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


                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB
(Mark One)

  X    Quarterly report under Section 13 or 15(d) of the Securities Exchange Act
----   of 1934

For the quarterly period ended March 31, 1998

       Transition report under Section 13 or 15(d) of the Exchange Act
----

For the transition period from ________ to ________

Commission file number 000-23377
                       ---------

                        INTERVEST BANCSHARES CORPORATION
        (Exact Name of Small Business Issuer as Specified in Its Charter)

        Delaware                                                13-3699013
        --------                                            ------------------
(State or Other Jurisdiction                                 (I.R.S. Employer
of Incorporation or Organization)                           Identification No.)

                        10 Rockefeller Plaza, Suite 1015
                          New York, New York 10020-1903
                          -----------------------------
                    (Address of Principal Executive Offices)

                                  (212)757-7300
                ------------------------------------------------
                (Issuer's Telephone Number, Including Area Code)

                         ------------------------------
         (Former Name, Former Address and Former Fiscal Year, if Changed
                               Since Last Report)

   Check  whether  the  issuer:  (1) filed all  reports  required to be filed by
Section  12, 13 or 15(d) of the  Exchange  Act during the past 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
   -----

   State the number of shares  outstanding  of each of the  issuer's  classes of
common equity, as of the latest practicable date;

Class A Common stock, par value $1.00 per share              2,150,125
-----------------------------------------------    -----------------------------
                  (class)                          Outstanding at April 20, 1998


Class B Common stock, par value $1.00 per share               300,000
-----------------------------------------------    -----------------------------
                  (class)                          Outstanding at April 20, 1998


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

                                                                 CONFORMED COPY


<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

                                      INDEX


Part I. Financial Information

   Item 1. Financial Statements                                         Page
                                                                       -----

     Condensed Consolidated Balance Sheets -
       March 31, 1998 (unaudited) and December 31, 1997.....................2

     Condensed Consolidated Statements of Earnings -
       Three Months ended March 31, 1998 and 1997 (unaudited)...............3

     Condensed Consolidated Statement of Stockholders' Equity -
       Three Months ended March 31, 1998 (unaudited).........................4

     Condensed Consolidated Statements of Cash Flows -
       Three Months ended March 31, 1998 and 1997 (unaudited)................5

     Notes to Condensed Consolidated Financial Statements (unaudited).......6-8

   Item 2. Management's Discussion and Analysis or Plan of Operation........9-10

Part II. Other Information

   Item 6. Exhibits and Reports on Form 8-K.................................11

SIGNATURES..................................................................11



                                        1

<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

                          PART I. FINANCIAL INFORMATION

                          Item 1. Financial Statements

                      Condensed Consolidated Balance Sheets
                                 (In thousands)
                                                          March 31, December 31,
    Assets                                                   1998       1997
                                                             ----       ----
                                                                  (unaudited)

Cash and due from banks                                    $  2,852      1,738
Federal funds sold                                              -          162
Short-term investments                                        5,875      7,276
                                                           --------   --------

            Total cash and cash equivalents                   8,727      9,176

Interest-bearing deposits with banks                             99         99
Securities held to maturity                                  65,977     58,821
Loans receivable, net                                        83,225     75,652
Accrued interest receivable                                   1,463      1,327
Premises and equipment, net                                   5,064      4,877
Restricted securities, Federal Reserve Bank stock, at cost      233        233
Deferred income tax asset                                       456        485
Other assets                                                    174         85
                                                           --------   --------
            Total                                          $165,418    150,755
                                                           ========   ========

    Liabilities and Stockholders' Equity

Liabilities:
    Demand deposits                                           2,877      3,490
    Savings and NOW deposits                                 20,780     17,119
    Money-market deposits                                    18,873     17,180
    Time deposits                                           100,879     93,378
                                                           --------   --------

            Total deposits                                  143,409    131,167

    Federal funds purchased                                   1,160        -
    Other liabilities                                         2,815      1,947
                                                           --------   --------

            Total liabilities                               147,384    133,114
                                                           --------   --------

Minority interest                                                21         21
                                                           --------   --------

Stockholders' Equity:
    Preferred stock                                            --          --
    Class A common stock                                      2,136      2,124
    Class B common stock                                        300        300
    Additional paid-in capital                               13,433     13,360
    Retained earnings                                         2,144      1,836
                                                           --------   --------

            Total stockholders' equity                       18,013     17,620
                                                           --------   --------

            Total                                          $165,418    150,755
                                                           ========   ========








See Accompanying Notes to Condensed Consolidated Financial Statements.

