UNITED STATES 
                   SECURITIES AND EXCHANGE COMMISSION 
                           Washington, DC 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, 1998 
                                       _______________________  
                                  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      0-19214 
                        ___________________ 
 
                UNION NATIONAL FINANCIAL CORPORATION 
_________________________________________________________________ 
      (Exact Name of Registrant as Specified in its Charter) 
 
        Pennsylvania                         23-2415179 
_______________________________         _______________________   
(State or Other Jurisdiction of            (I.R.S. Employer      
Incorporation or Organization)           Identification Number) 
 
101 East Main Street, P.O. Box 567  
    Mount Joy, Pennsylvania                        17552 
______________________________________           ___________ 
(Address of Principal Executive Offices)          (Zip Code) 
 
 
                            (717) 653-1441 
_________________________________________________________________ 
        (Registrant's Telephone Number, Including Area Code) 
Securities registered pursuant to Section 12(b) of the Act:None 
Securities registered pursuant to Section 12(g) of the Act: 
 
                      Common Stock, $0.25 Par Value 
_________________________________________________________________ 
                             (Title of Class) 
<PAGE> 
    Indicate by check mark whether the registrant:  (1) has filed 
all reports required to be filed by Section 13 or 15(d) of the 
Securities Exchange Act of 1934 during the preceding 12 months 
(or for such shorter period that the registrant was required to 
file such reports), and (2) has been subject to such filing 
requirements for the past 90 days.           Yes [X]   No [ ] 
                                         _______________________ 
 
   Indicate 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. [   ] 
 
The aggregate market value of the shares of Common Stock of the 
Registrant held by nonaffiliates of the Registrant was 
$42,817,807 as of March 23, 1999.  As of March 23, 1999, the 
Registrant had 2,401,246 shares of Common Stock outstanding. 
 
                   DOCUMENTS INCORPORATED BY REFERENCE: 
 
    Excerpts from Union National Financial Corporation's 1998
Annual Report to Stockholders (the "1998 Annual Report") are
incorporated by reference into Parts I, II and IV, hereof.  The
Registrant's Proxy Statement for its 1999 Annual Meeting is
incorporated by reference in response to Parts III and IV,
hereof. 
<PAGE> 
                 UNION NATIONAL FINANCIAL CORPORATION 
                               FORM 10-K 
                                 INDEX 
 
                                                         PAGE N0. 
PART I 
 
Item 1 -     Business                                       1 
 
Item 2 -     Properties                                    10 
 
Item 3 -     Legal Proceedings                             11 
 
Item 4 -     Submission of Matters to a Vote of  
             Security Holders                              12 
 
PART II 
 
Item 5 -     Market for Registrant's Common Equity and 
             Related Shareholder Matters                   12 
 
Item 6 -     Selected Financial Data                       12 
 
Item 7 -     Management's Discussion and Analysis of Financial    
             Condition and Results of Operation            12 
 
Item7A -     Quantitative and Qualitative About Market Risk       
                                                           13 
 
Item 8 -     Financial Statements and Supplementary Data   13 
 
Item 9 -     Changes In and Disagreements With Accountants 
             on Accounting and Financial Disclosure        13 
 
PART III 
 
Item 10 -    Directors and Executive Officers of the  
             Registrant                                    13 
 
Item 11 -    Executive Compensation                        14 
 
Item 12 -    Security Ownership of Certain Beneficial 
             Owners and Management                         14 
<PAGE> 
Item 13 -    Certain Relationships and Related  
             Transactions                                  14 
 
PART IV 
 
Item 14 -    Exhibits, Financial Statements, Schedules 
             and Reports on Form 8-K                       14 
 
Signatures                                                 17 

Exhibit Index                                              19 
<PAGE> 
PART I 
ITEM 1.   BUSINESS.
___________________

    Union National Financial Corporation, a Pennsylvania business
corporation, is a bank holding company registered under the Bank
Holding Company Act of 1956, as amended (the "BHC Act") and is
supervised by the Board of Governors of the Federal Reserve
System (the "Federal Reserve Board").  Union National Financial
Corporation was incorporated on June 26, 1986, under the Business
Corporation Law of the Commonwealth of Pennsylvania.  Union
National Financial Corporation commenced operations on January 2,
1987, upon consummation of the acquisition of all of the
outstanding shares of The Union National Mount Joy Bank, which
effective February 6, 1998, changed its name to Union National
Community Bank.  Union National Financial Corporation's business
consists primarily of managing and supervising Union National
Community Bank, and its principal source of income is dividends
paid by Union National Community Bank.  Union National Financial
Corporation has one wholly-owned subsidiary, Union National
Community Bank.

    Union National Community Bank was organized in 1865 under a
national charter.  Union National Community Bank is a national
banking association and a member of the Federal Reserve System. 
The deposits of Union National Community Bank are insured by the
Federal Deposit Insurance Corporation (the "FDIC") to the maximum
extent permitted by law.  Union National Community Bank, having
one main office with an annex and six branch locations within
Lancaster County, Pennsylvania, is a full service commercial
bank, providing a wide range of services to individuals and small
to medium-sized businesses in its south central Pennsylvania
market area, including accepting time, demand, and savings
deposits and making secured and unsecured commercial, real estate
and consumer loans.  Union National Community Bank also has a
full-service trust department.

    Union National Financial Corporation's executive offices are
located at 101 East Main Street, P.O. Box 567, Mount Joy,
Pennsylvania 17552 (telephone number:  (717) 653-1441).
     
