<PAGE>


                     U.S. Securities and Exchange Commission
                                Washington, D.C.

                                   Form 10-Q


              [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                   For the quarterly period ended June 30,1998

             [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
                                  EXCHANGE ACT

                   For the transition period to


                 Commission file number 0-27474
  

                            American Bancshares, Inc.
                (Exact Name of Registrants Specified in its Charter)


                 Florida                             65-0624640
        (State or other Jurisdiction            (IRS Emloyer Id. No.)
        Incorporation or Organization)

                 4702 Cortez Road West, Bradenton, Florida 34210
                      (Address of Principal Executive Offices)

                                 (941) 795-3050
                (Registrants telephone number including area code)


              ----------------------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report)



Check  whether  the issuer  has(1)  filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Securities  Exchange  Act of 1934 during the past 12
months (or for 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    .
            ---   ---

Number of shares outstanding of the issuer's Common Stock, par value $1.175 as
of June 30,1998: 4,994,984 shares.
<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

                                                                         Page
<S>       <C>                                                          <C>
Part I    FINANCIAL INFORMATION

          Item 1
               -Financial Statements                                     1-4

               -Notes to Consolidated Condensed Financial Statements     5-7

          Item 2
               -Management's Discussion and Analysis
                of Financial Condition and Results of
                Operations                                               8-9

          Item 3   
               -Quantitative and Qualitative Disclosure                    9
                About Market Risk                                        

Part II   OTHER INFORMATION

          Item 1     Legal Proceedings                                    10


          Item 2     Changes in Securities                                10


          Item 3     Defaults Upon Senior Securities
                     (Not applicable)                                    n/a

          Item 4     Submission of Matters to a Vote
                     of Security Holders                               10-11


          Item 5     Other Information                                    11


          Item 6     Exhibits and Reports on Form 8-K                     12
</TABLE>
<PAGE>


PART 1 - FINANCIAL INFORMATION


ITEM 1.  FINANCIAL STATEMENTS

American Bancshares, Inc. and Subsidiaries
Consolidated Condensed Balance Sheets
(unaudited, $ in thousands)
<TABLE>
<CAPTION>

                                                     June 30,    December 31,     %          $
Assets                                                 1998         1997        Change     Change
                                                    ---------    ------------  --------  -----------
<S>                                                 <C>          <C>          <C>       <C>
  Cash and due from banks                              13,484        9,549        41.21       3,935
  Federal funds sold                                        0        5,120      (100.00)     (5,120)
  Interest bearing deposits in banks                      591        3,727       (84.14)     (3,136)
  Mortgage loans held for sale                         82,473       39,588       108.33      42,885
  Investment securities, available for sale            54,958       62,898       (12.62)     (7,940)
  Mortgage-backed securities, available for sale        1,143        5,766       (80.18)     (4,623)
  Loans (net of allowance for credit losses and
   deferred loan fees of $1,486,760 as of
   June 30, 1998 and $1,704,529 as of
   December 31, 1997)                                 218,777      213,404         2.52       5,373
  Premises and equipment, net                          11,570        9,161        26.30       2,409
  Other real estate owned, net                            409          363        12.67          46
  Goodwill                                                 77           80        (3.75)         (3)
  Other assets                                          6,794        4,245        60.05       2,549
                                                    ---------    ---------      --------    --------
  Total assets                                        390,276      353,901        10.28      36,375
                                                    =========    =========      ========    ========

Liabilities and shareholders' equity

Liabilities
  Deposits                                            317,019      302,746         4.71      14,273
  Securities sold under agreements to repurchase       29,067       17,528        65.83      11,539
  Federal funds purchased and FHLB borrowings          11,000        5,000       120.00       6,000
 Other Borrowed Money                                   3,001          500       500.20       2,501
 Other liabilities                                      3,581        2,048        74.85       1,533
                                                    ---------    ---------      --------   ---------
    Total liabilities                                 363,668      327,822        10.93      35,846

Shareholders' equity
  Preferred stock, par value not determined,     
   5,000,000 shares authorized, 0 shares issued
   and outstanding as of  June 30, 1998.                    0         n/a             0           0 

  Common stock, $1.175 par value, 20,000,000 shares 
   authorized, 4,994,984 shares issued and 
   outstanding as of June 30, 1998 and 4,994,484
   as of December 31, 1997                              5,870        5,870          0.00           0
  Additional paid in capital                           15,551       15,547          0.03           4
  Accumulated other comprehensive income, net              68          140        (51.43)        (72)
  Retained earnings                                     5,119        4,522         13.20         597
                                                    ---------    ---------      ---------    --------
    Total shareholders' equity                         26,608       26,079          2.03         529
                                                    ---------    ---------      ---------    --------
Total liabilities and shareholders' equity            390,276      353,901         10.28      36,375
                                                    =========    =========      =========    ========

</TABLE>

The accompanying notes are an integral part of these financial statements.

