SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q
(Mark One)

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


For the quarterly period ended                  March 31, 1999
                              --------------------------------------------------

                                       OR

[ ]  TRANSITION  REPORT  PURSUANT  TO  SECTION  13 OR  15(d)  OF THE  SECURITIES
     EXCHANGE ACT OF 1934

For the transition period from                       to
                               ---------------------    ------------------------

Commission file number                            0-21382
                       ---------------------------------------------------------


                      Capital Preferred Yield Fund-II, L.P.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

              Delaware                                  84-1184628
       -----------------------              ------------------------------------
       (State of organization)              (I.R.S. Employer Identification No.)

 7175 West Jefferson Avenue, Suite 4000
           Lakewood, Colorado                             80235
----------------------------------------               ----------
(Address of principal executive offices)               (Zip Code)

        Registrant's telephone number, including area code (303) 980-1000
                                                           --------------

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

                        Exhibit Index appears on Page 14

                               Page 1 of 15 Pages


<PAGE>



                      CAPITAL PREFERRED YIELD FUND-II, L.P.

                          Quarterly Report on Form 10-Q
                              for the Quarter Ended
                                 March 31, 1999


                                Table of Contents
                                -----------------

PART I.   FINANCIAL INFORMATION                                            PAGE
                                                                           ----

   Item 1.   Financial Statements (Unaudited)

             Balance Sheets - March 31, 1999 and December 31, 1998          3

             Statements of Income - Three Months Ended
             March 31, 1999 and 1998                                        4

             Statements of Cash Flows - Three Months Ended
             March 31, 1999 and 1998                                        5

             Notes to Financial Statements                                 6-7

   Item 2.   Management's Discussion and Analysis of Financial
             Condition and Results of Operations                           8-12

   Item 3.  Quantitative and Qualitative Disclosures About Market Risk      12


PART II.  OTHER INFORMATION

   Item 1.   Legal Proceedings                                              13

   Item 6.   Exhibits and Reports on Form 8-K                               13

             Exhibit Index                                                  14

             Signature                                                      15


                                        2

<PAGE>



                      CAPITAL PREFERRED YIELD FUND-II, L.P.

                                 BALANCE SHEETS



                                     ASSETS
                                                      March 31,     December 31,
                                                        1999             1998
                                                     -----------    ------------
                                                     (Unaudited)

Cash and cash equivalents                            $ 1,101,749     $   784,867
Accounts receivable, net                                 722,372         771,076
Receivable from affiliates                               141,213               -
Equipment held for sale or re-lease                      313,000         285,299
Net investment in direct finance leases                2,606,564       2,865,887
Leased equipment, net                                  8,050,524       9,637,771
                                                     -----------     -----------

Total assets                                         $12,935,422     $14,344,900
                                                     ===========     ===========

                        LIABILITIES AND PARTNERS' CAPITAL

Liabilities:
     Accounts payable and accrued liabilities        $ 1,168,702     $ 1,334,422
     Payables to affiliates                               48,919           2,142
     Rents received in advance                           132,376         105,332
     Distributions payable to partners                   683,675         508,106
     Discounted lease rentals                          3,882,919       4,612,151
                                                     -----------     -----------

Total liabilities                                      5,916,591       6,562,153
                                                     -----------     -----------

Partners' capital:
     General partner                                           -               -
     Limited partners:
         Class A                                       6,833,838       7,601,001
         Class B                                         184,993         181,746
                                                     -----------     -----------

Total partners' capital                                7,018,831       7,782,747
                                                     -----------     -----------

Total liabilities and partners' capital              $12,935,422     $14,344,900
                                                     ===========     ===========



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

                                        3

<PAGE>



                      CAPITAL PREFERRED YIELD FUND-II, L.P.

