UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C., 20549

                                    FORM 10-Q/A-1

(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                                              1-11011

                              THE FINOVA GROUP INC.
             (Exact name of registrant as specified in its charter)


DELAWARE                                                              86-0695381
(State or other jurisdiction of                                 (I.R.S. Employer
incorporation or organization)                               Identification No.)


1850 North Central Ave., P. O. Box 2209, Phoenix, AZ                  85002-2209
(Address of principal executive offices)                              (Zip Code)

Registrant's telephone number, including area code                  602/207-6900

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 such shorter period that the Registrant was
required  to file  such  report),  and  (2)  has  been  subject  to such  filing
requirements for the past 90 days.

                                 YES [X}  NO [ ]

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

As of May 13,  1999,  61,020,000  shares of Common  Stock ($0.01 par value) were
outstanding.

As of  September  3, 1999,  61,159,000  shares of Common Stock ($0.01 par value)
were outstanding.
<PAGE>
                              THE FINOVA GROUP INC.

                                TABLE OF CONTENTS


                                                                        Page No.
                                                                        --------

Part I - Financial Information

   Item 1. Financial Statements

     Consolidated Condensed Balance Sheets
       as of March 31, 1999 and December 31, 1998 (restated)                1

     Consolidated Condensed Statements of Income
       for the three months ended March 31, 1999 and 1998 (restated)        2

     Consolidated Condensed Statements of Cash Flows
       for the three months ended March 31, 1999 and 1998 (restated)        3

     Notes to Interim Consolidated Condensed Financial Statements           4


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

   Item 3. Quantitative and Qualitative Disclosures about Market Risk      15

Part II - Other Information                                                17

   Item 6. Exhibits and Reports on Form 8-K                                17

Signatures                                                                 18
<PAGE>
                         PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                              THE FINOVA GROUP INC.
                      CONSOLIDATED CONDENSED BALANCE SHEETS
                             (Dollars in Thousands)
                                   (Unaudited)

                                                                    December 31,
                                                      March 31,         1998
                                                        1999          restated
                                                    ------------    ------------
ASSETS:
Cash and cash equivalents                           $    91,032     $    49,518
Investment in financing transactions:
 Loans and other financing contracts                  8,270,159       7,354,736
 Leveraged leases                                       802,937         773,942
 Operating leases                                       665,912         648,185
 Fee-based receivables                                  618,779         626,499
 Direct financing leases                                382,746         396,759
 Financing contracts held for sale                      345,483         220,100
                                                    -----------     -----------
                                                     11,086,016      10,020,221
 Less reserve for credit losses                        (238,277)       (207,618)
                                                    -----------     -----------
Net investment in financing transactions             10,847,739       9,812,603
Investments                                             211,004         124,792
Goodwill and other assets                               580,572         454,323
                                                    -----------     -----------
                                                    $11,730,347     $10,441,236
                                                    ===========     ===========
LIABILITIES:
 Accounts payable and accrued expenses              $   140,015     $   154,137
 Due to clients                                         203,869         205,655
 Interest payable                                        55,543          65,817
 Senior debt                                          9,327,137       8,394,578
 Deferred income taxes                                  334,621         342,268
                                                    -----------     -----------
                                                     10,061,185       9,162,455
                                                    -----------     -----------
Commitments and contingencies
Company-obligated mandatory redeemable convertible
 preferred securities of subsidiary trust solely
 holding convertible debentures of FINOVA, net of
 expenses ("TOPrS")                                     111,550         111,550

SHAREOWNERS' EQUITY:
 Common stock, $0.01 par value, 100,000,000 shares
   authorized, 64,638,000 and 58,555,000 shares
   issued, respectively                                     646             585
 Additional capital                                   1,120,335         765,050
 Retained income                                        556,147         515,057
 Accumulated other comprehensive (loss) income          (13,727)            686
 Common stock in treasury, 2,447,000 and 2,834,000
   shares, respectively                                (105,789)       (114,147)
                                                    -----------     -----------
                                                      1,557,612       1,167,231
                                                    -----------     -----------
                                                    $11,730,347     $10,441,236
                                                    ===========     ===========

See notes to interim consolidated condensed financial statements.

                                       1
<PAGE>
                              THE FINOVA GROUP INC.
                   CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                             (Dollars in Thousands)
                                   (Unaudited)


                                                   Three Months Ended March 31,
                                                  -----------------------------
                                                                       1998
                                                      1999           restated
                                                  ------------     ------------
Interest and income earned from
  financing transactions                          $    245,222     $    200,170
Operating lease income                                  27,853           32,663
Interest expense                                      (131,183)        (110,280)
Depreciation                                           (17,226)         (17,170)
                                                  ------------     ------------
Interest margins earned                                124,666          105,383
Volume-based fee income                                 12,735           22,156
                                                  ------------     ------------
Operating margin                                       137,401          127,539
Provision for credit losses                             (9,500)          (9,500)
                                                  ------------     ------------
Net interest margins earned                            127,901          118,039
Gains on disposal of assets                             12,370            1,525
                                                  ------------     ------------
                                                       140,271          119,564
Operating expenses                                     (57,499)         (52,878)
                                                  ------------     ------------
Income before income taxes and
 preferred dividends                                    82,772           66,686
Income taxes                                           (31,769)         (25,999)
                                                  ------------     ------------
Income before preferred dividends                       51,003           40,687
Preferred dividends, net of tax                           (946)            (946)
                                                  ------------     ------------
NET INCOME                                        $     50,057     $     39,741
                                                  ============     ============

Basic earnings per share                          $       0.89     $       0.71
                                                  ============     ============
Adjusted weighted average shares outstanding        56,294,000       56,138,000
                                                  ============     ============

Diluted earnings per share                        $       0.83     $       0.67
                                                  ============     ============
Adjusted weighted average shares outstanding        61,318,000       61,079,000
                                                  ============     ============

Dividends declared per common share               $       0.16     $       0.14
                                                  ============     ============

See notes to interim consolidated condensed financial statements.

