<PAGE>

                       Securities and Exchange Commission

                             Washington, D.C. 20549


                                    FORM 10-K

             [ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934
                   For the fiscal year ended December 31, 1997
                                       OR
            [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

      For the transition period from _________________ to ________________


                       Commission File number 33-19721-02


                          SWIFT ENERGY MANAGED PENSION
                         ASSETS PARTNERSHIP 1988-2, LTD.
                    (Exact name of registrant as specified in
                     its Certificate of Limited Partnership)

         TEXAS                                       76-0264870
(State of Organization)                (I.R.S. Employer Identification No.)


                         16825 Northchase Dr., Suite 400
                              Houston, Texas 77060
                                 (281) 874-2700
          (Address and telephone number of principal executive offices)


                 Securities registered pursuant to Section 12(b)
                                   of the Act:
                        18,562 Limited Partnership Units

                 Securities registered pursuant to Section 12(g)
                                   of the Act:
                        18,562 Limited Partnership Units


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

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]

Registrant does not have an aggregate  market value for its Limited  Partnership
Interests.

                       Documents Incorporated by Reference

Document                                          Incorporated as to

    Registration Statement No. 33-19721              Items 1 and 13
     on Form S-1



<PAGE>


                                TABLE OF CONTENTS

                             Form 10-K Annual Report
                     For the Period Ended December 31, 1997

                          SWIFT ENERGY MANAGED PENSION
                         ASSETS PARTNERSHIP 1988-2, LTD.


<TABLE>
<CAPTION>
ITEM NO.                           PART I                                  PAGE
  <S>          <C>                                                        <C>
   1           Business                                                     I-1
   2           Properties                                                   I-5
   3           Legal Proceedings                                            I-7
   4           Submission of Matters to a Vote of
                 Security Holders                                           I-7


                                   PART II

   5           Market Price of and Distributions on the
                 Registrant's Units and Related Limited
                 Partner Matters                                           II-1
   6           Selected Financial Data                                     II-2
   7           Management's Discussion and Analysis of
                 Financial Condition and Results of Operations             II-2
   8           Financial Statements and Supplementary Data                 II-3
   9           Disagreements on Accounting and Financial
                 Disclosure                                                II-3


                                   PART III

  10           Directors and Executive Officers of the
                 Registrant                                               III-1
  11           Executive Compensation                                     III-2
  12           Security Ownership of Certain Beneficial
                 Owners and Management                                    III-2
  13           Certain Relationships and Related Transactions             III-2


                                   PART IV

  14           Exhibits, Financial Statement Schedules
                 and Reports on Form 8-K                                   IV-1


                                   OTHER

               Signatures
</TABLE>


<PAGE>

          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.

                                     PART I

Item 1.  Business

General Description of Partnership

         Swift Energy Managed Pension Assets Partnership  1988-2,  Ltd., a Texas
limited  partnership (the "Partnership" or the  "Registrant"),  is a partnership
formed under a public serial  limited  partnership  offering  denominated  Swift
Energy Managed  Pension Assets Fund II  (Registration  Statement No. 33-19721 on
Form S-1, originally declared effective April 22, 1988 and amended effective May
3, 1988 [the  "Registration  Statement"]).  The Partnership was formed effective
January 31, 1989 under a Limited  Partnership  Agreement dated January 30, 1989.
The initial 180 limited partners made capital contributions of $1,856,200.

         The  Partnership  is  principally  engaged in the business of acquiring
nonoperating  interests  (i.e.,  net profits  interests,  royalty  interests and
overriding  royalty  interests)  in proven  oil and gas  properties  within  the
continental United States. The Partnership does not acquire working interests in
or operate oil and gas properties,  and does not engage in drilling  activities.
At December 31, 1997, the  Partnership  had expended or committed to expend 100%
of the limited partners' net commitments  (i.e.,  limited partners'  commitments
available  to  the  Partnership  for  property  acquisitions  after  payment  of
organizational  fees  and  expenses)  in  the  acquisition  and  development  of
nonoperating  interests in producing properties,  which properties are described
under Item 2,  "Properties"  below. The  Partnership's  income is derived almost
entirely from its nonoperating interests and the disposition thereof.

         The  Partnership's  business and affairs are  conducted by its Managing
General  Partner,  Swift Energy  Company,  a Texas  corporation  ("Swift").  The
Partnership's  Special General  Partner,  VJM Partners,  Ltd.  ("VJM"),  a Texas
limited  partnership,  consults with and advises  Swift as to certain  financial
matters.

         The  general  manner in which  the  Partnership  acquires  nonoperating
interests  and  otherwise  conducts  its  business is described in detail in the
Registration Statement under "Proposed Activities," which is incorporated herein
by reference.  The following is intended only as a summary of the  Partnership's
manner of doing business and specific activities to date.

Manner of  Acquiring  Nonoperating  Interests  in  Properties;  Net  Profits and
Overriding Royalty Interest Agreement

         The nonoperating  interests owned by the Registrant have typically been
acquired  pursuant to a Net Profits and Overriding  Royalty  Interest  Agreement
dated February 10, 1989 (the "NP/OR Agreement") between the Registrant and Swift
Energy Income Partners  1988-2,  Ltd. and Swift Energy Income  Partners  1988-3,
Ltd.  (the  "Operating  Partnerships").  The  Operating  Partnerships  are Texas
limited  partnerships  that are also  managed  by Swift and VJM.  The  Operating
Partnerships   were  formed  to  acquire  and  develop  producing  oil  and  gas
properties.

         Under  the  NP/OR   Agreement,   the   Registrant   and  the  Operating
Partnerships  have,  in  effect,  combined  their  funds  to  acquire  producing
properties.  Using  funds  committed  to the  NP/OR  Agreement  by  each  of the
partnerships,  the Operating  Partnerships  acquire producing  properties,  then
promptly convey nonoperating interests therein to the Registrant.  The Operating
Partnerships  retain  a  working  interest  in  each  such  property,   and  are
responsible  for the production of oil and gas therefrom.  For the sake of legal
and administrative  convenience,  producing properties are usually acquired from
the third party sellers by Swift,  which then convey a working  interest in each
such property to the Operating Partnerships.  The Registrant initially committed
$1,608,064 and the Operating  Partnerships  initially  committed  $1,000,000 and
$1,400,000,  respectively,  for  acquisitions  under  the NP/OR  Agreement.  The
Operating  Partnerships are obligated under the NP/OR Agreement to convey to the
Registrant  fixed  net  profits  interests  of 45% and  37%,  respectively,  and
variable  overriding  royalty  interests  in specified  depths of all  producing
properties acquired under the NP/OR Agreement.

         Under the NP/OR Agreement,  the Operating  Partnerships are required to
convey  to  the  Registrant,   and  the  Registrant  is  required  to  purchase,
nonoperating  interests in all  producing  properties  acquired by the Operating
Partnerships, except that:

                                       I-1

<PAGE>

          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.


