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                    SECURITIES AND EXCHANGE COMMISSION
                         WASHINGTON, DC 20549-1004

                                 FORM 10-K

               Annual Report Pursuant to Section 13 or 15(d)
           of the Securities Exchange Act of 1934 (Fee Required)

     For the 52-Week Period Ended            Commission File
          December 30, 1995                  No. 0-17540

                       MONTGOMERY WARD HOLDING CORP.
          (Exact name of registrant as specified in its charter)

       DELAWARE                                   36-3571585
(State or other jurisdiction                  (I.R.S. Employer
of incorporation or organization)               Identification No.)

Montgomery Ward Plaza, Chicago, Illinois          60671-0042
(Address of principal executive offices)          (Zip Code)

Registrant's Telephone Number, including area code:  (312) 467-2000


        Securities registered pursuant to Section 12(b) of the Act

     Title of each class           Name of each exchange
                                   on which registered
       Not Applicable                    None

        Securities registered pursuant to Section 12(g) of the Act:
              Class A Common Stock, Series 1, $.01 Par Value
                             (Title of class)
              Class A Common Stock, Series 2, $.01 Par Value
                             (Title of class)
      Voting Trust Certificates representing Shares of Class A Common
                      Stock, Series 1, $.01 Par Value
                             (Title of class)
      Voting Trust Certificates representing Shares of Class A Common
                      Stock, Series 2, $.01 Par Value
                             (Title of class)
                   Class B Common Stock, $.01 Par Value
                             (Title of class)


  Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein, and
will not be contained, to the best of registrant's knowledge, in
definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K.       .
 
  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    .

  At March 20, 1996, there were 18,748,897 shares of Class A Common
Stock and 25,000,000 shares of Class B Common Stock of the
Registrant outstanding.

  Part III incorporates information by reference from the proxy
statement for the annual meeting of shareholders to be held on May
31, 1996.

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<PAGE>
                                  PART I
Item 1.  Business.

General

  Montgomery Ward Holding Corp., a Delaware corporation (the
Company or MW Holding), and its wholly-owned subsidiary, Montgomery
Ward & Co., Incorporated (Montgomery Ward), are engaged in retail
merchandising and direct response marketing (including insurance)
in the United States.  See Note 20 to the Consolidated Financial
Statements for financial information regarding these segments.

  Founded in 1872 and incorporated in Illinois in 1968, Montgomery
Ward is one of the nation's largest retail merchandising
organizations.  As of December 30, 1995, Montgomery Ward and its
wholly-owned subsidiary, Lechmere, Inc., a Massachusetts
corporation (Lechmere), operated 402 retail stores in 43 states
with approximately 29 million square feet of selling space.  In
addition, Montgomery Ward operated 10 liquidation centers which
sell overstock merchandise, 24 distribution facilities and 117
product service centers.

  Montgomery Ward offers life and health insurance, revolving
credit insurance, club products and other consumer services through
Signature Financial/Marketing, Inc.,  a Delaware corporation
(Signature), and through Signature's subsidiaries (collectively,
with Signature, the Signature Group).  The Signature Group is one
of the largest direct marketing companies in the United States.

Merchandising

  Montgomery Ward has grown to become one of the largest privately
held retailers in the United States with over $7 billion in annual
revenues.  The Company is among the largest retailers in the
country in electronics, appliances, furniture and fine jewelry.  It
is also one of the largest retailers of many prominent name brands,
including Sony, Maytag, General Electric, La-Z-Boy, Sealy, Lee,
Playtex and Bugle Boy.

  Montgomery Ward's specialty concepts combine a focus on specific
customer needs, dominant merchandise assortments, exclusive values,
updated presentation and aggressive marketing strategies.  The
specialty categories within Montgomery Ward are the following:

     Product Category              Specialty Concept
  Appliances and Electronics   Electric Ave. and
                                 Electric Ave. & More
  Home Furnishings             Home Ideas and Rooms & More
  Automotive                   Auto Express
  Apparel                      Apparel Store and Kids Store
  Jewelry                      Gold 'N Gems
<PAGE>
Item 1.  Business. (continued)

Merchandising (continued)

  Each specialty strategy has its own business structure which
focuses on its specific competition, customer preferences and
merchandising, marketing and customer service priorities.  However,
being a leading national retailer with multiple specialty concepts
provides the Company with significant buying and cost leverage.

  Electric Ave. is a combined consumer electronics and appliance
superstore offering all major product categories, including video,
audio, home office, telephones, electronic games and kitchen,
laundry and other major appliances.  Electric Ave. has a
significant national brand name assortment, including Sony, General
Electric, Whirlpool, Maytag, Apple, Bose, R.C.A., Magnavox,
Toshiba, Amana and J.V.C.  To complement its national brands,
Montgomery Ward's exclusive proprietary brand offering in
appliances features the Admiral name under a trademark licensing
agreement.

  Home Ideas offers a full complement of home furnishings with
broad selections emphasizing name brands in furniture and small
ticket lines for the bath, bedroom and kitchen.  The Rooms & More
concept offers accessorized furniture room groupings to provide
customers the convenience of coordinated furniture pieces and
accessories aggressively priced through tiered discounts on the
purchase of multiple pieces.  The broad name brand selection
includes Bassett and La-Z-Boy, and the Company is one of the few
retailers to offer all four major mattress brands (Simmons, Sealy,
Serta and Spring Air), and it recently added Stearns & Foster.  The
success of the Home Ideas and Rooms & More specialty concepts has
resulted in Montgomery Ward being one of the three largest
furniture retailers in the United States.

  Auto Express focuses on the sale and installation of tires,
batteries, brakes and shocks.  Montgomery Ward is one of the
leading retailers of branded tires, including Goodyear, Firestone,
Michelin, Bridgestone and B.F. Goodrich.  Other major brands
include Exide, Monroe and NAPA.  Auto Express supplements its
dominant merchandise offering with a strong commitment to customer
service and a focus on those services it is capable of delivering
at a high performance level.  Auto Express adds creditability to
its service commitment through its marketing pledges which include
price matching guarantees, service time guarantees and a "No
Excuses" refund/replacement guarantee for 30 days following
service.

