FORM 10-Q

                         SECURITIES AND EXCHANGE COMMISSION
                              Washington, D.C.  20549


             [?]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                          SECURITIES EXCHANGE ACT OF 1934
                     For the quarterly period ended September 30, 1998

                                      OR

             [  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                       SECURITIES EXCHANGE ACT OF 1934
                  For the transition period from _______ to _______.

                          Commission file number 010042


                            One Valley Bancorp, Inc.
              (Exact name of registrant as specified in its charter)


   West Virginia                                           55-0609408 
State or other jurisdiction                              (I.R.S Employer
Of incorporation or organization                        Identification No.)

               One Valley Square, Charleston, West Virginia  25326
                    (Address of principal executive offices)
                                 (Zip Code)


                               (304) 348-7000
               (Registrant's telephone number, including area code)


                                Not applicable                 _
      (Former name, address, and fiscal year, if changed since last report)

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

The number of shares outstanding of each of the issuer's classes of common 
stock as of September 30, 1998 was:


           Common Stock, $10.00 par value -34,715,450 shares 


<PAGE>
One Valley Bancorp, Inc.

Part I.                  Financial Information

Item 1.    Financial Statements.

The unaudited interim consolidated financial statements of One Valley Bancorp, 
Inc. (One Valley) or (Registrant) are included on pages 3 - 8 of this report.

These consolidated financial statements have been prepared in accordance with 
generally accepted accounting principles for interim financial information and 
with instructions to Form 10-Q and Rule 10-01 of Regulation S-X.  Accordingly, 
they do not include all the information and footnotes required by generally 
accepted accounting principles for annual year-end financial statements.  In 
the opinion of management, all adjustments considered necessary for a fair 
presentation have been included and are of a normal recurring nature.  
Operating results for the nine-month period ended September 30, 1998 are not 
necessarily indicative of the results that may be expected for the year ending 
December 31, 1998.  For further information, refer to the consolidated 
financial statements and footnotes thereto included in the Registrant's Annual 
Report on Form 10-K for the year ended December 31, 1997.

The Private Securities Litigation Act of 1995 indicates that the disclosure of 
forward-looking information is desirable for investors and encourages such 
disclosure by providing a safe harbor for forward-looking statements by 
corporate management.  This Quarterly Report on Form 10-Q contains forward-
looking statements that involve risk and uncertainty.  In order to comply with 
the terms of the safe harbor, the corporation notes that a variety of factors 
could cause One Valley's actual results and experience to differ materially 
from the anticipated results or other expectations expressed in those forward-
looking statements.

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

Management's discussion and analysis of financial condition and results of 
operations is included on pages 9 - 22 of this report.

<PAGE>
<TABLE>
ONE VALLEY BANCORP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(unaudited in thousands)
<CAPTION>
                                                               September 30    December 31   September 30
                                                                    1998           1997          1997
<S>                                                             <C>            <C>           <C>
ASSETS
Cash and Due From Banks                                           $144,495       $127,012      $145,140
Interest Bearing Deposits With Other Banks                           4,843          2,162         5,783
Federal Funds Sold                                                  47,951         20,310        49,475
                                                                ----------     ----------    ----------
   Cash and Cash Equivalents                                       197,289        149,484       200,398
Securities
   Available-for-Sale, at fair value                             1,320,845      1,216,749     1,177,818
   Held-to-Maturity (Estimated Fair Value,
   September 30, 1998 - $264,816; December 31, 1997 -
   $355,820; September 30, 1997 -  $341,337)                       255,264        352,272       334,558
Loans
   Total Loans                                                   3,902,448      3,302,536     3,227,413
   Less: Allowance For Loan Losses                                  51,826         45,048        45,040
                                                                ----------     ----------    ----------
   Net Loans                                                     3,850,622      3,257,488     3,182,373
Premises & Equipment - Net                                         101,781         90,397        90,376
Other Assets                                                       130,621         95,096        88,312
                                                                ----------     ----------    ----------
   Total Assets                                                 $5,856,422     $5,161,486    $5,073,835
                                                                ==========     ==========    ==========

LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
   Non-interest Bearing                                           $538,451       $465,227      $422,162
   Interest Bearing                                              3,895,150      3,468,947     3,458,192
                                                                ----------     ----------    ----------
   Total Deposits                                                4,433,601      3,934,174     3,880,354
Short-term Borrowings
   Federal Funds Purchased                                          42,925         22,581        54,750
   Repurchase Agreements and Other Borrowings                      697,391        600,899       540,191
                                                                ----------     ----------    ----------
   Total Short-term Borrowings                                     740,316        623,480       594,941
Long-term Borrowings                                                37,084         48,875        53,877
Other Liabilities                                                   56,897         51,307        48,809
                                                                ----------     ----------    ----------
   Total Liabilities                                             5,267,898      4,657,836     4,577,981
Shareholders' Equity:
   Preferred Stock-$10 par value; 1,000,000 shares authorized
      but none issued                                                    0              0             0
   Common Stock-$10 par value; 70,000,000 shares authorized,
      Issued 39,062,296 shares at September 30, 1998;
      36,330,605 shares at December 31, 1997;
      36,228,395 shares at September 30, 1997                      390,623        363,306       362,284
   Capital Surplus                                                  94,019         71,782        71,834
   Retained Earnings                                               189,425        157,730       146,658
   Accumulated Other Comprehensive Income                            9,552          5,927         4,929
   Treasury Stock - 4,346,846 shares at September 30, 1998
      and December 31, 1997; 4,211,746 shares
      at September 30, 1997; at cost                               (95,095)       (95,095)      (89,851)
                                                                ----------     ----------    ----------
      Total Shareholders' Equity                                   588,524        503,650       495,854
                                                                ----------     ----------    ----------
      Total Liabilities and Shareholders' Equity                $5,856,422     $5,161,486    $5,073,835
                                                                ==========     ==========    ==========
</TABLE>
<PAGE>
<TABLE>
ONE VALLEY BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income
(unaudited in thousands, except per share data)
<CAPTION>