                  1. properties  anticipated to require significant  development
operations and nonoperating  interests offered to the Operating  Partnerships by
third parties may be purchased by the Operating  Partnerships  outside the NP/OR
Agreement, without participation by the Registrant;

                  2. during a  specified  one-year  period,  the  Registrant  is
entitled to reduce the amount originally  committed by it to purchases under the
NP/OR  Agreement  and to redirect  such funds to the  purchase  of  nonoperating
interests from sources other than the Operating Partnerships; and

                  3. the  Registrant's  funds  will be  released  from the NP/OR
Agreement if they are not completely spent by the Operating  Partnerships within
a specified  period, or if there is a prior withdrawal of funds by the Operating
Partnerships  to  purchase   properties   anticipated  to  require   significant
development.

         Purchases of nonoperating  interests by the Registrant  using withdrawn
or  released  funds  may be made  from  the  Managing  General  Partner  and its
affiliates,  other  partnerships  affiliated  with  the  Operating  Partnerships
(possibly through the Registrant's  entry into a new NP/OR  Agreement),  or from
unaffiliated third parties.

         In accordance with its  obligations  under the NP/OR  Agreement,  as of
December 31, 1997 the Operating Partnerships have conveyed to the Registrant net
profits interests of 45% and 37%, respectively,  burdening certain depths of all
producing  properties  acquired  by  the  Operating   Partnerships   thereunder.
Typically,  a net profits interest in an oil and gas property entitles the owner
to a specified  percentage share of the gross proceeds generated by the burdened
property,  net of  operating  costs.  The net profits  interest  conveyed to the
Registrant  under the NP/OR  Agreement  differs  from the  typical  net  profits
interest in that it is calculated over the entire group of producing  properties
conveyed under the NP/OR  Agreement;  i.e., all operating costs  attributable to
the burdened  depths of such  properties are  aggregated,  and the total is then
subtracted  from the total of all gross proceeds  attributable to such depths in
order to calculate the net profits to which the Registrant is entitled.  The net
profits  interest  conveyed to the Registrant  burdens only those depths of each
subject  property which were evaluated to contain proved reserves at the date of
acquisition, to the extent such depths underlie specified surface acreage.

         The Operating  Partnerships  have also conveyed to the Registrant under
the NP/OR Agreement an overriding  royalty  interests in each property  acquired
thereunder. An overriding royalty interest is a fractional interest in the gross
production  (or the gross  proceeds  therefrom)  of oil and gas from a property,
free of any exploration,  development,  operation or maintenance expenses. Under
the NP/OR  Agreement,  the overriding  royalty  interest burdens the portions of
each producing  property that were  evaluated at the date of acquisition  not to
contain proved reserves.

Competition, Markets and Regulations

         Competition

         The oil and gas industry is highly  competitive in all its phases.  The
Partnership encounters strong competition from many other oil and gas producers,
many of which possess substantial financial resources, in acquiring economically
desirable Producing Properties.

         Markets

         The amounts of and price  obtainable  for oil and gas  production  from
Partnership  Properties will be affected by market factors beyond the control of
the  Partnership.  Such factors include the extent of domestic  production,  the
level of imports of foreign oil and gas, the general level of market demand on a
regional, national and worldwide basis, domestic and foreign economic conditions
that  determine  levels of industrial  production,  political  events in foreign
oil-producing  regions, and variations in governmental  regulations and tax laws
and  the  imposition  of new  governmental  requirements  upon  the  oil and gas
industry. There can be no assurance that oil and gas prices will not decrease in
the future, thereby decreasing net Revenues from Partnership Properties.

                                      I-2

<PAGE>

          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.


         From time to time,  there may exist a  surplus  of  natural  gas or oil
supplies,  the effect of which may be to reduce the amount of hydrocarbons  that
the  Partnerships may produce and sell while such oversupply  exists.  In recent
years,  initial steps have been taken to provide  additional gas  transportation
lines from Canada to the United States. If additional Canadian gas is brought to
the United States market, it could create downward pressure on United States gas
prices.

         Regulations

         Environmental Regulation

         The federal  government  and various state and local  governments  have
adopted  laws and  regulations  regarding  the control of  contamination  of the
environment.  These laws and regulations may require the acquisition of a permit
by Operators before drilling commences,  prohibit drilling activities on certain
lands  lying  within  wilderness  areas or where  pollution  arises  and  impose
substantial  liabilities for pollution  resulting from operations,  particularly
operations near or in onshore and offshore waters or on submerged  lands.  These
laws and  regulations  may also  increase  the  costs of  routine  drilling  and
operation of wells.  Because these laws and regulations change  frequently,  the
costs to the  Partnership of compliance  with existing and future  environmental
regulations cannot be predicted.  However, the Managing Partner does not believe
that the  Partnership is affected in a significantly  different  manner by these
regulations than are its competitors in the oil and gas industry.

         Federal Regulation of Natural Gas

         The  transportation  and sale of natural gas in interstate  commerce is
heavily  regulated  by  agencies  of  the  federal  government.   The  following
discussion is intended only as a summary of the principal statutes,  regulations
and  orders  that  may  affect  the  production  and  sale of  natural  gas from
Partnership  Properties.  This  summary  should not be relied upon as a complete
review of applicable natural gas regulatory provisions.

         FERC Orders

         Several major  regulatory  changes have been implemented by the Federal
Energy Regulatory  Commission  ("FERC") from 1985 to the present that affect the
economics of natural gas production,  transportation and sales. In addition, the
FERC  continues  to  promulgate  revisions  to various  aspects of the rules and
regulations  affecting  those  segments of the natural gas industry  that remain
subject to the FERC's jurisdiction. In April 1992, the FERC issued Order No. 636
pertaining to pipeline restructuring. This rule requires interstate pipelines to
unbundle  transportation  and sales services by separately  stating the price of
each service and by providing  customers  only the particular  service  desired,
without  regard to the source for  purchase of the gas.  The rule also  requires
pipelines to (i) provide  nondiscriminatory  "no-notice"  service  allowing firm
commitment  shippers to receive  delivery of gas on demand up to certain  limits
without  penalties,  (ii) establish a basis for release and reallocation of firm
upstream  pipeline  capacity  and  (iii)  provide  non-discriminatory  access to
capacity by firm  transportation  shippers on a  downstream  pipeline.  The rule
requires interstate  pipelines to use a straight fixed variable rate design. The
rule imposes these same requirements upon storage facilities.

         FERC Order No. 500  affects the  transportation  and  marketability  of
natural gas.  Traditionally,  natural gas has been sold by producers to pipeline
companies,  which then  resold the gas to  end-users.  FERC Order No. 500 alters
this market structure by requiring  interstate  pipelines that transport gas for
others to provide  transportation  service to  producers,  distributors  and all
other shippers of natural gas on a nondiscriminatory, "first-come, first-served"
basis ("open access  transportation"),  so that producers and other shippers can
sell natural gas directly to end-users.  FERC Order No. 500 contains  additional
provisions intended to promote greater competition in natural gas markets.

         It is not anticipated  that the  marketability  of and price obtainable
for natural gas production from  Partnership  Properties  will be  significantly
affected  by FERC  Order No.  500.  Gas  produced  from  Partnership  Properties
normally  will be sold to  intermediaries  who have entered into  transportation
arrangements with pipeline companies.  These  intermediaries will accumulate gas
purchased from a number of producers and sell the gas to end-users  through open
access pipeline transportation.

                                      I-3

<PAGE>


          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.