<PAGE>
Item 1.  Business. (continued)

Merchandising (continued)

  The Apparel Store and Kids Store offer branded, value oriented
merchandise in women's, men's, children's and intimate apparel as
well as footwear and accessories.  The apparel brand and price
point offering is targeted at the large middle market between
department stores and discounters.  Each category delivers a
focused, contemporary and coordinated offering which matches middle
income casual and career lifestyles.  An impressive offering of
prominent name brands has been  built, including Lee, Playtex,
Bugle Boy, Bestform, Converse, Gloria Vanderbilt, Hanes and Botany. 
In addition, the Company has developed licensed and proprietary
brands for certain product categories, such as Ship 'N Shore and
Connie Selleca in women's apparel and BIKE in activewear.

  Gold 'N Gems is a complete jewelry specialty concept offering all
major merchandise categories:  diamonds, gemstones, gold and
watches.  Gold 'N Gems emphasizes a broad selection at exceptional
values through a wide range of price points that spans across first
time buyers to shoppers desiring higher priced merchandise. 
Montgomery Ward has become one of the largest fine jewelry
retailers in the country, and its major vendor relationships enable
it to offer highly featured products at outstanding prices.

  Montgomery Ward currently operates 340 full line stores featuring
all of the specialty concepts and 62 stores featuring a variety of
other formats, including 28 Lechmere stores and 11 Electric Ave. &
More stores.  Full line Montgomery Ward stores average
approximately 75,000 square feet of selling space. 

  Montgomery Ward's retail business is seasonal, with over 30% of
the 1995 sales occurring in the fourth quarter.  The results of
Montgomery Ward's operations are also subject to changes in
consumer demand associated with general economic conditions, which
is especially true with respect to demand for durable goods and
other "big ticket" merchandise.
     
  Montgomery Ward's retail operations are supported by its
corporate buying division which has its principal office in
Chicago, and includes foreign purchasing offices in Italy, Hong
Kong, Taiwan, Japan, Singapore and Korea.  In addition to its
buying staff, the corporate buying division employs technical teams
to ensure quality control of Montgomery Ward's merchandise.

<PAGE>
Item 1.  Business. (continued)

  The Company considers logistics to be important to its operations
and has continually invested in this area.  The distribution
facilities opened in Phoenix, Tampa, Baltimore and southern
California in 1991 through 1994 added approximately 1.7 million
square feet of space and incorporate distribution management
systems which are dynamic in tracking merchandise and facilitating
inventory planning and customer service.  


Corporate Expansion

  In March 1994, Montgomery Ward acquired Lechmere, a chain of
Northeast-based superstores.  The Company's acquisition of Lechmere
adds substantial volume to a highly successful specialty segment of
the Company's business and strengthened its dominance as a major
retailer of home oriented products.  Lechmere offers extensive
selections of hardline merchandise and currently operates 28 stores
averaging approximately 50,000 square feet of selling space. 
Lechmere has built a strong customer franchise and is believed to
be the marketshare leader in the greater Boston area in many of the
products it sells.  It offers a comprehensive selection of
nationally recognized brands which are now being supplemented with
Montgomery Ward's successful proprietary brands.  Leverage
opportunities from the acquisition are being realized through added
buying volume and expense consolidation.
 
  Since 1985, Montgomery Ward has invested almost $1.4 billion in
capital expenditures to upgrade existing stores and add new stores. 
In 1995, Montgomery Ward opened 5 new Electric Ave. & More stores
and relocated 3 full line stores and has opened 72 new stores
(including 4 Lechmere stores) in the last 5 years.  The ongoing
store opening program has resulted in new stores representing a
significant portion, approximately 30%, of the Company's total
stores in major markets.  The Electric Ave. & More retail concept
combines Montgomery Ward's most successful strategies, Electric
Ave., Rooms & More and Gold 'N Gems, with Lechmere's strong
offering in entertainment and housewares to create a dominant home-
oriented product offering.  Electric Ave. & More is designed for
mid-size markets with populations of 200,000 to 250,000 and for a
superstore format of approximately 45,000 of selling square feet. 
Montgomery Ward has substantial buying and operating leverage
compared to the more limited competition in these markets.  In
addition to the opening of additional Electric Ave. & More stores,
the Company is planning to continue opening full line Montgomery
Ward stores in regional shopping centers and Lechmere stores in the
northeast United States. 
<PAGE>
Item 1.  Business. (continued)

Corporate Expansion (continued)

  On August 8, 1995, Montgomery Ward purchased a 4.4% equity
interest in ValueVision International, Inc. (ValueVison), through
an agreement allowing Montgomery Ward to acquire up to 49%
ownership of the company, should ValueVision achieve certain growth
targets in the number of cable homes that carry its programming. 
ValueVision also reached a 7-year, non-cancelable agreement with
Time Warner Cable Company to launch ValueVision programming in 2.5
million homes.  After this addition, 14 million homes will be able
to receive ValueVision programs, and 3.4 million of these will be
able to receive programming 24 hours per day.  ValueVision is now
the third largest home shopping enterprise in the United States and
has experienced over 50% sales growth since 1994.  See Note 19 to
the Consolidated Financial Statements for discussion of ValueVision
as a related party.

  In July, 1994, Montgomery Ward became a limited partner in
Merchant Partners, Limited Partnership (Merchant Partners).  The
purpose of this partnership is to invest in new and emerging growth
businesses and leveraged buy-outs to achieve a superior rate of
return.  Montgomery Ward made capital contributions of $4 million
to Merchant Partners, Limited Partnership in 1995 and $1 million in
1994.  Additional funding may be required within limitations set
forth in the limited partnership agreement.  The cumulative maximum
capital contribution is $40 million.  See Note 19 to the
Consolidated Financial Statements regarding a year-end distribution
by the partnership.   

  Montgomery Ward regularly reviews opportunities for acquisitions
and joint ventures and regards such transactions as a possible
source for future growth.


