the  penalties  associated  with the
prepayments.

     TAXES ON INCOME

     The  Company  utilizes  the  accrual  method of  accounting  for income tax
purposes and for  preparing its published  financial  statements.  For financial
reporting purposes only, the Company uses purchase accounting in connection with
certain assets acquired  through  mergers.  The purchase  accounting  portion of
income is not subject to tax.

     Taxes as a percentage of earnings before the extraordinary item were 37.5%,
for the  second  quarter  and first  half of 1999  compared  to 39.3% and 39.6%,
respectively,  for the same  periods a year ago. The decrease in the tax rate in
1999 as  compared to 1998 was due to a lower  overall  state tax rate due to the
expansion of business in lower taxing states.


LIQUIDITY AND CAPITAL RESOURCES

     WFSB's  principal  sources of funds are cash flows generated from earnings;
deposits;  loan repayments;  sales of loans; negotiable certificates of deposit;
borrowings from the FHLB;  investments and borrowings from its affiliates;  debt
collateralized  by mortgages,  MBS, or securities.  In addition,  WFSB has other
alternatives  available  to provide  liquidity or finance  operations  including
federal funds purchased,  borrowings from public offerings of debt, issuances of
commercial  paper,  and borrowings from  commercial  banks.  Furthermore,  under
certain  conditions,  WFSB may  borrow  from  the  Federal  Reserve  Bank of San
Francisco to meet  short-term cash needs.  The  availability of these funds will
vary  depending  upon  policies  of the FHLB,  the Federal  Reserve  Bank of San
Francisco,  and the Federal Reserve Board.  For a discussion of WFSB's liquidity
positions at June 30, 1999,  and 1998,  and December 31, 1998,  see the Cash and
Investments section on page 12.

     WSL's  principal  sources of funds are cash flows  generated from earnings;
deposits;  loan repayments;  borrowings from the FHLB and debt collateralized by
mortgages,  MBS,  or  securities.  In  addition,  WSL  has  a  number  of  other
alternatives available to provide liquidity or finance operations. These include
federal funds purchased, borrowings from its affiliates,  borrowings from public
offerings of debt, sales of loans, negotiable certificates of deposit, issuances
of commercial  paper, and borrowings from commercial banks.  Furthermore,  under
certain  conditions,  WSL  may  borrow  from  the  Federal  Reserve  Bank of San
Francisco to meet  short-term cash needs.  The  availability of these funds will
vary  depending  upon  policies  of the FHLB,  the Federal  Reserve  Bank of San
Francisco,  and the Federal  Reserve Board.  For a discussion of WSL's liquidity
positions at June 30, 1999,  and 1998,  and December 31, 1998,  see the Cash and
Investments section on page 12.



<PAGE>


         WSSB's  principal  sources  of funds  are  cash  flows  generated  from
earnings;  deposits;  loan  repayments;  borrowings  from the FHLB Dallas;  debt
collateralized by mortgages or securities; and borrowings from its affiliates.

         The principal  sources of funds for WFSB's,  WSL's,  and WSSB's parent,
Golden West, are dividends from subsidiaries,  interest on investments,  and the
proceeds from the issuance of debt and equity securities.  Various statutory and
regulatory  restrictions  and tax  considerations  limit the amount of dividends
WFSB and WSL can pay.  The  principal  liquidity  needs of  Golden  West are for
payment of interest  and  principal on  subordinated  debt  securities,  capital
contributions to its insured  subsidiaries  (including $489 million for the year
ended  December  31,  1998 and $311  million  for the six months  ended June 30,
1998),  dividends  to  stockholders,  the  purchase  of Golden  West  stock (see
stockholders'  equity  section  on page  23),  and  general  and  administrative
expenses.  At June 30, 1999 and 1998, and December 31, 1998, Golden West's total
cash and investments  amounted to $725 million,  $750 million, and $898 million,
respectively.  Included in the June 30,  1999 and 1998,  and  December  31, 1998
amounts are loans to WFSB and WSL.