                                       2
<PAGE>
                              THE FINOVA GROUP INC.
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                             (Dollars in Thousands)
                                   (Unaudited)

                                                   Three Months Ended March 31,
                                                  -----------------------------
                                                     1999              1998
                                                    restated         restated
                                                  ------------     ------------
OPERATING ACTIVITIES:
 Net income                                        $  50,057        $  39,741
 Adjustments to reconcile net income to net
  cash provided by operating activities:
  Provision for credit losses                          9,500            9,500
  Depreciation and amortization                       24,315           22,734
  Gains on disposal of assets                        (12,370)          (1,525)
  Deferred income taxes                               35,283           15,373
 Change in assets and liabilities, net of
  effects from acquisitions                          (74,241)         (81,738)
 Other                                               (14,565)           1,739
                                                   ---------        ---------
     Net cash provided by operating
      activities                                      17,979            5,824
                                                   ---------        ---------
INVESTING ACTIVITIES:
 Proceeds from sale of assets                         56,204           48,955
 Principal collections on financing transactions     381,104          321,553
 Expenditures for financing transactions            (776,238)        (533,579)
 Expenditures for CMBS transactions                 (159,069)
 Net change in short-term financing transactions    (329,787)        (132,795)
 Cash received in acquisition                         20,942
 Other                                                   739              824
                                                   ---------        ---------
     Net cash used in investing activities          (806,105)        (295,042)
                                                   ---------        ---------
FINANCING ACTIVITIES:
 Net borrowings under commercial paper and
  short-term loans                                   285,935          473,796
 Long-term borrowings                                855,000          100,000
 Repayment of long-term borrowings                  (309,225)        (223,430)
 Proceeds from exercise of stock options               8,683            3,144
 Dividends                                            (8,967)          (7,904)
 Net change in due to clients                         (1,786)         (39,414)
                                                   ---------        ---------
     Net cash provided by financing activities       829,640          306,192
                                                   ---------        ---------
INCREASE IN CASH AND CASH EQUIVALENTS                 41,514           16,974
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD        49,518           33,190
                                                   ---------        ---------
CASH AND CASH EQUIVALENTS, END OF PERIOD           $  91,032        $  50,164
                                                   =========        =========

See notes to interim consolidated condensed financial statements.

                                       3
<PAGE>
                              THE FINOVA GROUP INC.
          NOTES TO INTERIM CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998

NOTE A BASIS OF PRESENTATION

         The consolidated  condensed financial  statements present the financial
position,  results of operations and cash flows of The FINOVA Group Inc. and its
subsidiaries (collectively, "FINOVA" or the "Company"), including FINOVA Capital
Corporation and its subsidiaries (collectively, "FINOVA Capital").

         The interim  consolidated  financial  information is unaudited.  In the
opinion of management all  adjustments,  consisting of normal  recurring  items,
necessary to present fairly the financial position as of March 31, 1999, and the
results of  operations  and cash flows for the three months ended March 31, 1999
and 1998, have been included.  Interim results of operations are not necessarily
indicative  of the  results  of  operations  for the  full  year.  The  enclosed
financial  statements  should  be  read in  conjunction  with  the  consolidated
financial  statements and notes thereto  included in the Company's Annual Report
on Form 10-K/A, Amendment No. 2 for the year ended December 31, 1998.

         Subsequent  to the  issuance of the  Company's  condensed  consolidated
financial  statements as of and for the three month period ended March 31, 1999,
the Company's  management  determined  that certain noncash amounts had not been
properly  reflected in the Condensed  Statement of Consolidated Cash Flows. As a
result,  the Condensed  Statement of Consolidated Cash Flows for the three month
period  ended March 31,  1999,  has been  restated  from the amounts  previously
reported.

NOTE B SIGNIFICANT ACCOUNTING POLICIES

INVESTMENTS

         In the normal course of business, the Company acquires various forms of
equity  positions in other  companies  including  marketable and  non-marketable
common  stocks,   warrants  to  purchase  common  stock,  preferred  stock,  and
partnership and joint venture interests. As discussed in Note E, FINOVA acquired
Sirrom  Capital  Corporation  ("Sirrom") in March 1999. In connection  with this
acquisition,  the Company's  investments  in these types of assets  increased by
approximately $150 million.  The Company's  accounting policies related to these
investments are as follows:

         Marketable  investments are designated as available for sale securities
and  carried  at fair  value  using  the  specific  identification  method  with
unrealized gains or losses included in accumulated  other  comprehensive  income
included in stockholders' equity, net of related taxes.

         The  Company  accounts  for  investments  in joint  ventures  and other
investments  in which  the  Company  has the  ability  to  exercise  significant
influence  on the investee  under the equity  method of  accounting.  Under this
method,  the Company recognizes its share of the earnings or losses of the joint
venture in the period in which they are earned by the joint venture.

         Other investments in warrants,  certain common and preferred stocks and
certain equity investments, which are not subject to the provisions of Statement
of Financial  Accounting  Standards No. 115, "Accounting for Certain Investments
in Debt and Equity  Securities,"  are carried at cost.  The  valuation  of these
investments is periodically  reviewed and the investment balance is written down
to reflect  declines in value  determined  to be other than  temporary.  Certain
other equity  investments in limited  partnership  funds are accounted for under
the equity method of accounting in accordance with Accounting  Principles  Board
Opinion No. 18, "The  Equity  Method of  Accounting  for  Investments  in Common
Stock."

OTHER COMPREHENSIVE INCOME

         The Company  reports  other  comprehensive  income in  accordance  with
Statement  of  Financial  Accounting  Standards  ("SFAS")  No.  130,  "Reporting
Comprehensive   Income."  Total   comprehensive   income  was   $35,644,000  and
$39,683,000  for the three months  ended March 31, 1999 and 1998,  respectively.
The  primary  component  of  comprehensive  income  other  than net  income  was
unrealized losses on retained interest in securitization transactions.

