-------------------------------------------------------------------------------
                     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 September 30, 1996

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

For the transition period from _________  to ___________

Commission file number 33-82246
                       --------

                        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             900,000
----------------------------------------------      ----------------------
                         (class)                Outstanding at October 23, 1996


Class B Common stock, par value $1.00 per share            200,000
-----------------------------------------------     ----------------------
                         (class)                Outstanding at October 23, 1996





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

                                                                  CONFORMED COPY


<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

                                      INDEX


Part I. Financial Information

   Item 1. Financial Statements                                            Page

     Condensed Consolidated Balance Sheets -
       September 30, 1996 (unaudited) and December 31, 1995...................2

     Condensed Consolidated Statements of Earnings -
       Three and Nine Months ended September 30, 1996 and 1995 (unaudited)....3

     Condensed Consolidated Statement of Stockholders' Equity -
       Nine Months Ended September 30, 1996 (unaudited).......................4

     Condensed Consolidated Statements of Cash Flows -
       Nine months ended September 30, 1996 and 1995 (unaudited)..............5

     Notes to Condensed Consolidated Financial Statements (unaudited).......6-7

   Item 2. Management's Discussion and Analysis of Financial Condition
     and Results of Operations.............................................8-10

Part II. Other Information

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

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



                                        1

<PAGE>
<TABLE>
<CAPTION>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

                          PART I. FINANCIAL INFORMATION

                          Item 1. Financial Statements

                      Condensed Consolidated Balance Sheets
                                 (In thousands)

                                                                                        September 30,      December 31,
    Assets                                                                                  1996                1995
                                                                                            ----                ----
                                                                                        (unaudited)
<S>                                                                                          <C>                 <C>   
Cash and cash equivalents:
    Cash and due from banks                                                                  $  1,837             1,805
    Federal funds sold                                                                          2,326             5,707
    Investment securities, short-term                                                             513             1,039
                                                                                              -------            ------

            Total cash and cash equivalents                                                     4,676             8,551
                                                                                               ------            ------

Interest-bearing deposits with banks                                                               99               298
Investment securities held-to-maturity, at cost                                                29,189            19,630
Loans, net                                                                                     54,257            36,465
Premises and equipment, net                                                                     2,492             2,449
Federal Reserve Bank stock, at cost                                                               203               203
Deferred income tax assets                                                                        468               593
Accrued income and other assets                                                                   842               753
                                                                                              -------           -------

            Total                                                                            $ 92,226            68,942
                                                                                             ========            ======

    Liabilities and Stockholders' Equity

Deposits:
    Demand deposits                                                                             2,614             2,729
    NOW deposits                                                                                3,897             2,705
    Money market deposits                                                                       4,068             3,518
    Savings deposits                                                                            1,978               595
    Other time deposits                                                                        66,892            49,054
                                                                                               ------            ------

            Total deposits                                                                     79,449            58,601

Advance payments by borrowers for taxes and insurance                                           1,374               194
Other liabilities                                                                               1,504               613
                                                                                               ------          --------

            Total liabilities                                                                  82,327            59,408
                                                                                               ------            ------

Minority interest                                                                                 319               345
                                                                                               ------           -------

Stockholders' Equity:
    Class A common stock                                                                          900               900
    Class B common stock                                                                          200               200
    Additional paid-in capital                                                                  7,655             7,655
    Retained earnings                                                                             825               434
                                                                                               ------           -------

            Total stockholders' equity                                                          9,580             9,189
                                                                                               ------           -------

            Total                                                                            $ 92,226            68,942
                                                                                             ========            ======











See Accompanying Notes to Condensed Consolidated Financial Statements.
</TABLE>

                                        2

<PAGE>
<TABLE>
<CAPTION>



                                    INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

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

                                                                   Three Months Ended           Nine Months Ended
                                                                       September 30,              September 30,
                                                                   ------------------           -----------------
                                                               1996            1995             1996            1995
                                                               ----            ----             ----            ----
                                                                        (unaudited)                  (unaudited)
Interest income:
<S>                                                          <C>            <C>             <C>             <C>      
    Loans                                                    $     1,193          742           3,280           2,016
    Investment securities                                            394          285           1,069             779
    Federal funds sold                                                49           46             141             116
    Deposits in banks                                                  1            7               4              16
                                                             -----------  -----------     -----------     -----------