    We have made forward-looking statements in this document, and
in documents that we incorporate by reference, that are subject
to risks and uncertainties.  Forward-looking statements include
the information concerning possible or assumed future results of
operations of Union National Financial Corporation, Union
National Community Bank or the combined company. When we use
words such as "believes," "expects," "anticipates" or similar
expressions, we are making forward-looking statements.
 
    Readers should note that many factors, some of which are
discussed elsewhere in this document and in the documents that we
incorporate by reference, could affect the future financial
results of Union National Financial Corporation, Union National
Community Bank or the combined company and could cause those
results to differ materially from those expressed in our 
<PAGE> 
forward-looking statements contained or incorporated by reference
in this document. These factors include the following:
 
     -   operating, legal and regulatory risks;
   
     -   economic, political, and competitive forces affecting
         our banking, securities, asset management and credit
         services businesses;        

     -   rapidly changing technology; and
 
     -   the risk that our analyses of these risks and forces
         could be incorrect and/or that the strategies developed
         to address them could be unsuccessful.

    Union National Financial Corporation operates in a heavily
regulated environment.  Changes in laws and regulations affecting
Union National Financial Corporation and its subsidiary, Union
National Community Bank, may have an impact on operations.  See
"Supervision and Regulation Union National Financial Corporation"
and "Supervision and Regulation Union National Community Bank"
and page 32 of the 1998 Annual Report, which page is included at
Exhibit 13 hereto, and incorporated herein by reference.

    Union National Financial Corporation experiences substantial
competition in attracting and retaining deposits and in lending
funds.  Primary factors in competing for deposits are the ability
to offer attractive rates and the convenience of office
locations.  Direct competition for deposits comes primarily from
other commercial banks and thrift institutions.  Competition for
deposits also comes from money market mutual funds, corporate and
government securities and credit unions.  The primary factors in
the competition for loans are interest rates, loan origination
fees and the range of products and services offered.  Competition
for origination of real estate loans normally comes from other
commercial banks, thrift institutions, mortgage bankers, mortgage
brokers and insurance companies.  

    For additional information with respect to Union National
Financial Corporation's business activities, see Part II, Item 7
hereof.  Certain significant regulatory matters are discussed
below.
     
Supervision and Regulation - Union National Financial Corporation
_________________________________________________________________

    Union National Financial Corporation is subject to the
provisions of the BHC Act, and to supervision by the Board of
Governors of the Federal  Reserve System (the "Federal Reserve
Board").  The BHC Act requires that Union National Financial
Corporation secure the prior approval of the Federal Reserve
Board before it owns or controls, directly or indirectly, more
than 5 percent of the voting shares or substantially all of the
assets of any institution, including another bank.  In addition,
the Riegle-Neal Interstate Banking and Branching Efficiency Act,
which amended the BHC Act, permits bank holding companies to
acquire a bank located in any state subject to certain
limitations and restrictions.
<PAGE> 
    A bank holding company is prohibited from engaging in or
acquiring direct or indirect control of more than 5 percent of
the voting shares of any company engaged in non-banking
activities unless the Federal Reserve Board, by order or
regulation, has found such activities to be so closely related to
banking or managing or controlling banks as to be a proper
incident thereto.  In making this determination, the Federal
Reserve Board considers whether the performance of these
activities by a bank holding company would offer benefits to the
public that outweigh possible adverse effects.

    Federal law also prohibits acquisitions of control of a bank
holding company without prior notice to certain federal bank
regulators.  Control is defined for this purpose as the power,
directly or indirectly, to direct the management or policies of
the bank or bank holding company or to vote 25 percent or more of
any class of voting securities.

    Subsidiary banks of a bank holding company are subject to
certain restrictions imposed by the Federal Reserve Act on any
extensions of credit to the bank holding company or any of its
subsidiaries, on investments in the stock or other securities of
the bank holding company and on taking of such stock or
securities as collateral for loans to any borrower.

    Permitted Activities.  The Federal Reserve Board permits bank 
    ___________________  
holding companies to engage in certain activities so closely
related to banking or managing or controlling banks as to be a
proper incident thereto.  Other than making equity investments in
low to moderate income housing limited partnerships, Union
National Financial Corporation does not at this time engage in
any other permissible activities, nor does Union National
Financial Corporation have any current plans to engage in any
other permissible activities in the foreseeable future.

    Legislation and Regulatory Changes.  From time to time, 
    ___________________________________
legislation is enacted which has the effect of increasing the
cost of doing business, limiting or expanding permissible
activities or affecting the competitive balance between banks and
other financial institutions.  Proposals to change the laws and
regulations governing the operations and taxation of banks, bank
holding companies and other financial institutions are frequently
made in Congress, and before various bank regulatory agencies. 
Management cannot predict the likelihood of any major changes or
the impact such changes might have on Union National Financial
Corporation and its subsidiary.  Certain changes of potential
significance to Union National Financial Corporation which have
been enacted recently and others which are currently under
consideration by Congress or various regulatory or professional
agencies are discussed below.