                                        2

<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

                  Condensed Consolidated Statements of Earnings
                (Dollars in thousands, except per share figures)

                                                             Three Months Ended
                                                                 March 31,
                                                           ---------------------
                                                           1998             1997
                                                           ----             ----
                                                                (Unaudited)
Interest income:
      Loans receivable                                  $    1,808         1,434
      Securities                                             1,029           598
      Other interest earning assets                             70            53
                                                        ----------    ----------

                 Total interest income                       2,907         2,085

Interest expense on deposits                                 1,838         1,309
                                                        ----------    ----------

                 Net interest income                         1,069           776

Provision for loan losses                                      100            92
                                                        ----------    ----------

                 Net interest income after
                     provision for loan losses                 969           684
                                                        ----------    ----------

Noninterest income:
      Customer service charges                                  46            27
      Other                                                      4             4
                                                        ----------    ----------

                 Total noninterest income                       50            31
                                                        ----------    ----------

Noninterest expenses:
      Salaries and employee benefits                           246           216
      Occupancy and equipment                                   74            90
      Advertising and promotion                                  7            11
      Professional fees                                         43            20
      Deposit insurance premiums                                 4             2
      Other                                                    135           122
                                                        ----------    ----------

                 Total noninterest expenses                    509           461
                                                        ----------    ----------

Earnings before income taxes                                   510           254

                 Income taxes                                  202            94
                                                        ----------    ----------

Net earnings                                            $      308           160
                                                        ==========    ==========

Basic earnings per share                                $      .13           .10
                                                        ==========    ==========

Diluted earnings per share                              $      .09           .09
                                                        ==========    ==========

Weighted-average number of shares
      outstanding for basic earnings per share           2,426,457     1,650,000
                                                        ==========    ==========

Weighted-average number of shares
      outstanding for diluted earnings per share         3,272,739     1,790,450
                                                        ==========    ==========


See Accompanying Notes to Condensed Consolidated Financial Statements

                                        3

<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

            Condensed Consolidated Statement of Stockholders' Equity

                 For the Three Month Period Ended March 31, 1998
                                ($ in thousands)

<TABLE>
<CAPTION>

                                   Shares of
                                    Class A        Class A      Class B       Additional                    Total
                                    Common         Common       Common        Paid-In      Retained     Stockholders'
                                     Stock         Stock         Stock         Capital      Earnings       Equity
                                     -----         -----         -----         -------      --------       ------
<S>                              <C>           <C>           <C>             <C>           <C>          <C>
Balance at December 31,
   1997                          2,124,415     $   2,124           300          13,360         1,836       17,620

Exercise of common stock
   warrants (unaudited)             12,250            12            -               73           -             85

Earnings (unaudited)                  -            -                -                -           308          308
                                 ---------     ---------     ---------       ---------     ---------    ---------

Balance at March 31,
   1998 (unaudited)              2,136,665     $   2,136           300         13,433          2,144       18,013
                                 =========     =========     =========      =========      =========    =========
</TABLE>
































See Accompanying Notes to Condensed Consolidated Financial Statements

                                        4

<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

                 Condensed Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
                                 (In thousands)
                                                                                      Three Months Ended
                                                                                           March 31,
                                                                                      ------------------
                                                                                      1998          1997
                                                                                      ----          ----
                                                                                         (unaudited)
<S>                                                                               <C>          <C>
Cash flows from operating activities:
    Net earnings                                                                   $    308         160
    Adjustments to reconcile net earnings to net cash provided by
      (used in) operating activities:
        Depreciation                                                                     83          53
        Decrease in deferred income tax asset                                            29          39
        Increase in other assets                                                        (89)        (55)
        Increase (decrease) in other liabilities                                        868        (263)
        Increase in accrued interest receivable                                        (136)       (133)
        Net amortization of fees, premiums and discounts                                  4           8
        Write-down of foreclosed real estate                                            -             8
        Provision for loan losses                                                       100          92
                                                                                   --------    --------

                Net cash provided by (used in) operating activities                   1,167         (91)
                                                                                   --------    --------

Cash flows from investing activities:
    Purchase of securities held to maturity                                         (17,568)    (13,600)
    Maturities of securities held to maturity                                        10,426       7,025
    Net purchases of premises and equipment                                            (270)       (480)
    Net increase in loans                                                            (7,691)     (5,358)
                                                                                   --------    --------