            Total interest income                                  1,637        1,080           4,494           2,927
                                                             -----------  -----------     -----------     -----------

Interest expense:
    Deposits                                                         975          579           2,601           1,512
    Short term borrowings                                            -            -                 2               1
                                                             -----------  -----------     -----------     -----------

            Total interest expense                                   975          579           2,603           1,513
                                                             -----------  -----------     -----------     -----------

            Net interest income                                      662          501           1,891           1,414

Provision for credit losses                                           62           66             190             171
                                                             -----------  -----------     -----------     -----------

            Net interest income after
                provision for credit losses                          600          435           1,701           1,243
                                                             -----------  -----------     -----------     -----------

Other income:
    Customer service charges                                          24           26              84              61
    Miscellaneous                                                      -            -              18               6
                                                             -----------  -----------     -----------     -----------

            Total other income                                        24           26             102              67
                                                             -----------  -----------     -----------     -----------

Other expense:
    Employee compensation and benefits                               187          149             538             415
    Occupancy and equipment                                           77          102             256             274
    Advertising and promotion                                          2            2               5              10
    Professional fees                                                 34           35             121             100
    Federal insurance premiums                                         1           22               2              57
    Miscellaneous                                                     73           56             217             170
                                                             -----------  -----------     -----------     -----------

            Total other expense                                      374          366           1,139           1,026
                                                             -----------  -----------     -----------     -----------

Earnings before income taxes                                         250           95             664             284

Provision for income taxes                                           101           32             273              95
                                                             -----------  -----------     -----------     -----------

Net earnings                                                  $      149           63             391             189
                                                              ==========  ===========      ==========       =========

Earnings per share                                            $      .14          .06             .36             .17
                                                              ===========   =========       =========       =========

Weighted average number of shares outstanding                  1,100,000    1,100,000       1,100,000       1,100,000
                                                               =========    =========       =========       =========



See Accompanying Notes to Condensed Consolidated Financial Statements.
</TABLE>

                                        3

<PAGE>
<TABLE>
<CAPTION>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

            Condensed Consolidated Statement of Stockholders' Equity

               For the Nine-Month Period Ended September 30, 1996
                                 (In thousands)



                                                           Class A       Class B       Additional                    Total
                                                            Common        Common        Paid-In      Retained   Stockholders'
                                                            Stock         Stock         Capital      Earnings       Equity
                                                            -----         -----         -------      --------       ------

<S>                                                        <C>             <C>             <C>           <C>         <C>  
Balance, December 31, 1995                                 $ 900           200             7,655         434         9,189

Net earnings for the nine months
         ended September 30, 1996
         (unaudited)                                           -             -               -           391           391
                                                            ----         -----            ------         ---         -----

Balance, September 30, 1996
         (unaudited)                                       $ 900           200             7,655         825         9,580
                                                           =====           ===             =====         ===         =====
                                                                           


See Accompanying Notes to Condensed Consolidated Financial Statements








</TABLE>

                                        4

<PAGE>
<TABLE>
<CAPTION>



                                           INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

                                           Condensed Consolidated Statements of Cash Flows
                                                           (In thousands)

                                                                                                           Nine Months Ended
                                                                                                             September 30,
                                                                                                         1996            1995
                                                                                                         ----            ----
                                                                                                              (unaudited)
Cash flows from operating activities:
<S>                                                                                                   <C>                <C>  
      Net earnings                                                                                    $    391             189
      Adjustments to reconcile net earnings to net cash provided by
            (used in) operating activities:
          Depreciation                                                                                     171             112
          Provision for deferred taxes                                                                     125              95
          Decrease (increase) in other assets                                                               12            (13)
          Increase in accrued interest payable                                                              30              29
          Increase in other liabilities                                                                    151             725
          Increase (decrease) in official checks                                                           684           (289)
          Increase in accrued interest receivable                                                         (101)          (214)
          Net amortization of fees, premiums and discounts                                                 184             28
          Provision for credit losses                                                                      190             171
                                                                                                       -------         -------