                                                                    For The Three Months        For The Nine Months
                                                                     Ended September 30          Ended September 30
                                                                     1998          1997          1998         1997
<S>                                                                <C>            <C>          <C>          <C>
INTEREST INCOME
   Interest and Fees on Loans
      Taxable                                                      $82,050        $70,020      $232,549     $205,790
      Tax-Exempt                                                       675            765         2,030        2,253
                                                                   -------       --------      --------     --------
            Total                                                   82,725         70,785       234,579      208,043
   Interest on Investment Securities
      Taxable                                                       21,897         21,155        67,626       62,189
      Tax-Exempt                                                     3,118          2,990         9,239        8,988
                                                                  --------       --------      --------     --------
            Total                                                   25,015         24,145        76,865       71,177
   Other Interest Income                                               497            452         1,169        1,299
                                                                  --------       --------      --------     --------
            Total Interest Income                                  108,237         95,382       312,613      280,519
INTEREST EXPENSE
   Deposits                                                         41,356         37,713       119,316      110,156
   Short-term Borrowings                                             9,681          6,756        27,801       18,226
   Long-term Borrowings                                                632            880         2,037        2,543
                                                                  --------       --------      --------     --------
      Total Interest Expense                                        51,669         45,349       149,154      130,925
                                                                  --------       --------      --------     --------
Net Interest Income                                                 56,568         50,033       163,459      149,594
Provision For Loan Losses                                            2,593          1,999         7,481        5,291
                                                                  --------       --------      --------     --------
Net Interest Income
   After Provision For Loan Losses                                  53,975         48,034       155,978      144,303
OTHER INCOME
   Trust Department Income                                           2,762          2,557         8,722        7,733
   Service Charges on Deposit Accounts                               5,051          3,834        14,087       11,359
   Real Estate Loan Processing & Servicing Fees                      2,289          1,508         6,300        4,281
   Other Service Charges and Fees                                    3,796          2,774        10,236        8,020
   Other Operating Income                                            1,163          1,818         3,940        3,926
   Securities Transactions                                             266            230           989          377
                                                                  --------       --------      --------     --------
      Total Other Income                                            15,327         12,721        44,274       35,696
OTHER EXPENSES
   Salaries and Employee Benefits                                   20,189         18,223        58,943       54,549
   Occupancy Expense - Net                                           2,161          1,872         6,105        5,422
   Equipment Expenses                                                2,955          2,348         8,494        6,851
   Outside Data Processing                                           2,333          1,995         7,527        6,104
   Other Operating Expenses                                         13,270         10,869        38,267       31,413
                                                                  --------       --------      --------     --------
      Total Other Expenses                                          40,908         35,307       119,336      104,339
                                                                  --------       --------      --------     --------
Income Before Taxes                                                 28,394         25,448        80,916       75,660
Applicable Income Taxes                                              9,409          8,709        27,401       25,876
                                                                  --------       --------      --------     --------
NET INCOME                                                         $18,985        $16,739       $53,515      $49,784
                                                                  ========       ========      ========     ========
NET INCOME PER SHARE
   Basic                                                           $  0.56        $  0.53       $  1.63      $  1.56
   Diluted                                                         $  0.55        $  0.51       $  1.60      $  1.52
Average Shares Outstanding (in thousands)
   Basic                                                            34,058         31,799        32,891       31,973
   Diluted                                                          34,635         32,504        33,513       32,668


</TABLE>
<PAGE>
<TABLE>
ONE VALLEY BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Shareholders' Equity
(unaudited in thousands)
<CAPTION>

                                                                                                           Accumulated
                                                                                                              Other
                                                     Common        Capital       Retained      Treasury   Comprehensive
                                                      Stock        Surplus       Earnings        Stock        Income      Total
<S>                                                 <C>            <C>           <C>           <C>            <C>        <C>    
Balance December 31, 1997                           $363,306       $71,782       $157,730      ($95,095)      $5,927     $503,650
Nine Months Ended September 30, 1998
   Comprehensive Income:
      Net Income                                           0             0         53,515             0            0       53,515
      Other Comprehensive Income, net of tax:
         Net Unrealized Holding Gains on
           Available-For-Sale Securities Arising
            During The Period                              0             0              0             0        4,218        4,218
         Less:  Reclassification Adjustment For
            Gains Realized in Net Income                   0             0              0             0         (593)        (593)
                                                                                                                         --------
      Other Comprehensive Income                                                                                            3,625
                                                                                                                         --------
   Comprehensive Income                                                                                                    57,140
   Cash Dividends ($.66 per share)                                                (21,820)                                (21,820)
   FFVA Treasury Shares Reissued                       7,087        19,274              0             0            0       26,361
   Issuance of common stock (1,826,637)               18,264         2,260                                                 20,524
   Stock Options Exercised                             1,966           703              0             0            0        2,669
                                                    --------      --------       --------      --------     --------     --------
Balance September 30, 1998                          $390,623       $94,019       $189,425      ($95,095)      $9,552     $588,524
                                                    ========      ========       ========      ========     ========     ========


Balance December 31, 1996                           $298,504       $66,641       $183,226      ($67,378)      $2,065     $483,058
Nine Months Ended September 30, 1997
   Comprehensive Income:
      Net Income                                           0             0         49,784             0            0       49,784
      Other Comprehensive Income, net of tax:
         Net Unrealized Holding Gains on
            Available-For-Sale Securities Arising
            During The Period                              0             0              0             0        3,090        3,090
         Less:  Reclassification Adjustment For
            Gains Realized in Net Income                   0             0              0             0         (226)        (226)
                                                                                                                         --------
      Other Comprehensive Income                                                                                            2,864
                                                                                                                         --------
   Comprehensive Income                                                                                                    52,648
   Cash Dividends ($.59 per share)                         0             0        (17,789)            0            0      (17,789)
   Five for Four Stock Split                          62,960                      (62,960)                                    -  
   FFVA Repurchase of Common Stock                    (1,795)        3,652         (5,603)            0            0       (3,746)
   Treasury Shares Purchased                               0             0              0       (22,473)           0      (22,473)
   Stock Options Exercised                             2,615         1,541              0             0            0        4,156
                                                    --------      --------       --------      --------     --------     --------
Balance September 30, 1997                          $362,284       $71,834       $146,658      ($89,851)      $4,929     $495,854
                                                    ========      ========       ========      ========     ========     ========
</TABLE>
<PAGE>
<TABLE>
ONE VALLEY BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(unaudited in thousands)
<CAPTION>
                                                                                   For The Nine Months
                                                                                   Ended September 30
                                                                                    1998          1997
<S>                                                                               <C>           <C>
OPERATING ACTIVITIES
   Net Income                                                                     $53,515       $49,784
   Adjustments To Reconcile Net Income To Net Cash
      Provided by Operating Activities:
         Provision For Loan Losses                                                  7,481         5,291
         Depreciation                                                               7,611         6,473
         Amortization and Accretion                                                 4,330         2,792
         Net Gain From Sales of Assets                                               (989)         (363)
         Increase (Decrease) Due to Changes In:
            Accrued Interest Receivable                                            (2,220)         (694)
            Accrued Interest Payable                                               (2,671)        2,086
            Other Assets and Other Liabilities                                      9,572        (2,842)
                                                                                 --------      --------
            Net Cash Provided by Operating Activities                              76,629        62,527

INVESTING ACTIVITIES
   Proceeds From Sales of Securities Available for Sale                            53,045        37,974
   Proceeds From Maturities of Securities Available for Sale                      391,849       238,639
   Proceeds From Maturities of Securities Held to Maturity                         25,062        24,470
   Purchases of Securities Available for Sale                                    (404,463)     (387,425)
   Purchases of Securities Held to Maturity                                       (21,567)      (59,178)
   Net Increase In Loans                                                         (328,241)      (95,004)
   Acquisition of Branches and Subsidiary, Net of Cash Received                   118,371             0
   Purchases of Premises and Equipment                                             (9,763)       (6,401)
                                                                                 --------      --------
            Net Cash Used in Investing Activities                                (175,707)     (246,925)