                Net cash used in investing activities                               (15,103)    (12,413)
                                                                                   --------    --------

Cash flows from financing activities:
    Net increase in demand, savings, NOW and money
        market deposits                                                               4,741       7,999
    Net increase in time deposits                                                     7,501       1,993
    Proceeds from exercise of common stock warrants                                      85         -
    Net increase in federal funds purchased                                           1,160         -
                                                                                   --------    --------

                Net cash provided by financing activities                            13,487       9,992
                                                                                   --------    --------

Net decrease in cash and cash equivalents                                              (449)     (2,512)

Cash and cash equivalents at beginning of period                                      9,176       6,320
                                                                                   --------    ---------

Cash and cash equivalents at end of period                                         $  8,727       3,808
                                                                                   ========    ========

Supplemental  disclosure of cash flow information: Cash paid during the period
    for:
        Interest                                                                   $  1,822       1,303
                                                                                   ========    ========

        Income taxes                                                               $     87         352
                                                                                   ========    ========
</TABLE>


See Accompanying Notes to Condensed Consolidated Financial Statements.

                                        5

<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

        Notes to Condensed Consolidated Financial Statements (unaudited)


1. General. In the opinion of the management of Intervest Bancshares Corporation
     (the "Holding Company"),  the accompanying condensed consolidated financial
     statements  contain  all  adjustments  (consisting  principally  of  normal
     recurring  accruals)  necessary to present fairly the financial position at
     March  31,  1998 and the  results  of  operations  and cash  flows  for the
     three-month  periods  ended  March  31,  1998  and  1997.  The  results  of
     operations  for the three months  ended March 31, 1998 are not  necessarily
     indicative of the results to be expected for the full year.

     The   Holding  Company's   condensed    consolidated  financial  statements
     include  the  accounts  of its  majority-owned  subsidiary,  Intervest Bank
     (the "Bank")  (collectively the "Company").  The Holding  Company's primary
     business  activity  is  the  ownership   of   the  Bank.  All  intercompany
     accounts   and  transactions   have   been  eliminated  in   consolidation.

2. Loan   Impairment   and  Credit  Losses.  No loans were  identified  as being
     impaired  during the three- month period ended March 31, 1998. The activity
     in the allowance for loan losses is as follows (in thousands):

                                         For the Three
                                         Months Ended
                                           March 31,
                                        --------------
                                        1998     1997
                                        ----     ----
                                        (In thousands)

Balance, beginning of period           $1,173      811
Provision charged to earnings             100       92
Recoveries, net of charge-offs              1        3
                                       ------   ------

Balance, end of period                 $1,274      906
                                       ======   ======

                                            (continued)

                                        6

<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

   Notes to Condensed Consolidated Financial Statements (unaudited), Continued


3. Earnings  Per Share.  Earnings  per share  ("EPS") of common  stock has been
     computed  on the basis of the  weighted-average  number of shares of common
     stock  outstanding.  Prior to the public stock offering in November,  1997,
     there was no public market for the Company's  common stock. For purposes of
     calculating  diluted EPS the $10 stock  offering price is assumed to be the
     market  price for the three  months  ended  March 31,  1997.  For the three
     months ended March 31, 1998 and 1997  outstanding  warrants are  considered
     dilutive  securities  for  purposes  of  calculating  diluted  EPS which is
     computed using the treasury stock method.  The following table presents the
     calculations of EPS ($ in thousands, except per share amounts).
                                                                            
<TABLE>
<CAPTION>
                                                       For the Three Months Ended March 31,
                                -------------------------------------------------------------------------------------
                                              1998                                              1997
                                ------------------------------------------  -----------------------------------------
                                  Earnings         Shares       Per Share    Earnings          Shares       Per Share
                                (Numerator)     (Denominator)     Amount    (Numerator)     (Denominator)     Amount
                                -----------     -------------     ------    -----------     -------------     ------
<S>                                  <C>           <C>             <C>          <C>            <C>             <C>
        Basic EPS:
            Net earnings
              available to
              common
              stockholders           $ 308         2,426,457       $ .13         $ 160         1,650,000       $ .10
                                                                     ===                                         ===

        Effect of dilutive
          securities-
            Incremental shares
              from assumed
              conversion
              of warrants                            846,282                                     140,450
                                                  ----------                                   ---------