         State Regulations

         Production  of any oil  and gas  from  Partnership  Properties  will be
affected  to some  degree  by  state  regulations.  Many  states  in  which  the
Partnership will operate have statutory provisions regulating the production and
sale  of oil  and  gas,  including  provisions  regarding  deliverability.  Such
statutes, and the regulations promulgated in connection therewith, are generally
intended to prevent  waste of oil and gas and to protect  correlative  rights to
produce  oil and  gas  between  owners  of a  common  reservoir.  Certain  state
regulatory  authorities  also  regulate  the amount of oil and gas  produced  by
assigning allowable rates of production to each well or proration unit.

         Federal Leases

         Some of the Partnership's properties are located on federal oil and gas
leases  administered by various federal  agencies,  including the Bureau of Land
Management.   Various  regulations  and  orders  affect  the  terms  of  leases,
exploration and development plans, methods of operation and related matters.

         Employees

         The  Partnership  has no  employees.  Swift,  however,  has a staff  of
geologists,   geophysicists,   petroleum  engineers,   landmen,  and  accounting
personnel who  administer  the  operations of Swift and the  Partnership.  As of
December 31, 1997, Swift had 194 employees.  Swift's administrative and overhead
expenses  attributable  to  the  Partnership's   operations  are  borne  by  the
Partnership.


                                      I-4


<PAGE>


          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.


Item 2.  Nonoperating Interests in Properties

         As of December  31, 1997,  the  Partnership  has acquired  nonoperating
interests in producing  oil and gas  properties  which are  generally  described
below.

Principal Oil and Gas Producing Properties

         The most  valuable  fields  in the  Partnership,  based  upon  year-end
engineering  estimates of discounted  future net revenues using constant pricing
and costs, are described below.

         1.  Approximately  62% of the value is from the AWP  Field in  McMullen
County, Texas (Shell Oil Company acquisition). There are 69 producing wells from
the Olmos formation in this field.

         The remaining  value in the  Partnership  is  attributable  to numerous
properties  none of which equals or exceeds 15 percent of the total  Partnership
value.

Title to Properties

         Title to substantially  all significant  producing  properties in which
the Partnership owns  nonoperating  interests has been examined.  In addition to
the nonoperating interests owned by the Partnership,  the properties are subject
to royalty,  overriding  royalty and other interests  customary in the industry.
The Managing  General  Partner does not believe any of these burdens  materially
detract from the value of the  properties  or will  materially  detract from the
value of the properties or materially  interfere with their use in the operation
of the business of the Partnership.

Production and Sales Price

         The following  table  summarizes the volumes of the  Partnership's  net
nonoperating  interests in oil and gas production expressed in MCFs.  Equivalent
MCFs are obtained by converting oil to gas on the basis of their relative energy
content;  one barrel  equals 6,000 cubic feet of gas.  Average Net  Nonoperating
Interest  Price per Equivalent MCF is determined by dividing the related oil and
gas revenue from nonoperating interests by the equivalent MCF's.

<TABLE>
<CAPTION>
                                              Net Production
                                     -------------------------------
                                            For the Years Ended
                                               December 31,
                                     -------------------------------
                                      1997        1996        1995
                                     ------      ------      -------
<S>                                  <C>         <C>         <C>
Net Volumes (Equivalent MCFs)        56,875      81,561      102,252

Average Net Nonoperating
   Interest Price per
   Equivalent MCF                    $1.93       $2.20       $1.11
</TABLE>


                                      I-5


<PAGE>


          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.


Net Proved Oil and Gas Reserves

         Presented below are the estimates of the Partnership's  proved reserves
as of December 31, 1997,  1996 and 1995. The  Partnership  does not itself own a
direct  interest in proved  reserves.  The proved reserve  estimates shown below
represent an estimate of the proved reserves owned by the Operating  Partnership
equal to the percentage net profits interest  conveyed to the Partnership by the
Operating Partnership. All of the Partnership's nonoperating interests in proved
reserves are located in the United States.

<TABLE>
<CAPTION>
                                                                      December 31,
                                    ---------------------------------------------------------------
                                            1997                      1996                        1995
                                    --------------------      --------------------      --------------------
                                                Natural                   Natural                    Natural
                                      Oil         Gas           Oil         Gas          Oil          Gas
                                    -------     --------      -------     --------      -------      -------
                                     (BBLS)      (MMCF)        (BBLS)      (MMCF)        (BBLS)       (MMCF)
<S>                                  <C>             <C>       <C>             <C>       <C>             <C>
Proved developed
   reserves at end of year           18,159          300       23,431          380       36,296          521
                                     ------          ---       ------          ---       ------          ---
Proved reserves
   Balance at beginning
     of year                         29,095          454       41,611          600       59,481          635

   Extensions, discoveries
     and other additions                 --           --           --           --           --           --

   Revisions of previous
     estimates                       (2,413)         (47)      (4,187)          (3)      (8,763)          25

   Sales of minerals in
     place                               --           --       (3,164)         (92)      (2,154)          --

   Production                        (3,153)         (38)      (5,165)         (51)      (6,953)         (60)
                                     ------          ---       ------          ---       ------          ---

   Balance at end of year            23,529          369       29,095          454       41,611          600
                                     ------         ----       ------        -----      -------         ----
</TABLE>


         Revisions  of  previous  quantity  estimates  are  related to upward or
downward  variations  based on current  engineering  information  for production
rates,  volumetrics and reservoir  pressure.  Additionally,  changes in quantity
estimates  are the result of the  increase  or decrease in crude oil and natural
gas prices at each year end which have the effect of adding or  reducing  proved
reserves on marginal properties due to economic limitations.


                                      I-6


<PAGE>

          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.


         The following table summarizes by acquisition the  Registrant's  proved
reserves equal to the percentage net profits interests conveyed by the Operating
Partnership  and its  nonoperating  interests in gross and net producing oil and
gas wells as of December 31, 1997:

<TABLE>
<CAPTION>
                                                                 Reserves
                                                             December 31, 1997
                                                           ---------------------

                                                                   Natural              Wells
                                                          Oil        Gas         -----------------
Acquisition                State(s)                     (BBLS)     (MMCF)        Gross       Net
-----------                ---------                    ------     -------       -----     -------
<S>                        <C>                          <C>            <C>         <C>       <C>
Shell Oil Company          TX                           10,040         254          67       0.580
Union Pacific              AR, KS, NM,
                           OK, TX                       12,928          58         127       1.011
Allstate                   KS, LA, OK                      168          57         158       3.070
Maxus                      WY                              393          --          11       0.008
                                                        ------         ---        ----       -----

                                                        23,529         369         363       4.669
                                                        ------         ---        ----       -----
</TABLE>

         There are numerous  uncertainties  inherent in estimating quantities of
proved  reserves and in projecting  the future rates of  production,  timing and
plan of  development.  Oil and gas reserve  engineering  must be recognized as a
subjective process of estimating  underground  accumulations of oil and gas that
cannot be measured  in an exact way,  and  estimates  of other  engineers  might
differ  from  those  above,  audited  by H. J.  Gruy and  Associates,  Inc.,  an
independent petroleum consulting firm. The accuracy of any reserve estimate is a
function of the quality of  available  data and of  engineering  and  geological
interpretation  and  judgment.  Results  of  drilling,  testing  and  production
subsequent  to the date of the estimate may justify  revision of such  estimate,
and, as a general rule,  reserve  estimates based upon  volumetric  analysis are
inherently  less  reliable  than  those  based on  lengthy  production  history.
Accordingly,  reserve  estimates are often  different from the quantities of oil
and gas that are ultimately recovered.