    The Federal Reserve Board, the FDIC and the Comptroller of
the Currency (the "Comptroller") have issued certain risk-based
capital guidelines, which supplement existing capital
requirements.  The guidelines require all United States banks and
bank holding companies to maintain a minimum risk-based capital
ratio of 8 percent (of which at least 4 percent must be in the
form of common stockholders' equity).  Assets are assigned to
five risk categories, with higher levels of capital required for
the categories perceived as representing greater risk.  The
required capital will represent equity and (to the extent
permitted) nonequity capital as a percentage of total
risk-weighted  
<PAGE> 
assets.  The risk-based capital rules are designed to make
regulatory capital requirements more sensitive to differences in
risk profiles among banks and bank holding companies and to
minimize disincentives for holding liquid assets.  On the basis
of an analysis of the rules and the projected composition of
Union National Financial Corporation's consolidated assets,
management does not believe that the risk-based capital rules
have a material effect on Union National Financial Corporation's
business and capital plans.  Union National Community Bank has
capital ratios exceeding the regulatory requirements.  See pages
13, 31 and 32 of Union National Financial Corporation's 1998
Annual Report for information concerning Union National Financial
Corporation's capital ratios, which pages are included at Exhibit
13, hereto, and incorporated herein by reference.

    Pending Legislation.  Management cannot anticipate what 
    ___________________
changes Congress may enact or, if enacted, their impact on Union
National Financial Corporation's financial position and reported
results of operation.  As a consequence of the extensive
regulation of commercial banking activities in the United States,
Union National Financial Corporation's and Union National
Community Bank's business is particularly susceptible to being
affected by federal and state legislation and regulations that
may increase the costs of doing business. See also, page 32 of
Union National Financial Corporation's 1998 Annual Report, which
page is included at Exhibit 13, hereto, and incorporated herein
by reference. 

    Effects of Inflation.  Inflation has some impact on Union 
    ____________________
National Financial Corporation's and Union National Community
Bank's operating costs.  Unlike many industrial companies,
however, substantially all of Union National Community Bank's
assets and liabilities are monetary in nature.  As a result,
interest rates have a more significant impact on Union National
Financial Corporation's and Union National Community Bank's
performance than the general level of inflation.  Over short
periods of time, interest rates may not necessarily move in the
same direction or in the same magnitude as prices of goods and
services.

    Monetary Policy.  The earnings of Union National Financial 
    _______________
Corporation and Union National Community Bank are affected by
domestic economic conditions and the monetary and fiscal policies
of the United States Government and its agencies.  An important
function of the Federal Reserve System is to regulate the money
supply and interest rates.  Among the instruments used to
implement those objectives are open market operations in United
States government securities and changes in reserve requirements
against member bank deposits.  These instruments are used in
varying combinations to influence overall growth and distribution
of bank loans, investments and deposits, and their use may also
affect rates charged on loans or paid for deposits.

    Union National Community Bank is a member of the Federal
Reserve System.  The policies and regulations of the Federal
Reserve Board have a significant effect on its deposits, loans
and investment growth, as well as the rate of interest earned and
paid, and are expected to affect Union National Community Bank's
operations in the future.  The effect of such policies and
regulations upon the future business and earnings of Union
National Financial Corporation and Union National Community Bank
cannot be predicted.
<PAGE> 
    Federal Taxation.  Union National Financial Corporation and 
    ________________
Union National Community Bank are subject to those rules of
federal income taxation generally applicable to corporations and
report their respective income and expenses on the accrual method
of accounting.  Union National Financial Corporation and its
subsidiary file a consolidated federal income tax return on a
calendar year basis.  Intercompany distributions (including
dividends) and certain other items of income and loss derived
from intercompany transactions are eliminated upon consolidation
of all the consolidated group members' respective taxable income
and losses.

    The Internal Revenue Code (the "IRC") imposes a corporate
alternative minimum tax ("AMT").  The corporate AMT only applies
if such tax exceeds a corporation's regular tax liability.  In
general, the tentative AMT is calculated by multiplying the
corporate AMT rate of 20% by an amount equal to the excess of (i)
the sum of (a) regular taxable income plus (b) certain
adjustments, as provided in IRC Sections 56 and 58, and tax
preference items, as provided in IRC Section 57  ("alternative
minimum taxable income" or "AMTI") over (ii) an exemption amount
($40,000 for a corporation, that such amount is reduced by 25% of
the excess of AMTI over $150,000 and is completely eliminated
when AMTI equals $310,000).  The excess of the tentative AMT over
the regular tax for the taxable year is the taxpayer's net
minimum tax liability.

    State Tax.  Union National Financial Corporation is subject 
    _________
to the Pennsylvania Corporate Net Income Tax and Capital Stock
Tax.  The Corporate Net Income Tax rate for 1998 and thereafter
is 9.99% and is imposed upon a corporate taxpayer's
unconsolidated taxable income  for federal tax purposes with
certain adjustments.  In general, the Capital Stock Tax is a
property tax imposed on a corporate taxpayer's capital stock
value apportionable to the Commonwealth of Pennsylvania, which is
determined in accordance with a fixed formula based upon average
book income and net worth.  In the case of a holding company, an
optional elective method permits the corporate taxpayer to be
taxed on only 10% of such capital stock value.  The Capital Stock
Tax rate is presently 1.275%. 

    Environmental Laws.  Neither Union National Financial 
    __________________
Corporation nor Union National Community Bank anticipate that
compliance with environmental laws and regulations will have any
material effect on capital, expenditures, earnings, or on its
competitive position.  However, environmentally related hazards
have become a source of high risk and potentially unlimited
liability for financial institutions.  Environmentally
contaminated properties owned by an institution's borrowers may
result in a drastic reduction in the value of the collateral
securing the institution's loans to such borrowers, high
environmental clean up costs to the borrower affecting its
ability to repay the loans, the subordination of any lien in
favor of the institution to a state or federal lien securing
clean up costs, and liability to the institution for clean up
costs if it forecloses on the contaminated property or becomes
involved in the management of the borrower.  To minimize this
risk, Union National Community Bank may require an environmental
examination of and report with respect to the property of any
borrower or prospective borrower if circumstances affecting the
property indicate a potential for contamination, taking into
consideration a potential loss to the institution in relation to
the borrower.  Such examination must be performed by an
engineering firm experienced in environmental risk studies and
acceptable to the institution, and the cost of such 
<PAGE> 
examinations and reports are the responsibility of the borrower. 
These costs may be substantial and may deter a prospective
borrower from entering into a loan transaction with Union
National Community Bank.  Union National Financial Corporation is
not aware of any borrower who is  currently subject to any
environmental investigation or clean up proceeding that is likely
to have a material adverse effect on the financial condition or
results of operations of Union National Community Bank.