                              STATEMENTS OF INCOME
                                   (Unaudited)

                                                          Three Months Ended
                                                               March 31,
                                                      --------------------------
                                                         1999           1998
                                                      ----------      ----------

REVENUE:
     Operating lease rentals                          $1,138,466      $1,810,806
     Direct finance lease income                          68,394          96,266
     Equipment sales margin                              276,324         179,867
     Interest income                                       5,552          29,548
                                                      ----------      ----------

Total revenue                                          1,488,736       2,116,487
                                                      ----------      ----------

EXPENSES:
     Depreciation                                        906,688       1,431,584
     Management fees to general partner                   36,053          39,360
     Direct services from general partner                 30,714          31,421
     General and administrative                           54,155          52,001
     Interest on discounted lease rentals                 79,178         138,907
     Interest on financed operating lease rentals              -          35,606
     Provision for losses                                 50,000          25,000
                                                      ----------      ----------

Total expenses                                         1,156,788       1,753,879
                                                      ----------      ----------

NET INCOME                                            $  331,948      $  362,608
                                                      ==========      ==========

NET INCOME ALLOCATED:
     To the general partner                           $   10,878      $   19,789
     To the Class A limited partners                     317,823         339,345
     To the Class B limited partner                        3,247           3,474
                                                      ----------      ----------

                                                      $  331,948      $  362,608
                                                      ==========      ==========

  Net income per weighted average
      Class A limited partner unit outstanding        $     2.38      $     2.54
                                                      ==========      ==========

  Weighted average Class A
       limited partner units outstanding                 133,447         133,694
                                                      ==========      ==========



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

                                        4

<PAGE>



                      CAPITAL PREFERRED YIELD FUND-II, L.P.

                            STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                                        Three Months Ended
                                                                            March 31,
                                                                    --------------------------
                                                                       1999          1998
                                                                    -----------    -----------

<S>                                                                <C>            <C>        
NET CASH PROVIDED BY OPERATING ACTIVITIES                           $ 1,969,774    $ 3,085,527
                                                                    -----------    -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchases of equipment on operating leases from affiliate              (3,364)             -
  Investment in direct financing leases, acquired from affiliate              -              -
                                                                    -----------    -----------

Net cash used in investing activities                                    (3,364)             -
                                                                    -----------    -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Principal payments on discounted lease rentals                       (729,232)      (845,767)
  Principal payments on financed operating lease rentals                      -       (141,374)
  Distributions to partners                                            (912,146)    (1,726,338)
  Redemptions of Class A limited partner units                           (8,150)        (5,104)
                                                                    -----------    -----------

Net cash used in financing activities                                (1,649,528)    (2,718,583)
                                                                    -----------    -----------

NET INCREASE IN CASH AND CASH EQUIVALENTS                               316,882        366,944

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                        784,867      1,897,763
                                                                    -----------    -----------

CASH AND CASH EQUIVALENTS AT END OF PERIOD                          $ 1,101,749    $ 2,264,707
                                                                    ===========    ===========

Supplemental disclosure of cash flow information:
  Interest paid on discounted lease rentals                         $    79,178    $   138,907
  Interest paid on financed operating lease rentals                           -         35,606

</TABLE>









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

                                        5

<PAGE>



                      CAPITAL PREFERRED YIELD FUND-II, L.P.

                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)


1.   Basis of Presentation
     ---------------------

     The  accompanying  unaudited  financial  statements  have been  prepared in
     accordance  with  generally  accepted  accounting  principles  for  interim
     financial  information and the  instructions to Form 10-Q and Rule 10-01 of
     Regulation S-X. Accordingly, they do not include all of the information and
     disclosures required by generally accepted accounting principles for annual
     financial   statements.   In  the  opinion  of  the  General  Partner,  all
     adjustments   (consisting  of  normal  recurring  adjustments)   considered
     necessary for a fair presentation have been included.  The balance sheet at
     December  31,  1998 was  derived  from  the  audited  financial  statements
     included in the Partnership's Annual Report on Form 10-K for the year ended
     December  31,  1998,  (the  "1998  Form  10-K")  previously  filed with the
     Securities and Exchange Commission.

     RECENTLY ISSUED FINANCIAL ACCOUNTING STANDARDS

     In June 1998, the Financial Accounting Standards Board issued SFAS No. 133,
     Accounting for Derivative  Instruments and Hedging  Activities  ("Statement
     133").  Statement 133  establishes  accounting and reporting  standards for
     derivative  instruments  and for hedging  activities.  It requires  that an
     entity  recognize all  derivatives  as either assets or  liabilities in the
     statement  of  financial  position and measure  those  instruments  at fair
     value. Statement 133 is effective for fiscal years beginning after June 15,
     1999, with earlier application permitted. The Partnership adopted Statement
     133 in the first quarter of 1999.  The General  Partner does not expect the
     adoption to have an impact on its financial reporting.