                                     Page 1
<PAGE>
 American Bancshares, Inc. and Subsidiaries
 Consolidated Condensed Statements of Income
 (unaudited, $ in thousands)
<TABLE>
<CAPTION>
                                                     Three Month's Ended June 30,       %             $
                                                         1998           1997          Change        Change
                                                      -----------    -----------    ----------   -----------
<S>                                                   <C>            <C>            <C>          <C>
Interest income
  Interest and fees on loans                               6,474           4,908        31.91         1,566
  Interest on mortgage backed securities, taxable             24             189       (87.30)         (165)
  Interest on investment securities, taxable                 909             823        10.45            86
  Interest on investment securities, nontaxable               32              17        88.24            15
  Other interest income                                       43              64       (32.81)          (21)
                                                        --------        --------     ---------      ---------
    Total interest income                                  7,482           6,001        24.68         1,481

Interest expense
  Deposits                                                 3,248           2,839        14.41           409
  Securities sold under agreements to repurchase             316             148       113.51           168
  Federal funds purchased and FHLB advances                  110             112        (1.79)           (2)
  Other borrowed money                                         1               0       100.00             1
                                                        --------        --------     ---------      ---------
    Total interest expense                                 3,675           3,099        18.59           576

Net interest income                                        3,807           2,902        31.19           905
Provision for loan losses                                    151             355       (57.46)         (204)
                                                        --------        --------     ---------      ---------
Net interest income after loan loss                        3,656           2,547        43.54         1,109

Noninterest income
  Service charges & fees                                     454             416         9.13            38
  Gain on sale of mortgage loans                              44              26        69.23            18
  Gain on sale of securities                                   6               2       200.00             4
  Gain on sale of servicing                                   50             219       (77.17)         (169)
  Broker loan fees                                            34              86       (60.47)          (52)
  Originated mortgage servicing rights                       204              32       537.50           172
  Merchant fees                                              205             134        52.99            71
  Other income                                               175             153        14.38            22
                                                        --------        --------     ---------      --------
    Total noninterest income                               1,172           1,068         9.74           104

Noninterest expense
  Salaries & employee benefits                             1,759           1,245        41.29           514
  Net occupancy expense                                      223             154        44.81            69
  Furniture and equipment expenses                           211             231        (8.66)          (20)
  Data processing fees                                       135             122        10.66            13
  Legal fees                                                 253              49       416.33           204
  Litigation settlement                                      525               0       100.00           525
  Other expense                                            1,425             960        48.44           465
                                                        --------        --------     --------       --------
    Total noninterest expense                              4,531           2,761        64.11         1,770

Income before income taxes                                   297             854       (65.22)         (557)
Provision for income taxes                                   104             289       (64.01)         (185)
                                                        --------        --------     ---------      ---------
Net income                                                   193             565       (65.84)         (372)
                                                        ========        ========     =========      =========
Earnings per share (actual $'s)
   Basic                                                    0.04            0.11
   Diluted                                                  0.04            0.11

Average Number of shares outstanding
   Basic                                               4,994,599       4,994,484
   Diluted                                             5,024,054       5,005,330

</TABLE>

The accompanying notes are an integral part of these financial statements.

                                     Page 2
<PAGE>
 American Bancshares, Inc. and Subsidiaries
 Consolidated Condensed Statements of Income
 (unaudited, $ in thousands)
<TABLE>
<CAPTION>
                                                       Six Months ended June 30,        %             $
                                                         1998           1997          Change        Change
                                                      -----------    -----------    ----------   -----------
<S>                                                   <C>            <C>            <C>          <C>
Interest income
  Interest and fees on loans                              12,285          9,361          31.24        2,924
  Interest on mortgage backed securities, taxable            122            410         (70.24)        (288)
  Interest on investment securities, taxable               1,941          1,536          26.37          405
  Interest on investment securities, nontaxable               49             33          48.48           16
  Other interest income                                      186            213         (12.68)         (27)
                                                       ---------       ---------       --------     --------
    Total interest income                                 14,583         11,553          26.23        3,030

Interest expense
  Deposits                                                 6,488          5,519          17.56          969
  Securities sold under agreements to repurchase             549            261         110.34          288
  Federal funds purchased and FHLB advances                  195            197          (1.02)          (2)
  Other borrowed money                                        26              0         100.00           26
                                                       ---------       ---------       --------     --------
    Total interest expense                                 7,258          5,977          21.43         1,281

Net interest income                                        7,325          5,576          31.37         1,749
Provision for loan losses                                    275            526         (47.72)         (251)
                                                       ---------       ---------       --------      --------
Net interest income after loan loss                        7,050          5,050          39.60         2,000

Noninterest income
  Service charges & fees                                     875            738          18.56           137
  Gain on sale of loans                                      106             30         253.33            76
  Gain on sale of securities                                 128              4       3,100.00           124
  Gain on sale of servicing                                   72            271         (73.43)         (199)
  Broker loan fees                                            88            134         (34.33)          (46)
  Originated mortgage servicing rights                       300             37         710.81           263
  Merchant fees                                              392            257          52.53           135
  Other income                                               315            268          17.54            47
                                                       ---------        --------      ---------       -------
    Total noninterest income                               2,276          1,739          30.88           537

Noninterest expense
  Salaries & employee benefits                             3,268          2,454          33.17           814
  Net occupancy expense                                      418            308          35.71           110
  Furniture and equipment expenses                           451            445           1.35             6
  Data processing fees                                       487            280          73.93           207
  Legal fees                                                 875            236         270.76           639
  Litigation settlement                                      525              0         100.00           525 
  Other expense                                            2,383          1,667          42.95           716
                                                       ---------       ---------      ---------       -------
    Total noninterest expense                              8,407          5,390          55.97         3,017

Income before income taxes                                   919          1,399         (34.31)         (480)
Provision for income taxes                                   322            501         (35.73)         (179)
                                                       ---------       ---------      ---------       -------
Net income                                                   597            898         (33.52)         (301)
                                                      ==========       =========      =========       =======
Earnings per share (actual $'s)
Basic                                                       0.12           0.18
Diluted                                                     0.12           0.18

Average Number of shares outstanding
Basic                                                  4,994,542      4,982,325
Diluted                                                5,023,755      4,999,032

</TABLE>

The accompanying notes are an integral part of these financial statements.