    In 1995, the Pennsylvania General Assembly enacted the
Economic Development Agency, Fiduciary and Lender Environmental
Liability Protection Act which, among other things, provides
protection to lenders from environmental liability and
remediation costs under the environmental laws for releases and
contamination caused by others.  A lender who engages in
activities involved in the routine practices of commercial
lending, including, but not limited to, the providing of
financial services, holding of security interests, workout
practices, foreclosure or the recovery of funds from the sale of
property shall not be liable under the environmental acts or
common law equivalents to the Pennsylvania Department of
Environmental Resources or to any other person by virtue of the
fact that the lender engages in such commercial lending practice. 
A lender, however, will be liable if it, its employees or agents,
directly cause an immediate release or directly exacerbate a
release of regulated substances on or from the property, or
knowingly and willfully compelled the borrower to commit an
action which caused such release or violate an environmental act. 
The Economic Development Agency, Fiduciary and Lender
Environmental Liability Protection Act, however, does not limit
federal liability which still exists under certain circumstances.

    As discussed above, there are several federal and state
statutes that regulate the obligations and liabilities of
financial institutions pertaining to environmental issues.  In
addition to the potential for attachment of liability resulting
from  its own actions, a bank  may be held liable under certain
circumstances for the actions of its borrowers, or third parties,
when such actions result in environmental problems on properties
that collateralize loans held by Union National Community Bank. 
Further, the liability has the potential to far exceed the
original amount of the loan issued by Union National Community
Bank.  Currently, neither Union National Financial Corporation
nor Union National Community Bank is a party to any pending legal
proceeding pursuant to any environmental statute, nor is Union
National Financial Corporation or Union National Community Bank
aware of any circumstances that may give rise to liability under
any such statute.

    Supervision and Regulation - Union National Community Bank
_________________________________________________________________

    The operations of Union National Community Bank are subject
to federal and state statutes applicable to banks chartered under
the banking laws of the United States, to members of the Federal
Reserve System and to banks whose deposits are insured by the
FDIC.  Bank operations are also subject to regulations of the
Comptroller, the Federal Reserve Board and the FDIC.

    The primary supervisory authority of Union National Community
Bank is the Comptroller, which regulates and examines Union
National Community Bank.  The Comptroller has the authority
<PAGE> 
under the Financial Institutions Supervisory Act to prevent a
national bank from engaging in an unsafe or unsound practice in
conducting its business.

    Federal and state banking laws and regulations govern, among
other things, the scope of a bank's business, the investments a
bank may make, the reserves against deposits a bank must
maintain, loans a bank makes and collateral it takes, the maximum
interest rates a bank may pay on deposits, the activities of a
bank with respect to mergers and consolidations and the
establishment of branches.  

    As a subsidiary of a bank holding company, Union National
Community Bank is subject to certain restrictions imposed by the
Federal Reserve Act on any extensions of credit to the parent
bank holding company or its subsidiaries, on investments in the
stock or other securities of the bank holding company or its
subsidiaries and on taking such stock or securities as collateral
for loans.  The Federal Reserve Act and Federal Reserve Board
regulations also place certain limitations and reporting
requirements on extensions of credit by a bank to principal
shareholders of its parent holding company, among others, and to
related interests of such principal shareholders.  In addition,
such legislation and regulations may affect the terms upon which
any person becoming a principal shareholder of a holding company
may obtain credit from banks with which the subsidiary bank
maintains a correspondent relationship. 

    Federal Deposit Insurance Act.  Under the Federal Deposit 
    _____________________________
Insurance Act, the Comptroller possesses the power to prohibit
institutions regulated by it (such as Union National Community
Bank) from engaging in any activity that would be an unsafe or
unsound banking practice or would otherwise be in violation of
the law.  

    Community Reinvestment Act.  The Community Reinvestment Act 
    __________________________
("CRA") now emphasizes performance over process and
documentation.  Under these revised rules, a five-point rating
scale is used; a bank's compliance is determined by a three-prong
test whereby examiners assign a numerical score for a bank's
performance in each of three areas: lending, service and
investment.  The area of lending is weighted to increase its
importance in the application of the test.  When rating a bank in
the area of lending, regulators examine the number and amount of
loan originations, the location of where the loans were made, and
the income levels of the borrowers.  Although banks, under the
revised rules, are not required to make loans in every area, if
there are apparent tracts in which there is little lending,
examiners will focus their investigations in that area.  The
service prong evaluates how a bank delivers its products to the
community through branching.  As with lending, banks are not
required to branch in every area, although conspicuous gaps will
be investigated.  The third prong, investment in community,
examines how Union National Community Bank meets the investment
needs in the community within which it operates.  Assessment of
investment is accomplished using a "performance context" pursuant
to which regulators meet with civic, community and bank officials
in order to determine the credit needs of the community.