     MANAGEMENT FEES TO GENERAL PARTNER

     In accordance with the Partnership  Agreement,  the General Partner earns a
     management  fee  in  connection  with  its  management  of  the  equipment,
     calculated as a percentage of the monthly gross rentals received,  and paid
     monthly in  arrears.  At March 31,  1999,  management  fees of $11,929  are
     included in payables to affiliates.

     DIRECT SERVICES FROM GENERAL PARTNER

     The  General  Partner  and  an  affiliate  provide   accounting,   investor
     relations,  billing, collecting, asset management, and other administrative
     services to the Partnership. The Partnership reimburses the General Partner
     for these services  performed on its behalf as permitted under the terms of
     the  Partnership  Agreement.  At March 31, 1999,  direct  services from the
     General  Partner  in the  amount of $6,044  are  included  in  payables  to
     affiliates.




                                        6

<PAGE>


                      CAPITAL PREFERRED YIELD FUND-II, L.P.

                          NOTES TO FINANCIAL STATEMENTS
                             (Unaudited), continued

2.   Transactions With the General Partner and Affiliates
     ----------------------------------------------------

     GENERAL AND ADMINISTRATIVE EXPENSES

     The General  Partner and an affiliate are reimbursed for the actual cost of
     administrative  expenses incurred on behalf of Partnership per the terms of
     the Partnership Agreement.  At March 31, 1999,  administrative  expenses in
     the amount of $30,946 are included in payables to affiliates.

3.   Year 2000
     ---------

     An  affiliate  provides  accounting  and  other  administrative   services,
     including data processing  services to the  Partnership.  The affiliate has
     conducted  a  comprehensive  review of its  computer  systems  to  identify
     systems that could be affected by the Year 2000 issue.  The Year 2000 issue
     results from computer  programs  being written using two digits rather than
     four to define the applicable year.  Certain  computer  programs which have
     date-sensitive  software could recognize a date using "00" as the year 1900
     rather than the year 2000.  This could result in major  system  failures or
     miscalculations.  Certain of the  affiliate's  software  has  already  been
     upgraded to  correctly  account for the Year 2000 issue.  The  affiliate is
     implementing  additional  upgrades  whereby the  affiliate's  primary lease
     tracking and accounting  software will account for the Year 2000 correctly.
     The affiliate  expects that the new upgrades will be fully  operational  by
     December 31, 1999,  and  therefore  expects that it will be fully Year 2000
     compliant. The affiliate does not expect any other changes required for the
     Year 2000 to have a material effect on its financial position or results of
     operations.   As  such,  the  affiliate  has  not  developed  any  specific
     contingency  plans  in the  event  it fails to  complete  the  upgrades  by
     December  31,  1999.  However,  should the  affiliate  be  unsuccessful  in
     completing the necessary  upgrades by December 31, 1999, it does not expect
     there  will be a material  adverse  effect on the  Partnership's  financial
     position or results of operations.  There could be a negative impact on the
     Partnership's  ability to realize expected cash flows from leased equipment
     on a timely basis.  While it is expected that the Partnership's  ability to
     ultimately realize all expected cash flows will not be impacted,  delays in
     collecting  cash  flows  would  have a  negative  impact  on the  timing of
     distributions  to  partners.  The  affiliate  does not expect any Year 2000
     issues  relating to its customers and vendors to have a material  effect on
     its financial position or results of operations.


                                        7

<PAGE>



                      CAPITAL PREFERRED YIELD FUND-II, L.P.

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

Results of Operations
---------------------

Presented below are schedules  (prepared  solely to facilitate the discussion of
results of  operations  that  follows)  showing  items of income and expense and
changes in those items derived from the Statements of Income:

                                               Three Months
                                              Ended March 31,
                                           -----------------------
                                             1999          1998        Change
                                           ---------     ---------    ---------

Leasing margin                             $ 220,994     $ 300,975    $ (79,981)
Equipment sales margin                       276,324       179,867       96,457
Interest income                                5,552        29,548      (23,996)
Management fees to general partner           (36,053)      (39,360)       3,307
Direct services from general partner         (30,714)      (31,421)         707
General and administrative expenses          (54,155)      (52,001)      (2,154)
Provision for losses                         (50,000)      (25,000)     (25,000)
                                           ---------     ---------    ---------
  Net income                               $ 331,948     $ 362,608    $ (30,660)
                                           =========     =========    =========

The  Partnership  is in its  liquidation  stage,  as defined in the  Partnership
Agreement.  The  Partnership is not  purchasing  additional  equipment,  initial
leases  are  expiring,  and the  amount of  equipment  being  remarketed  (i.e.,
re-leased,  renewed,  or sold) is increasing.  As a result, both the size of the
Partnership's lease portfolio and the amount of leasing revenue are declining.