                                     Page 3
<PAGE>
American Bancshares, Inc. and Subsidiaries
Consolidated Condensed Statement of Cashflows
(unaudited, $ in thousands)
<TABLE>
<CAPTION>
                                                       Six Months ended June 30,
                                                         1998           1997    
                                                      -----------    -----------
<S>                                                   <C>            <C>        
Cash flows from operating activities:
 Net income                                                  597            898
                                                        ---------      ---------
 Adjustments  to reconcile  net income to net cash  
 provided by operating activities:
  Provision for loan losses                                  275            526
  Net gain on sale of investment securities                 (126)            (1)
  Net gain on sale of loans                                 (106)           (30)
  Net gain on sale of mortgage servicing rights              (72)          (271)
  Net gain on originated mortgage servicing rights          (300)           (37)
  Net gain on sale of assets                                   0             (1)
  Deferred income taxes                                        0            (65)
  Depreciation                                               415            331
  Proceeds from sales of loans held for sale              23,850         10,693
  Net amortization of premiums and accretion of
   discounts on investment securities                        (12)             6
  Increase in other liabilities                            1,533            213
  Increase in other assets                                (2,220)          (866)
                                                        ---------      ---------
 Total adjustments                                        23,237         10,498
                                                        ---------      ---------
Net cash provided by operating activities                 23,834         11,396
                                                        ---------      ---------
Cash flows from investing activities:
  Loan originations, net of repayments                   (72,273)       (46,919)
  Purchases of bank premises and equipment                (2,824)        (1,382)
  Proceeds on sales of assets                                  0             40
  Proceeds from sales and maturities of available 
   for sale investment securities                         34,561          3,854
  Purchases of available for sale investment
   securities, net of repayments                         (21,932)       (17,709)
                                                        ---------      ---------
Net cash used in investing activities                    (62,468)       (40,730)
                                                        ---------      ---------
Cash flows from financing activities:
  Net increase in demand deposits, 
   NOW and savings accounts                               19,262         27,370
  Net increase (decrease) in time deposits                (4,989)        11,150
  Net increase in securities sold under
   agreements to repurchase                               11,539          6,169
  Net proceeds from advances (repayments) from
   the FHLB and Federal Funds purchased                    8,501           (800)
  Proceeds from sale of stock                                  0            425
                                                        ---------      ---------
Net cash provided by financing activities                 34,313         44,314
                                                        ---------      ---------
Net increase (decrease) in cash and cash equivalents      (4,321)        (6,406)
Cash and cash equivalents at beginning of period          18,396         23,570

Cash and cash equivalents at end of period                14,075         17,164
                                                       ==========     ==========
Supplemental disclosures:
 Interest paid                                             7,103          5,927
                                                       ==========     ==========
 Income taxes paid                                           665            170
                                                       ==========     ==========
</TABLE>

The accompanying notes are an integral part of these financial statements.

                                     Page 4
<PAGE>
                       AMERICAN BANCSHARES, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS




Note 1.    Holding Company and Subsidiaries Background Information

American  Bancshares,  Inc. (Company),  is a one bank holding company,  operated
under the laws of the state of Florida.  Its wholly owned banking  subsidiary is
American Bank (Bank),  a state  chartered bank. The Holding  Company,  a Florida
corporation  organized June 30, 1995, is a registered  holding company under the
Bank Holding Company Act of 1956, as amended, and on December 1, 1995 became the
bank holding company for the Bank. The Bank was incorporated on December 6, 1988
and opened for business on May 8, 1989.  The Bank is a general  commercial  bank
with all the rights,  powers,  privileges  granted and  conferred by the Florida
Banking Code. Although the Holding Company was not formed until June 30,1995 and
did not acquire the Bank until December 1, 1995, the financial  statements  have
been presented as if the Company had been in existence since the Bank was formed
in 1988 and as if the Bank was its wholly owned subsidiary since that time.

The Company has organized a wholly-owned Florida subsidiary corporation, Freedom
Finance Corporation,  ("Finance Company"),  pursuant to which it engages in full
service consumer financing.  The Finance Company offers consumer-driven products
and services ranging from mortgages to automobile  loans,  home equity loans and
education financing.  The Finance Company has the ability to extend financing to
individuals   and  entities  which  may  not  be  able  to  satisfy  the  Bank's
underwriting requirements or loan standards. During April 1998 the Bank extended
a $2.4 million line of credit to the Finance Company to support operations.  The
Finance Company commenced preliminary operations in late March 1998.

ABI Capital Trust  ("ABICT"),  a Delaware  statutory  trust,  was created on May
21,1998. The ABICT exists for the  exclusive  purpose of (i) issuing and selling
Common  Securities  and  Preferred  Securities  of ABICT  (together  the  "Trust
Securities"), (ii) using the proceeds of the sale of Trust Securities to acquire
Deferrable Interest Debentures ("Junior Subordinated  Debentures") issued by the
Company,   and  (iii)  engaging  only  in  those  other  activities   necessary,
convenient,  or incidental  thereto (such as  registering  the transfer of Trust
Securities).  Accordingly  the Junior  Subordinated  Debentures will be the sole
assets of the ABICT.  On July 7,1998 the ABICT  issued $15 million of 8.5% Trust
Securities,  the  Company  invested  $463,920,  in the  form of a  common  stock
purchase,  and the  ABICT  purchased  $15,463,920  of 8.5%  Junior  Subordinated
Debentures  from the  Company.  In  connection  with the  over-allotment  option
granted to the underwriter on August 6,1998 the ABICT issued  $1,249,420 of 8.5%
Trust  Securities,  the Company invested an additional  $38,650 in the form of a
common  stock  purchase,  and the  ABICT  purchased  $1,288,070  of 8.5%  Junior
Subordinated  Debentures  from the  Company.  The Company owns all of the Common
Securities  of  ABICT,  the  only  voting  security,  and  as a  result  it is a
subsidiary of the Company.