    Home Mortgage Disclosure Act.  Expanded Home Mortgage 
    ____________________________
Disclosure Act reporting requirements were also approved for
large banks and thrifts which require reporting of census tract
<PAGE> 
data on mortgages made outside of the delineated communities.  In
addition, effective March 1, 1997, institutions with assets above 
$250 million were required to report their aggregate small
business loans made by geographic region.  Independent banks with
total assets of less than $250 million and bank subsidiaries with
total assets of less than $250 million that have holding
companies with total assets of less than $1 billion are subjected
to less stringent CRA examinations.

    Under the new regulation, banks enjoy a reduction in
compliance burden.  Banks are not required to keep extensive
documentation to prove that directors have participated in
drafting and review of CRA policies.  A formal CRA statement need
not be prepared.  The efforts banks make to market in low - and
moderate-income communities do not have to be documented, nor
will banks have to justify the basis for their community
delineation or the methods used to determine the credit needs of
the community.

    Bank Secrecy Act.  Under the Bank Secrecy Act ("BSA"), banks 
    _________________
and other financial institutions are required to report to the
Internal Revenue Service currency transactions of more than
$10,000 or multiple transactions of which Union National
Community Bank is aware in any one day that aggregate in excess
of $10,000.  Civil and criminal penalties are provided under the
BSA for failure to file a required report, for failure to supply
information required by the BSA or for filing a false or
fraudulent report.

    Federal Deposit Insurance Corporation Improvement Act of 
    ________________________________________________________
1991.  Under the Federal Deposit Insurance Corporation 
____
Improvement Act of 1991 ("FDICIA") institutions must be
classified in one of five defined categories as illustrated below
(well capitalized, adequately capitalized, undercapitalized,
significantly undercapitalized and critically undercapitalized).
<TABLE>
<CAPTION> 
                          Total     Tier 1              Under a 
                          Risk-      Risk-    Tier 1    Capital 
                          Based      Based   Leverage   Order or 
                          Ratio      Ratio    Ratio    Directive 
                         _______     ______   ______   __________ 
<S>                        <C>        <C>      <C>         <C> 
CAPITAL CATEGORY 
Well capitalized          >10.0       >6.0     >5.0        No     
Adequately capitalized    > 8.0       >4.0     >4.0*              
Undercapitalized          < 8.0       <4.0     <4.0*              
Significantly  
  undercapitalized        < 6.0       <3.0     <3.0               
 Critically  
  undercapitalized                             <2.0               
 
*3.0 for those banks having the highest available regulatory 
rating. 
</TABLE> 
In the event an institution's capital deteriorates to the
undercapitalized category or below, FDICIA prescribes an
increasing amount of regulatory intervention, including:  (1) the
institution by a bank of a capital restoration plan and a
guarantee of the plan by a parent institution; and (2) the
placement of a hold on increases in assets, number of branches or
lines of business.  If capital has reached the significantly or
critically undercapitalized levels, further material restrictions
can be imposed, including restrictions on interest payable on
accounts, dismissal of management and (in critically
undercapitalized situations) appointment of a receiver.  For well
capitalized institutions, FDICIA provides authority for
regulatory intervention where the institution is deemed to be
<PAGE> 
engaging in unsafe or unsound practices or receives a less than
satisfactory examination report rating for capital, asset
quality, management, earnings, liquidity or sensitivity to market
risk.  All but well capitalized institutions are prohibited from
accepting brokered deposits without prior regulatory approval.

    Under FDICIA, financial institutions are subject to increased
regulatory scrutiny and must comply with certain operational,
managerial and compensation standards to be developed by Federal
Reserve Board regulations.  FDICIA also requires the regulators
to issue new rules establishing certain minimum standards to
which an institution must adhere including standards requiring a
minimum ratio of classified assets to capital, minimum earnings
necessary to absorb losses and minimum ratio of market value to
book value for publicly held institutions.  Additional
regulations are required to be developed relating to internal
controls, loan documentation, credit underwriting, interest rate
exposure, asset growth and excessive compensation, fees and
benefits.  

        Truth-In-Savings.  A separate subtitle within FDICIA, 
        ________________
called the "Bank Enterprise Act of 1991", requires "truth-in-
savings" on consumer deposit accounts so that consumers can make
meaningful comparisons between the competing claims of banks with
regard to deposit accounts and products.  Under this provision,
Union National Community Bank is required to provide information
to depositors concerning the terms of their deposit accounts, and
in particular, to disclose the annual percentage yield.  There
are some operational costs of complying with the Truth-In-Savings
law.

    Management believes that full implementation of FDICIA has 
had no material impact on liquidity, capital resources or
reported results of operation.  If FDIC insurance premiums
assessments increase in the future, Management believes such
future increase may have a material impact on future reported
results of operations.

        Other.  From time to time, various types of federal and 
        _____
state legislation have been proposed that could result in
additional regulation of, and restrictions on, the business of
Union National Community Bank.  It cannot be predicted whether
any such legislation will be adopted or, if adopted, how such
legislation would affect the business of Union National Community
Bank.  As a consequence of the extensive regulation of commercial
banking activities in the United States, Union National Community
Bank's business is particularly susceptible to being affected by
federal legislation and regulations that may increase the costs
of doing business.

        Statistical Data.  The information required by this Item 
        ________________
is incorporated by reference from pages 18 through 32 of Union
National Financial Corporation's 1998 Annual Report.