                 Net cash provided by operating activities                                               1,837             833
                                                                                                       -------         -------

Cash flows from investing activities:
      Purchase of investment securities                                                                (21,443)        (14,177)
      Purchase of premises and equipment                                                                  (178)         (1,167)
      Loans originated net of principal collected                                                      (18,068)         (7,481)
      Maturities of investment securities                                                               11,750           6,100
      Purchase of Federal Reserve Bank stock                                                              -                (31)
      Maturity of interest-bearing deposits                                                                199              99
                                                                                                       -------         -------

                 Net cash used in investing activities                                                 (27,740)        (16,657)
                                                                                                        ------          ------

Cash flows from financing activities:
      Net increase in deposits                                                                          20,848          18,268
      Stock issuance costs                                                                                 -               (13)
      Increase in advance payments by borrowers for taxes and insurance                                  1,180             344
                                                                                                        ------         -------

                 Net cash provided by financing activities                                              22,028          18,599

Net (decrease) increase in cash and cash equivalents                                                    (3,875)          2,775

Cash and cash equivalents at beginning of period                                                         8,551           6,088
                                                                                                        ------         -------

Cash and cash equivalents at end of period                                                            $  4,676           8,863
                                                                                                        ======          ======

Supplemental  disclosure of cash flow  information:  Cash paid during the period
      for:
          Interest                                                                                    $  2,573           1,484
                                                                                                        ======         =======

          Income taxes                                                                                $     32              -
                                                                                                        ======         ========

See Accompanying Notes to Condensed Consolidated Financial Statements.
</TABLE>

                                        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  September  30,  1996,  the  results  of
          operations  for the three and nine-month  periods ended  September 30,
          1996 and 1995 and the cash flows for the  nine-months  ended September
          30, 1996 and 1995.  The results of  operations  for the three and nine
          months ended September 30, 1996 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.       The Company has identified  loans
          totaling  $246,000 as impaired at September  30, 1996 and has recorded
          an  allowance  of  $61,000  relating  to these  loans.  No loans  were
          identified as impaired at September 30, 1995.
<TABLE>
<CAPTION>

          The activity in the allowance for credit losses is as follows:

                                                                               For the Three                 For the Nine
                                                                               Months Ended                  Months Ended
                                                                               September 30,                 September 30,
                                                                               -------------                 -------------
                                                                           1996         1995            1996        1995
                                                                           ----         ----            ----        ----
                                                                                            (In thousands)

<S>                                                                       <C>            <C>              <C>          <C>
              Balance, beginning of period                                $ 752          478              593          369
              Provision charged to earnings                                  62           66              190          171
              Charge-offs, net of recoveries                                  1          (15)              32          (11)
                                                                           ----          ---             ----          ---
              Balance, end of period                                      $ 815          529              815          529
                                                                            ===          ===              ===          ===
</TABLE>

3.   Earnings Per Common Share.       Earnings per common share were computed by
          dividing  the net  earnings  for the  period by the  weighted  average
          number of shares outstanding.  The effect of the outstanding  warrants
          was not material.

4.   Regulatory  Capital.       The Bank is required to maintain certain minimum
          regulatory  capital  requirements.  The  following  is  a  summary  at
          September  30, 1996 of the  regulatory  capital  requirements  and the
          Bank's capital on a percentage basis:

<TABLE>
<CAPTION>
                                                                                   Ratios of      Regulatory
                                                                                    the Bank      Requirement
                                                                                    --------      -----------

              <S>                                                                   <C>              <C>  
              Total capital to risk-weighted assets                                 12.98%           8.00%

              Tier I capital to risk-weighted assets                                11.73%           4.00%

              Tier I capital to total assets - leverage ratio                        8.67%           4.00%