Note 2.           Basis of Presentation

The accompanying unaudited condensed  consolidated financial statements,  in the
opinion  of  management,  include  all  adjustments,  consisting  only of normal
recurring  adjustments  necessary for a fair presentation of the results for the
interim periods.  Certain information and footnote disclosures normally included
in  financial   statements   prepared  in  accordance  with  generally  accepted
accounting  principles have been condensed or omitted  pursuant to SEC rules and
regulations,  although the Company believes that the disclosures included herein
are adequate to make the information  presented not  misleading.  The results of
operations  for the three  and six month  periods  ended  June 30,  1998 are not
necessarily indicative of the results expected for the full year.

The organization and business of the Company,  accounting  policies  followed by
the Company and other  information  are contained in the Company's  December 31,
1997 Form 10-KSB.  This quarterly report should be read in conjunction with such
annual report.

Merger - On March 23,1998, the Company completed its merger with Murdock Florida
Bank (Murdock).  In connection with the merger the Company issued 924,026 shares
of it's common stock in exchange for all of the outstanding  Murdock shares. The
transaction  was  accounted  for as a  pooling  of  interests.  Accordingly  the
Consolidated Balance Sheet,  Income Statement and Statement of Cash Flow include
the results of Murdock on a historical basis

                                     Page 5
<PAGE>
                       AMERICAN BANCSHARES, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS


Note 3.           Investments

The  Company's  investments and  mortgage-backed  securities  are  classified as
available  for sale and recorded at fair value as required by the  provisions of
Statement of Financial Accounting Standards No. 115. Unrealized gains and losses
are  reflected  as  a  separate   component  of  shareholders'   equity  on  the
consolidated  statement of condition.  At June 30, 1998, an unrealized gain, net
of tax, of $68,000 was reflected as an increase of shareholders' equity.

Note 4.           Earnings Per Share

  Basic  earnings per common share is  calculated  by dividing net income by the
sum of the weighted average number of shares of common stock outstanding.

  Diluted  earnings per common share is calculated by dividing net income by the
weighted  average  number of shares of common  stock  outstanding,  assuming the
exercise of stock options and warrants  using the treasury  stock  method.  Such
adjustments to the weighted average number of shares of common stock outstanding
are made only when such  adjustments  dilute  earnings  per  common  share.  The
diluted earnings per share is summarized as follows:
<TABLE>
<CAPTION>
                                                             Six Months              Three Months   
                                                            ended June 30,          ended June 30,
                                                           1998        1997        1998        1997
                                                        ---------   ---------   ---------   ---------
<S>                                                     <C>         <C>         <C>         <C>
Weighted average common shares outstanding............  4,994,542   4,982,325   4,994,599   4,994,484
Weighted average common shares equivalents............     29,213      16,707      29,455      10,846
                                                        ---------   ---------   ---------   ---------
Shares used in diluted earnings per share
  calculation.........................................  5,023,755   4,999,032   5,024,054   5,005,330
                                                        =========   =========   =========   =========
</TABLE>

Note 5.           Capital

In December 1995,  the Company filed a registration  statement on Form SB-2 with
the Securities and Exchange  Commission to register for sale 1,250,000 shares of
the Company's  common stock (with an additional  187,500  shares  subject to the
underwriters'  over  allotment  option)  at $6.00 per share  pursuant  to a firm
commitment  underwritten public offering.  The SB-2 became effective February 6,
1996, with the sale of 1,250,000 shares of common stock  consummated on February
13,  1996.  On March 6,  1996,  the  underwriter  elected to  exercise  the over
allotment,  consummating  the transaction on March 13, 1996. Of the net proceeds
of approximately  $7.5 million,  $7.3 million has been contributed as capital to
the Bank.  The  balance  was used for  general  corporate  purposes  and working
capital.

In July 1998 and August 1998, the Company issued Junior Subordinated  Debentures
totaling approximately $16.8 million. Of the net proceeds of approximately $15.8
million the Company has  invested  $8.0  million in the Bank,  as an  additional
capital  contribution,   and  repaid  other  outstanding  indebtedness  totaling
approximately  $3.0  million.  The balance of the funds will be used for general
corporate  purposes,  including but not limited to (i) making additional capital
contributions to the Bank, (ii) making additional  capital  contributions to the
Finance Company,  (iii) investing in other business opportunities as may present
themselves from time to time, and (iv) working capital.



                                     Page 6
<PAGE>
                       AMERICAN BANCSHARES, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS


Note 6.           Comprehensive Income

Effective January 1, 1998 the Company has adopted Financial Accounting Standards
("FAS") No. 130 "Reporting  Comprehensive Income," which requires that all items
that are required to be recognized under  accounting  standards as components of
comprehensive income be reported in the financial statements. Prior periods will
be reclassified as required.  The Company's total comprehensive  earnings are as
follows:
<TABLE>
<CAPTION>
Comprehensive Earnings (unaudited, actual $)

                                                Six months ended
                                         June 30, 1998       June 30, 1997
<S>                                     <C>                 <C>
Net income (loss)                              596,781             897,915   
Other comprehensive earnings (losses):               0                   0
Unrealized gains (losses) on
      securities                               (72,433)           (367,223)
                                              ---------           ---------
Comprehensive income                           524,348             530,692
</TABLE>

Note 7.           Impact of Recently Issued Accounting Standards

FAS  No.  131,   Disclosures   about  Segments  of  an  Enterprise  and  Related
information,  is effective for fiscal years  beginning  after December 15, 1997.
This statement  establishes  standards for reporting information about operating
segments in annual financial  statements and interim  information is required to
be reported on the basis that it is used  internally for evaluating  performance
of and  allocation of resources to operating  segments.  The Company has not yet
determined  to what  extent the  standard  will  impact the  disclosures  in the
financial statements.