                                       4
<PAGE>
NEW ACCOUNTING STANDARDS

         In June 1998, the FASB issued SFAS No. 133,  "Accounting for Derivative
Instruments  and Hedging  Activities,"  ("SFAS No. 133") which is effective  for
fiscal years  beginning  after June 15, 1999.  This statement  standardizes  the
accounting for derivative instruments,  including certain derivative instruments
embedded  in other  contracts,  by  recognition  of those  items  as  assets  or
liabilities  in the  statement of financial  position  and  measurement  at fair
value.  FINOVA will adopt this standard  effective January 1, 2000, as required.
The impact of SFAS No. 133 on the  Company's financial position  and  results of
operations has not yet been determined.

NOTE C INVESTMENTS

         Investments  increased  significantly  over the  prior  year due to the
acquisition  of Sirrom (as discussed in Note E) on March 22, 1999. The following
table sets forth a summary of the major components of investments:

                                                  March 31,         December 31,
                                                    1999                1998
                                                  --------            --------
Marketable investments                            $  4,992            $  1,713
Joint venture investments                           96,177              89,217
Other investments                                  109,835              33,862
                                                  --------            --------
                                                  $211,004            $124,792
                                                  ========            ========

         Marketable  investments  are  principally  composed of publicly  traded
shares of common  stock and  warrants  for the  purchase  of common  stock.  Net
unrealized gains on these securities were not significant at March 31, 1999.

         Joint venture  investments  include  equity  investments  in non-public
entities in which the Company holds a 20% or greater equity interest.

         Other  investments  include common stock,  preferred stock and warrants
which are not publicly traded and equity  investments in which the Company holds
less than 20% of the investee's equity.

NOTE D SEGMENT REPORTING

MANAGEMENT'S POLICY FOR IDENTIFYING REPORTABLE SEGMENTS

         FINOVA's reportable business segments are strategic business units that
offer  distinctive  products and services  that are marketed  through  different
channels.

RECONCILIATION OF SEGMENT INFORMATION TO CONSOLIDATED AMOUNTS

         Management  evaluates the business  performance  of each group based on
total net revenue,  income  before  allocations  and managed  assets.  Total net
revenue is  operating  margin plus gains on disposal  of assets.  Income  before
allocations  is income before income taxes and  preferred  dividends,  excluding
allocation  of  corporate  overhead  expenses  and the  unallocated  portion  of
provision for credit losses.  Managed assets includes each segment's  investment
in financing transactions plus securitizations and participations sold.

                                       5
<PAGE>
         Information  for FINOVA's  reportable  segments  reconciles to FINOVA's
consolidated totals as follows:

                                                  Three Months Ended March 31,
                                                 ------------------------------
Dollars in Thousands                                 1999              1998
--------------------                             ------------       -----------
TOTAL NET REVENUE:
  Commercial Finance                             $     51,706       $    45,999
  Specialty Finance                                    94,231            74,351
  Capital Markets                                       9,416             9,530
  Corporate and other                                  (5,582)             (816)
                                                 ------------       -----------
Consolidated total                               $    149,771       $   129,064
                                                 ============       ===========
INCOME (LOSS) BEFORE ALLOCATIONS:
  Commercial Finance                             $     24,348       $    17,954
  Specialty Finance                                    77,743            59,251
  Capital Markets                                         (17)            3,121
  Corporate and other, overhead and
   unallocated provision for credit losses            (19,302)          (13,640)
                                                 ------------       -----------
Income from continuing operations
  before income taxes                            $     82,772       $    66,686
                                                 ============       ===========

                                                            March 31,
                                                 ------------------------------
                                                     1999              1998
                                                 ------------       -----------
MANAGED ASSETS:
  Commercial Finance                             $  3,258,093       $ 2,763,155
  Specialty Finance                                 7,337,715         6,151,661
  Capital Markets                                     925,366           181,243
  Corporate and other                                  94,477            57,729
                                                 ------------       -----------
Consolidated total                                 11,615,651         9,153,788
Less securitizations and participations sold         (529,635)         (464,550)
                                                 ------------       -----------
Investment in financing transactions             $ 11,086,016       $ 8,689,238
                                                 ============       ===========

NOTE E ACQUISITION OF SIRROM CAPITAL CORPORATION

         In March 1999,  FINOVA  acquired  Sirrom,  a specialty  finance company
headquartered in Nashville,  Tennessee.  The acquisition was accounted for using
the purchase  method of accounting.  The purchase price was  approximately  $343
million in FINOVA common stock,  excluding converted stock options. Total assets
acquired were $620  million,  including $66 million in goodwill and $277 million
in assumed liabilities and transaction costs.  Goodwill is subject to change due
to a preliminary  estimate of fair values of various  private  equities and loan
balances at the date of  acquisition.  Goodwill is being amortized over 25 years
and  covenants  not to  compete,  which  are  included  in  goodwill,  are being
amortized over 3 years.

         After making certain accounting adjustments, the accompanying unaudited
pro forma  information  gives  effect to the  merger  as if it had  occurred  on
January 1, 1999 and 1998 and combines the historical consolidated information of
FINOVA and Sirrom for the quarters ended March 31, 1999 and 1998.

         The unaudited  comparative  pro forma  information  is not  necessarily
indicative of the results that actually  would have occurred had the merger been
consummated  on the dates  indicated or that may be obtained in the future.  The
unaudited  pro  forma  financial   information  does  not  give  effect  to  the
anticipated  cost savings and other synergies that may result from the merger or
the possible cash-out of existing stock options held by employees of Sirrom that
became fully vested by reason of the adoption of the merger  agreement by Sirrom
stockholders.  Included  in the  historical  operations  of Sirrom for the first
quarter  of 1999 are  approximately  $24  million  of  nonrecurring  charges,  a
significant portion of which related to the acquisition.