         In estimating  the oil and natural gas  reserves,  the  Registrant,  in
accordance with criteria  prescribed by the Securities and Exchange  Commission,
has used prices received as of December 31, 1997 without  escalation,  except in
those instances where fixed and determinable  gas price  escalations are covered
by  contracts,  limited  to the  price the  Partnership  reasonably  expects  to
receive.  The  Registrant  does not believe that any  favorable or adverse event
causing a significant  change in the estimated  quantity of proved  reserves has
occurred between December 31, 1997 and the date of this report.

         Future prices received for the sale of the  Partnership's  products may
be higher or lower than the prices used in the evaluation  described  above; the
operating  costs relating to such  production may also increase or decrease from
existing  levels.  The estimates  presented  above are in accordance  with rules
adopted by the Securities and Exchange Commission.

Item 3. Legal Proceedings

         The Partnership is not aware of any material pending legal  proceedings
to which it is a party or of which any of its property is the subject.

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

         No matters  were  submitted  to a vote of limited  partners  during the
fourth quarter of the fiscal year.

                                      I-7

<PAGE>


          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.

                                     PART II


Item 5. Market Price of and Distributions on the Registrant's  Units and Related
Limited Partner Matters

Market Information

         Units in the  Partnership  were  initially  sold at a price of $100 per
Unit.  Units are not traded on any exchange and there is no  established  public
trading  market for the Units.  Swift is aware of negotiated  transfers of Units
between  unrelated  parties;  however,  these  transfers  have been  limited and
sporadic.  Due to the  nature of these  transactions,  Swift  has no  verifiable
information regarding prices at which Units have been transferred.

Holders

         As of December 31, 1997,  there were 180 Limited Partners holding Units
in the Partnership.

Distributions

         The Partnership  generally makes distributions to Limited Partners on a
quarterly  basis,   subject  to  the  restrictions  set  forth  in  the  Limited
Partnership  Agreement.  In the fiscal years ending  December 31, 1996 and 1997,
the Partnership  distributed a total of $97,400 and $102,200,  respectively,  to
holders of its Units.  Cash  distributions  constitute net proceeds from sale of
oil and gas  production  after  payment of lease  operating  expenses  and other
partnership expenses.  Some or all of such amounts or any proceeds from the sale
of partnership  properties  could be deemed to constitute a return of investors'
capital.

         Oil and gas  investments  involve a high risk of loss, and no assurance
can be given that any particular  level of distributions to holders of Units can
be  achieved  or  maintained.   Although  it  is   anticipated   that  quarterly
distributions  will continue to be made through 1998, the Partnership's  ability
to make distributions  could be diminished by any event adversely  affecting the
oil and gas properties in which the Partnership  owns interests or the amount of
revenues received by the Partnership therefrom.

         The  Partnership's   Limited  Partnership  Agreement  contains  various
provisions  which might serve to delay,  defer or prevent a change in control of
the Partnership,  such as the requirement of a vote of Limited Partners in order
to  sell  all  or  substantially  all  of the  Partnership's  properties  or the
requirement of consent by the Managing  General  Partner to transfers of limited
partnership interests.


                                      II-1


<PAGE>

          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.

Item 6. Selected Financial Data

         The following  selected  financial  data,  prepared in accordance  with
generally  accepted  accounting  principles as of December 31, 1997, 1996, 1995,
1994 and  1993,  should be read in  conjunction  with the  financial  statements
included in Item 8:

<TABLE>
<CAPTION>
                                  1997               1996               1995              1994             1993
                              ------------       ------------       ------------      ------------     ------------
<S>                        <C>                <C>                <C>               <C>               <C>
Revenues                   $     120,190      $     191,752      $      117,958    $     170,063     $     217,498
Income (Loss)              $      39,784      $      91,433      $       12,160    $    (179,067)    $      62,252
Total Assets               $     551,123      $     628,217      $      645,854    $     706,279     $   1,022,374
Cash Distributions         $     115,127      $     111,147      $       73,023    $     136,367     $     335,715
Long Term Obligations      $          --      $          --      $           --    $          --     $          --
Limited Partners' Net
  Income (Loss)Per Unit    $        1.99      $        4.52      $          .58    $      (12.47)    $        2.50 
Limited Partners' 
  Cash Distribution 
  Per Unit                 $        5.51      $        5.25      $         3.48    $        6.58     $       16.50
</TABLE>

Item 7. Management's  Discussion and Analysis of Financial Condition and Results
of
         Operations

Liquidity and Capital Resources

         Oil  and  gas  reserves  are  depleting   assets  and  therefore  often
experience   significant   production  declines  each  year  from  the  date  of
acquisition  through the end of the life of the property.  The primary source of
liquidity to the  Partnership  comes almost  entirely from the income  generated
from the sale of oil and gas produced  from  ownership  interests in oil and gas
properties. Net cash provided by operating activities totaled $105,997, $146,801
and $77,323 in 1997, 1996 and 1995,  respectively.  This source of liquidity and
the related results of operations, and in turn cash distributions,  will decline
in future periods as the oil and gas produced from the properties  also declines
while production and general and  administrative  costs remain relatively stable
making it unlikely that the Partnership  will hold the properties until they are
fully  depleted,  but will likely  liquidate when a substantial  majority of the
reserves have been produced.  The  Partnership has expended all of the partner's
net commitments available for property acquisitions and development by acquiring
producing oil and gas properties.  The partnership  invests  primarily in proved
producing  properties  with nominal  levels of future costs of  development  for
proven but undeveloped reserves. Significant purchases of additional reserves or
extensive drilling activity are not anticipated.  Capital  expenditures in 1997,
1996  and  1995  totaled  $8,714,  $12,468  and  $34,176,   respectively.   Cash
distributions to partners totaled  $115,127,  $111,147 and $73,023 in 1997, 1996
and 1995, respectively.

Results of Operations

         Income from  nonoperating  interests  decreased 39 percent in 1997 over
1996.  Oil and gas sales  decreased  30  percent  in 1997 vs.  1996.  Production
volumes  decreased 30 percent due to a 25 percent gas production  decrease and a
39 percent oil production  decline.  The decrease in production,  due in part to
accelerated  production  declines on mature wells,  had a significant  impact on
partnership performance.  The partnership's sale of several low value properties
in 1996 and 1997 also had an impact on 1997 partnership  performance.  A decline
in the 1997 oil  prices of 8 percent or  $1.48/BBL  further  contributed  to the
partnership's  decreased  revenues.  An  increase  in the 1997 gas  prices  of 6
percent or $.18/MCF partially offset the production declines.

         Two  components,  the  normal  provision,  calculated  on the  units of
production  method,  and  the  additional  provision,  relating  to the  ceiling
limitation,  make up total  amortization  expense.  Total  amortization  expense
decreased  22 percent in 1997 when  compared  to 1996,  primarily  due to the 30
percent production volume decrease. No additional provision for amortization was
recorded in 1997 or 1996.

                                      II-2

<PAGE>

          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.