FAS No. 132,  "Employers'  Disclosures  about Pensions and Other  Postretirement
Benefits" which is effective for periods beginning after December 15, 1997. This
statement revises employers'  disclosures about pension and other postretirement
benefit plans.  Because this statement addresses  disclosures only, the adoption
will have no material impact on the financial statements.

On June  15,  1998  the  Financial  Accounting  Standards  Board  (FASB)  issued
Statement of Financial  Accounting  Standards No. 133, Accounting for Derivative
Instruments  and Hedging  Activities  (FAS 133).  FAS 133 is  effective  for all
fiscal  quarters of all fiscal years  beginning  after June 15, 1999 (January 1,
2000 for the  Company).  FAS 133 requires  that all  derivative  instruments  be
recorded on the balance sheet at their fair value.  Changes in the fair value of
derivatives are recorded each period in current earnings or other  comprehensive
income,  depending  on whether a  derivative  is  designated  as part of a hedge
transaction, if it is, the type of hedge transaction.  Management of the Company
anticipates that, due to its limited use of derivative instruments, the adoption
of FAS 133  will not have a  significant  effect  on the  Company's  results  of
operations or its financial position.

Note 8.           Litigation

 On March 27,1997, James J. Bazata, a former employee of the Bank, filed a claim
in the United States District Court, Tampa Division, alleging that such employee
was discriminated  against.  It is alleged that this conduct violated his rights
under the Americans with Disabilities Act of 1990. The company believes that the
Bank acted  appropriately  and that this action was without  merit.  Pursuant to
negotiations with Mr. Bazata,  the Company agreed to settle this lawsuit on July
1,1998,  exhibit 10.3 of this form 10-Q is incorporated herein by reference,  by
entering  into a  consulting  agreement,  exhibit  10.2  of  this  form  10-Q is
incorporated  herein by reference,  with Mr.  Bazata's  corporation for services
through December 31, 2000, and has further agreed to pay Mr. Bazata's legal fees
and costs  incurred in  connection  with the  lawsuit.  The total  payments  due
through the end of 2000 under the consulting  agreement,  and Mr. Bazata's legal
fees and costs,  aggregate $525,000.  The Company expensed the entire settlement
in the period  ending June  30,1998,  accruing  all amounts due  pursuant to the
consulting agreement, legal fees and costs.



                                     Page 7
<PAGE>

PART 1

ITEM 2.

Management's Discussion and Analysis of Financial Condition and Results of
Operations

American Bancshares, Inc. and Subsidiaries

General

 This  discussion  contains  certain  "forward-looking  statements"  within  the
meaning  of the  Private  Securities  Litigation  Reform  Act of  1995,  such as
statements  relating  to the  financial  condition  and  prospects,  results  of
operations,  plans for future business development activities,  capital spending
and  financing  sources,  capital  structure,  the  effects  of  regulation  and
competition,  and the  business of the Company.  Where used in this filing,  the
words "anticipate", "believe", "estimate", "expect", "intend", and similar words
and  expressions,  as they  relate  to the  Company,  or the  management  of the
Company, identify forward-looking  statements.  Such forward-looking  statements
reflect the current views of the Company and are based on information  currently
available  to the  management  of the  Company  and upon  current  expectations,
estimates,  and  projections  about the Company and its  industry,  management's
beliefs with respect thereto, and certain assumptions made by management.  These
forward-looking  statements  are not  guarantees of future  performance  and are
subject to risks,  uncertainties,  and other  factors  which could cause  actual
results  to  differ   materially   from  those  expressed  or  implied  by  such
forward-looking  statements as a result of various factors.  Potential risks and
uncertainties  include,  but are not limited to: (i) competitive pressure in the
banking and financial services industries increasing significantly; (ii) changes
in the  interest  rate  environment  which  reduce  margins;  (iii)  changes  in
political  conditions  or changes  occurring in the  legislative  or  regulatory
environment;  (iv) general economic conditions, either nationally or regionally,
becoming  less  favorable  than expected  resulting  in, among other  things,  a
deterioration in credit quality;  (v) changes  occurring in business  conditions
and inflation;  (vi)  acquisitions  and  integration  of acquired  businesses or
assets;  (vii)  changes  in  technology;  (viii)  changes  in  monetary  and tax
policies,  (ix) changes occurring in the securities markets; and (x) other risks
and uncertainties  detailed from time to time in the filings of the Company with
the Commission.

Liquidity and Capital Resources

Total assets of the Company  increased by 10.28% to  $390,276,000 as of June 30,
1998, from  $353,901,000 as of December 31, 1997 and 22.6% from  $319,222,000 as
of June 30, 1997.  The increase in assets from December 31, 1997,  was primarily
the result of increases in Cash and Due From Banks of $3,935,000 to $13,484,000,
increases in Net Loans of $48,258,000 to $301,250,000 and premises and equipment
of  $2,409,000  to  $11,570,000.  The  increases  in assets were funded  through
increases in deposits of  $14,273,000 to  $317,019,000,  increases in Securities
Sold Under  Agreements to Repurchase of $11,539,000 to $29,067,000 and increases
in borrowings of $8,501,000 to $14,001,000.