                                       6
<PAGE>
Comparative Pro Forma Information                   Three Months Ended March 31,
(Dollars in thousands, except per share data)         1999               1998
---------------------------------------------       --------           --------
Total revenue                                       $288,402           $248,341

Net (Loss) income                                   $ (4,793)          $ 35,770

(Loss) Earnings per share - diluted                 $  (0.06)          $   0.55

(Loss) Earnings per share - basic                   $  (0.08)          $   0.58

         The  acquisition   resulted  in  an  excess  purchase  price  over  the
historical  net  assets  acquired.  The  excess is  allocated  to the net assets
acquired and liabilities assumed, as follows:

Allocation of purchase price:

Purchase price                                                     $ 342,730
Elimination of historical stockholders' equity of Sirrom            (262,000)
                                                                   ---------
Estimated excess purchase price                                    $  80,730
                                                                   =========
Allocation of excess:
  Elimination of unamortized debt costs                            $  (3,360)
  Deferred income taxes                                               43,309
  Assumed liabilities                                                (25,127)
  Goodwill                                                            65,908
                                                                   ---------
                                                                   $  80,730
                                                                   =========

NOTE F RESTATEMENT

         Subsequent to the issuance of the Company's  financial  statements  for
the year ended  December 31, 1998,  the  Company's  management  determined  that
expenses incurred in connection with the origination of new loans under SFAS No.
91,  "Accounting for Nonrefundable Fees and Costs Associated with Originating or
Acquiring  Loans and Initial Direct Costs of Leases" (SFAS No. 91),  should have
been  deferred and  amortized  over the  estimated  loan life.  Previously,  the
Company was deferring loan  origination  fees received and amortizing  them over
the lives of the loans in  accordance  with SFAS No. 91, but  elected to expense
loan  origination  costs as  incurred.  Accordingly,  the Company  restated  its
condensed consolidated financial statements for the three months ended March 31,
1998 to  defer  and  amortize  loan  costs  over the  estimated  loan  life,  in
accordance with SFAS No. 91 as well as to make several other adjustments.

                                       7
<PAGE>
         A summary of the significant  effects of the restatements for the three
months ended March 31, 1998 is as follows:

                                                As previously
                                                  Reported           As restated
                                                  --------           -----------
For the three months ended March 31, 1998

Interest margins earned                           $ 108,657           $ 105,383
Gains on disposal of assets                           1,223               1,525
Operating expenses                                  (56,958)            (52,878)
Net income                                           39,077              39,741

Basic earnings per share                          $    0.70           $    0.71
Diluted earnings per share                        $    0.66           $    0.67


NOTE G PORTFOLIO QUALITY

         The following  table presents a  distribution  (by line of business) of
the Company's investment in financing transactions before the reserve for credit
losses at the dates indicated.

                                       8
<PAGE>
                      INVESTMENT IN FINANCING TRANSACTIONS
                               BY LINE OF BUSINESS
                                 MARCH 31, 1999
                             (Dollars in Thousands)
<TABLE>
<CAPTION>

                                         Revenue Accruing                  Nonaccruing
                               ----------------------------------   ---------------------------
                                                        Repos-                 Repos-    Leases     Total
                                  Market                sessed                 sessed      &       Carrying
                                 Rate (1)   Impaired   Assets (2)   Impaired   Assets    Other      Amount      %
                               -----------  ---------  ----------   --------   ------    -----    -----------  ----
<S>                           <C>          <C>         <C>         <C>       <C>       <C>       <C>         <C>
Transportation Finance (3)     $ 2,081,910  $  60,426   $           $         $         $         $2,142,336   19.3
Resort Finance                   1,286,026               16,829          668    24,982             1,328,505   12.0
Rediscount Finance                 863,195               20,787          788       573               885,343    8.0
Corporate Finance                  777,631     15,577                 40,606     1,089               834,903    7.5
Commercial Equipment Finance       716,913      2,379     5,935        8,322    20,104    4,223      757,876    6.8
Specialty Real Estate Finance      637,180     16,890    34,004        9,702     7,684      194      705,654    6.4
Communications Finance             657,462      7,161                 24,252                         688,875    6.2
Franchise Finance                  677,099      1,578     1,773        2,017     1,099      269      683,835    6.2
Healthcare Finance                 633,446        750     6,313        5,375              1,942      647,826    5.8
Distribution & Channel Finance     578,734                             6,325                         585,059    5.3
Mezzanine Capital                  465,156                            12,337                         477,493    4.3
Realty Capital                     430,384                                                           430,384    3.9
Business Credit                    312,193                            16,493                         328,686    3.0
Public Finance                     216,235                                                           216,235    1.9
Commercial Services                195,088        147                  6,451       898               202,584    1.8
Growth Finance                      55,338                             3,119                          58,457    0.5
Other (4)                           65,572                                               28,904       94,476    0.9
Investment Alliance                 17,489                                                            17,489    0.2
                               -----------   --------   -------     --------  --------  -------  -----------  -----
TOTAL (5)                      $10,667,051   $104,908   $85,641     $136,455  $ 56,429  $35,532  $11,086,016  100.0
                               ===========   ========   =======     ========  ========  =======  ===========  =====
</TABLE>
----------
NOTES:
(1)  Represents original or renegotiated  market rate terms,  excluding impaired
     transactions.
(2)  The Company  earned income  totaling  $1.57 million on  repossessed  assets
     during the three months ended March 31, 1999,  including  $0.59  million in
     Specialty Real Estate Finance, $0.3 million in Resort Finance, $0.2 million
     in Healthcare Finance,  $0.4 million in Rediscount Finance, $.05 million in
     Commercial Equipment Finance and $.03 million in Franchise Finance.
(3)  Transportation  Finance  includes  $420.5  million  of  aircraft  financing
     business originated in the London office.
(4)  Primarily  includes  other assets  retained from  disposed or  discontinued
     operations.
(5)  Excludes $529.6 million of assets securitized and participations sold which
     the  Company  manages,  including  securitizations  of  $300.0  million  in
     Corporate   Finance   and  $128.6   million  in   Franchise   Finance   and
     participations sold of $43.4 million in Corporate Finance, $21.2 million in
     Communications  Finance,  $5.6 million in Resort Finance,  $10.5 million in
     Rediscount  Finance,  $5.1  million in Business  Credit,  $11.2  million in
     Transportation  Finance, $2.1 million in Growth Finance and $1.9 million in
     Distribution & Channel Finance.