        Diluted EPS:
            Net earnings available
              to common
              stockholders
              and assumed
              conversions            $ 308         3,272,739       $ .09         $ 160         1,790,450       $ .09
                                       ===         =========         ===           ===         =========         ===
</TABLE>

4. Regulatory  Capital.   The  Bank  is  required  to  maintain  certain minimum
     regulatory  capital  requirements.  The following is a summary at March 31,
     1998 of the  regulatory  capital  requirements  and the Bank's capital on a
     percentage basis:

                                                    Ratios of     Regulatory
                                                    the Bank     Requirement
                                                    --------     -----------

     Total capital to risk-weighted assets           10.90%         8.00%

     Tier I capital to risk-weighted assets           9.65%         4.00%

     Tier I capital to total assets - leverage ratio  6.15%         4.00%

                                                                 (continued)





                                        7

<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

   Notes to Condensed Consolidated Financial Statements (unaudited), Continued


5. Impact  of  New   Accounting   Principle.  On  January 1, 1998,   the Company
     adopted  Statement  of  Financial  Accounting  Standards  130  -  Reporting
     Comprehensive   Income   which   establishes    standards   for   reporting
     comprehensive  income.  The Standard  defines  comprehensive  income as the
     change in equity of an enterprise  except those resulting from  stockholder
     transactions.  All  components of  comprehensive  income are required to be
     reported  in a  new  financial  statement  that  is  displayed  with  equal
     prominence as existing  financial  statements.  The Company has no items of
     other comprehensive income therefore a statement of comprehensive income is
     not presented.





                                        8

<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

                  Item 2. Management's Discussion and Analysis
                              or Plan of Operation

               Comparison of March 31, 1998 and December 31, 1997

Liquidity and Capital Resources
    The Company's primary source of cash during the three months ended March 31,
    1998 was from the  maturity of  securities  totaling  $10.4  million and net
    deposit  inflows  of $12.2  million.  Cash was used  primarily  for net loan
    originations  of $7.7 million and the purchase of securities  totaling $17.6
    million.  At March 31,  1998,  the Company had  outstanding  commitments  to
    originate loans of $3.3 million. It is expected that these requirements will
    be funded from the sources  described  above.  At March 31,  1998,  the Bank
    exceeded its regulatory liquidity requirements.

    The Company recently  registered $6.0 million aggregate  principal amount of
    convertible  subordinated  debentures due July 1, 2008. The offering relates
    to a minimum of $5.0  million and a maximum of $6.0  million of  debentures.
    The estimated  net proceeds to the Company from the sale of the  debentures,
    after deducting commissions and estimated offering expenses, is estimated to
    be  approximately   $5.4  million,   if  the  maximum  amount  is  sold,  or
    approximately $4.5 million,  if the minimum amount is sold. The net proceeds
    of that  offering  will become a part of the  Company's  capital funds to be
    used for general corporate  purposes,  including,  without  limitation,  the
    financing of the expansion of the Company's or the Bank's  business  through
    acquisitions,  the  establishment of new branches or  subsidiaries,  and the
    infusion of capital to the Bank and any future subsidiaries of the Bank. The
    Company is  presently in the process of  preparing  an  application  for the
    chartering  of  a  de  novo  national  bank,  which  is  expected  to  be  a
    wholly-owned  subsidiary of the Company, with a principal office in the City
    of New York and with initial capital of approximately $7.5 million.

    The following  table shows  selected  ratios for the periods ended or at the
dates indicated:
<TABLE>
<CAPTION>

                                                                   Three Months                      Three Months
                                                                      Ended           Year Ended         Ended
                                                                     March 31,       December 31,       March 31,
                                                                        1998            1997              1997
                                                                    -------------   --------------   -------------
<S>                                                                     <C>             <C>                <C>
        Average equity as a percentage
           of average assets                                            11.11%            8.96%            8.95%

        Equity to total assets at end of period                         10.89%           11.69             8.61%

        Return on average assets (1)                                      .77%             .68%             .57%

        Return on average equity (1)                                     6.94%            7.53%            6.32%

        Noninterest expense to average assets (1)                        1.27%            1.52%            1.63%

        Nonperforming loans and foreclosed real estate to
           total assets at end of period                                 -   %            -   %             .15%
</TABLE>

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

        (1)     Annualized for the three months ended March 31, 1998 and 1997.