As of June 30, 1998, the Bank's Tier 1 leverage ratio was 7.36%,  Tier 1 to risk
weighted assets was 10.18% and total risk based capital was 11.01%, resulting in
a classification of "Well Capitalized" under FDIC guidelines.  The Bank, through
its Asset/Liability Committee,  monitors, among other things, the Bank's capital
and liquidity  position,  making  adjustments  to deposit,  loan, and investment
strategies  as  necessary.  The Bank  continues to maintain  adequate  liquidity
levels with a liquidity  ratio at June 30, 1998 of 40.71%.  The Bank is a member
of the  Federal  Home Loan Bank of Atlanta  (FHLB).  FHLB has approved a line of
credit totaling  $50,000,000  collateralized by qualifying  mortgages and all of
the  Bank's FHLB  stock. As of June 30, 1998, advances totaling $11,000,000 were
outstanding.  The Bank also maintains  Federal Funds  Purchased  agreements with
several  correspondent  banks to provide sources of overnight  funds. As of June
30, 1998, the Bank had no federal funds purchased.  In addition, the Company has
obtained a $5 million  Commercial  Revolving  Line of Credit from Barnett Banks,
N.A., South Florida (now Nationsbank,  N.A.).  Although this credit facility has
been used in part to fund the  construction of the Company's new  administrative
offices,  the Company also has utilized  the credit  facility for other  general
corporate purposes.  At June 30, 1998, $3.00 million was outstanding on the line
of credit.  During  April  1998,  the new  administrative  office  building  was
completed and is now occupied.  The cost of construction was approximately  $2.5
million.  In June,  1998 the  administrative  offices were sold to the Bank,  at
cost, to allow the Company to better leverage its capital position.

In July 1998 and August 1998, the Company issued Junior Subordinated  Debentures
("Debenture") totaling approximately $16.8 million, at an interest rate of 8.5%.
Of the net proceeds of approximately $15.8 million the Company has invested $8.0
million  in the Bank,  as an  additional  capital  contribution,  and repaid and
cancelled the  Commercial  Revolving  Line of Credit from Barnett  Banks,  N.A.,
South Florida (now Nationsbank, N.A.). totaling approximately $3.0 million.



                                     Page 8
<PAGE>

Management's Discussion and Analysis of Financial Condition and Results of
Operations

Liquidity and Capital Resources (continued)

In July and August,  1998 the Bank also drew down $26 million of it FHLB line of
credit at an interest rate ranging from 5.04% - 5.09%. The average interest rate
on the  subordinate  debentures  and the FHLB  advances was 6.57%.  The Bank has
invested  these funds  primarily in FNMA and FHLMC  securities,  with an average
yield of 6.57

Additionally,  on July 15,1998 the Bank acquired a former  SouthTrust Bank, N.A.
branch located at 1201 Beneva Rd. South,  Sarasota,  Florida 34236. The purchase
price was  $725,000.  No  deposits or loans were  acquired  in the  transaction.
Application has been made to various regulatory  agencies to request approval to
operate this location as a branch of the Bank. The Bank is currently negotiating
a lease for another  branch  location in a  developing  area of Manatee  County.
Finally the bank has bid on eight former NationsBank,  N.A.  locations;  four in
Charlotte County,  three in Manatee County and one in Sarasota County. There can
be no assurance that the Bank will be able to acquire any or all of these sites.
Various regulatory approvals are needed in order for the Bank to open additional
branch  locations.  Regulatory  approval  to operate  any of the  aforementioned
locations can not be assumed.

Management  believes that there are adequate  funding sources to meet its future
liquidity needs for the foreseeable  future. Primary among these funding sources
are the  repayment  of  principal  and  interest  on loans,  the renewal of time
deposits,  and the growth in the deposit base.  Management does not believe that
the terms and  conditions  that will be present at the renewal of these  funding
sources  will  significantly  impact  the  Company's  operations,   due  to  its
management of the maturities of its assets and liabilities.

Results of Operations

The  Company's  net income for the quarter  ended June 30, 1998 was  $193,000 or
$.04 per share,  compared  to net income of  $565,000  or $.11 per share for the
same period for 1997.  Earnings  per share were  affected by  settlement  of the
Bazata  litigation  of  $525,000  and  associated  legal fees of  $135,000.  Net
interest income increased  $905,000 to $3,807,000 for the quarter ended June 30,
1998,  over the same  quarter in 1997,  as a result of the  increase in interest
earning assets.  Non-interest  income  increased from $1,068,000 for the quarter
ended June 30, 1997 to $1,172,000 for the same period in 1998. The increase in
non-interest  income  is  primarily  attributable  to  increases  in  originated
mortgage servicing rights ("OMSR's") of $172,000, in service charges on deposits
and fees of $38,000,  an increase of $18,000 on the sale of mortgage  loans,  an
increase  of $4,000 in gain on sale of  securities,  an  increase in credit card
merchant  services  fee income of $71,000  and an  increase  of $22,000 in other
income  partially  offset by  decreases in gain on sale of servicing of $169,000
and broker loan fees of $52,000.

Total  general and  administrative  expense for the quarter ended June 30, 1998,
increased  $1,770,000  over the same  period  of 1997.  This  increase  resulted
primarily from increases in other  operating  expenses  related to the growth in
the Company's  assets,  the number of Bank branches,  the acquisition of Murdock
Florida  Bank,  and the  start  up of the  Finance  Company  and  settlement  of
outstanding litigation. Specifically, salary expense increased by $514,000, data
processing  increased by $13,000.  A settlement of outstanding  litigation  cost
$525,000,  associated legal fees accounted for $135,000 of the $204,000 increase
in legal fees. Other expenses increased by $465,000 due to increased advertising
of $93,000;  increased check printing charges of $48,000, partially attributable
to the complimentary  supply,  for Murdock  customers,  of American Bank checks;
continued asset growth; and the start up costs of the Finance Company.