FINANCING ACTIVITIES
   Net Increase in Interest Bearing and Non-interest Bearing Deposits              34,857        75,288
   Net Increase in Federal Funds Purchased                                         20,344        37,472
   Net Increase in Other Short-term Borrowings                                     96,492       121,395
   Proceeds From Long-term Borrowings                                                   0        25,000
   Repayment of Long-term Debt                                                    (12,018)       (2,015)
   Proceeds From Issuance of Common Stock                                          29,028         4,156
   Repurchase of FFVA Common Stock                                                      0        (3,746)
   Purchase of Treasury Stock                                                           0       (22,473)
   Dividends Paid                                                                 (21,820)      (17,789)
                                                                                 --------      --------
            Net Cash Provided by Financing Activities                             146,883       217,288
                                                                                 --------      --------
              Increase in Cash and Cash Equivalents                                47,805        32,890

Cash And Cash Equivalents at Beginning of Year                                    149,484       167,508
                                                                                 --------      --------
Cash And Cash Equivalents, September 30                                          $197,289      $200,398
                                                                                 ========      ========
</TABLE>





<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note A - Basis of Presentation

The accounting and reporting policies of One Valley conform to generally 
accepted accounting principles and practices in the banking industry.  The 
preparation of the financial statements in conformity with generally accepted 
accounting principles requires management to make estimates and assumptions 
that affect the amounts reported in the financial statements and accompanying 
notes.  Actual results could differ from those estimates.  All significant 
intercompany accounts and transactions have been eliminated in consolidation.  
The interim financial information included in this report is unaudited.  In 
the opinion of management, all adjustments necessary for a fair presentation 
of the results of the interim periods have been made.  These notes are 
presented in conjunction with the Notes to Consolidated Financial Statements 
included in the Annual Report of One Valley.

Note B - Accounting Change

In February 1997, the Financial Accounting Standards Board (FASB) issued 
Statement No. 128, "Earnings Per Share" (FAS 128) which supercedes APB Opinion 
No. 15, "Earnings Per Share" (APB 15).  FAS 128 is effective for financial 
statements for both interim and annual periods ending after December 15, 1997.  
Statement 128 requires the reporting of basic and diluted net income per 
common share.  Basic net income per common share excludes any dilutive effects 
of stock options and is computed by dividing net income by the average common 
shares outstanding during the year.  Diluted net income per common share is 
computed by dividing net income by the average common shares outstanding 
during the year adjusted for the dilutive effect of options under One Valley's 
stock option plans.  The effect of dilutive stock options on average shares 
outstanding was 577,000 and 705,000 for the third quarter of 1998 and 1997 
respectively, while the effect was 622,000 and 695,000 for the nine months 
ended September 30, 1998 and 1997, respectively.  Net income per common share 
amounts for all periods presented have been restated to conform to Statement 
128. 

In June 1997, the FASB issued Statement No. 131, "Disclosures About Segments 
of an Enterprise and Related Information," which is effective for fiscal years 
beginning after December 15, 1997.  This statement requires public companies 
to disclose certain information about reportable operating segments in 
complete sets of financial statements of the company and in interim condensed 
financial statements.  However, the provision of this statement do not require 
the disclosure of segment information in interim financial statements in the 
initial year of application, therefore, no such disclosures are required 
herein.  These disclosure requirements will have no effect on One Valley's 
financial position or results of operations.

As of January 1, 1998, the One Valley adopted FASB Statement No. 130, 
"Reporting Comprehensive Income" (FAS 130).  FAS 130 establishes new rules for 
the reporting and display of comprehensive income and its components; however, 
the adoption of this Statement had no impact on One Valley's net income or 
shareholders' equity.  FAS 130 requires unrealized gains or losses on the One 
Valley's available-for-sale securities, which prior to adoption were reported 
separately in shareholders' equity, to be included in other comprehensive 
income.  Prior period financial statements have been reclassified to conform 
to the requirements of FAS 130.  During the third quarter of 1998 and 1997, 
total comprehensive income amounted to $22,942 and $19,953, respectively.

As of January 1, 1998, One Valley adopted the provision of FASB Statement No. 
125, "Accounting for Transfers and Servicing of Financial Assets and 
Extinguishment of Liabilities," relating to repurchase agreements, securities 
lending, and other similar transactions and pledged collateral, which had been 
delayed by FASB statement 127 "Deferral of the Effective Date of Certain 
Provisions of FASB Statement 125, an Amendment of FASB Statement 125."  The 
effect of adopting the additional provisions of Statement 125, as amended by 
Statement 127, had no material impact on One Valley's financial position or 
results of operations.

In June 1998, the FASB issued Statement No. 133,  "Accounting for Derivative 
Instruments and Hedging Activities," (FAS 133) which requires all derivatives 
to be recorded on the balance sheet at fair value and establishes "special" 
accounting for fair value, cash flow, and foreign currency hedges.  FAS 133 is 
effective for years beginning after June 15, 1999 and the impact of adopting 
this statement in year 2000 cannot be determined at this time.

Note C - Mergers and Acquisitions

At the close of business on March 30, 1998, One Valley acquired all of the 
outstanding stock of FFVA Financial Corporation, in exchange for 5,518,668 
shares of One Valley common stock.  This combination was accounted for as a 
pooling-of-interests.  Accordingly, all prior period financial information has 
been restated to reflect the merger of the two companies as though they had 
always been combined.

At the close of business on August 7, 1998, One Valley acquired all of the 
outstanding stock of Summit Bankshares, Inc., in exchange for 1,826,637 shares 
of One Valley common stock.  The transaction was accounted for as a pooling-
of-interests.  However, the balances and results of operations of Summit 
Bankshares have been included in the financial statements of One Valley only 
from the date of acquisition due to the relative size of Summit to One Valley.

<PAGE>
One Valley Bancorp, Inc.

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

September 30, 1998


INTRODUCTION AND SUMMARY

      Net income for the third quarter of 1998 totaled $19.0 million, a 13.4% 
increase over the $16.7 million earned in the same quarter of 1997.  On a per 
share basis, basic net income per share increased by 5.7% to $0.56 from the 
$0.53 earned in the third quarter of 1997.  The improvement in earnings during 
the quarter is primarily due to higher net interest income and non-interest 
income which more than offset the increase in non-interest expense.

      Net income for the first nine months of 1998 totaled $53.5 million, a 
7.5% increase over the $49.8 million earned in the first nine months of 1997.  
On a per share basis, basic net income per share for the nine-month period was 
$1.63, a 4.5% increase from the $1.56 reported for the first nine months of 
1997.  First quarter 1998 earnings were lowered by approximately $0.03 per 
share due to the impact of one-time charges connected with the acquisition of 
FFVA Financial Corporation in Lynchburg, Virginia.
  