LEASING MARGIN

Leasing margin consists of the following:

                                                         Three Months Ended
                                                             March 31,
                                                    ---------------------------
                                                       1999            1998
                                                    -----------     -----------

Operating lease rentals                             $ 1,138,466     $ 1,810,806
Direct finance lease income                              68,394          96,266
Depreciation                                           (906,688)     (1,431,584)
Interest expense on discounted lease rentals            (79,178)       (138,907)
Interest expense on financed operating
  lease rentals                                               -         (35,606)
                                                    -----------     -----------
     Leasing margin                                 $   220,994     $   300,975
                                                    ===========     ===========

     Leasing margin ratio                                    18%             16%
                                                    ===========     ===========

                                        8

<PAGE>


                      CAPITAL PREFERRED YIELD FUND-II, L.P.

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

Results of Operations, continued
---------------------

LEASING MARGIN, continued

All components of leasing margin  decreased for the three months ended March 31,
1999 compared to the three months ended March 31, 1998 due to portfolio runoff.

Leasing  margin ratio varies due to changes in the portfolio,  including,  among
other things,  the mix of operating  leases versus direct  finance  leases,  the
average maturity of leases comprising the portfolio,  the average residual value
of leases in the portfolio, and the amount of discounted lease rentals financing
the  portfolio.  Leasing  margin and the  related  leasing  margin  ratio for an
operating lease financed with non-recourse debt increases during the term of the
lease since rents and  depreciation  are typically fixed while interest  expense
declines as the related non-recourse debt principal is repaid.

The ultimate rate of return on leases depends, in part, on interest rates at the
time the leases are originated,  future  equipment  values,  and on-going lessee
creditworthiness.  Because  leasing is an  alternative  to  financing  equipment
purchases  with  debt,  lease  rates tend to rise and fall with  interest  rates
(although  lease rate  movements  generally  lag  interest  rate  changes in the
capital markets).

EQUIPMENT SALES MARGIN

Equipment sales margin consists of the following:

                                                          Three Months Ended
                                                               March 31,
                                                       ------------------------
                                                          1999           1998
                                                       ---------      ---------

Equipment sales revenue                                $ 893,850      $ 931,395
Cost of equipment sales                                 (617,526)      (751,528)
                                                       ---------      ---------
   Equipment sales margin                              $ 276,324      $ 179,867
                                                       =========      =========

Equipment  sales  margin  fluctuates  based  on  the  composition  of  equipment
available for sale.  Currently,  the Partnership is in its liquidation phase (as
defined in the Partnership Agreement). Initial leases are expiring and equipment
is being remarketed (i.e.,  re-leased or sold to the original lessee or to third
parties).  Equipment  sold during the three months ended March 31, 1999 included
locomotives with a gain of $154,500,  machine tools with a gain of $35,484,  and
manufacturing equipment with a gain of $74,470.  Equipment sold during the three
months  ended March 31, 1998  included  tractors  with a gain of $59,159,  glass
packaging equipment with a gain of $49,138,  and manufacturing  equipment with a
gain of $60,830.

INTEREST INCOME

Interest  income varies based on the amount of cash  available  for  investment,
pending distribution to partners, and the interest rate on such invested cash.

                                        9

<PAGE>


                      CAPITAL PREFERRED YIELD FUND-II, L.P.

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

Results of Operations, continued
---------------------

EXPENSES

Management fees paid to the General Partner decreased for the three months ended
March 31, 1999 as compared to the corresponding  period in 1998 primarily due to
portfolio  run-off.  Management  fees are  calculated  as a percentage  of rents
collected.