</TABLE>

                                        6

<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

   Notes to Condensed Consolidated Financial Statements (unaudited), Continued


5.   Impact of New  Accounting  Issues.       On January 1,  1996,  the  Company
          adopted Statement of Financial Accounting Standards No. 122 ("SFAS No.
          122"),  which  requires  mortgage  banking  enterprises  that  acquire
          mortgage  servicing  through  either the  purchase or  origination  of
          mortgage  loans and sells or  securitizes  those loans with  servicing
          retained  to  allocate  the total  cost of the  mortgage  loans to the
          mortgage  servicing  rights and the loans based on their relative fair
          values.  Mortgage  banking  enterprises  include  commercial banks and
          thrift institutions that conduct operations  substantially  similar to
          the primary operations of a mortgage banking enterprise.  The adoption
          of SFAS No. 122 had no effect on the Company's  financial  position at
          September 30, 1996 or results of  operations  for the nine months then
          ended.  Although this Statement will be superseded  effective December
          31,  1996  by  SFAS  125  discussed  below  under  "Future  Accounting
          Requirements,"  the major  provisions of SFAS 122 discussed  above are
          included in SFAS 125.

          On  January  1, 1996,  the  Company  adopted  Statement  of  Financial
          Accounting    Standards   No.   123,   "Accounting   for   Stock-Based
          Compensation" ("SFAS No. 123"), which establishes financial accounting
          and reporting standards for stock-based  employee  compensation plans.
          The  Statement   requires  certain   disclosures   about   stock-based
          compensation  arrangements,  regardless  of the method used to account
          for them,  and defines a fair value based method of accounting  for an
          employee stock option or similar equity  instrument and encourages all
          entities to adopt that method of accounting  for all of their employee
          stock compensation plans.  However, SFAS No. 123 also allows an entity
          to continue to measure compensation cost for stock-based  compensation
          plans using the intrinsic value method of accounting prescribed by APB
          Opinion No. 25,  "Accounting for Stock Issued to Employees."  Entities
          electing to continue using the accounting method in APB Opinion No. 25
          must make pro forma disclosures of net earnings and earnings per share
          as if the fair value method of accounting  defined in SFAS No. 123 had
          been  applied.  Under  the fair  value  method,  compensation  cost is
          measured  at the  grant  date  based on the  value of the award and is
          recognized  over the  service  period,  which is usually  the  vesting
          period.  Under the intrinsic  value method,  compensation  cost is the
          excess,  if any, of the quoted market price of the stock at grant date
          or other  measurement  date over the  amount an  employee  must pay to
          acquire the stock.  The Company had elected to continue to utilize the
          intrinsic  value method of  accounting  defined in APB Opinion No. 25,
          and  accordingly,  the  adoption  of SFAS No. 123 had no effect on the
          Company's  financial  position  at  September  30,  1996 or results of
          operations for the nine months then ended.  The pro forma  disclosures
          required under SFAS No. 123, for stock  warrants  granted to employees
          during 1995 and  thereafter,  are not required  for interim  condensed
          financial statements.

6.   Future  Accounting  Requirements.       Statement of  Financial  Accounting
          Standards No. 125 "Accounting for Transfers and Servicing of Financial
          Assets and  Extinguishments  of  Liabilities"  ("SFAS  125")  provides
          accounting  and  reporting  standards  for  transfers and servicing of
          financial assets and  extinguishments  of liabilities.  This Statement
          also provides  consistent  standards for  distinguishing  transfers of
          financial  assets  that are  sales  from  transfers  that are  secured
          borrowings.  SFAS 125 is  effective  for  transfers  and  servicing of
          financial assets and  extinguishments  of liabilities  occurring after
          December 31, 1996.  Management of the Company does not expect SFAS 125
          to have a material effect on the Company's financial statements.