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

                                       9
<PAGE>
RESERVE FOR CREDIT LOSSES:

         The reserve for credit losses at March 31, 1999  represents 2.1% of the
Company's investment in financing  transactions and securitized assets.  Changes
in the reserve for credit losses were as follows:

                                                   Three Months Ended March 31,
                                                  -----------------------------
                                                    1999                 1998
                                                  ---------           ---------
                                                      (Dollars in Thousands)
Balance, beginning of period                      $ 207,618           $ 177,088
Provision for credit losses                           9,500               9,500
Write-offs                                           (9,142)            (13,912)
Recoveries                                              739                 806
Reserves related to acquisitions                     25,151               2,460
Other                                                 4,411                  25
                                                  ---------           ---------
Balance, end of period                            $ 238,277           $ 175,967
                                                  =========           =========

         At March 31,  1999 the total  carrying  amount  of  impaired  loans was
$241.4  million,  of which $104.9 million were revenue  accruing.  A reserve for
credit  losses  of $55.4  million  has been  established  for $99.4  million  of
nonaccruing  impaired  loans and $7.2  million  has been  established  for $26.1
million of accruing  impaired loans. The remaining $175.7 million of the reserve
for credit losses is designated for general purposes and represents management's
best estimate of potential  losses in the portfolio  considering  delinquencies,
loss experience and collateral.  Additions to the general and specific  reserves
are reflected in current  operations.  Management may transfer  reserves between
the general and specific reserves as considered necessary.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
        AND RESULTS OF OPERATIONS

               COMPARISON OF THE THREE MONTHS ENDED MARCH 31, 1999
                TO THE RESTATED THREE MONTHS ENDED MARCH 31, 1998

         THE  FOLLOWING  DISCUSSION  RELATES  TO THE FINOVA  GROUP INC.  AND ITS
SUBSIDIARIES (COLLECTIVELY, "FINOVA" OR THE "COMPANY"), INCLUDING FINOVA CAPITAL
CORPORATION AND ITS SUBSIDIARIES (COLLECTIVELY, "FINOVA CAPITAL").

         Subsequent to the issuance of the Company's  financial  statements  for
the year ended  December 31, 1998,  the  Company's  management  determined  that
expenses incurred in connection with the origination of new loans under SFAS No.
91,  "Accounting for Nonrefundable Fees and Costs Associated with Originating or
Acquiring  Loans and Initial Direct Costs of Leases" (SFAS No. 91),  should have
been  deferred and  amortized  over the  estimated  loan life.  Previously,  the
Company was deferring loan  origination  fees received and amortizing  them over
the lives of the loans in  accordance  with SFAS No. 91, but  elected to expense
loan  origination  costs as  incurred.  Accordingly,  the Company  restated  its
condensed consolidated financial statements for the three months ended March 31,
1998 to now defer and  amortize  loan costs  over the  estimated  loan life,  in
accordance with SFAS No. 91 as well as to make several other adjustments.

         The effects of the  restatements  for the three  months ended March 31,
1998 are  presented  in Note F of the Notes to  Interim  Consolidated  Financial
Statements, and have been reflected herein.

                                       10
<PAGE>
RESULTS OF OPERATIONS

         Net income for the three months ended March 31, 1999 was $50.1  million
($0.83 per  diluted  share)  compared  to a restated  $39.7  million  ($0.67 per
diluted  share) for the three months ended March 31, 1998. The 1999 earnings per
share  computation  includes a higher average share count due to the 6.1 million
additional shares issued on March 22, 1999 for the acquisition of Sirrom Capital
Corporation  and 0.2 million shares for the  acquisition  of Preferred  Business
Credit, Inc. ("PBC") on February 17, 1999. The 1998 net income has been restated
to reflect the deferral of costs incurred in connection  with new loan and lease
originations in accordance with SFAS No. 91, among other  adjustments  described
more fully in the Company's report on Form 10-K/A,  Amendment No. 2 for the year
ended  December 31, 1998.  The effect of deferring  expenses in accordance  with
SFAS 91 increased  net income by $1.2 million  ($0.02 per diluted  share) in the
first quarter of 1999.

         INTEREST  MARGINS  EARNED.   Interest  margins  earned  represents  the
difference  between (a) interest and income earned from  financing  transactions
and  operating  lease  income  and (b)  interest  expense  and  depreciation  on
operating  leases.  Interest  margins  earned were $124.7  million for the first
three  months of 1999,  an increase  of 18.3% over  interest  margins  earned of
$105.4  million for the first quarter of 1998. The increase was primarily due to
a 27% increase in managed  assets to $11.62 billion at March 31, 1999 from $9.15
billion at March 31, 1998.  Interest  margins  earned as a percentage of average
earning assets declined to 5.1% in the first quarter of 1999 compared to 5.3% in
the first quarter of 1998.  Approximately  10 to 15 basis points of the decrease
in spread was the result of average  leverage  being higher in 1999  compared to
the first  quarter  of 1998.  Another  portion  of the  decrease  was due to the
strategy in the fourth  quarter of 1998 of funding  the  balance  sheet into the
first  quarter of 1999.  This  eliminated  liquidity  risk for the Company,  but
resulted in a modestly higher cost of funds. Additionally, competitive pressures
impacted the Commercial Finance segment.