      Return on average assets (ROA) measures how effectively One Valley 
utilizes its assets to produce net income.  ROA was 1.28% for the first nine 
months of 1998, a decrease from the 1.35% earned during the same period of 
1997.  Return on average equity (ROE) also decreased to 13.05% from the 13.64% 
reported for the third quarter of 1997.  The decline in ROA and ROE was 
primarily the result of acquisition activity during 1998 as more fully 
explained below.  

      The following discussion is an analysis of the financial condition and 
results of operations of One Valley for the first nine months of 1998.  This 
discussion should be read in conjunction with the 1997 Annual Report to 
Shareholders and the other financial information included in this report.


Acquisitions 

      At the close of business on February 19, 1998, One Valley acquired 
fifteen branches in central Virginia.  Through this purchase One Valley 
acquired $124.9 million in loans and $283.2 million in deposits.  This 
transaction was treated as a purchase and accordingly, the balances and 
results of the operations of the branches are included in the financial 
statements of One Valley only from the date of purchase.  Also, at the close 
of business on March 30, 1998, One Valley Bancorp merged with FFVA Financial 
Corporation, a $580.0 million bank headquartered in Lynchburg, Virginia.  
Pursuant to the merger agreement, One Valley exchanged 1.05 shares of One 
Valley Bancorp stock for each share of FFVA Financial common stock 
outstanding. The combination was accounted for as a pooling-of-interests and 
as a result, all prior financial results have been restated and reported on a 
combined basis.  In addition, on August 7, 1998, One Valley acquired Summit 
Bankshares, Inc. a $199.7 million bank holding company operating nine branches 
in Virginia with $148.7 million in total loans and $181.4 million in deposits.  
The transaction was accounted for as a pooling-of-interest.  However, the 
balances and results of operations of Summit are included in the financial 
statements of One Valley only from the date of acquisition due to the relative 
size of Summit and One Valley.  


RESULTS OF OPERATIONS

Net Interest Income

      Net interest income for the nine months ended September 30, 1998, was 
$169.5 million on a fully tax-equivalent basis, an 8.9% increase over the 
$155.6 million earned during the same period in 1997.  This increase is 
largely due to a $444.8 million or 14.1% increase in average total loans and a 
$174.5 million or 12.0% increase in average securities during the first nine-
month comparison.  In total, average earning assets increased by $609.1 
million or 13.2% in the first nine months of 1998 over the same period in 
1997, while average interest bearing liabilities increased by $503.7 million 
or 12.6% in the same period.  Both total interest income and total interest 
expense increased from the prior year due to the increases in volume and 
changes in the mix of assets and liabilities.  Approximately one-third of the 
growth in average earning assets was attributable to the acquisition activity 
during 1998.
 
      As shown in the consolidated average balance sheets (page 22), the yield 
on earning assets declined to 8.16% for the first nine months of 1998 from 
8.31% earned during the same period in 1997.  During the same period, the cost 
of interest bearing liabilities increased five basis points to 4.44% from last 
year's 4.39% level.  The slight increase in cost of funds has resulted from a 
planned increase in short-term borrowed funds.  The cost of interest-bearing 
deposits has not declined as rapidly as earning asset yields due to higher 
costs to attract customer deposits in an increasingly competitive market.  
Additional discussion of the changes in balance sheet mix is included later in 
this report.  With the lower yield earned on earning assets and the higher 
cost of interest bearing liabilities, the net interest margin decreased to 
4.34% during the first nine months of 1998, from the 4.51% during the first 
nine months of 1997.  Internal interest rate risk simulations indicate that 
over the next twelve months a sharp rise in interest rates would have a slight 
positive influence on net interest income; whereas, a sharp decline in rates 
would have a slight negative influence on net interest income.  Normal 
fluctuations in market interest rates should not have a significant impact on 
One Valley's net interest margin.


Credit Experience

      The provision for loan losses was $7.5 million for the nine months ended 
September 30, 1998, a $2.2 million increase from the provision made during the 
same period of 1997.  As a percentage of average total loans, the provision 
for loan losses through the first nine months of 1998 was 0.28% on an 
annualized basis, compared with 0.22% for the same period of 1997.  The 
increase in the provision for loan losses was based upon One Valley's 
continual evaluation process of the adequacy of the allowance for loan losses 
and to provide for the increase in the portfolio as a result of the loans 
acquired through acquisitions in 1998.  Net charge-offs as a percentage of 
average total loans in the first nine months of 1998 decreased to 0.17% on an 
annualized basis, down from an annualized 0.22% during the same period in 
1997, and from the 0.24% charge-off ratio for the full year of 1997.  The 
decrease is primarily due to a lower volume of consumer installment charge-
offs.

      Total non-performing assets at September 30, 1998, were 0.23% of period-
end loans, down from the 0.30% at December 31, 1997 and 0.38% at September 30, 
1997.  Non-accrual loans totaled $7.2 million at September 30, 1998, $3.6 
million or 33.1% below last year's level resulting in a decline in total non-
performing assets from the level one year ago.  The allowance for loan losses 
is sufficient to absorb nearly six times the amount of those non-performing 
assets.  At September 30, 1998, loans past due over 90 days were 0.22% of 
outstanding loans, up from the 0.19% at year-end 1997 and up from the 0.20% at 
September 30, 1997.  An analysis of the allowance for loan losses and non-
performing assets is included on page 21. 

      With the continued growth of loans outstanding, the allowance for loan 
losses in relationship to loans outstanding has declined to 1.33% at September 
30, 1998 compared to 1.36% at year-end and 1.40% one year ago.   In 
management's opinion, the allowance for loan losses is adequate to absorb the 
current estimated risk of loss in the existing loan portfolio.


Non-Interest Income and Expense

      The net overhead ratio (non-interest expense less non-interest income 
excluding security transactions divided by average earning assets) is a 
measure of One Valley's ability to control costs and equalizes the comparison 
of various sized operations.  As this ratio decreases, more of the net 
interest margin flows to net income.  One Valley's net overhead ratio for the 
first nine months of 1998 was 1.94%, down from 2.09% during all of 1997 and 
down slightly from the 2.00% for the first nine months of 1997.  The 
improvement in the net overhead ratio during the first nine months of 1998 was 
the result of a 13.2% growth in average earning assets from one year ago while 
net overhead increased by 10.2% from the same period in 1997. The increase in 
net overhead is primarily due to the operations of the fifteen branches 
purchased in February and the nine locations acquired through the merger of 
Summit Bankshares along with the expenses related to the FFVA merger.