For the three months ended June 30,1998,  net interest income increased $905,000
to  $3,807,000,  compared to $2,902,000 for the same period in 1997, as a result
of the 23% asset growth. Loan loss expense decreased from $355,000 for the three
month  period  ended  June 30,  1997 to  $151,000  for the same  period in 1998.
Management  uses a procedure on a monthly basis for  evaluating  the adequacy of
the  allowance  for loan loss.  Based on that review  management  considers  the
allowance sufficient to cover expected loan losses.

PART 1.

ITEM 3.  Quantitative and Qualitative Disclosure About Market Risk

         Not applicable.



                                     Page 9
<PAGE>


PART II - OTHER INFORMATION


Item 1.   Legal Proceedings

 On March 27,1997, James J. Bazata, a former employee of the Bank, filed a claim
in the United States District Court, Tampa Division, alleging that such employee
was discriminated  against.  It is alleged that this conduct violated his rights
under the Americans with Disabilities Act of 1990. The company believes that the
Bank acted  appropriately  and that this action was without  merit.  Pursuant to
negotiations with Mr. Bazata,  the Company agreed to settle this lawsuit on July
1,1998,  exhibit 10.3 of this form 10-Q is incorporated herein by reference,  by
entering  into a  consulting  agreement,  exhibit  10.2  of  this  form  10-Q is
incorporated  herein by reference,  with Mr.  Bazata's  corporation for services
through December 31, 2000, and has further agreed to pay Mr. Bazata's legal fees
and costs  incurred in  connection  with the  lawsuit.  The total  payments  due
through the end of 2000 under the consulting  agreement,  and Mr. Bazata's legal
fees and costs,  aggregate $525,000.  The Company expensed the entire settlement
in the period  ending June  30,1998,  accruing  all amounts due  pursuant to the
consulting agreement, legal fees and costs.

Item 2.   Changes in Securities

ABI Capital Trust  ("ABICT"),  a Delaware  statutory  trust,  was created on May
21,1998.  On June 4,1998 the Company filed a registration  statement on Form S-1
to register Preferred Securities to be offered  and sold by ABICT as well as the
Junior  Subordinated  Debenture  and  guarantee of the  Company underlying  such
Preferred Securities.  The registration statement was amended on June 19,1998 by
filing  Amendment  No.  1 to the  Form  S-1.  The S-1 and  Amendment  No.  1 are
incorporated  herein by  reference.  As of the filing  date the ABICT has issued
approximately $16.25 million of 8.5% Trust Securities.  The Company has incurred
approximately  $971,000 in costs  associated with the formation of the ABICT and
issue of the securities.  These costs are being  amortized over  the contractual
life of the securities.

On July  21,1998 the Board of  Directors  of the Company  voted to issue  47,400
stock options  pursuant to the "American  Bancshares,  Inc. and American Bank of
Bradenton  Incentive  Stock  Option Plan of 1996." Of these 5,000 stock  options
were issued to Gerald L. Anthony, President  and CEO,  20,000 stock options were
issued to senior  officers.  The  remaining  22,400 stock options were issued to
other Bank staff members.

On July 21,1998 the Board of Directors of the Company voted to issue 74,998
stock options pursuant to the "American Bancshares, Inc. Directors'
Non-qualified Stock Option Plan of 1997."

Item 3.   Defaults Upon Senior Securities

          Not applicable this filing.

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

The  following  matters  were  submitted  to a vote of  security  holders at the
Company's annual meeting on May 22, 1998.

1.      To elect twelve persons as Directors.

The following directors,  which consisted of all of the existing directors, were
nominated for re-election:

                                        Percentage
                                   For          Against      Abstain
        Gerald L. Anthony          99.62           0.38         0.00
        Samuel S. Aidlin           99.04           0.96         0.00
        Ronald L. Larson           98.97           1.03         0.00
        Timothy I. Miller          99.62           0.38         0.00
        Dan E. Molter              99.51           0.49         0.00
        Kirk D. Moudy              98.98           1.02         0.00
        Lindell Orr                99.60           0.40         0.00
        Lynn B. Powell             99.51           0.49         0.00
        Walter L. Presha           99.50           0.50         0.00
        J. Gary Russ               99.61           0.39         0.00
        R. Jay Taylor              99.60           0.40         0.00
        Edward D. Wyke             99.51           0.49         0.00

Of the total  of 4,994,484 shares of  common stock eligible  to vote, there were
3,453,604 shares  present in  person or by proxy and  the above  named directors
were re-elected with the results for each  noted above.



                                     Page 10
<PAGE>

PART II - OTHER INFORMATION

Item 4.   Submission of Matters to a Vote of Security Holders (continued)

      2. To ratify the  selection  of Coopers & Lybrand  L.L.P.  as  independent
accountants for the Corporation for the year ending December 31, 1998.

Of the total of 4,994,484  shares of common stock  eligible to vote,  there were
3,453,604  shares present in person or by proxy with 3,418,322 votes for, 19,663
votes  against,  and 16,619  abstaining.  Coopers and Lybrand  were  retained as
independent accountants for the Company.

Item 5.           Other Information

1. In February,  1998,  the Company  entered into an employment  agreement  with
Brian M.  Watterson,  Senior Vice President,  Chief Financial  Officer and Chief
Operations Officer.  The employment agreement is  filed as  exhibit 10.1 of this
Form 10-Q is incorporated herein by reference.