General and administrative expenses and direct services from the General Partner
were  comparable to 1998. The primary  components of general and  administrative
expenses  for the three months ended March 31, 1999 and March 31, 1998 were data
processing,  advertising,  audit and tax  fees,  bank  charges,  legal and state
income taxes.

PROVISION FOR LOSSES

The  remarketing  of  equipment  for an amount  greater  than its book  value is
reported  with  equipment  sales  margin (if the  equipment  is sold) or leasing
margin  (if the  equipment  is  re-leased).  The  realization  of less  than the
carrying  value of equipment  (which  occurs when the  equipment  is  remarketed
subsequent to initial lease termination) is recorded as provision for losses.

Residual values are established equal to the estimated value to be received from
the equipment following termination of the lease. In estimating such values, the
Partnership considers all relevant facts regarding the equipment and the lessee,
including,  for  example,  the  likelihood  that the lessee  will  re-lease  the
equipment.  The nature of the Partnership's  leasing  activities is such that it
has  credit  and  residual  value  exposure  and will  incur  losses  from those
exposures in the ordinary course of business. The Partnership performs quarterly
assessments  of  the  estimated  residual  values  of  its  assets  to  identify
other-than-temporary losses in value.

The provision for losses  recorded  during the three months ended March 31, 1999
related primarily to lessees returning equipment to the Partnership.

Liquidity and Capital Resources
-------------------------------

The  Partnership  is in its  liquidation  stage,  as defined in the  Partnership
Agreement.  The  Partnership is not  purchasing  additional  equipment,  initial
leases  are  expiring,  and the  amount of  equipment  being  remarketed  (i.e.,
re-leased,  renewed,  or sold) is increasing.  As a result, both the size of the
Partnership's lease portfolio and the amount of leasing revenue are declining.

The Partnership funds its operating activities principally with cash from rents,
interest  income,  and sales of  off-lease  equipment.  Available  cash and cash
reserves of the  Partnership  are invested in short-term  government  securities
pending distributions to the partners.

                                       10

<PAGE>


                      CAPITAL PREFERRED YIELD FUND-II, L.P.

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

Liquidity and Capital Resources, continued
-------------------------------

During  the  three  months  ended  March  31,  1999,  the  Partnership  declared
distributions  to the  partners of  $1,087,715,  ($683,675  of which was paid in
April 1999). A substantial portion of such distributions constituted a return of
capital.  Distributions  may be characterized  for tax,  accounting and economic
purposes as a return of capital,  a return on capital,  or both.  The portion of
each  partners'  cash  distribution  which exceeds its net income for the fiscal
period may be deemed a return of capital for accounting  purposes.  However, the
total percentage of the  partnership's  return on capital over its life can only
be  determined  after all residual cash flows (which  include  proceeds from the
re-leasing  and sale of equipment  after  initial  lease terms expire) have been
realized at the termination of the partnership.

The General Partner believes that the Partnership will generate  sufficient cash
flow from operations  during the remainder of 1999 to (1) meet current operating
requirements and (2) fund cash  distributions to the Class A limited partners in
accordance with the Partnership Agreement.  Distributions during the liquidation
phase will vary based upon cash availability.  All distributions are expected to
be a return of capital for economic purposes.

The  Class  B  limited  partner   distributions  of  cash  from  operations  are
subordinated to the Class A limited  partners  receiving  distributions  of cash
from  operations,  as  scheduled  in  the  Partnership  Agreement  (i.e.,  12%).
Therefore,  because  of the  decrease  in  distributions  to the Class A limited
partners  during the three months ended March 31, 1999,  CAII,  the sole Class B
limited partner, did not receive any distributions of cash from operations.

YEAR 2000 ISSUES

An affiliate provides accounting and other  administrative  services,  including
data  processing  services to the  Partnership.  The  affiliate  has conducted a
comprehensive  review of its computer  systems to identify systems that could be
affected  by the Year 2000  issue.  The Year 2000 issue  results  from  computer
programs  being  written  using  two  digits  rather  than  four to  define  the
applicable year.  Certain computer programs which have  date-sensitive  software
could  recognize  a date using "00" as the year 1900  rather than the year 2000.
This could result in major system  failures or  miscalculations.  Certain of the
affiliate's software has already been upgraded to correctly account for the Year
2000 issue.  The  affiliate  is  implementing  additional  upgrades  whereby the
affiliate's  primary lease tracking and accounting software will account for the
Year 2000 correctly.  The affiliate  expects that the new upgrades will be fully
operational  by December 31, 1999,  and therefore  expects that it will be fully
Year 2000  compliant.  The affiliate does not expect any other changes  required
for the Year 2000 to have a material effect on its financial position or results
of operations. As such, the affiliate has not developed any specific contingency
plans in the event it fails to  complete  the  upgrades by  December  31,  1999.
However,  should the  affiliate be  unsuccessful  in  completing  the  necessary
upgrades  by  December  31,  1999,  it does not expect  there will be a material
adverse effect on the Partnership's financial position or results of operations.
There  could be a  negative  impact  on the  Partnership's  ability  to  realize