         Income from  nonoperating  interests  increased 61 percent in 1996 over
1995. Oil and gas sales increased 16 percent in 1996 vs. 1995. Increases in both
1996 gas and oil prices were major contributors to the increased  revenues.  The
Partnership experienced an increase in gas prices of 56 percent or $1.01/MCF and
an  increase  in oil  prices of 26  percent  or  $3.93/BBL.  Production  volumes
decreased  20  percent  due to a 26 percent  oil  production  decrease  and a 17
percent gas production  decline.  The production  declines  partially offset the
effect of increased oil and gas prices impacting partnership performance.

         Total  amortization  expense for 1996  decreased  14 percent or $10,792
when  compared to 1995.  Normal  amortization  expense  decreased  20 percent or
$10,705 in 1996 when  compared to 1995,  relating to the 11 percent  decrease in
production volumes.

         The  Partnership  recorded an additional  provision in  amortization in
1995 of $87, when the present  value,  discounted  at ten percent,  of estimated
future net revenues  from oil and gas  properties,  using the  guidelines of the
Securities and Exchange Commission,  was below the fair market value for oil and
gas properties resulting in a full cost ceiling impairment.

         During 1998,  Partnership revenues and costs will be shared between the
limited and general  partners in a 90:10 ratio,  based on the annualized rate of
cash  distributions by the Partnership during a certain period prior to December
31,  1997.  Based on current oil and gas prices,  current  levels of oil and gas
production and expected cash  distributions  during 1998,  the Managing  General
Partner  anticipates  that the  Partnership  sharing  ratio will  continue to be
90:10.

Item 8. Financial Statements and Supplementary Data

         See Part IV, Item 14(a) for index to financial statements.

Item 9. Disagreements on Accounting and Financial Disclosure

         None.


                                      II-3


<PAGE>


          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.

                                    PART III


Item 10.  Directors and Executive Officers of the Registrant

         As a limited partnership,  the Registrant has no directors or executive
officers.  The  business and affairs of the  Registrant  are managed by Swift as
Managing General Partner.  Set forth below is certain information as of February
18, 1998 regarding the directors and executive officers of Swift.

<TABLE>
<CAPTION>
                                             Position(s) with
         Name             Age            Swift and Other Companies
         ----             ---            -------------------------
<S>                       <C>       <C>
                                    DIRECTORS

A. Earl Swift             64        Chief Executive Officer and
                                    Chairman of the Board

Virgil N. Swift           69        Executive Vice President - Business
                                    Development, Vice Chairman of the Board

G. Robert Evans           66        Director of Swift; Chairman of the Board,
                                    Material Sciences Corporation;
                                    Director, Consolidated Freightways, Inc.,
                                    Fibreboard  Corporation,   Elco  Industries,
                                    and Old Second Bancorp

Raymond O. Loen           73        Director of Swift; President, R. O. Loen
                                    Company

Henry C. Montgomery       62        Director of Swift; Chairman of the Board,
                                    Montgomery Financial Services Corporation;
                                    Director, Southwall Technology Corporation

Clyde W. Smith, Jr.       49        Director of Swift; President, Somerset
                                    Properties, Inc.

Harold J. Withrow         70        Director of Swift

                                    EXECUTIVE OFFICERS

Terry E. Swift            42        President, Chief Operating Officer

John R. Alden             52        Senior Vice President - Finance,
                                    Chief Financial Officer and Secretary

Bruce H. Vincent          50        Senior Vice President - Funds Management

James M. Kitterman        53        Senior Vice President - Operations

Joe A. D'Amico            49        Senior Vice President- Exploration and
                                    Development

Alton D. Heckaman, Jr.    40        Vice President - Finance and
                                    Controller
</TABLE>


                                     III-1


<PAGE>


          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.


         From time to time, Swift as Managing General Partner of the Partnership
purchases Units in the  Partnership  from investors who offer the Units pursuant
to their right of  presentment,  which  purchases are made pursuant to terms set
out in the  Partnership's  original Limited  Partnership  Agreement.  Due to the
frequency  and  large  number  of  these   transactions,   Swift  reports  these
transactions  under  Section  16 of the  Securities  Exchange  Act of 1934 on an
annual  rather than a monthly  basis.  In some cases such annual  reporting  may
constitute a late filing of the required Section 16 reports under the applicable
Section 16 rules.

Item 11.  Executive Compensation

         As  noted  in  Item  10,  "Directors  and  Executive  Officers  of  the
Registrant,"  above,  the Partnership has no executive  officers.  The executive
officers of Swift and VJM are not compensated by the Partnership.

         Certain fees and  allowances  contemplated  by the Limited  Partnership
Agreement  have been paid by the  Partnership  to Swift and VJM. See Note (4) in
Notes  To  Financial   Statements   (Related-Party   Transactions)  for  further
discussion.

Item 12.  Security Ownership of Certain Beneficial Owners and Management

         No  single  limited  partner  is  known  to the  Partnership  to be the
beneficial owner of more than five percent of the Partnership's Units.

         Swift and VJM are not aware of any arrangement,  the operation of which
may at a subsequent date result in a change in control of the Partnership.

Item 13.  Certain Relationships and Related Transactions

         As  noted  in  Item  10,  "Directors  and  Executive  Officers  of  the
Registrant," above, the Partnership has no executive officers or directors,  and
thus has not  engaged  in any  transactions  in which  any  such  person  had an
interest.  The Partnership is permitted to engage in certain  transactions  with
Swift as Managing General Partner and VJM as Special General Partner, subject to
extensive  guidelines  and  restrictions  as  described  in  the  "Conflicts  of
Interest"  section  of the  Amended  Prospectus  contained  in the  Registration
Statement, which is incorporated herein by reference.

         Summarized  below are the  principal  transactions  that have  occurred
between the Partnership,  on one hand, and Swift, VJM and their  affiliates,  on
the other.

Certain Transactions with General Partners

         1.  As  described  in  Item  1,  "Business,"  above,  during  1989  the
Partnership  entered into an NP/OR  Agreement  with the  Operating  Partnership,
which is also managed by Swift and VJM.  Pursuant to such NP/OR  Agreement,  the
Operating Partnership acquired the oil and gas properties described under Item 2
above and conveyed nonoperating interests therein to the Partnership.

         2.  Swift  acts  as  operator  for  many  of the  wells  in  which  the
Partnership has  nonoperating  interests and has received  compensation for such
activities in accordance with standard industry operating agreements.

         3. The  Partnership  paid to Swift and VJM certain fees as contemplated
by the  Limited  Partnership  Agreement.  See Note  (4) in  Notes  To  Financial
Statements (Related-Party Transactions) for further discussion.


                                     III-2


<PAGE>


          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.

                                     PART IV

<TABLE>
<CAPTION>
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K

      a(1)     FINANCIAL STATEMENTS                                   PAGE NO.
                                                                      --------
               <S>                                                      <C>
               Report of Independent Public Accountants                 IV-3

               Balance Sheets as of December 31, 1997 and 1996          IV-4

               Statements of Operations for the years ended
                  December 31, 1997, 1996 and 1995                      IV-5

               Statements of Partners' Capital for the years ended
                  December 31, 1997, 1996 and 1995                      IV-6

               Statements of Cash Flows for the years ended
                  December 31, 1997, 1996 and 1995                      IV-7

               Notes to Financial Statements                            IV-8
</TABLE>

       a(2)    FINANCIAL STATEMENT SCHEDULES

               All schedules required by the SEC are either  inapplicable or the
               required information is included in the Financial Statements, the
               Notes thereto, or in other information included elsewhere in this
               report.

       a(3)    EXHIBITS

             3.1      Limited  Partnership  Agreement  of Swift  Energy  Managed
                      Pension Assets Partnership 1988-2, Ltd., dated January 30,
                      1989. (Form 10-K for year ended December 31, 1989, Exhibit
                      3.1).