Performance Initiatives

  In mid-1995, a merchandising strategy offering branded, highly
featured product at extraordinary prices and value was reintroduced
as "Exclusive Values".  The significant sales volume generated by
Exclusive Values provides incremental economies of scale with
aggressive pricing that differentiates Montgomery Ward from
competition and yields attractive margin rates.  Based on positive
fourth quarter results in home oriented categories, Exclusive
Values are expected to achieve significant performance results in
1996.  By allowing for a more focused merchandise and marketing
strategy, Exclusive Values should more effectively concentrate
Montgomery Ward's advertising and in-store marketing thrust into
compelling messages.  Further, Exclusive Values are being used to
redeploy inventory investment from less productive merchandise to
core, high velocity items.  
<PAGE>
Item 1.  Business. (continued)

Performance Initiatives (continued)

  Actions have been initiated to reduce inventories in response to
slow industry-wide sales and identify opportunities to enhance
inventory turnover and earnings' productivity.  Aggressive
inventory receipt management has been undertaken using new
reporting systems.  The use of foreign sourcing is being decreased
to shorten commitments and increase response to volatile sales
trends.  The focus on Exclusive Values and narrower assortments
should improve inventory management by facilitating in-stock
position and higher turnover.

  Merchandising enhancements originally introduced in Electric Ave.
& More were integrated in 164 of the Electric Ave. formats in
Montgomery Ward's full line stores and contributed to favorable
electronics sales in fourth quarter 1995.  These enhancements
provide more dominant aisle exposure for Exclusive Values and
higher margin product.  They also present certain merchandise in a
self-service, take-with format which adds shopper convenience and
prompts impulse purchases.

  Two major brand additions in Fall 1995 should also benefit 1996
performance.  Auto Express introduced the Goodyear brand in third
quarter 1995.  Goodyear sales are growing to represent a
significant portion of the Company's tire volume, and the brand is
drawing new customers and generating added service opportunities. 
In addition, Whirlpool appliances were introduced in fourth quarter
1995 and have significant market share potential in that one out of
every four major appliance purchases by consumers is the Whirlpool
brand.  Management believes the Goodyear and Whirlpool additions
give Montgomery Ward's automotive and home oriented specialty
concepts the strongest brand offering among major competition.


Direct Marketing

  Montgomery Ward offers life and health insurance, revolving
credit insurance, club products and other consumer services through
the Signature Group.  As a recognized leader in sophisticated
segmentation scoring models, Signature is among the premier direct
marketers in the country.  During 1995, Signature made more than
400 million direct mail solicitations and 60 million telemarketing
presentations from its 18 telemarketing centers equipped with the
latest technology, including proprietary software.  At year-end
1995, Signature had 11.4 million policyholders and club
memberships, a 10% increase over year-end 1994.

  The Company believes that Signature has the broadest major
product offering among direct marketers.  Its legal services club
is the largest United States provider of voluntary legal services,
<PAGE>
Item 1.  Business. (continued)

Direct Marketing (continued)

it operates one of the largest national auto clubs in the country,
and it has a unique dental plan which offers discounted and free
dental services for a monthly fee.  Signature has developed a
substantial network of service providers to support these clubs. 
Its dispatch towing network for Auto Club members exceeds 7,600
towing companies with a fleet of over 30,000 tow trucks.  Its legal
plan network includes 2,600 attorneys with an average of thirteen
years experience and the dental plan includes 7,500 dentists with
an average of sixteen years experience.  

  Signature has marketing rights to the 8.3 million promotable
accounts in the Montgomery Ward credit card file, and the 1.8
million average new accounts added annually.  Signature has over 29
years of experience marketing to Montgomery Ward credit accounts
and has considerable expertise in maximizing its response rates. 
Montgomery Ward credit cardholders comprise the majority of
Signature's customers, and the size and customer dynamics of the
Montgomery Ward file have allowed Signature to attain economies of
scale which have lowered its marketing and operating costs.
Signature also markets its products and services to the customers
of more than 50 other entities, providing 42.9 million promotable
accounts, including some of the nation's largest financial
institutions, oil companies and retailers.  Signature's major
clients include Citibank, Chemical, Chase Manhattan, First National
Bank of Chicago, National Westminster, NorWest, First Fidelity,
Wachovia, Mobil, Texaco, Unocal, G.E. Consumer Financial Services,
Federated Allied Credit Services, Limited Retail Divisions, Brylane
Catalog Divisions, Best Buy, Hudson's Bay, Associates, USAA and
Credit Union National Association, and revenues from these clients
have grown to 36% of its revenues.

  Subsequent to year end, Signature acquired the Amoco Motor Club,
which provides year-round, 24-hour emergency road and towing
services to more than two million club members.  Combining the
Amoco Motor Club with Signature's auto club will create the largest
national auto club in the United States.  As discussed in Note 13
to the Consolidated Financial Statements, Montgomery Ward financed
this acquisition through the use of the majority of the proceeds
generated from the issuance of $175 million of a new series of
Senior Preferred Stock. 

  See Note 20 to the Consolidated Financial Statements for
restrictions on dividends which may be paid by insurance
subsidiaries of Signature.
<PAGE>
Item 1.  Business. (continued)

Competition and Regulation

  The sale of merchandise by Montgomery Ward and Lechmere is
conducted under highly competitive conditions.  Buying and selling
are each done in open competitive markets.  Montgomery Ward's
stores are in competition with specialty stores, department stores
and other types of retail outlets in the areas in which they
operate.  The Company believes that dominance of merchandise
assortments, brand names, competitive pricing and availability of
services such as credit, delivery, installation and repair, are the
principal factors which differentiate competitors.  The Company
believes it competes effectively with respect to all of these
factors despite strong competitive pressures.  To meet competition,
Montgomery Ward is continuously striving to improve the efficiency
and effectiveness of its operations and to modernize and specialize
its facilities.

  Signature's insurance operations are highly regulated and
conducted under highly competitive conditions.  To date, Signature
has been able to compete effectively with other companies which
offer programs similar to those provided by Signature.  Signature
also competes with traditional methods of marketing that enjoy
widespread consumer acceptance, including the marketing effort by
unaffiliated dentists and lawyers.  Insurance companies operate
pursuant to specific state statutes as well as rules and
regulations promulgated by various state insurance departments and
are required to file reports with such agencies at least quarterly.