                                       11

<PAGE>


                      CAPITAL PREFERRED YIELD FUND-II, L.P.

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

Liquidity and Capital Resources, continued
-------------------------------

YEAR 2000 ISSUES, continued

expected  cash  flows  from  leased  equipment  on a timely  basis.  While it is
expected that the Partnership's  ability to ultimately realize all expected cash
flows  will not be  impacted,  delays in  collecting  cash  flows  would  have a
negative impact on the timing of distributions  to partners.  The affiliate does
not expect any Year 2000 issues  relating to its customers and vendors to have a
material effect on its financial position or results of operations.

New Accounting Pronouncements
-----------------------------

In June 1998,  the  Financial  Accounting  Standards  Board issued SFAS No. 133,
Accounting for Derivative  Instruments and Hedging Activities ("Statement 133").
Statement 133  establishes  accounting  and reporting  standards for  derivative
instruments and for hedging activities. It requires that an entity recognize all
derivatives  as either  assets or  liabilities  in the  statement  of  financial
position and measure those instruments at fair value. Statement 133 is effective
for  fiscal  years  beginning  after June 15,  1999,  with  earlier  application
permitted.

The Partnership  adopted Statement 133 in the first quarter of 1999. The General
Partner  does  not  expect  the  adoption  to have an  impact  on its  financial
reporting.

"Safe Harbor"  Statement Under the Private  Securities  Litigation Reform Act of
--------------------------------------------------------------------------------
1995
----

The statements  contained in this report which are not  historical  facts may be
deemed to contain  forward-  looking  statements  with  respect  to events,  the
occurrence of which involve risks and uncertainties,  and are subject to factors
that could cause actual future  results to differ both  adversely and materially
from currently anticipated results, including,  without limitation, the level of
lease originations, realization of residual values, the availability and cost of
financing  sources and the ultimate  outcome of any contract  disputes.  Certain
specific risks associated with particular aspects of the Partnership's  business
are  discussed  under  Results of Operations in this report and under Results of
Operations in the 1998 Form 10-K when and where applicable.


Item 3.    Quantitative and Qualitative Disclosures About Market Risk

The  partnership  is in the  liquidation  stage (as  defined in the  Partnership
Agreement).  Consequently,  the partnership is no longer originating new leases.
The partnership's  existing leases are non-cancelable,  have fixed rates and are
financed with fixed rate debt.  Therefore,  the  partnership  has no exposure to
fluctuations in interest rates or other market risk exposure.


                                       12

<PAGE>



                      CAPITAL PREFERRED YIELD FUND-II, L.P.

                                    PART II.

                                OTHER INFORMATION



Item 1.    Legal Proceedings

           The Partnership is involved in routine legal  proceedings  incidental
           to the conduct of its business.  The General Partner believes none of
           these legal  proceedings  will have a material  adverse effect on the
           financial condition or operations of the Partnership.

Item 6.    Exhibits and Reports on Form 8-K

           (a)  Exhibits

           (b)  The  Partnership did not file any reports on Form 8-K during the
                quarter ended March 31, 1999.


                                       13

<PAGE>



Item No.                           Exhibit Index


   27           Financial Data Schedule








                                       14

<PAGE>



                      CAPITAL PREFERRED YIELD FUND-II, L.P.

                                    Signature



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


                                         CAPITAL PREFERRED YIELD FUND-II, L.P.

                                         By:  CAI Equipment Leasing III Corp.


Dated:    May 17, 1999                   By:  /s/Anthony M. DiPaolo
                                              ------------------------------
                                              Anthony M. DiPaolo
                                              Senior Vice President







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