             3.2      Certificate of Limited Partnership of Swift Energy Managed
                      Pension Assets Partnership 1988-2,  Ltd., as filed January
                      30, 1989,  with the Texas  Secretary of State.  (Form 10-K
                      for year ended December 31, 1989, Exhibit 3.2).

             10.1     Net  Profits and  Overriding  Royalty  Interest  Agreement
                      between Swift Energy Managed  Pension  Assets  Partnership
                      1988-2, Ltd. and Swift Energy Income Partners 1988-2, Ltd.
                      dated  February  10,  1989.  (Form  10-K  for  year  ended
                      December 31, 1989, Exhibit 10.1).

             99.1     A copy of the following  section of the  Prospectus  dated
                      April 22, 1988, contained in Pre-Effective Amendment No. 1
                      to  Registration  Statement  No.  33-19721 on Form S-1 for
                      Swift Energy  Managed  Pension Assets  Partnership  II, as
                      filed on April 21,  1988,  which  have  been  incorporated
                      herein by reference:  "Proposed  Activities"  (pp 38 - 48)
                      and  "Conflicts of Interest" (pp 65 - 73).  (Form 10-K for
                      year ended December 31, 1989, Exhibit 28.1).

       b(1)    REPORTS ON FORM 8-K

               No reports on Form 8-K have been filed  during the quarter  ended
December 31, 1997.

                                      IV-1


<PAGE>


          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.


Supplemental  Information to be Furnished with Reports Filed Pursuant to Section
15(d) of the Act by Registrants Which Have Not Registered Securities Pursuant to
Section 12 of the Act.

         No annual report to security  holders covering the  Partnership's  1997
fiscal  year,  or proxy  statement,  form of proxy  or  other  proxy  soliciting
material has been sent to Limited Partners of the Partnership.


                                      IV-2


<PAGE>


                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To Swift Energy Managed Pension Assets Partnership 1988-2, Ltd.:

         We have audited the accompanying balance sheets of Swift Energy Managed
Pension Assets  Partnership  1988-2,  Ltd., (a Texas limited  partnership) as of
December 31, 1997 and 1996, and the related statements of operations,  partners'
capital and cash flows for the years ended  December  31,  1997,  1996 and 1995.
These  financial  statements  are the  responsibility  of the  Managing  General
Partner's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audits.

         We conducted our audits in accordance with generally  accepted auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

         In our opinion,  the  financial  statements  referred to above  present
fairly, in all material respects, the financial position of Swift Energy Managed
Pension Assets Partnership  1988-2,  Ltd., as of December 31, 1997 and 1996, and
the results of its  operations  and its cash flows for the years ended  December
31, 1997,  1996 and 1995,  in  conformity  with  generally  accepted  accounting
principles.






                                                ARTHUR ANDERSEN LLP




Houston, Texas
February 10, 1998


                                      IV-3


<PAGE>


                          SWIFT ENERGY MANAGED PENSION
                         ASSETS PARTNERSHIP 1988-2, LTD.
                                 BALANCE SHEETS
                           DECEMBER 31, 1997 AND 1996


<TABLE>
<CAPTION>
                                                                                            1997                 1996
                                                                                       ---------------     ----------------
         <S>                                                                           <C>                  <C>           
         ASSETS:

         Current Assets:
              Cash and cash equivalents                                                $      110,632       $      124,601
              Nonoperating interests income receivable                                         33,979               51,585
                                                                                       ---------------     ----------------
                   Total Current Assets                                                       144,611              176,186
                                                                                       ---------------     ----------------
         Nonoperating interests in oil and gas
              properties, using full cost accounting                                        1,606,462            1,601,623
         Less-Accumulated amortization                                                     (1,199,950)          (1,149,592)
                                                                                       ---------------     ----------------
                                                                                              406,512              452,031
                                                                                       ---------------     ----------------
                                                                                       $      551,123       $      628,217
                                                                                       ===============     ================


         LIABILITIES AND PARTNERS' CAPITAL:

         Current Liabilities:
              Accounts Payable                                                         $        3,553       $        5,304
                                                                                       ---------------     ----------------

         Limited Partners' Capital (18,562 Limited Partnership Units;
                                    $100 per unit)                                            547,558              618,145
         General Partners' Capital                                                                 12                4,768
                                                                                       --------------       --------------
                   Total Partners' Capital                                                    547,570              622,913
                                                                                       ---------------     ----------------
                                                                                       $      551,123       $      628,217
                                                                                       ===============     ================
</TABLE>


                 See accompanying notes to financial statements.

                                      IV-4


<PAGE>


                          SWIFT ENERGY MANAGED PENSION
                         ASSETS PARTNERSHIP 1988-2, LTD.
                            STATEMENTS OF OPERATIONS
              FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995






<TABLE>
<CAPTION>
                                                                      1997             1996              1995
                                                                ---------------  ---------------   ---------------
<S>                                                             <C>              <C>               <C>            
REVENUES:
   Income from nonoperating interests                           $       114,833  $       188,549   $       117,286
   Interest income                                                        5,357            3,203               672
                                                                ---------------  ---------------   ---------------
                                                                        120,190          191,752           117,958
                                                                ---------------  ---------------   ---------------

COSTS AND EXPENSES:
   Amortization -
         Normal provision                                                50,358           64,412            75,117
         Additional provision                                                --               --                87
   General and administrative                                            30,048           35,907            30,594
                                                                ---------------  ---------------   ---------------
                                                                         80,406          100,319           105,798
                                                                ---------------  ---------------   ---------------
INCOME (LOSS)                                                   $        39,784  $        91,433   $        12,160
                                                                ===============  ===============   ===============
</TABLE>


                 See accompanying notes to financial statements.

                                      IV-5


<PAGE>


                          SWIFT ENERGY MANAGED PENSION
                         ASSETS PARTNERSHIP 1988-2, LTD.
                         STATEMENTS OF PARTNERS' CAPITAL
              FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995


<TABLE>
<CAPTION>
                                                  Limited          General          Combining
                                                  Partners         Partners         Adjustment           Total
                                              ---------------   ---------------  ---------------    ---------------
<S>                                           <C>               <C>              <C>                 <C>           
Balance,
    December 31, 1994                         $       653,287   $         8,830  $        41,373     $      703,490

Income (Loss)                                          10,736             5,685           (4,261)            12,160

Cash Distributions                                    (64,600)           (8,423)              --            (73,023)
                                              ---------------   ---------------  ---------------    ---------------
Balance,
    December 31, 1995                                 599,423             6,092           37,112            642,627
                                              ---------------   ---------------  ---------------    ---------------

Income (Loss)                                          83,816            12,423           (4,806)            91,433

Cash Distributions                                    (97,400)          (13,747)              --           (111,147)
                                              ---------------   ---------------  ---------------    ---------------
Balance,
    December 31, 1996                                 585,839             4,768           32,306            622,913
                                              ---------------   ---------------  ---------------    ---------------

Income (Loss)                                          36,877             8,171           (5,264)            39,784

Cash Distributions                                   (102,200)          (12,927)              --           (115,127)
                                              ---------------   ---------------  ---------------    ---------------
Balance,
    December 31, 1997                         $       520,516   $            12  $        27,042     $      547,570
                                              ===============   ===============  ===============    ===============



Limited Partners' net income (loss)
    per unit

      1995                                    $           .58
                                              ===============
      1996                                    $          4.52
                                              ===============
      1997                                    $          1.99
                                              ===============
</TABLE>


                 See accompanying notes to financial statements.