      Total non-interest income excluding securities transactions was $43.3 
million through the first nine months of 1998, up 22.6% from the $35.3 million 
non-interest income earned during the same period in 1997.  Trust income 
increased by 12.8% from the same period last year due to new business and 
increases in the market value of trust assets managed.  Service charges on 
deposit accounts increased by 24.0% in the first nine-month comparison mainly 
due to a higher level of customer activity from the twenty-four new branches 
(which include the fifteen purchased in February and the nine acquired through 
the Summit merger in August) acquired in Virginia in 1998.  Real estate loan 
processing and service fees increased by 47.2% when compared to the first nine 
months of 1997 due to a higher level of residential mortgage loans sold in the 
secondary market and the increased refinancing activity by customers taking 
advantage of the lower interest rate environment. Other service charges and 
fees increased by 27.6% over the first nine months of 1997, primarily due to 
increases in credit/debit card activity and other banking services provided to 
customers.  

      Total non-interest expense was $119.3 million during the nine months 
ended September 30, 1998, a 14.4% increase from the $104.3 million during the 
same period in 1997. This increase is largely due to the operations of the 
fifteen branches acquired during the first quarter, the nine branches acquired 
through the Summit merger, and the one time expenses related to the 
acquisition of FFVA.  Staff costs increased by 8.1% from the level one-year 
ago primarily due to the additional staff from the new branches and normal 
salary and benefit increases. Occupancy expense increased by 12.6% from the 
same period last year principally due to the increased facilities cost related 
to the twenty-four new branches.  Equipment expenses increased 24.0% from last 
year's level primarily due to higher maintenance and depreciation costs 
related to technology upgrades that occurred in 1997 and are continuing in 
1998. Outside data processing expense increased by 23.3% from the same period 
in 1997.  This increase is due to conversion and processing costs associated 
with the expansion of operations in Virginia and the processing costs related 
to the increased activity of the Visa Checkcard and ATM products.  Other 
operating expenses increased by $6.9 million or 21.8% in the first nine months 
of 1998.  One-sixth ($1.1 million) of the increase was directly related to 
one-time charges for investment banking and legal fees related to the FFVA 
merger.  The remainder was primarily due to increases in advertising expense 
and other expenses associated with the operations of the twenty-four new 
branches.

      Income tax expense increased by $1.5 million, or 5.9%, for the first 
nine months of 1998 compared with the same period in 1997.  The increase in 
taxes is primarily a result of the 6.9% growth in pretax earnings.  One 
Valley's effective income tax rate for the first nine months of 1998 was 33.9% 
compared to 34.2% during the first nine months of 1997.


FINANCIAL CONDITION

Asset Structure

      Total loans at September 30, 1998, exceeded September 30, 1997 levels by 
20.9% or $675.0 million.  Since year-end 1997, total loans have increased by 
18.2% or $600.0 million. The consolidated loan-to-deposit ratio has increased 
to 88.0% at September 30, 1998, compared to 83.2% at September 30, 1997.  
Approximately $124.9 million in loans were acquired through the fifteen 
branches purchased during the first quarter of 1998 and $148.7 million were 
acquired through the merger with Summit Bankshares.  The increase in total 
loans is primarily in one-to-four family, home equity loans, commercial real 
estate loans, and consumer auto loans.

      Investment portfolio assets increased $7.1 million or 0.5% from the 
level at year-end and by $63.7 million or 4.2% from the level one-year ago. 
One Valley acquired approximately $108.2 million of investable funds through 
the fifteen branches purchased. These funds were primarily invested in 
government agency and mortgage backed securities. These investment decisions 
were made in accordance with One Valley's asset/liability strategy, which 
strives to minimize interest rate risk while enhancing the financial position 
of the Company.  Since that time, maturing investments have been used to fund 
the strong loan growth.

      Securities designated as available-for-sale at September 30, 1998, had a 
historical cost of $1.305 billion, with an unrealized gain of approximately 
$15.4 million.  This unrealized gain increased shareholders' equity by $9.6 
million, net of $5.8 million in deferred income taxes.  At year-end December 
31, 1997, and September 30, 1997, securities available-for-sale had a 
historical cost of $1.207 billion and $1.170 billion, with an unrealized gain 
of approximately $9.7 million at year-end, and an unrealized gain of 
approximately $8.1 million at September 30, 1997.  The unrealized gains 
increased shareholders' equity by $5.9 million and $4.9 million, net of $3.8 
and $3.2 million in deferred income taxes, respectively.

      On March 30, 1998, in accordance with the provisions in FAS Statement 
115, One Valley reclassified as available-for-sale approximately $96.2 million 
of investments that were previously categorized as held-to-maturity by FFVA.  
The reclassification enabled One Valley to incorporate FFVA's investment 
portfolio into its own investment policy and asset/liability management 
strategies.  At the date of transfer, these securities had a carrying value of 
$95.3 million with an unrealized gain of approximately $0.9 million. 
Similarly, on August 7, 1998, One Valley reclassified as held-to-maturity 
approximately $6.9 million of investments that were previously categorized as 
available-for-sale by Summit Bankshares.  The reclassification enabled One 
Valley to incorporate Summit's investment portfolio into its own investment 
policy and asset/liability management strategies.  At the date of transfer, 
these securities had a carrying value of $6.8 million with an unrealized gain 
of approximately $0.1 million. 

      At the time of purchase, management determines the appropriate 
classification of securities.  Securities to be held for indefinite periods of 
time and not intended to be held to maturity or on a long-term basis are 
classified as available-for-sale and carried at fair value.  The corresponding 
difference between the historical cost and the current fair value of these 
securities, the unrealized gain or loss, is an adjustment to shareholders' 
equity, net of deferred income taxes.  Securities available-for-sale include 
securities that management intends to use as part of its asset/liability 
management strategy and that may be sold in response to changes in interest 
rates, resultant prepayment risk, and other related risk factors.  If 
management has the positive intent and One Valley has the ability at the time 
of purchase to hold securities until maturity, they are classified as held-
for-investment and carried at amortized historical cost adjusted for 
amortization of premiums and accretion of discounts, which are recognized as 
adjustments to interest income.

      In order to improve its fully tax equivalent net interest income and to 
hedge against higher income tax rates, One Valley increased its holdings of 
tax-exempt securities that were offering attractive yields over the last 
several years.  As shown on the consolidated average balance sheets (page 22), 
average tax-exempt securities in the first nine months of 1998 increased by 
4.9% or $11.0 million over the average during the first nine months of 1997.  
One Valley will continue to monitor its investment opportunities and may 
purchase additional tax-exempt securities of similar yield and quality.

      Federal funds sold at September 30, 1998, were $48.0 million, up $27.6 
million from year-end but down only slightly from one year ago.  Fluctuations 
in federal funds sold are normal and largely due to planned changes in the 
Company's asset/liability structure in order to maximize the return on 
investment in response to changes in the interest rate environment.