  Telemarketing and direct mail solicitations are regulated at
state and federal levels, and management believes that these
activities will increasingly be subject to such regulation.  Such
regulation may limit Signature's ability to solicit new members or
to offer more products and services to existing members and may
materially adversely affect Signature's business and revenues.

  The requirements of environmental protection laws and regulations
have not had a material effect upon Montgomery Ward's operations. 
Compliance may, in certain cases, lengthen the lead time of
expansion plans and could increase construction and operating
costs.


Account Purchase Agreement 

  Montgomery Ward extends credit to its customers under an
open-ended revolving credit plan.  Montgomery Ward's private label
credit card sales were 54.2% and 55.9% of total sales for 1995 and
1994, respectively.  Bankcard sales were an additional 16.4% and
14.9% of total sales for 1995 and 1994, respectively.  
<PAGE>
Item 1. Business.  (continued)

Account Purchase Agreement (continued)

  Montgomery Ward and Montgomery Ward Credit Corporation
(Montgomery Ward Credit), a wholly-owned subsidiary of General
Electric Capital Corporation (GE Capital), operate under an Account
Purchase Agreement pursuant to which Montgomery Ward Credit
purchases receivables from time to time from, and provides services
to, Montgomery Ward.  Under this agreement, Montgomery Ward Credit
has the exclusive right to operate the Montgomery Ward private
label credit card system and the obligation to purchase for their
face value (and Montgomery Ward is obligated to sell) all the
receivables generated by the Montgomery Ward private label credit
card system, including those generated through Montgomery Ward's
50% owned specialty catalog partnership, Montgomery Ward Direct
L.P. (MW Direct), up to $6 billion outstanding at any time.  If
Montgomery Ward desires to sell its customer receivables at a time
when Montgomery Ward Credit owns $6 billion or more of such
receivables, alternative arrangements, such as the sale of
receivables to banks or other financial institutions, would be
required unless Montgomery Ward Credit agrees to purchase the
excess.  As of December 30, 1995, there were $5.3 billion of
Montgomery Ward private label credit card receivables owned by
Montgomery Ward Credit, and the average outstanding amount of such
receivables owned by Montgomery Ward Credit during 1995 was $5.1
billion. 

   Pursuant to the Account Purchase Agreement, Montgomery Ward
Credit bears certain credit promotion expenses, while Montgomery
Ward retains certain specified in-store service responsibilities 
with respect to credit operations.  Decisions regarding certain
credit matters are determined by a management committee with
representatives from each party.  Under the Account Purchase
Agreement, Montgomery Ward is required to pay Montgomery Ward
Credit the excess interest costs on a monthly basis if a blended
interest rate applicable to Montgomery Ward Credit's finance costs
with respect to the receivables exceeds 10% per annum.  As of 
December 30, 1995,  the blended interest rate has been less than
10%.

   Under the Account Purchase Agreement, Montgomery Ward and
Montgomery Ward Credit have made certain arrangements with respect
to credit losses.  Previously, credit losses were shared. 
Effective January 1, 1994, Montgomery Ward bears the entire risk of
credit losses until such time as Montgomery Ward or Montgomery Ward
Credit elects to revert to the prior loss sharing arrangement.  In
1992, the parties agreed that Montgomery Ward's remaining liability
for credit losses for 1991 through 1994, and its liability for
credit losses for 1995 through 1997, may be deferred, and such
deferred credit losses are payable by Montgomery Ward to Montgomery
Ward Credit in early 1998.  To the extent these deferred credit  
<PAGE>
Item 1.  Business.  (continued)

Account Purchase Agreement (continued)

losses, less the deferred amount of finance charges, which the
parties agreed effective January 1, 1994 was payable to Montgomery
Ward, (other than incremental finance charges and late fees
described below) exceed $300 million at any time, such excess is to
be paid annually in cash.  The Company does not expect such amounts
for the period through 1997 to exceed the $300 million limitation. 
Interest on Montgomery Ward's deferred liability for credit losses
is payable at a rate equal to rates on comparable borrowings of
Montgomery Ward.

  In exchange for Montgomery Ward's agreement to allow Montgomery
Ward Credit to increase finance charge rates in selected states,
Montgomery Ward receives a share of incremental finance charges.
In 1995, Montgomery Ward entered into an agreement with Montgomery
Ward Credit to increase late fee assessments and implement
previously agreed upon finance charge increases in various states,
as allowed by statute.  Montgomery Ward's share of these
incremental finance charges and late fees is calculated in the same
manner as the prior 1992 agreement.  These incremental finance
charges and late fees are deferred and payable by Montgomery Ward
Credit to Montgomery Ward in early 1998, together with interest at
the same rate as amounts owed by Montgomery Ward to Montgomery Ward
Credit.  Incremental finance charges are generated only on
purchases subsequent to the date such finance charge rates are
increased.  In the event that, due to the increase in finance
charge rates and late fees, certain refunds are required to be
made, Montgomery Ward and Montgomery Ward Credit have agreed to
share the financial risk.  In addition, legislation has from time
to time been introduced in certain states which, if enacted, may
impose limitations on the ability to implement or maintain all or
a portion of such rate increases, in which case Montgomery Ward's
share of rate increases may be substantially reduced.

  In addition to sharing incremental finance charges, beginning
in 1994, and late fees, beginning in 1995, until such time as
Montgomery Ward or Montgomery Ward Credit elects to revert to the
prior loss sharing arrangements, with respect to each fiscal year,
Montgomery Ward Credit will make a payment (subject to the deferral
for 1994 through 1997) to Montgomery Ward of a share of all finance
charges in an amount equal to (a) if credit losses are 5% or less
of average gross receivables, the lesser of 3.9% of average gross
receivables or the actual credit losses; (b) if credit losses are
greater than 5% but less than or equal to 8% of average gross
receivables, 3.9% of average gross receivables plus 50% of the
amount by which actual credit losses exceed 5% of average gross
receivables; or (c) if credit losses exceed 8% of average gross
receivables, 5.4% of average gross receivables plus the amount by
which credit losses exceed 8% of average gross receivables.  
<PAGE>
Item 1.  Business.  (continued)

Account Purchase Agreement (continued)

Notwithstanding the foregoing, in certain circumstances the amounts
payable to Montgomery Ward by Montgomery Ward Credit with respect
to its share of all finance charges are limited as follows:  in the
event that total finance charges billed by Montgomery Ward Credit
during a fiscal year less Montgomery Ward's share of the
incremental finance charges are less than the amount which would
otherwise be payable to Montgomery Ward by Montgomery Ward Credit
as it's share of the finance charges as computed above, the
payments by Montgomery Ward Credit to Montgomery Ward will be
reduced to the amount of such total finance charges less such
incremental finance charges.