                                      IV-6


<PAGE>


                          SWIFT ENERGY MANAGED PENSION
                         ASSETS PARTNERSHIP 1988-2, LTD.
                            STATEMENTS OF CASH FLOWS
              FOR THE YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

<TABLE>
<CAPTION>
                                                                                       1997             1996              1995
                                                                                 ---------------   ---------------  ---------------
<S>                                                                              <C>               <C>              <C>            
CASH FLOWS FROM OPERATING ACTIVITIES:
    Income (Loss)                                                                $        39,784   $        91,433  $        12,160
    Adjustments to reconcile income (loss) to
      net cash provided by operations:
      Amortization                                                                        50,358            64,412           75,204
      Change in assets and liabilities:
        (Increase) decrease in nonoperating interests income receivable                   17,606           (11,121)         (10,479)
        Increase (decrease) in accounts payable                                           (1,751)            2,077             (438)
                                                                                 ---------------   ---------------  ---------------
                  Net cash provided by (used in) operating activities                    105,997           146,801           77,323
                                                                                 ---------------   ---------------  ---------------
CASH FLOWS FROM INVESTING ACTIVITIES:
    Additions to nonoperating interests in oil and gas properties                         (8,714)          (12,468)         (34,176)
    Proceeds from sales of nonoperating interests in oil and gas properties                3,875            83,843           46,342
                                                                                 ---------------   ---------------  ---------------
                  Net cash provided by (used in) investing activities                     (4,839)           71,375           12,166
                                                                                 ---------------   ---------------  ---------------
CASH FLOWS FROM FINANCING ACTIVITIES:
    Cash distributions to partners                                                      (115,127)         (111,147)         (73,023)
                                                                                 ---------------   ---------------  ---------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                     (13,969)          107,029           16,466
                                                                                 ---------------   ---------------  ---------------
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR                                           124,601            17,572            1,106
                                                                                 ---------------   ---------------  ---------------
CASH AND CASH EQUIVALENTS AT END OF YEAR                                         $       110,632   $       124,601  $        17,572
                                                                                 ===============   ===============  ===============
</TABLE>


                 See accompanying notes to financial statements.

                                      IV-7


<PAGE>

          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.
                          NOTES TO FINANCIAL STATEMENTS


(1) Organization and Terms of Partnership Agreement -

         Swift Energy Managed Pension Assets Partnership  1988-2,  Ltd., a Texas
limited partnership ("the Partnership"), was formed on January 31, 1989, for the
purpose of purchasing net profits  interests,  overriding  royalty interests and
royalty interests (collectively,  "nonoperating interests") in producing oil and
gas  properties  within the  continental  United  States.  Swift Energy  Company
("Swift"), a Texas corporation,  and VJM Partners, Ltd. ("VJM"), a Texas limited
partnership,  serve as Managing  General  Partner and Special General Partner of
the  Partnership,  respectively.  The  Managing  General  Partner is required to
contribute up to 1/99th of limited  partner net  contributions.  The 180 limited
partners made total capital contributions of $1,856,200.

         Nonoperating  interests  acquisition  costs and the  management fee are
borne 99 percent by the limited partners and one percent by the Managing General
Partner.  Organization  and  syndication  costs were borne solely by the limited
partners.

         Initially,  all continuing costs (including  general and administrative
reimbursements and direct expenses) and revenues are allocated 90 percent to the
limited  partners  and  ten  percent  to  the  general  partners.  If  prior  to
partnership  payout,  as  defined,  however,  the cash  distribution  rate for a
certain period equals or exceeds 17.5 percent,  then for the following  calendar
year,  these  continuing  costs and revenues will be allocated 85 percent to the
limited  partners  and 15 percent to the  general  partners.  After  partnership
payout,  continuing  costs and revenues will be shared 85 percent by the limited
partners, and 15 percent by the general partners,  even if the cash distribution
rate is less than 17.5 percent. Payout had not occurred as of December 31, 1997.

(2) Significant Accounting Policies -

Use of Estimates --

         The  preparation of financial  statements in conformity  with generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that affect the reported  amounts of assets and  liabilities at the
date of the  financial  statements  and the  reported  amounts of  revenues  and
expenses  during  the  reporting  period.   Actual  results  could  differ  from
estimates.  Certain  reclassifications  have been made to prior year  amounts to
conform to the current year presentation.

Nonoperating Interests in Oil and Gas Properties --

         The  Partnership  accounts  for its  ownership  interest in oil and gas
properties   using  the   proportionate   consolidation   method,   whereby  the
Partnership's share of assets, liabilities, revenues and expenses is included in
the appropriate classification in the financial statements.

         For  financial   reporting   purposes,   the  Partnership  follows  the
"full-cost"  method of  accounting  for  nonoperating  interests  in oil and gas
properties.  Under  this  method  of  accounting,  all  costs  incurred  in  the
acquisition of nonoperating interests in oil and gas properties are capitalized.
The  unamortized  cost of  nonoperating  interests in oil and gas  properties is
limited to the "ceiling limitation", (calculated separately for the Partnership,
limited partners, and general partners).  The "ceiling limitation" is calculated
on a quarterly  basis and  represents  the  estimated  future net revenues  from
nonoperating interests in proved properties using current prices,  discounted at
ten percent.  Proceeds from the sale or disposition of nonoperating interests in
oil  and  gas  properties  are  treated  as a  reduction  of  the  cost  of  the
nonoperating  interests with no gains or losses recognized except in significant
transactions.

                                      IV-8

<PAGE>

          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


         The Partnership computes the provision for amortization of nonoperating
interests in oil and gas  properties on the  units-of-production  method.  Under
this method,  the provision is calculated by multiplying  the total  unamortized
cost of  nonoperating  interests  in oil and gas  properties  by an overall rate
determined  by dividing  the physical  units of oil and gas produced  during the
period by the total estimated units of proved oil and gas reserves  attributable
to the Partnership's nonoperating interests at the beginning of the period.

         The  calculation  of the "ceiling  limitation"  and the  provision  for
amortization  is based on  estimates  of proved  reserves.  There  are  numerous
uncertainties  inherent  in  estimating  quantities  of proved  reserves  and in
projecting the future rates of production,  timing and plan of development.  The
accuracy of any reserve  estimate is a function of the quality of available data
and of  engineering  and  geological  interpretation  and  judgment.  Results of
drilling,  testing and  production  subsequent  to the date of the  estimate may
justify  revision of such  estimate.  Accordingly,  reserve  estimates are often
different from the quantities of oil and gas that are ultimately recovered.