        Employees.  As of March 23, 1999, Union National 
        __________
Community Bank had 110 full-time employees and 23 part-time
employees.  None of  these employees is represented by a
collective bargaining agent, and Union National Financial
Corporation believes it enjoys good relations with its personnel. 
<PAGE> 
ITEM 2.   PROPERTIES.
______    ___________
    Union National Community Bank owns its main office, five
branch offices, the administration services center and certain
parking facilities related to its banking offices, all of which
are free and clear of any lien.  Union National Community Bank's
main office is located in the central business district of Mount
Joy, Pennsylvania.  Below is a table containing the location and
date of acquisition of Union National Community Bank's
properties.  In addition, Union National Community Bank leases
office space for one branch office located in Manheim,
Pennsylvania.
<TABLE> 
         PROPERTIES OWNED BY UNION NATIONAL COMMUNITY BANK 
<CAPTION> 
 
Office and Address   Description of Property     Date Acquired 
__________________   _______________________   ________________ 
<S>                           <C>                      <C>  
Main Office              Main Bank Office              1911 
101 East Main Street     Cut limestone and brick. 
Mount Joy, PA  17552     1995 addition is concrete 
                         over steel construction. 
                         Containing approximately 
                         a total of 22,251 sq. ft. 
                         of space. 
 
Main Office Annex        Wood frame                   September, 1992
115 East Main Street     construction             
Mount Joy, PA 17552      with aluminum siding. 
                         Containing approximately 
                         1,632 sq. ft. of space. 
 
Maytown Branch Office    Branch Bank                  April, 1972 
100 West High Street     Brick veneer, shingled roof 
Maytown, PA  17550       with wood trusses.  Containing 
                         approximately 4,960 sq. ft. 
                         of space. 
 
Hempfield Branch Office  Branch Bank                   June, 1979 
190 Stony Battery Road   Brick with wood shingle roof. 
Salunga, PA  17538       Containing approximately 
                         4,619 sq. ft. of space. 
 
Elizabethtown Branch     Branch Bank                January, 1988 
Office                   Brick veneer, shingled roof 
1275 South Market Street with wood trusses. 
Elizabethtown PA 17022   Containing approximately 
                         6,668 sq. ft. of space. 
<PAGE>
Motor Bank Branch Office Drive-up Bank Branch      November, 1972 
21 North Barbara Street  Brick on frame. 
Mount Joy, PA  17552     Containing approximately 
                         445 sq. ft. of space. 
 
Administration Services  Brick on concrete block   December, 1984 
Center                    with wood and steel frame.              
Bank Administration      Containing approximately 
Building                 9,398 sq. ft. of space. 
25 North Barbara Street   
Mount Joy, PA  17552      
 
Columbia Branch Office   Branch Bank                October, 1992 
921 Lancaster Avenue     One story brick building 
Columbia, PA  17512      containing approximately 
                         2,257 sq. ft. of space. 
</TABLE> 
<TABLE> 
 
                        PROPERTY LEASED BY THE BANK 
<CAPTION> 
Office and Address        Description of Property     Date Leased 
_____________________    ________________________   _____________ 
<S>                              <C>                     <C> 
Manheim Branch Office    Concrete block building   January, 1995 
701 Lancaster Road       containing 4,266 sq. ft. 
Manheim, PA 17545        of space of which approximately 
                         2,600 sq. ft. of space is 
                         currently used for banking 
                         purposes. 
 
</TABLE> 
In management's opinion, the above properties are in good
condition and are adequate for Union National Community Bank's
purposes.
 
ITEM 3.    LEGAL PROCEEDINGS.
______     __________________

   Management, after consulting with Union National Financial
Corporation's legal counsel, is not aware of any litigation that
would have a material adverse effect on the consolidated
financial position of Union National Financial Corporation. 
There are no proceedings pending other than ordinary routine
litigation incident to the business of Union National Financial
Corporation and its subsidiary, Union National Community Bank. 
In addition, no material proceedings are known to be contemplated
by governmental authorities against Union National Financial
Corporation or Union National Community Bank.
<PAGE>
ITEM 4.    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
______    ____________________________________________________

    None.
                             PART II
                             _______

ITEM 5.    MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED  
______     _________________________________________________
           STOCKHOLDER MATTERS.
           ____________________

    Market and dividend information required by this Item is
incorporated by reference herein, from the inside front cover of
Union National Financial Corporation's 1998 Annual Report.  Union
National Financial Corporation's common stock is traded on a very
limited basis in the local over-the-counter market.  Bid and
asked information is not regularly quoted.  Information
concerning actual trades is included on the inside front cover of
Union National Financial Corporation's 1998 Annual Report.  This
information represents a limited amount of share transfer
activity.

    Union National Financial Corporation and, prior to Union
National Financial Corporation's organization as a bank holding
company, Union National Community Bank paid regular cash
dividends on their common stock for more than thirty-five years. 
Union National Financial Corporation expects to pay future
dividends; however, payment of such dividends will depend upon
earnings of Union National Financial Corporation and of Union
National Community Bank, their financial condition, capital
requirements and other factors, such as regulatory and legal
requirements.  It is anticipated that substantially all of the
funds available for the payment of dividends by Union National
Financial Corporation will be derived from dividends paid to it
by Union National Community Bank.

    Additional information required by this Item regarding
dividend restrictions is incorporated by reference herein, from
page 32 of Union National Financial Corporation's 1998 Annual
Report, which page is included in Exhibit 13, attached hereto.

    As of March 23, 1999, there were approximately 927 holders of
record of Union National Financial Corporation's common stock.

ITEM 6.    SELECTED FINANCIAL DATA.
______     ________________________

    The information required by this Item is incorporated by
reference herein, from pages 18 and 19 of Union National
Financial Corporation's 1998 Annual Report, which page is
included in Exhibit 13, attached hereto.