         VOLUME-BASED  FEE  INCOME.  Volume-based  fee  income is  generated  by
FINOVA's Distribution & Channel Finance,  Commercial Services and Realty Capital
lines of  business.  These  fees are  predominately  based on volume  originated
rather than the balance of outstanding financing transactions during the period.
Volume-based fee income for the first quarter of 1999 was $12.7 million compared
to $22.2  million in the first quarter of 1998.  The decline  relates to a lower
fee-based volume generated by Realty Capital and Commercial  Services during the
1999 quarter and the effect of a $4.5  million fee  received  from one of Realty
Capital's trading partners in early 1998. On a comparable basis, the average fee
received  during the  quarter by the  Company  per  dollar of  fee-based  volume
decreased by 11 basis points in 1999 from the 1998 first quarter. The lower fees
combined with higher  leverage  caused the  operating  margin as a percentage of
average earning assets to decline to 5.6% in the first quarter of 1999 from 6.4%
in the first  quarter of 1998.  Fee-based  volume for the first three  months of
1999 totaled $1.47 billion compared to $1.80 billion in the same period one year
ago.

         PROVISION FOR CREDIT  LOSSES.  The provision for credit losses was $9.5
million  for the three  months  ended March 31,  1999 and 1998.  Net  write-offs
during the first three months of 1999 totaled  $8.4  million,  compared to $13.1
million in the first quarter of 1998.

         GAINS ON DISPOSAL OF ASSETS. Gains on the disposal of assets were $12.4
million in the first quarter of 1999,  compared to $1.5 million  during the same
period a year ago.  The  gains in 1999 were  principally  realized  by  FINOVA's
Specialty  Finance segment and were primarily from the sale of assets coming off
lease and  other  assets.  While,  in the  aggregate,  FINOVA  has  historically
recognized  gains on such  disposals,  the timing  and amount of these  gains is
sporadic in nature.  The Company has added a number of  businesses  that rely on
gains to achieve  their  returns.  These  businesses  supplement  FINOVA's  core

                                       11
<PAGE>
spread-based  business.  Typically these gains have  approximated  10% to 15% of
FINOVA's annual net income. There can be no assurance FINOVA will recognize such
gains in the future,  depending,  in part,  on market  conditions at the time of
sale.

         OPERATING  EXPENSE.  Operating  expenses were  generally  higher in all
major categories and increased to $57.5 million during the first three months of
1999  compared to $52.9  million for the three months  ended March 31, 1998,  an
increase of 9%. The increase  was  primarily  due to personnel  added (1,362 vs.
1,130)  through  acquisitions  and as a result  of  growth  in  managed  assets.
Operating expenses improved as a percent of operating margin plus gains to 38.4%
in 1999 from 41.0% in the first quarter of 1998.

         INCOME  TAXES.  Income  taxes were higher in the first  quarter of 1999
than the first quarter of 1998 primarily due to the increase in pre-tax income.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

         At March 31, 1999,  managed assets  totaled $11.62 billion  compared to
$10.56  billion at December  31,  1998 an  increase of 10%.  Included in managed
assets at March 31, 1999 are $11.09 billion in funds employed  (including $345.5
million of financing contracts held for sale generated by FINOVA Realty Capital;
$176.8 million at April 30, 1999),  $428.6 million of securitized assets managed
by FINOVA  and $101.0  million  of  participations  sold to third  parties.  The
increase in managed  assets was due to funded new business of $1.06  billion for
the three  months  ended  March 31,  1999,  compared  to $692.1  million for the
quarter  ended March 31, 1998,  plus  acquired  managed  assets of $486 million,
partially offset by normal portfolio amortization and prepayments.

         The reserve for credit losses  increased to $238.3 million at March 31,
1999 from $207.6  million at December 31, 1998.  At March 31, 1999,  the reserve
for  credit  losses   represents  2.1%  of  ending  managed  assets   (excluding
participations)  compared to 2.0% at year-end.  Non-accruing assets at March 31,
1999 increased to $228.4  million,  or 2.0% of ending managed assets  (excluding
participations),  compared to $205.2  million,  or 2.0% of ending managed assets
(excluding  participations)  at year end. The Sirrom  acquisition  included $469
million of lending  assets,  $12 million (2.6%) of which were  nonaccruing.  The
reserve for credit losses  against the acquired  Sirrom lending assets was $24.9
million or 5.3%.

         At March  31,  1999,  FINOVA  had  $9.33  billion  of debt  outstanding
compared to $8.39  billion at December 31,  1998.  Included in debt at March 31,
1999  is  approximately   $4.13  billion  of  commercial  paper  and  short-term
borrowings supported by unused long-term revolving-credit  agreements.  FINOVA's
debt at the end of the first quarter of 1999 is 5.59 times the company's  equity
base of $1.67 billion (including $111.6 million of convertible preferred stock).
At year-end 1998, FINOVA's debt was 6.56 times the equity base of $1.28 billion.

         Growth in funds employed is financed by FINOVA's  internally  generated
funds and new borrowings.  During the three months ended March 31, 1999,  FINOVA
issued $956 million of new long-term borrowings and recognized a net increase in
commercial  paper  outstanding of $286 million.  During the same period,  FINOVA
repaid $309 million of long-term borrowings.

                                       12
<PAGE>
SEGMENT REPORTING

         FINOVA's business is organized into three market groups, which are also
its  reportable  segments:  Commercial  Finance,  Specialty  Finance and Capital
Markets.  Management  principally  relies on total net  revenue,  income  before
allocations  and managed assets in evaluating  the business  performance of each
reportable segment.

         Total net revenue is the sum of operating  margin and gains on disposal
of assets.  Income before  allocations is income before income taxes,  preferred
dividends,  corporate  overhead  expenses  and the  unallocated  portion  of the
provision for credit losses. Managed assets include each segment's investment in
financing transactions plus securitizations and participations sold.

         COMMERCIAL FINANCE. Commercial Finance includes traditional asset-based
businesses  that  lend  against  collateral  such  as  cash  flows,   inventory,
receivables and leased assets.