                                        7

<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

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

             Comparison of September 30, 1996 and December 31, 1995

Liquidity and Capital Resources
         The  Company's  primary  source of cash  during the nine  months  ended
         September  30,  1996 was from the  maturity  of  investment  securities
         totaling  $11.8 million,  net deposit  inflows of $20.8 million and net
         cash provided by operating  activities  of $1.8 million.  Cash was used
         primarily for net loan  originations  of $18.1 million and the purchase
         of investment securities totaling $21.4 million. At September 30, 1996,
         the Company had  outstanding  commitments  to  originate  loans of $5.9
         million. It is expected that these requirements will be funded from the
         sources  described  above. At September 30, 1996, the Bank exceeded its
         regulatory liquidity requirements.

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

                                                                                Nine Months                   Nine Months
                                                                                  Ended         Year Ended      Ended
                                                                              September 30,    December 31,  September 30,
                                                                                  1996           1995             1995
                                                                             -------------- ---------------  ---------
<S>                                                                              <C>              <C>              <C>   
              Average equity as a percentage
                 of average assets                                               12.03%           16.89%           18.36%

              Equity to total assets at end of period                            10.39%           13.33%           15.32%

              Return on average assets (1)                                         .66%             .51%             .51%

              Return on average equity (1)                                        5.49%            3.01%            2.79%

              Noninterest expense to average assets (1)                           1.92%            2.66%            2.78%

              Nonperforming loans and real estate owned to
                 total assets at end of period                                     .27%             -  %             .06%

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

              (1)     Annualized for the nine months ended September 30, 1996 and 1995.

</TABLE>

                                        8

<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

     Comparison of the Three-Month Periods Ended September 30, 1996 and 1995

Results of Operations:
   
General.  Net  earnings  for the three  months  ended  September  30,  1996 were
    $149,000 or $.14 per share  compared to net  earnings of $63,000 or $.06 per
    share for the three months ended  September  30, 1995.  This increase in the
    Company's  net  earnings  was  primarily  due to an increase in net interest
    income, partially offset by an increase in the provision for income taxes.

Interest Income and Expense.  Interest  income  increased by $557,000  from $1.1
    million for the three  months ended  September  30, 1995 to $1.6 million for
    the  three  months  ended  September  30,  1996.  Interest  income  on loans
    increased  $451,000 due to an increase in the average loan portfolio balance
    for the three months ended  September 30, 1996 to $52.0 million  compared to
    $27.8 million during the 1995 period  partially  offset by a decrease in the
    weighted  average  yield from  10.67% in 1995 to 9.18% in 1996.  Interest on
    investment  securities  increased $109,000 due to an increase in the average
    investment  securities portfolio during the three months ended September 30,
    1996 to $25.7 million from $17.8 million during 1995  partially  offset by a
    decrease in the weighted  average yield from 6.54% in 1995 to 6.17% in 1996.
    Interest on federal funds sold and other  interest-earning  assets decreased
    $3,000 due to a decrease in the average  balance of such assets from 1995 to
    1996.

    Interest  expense on deposit  accounts  increased  to $975,000 for the three
    months  ended  September  30, 1996 from  $579,000 for the three months ended
    September  30, 1995.  Interest  expense  increased  primarily  because of an
    increase in the average  balance from 1995 to 1996. The average  balance for
    the three  months ended  September  30, 1996 was $71.1  million  compared to
    $41.3 million during 1995.

Provision for Credit  Losses.  The  provision  for  credit  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 for the three
    months  ended   September  30,  1996  and  1995  was  $62,000  and  $66,000,
    respectively.

Other Expense.  Total other expense  increased  $8,000 to $374,000 for the three
    months  ended  September  30, 1996 from  $366,000 for the three months ended
    September  30, 1995,  primarily due to a decrease in occupancy and equipment
    expenses and federal insurance premiums,  partially offset by an increase in
    employee compensation and benefits.  The decrease in occupancy and equipment
    expense is due to an increase in income from the leasing of space in Company
    buildings  to third  parties.  The  increase  in employee  compensation  and
    benefits is due to additional personnel for the new branches.