  In connection with the foregoing arrangements, the Company has
executed notes for the deferred credit losses which totalled $224
million with respect to credit losses from 1991 through 1995.  The
incremental finance charge amount owed by Montgomery Ward Credit to
Montgomery Ward as of the end of 1995 was $44 million.  See Note 4
to the Consolidated Financial Statements.

   Montgomery Ward Credit has the right of first refusal to
implement certain new financing programs proposed by Montgomery
Ward.

  The Account Purchase Agreement will be in effect until December
31, 2006 and thereafter from year to year unless either party gives
to the other not less than ten years prior notice of its election
to terminate.  Except upon the occurrence of certain events of
default, the Account Purchase Agreement may generally not be
terminated by either party prior to December 31, 2006.  GE Capital
has guaranteed Montgomery Ward Credit's obligations under the
Account Purchase Agreement. 

 Montgomery Ward Credit purchases the customer accounts receivable
of Signature on terms similar to those contained in the Account
Purchase Agreement, except for certain fees.  In 1995, Signature
paid approximately $6 million to Montgomery Ward Credit for
administrative services provided by Montgomery Ward Credit in
connection with Signature products.
<PAGE>
Item 1.  Business.  (continued)

Associates

  At December 30, 1995, Montgomery Ward and its subsidiaries
employed the equivalent of 55,000 full-time associates.  During 
certain seasons, temporary associates are added and peak employment
is approximately 71,000 associates during the Christmas season. 
Approximately 2,400 Montgomery Ward and Lechmere associates are
covered by various collective bargaining agreements.  The majority
of the agreements expire in 1997.  Montgomery Ward has experienced
no major labor-related interruption or curtailment of operations
during the last 15 years.  The Company considers its labor
relations to be good.



Item 2. Properties.

  At December 30, 1995, the Company owned or leased 518 retail,
distribution and other operating facilities.  The Company's
properties are located throughout the continental United States and
cover approximately 60 million square feet.

  These properties are summarized as follows:

                               Number of   Approximate
          Use                  Locations Total Square Feet

    Montgomery Ward
    Retail Stores:
       Full Line . . . . . . . . .340          44,060,000
       Limited Line. . . . . . .   34           2,051,000
    Lechmere Retail
       Stores. . . . . . . . . .   28           2,468,000
    Corporate Office
       Complex . . . . . . . . . .  1           2,975,000
    Miscellaneous Operating
       Locations . . . . . . . . .115           8,573,000
          Total Locations. . . . .518          60,127,000

  Owned and leased retail stores include approximately 29 million
square feet of selling space and 19 million square feet devoted to
storage, office and related uses.  Miscellaneous operating
locations include warehouses, office buildings and distribution
centers, but exclude vacant land parcels and properties held for
disposition.  See Note 12 to the Consolidated Financial Statements
for information with respect to leased properties.
<PAGE>
Item 2.  Properties.  (continued)

  The nationwide scope of Montgomery Ward's operations helps
minimize the impact of changes in the economies of specific regions
on the overall performance of its retail stores and allows
Montgomery Ward to merchandise to a variety of demographic
profiles.  The regional distribution of Montgomery Ward and
Lechmere retail stores as of December 30, 1995 is indicated in the
following table:

        State                                    Total

        Alabama                                     3
        Arizona                                    11
        Arkansas                                    5
        California                                 57
        Colorado                                   13
        Connecticut                                 4
        Florida                                    23
        Georgia                                     3
        Idaho                                       1
        Illinois                                   32
        Indiana                                     9
        Iowa                                        6
        Kansas                                      6
        Kentucky                                    2
        Louisiana                                   6
        Maine                                       1
        Maryland                                   16
        Massachusetts                              13
        Michigan                                   16
        Minnesota                                  10
        Missouri                                   10
        Montana                                     2
        Nebraska                                    2
        Nevada                                      3
        New Hampshire                               6
        New Mexico                                  3
        New York                                   18
        North Carolina                              4
        North Dakota                                1
        Ohio                                        5
        Oklahoma                                    5
        Oregon                                      8
        Pennsylvania                               14
        Rhode Island                                1
        South Carolina                              5
        Tennessee                                   2
        Texas                                      45
        Vermont                                     1
        Virginia                                   17
        Washington                                  3
        West Virginia                               5
        Wisconsin                                   4
        Wyoming                                     1
                                                  402
<PAGE>
Item 3.  Legal Proceedings.

         The Company and its subsidiaries are engaged in various
litigation and have a number of unresolved claims.  While the
amounts claimed are substantial and the ultimate liability with
respect to such litigation and claims cannot be determined at this
time, management is of the opinion that such liability, to the
extent not provided for through insurance or otherwise, is not
likely to have a material impact on the financial condition or the
results of operations of the Company.

         In 1979, a suit entitled "United States v. Midwest Solvent
Recovery, Inc., et.al." (Civil Action Number H-79-556) was
initiated by the United States Department of Justice on behalf of
the Environmental Protection Agency in the U.S. District Court for
the Northern District of Indiana, and an Amended Complaint was
filed in January 1984.  This suit is against Standard T Chemical
Company, Inc., a Delaware corporation and wholly-owned subsidiary
of Montgomery Ward (Standard T), which ceased operations in 1994
and is currently an inactive entity, and others involving two waste
disposal sites and seeks reimbursement for the cost of surface
clean-up, investigation studies concerning possible contamination
of the soil and ground water and remedial action.  In January 1990,
the United States filed a second Amended Complaint seeking inter
alia, treble damages and monetary sanctions.  Standard T signed a
consent decree, whereby it was obligated to provide a financial
assurance up to $3 million for remediation of the site.  The
Company currently anticipates that its obligation will not exceed
that amount.