                                        9

<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

            Comparison of the Quarters Ended March 31, 1998 and 1997

Results of Operations:
   General. Net earnings for the three months ended March 31, 1998 were $308,000
      or $.13  basic  earnings  per share  ($.09  diluted  earnings  per  share)
      compared to net  earnings of  $160,000  or $.10 basic  earnings  per share
      ($.09  diluted  earnings  per share) for the three  months ended March 31,
      1997.  This increase in the Company's net earnings was primarily due to an
      increase  in net  interest  income,  partially  offset by an  increase  in
      noninterest expenses and the provision for income taxes.

   Interest  Income and Expense.  Interest  income  increased  by $822,000  from
      $2,085,000 for the three months ended March 31, 1997 to $2,907,000 for the
      three  months  ended March 31, 1998.  Interest  income on loans  increased
      $374,000  primarily  due to an  increase  in the  average  loan  portfolio
      balance  for the  three  months  ended  March  31,  1998 to $79.5  million
      compared to $63.4 million  during the 1997 period.  Interest on securities
      increased  $431,000 primarily due to an increase in the average securities
      portfolio  during the three months  ended March 31, 1998 to $67.0  million
      from  $40.7   million   during  the  1997   period.   Interest   on  other
      interest-earning  assets  increased  $17,000  due  to an  increase  in the
      average balance of other interest earning assets from 1997 to 1998.

      Interest expense on deposit accounts increased to $1,838,000 for the three
      months  ended March 31, 1998 from  $1,309,000  for the three  months ended
      March 31, 1997.  Interest expense on deposits increased due to an increase
      in the average balance and in the weighted average rate from 1997 to 1998.
      The average  balance for the three  months ended March 31, 1998 was $136.2
      million  compared to $98.5  million  during 1997 and the weighted  average
      rate was 5.4% in 1998 compared to 5.3% in 1997.

   Provision  for Loan  Losses.  The  provision  for loan  losses is  charged to
      earnings to bring the total  allowance  to a level deemed  appropriate  by
      management and is based upon historical experience, the volume and type of
      lending  conducted  by the  Company,  industry  standards,  the  amount of
      nonperforming  loans,  general economic  conditions,  particularly as they
      relate to the  Company's  market areas,  and other factors  related to the
      collectibility  of the Company's loan portfolio.  The provision  increased
      from $92,000 for the three months ended March 31, 1997 to $100,000 for the
      three months ended March 31, 1998. The increase was deemed  appropriate by
      management due to the growth in the loan portfolio during the three months
      ended March 31, 1998. Management believes the balance in the allowance for
      loan losses of $1,274,000 at March 31, 1998 is adequate.

   Noninterest Income.  Customer service charges increased $19,000 for the three
      months ended March 31, 1998 compared to the same period in 1997  primarily
      due to the overall growth of the Company's deposits.

   Noninterest  Expenses.   Total  noninterest  expenses  increased  $48,000  to
      $509,000 for the three  months ended March 31, 1998 from  $461,000 for the
      three  months  ended  March 31,  1997,  primarily  due to an  increase  in
      employee  compensation and benefits and other expenses associated with the
      overall growth of the Company.

   Provision for Income  Taxes.  The income tax  provision  for the three months
      ended March 31, 1998 was $202,000 (an effective rate of 39.6%) compared to
      $94,000 (an effective  rate of 36.9%) for the comparable  1997 period.  In
      1998, a greater portion of the consolidated  earnings was generated by the
      Holding Company which has a higher state income tax rate.



                                       10

<PAGE>


                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

                           PART II. OTHER INFORMATION


                    Item 6. Exhibits and Reports on Form 8-K

(a)  Exhibits (numbered in accordance with Item 601 of Regulation S-B)

           27. Financial Data Schedule (for SEC use only)

(b)  No reports on Form 8-K were filed during the period covered by this report.


                                           INTERVEST BANCSHARES CORPORATION
                                             AND SUBSIDIARY
                                             (Registrant)






Date: May 14, 1998               By:  /s/ Lowell S. Dansker
      ---------------------           ------------------------------------------
                                      Lowell S. Dansker, President and Treasurer
                                      (Chief Financial Officer)




Date: May 14, 1998               By:  /s/ Lawrence G. Bergman
      ---------------------           ------------------------------------------
                                      Lawrence G. Bergman, Vice President and 
                                      Secretary





                                       11

<PAGE>