YEAR 2000

         The  Company is aware of the system  challenges  that the Year 2000 has
created and has implemented a plan (Year 2000 Project) to insure that all of the
Company's  mission  critical  systems are Year 2000  compliant by the end of the
second  quarter of 1999,  and to evaluate,  test,  and modify other systems that
might  also  be  affected.  The  evaluation,   correction  and  testing  of  the
mission-critical  systems was completed  during the first  quarter of 1999,  and
during  the  second  quarter  of  1999,  the  Company   successfully   completed
integration  testing to confirm that all such  systems  function  together.  All
mission critical systems have now been upgraded and placed into production.  The
Company has  completed  an inventory  and  assessment  of all other  non-mission
systems and is  currently  in the process of testing and  modifying or replacing
those systems that may be affected by Year 2000 compliance  issues.  The Company
expects to complete the testing and installation of non-mission critical systems
by the end of the third quarter of 1999.  The Year 2000 project was developed in
accordance with guidance set forth by federal banking  regulators in a series of
jointly-issued  policy statements.  Federal banking regulators regularly monitor
the Company's progress in meeting the requirements of such policy statements.

         While  the  Company  believes  it is doing  everything  technologically
possible to assure Year 2000 compliance, the success of the Year 2000 Project is
to some extent dependent upon vendor  cooperation.  The Company is requiring its
computer  systems and software  vendors to represent that the products  provided
are or will be Year 2000  compliant  and has  planned a program of  testing  for
compliance. Such testing is included in the testing previously described in this
section.  To date, the Company has no indication  that its principal  vendors or
their systems will adversely affect the Company's Year 2000 compliance efforts.



<PAGE>


     The Company currently estimates that it will cost approximately $19 million
to make all of its  computer  systems  Year 2000  compliant.  The  Company  will
expense all costs associated with the Year 2000 Project and expects to fund such
costs  through  operating  cash flows.  The Year 2000 Project  expense  incurred
during 1998 was $8 million and $6 million was  incurred for the six months ended
June 30, 1999.  Included in the $19 million are  estimates for  compensation  of
employees dedicated to the Year 2000 Project, consultants, hardware and software
expense and  depreciation  of the  equipment  purchased as part of this process.
However, the Company's Year 2000 expenses are not expected to result in a dollar
for dollar increase in the Company's overall  information  systems  expenditures
because the Company has dedicated a number of its existing  resources  solely to
the Year 2000 Project.

     The  Company  believes  that its  Year  2000  Project  will  result  in the
Company's  systems  functioning  normally  at the  beginning  of the year  2000,
without adverse consequences. While the systems of others, with whom and through
which the Company conducts business,  are not within the Company's control,  the
Year 2000  Project is intended to provide the Company  with  sufficient  advance
warning should such systems not perform. In the unlikely event of a problem with
the  Company's  systems or the systems of others which  relate to the  Company's
core  business,  the  Company  has  developed  contingency  plans to address the
potential that one or more systems might fail,  despite efforts to the contrary.
Although the Company has no reason to believe that such  contingency  plans will
not  effectively  avoid or  mitigate  any  adverse  consequences  of such system
failures, no assurances can be given that such plans will be effective.


ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Golden West estimates the sensitivity of the Company's net interest income,
net earnings, and capital ratios to interest rate changes and anticipated growth
based on simulations using an asset/liability model which takes into account the
lags  described on pages 11 and 27. The  simulation  model projects net interest
income,  net earnings,  and capital  ratios based on an immediate  interest rate
increase that is sustained for a thirty-six month period.  The model is based on
the actual maturity and repricing  characteristics  of  interest-rate  sensitive
assets and liabilities.  For certain assets, the model incorporates  assumptions
regarding the impact of changing  interest  rates on prepayment  rates which are
based on the Company's historical prepayment  information.  The model factors in
projections  for  anticipated  activity  levels by product  lines offered by the
Company.  Based on the  information  and assumptions in effect at June 30, 1999,
Management  believes  that a 200 basis  point  rate  increase  sustained  over a
thirty-six month period would not affect the Company's  long-term  profitability
and financial strength.