         In 1985, the New York Environmental Protection Agency brought an
action for remediation of a site in Staten Island, New York against
the owner of the property.  The owner asserted that Standard T,
among others, generated wastes that were disposed of by a prior
owner of the site.  Standard T is in the process of completing the
cleanup of this site and has purchased the site from the owner for
$1.45 million. 

         In February 1986, Standard T, along with approximately 330 other
companies, was notified by the United States Environmental
Protection Agency that the agency was mandating a remediation of
the contamination of the American Chemical Services, Inc. (A.C.S.)
site located in Griffith, Indiana, under authority vested in it by
the Comprehensive Environmental Response, Compensation and
Liability Act of 1980.  Standard T and a Montgomery Ward paint
factory were each identified as a Potentially Responsible Party
(PRP), under the terms of the Act, because of their alleged status
as generators of hazardous waste ultimately disposed of at the
A.C.S. site.  The Company will pay its proportionate share of the
<PAGE>
Item 3.  Legal Proceedings. (continued)

costs of the studies, and may ultimately pay a share of the costs
of abating the contamination of the A.C.S. site.  One estimate by
the EPA of future costs is $69 million with the Company alleged to
be responsible for 2 to 2 1/2% of total costs.  However, these
costs cannot be estimated with any degree of accuracy at this time. 
Thus, the Company is currently not in a position to estimate the
range or amount of potential exposure in this matter with a high
degree of certainty.

         On or about December 10, 1990, the Company was served with a
Complaint and Notice of Opportunity for Hearing (Complaint),
alleging certain violations by the Company of the Federal Toxic
Substances Control Act (TSCA).  The Complaint contains twenty-two
counts and alleges that the Company violated various regulations
concerning the use, disposal, storage and marking of
polychlorinated biphenyls (PCBs) at a warehouse facility located in
Kansas City, Missouri.  The matter has been settled with a nominal
civil penalty and the Company agreeing to remove certain CFC-
containing chillers from certain stores in the Kansas City area. 

         Standard T and Montgomery Ward are also involved at various
stages with several other sites where Standard T and Montgomery
Ward have been notified or sued as a PRP.  The potential liability
related to these sites cannot be estimated at this time.


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

         None.


                   EXECUTIVE OFFICERS OF THE REGISTRANT

         Listed below are the names and ages of the executive officers of
the Company as of March 20, 1996, and the positions each has held
during the past five years:

         Bernard  F.  Brennan, 57, has  been  Chief  Executive  Officer 
and a director of the Company since February 9, 1988, Chairman
since June 17, 1988 and was President from February 9, 1988 through
September 10, 1992.  Mr. Brennan has been Chief Executive Officer
and a director of Montgomery Ward since May 13, 1985 and became
Chairman of Montgomery Ward on June 24, 1988.  He served as
President of Montgomery Ward from May 13, 1985 through September
10, 1992.  Mr. Brennan has been a director of Itel Corporation
since 1988.
<PAGE>
Executive Officers of the Registrant (continued) 

         Spencer H. Heine, 53, has been an Executive Vice President,
Secretary and General Counsel of the Company since September 30,
1991 and a director since May 15, 1992.  Prior thereto, he was
Senior Vice President, Secretary and General Counsel of the Company
from June 17, 1988 through September 29, 1991.  Mr. Heine has been
Executive Vice President, Secretary and General Counsel of
Montgomery Ward and President-Montgomery Ward Properties since
April 12, 1994.  Prior thereto, Mr. Heine served as Executive Vice
President, Legal and Financial Services of Montgomery Ward from
September 30, 1991 through April 11, 1994.   He served as Senior
Vice President-Legal and Real Estate from March 28, 1990  through
September 29, 1991.  Mr. Heine was Chairman and Chief Executive
Officer of Signature from March 8, 1993 through April 11, 1994. 
Prior thereto, he also served as President of Signature since
September 30, 1991.

         Robert A. Kasenter, 49, has been an Executive Vice President of
the Company since February 21, 1992.  Prior thereto, he was a
Senior Vice President of the Company from June 17, 1988 through
February 20, 1992.  Mr. Kasenter has served as Executive Vice
President, Human Resources of Montgomery Ward since January 27,
1992 and was Senior Vice President-Human Resources and Customer
Satisfaction from June 23, 1988 to January 26, 1992.

         Edwin G. Pohlmann, 48, has been an Executive Vice President since
September 30, 1991 and served as Chief Financial Officer of the
Company from September 30, 1991 to August 30, 1992.  Prior thereto,
he was Senior Vice President and Chief Accounting Officer from May
18, 1990 to September 29, 1991.  Mr. Pohlmann has been Executive
Vice President, Merchandise and Store Operations of Montgomery Ward
since November 16, 1993.  Prior thereto, he was Executive Vice
President, Merchandise Control from June 25, 1993 through November
15, 1993, Executive Vice President, Stores and Finance of
Montgomery Ward from January 27, 1992 to June 24, 1993 and prior
thereto, Executive Vice President and Chief Financial Officer since
September 30, 1991.  He served as Senior Vice President-Store
Operations of Montgomery Ward from June 16, 1991 through September
29, 1991 and was Senior Vice President-Finance of Montgomery Ward
from March 1, 1988 through June 15, 1991.

         John L. Workman, 44, has been Executive Vice President, Chief
Financial Officer and Assistant Secretary of the Company since
January 28, 1994 and a director since May 12, 1995.  Prior thereto,
he served as Senior Vice President, Chief Financial Officer and
Assistant Secretary from August 31, 1992 through January 27, 1994
and Vice President and Assistant Secretary from May 15, 1992
through August 30, 1992.  Mr. Workman has been Executive Vice 
President and Chief Financial Officer of Montgomery Ward since
January 28, 1994 and served as Senior Vice President and Chief 
<PAGE>
Executive Officers of the Registrant (continued) 

Financial Officer from August 31, 1992 to January 27, 1994.  Prior
thereto, he served as Vice President and Corporate Controller from
January 16, 1991 through August 30, 1992 and Corporate Controller
from August 2, 1988 through January 15, 1991.  Mr. Workman has been
a director of ValueVison International, Inc. since August 8, 1995.