Cash and Cash Equivalents --

         Highly liquid debt instruments with an initial maturity of three months
or less are considered to be cash equivalents.

Reclassifications --

         Certain  reclassifications have been made to the prior year balances to
conform with the current year presentation.

(3) Acquisition of Nonoperating Interests in Oil and Gas Property Costs -

         Effective February 10, 1989, the Partnership entered into a Net Profits
and Overriding Royalty Interests Agreement ("NP/OR Agreement") with Swift Energy
Income Partners 1988-2, Ltd.  ("Operating  Partnership"),  managed by Swift, for
the purpose of acquiring  interests in producing oil and gas  properties.  Under
the  terms  of  the  NP/OR  Agreement,  the  Partnership  has  been  conveyed  a
nonoperating  interest in the aggregate net profits (i.e., oil and gas sales net
of  related   operating   costs)  of  the  properties   acquired  equal  to  its
proportionate  share of the  property  acquisition  costs as  defined.  Property
acquisition costs are amounts actually paid by the Operating Partnership for the
properties  plus costs  incurred by the Operating  Partnership  in acquiring the
properties  and costs  related to screening and  evaluation  of  properties  not
acquired.  In  1997,  1996  and  1995,  the  Partnership  acquired  nonoperating
interests in producing oil and gas properties for j$8,714,  $12,468 and $34,176,
respectively.

         During 1995, the  Partnership's  unamortized oil and gas property costs
exceeded the quarterly  calculations of the "ceiling limitation" resulting in an
additional provision for amortization of $87.

(4) Related-Party Transactions -

         An  affiliate  of the  Special  General  Partner,  as  Dealer  Manager,
received $45,155 for managing and overseeing the offering of limited partnership
units.

                                      IV-9

<PAGE>


          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.
                    NOTES TO FINANCIAL STATEMENTS (CONTINUED)


         A  one-time  management  fee of  $46,405  was paid to Swift in 1989 for
services  performed  for the  Partnership.  During  1997,  1996  and  1995,  the
Partnership paid Swift $22,345,  $27,843 and $22,231,  respectively,  as general
and administrative overhead allowances.

(5) Federal Income Taxes -

         The Partnership is not a tax-paying entity. No provision is made in the
accounts of the Partnership for federal or state income taxes,  since such taxes
are liabilities of the individual partners,  and the amounts thereof depend upon
their respective tax situations.

         The tax returns and the amount of distributable  Partnership income are
subject to  examination  by the federal  and state  taxing  authorities.  If the
Partnership's  royalty  income for federal  income tax  purposes  is  ultimately
changed by the taxing  authorities,  the tax  liability of the limited  partners
could be changed  accordingly.  Royalty  income  reported  on the  Partnership's
federal  return of income for the years ended  December 31, 1997,  1996 and 1995
was $85,181, $189,788 and $46,949,  respectively. The difference between royalty
income for federal income tax purposes reported by the Partnership and income or
loss from  nonoperating  interests  reported herein  primarily  results from the
exclusion of amortization  (as described below) from ordinary income reported in
the Partnership's federal return of income.

         For federal income tax purposes,  amortization  with respect to oil and
gas is computed separately by the partners and not by the Partnership. Since the
amount of amortization  on  nonoperating  interests in oil and gas properties is
not  computed at the  Partnership  level,  amortization  is not  included in the
Partnership's  income for federal income tax purposes but is charged directly to
the  partners'  capital  accounts to the extent of the cost of the  nonoperating
interests in oil and gas  properties,  and thus is treated as a separate item on
the partners'  Schedule K-1.  Amortization  for federal  income tax purposes may
vary from that  computed  for  financial  reporting  purposes  in cases  where a
ceiling  adjustment  is  recorded,  as such  amount  is not  recognized  for tax
purposes.

(6) Vulnerability Due to Certain Concentrations -

         The Partnership's revenues are primarily the result of sales of its oil
and natural gas  production.  Market prices of oil and natural gas may fluctuate
and adversely affect operating results.

         In the normal  course of  business,  the  Partnership  extends  credit,
primarily  in the form of  monthly  oil and gas sales  receivables,  to  various
companies in the oil and gas industry which results in a concentration of credit
risk. This  concentration  of credit risk may be affected by changes in economic
or other conditions and may accordingly impact the Partnership's  overall credit
risk. However,  the Managing General Partner believes that the risk is mitigated
by the size,  reputation,  and nature of the companies to which the  Partnership
extends  credit.  In  addition,  the  Partnership  generally  does  not  require
collateral or other security to support customer receivables.

(7) Fair Value of Financial Instruments -

         The  Partnership's  financial  instruments  consist  of cash  and  cash
equivalents  and  short-term  receivables  and  payables.  The carrying  amounts
approximate  fair  value  due to the  highly  liquid  nature  of the  short-term
instruments.

                                      IV-10

<PAGE>



           SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD

                                   SIGNATURES



Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  Registrant  has duly  caused  this report to be signed on its
behalf by the undersigned thereunto duly authorized.



                                             SWIFT ENERGY MANAGED PENSION
                                             ASSETS PARTNERSHIP 1988-2, LTD.
                                             (Registrant)

                                    By:      SWIFT ENERGY COMPANY
                                              General Partner

Date:      February 18, 1998                 By:      s/b A. Earl Swift
           -----------------                 -----------------------------------
                                             A. Earl Swift
                                             Chief Executive Officer

Date:      February 18, 1998                 By:      s/b John R. Alden
           -----------------                 -----------------------------------
                                             John R. Alden
                                             Principal Financial Officer

Date:      February 18, 1998                 By:      s/b Alton D. Heckaman, Jr.
           -----------------                 -----------------------------------
                                             Alton D. Heckaman, Jr.
                                             Principal Accounting Officer

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

                                             SWIFT ENERGY MANAGED PENSION
                                             ASSETS PARTNERSHIP 1988-2, LTD.
                                             (Registrant)

                                    By:      SWIFT ENERGY COMPANY
                                              General Partner

Date:     February 18, 1998                  By:      s/b A. Earl Swift
          -----------------                  -----------------------------------
                                             A. Earl Swift
                                             Director and Principal
                                             Executive Officer

Date:     February 18, 1998                  By:      s/b Virgil N. Swift
          -----------------                  -----------------------------------
                                             Virgil N. Swift
                                             Director and Executive
                                             Vice President - Business
                                             Development


                                     IV-11


<PAGE>


          SWIFT ENERGY MANAGED PENSION ASSETS PARTNERSHIP 1988-2, LTD.


Date:      February 18, 1998                 By:      s/b G. Robert Evans
           -----------------                 -----------------------------------
                                             G. Robert Evans
                                             Director

Date:      February 18, 1998                 By:      s/b Raymond O. Loen
           -----------------                 -----------------------------------
                                             Raymond O. Loen
                                             Director

Date:      February 18, 1998                 By:      s/b Henry C. Montgomery
           -----------------                 -----------------------------------
                                             Henry C. Montgomery
                                             Director

Date:      February 18, 1998                 By:      s/b Clyde W. Smith, Jr.
           -----------------                 -----------------------------------
                                             Clyde W. Smith, Jr.
                                             Director

Date:      February 18, 1998                 By:      s/b Harold J. Withrow
           -----------------                 -----------------------------------
                                             Harold J. Withrow
                                             Director


                                     IV-12