ITEM 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL 
______     _________________________________________________
           CONDITION AND RESULTS OF OPERATION.
           ___________________________________

    The information required by this Item is incorporated by
reference herein, from pages 20 through 32 of Union National
Financial Corporation's 1998 Annual Report, which pages are
included in Exhibit 13, attached hereto.
<PAGE>
ITEM 7A.    QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT 
_______     _____________________________________________
            MARKET RISK.
            ____________

    The information required by this Item is incorporated by
reference herein, from pages 29 and 30 of Union National
Financial Corporation's 1998 Annual Report, which pages are
included in Exhibit 13, attached hereto.            

ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
_______    ____________________________________________

    The information required by this Item is incorporated by
reference herein, from pages 4 through 18 of Union National
Financial Corporation's 1998 Annual Report, which pages are
included in Exhibit 13, attached hereto.

ITEM 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON 
______     ________________________________________________
           ACCOUNTING AND FINANCIAL DISCLOSURE.
           ____________________________________
    None.

                           PART III
                           _________
ITEM 10.   DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT.
________   _______________________________________________

    The information required by this Item is incorporated by
reference herein, from pages 5 through 11 and pages 22 through 24
of Union National Financial Corporation's Proxy Statement for its
1999 Annual Meeting of Shareholders.

    Section 16(a) Beneficial Ownership Compliance.  Section 16(a) 
    _____________________________________________
of the Securities Exchange Act of 1934, as amended, requires
Union National Financial Corporation's officers and directors,
and persons who own more than 10 percent of a registered class of
Union National Financial Corporation's equity securities, to file
reports of ownership and changes in ownership with the Securities
and  Exchange Commission (the "SEC").  Officers, directors and
greater than 10 percent shareholders are required by SEC
regulation to furnish Union National Financial Corporation with
copies of all Section 16(a) forms they file.

    Based solely on its review of the copies of such forms
received by it or written representations from certain reporting
persons, Union National Financial Corporation believes that
during the period January 1, 1998 through December 31, 1998, its
officers and directors were in compliance with all filing
requirements applicable to them, except that Mr. Daniel H.
Raffensperger, Class B Director, filed one late report during
1998 for one transaction affecting his ownership of Union
National Financial Corporation Common Stock.
<PAGE> 
ITEM 11.    EXECUTIVE COMPENSATION.
________    _______________________

    The information required by this Item is incorporated by
reference herein, from pages 12 through 20 of Union National
Financial Corporation's Proxy Statement for its 1999 Annual
Meeting of Shareholders.

ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND 
________    ___________________________________________________
            MANAGEMENT.
            ___________

    The information required by this Item is incorporated by
reference herein, from pages 4 through 6 and pages 22 through 24
of Union National Financial Corporation's Proxy Statement for its
1999 Annual Meeting of Shareholders.

ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
_______     _______________________________________________

    The information required by this Item is incorporated by
reference herein, from pages 21 and 22 of Union National
Financial Corporation's Proxy Statement for its 1999 Annual
Meeting of Shareholders. 
 
                                PART IV 
                                ________ 
ITEM 14.   EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS  
________   _____________________________________________________ 
           ON FORM 8-K. 
           ____________ 
 
            (a)  1.     Financial Statements. 
 
                        The following financial statements are
                        included by reference in Part II, Item 8
                        hereof. 
 
                        Independent Auditors' Report. 
                        Consolidated Balance Sheets. 
                        Consolidated Statements of Income 
                        Consolidated Statements of Cash Flows 
                        Consolidated Statements of Changes in
                          Stockholders' Equity 
                         Notes to Consolidated Financial          
                          Statements 
                                                         
                 2.     The financial statement schedules
                        required by this Item are omitted because
                        the information is either inapplicable, 
                        not required or is in the consolidated
                        financial statements as a part of this
                        Report. 

                 3.     The following Exhibits are filed
                        herewith, or incorporated by reference as
                        a part of this Report: 
<PAGE>
                        3(i) Union National Financial             
                             Corporation's Amended Articles of
                             Incorporation. (Incorporated by      
                             reference toExhibit 3(i) to Union
                             National  Financial Corporation's
                             Registration Statement No. 333-27837
                             on Form S-8, filed with the
                             Commission on May 27, 1997.) 
 
                       3(ii) Union National Financial
                             Corporation's Amended By-laws.
                             (Incorporated by reference to
                             Exhibit 3(ii) to Union National
                             Financial Corporation's Registration
                             Statement No. 333-27837 on Form S-8,
                             filed with the Commission on May 27,
                             1997), and the amendment thereto
                             dated November 14, 1998. 
 
                        10.1  Executive Employment Agreement
                              dated as of January 1, 1999,
                              between Mark D. Gainer and
  
                              Union National Financial
                              Corporation. 
 
                        10.2  Union National Financial
                              Corporation 1988 Stock Incentive
                              Plan. (Incorporated by reference
                              to Union National Financial
                              Corporation's Registration
                              Statement No. 333-27837 on Form
                              S-8, filed with the Commission
                              on May 27, 1997.) 
 
                        10.3  Union National Financial
                              Corporation 1997 Stock
                              Incentive Plan.  (Incorporated
                              by reference to Union National
                              Financial Corporation's
                              Registration Statement No.
                              333-27837 on Form S-8, filed with
                              the Commission on May 27, 1997.) 
 
                          11  Statement re: Computation of 
                              Earnings Per Share. 
                              (Incorporated by Reference to
                              page of 1 of Union National
                              Financial Corporation's 1998 Annual
                              Report, which is included herein at
                              Exhibit 13.) 
 