         Richard C. Rusthoven, 54, served as an Executive Vice President
of the Company from May 15, 1992 until his current leave of absence
which began on November 1, 1992.  Mr. Rusthoven was Executive Vice
President-Apparel of Montgomery Ward from February 20, 1992 through
October 31, 1992 and was Senior Vice President-Apparel from July 3,
1991 to February 19, 1992.  He served as Vice President and General
Merchandise Manager, Men's Apparel, Footwear and Accessories from
June 6, 1990 to July 2, 1991.  Mr. Rusthoven is also on a leave of
absence from Montgomery Ward.

         Carol J. Harms, 42, has been Vice President and Treasurer of the
Company since January 1, 1989.  Ms. Harms has been Vice President
and Treasurer of Montgomery Ward since May 1, 1988. 

         G. Joseph Reddington, 54, has been a director of the Company and
of Montgomery Ward since September 22, 1994.  Mr. Reddington has
been Chairman and Chief Executive Officer of Signature since April
12, 1994.  Prior thereto, he was President of Sears Canada, Inc.
from 1989 until his retirement in December 1993.  Mr. Reddington
has been a director of TransWorld Airlines since August 1993 and a
director of Loblaw Companies Ltd. since August 1994. 

         Robert J. Stevenish, 52, has been Executive Vice President,
Operations of Montgomery Ward since November 1, 1995.  Prior
thereto, he was with Hills Department Stores, Inc. from October,
1992 where his most recent position was Senior Executive Vice
President and Chief Operating Officer.  Prior to joining Hills
Department Stores, Mr. Stevenish worked for J.C. Penney Company for
25 years in positions of increasing responsibility.

         Frederick E. Meiser, 52, has been Chairman and Chief Executive
Officer of Lechmere since November 30, 1995.  Prior to joining
Lechmere, Mr. Meiser was Executive Vice President, Merchandising
and Marketing of Builders Square.   Prior thereto, he was Vice
President Marketing and Importing for SPS Industries.

         Alan E. DiGangi, 49, has been Executive Vice President, Electric
Ave., Rooms & More/Soft Home of Montgomery Ward since January 5,
1996.  Prior thereto, he was Executive Vice President, Electric
Ave. & More from April, 1995 to January, 1996.  Mr. DiGangi joined
Montgomery Ward in April, 1970 and has held various positions
within Store Management, Field Operations, Marketing and Sales
Promotion.  
<PAGE>
                                  PART II

Item 5. Market for the Registrant's Common Equity and Related
        Stockholder Matters.

  There is no established public trading market for the Common
Stock of the Company.  All shares are subject to restrictions on
transfers contained in the Stockholders' Agreement dated as of June
17, 1988, as amended and restated (Stockholders' Agreement), or the
Terms and Conditions (Terms and Conditions) imposed under the
Montgomery Ward & Co., Incorporated Stock Ownership Plan (Stock
Ownership Plan).  It is not expected that a market will develop in
the near term.

  Transfers of shares of Class A Common Stock are restricted for
a period of three years from certain applicable dates under the
Stockholders' Agreement and the Terms and Conditions.  Transfers of
Class A shares purchased other than pursuant to the Stock Ownership
Plan are restricted for a period of three years from the holder's
first acquisition of any such shares, while transfers of shares
received under the Stock Ownership Plan are restricted for a period
of three years after the award of such shares, exercise of purchase
rights for such shares or grant of options with respect to such
shares, as applicable.  After the applicable three-year periods,
limited transfers of such shares which have become vested in
accordance with the Stockholders' Agreement or the Terms and
Conditions, as applicable, are permitted, subject to certain rights
of first refusal.  All of the Class B shares and virtually all of
the outstanding Class A shares are eligible for transfer. 

  Montgomery Ward declared and paid preferred stock dividends of
$4 million to the Company in 1995, which declared and paid
preferred stock dividends of $4 million in 1995.  For information
concerning limitations on the amount of dividends which Montgomery
Ward may pay, see Note 11 to the Consolidated Financial Statements. 
Future payments of dividends, if any, are dependent upon future
levels of earnings and capitalization.

  As of March 20, 1996, there were three holders of record of Class
A Common Stock, Series 1, one such holder of Class A, Common Stock,
Series 2, and one such holder of Class B Common Stock.  No shares
of Class A Common Stock, Series 3, were outstanding as of that
date.  As of March 20, 1996, there were 109 holders of record of
Voting Trust Certificates representing beneficial ownership in
shares of Class A Common Stock, Series 1, of which 711,774 shares
are pledged as collateral for notes issued to effect the repurchase
of shares.  See Note 14 to the Consolidated Financial Statements. 
There were 248 holders of record of Voting Trust Certificates
representing beneficial ownership in shares of Class A Common
Stock, Series 2.
<PAGE>
Item 6. Selected Financial Data

  The following summary of certain financial information for each
of the five fiscal years in the period ended December 30, 1995 has
been derived from the Consolidated Financial Statements of MW
Holding.  Such information for each fiscal year should be read in
conjunction with the Consolidated Financial Statements and notes
thereto and the report of Arthur Andersen LLP beginning on page 29.

                             As of and for the   
         52-Week      53-Week            52-Week
       Period Ended   Period Ended       Period Ended                    
         Dec. 28,       Jan. 2,     Jan. 1,   Dec. 31,   Dec. 30,  
           1991         1993          1994      1994       1995
                   (Dollars in millions, except per share amounts)
Total
Revenues  $5,673        $5,803      $6,023    $7,029     $7,085

Net Income
(a)          135           100         101       117         11

Net Income
Applicable
to Common
Share-
holders(a)   122            92         101       115          7
 
Net Income
per Class A
Common
Share (a)   2.40          2.01        2.29      2.68        .16

Total
Assets     3,948         3,485       3,835     4,537      4,884

Long-Term
Debt         521           125         213       228        423

Obligations
Under
Capital
Leases       104            95          89        81         66

Total Share-
holders'
Equity       520           553         607       687        700

Redeemable
Preferred
Stock         90             -           -        75        175

Cash Divi-
dends per
Common
Share          -           .25         .50       .50          -

 (a) 1992 amounts are presented before cumulative effect of
     changes in accounting principles of $40 as a result of
     adoption of Financial Accounting Standards Board Statements
     No. 106, "Employees Accounting for Postretirement Benefits Other Than
     Pensions" and No. 109 "Accounting for Income Taxes".
<PAGE>
Item 7.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations.