2.  The  Company  recently  has  organized  a  wholly-owned  Florida  subsidiary
corporation,  Freedom  Finance  Corporation,  (referred to herein as the Finance
Company),  pursuant  to which it has begun to engage  in full  service  consumer
financing.  The Finance Company commenced  preliminary  operations at the end of
March 1998.In order to provide the Finance  Company with the funds  necessary to
commence operations,  the Company made a small capital contribution and the Bank
extended a $2.4 million loan to the Finance Company in April 1998. This loan was
made on substantially  the same terms and conditions,  including  interest rates
and collateral on loans, as those  prevailing for comparable  transactions  with
unrelated third parties.  It is anticipated  that the Finance Company will offer
consumer-driven  products and  services  ranging  from  mortgages to  automobile
loans, home equity loans and education financing.  The Finance Company will have
the ability to extend  financing to  individuals  and entities  which may not be
able to satisfy the Bank's underwriting requirements or loan standards. However,
the Finance  Company is expected to provide  such loans on a selective  basis to
customers that the Finance Company believes are quality credits.  Such customers
will likely consist of  individuals  or entities  which have another  banking or
credit relationship with the Company or the Bank.

3. On May 21,1998 ABI Capital Trust, a Delaware Statutory Trust was created. The
Company owns all of the Common  Securities of ABICT,  it's only voting security.
Accordingly  ABICT  is a  subsidiary  of the  Company  for  financial  reporting
purposes only. A balance sheet enumerating the financial position of ABI Capital
Trust is presented below.

ABI Capital Trust Balance Sheet 
As of August 10,1998 
(Unaudited, actual $)

Assets
Cash and due from banks                     $          0
Junior Subordinated Debentures                16,751,990
Accrued interest receivable                       88,336
                                            -------------
Total assets                                $ 16,840,326
                                            =============

Liabilities
Trust Preferred Securities                  $ 16,249,420
Accrued dividends payable                         85,686
Other accrued expenses payable                     2,650
                                            -------------
Total liabilities                             16,337,756

Shareholders' equity
Common stock                                     502,570
                                            -------------
Total shareholders' equity                       502,570

Total liabilities and shareholders' equity  $ 16,840,326
                                            =============



                                     Page 11
<PAGE>

PART II - OTHER INFORMATION


Item 6.        Exhibits and Report on Form 8-K

(a)   Exhibits:

    4.1--  Form  of  indenture   with  respect  to  the  Company's  8.5%  Junior
           Subordinated  Debentures  incorporated herein by reference to exhibit
           4.1 of the Company's Registration Statement on Form S-1 (Registration
           Nos. 333-56095 and 333-56095-01)filing dated June 4,1998  previously
           filed with the Commission.

    4.2--  Form  of  Junior  Subordinated   Debentures  incorporated  herein  by
           reference  to exhibit  4.1 of the  Company's  Registration Statement
           on Form S-1 (Registration Nos. 333-56095 and 333-56095-01)filing 
           dated June 4,1998  previously filed with the Commission.

    4.3--  Form of Trust Agreement of ABI Capital Trust  (including  Certificate
           of Trust of ABI Capital  Trust)  incorporated  herein by reference to
           exhibit  4.3  of  the Company's  Registration  Statement on  Form S-1
           (Registration  Nos. 333-56095  and 333-56095-01) filing dated June 4,
           1998 previously filed with the Commission.

    4.4--  Form of Amended and Restated  Trust  Agreement  of ABI Capital  Trust
           incorporated  herein  by  reference  to  exhibit 4.4 of the Company's
           Registration  Statement on  Form S-1 (Registration  Nos. 333-56095
           and 333-56095-01) filing dated June 4, 1998 previously filed with the
           Commission.

    4.5--  Form of 8.5% Preferred  Securities of ABI Capital Trust  incorporated
           herein by reference to exhibit 4.4 of the  Company's Registration  
           Statement on Form S-1 (Registration  Nos. 333-56095 and 333-56095-01)
           filing dated June 4, 1998 previously filed with the Commission.

    4.6--  Form of  Guarantee  Agreement  incorporated  herein by  reference  to
           exhibit 4.6 of  the  Company's  Registration  Statement  on Form  S-1
           (Registration  Nos. 333-56095 and  333-56095-01) filing dated June 4,
           1998 previously filed with the Commission.

   10.1--  Employment  Agreement  dated February 1, 1998 by and between Brian M.
           Watterson  and American Bank is  incorporated  herein by reference to
           exhibit 10.1 of the Company's 10-Q filing dated May 15,1998 
           previously filed with the Commission.

   10.2--  Consulting Agreement dated July 1,1998 by and between James J. Bazata
           Consulting, Inc. and American Bank.

   10.3--  Bazata V. American Bank Confidential Settlement Agreement dated July
           1,1998 by and between James J. Bazata, his heirs, executors,
           administrators and assigns and American Bank and the Bank releasees.

(b)   Reports on Form 8-K

On April 6, 1998, the  Company  filed a report on Form 8-K announcing the
consummation of the merger by and  between American Bank and Murdock Florida 
Bank, which Form 8-K provided for the extension under Item 7(a)(4) thereof for 
furnishing certain financial statements.

On May 21,  1998,  the Company  filed a report on Form 8-K/A  providing  certain
financial  statements  relating to the consummation of the merger by and between
American Bank and Murdock Florida Bank.



                                     Page 12
<PAGE>


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.




                                            /s/      Gerald L. Anthony
                                            -----------------------------------
                                            Gerald L. Anthony, President and
                                            Chief Executive Officer


                                            Date:    August 14, 1998
                                                 -------------------


                                            /s/      Brian M. Watterson
                                            -----------------------------------
                                            Brian M. Watterson
                                            Senior Vice President and
                                            Chief Financial Officer


                                            Date:    August 14, 1998
                                                   -------------------