Liability Structure

      Total deposits at September 30, 1998, increased by $499.4 million or 
12.7% from the level at year-end and $553.2 million or 14.3% since September 
30, 1997.  Approximately $464.6 million of the increase in total deposits was 
attributable to the acquisition activity in 1998.  Over the past few years, 
growth in banking deposits has been modest.  Due to the current low interest 
rate environment compared to the early 1990's, deposit customers are 
shortening the maturities of their deposit reinvestments and seeking higher 
yielding non-traditional investment alternatives.  The majority of the growth 
in One Valley's core deposits, exclusive of the new branches, has been in 
money market and Valley index accounts. The average rate paid on interest 
bearing deposits was 4.29% in the first nine months of 1998, relatively 
unchanged from the 4.31% average rate paid for all of 1997, and the 4.30% 
average rate paid in the first nine months of 1997.  In an effort to meet 
customer expectations for an integrated financial service delivery system, One 
Valley also operates a fully licensed NASD Broker/Dealer subsidiary, an 
Insurance Agency subsidiary and continues to expand other product lines.

      Total short-term borrowings increased by $116.8 million or 18.7% from 
the year-end level, and increased $145.4 million or 24.4% from the level at 
September 30, 1997.  Short-term borrowings consist of Federal funds purchased 
from correspondent banks, repurchase agreements with large corporate and 
public entities, advances on credit lines available to One Valley, and 
commercial paper.  The increased level of short-term borrowings has been used 
to fund the loan growth and the higher level of investment portfolio assets as 
planned under One Valley's asset/liability management program.  The average 
rate paid on these short-term borrowings has also increased from 4.85% during 
the first nine months of 1997 to 5.14% during the same period of 1998.

      Long-term borrowings decreased $16.8 million or 31.2% since September 
30, 1997, primarily as a result of payments on long-term advances from the 
Federal Home Loan Bank (FHLB).  As a result, One Valley now has $37.1 million 
of long-term borrowings, primarily FHLB borrowings, with repayment schedules 
from one to six years.


Capital Structure and Liquidity

      One Valley's equity-to-asset ratio was 10.0% at September 30, 1998, up 
from the 9.8% at December 31, 1997 and at September 30, 1997.  One Valley's 
commitment to a strong capital ratio has facilitated the company's expansion 
into the central Virginia markets thus increasing prospects for improving 
long-term profitability and shareholder value.  One Valley's cash dividend, 
totaling $0.24 per share for the third quarter of 1998, was up 14.3% over the 
$0.21 per share dividend during the same period in 1997.  One Valley's 
dividend policy, coupled with the continued growth in net income, demonstrates 
management's commitment to a strong equity-to-asset ratio benefiting both the 
investor and the customer in the local community.  One Valley's risk based 
capital ratio at September 30, 1998 was 15.33%, well above the 8.0% required, 
while its Tier I capital ratio was 14.08%.  One Valley's strong capital 
position is demonstrated further by its leverage ratio of 9.01% compared to 
regulatory guidance of 4.0% to 5.0%.  The capital ratios of the banking 
subsidiaries also remain strong and allow them to effectively serve the 
communities in which they are located.

      In order to account for the FFVA merger under the pooling-of-interests 
method of accounting, FFVA Corporation reissued 675,000 treasury shares in a 
private placement offering.  As a result, approximately $26.4 million of 
additional equity was raised in the first quarter of 1998. 

      The capital positions of the banks, coupled with proper asset/liability 
matching and the stable nature of the primarily consumer base of core 
deposits, results in the maintenance of a strong liquidity position.  The 
liquidity of the parent company is dependent upon dividends from its banking 
subsidiaries, which, although restricted by banking regulations, are adequate 
to meet its cash needs. 


Effects of Changing Prices

      The results of operations and financial condition presented in this 
report are based on historical cost, unadjusted for the effects of inflation.  
Inflation affects One Valley in two ways.  One is that inflation can result in 
increased operating costs, which must be absorbed or recovered through 
increased prices for services.  The second effect is on the purchasing power 
of the corporation.  Virtually all of a bank's assets and liabilities are 
monetary in nature.  Regardless of changes in prices, most assets and 
liabilities of the banking subsidiaries will be converted into a fixed number 
of dollars.  Non-earning assets, such as premises and equipment, do not 
comprise a major portion of One Valley's assets; therefore, most assets are 
subject to repricing on a more frequent basis than in other industries.  One 
Valley's ability to offset the effects of inflation and potential reductions 
in future purchasing power depends primarily on its ability to maintain 
capital levels by adjusting prices for its services and to improve net 
interest income by maintaining an effective asset/liability mix. 


YEAR 2000 READINESS DISCLOSURE

Introduction

      One Valley recognizes the significant potential risk associated with the 
"Year 2000" (Y2K) issue and the challenge its poses.  The Y2K problem arose 
because many existing computer programs use only the last two digits to refer 
to a year.  Therefore, these computer programs do not properly recognize a 
year that begins with 20XX instead of 19XX.  Beginning January 1, 2000, 
computer applications that use dates for computations, comparisons and sorting 
may produce incorrect results or fail due to an invalid interpretation of the 
date.  The potential risk is not limited to computers and related software 
applications, but extends to telephones, security systems, copiers, FAX 
machines or any apparatus that utilizes computer technology.  The full extent 
of the potential impact of Y2K is not yet known, but it could adversely affect 
national and global economies.  

       As a financial institution, the ability of One Valley to promptly and 
accurately capture, record, process and communicate its customers' financial 
transactions and related data is vital to its ongoing operations.  The Y2K 
problem could impede One Valley's ability to do so in several significant 
respects.  Recognizing this potential risk, One Valley has undertaken a 
comprehensive project to address the Year 2000 issues that may affect One 
Valley and its customers.  One Valley's preparations began in late 1996 under 
the guidance of Management and with oversight by the Board of Directors.  


Project Overview

       One Valley's project includes five phases: Awareness, Assessment, 
Renovation (or remediation), Validation (or testing), and Implementation.  The 
Awareness Phase consisted of formal updates to One Valley management, 
employees and the Board of Directors about the issues relating to Y2K.  In 
this stage management gathered information and attended conferences, appointed 
a project steering team and coordinators, began preliminary discussions with 
third party vendors, and distributed preliminary information to its employees 
and customers.  This phase was completed in October, 1997, however One Valley 
continues on-going efforts to keep its customers and employees up to date.

       In the Assessment Phase, One Valley identified its critical information 
technology (IT) systems and performed a company-wide inventory of all systems, 
software, hardware, equipment and components that potentially could be 
affected by Y2K.  During this phase, One Valley established project time 
lines, allocated resources and established the methodology to monitor the Y2K 
readiness of the IT systems provided by third parties, as well as its non-IT 
systems.  One Valley also determined the Y2K readiness of its in-house IT 
systems and components, and reported progress to senior management and the 
Board of Directors on a regular basis.  During this phase, One Valley 
identified four general areas of potential susceptibility to Y2K issues: Major 
IT Systems provided by third parties, Internal IT Systems, Non-IT Systems, 
including communications infrastructure and physical facilities, and customer 
business interruption.  The Assessment Phase was completed in the fourth 
quarter of 1997. 