                          12  Statement re:  Computation of
                              Ratios. (Incorporated by 
                              Reference to page 19 of Union
                              National Financial Corporation's
                              1998 Annual Report, which is
                              included herein at Exhibit 13.)    
<PAGE>

                          13  Excerpts from Union National
                              Financial Corporation's 1998
                              Annual Report to Shareholders. 
 
                          21  Subsidiaries of the Union National
                              Financial Corporation.

                          23  Consent of Independent Auditors. 
 
                          27  Financial Data Schedule. 
 
            (b)  No Current Report on Form 8-K was filed by 
                 Union National Financial Corporation during the
                 fourth quarter of the 1998 fiscal year. 
                 
            (c)  The exhibits required to be filed by this Item 
                 are listed under Item 14(a)3, above. 
 
            (d)  NOT APPLICABLE. 
<PAGE> 
                           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. 
 
                            UNION NATIONAL FINANCIAL CORPORATION 
                             ____________________________________ 
                                             (Registrant) 
 
 
                          By  /s/ Mark D. Gainer             
                              ____________________________ 
                              Mark D. Gainer, President  
                              and Chief Executive Officer 
                                    
                              Date:    March 25, 1999 
 
Pursuant to the requirements of the Securities Exchange Act of 
1934, this report has been signed below by the following persons 
on behalf of Union National Financial Corporation and in the
capacities and on the dates indicated. 
 
                                               DATE 
                                               ____ 
 
By   /s/ Mark D. Gainer                   March 25, 1999 
     ________________________ 
     Mark D. Gainer      
     President, Chief Executive Officer  
     and Director (principal executive officer)
 
By   /s/ Donald H. Wolgemuth              March 25, 1999 
     ________________________ 
     Donald H. Wolgemuth
     Chairman of the Board of Directors     
     and Director

 
By   /s/ William E. Eby                   March 25, 1999 
     ________________________ 
     William E. Eby, Director 

By   /s/ Clement M. Hoober                March 25, 1999 
     ________________________ 
     Clement M. Hoober, CPA, 
     Chief Financial Officer (principal  
     financial officer and principal 
     accounting officer) 
<PAGE> 
By   /s/ Franklin R. Eichler              March 25, 1999 
     ________________________ 
     Franklin R. Eichler, Director 

By   /s/ E. Ralph Garber                  March 25, 1999 
     ________________________ 
     E. Ralph Garber, Director 
 
By   /s/ Daniel C. Gohn                   March 25, 1999 
     ________________________ 
     Daniel C. Gohn, Director 
 
By   /s/ Carl R. Hallgren                 March 25, 1999 
     ________________________ 
     Carl R. Hallgren, Director 
 
By   /s/ David G. Heisey                  March 25, 1999 
     ________________________ 
     David G. Heisey, Director 
 
By   /s/ William D. Linkous               March 25, 1999 
     ________________________ 
     William D. Linkous, Director 
 
By   /s/ Daniel H. Raffensperger          March 25, 1999 
     ________________________ 
     Daniel H. Raffensperger, Director 
 
By   /s/ Benjamin W. Piersol, Jr.         March 25, 1999 
     ________________________ 
     Benjamin W. Piersol, Jr., Director 
 
:94699
<PAGE> 
<TABLE> 
                            EXHIBIT INDEX 
                                                  Sequential Page 
 Exhibit                                       Number in Manually 
 Number                                           Signed Original 
 ______                                         _________________ 
  <S>    <C>                                           <C>        
  3(i)    Union National Financial Corporation's 
          Amended Articles of Incorporation.
         (Incorporated by reference to Exhibit 3(i)
          to Union National Financial Corporation's 
          Registration Statement No. 333-27837  
          on Form S-8, filed with the Commission on 
          May 27, 1997.) 
 
  3(ii)   Union National Financial Corporation's          27
          Amended By-laws.(Incorporated by reference 
          to Exhibit 3(ii) to Union National Financial
          Corporation's Registration Statement No. 333-27837
          on Form S-8, filed with the Commission on
          May 27, 1997), and the amendment thereto dated 
          November 14, 1998. 
 
  10.1    Executive Employment Agreement dated as of      29
          January 1, 1999, between Mark D. Gainer and  
          Union National Financial Corporation. 
 
  10.2    Union National Financial Corporation 1988 Stock  
          Incentive Plan. (Incorporated by Reference to  
          Union National Financial Corporation's 
          Registration Statement No. 333-27837  
          on Form S-8, filed with the Commission on  
          May 27, 1997.) 
 
  10.3    Union National Financial Corporation 1997 Stock  
          Incentive Plan.  (Incorporated by Reference to  
          Union National Financial Corporation's 
          Registration Statement No. 333-27837 
          on Form S-8, filed with the Commission on  
          May 27, 1997.) 
 
  11      Statement re: Computation of Earnings Per Share. 
          (Incorporated by Reference to page 1 of Union
          National Financial Corporation's 1998 Annual Report,
          which is included herein at Exhibit 13.) 
 
  12      Statement re:  Computation of Ratios.   
          (Incorporated by Reference to page 19 of 
          Union National Financial Corporation's 1998 Annual
          Report, which is included herein at Exhibit 13.)      
<PAGE> 
  13      Excerpts from Union National Financial          47 
          Corporation's 1998 Annual Report to 
          shareholders. 
 
  21      Subsidiaries of Union National Financial        84 
          Corporation. 
 
  23      Consent of Independent Auditors.                86
 
  27      Financial Data Schedule.                        88 
 
</TABLE>