         Total net revenue was $51.7  million in 1999  compared to $46.0 million
for the first quarter of 1998, an increase of 12.4%.  The increase was primarily
due to a 17.9%  increase  in  managed  assets  over the first  quarter  of 1998,
partially  offset by a decrease  in  fee-based  volume in  Commercial  Services.
Overall,  fee-based volume decreased to $1.09 billion in 1999 from $1.15 billion
in the first quarter of 1998.

         Income  before  allocations  increased  35.6% to $24.3  million in 1999
compared to $18.0 million in the first quarter of 1998. In addition to portfolio
growth, the increase resulted from lower write-offs in 1999.

         Managed  assets grew to $3.3 billion in the first  quarter of 1999 from
$2.8 billion in 1998. Strong growth in Rediscount  Finance,  Business Credit and
the recent  acquisitions  of Growth Finance and Preferred  Business Credit drove
the growth in managed assets.  Excluding the recent acquisitions, managed assets
grew by 15.7%.

         SPECIALTY FINANCE. Specialty Finance includes businesses that lend to a
variety of highly focused industry-specific niches.

         Total net revenue increased 26.7% to $94.2 million in the first quarter
of 1999, compared to $74.4 million in 1998, while income before allocations grew
31.2% to $77.7 million in the first quarter of 1999 compared to $59.3 million in
1998.  Both  increases  were  primarily  due to 19.7% growth in average  earning
assets.  The segment was able to keep net  write-offs  at a relatively  constant
rate, while decreasing  operating expenses as a percentage of spread and average
managed assets.

         Managed  assets grew to $7.3 billion in the first  quarter of 1999 from
$6.2  billion in 1998,  an increase of 19.3%.  The growth in managed  assets was
driven by new business of $3.2 billion  during the 12 months ended in March 1999
compared to $2.5 billion  during the 12 months  ended in March 1998.  The growth
was spread across all business units with  Transportation  Finance and Franchise
Finance contributing most to the growth in managed assets.

         CAPITAL  MARKETS.  Capital Markets,  in conjunction with  institutional
investors,  provides  commercial  mortgage  banking services and debt and equity
capital funding.  Mezzanine  Capital  (formerly Sirrom Capital  Corporation) was
added to this segment at the acquisition date, March 22, 1999.

         Total  net  revenue  was $9.4  million  in the  first  quarter  of 1999
compared to $9.5  million in 1998.  Loss  before  allocations  was $17  thousand
compared  to income of $3.1  million in 1998.  The  decrease  in net revenue and

                                       13
<PAGE>
income  before   allocations   was  primarily   attributable  to  a  decline  in
volume-based  fees to $1.6 million in the first quarter of 1999 compared to $9.3
million in 1998,  resulting from the lower  fee-based  volume  generated,  lower
returns  on fee  volume  generated  and  higher  operating  expenses  during the
quarter. Offsetting the 1999 decline were increases in loan revenue and gains on
disposal of assets.

         Managed  assets grew to $925 million at March 31, 1999 compared to $181
million at March 31, 1998,  from the  acquisition  of Mezzanine  Capital and the
increase in financing contracts held for sale.

YEAR 2000 COMPLIANCE

         FINOVA continues to implement changes necessary to help assure accurate
date  recognition  and data processing with respect to the year 2000. To be year
2000 compliant means (1) significant  information  technology  ("IT") systems in
use by FINOVA  demonstrate  performance and functionality that is not materially
affected by  processing  dates on or after  January 1, 2000,  (2)  customers and
collateral  included in FINOVA's  portfolio of business are year 2000  compliant
and (3) vendors of services  critical to FINOVA's  business  processes  are year
2000 compliant.

         FINOVA's  non-IT  systems  used to conduct  business at its  facilities
consist  primarily of office equipment  (other than computer and  communications
equipment)  and  other  equipment  at  leased  office  facilities.   FINOVA  has
inventoried its non-IT systems and has sent year 2000  questionnaires  to office
equipment  vendors  and  landlords  to  determine  the status of their year 2000
readiness.

         Primary internal  activities related to this issue are modifications to
existing  computer  programs  and  conversions  to new  programs.  FINOVA  has a
five-phase plan for assuring year 2000 compliance of its internal systems:

1)   Identifying  each area,  function and application that could be affected by
     the change in date.
2)   Determining the extent to which each area,  function or application will be
     affected by the change in date and  identifying the proper course of action
     to eliminate adverse effects.
3)   Making the changes necessary to bring the system into year 2000 compliance.
4)   Testing the integrated system.
5)   Switching to year 2000 compliant applications.

         As of March 31, 1999, FINOVA has completed all the necessary changes to
make mission  critical  applications  year 2000 compliant.  FINOVA now estimates
that 99% of its  portfolio  is on  systems  that are  ready  for the  change  in
century.  Acquisitions  made during 1998 are expected to be on compliant systems
by the end of the second quarter.  Similarly,  acquisitions  made or proposed in
1999 are being  reviewed with year 2000  compliance  issues to be addressed in a
prompt manner.  Where possible,  new  acquisitions  will be migrated to existing
FINOVA applications that are already year 2000 ready.

         Costs  incurred  to bring  FINOVA's  internal  systems  into  year 2000
compliance  are not  expected to have a material  impact on FINOVA's  results of
operations.  Maintenance and modification costs are expensed as incurred,  while
the costs of new hardware and software are  capitalized and amortized over their
estimated useful lives. FINOVA estimates it will incur approximately $300,000 in
expenses  and $1.8  million in capital  costs  related to year 2000  compliance.
Estimates  are reviewed and revised as necessary on a quarterly  basis.  Through
March 31, 1999,  FINOVA has incurred  expenses of $158,000 and capital  costs of
$1.5 million.