<PAGE>


PART II. OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)  Index to Exhibits

         Exhibit No. Description
         ----------- -----------
              3(a)  Certificate  of  Incorporation,  as amended,  and amendments
                    thereto,  are  incorporated  by reference to Exhibit 3(a) to
                    the Company's  Annual Report on Form 10-K (File No.  1-4269)
                    for the year ended December 31, 1990.

              3(b)  By-Laws  of  the   Company,   as   amended  in  1997,.   are
                    incorporated  by reference to Exhibit 3(a) to the  Company's
                    Annual  Report on Form 10-K (File No.  1-4269)  for the year
                    ended December 31, 1997.

              4(a)  The  Registrant  agrees to furnish to the  Commission,  upon
                    request, a copy of each instrument with respect to issues of
                    long-term  debt,  the authorized  principal  amount of which
                    does not exceed 10% of the total assets of the Company.

              10(a) 1996 Stock  Option  Plan,  as amended,  is  incorporated  by
                    reference  to Exhibit A of the  Company's  Definitive  Proxy
                    Statement on Schedule 14A,  filed on March 15, 1996, for the
                    Company's 1996 Annual Meeting of Stockholders.

              10(b) Annual  Incentive Bonus Plan is incorporated by reference to
                    Exhibit A of the  Company's  Definitive  Proxy  Statement on
                    Schedule  14A,  filed on March 14, 1998,  for the  Company's
                    1998 Annual Meeting of Stockholders.

              10(c) Deferred  Compensation  Agreement  between  the  Company and
                    James T. Judd is  incorporated by reference to Exhibit 10(b)
                    of the  Company's  Annual  Report  on Form  10-K  (File  No.
                    1-4629) for the year ended December 31, 1986.

              10(d) Deferred  Compensation  Agreement  between  the  Company and
                    Russell W. Kettell is  incorporated  by reference to Exhibit
                    10(c) of the Company's  Annual Report on Form 10-K (File No.
                    1-4629) for the year ended December 31, 1986.


<PAGE>


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K (Continued)

(a)  Index to Exhibits (continued)

          Exhibit No. Description
          ----------  -----------
              10(e) Deferred  Compensation  Agreement between the Company and J.
                    L. Helvey is  incorporated  by reference to Exhibit 10(d) of
                    the Company's  Annual Report on Form 10-K (File No.  1-4629)
                    for the year ended December 31, 1986.

              10(f) Form  of  Supplemental   Retirement  Agreement  between  the
                    Company and certain  executive  officers is  incorporated by
                    reference to Exhibit 10(j) to the Company's Annual Report on
                    Form 10-K (File No.  1-4629) for the year ended December 31,
                    1990.

              10(g) Operating  lease  on  Company  headquarters  building,  1901
                    Harrison Street, Oakland,  California 94612, is incorporated
                    by reference  to Exhibit  10(h) of the  Company's  Quarterly
                    Report on Form 10-Q (File No.  1-4629) for the quarter ended
                    September 30, 1998.

               11   Statement of Computation of Earnings Per Share

               27   Financial Data Schedule


(b)  Reports on Form 8-K

     The  Registrant  did not  file  any  current  reports  on Form 8-K with the
     Commission during the first six months of 1999.





<PAGE>

                                   SIGNATURES

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

                                        GOLDEN WEST FINANCIAL CORPORATION

Dated:  August 12, 1999                 /s/ J. L. Helvey
                                        ---------------------------------
                                        J. L. Helvey
                                        Executive Vice President
                                        (duly authorized and principal financial
                                        officer)