Provision for Income Taxes.  The income tax provision for the three months ended
    September  30, 1996 was $101,000 (an  effective  rate of 40.4%)  compared to
    $32,000 (an effective rate of 33.7%) for the comparable  period in 1995. The
    increased  rate is  primarily  due to an  increase  in net  earnings  of the
    Holding  Company  which is taxed at a higher state income tax rate than that
    of the Bank.





                                        9

<PAGE>



                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

     Comparison of the Nine-Month Periods Ended September 30, 1996 and 1995

Results of Operations:

General. Net earnings for the nine months ended September 30, 1996 were $391,000
    or $.36 per share compared to net earnings of $189,000 or $.17 per share for
    the nine months ended September 30, 1995. This increase in the Company's net
    earnings was primarily due to an increase in net interest income,  partially
    offset by an increase in other expenses and an increase in the provision for
    income taxes.

Interest Income and Expense.  Interest income  increased by $1,567,000 from $2.9
    million for the nine months ended September 30, 1995 to $4.5 million for the
    nine months ended  September 30, 1996.  Interest  income on loans  increased
    $1,264,000 due to an increase in the average loan portfolio  balance for the
    nine months  ended  September  30, 1996 to $46.3  million  compared to $25.8
    million  during  the 1995  period  partially  offset  by a  decrease  in the
    weighted  average  yield from  10.42% in 1995 to 9.45% in 1996.  Interest on
    investment  securities  increased $290,000 due to an increase in the average
    investment  securities  portfolio during the nine months ended September 30,
    1996 to $23.7 million from $16.3 million during 1995  partially  offset by a
    decrease in the weighted  average yield from 6.37% in 1995 to 6.03% in 1996.
    Interest on federal funds sold and other  interest-earning  assets increased
    $13,000 due to an increase in the average  balance of these assets from 1995
    to 1996, as well as an increase in the weighted average yield.

    Interest  expense on deposit  accounts  increased to $2,601,000 for the nine
    months ended  September 30, 1996 from  $1,512,000  for the nine months ended
    September  30, 1995.  Interest  expense  increased due to an increase in the
    average balance  partially offset by a decrease in the weighted average rate
    from 1995 to 1996. The average  balance for the nine months ended  September
    30, 1996 was $64.5  million  compared to $37.2  million  during 1995 and the
    weighted average rate was 5.38% in 1996 compared to 5.42% in 1995.

Provision for Credit  Losses.  The  provision  for  credit  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
    $171,000  for the nine months ended  September  30, 1995 to $190,000 for the
    nine months ended September 30, 1996. The increase was deemed appropriate by
    management due to the growth in the loan portfolio in 1996.

Other Expense.  Total other expense  increased  $113,000 to $1.1 million for the
    nine months ended  September  30, 1996 from $1.0 million for the nine months
    ended  September  30,  1995,  primarily  due  to  an  increase  in  employee
    compensation  and benefits  related to the opening of two branch  offices in
    March, 1995 and a branch office in September, 1995.

Provision for Income  Taxes.  The income tax provision for the nine months ended
    September  30, 1996 was $273,000 (an  effective  rate of 41.1%)  compared to
    $95,000 (an effective  rate of 33.5%) for the  comparable  1995 period.  The
    increased  rate is  primarily  due to an  increase  in net  earnings  of the
    Holding  Company  which is taxed at a higher state income tax rate than that
    of the Bank.





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                 INTERVEST BANCSHARES CORPORATION AND SUBSIDIARY

                           PART II. OTHER INFORMATION


                    Item 6. Exhibits and Reports on Form 8-K

There were no reports on Form 8-K filed for the three months ended September 30,
1996.


                                   SIGNATURES



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


                                      INTERVEST BANCSHARES CORPORATION
                                       AND SUBSIDIARY
                                       (Registrant)






Date:       October 23, 1996             By:     /s/ Lowell S. Dansker
           ------------------------              ----------------------
                                                 Lowell S. Dansker, President
                                                    and Treasurer
                                                   (Chief Financial Officer)




Date:       October 23, 1996             By:     /s/ Lawrence G. Bergman
           ----------------------                ------------------------
                                                 Lawrence G. Bergman,
                                                  Vice President and Secretary






                                       11

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