         FINOVA's  aggregate  cost estimate does not include time and costs that
may be incurred  as a result of the failure of any third  parties to become year
2000 compliant.  FINOVA is  communicating  with customers,  software vendors and

                                       14
<PAGE>
others to determine if their  applications  or services are year 2000  compliant
and to assess the potential impact on FINOVA related to this issue.

         Risks to FINOVA  include  that third  parties  may not have  accurately
assessed  their state of  readiness.  Similarly,  FINOVA  cannot assure that the
systems of other  companies and government  agencies on which FINOVA relies will
be converted in a timely  manner.  While FINOVA  believes all necessary  work on
internal  systems  will  be  completed  in a  timely  fashion,  there  can be no
guarantee  that all systems  will be  compliant  by the year 2000 and within the
estimated cost. Any of these  occurrences  could cause a material adverse effect
on FINOVA's results of operations.

         FINOVA  routinely  assesses  the year  2000  compliance  status  of its
borrowers  and  generally  requires  that  they  provide   representations   and
warranties regarding the status.  FINOVA also attempts to monitor their progress
with questionnaires and other means.

         FINOVA  believes  under its  reasonably  possible  worst case year 2000
scenario,  a number of its borrowers and service  providers would not be capable
of performing their contractual  obligations to FINOVA.  The financial impact of
this scenario and the Company's responses are currently under assessment.

         FINOVA is assessing the need for contingency plans related to year 2000
compliance in the first half of 1999. It plans to develop additional contingency
plans as necessary  throughout 1999.  FINOVA  maintains and deploys  contingency
plans designed to address various other  potential  business  interruptions.  In
some respects,  these plans may address interruptions resulting from FINOVA or a
third  party's  failure to be year 2000  compliant,  but the plans have not been
updated to specifically address the year 2000 issue as of March 31, 1999.

                                       15
<PAGE>
RECENT DEVELOPMENTS AND BUSINESS OUTLOOK

         FINOVA continues to seek new business by emphasizing  customer service,
providing  competitive  interest  rates and focusing on selected  market niches.
Additionally,  FINOVA continues to evaluate potential acquisition  opportunities
it believes are consistent with its business strategies.

         In April 1999,  approximately 70% of the mini-CMBS loans were sold into
a permanent CMBS structure.

         A summary of the  revaluation  of the sale of assets into the mini-CMBS
structure and the  subsequent  results of the sale of  approximately  70% of the
mini CMBS loans into a permanent CMBS structure in April 1999 is as follows. The
results of the April 1999 transaction will be reported in the second quarter.

                                         Mini-CMBS Structure - 1998     1999
                                         ---------------------------------------
                                           As Previously     As      Sale of 70%
                                              Reported    restated    in April
                                              --------    --------    --------
                                                   Dollars in Thousands

Loans sold into CMBS Structure                $724,257     $724,257   $

Proceeds - Permanent CMBS Structure                                    526,270

Principal A (Senior security interest)         678,686      678,686    474,650
Principal B (Subordinated retained interest)    91,708       65,033     45,206
                                              --------     --------   --------
Basis                                          770,394      743,719    519,856

Gross gain                                      46,137       19,462      6,414

Commissions & expenses                          (3,862)      (3,156)    (4,433)
Recourse obligations                              (278)      (5,827)     4,091
Hedge (losses) gains                           (20,443)     (20,443)     6,223
Valuation adjustment                            (5,500)
                                              --------     --------   --------
Net gain/(loss)                               $ 16,054     $ (9,964)  $ 12,295
                                              ========     ========   ========

         Including stock repurchases  through May 13, 1999,  FINOVA  repurchased
1.5 million shares of its common stock during 1999. These shares are intended to
fund awards under FINOVA's stock incentive plan.

         In the second quarter of 1999,  FINOVA  expanded its credit  facilities
supporting its commercial paper program to an aggregate of $4.5 billion, through
the addition of a new $500 million,  364 day  revolving  credit  agreement  with
various lenders.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         There were no material  changes  from the  information  provided in the
report on Form 10-K/A, Amendment No. 2 for the year ended December 31, 1998.

                                       16
<PAGE>
                           PART II - OTHER INFORMATION

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

     (a)  The following exhibits are filed herewith:

          Exhibit No.          Document
          -----------          --------

              11       Computation of Earnings Per Share.  (incorporated by
                       reference from the  Company's  Form 10-Q for the period
                       ended March 31, 1999, filed on May 17, 1999.

              12       Computation of Ratio of Income to Fixed Charges and
                       Preferred Stock Dividends (interim period). (incorporated
                       by reference from the Company's  Form 10-Q for the period
                       ended March 31, 1999, filed on May 17, 1999.

              27       Financial Data Schedule for the three months ended
                       March 31, 1999. (incorporated by reference from the
                       Company's  Form 10-Q for the period ended March 31, 1999,
                       filed on May 17, 1999.


     (b)  Reports on Form 8-K:

          A Report on Form 8-K,  dated March 22, 1999,  was filed by  Registrant
     which reported under Items 5 and 7 the  consummation  of the acquisition of
     Sirrom Capital Corporation and related information.

          A Report on Form 8-K,  dated April 14, 1999,  was filed by  Registrant
     which reported under Items 5 and 7 the  postponement  of the release of its
     reported earnings for the first quarter of 1999 and potential  revisions to
     its 1998 financial statements.

          A Report on Form 8-K, dated May 7, 1999, was filed by Registrant which
     reported  under  Items  5 and 7  the  revenues,  net  income  and  selected
     financial  data and  ratios  for the first  quarter  ended  March 31,  1999
     (unaudited) and certain additional information.

                                       17
<PAGE>
                              THE FINOVA GROUP INC.


                                   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.


                                  THE FINOVA GROUP INC.
                                      (Registrant)



Dated: September 8, 1999          By: /s/ Bruno A. Marszowski
                                     -------------------------------------------
                                     Bruno A. Marszowski, Senior Vice President,
                                     Chief Financial Officer and Controller
                                     Principal Financial and Accounting Officer

                                       18