       In the Renovation Phase, One Valley's third-party IT providers 
implemented program changes to accommodate the Y2K issues and conducted 
internal testing, which was substantially completed in the third quarter of 
1998.  In addition, during this phase One Valley began reprogramming its 
internal IT and non-IT systems to accommodate Y2K.  It also focused on its 
customers' readiness for and susceptibility to Y2K concerns.  One Valley 
anticipates this phase will be completed by the second quarter of 1999.

       In the Validation Phase, One Valley and its third party IT providers 
will perform testing on the renovated applications and components to make sure 
they are Y2K ready.  This phase is expected to be very active during late 1998 
and early 1999.  Once validated, One Valley and its service providers will 
begin the Implementation Phase.  During this phase, the applications, systems 
and other components will be fine-tuned and final programs put into production 
prior to January 1, 2000.  The major portion of this final phase will not be 
complete until the second quarter of 1999.  


Project Status

      Most of One Valley's major IT Systems are processed by the largest third 
party service providers in the world, which have indicated to One Valley that 
they have adequate resources to perform Y2K remediation, testing and 
implementation, and are leading firms in their respective lines of business. 
The major IT systems provided by third parties include mortgage loans, credit 
cards, commercial and installment loans, and deposits.  One Valley has been 
informed by these third parties that these systems have each been renovated, 
are in various stages of testing and implementation, and will be placed into 
production at the earliest possible time.  One Valley has continually 
monitored the Y2K progress of these third parties and has determined that 
progress to date is acceptable, with validation of these primary third party 
systems anticipated to be completed by the first quarter of 1999.  Two other 
IT systems provided by third parties which provide investment and trust 
services are substantially renovated, with testing and implementation 
scheduled to occur during the first half of 1999. 

      One Valley's Internal IT Systems are primarily used to capture and 
prepare data to be transmitted to its third party IT Systems providers.  One 
Valley is in various stages of renovating, validating and implementing these 
systems, with completion anticipated during the second quarter of 1999.  In 
addition, One Valley has a total of 280 ATMs in its network; all but 49 of 
which have been validated.  These will be upgraded for Y2K by the end of 1998.  
One Valley's IT systems also include personal computers, network servers, 
routers and related software.  The upgrading or replacement of this 
infrastructure is 80% to 90% complete and is expected to be finished by the 
first quarter of 1999.  

      Another important part of One Valley's operations includes its non-IT 
systems, primarily facilities and equipment.  Basic utilities, such as 
telephone, gas and electrical service, as well as heating and cooling systems 
could be adversely affected by the Y2K.  One Valley has performed a complete 
inventory of its facilities and has tested or developed plans to test, to the 
extent possible, applicable equipment for Year 2000 compliance.  Outside 
companies, primarily utilities, which provide these services, have indicated 
to One Valley that they are Y2K ready, and to date One Valley is not aware of 
any non-IT system provider with a Y2K issue that would materially impact One 
Valley's operations.  However, One Valley has no means of insuring or 
verifying that these non-IT systems will be Y2K ready, and the impact of a 
failure in these systems is not determinable.

      Another area that could potentially impact One Valley is interruption of 
its customers' business, which among other things could potentially affect the 
ability of its commercial loan and other customers to repay loans from One 
Valley, thus increasing One Valley's delinquency ratios, non-performing assets 
and loans losses.  To help minimize these problems and heighten customer 
awareness, One Valley has established a Y2K Corporate Customer Action Plan.  
As part of this plan, One Valley has mailed Year 2000 brochures to all 
commercial customers, hosted Y2K information seminars featuring a nationally 
known expert for its customers, made FDIC Year 2000 brochures available in the 
lobby of all its branches, and published a Year 2000 questions and answer 
sheet.  One Valley has also incorporated a Y2K readiness assessment in its 
credit risk evaluations of corporate borrowers.  As of June 30, 1998, 
corporate borrowers were preliminarily assessed as to their Year 2000 
readiness.  A full assessment of medium and high risk customers and industries 
will be completed by the middle of the fourth quarter 1998.  Those customers 
and industries judged to be high risk will be closely monitored and estimated 
loan losses resulting from potential Y2K exposure will be incorporated in the 
evaluation of the adequacy of the loan loss reserve.  Furthermore, credit 
analyses on new and existing credits include evaluation of Year 2000 
readiness.  

      Although One Valley has implemented and made significant progress toward 
completing its Y2K project, there are uncertainties which, due to their 
unprecedented nature, simply cannot be fully evaluated.  For example, the 
extent of interplay between payment systems is unclear, and it is not known 
how the potential failure of one aspect of that complex system might adversely 
impact other elements.  In addition, although testing will be completed for 
each significant system, it is not possible to independently verify each 
vendor's vendor.  It is unknown how a problem at one discrete point in the 
chain of service could impact an entire system.

      Management believes it has an effective project in place to resolve the 
Y2K issue in a timely manner.  In the event of a vendor or other Y2K failure, 
the Company may be unable to perform some or all of the functions related to 
its customers' financial transactions.  The impact and duration of such 
inability would depend upon the extent of the Y2K-related failure or failures.  
While One Valley believes that it is taking the steps appropriate to prevent a 
Y2K failure, in a matter such as this, certainty is not possible.  In 
addition, the potential for disruptions in the economy generally resulting 
from Y2K issues remains unknown and could also materially adversely affect One 
Valley.  If system failures occur for any reason, One Valley could also be 
subject to litigation.  The likelihood of such events and their impact on One 
Valley cannot be reasonably estimated at this time.

      One Valley is in the process of developing its overall strategy for Y2K 
contingency plans in the event that it does not complete all phases of the Y2K 
project, or that Y2K issues at a vendor or customer affect One Valley.  As 
part of that process it will assess the potential business impact of the 
failure of each of its important systems to determine the need for contingency 
planning on a system by system basis.  To date, some contingency plans have 
been developed for mission critical applications and One Valley will continue 
to develop similar plans as it finalizes evaluation of remaining systems.


Project Costs

      Expenses directly related to Y2K have been incurred such as staff costs 
and informational conferences and seminars for employees and customers, 
however, these have been immaterial to date.  Since One Valley utilizes third 
party providers for most of its IT systems, One Valley has no direct expense 
as a result of upgrades to those systems as a result of Y2K concerns, although 
these vendors may attempt to recover some of their costs by way of future 
price increases upon renewal of their respective contracts.

      One Valley has been very aggressive in upgrading its internal IT Systems 
infrastructure, most of which are capital improvements attributed to planned 
upgrades in technology to modernize the way One Valley performs its day-to-day 
operations, and not solely the result of Y2K concerns.  One Valley plans to 
replace systems which are not certified as Y2K ready, including its item 
processing system, with equipment that is verified as Y2K ready.

      The total cost of the Y2K project, consisting primarily of computer 
upgrades for One Valley's IT Systems which were the result of or accelerated 
by Y2K concerns, is estimated to be approximately $5.0 million.  To date, One 
Valley has incurred approximately $3.5 million of these total estimated 
expenditures. One Valley does not separately track the internal costs incurred 
for the Y2K project, which are principally payroll costs for its information 
technology employees.  Virtually all of the project costs are attributable to 
the purchase of new software and operations equipment, which will be 
capitalized.  

<PAGE>
<TABLE>
ONE VALLEY BANCORP, INC. AND SUBSIDIARIES
Analysis of Loan Losses and Non-Performing Assets
(unaudited in thousands)
<CAPTION>
                                                              For The Three Months      For The Nine Months
                                                               Ended September 30       Ended September 30
                                                               1998         1997         1998         1997
<S>                                                           <C>          <C>       <C>          <C>
ALLOWANCE FOR LOAN LOSSES
   Balance, Beginning of Period                               $48,907      $44,437      $45,048      $45,055
   Loan Losses                                                  2,066        2,301        6,048        7,118
   Loan Recoveries                                                535          905        1,516        1,812
                                                              -------      -------      -------      -------
      Net Charge-offs                                           1,531        1,396        4,532        5,306
   Balance of Acquired Subsidiaries                             1,857            0        3,829            0
   Provision For Loan Losses                                    2,593        1,999        7,481        5,291
                                                              -------      -------      -------      -------
   Balance, End of Period                                     $51,826      $45,040      $51,826      $45,040
                                                              =======      =======      =======      =======

Total Loans, End of Period                                                           $3,902,448   $3,227,413
Allowance For Loan Losses As a % of Total Loans                                            1.33         1.40
                                                                                     ==========   ==========

NON-PERFORMING ASSETS AT QUARTER END
   Non-Accrual Loans                                                                     $7,189      $10,740
   Foreclosed Properties                                                                  1,852        1,632
   Restructured Loans                                                                         0            0
                                                                                        -------       ------
   Total Non-Performing Assets                                                           $9,041      $12,372
                                                                                        =======      =======

Non-Performing Assets As a % of Total Loans                                                0.23         0.38

Loans Past Due Over 90 Days                                                              $8,590       $6,409
Loans Past Due Over 90 Days As a % of Total Loans                                          0.22         0.20

</TABLE>
<PAGE>
<TABLE>
ONE VALLEY BANCORP, INC. AND SUBSIDIARIES
Consolidated Average Balance Sheets
(unaudited in thousands)
<CAPTION>
                                          Three Months Ended September 30                   Nine Months Ended September 30
                                         1998                       1997                   1998                      1997
                                   Amount   Yield/Rate       Amount     Yield/Rate     Amount   Yield/Rate      Amount  Yield/Rate
                                              (pct.)                    (pct.)                    (pct.)                   (pct.)
<S>                             <C>            <C>         <C>          <C>          <C>           <C>         <C>         <C>
ASSETS
Loans
   Taxable                      $3,775,930     8.64        $3,156,635    8.82        $3,561,122    8.72        $3,114,629   8.82
   Tax-Exempt                       42,520     9.69            44,414   10.51            42,744    9.77            44,477  10.42
                                ----------                 ----------                ----------                ----------
      Total                      3,818,450     8.66         3,201,049    8.84         3,603,866    8.74         3,159,106   8.86
   Less: Allowance for Losses       50,954                     44,869                    48,662                    45,209
                                ----------                 ----------                ----------                ----------
      Net Loans                  3,767,496     8.77         3,156,180    8.97         3,555,204    8.85         3,113,897   8.98
Securities
   Taxable                       1,374,818     6.37         1,270,328    6.66         1,397,864    6.45         1,234,370   6.72
   Tax-Exempt                      241,737     7.94           226,241    8.13           236,569    8.01           225,566   8.17
                                ----------                 ----------                ----------                ----------
      Total                      1,616,555     6.61         1,496,569    6.88         1,634,433    6.68         1,459,936   6.94
Federal Funds Sold & Other          36,465     5.41            35,324    5.08            27,720    5.64            34,416   5.05
                                ----------                 ----------                ----------                ----------
   Total Earning Assets          5,420,516     8.10         4,688,073    8.28         5,217,357    8.16         4,608,249   8.31
Other Assets                       375,658                    322,832                   361,032                   317,996
                                ----------                 ----------                ----------                ----------
   Total Assets                 $5,796,174                 $5,010,905                $5,578,389                $4,926,245
                                ==========                 ==========                ==========                ==========


LIABILITIES AND EQUITY
Interest Bearing Liabilities
   Deposits                     $3,834,624     4.28        $3,454,301    4.33        $3,720,519    4.29        $3,426,045   4.30
   Short-term Borrowings           752,854     5.10           544,098    4.93           722,552    5.14           502,761   4.85
   Long-term Borrowings             41,685     6.02            57,876    6.03            45,148    6.03            55,751   6.10
                                ----------                 ----------                ----------                ----------
      Total Interest
         Bearing Liabilities     4,629,163     4.43         4,056,275    4.44         4,488,219    4.44         3,984,557   4.39
Non-interest Bearing Deposits      539,190                    415,944                   494,817                   406,984
Other Liabilities                   52,283                     46,708                    48,665                    47,886
                                ----------                 ----------                ----------                ----------
   Total Liabilities             5,220,636                  4,518,927                 5,031,701                 4,439,427
Shareholders' Equity               575,538                    491,978                   546,688                   486,818
                                ----------                 ----------                ----------                ----------
   Total Liabilities & Equity   $5,796,174                 $5,010,905                $5,578,389                $4,926,245
                                ==========                 ==========                ==========                ==========

Interest Income To Earning Assets              8.10                      8.28                      8.16                     8.31
Interest Expense To Earning Assets             3.78                      3.84                      3.82                     3.80
                                             ------                    ------                    ------                   ------
Net Interest Margin                            4.32                      4.44                      4.34                     4.51
                                             ======                    ======                    ======                   ======

<FN>  Note:  Yields are computed on a fully taxable equivalent basis using the rate of 35%.

</TABLE>


<PAGE>


 One Valley Bancorp, Inc.

Part II.  Other Information


Item 6.   Exhibits and Reports on Form 10-Q

     a)   Exhibits
                                    
          27.  Financial Data Schedule - electronic filing only.

     b)   Reports on Form 8-K

          1. July 30, 1998 - One Valley Bancorp, Inc. announced the new 
             closing date for the Summit Bankshares, Inc. merger.
          2. August 7,1998 - One Valley Bancorp, Inc. announced the 
             completion of the Summit Bankshares, Inc. merger.
          3. September 15, 1998 - One Valley Bancorp, Inc. announced third
             quarter dividends.


                                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.


                                One Valley Bancorp, Inc.

DATE: November 13, 1998


                                BY  /s/ J. Holmes Morrison
                                        J. Holmes Morrison
                                         President and
                                           Chief Executive Officer 


                                BY  /s/ Laurance G. Jones
                                        Laurance G. Jones
                                         Executive Vice President 
                                           and Chief Financial Officer