  The following discussion and analysis of results of operations
for the Company compares 1995 to 1994, as well as 1994 to 1993. 
Montgomery Ward is on a 52- or 53- week fiscal year basis.  As a
result, 1995, 1994 and 1993 are 52-week years.  All dollar amounts
are in millions, and all income and expense items and gains and
losses are shown before income taxes, unless specifically stated
otherwise.

  The Company's retail business is seasonal, with more than 30% of
the 1995 sales occurring in the fourth quarter.


Results of Operations:  1995 Compared with 1994

  Increasingly difficult industry conditions further challenged
retailers' ability to provide profitable, value-driven products,
appropriate assortment and maintain disciplined inventories.  The
Company's performance reflected this with consolidated net income
decreasing $106, or 90%, from the prior year.  Consolidated net
income applicable to common shareholders for 1995 was $7, which was
94% less than the prior year.  Net income for 1995 includes the
first quarter loss from operations of Lechmere.  Lechmere was
acquired on March 30, 1994, therefore, 1994 results exclude
Lechmere's first quarter 1994 results.  Given the seasonality of
Lechmere's business, it has historically experienced losses in the
first quarter of the year. 

  Consolidated total revenues (net sales and direct response
marketing revenues, including insurance) were $7,085 compared with
$7,029 in 1994, increasing by $56 million or 1%.  The $56 million
total revenue increase consisted of a $33 million decrease in net
sales and an $89 million increase in direct marketing revenues. 
The change in total net sales represented a 1% decline, however,
excluding Lechmere's first quarter 1995 impact of $192, as
described above, net sales decreased $225, or 3%.  Apparel and
domestics sales declined 6% and included the negative impact of
exiting the sale of paint and paint supplies.  Hardlines sales
decreased by 2%.  Sales on a comparable store basis, which reflect
only the stores in operation for both 1995 and 1994, decreased 5%. 
Montgomery Ward did experience favorable results in fourth quarter
1995 in the performance of "Exclusive Values" which leverage the
Company's alliances with large vendors to offer branded, highly
featured product that produces extraordinary sales volume at
attractive margin rates.  The increase in direct response marketing
revenues was primarily due to increased clubs' membership and
insurance policyholder levels.
<PAGE>
Item 7.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations. (continued)

Results of Operations:  1995 Compared with 1994 (continued)

  Gross margin (net sales less cost of goods sold) dollars,
including Lechmere, were $1,353, a decrease of $118, or 8%, from
1994.  This decrease was due to the gross margin impact of the
decreased sales of $10, a decrease in the margin rate on sales of
$99, and increased occupancy costs of $29 related to increased
depreciation on capital investments in new and existing stores,
partially offset by decreased buying and other expenses of $20. 
The 1995 gross margin rate reflects the gross margin results for
Lechmere for twelve months while the 1994 rate reflects Lechmere's
results for only nine months.  While Lechmere added to gross margin
dollars, its emphasis in appliances and electronics, which tend to
have lower gross margin rates, contributed to the decrease in the
1995 gross margin rate.  Continued competitive pressures also had
an impact on margin rates, and Montgomery Ward's margin trends are
consistent with overall industry results.

  Operating, selling, general and administrative expenses increased
$107, or 6%, from the prior year.  Excluding Lechmere's 1995 first
quarter impact, operating, selling, general and administrative
expenses increased by $73, or 4%.  The increase includes the impact
of new store openings of $39, a provision for severance costs and
relocation of certain administrative functions of both Montgomery
Ward and Lechmere of $25 (See Note 16 to the Consolidated Financial
Statements), increased provision for bad debt expense under the
Account Purchase Agreement of $21, increased advertising and other
promotional costs of $17 and increased operating and administrative
expenses of $8, partially offset by increased income generated from
the sale of product service contracts of $37 (See Note 9 to the
Consolidated Financial Statements).
  
  Net interest expense increased $33, or 57%, from the prior year. 
The increase is due to increased borrowings resulting from a
combination of costs associated with the acquisition of, and added
investment in, Lechmere, higher average working capital levels from
slower than anticipated sales and capital expenditures for new and
existing stores, as well as increased interest rates in 1995. 

  Income tax benefit was $1 for 1995 as compared to income tax
expense of $62 for 1994.  See Note 8 to the Consolidated Financial
Statements.
<PAGE>
Item 7.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations. (continued)

Results of Operations:  1994 Compared with 1993

  Consolidated net income increased $16, or 16%, from the prior
year.  Consolidated net income applicable to common shareholders
for 1994 was $115, which was 14% greater than the prior year.

  Consolidated total revenues (net sales and direct response
marketing revenues, including insurance) were $7,029 compared with
$6,023 in 1993.  Net sales increased $941, or 17%.  Sales on a
comparable store basis, which reflects only the stores in operation
for both 1994 and 1993, increased 3%.  Non-comparable sales include
Lechmere sales of $694.  Lechmere was acquired on March 30, 1994. 
Non-comparable sales also include the sales of six "Electric Ave.
& More" stores opened during 1994.  This new specialty power format
combines the appliances/electronics (Electric Ave.), furniture
(Rooms & More) and fine jewelry (Gold 'N Gems) specialty formats. 
The stores have a broad assortment of home oriented merchandise and
contain Montgomery Ward's and Lechmere's most successful
merchandise categories in a format designed for mid-sized markets.

  Direct response marketing revenues increased $65, or 16%, to
$465.  The increase was primarily due to increased clubs'
membership and insurance policyholder levels.      

  Gross margin (net sales less cost of goods sold) dollars,
including Lechmere, were $1,471, an increase of $106, or 8%, from
1993.  This increase was due to the gross margin impact of the
increased sales of $272, partially offset by the decrease in the
margin rate on sales of $107, increased occupancy costs of $45
related to new store openings and increased buying and other
expenses of $14.  The decrease in the margin rate was impacted by
a heavier emphasis in appliances and electronics and the lower
margin rates that accompany these businesses (which includes
Lechmere) and continued competitive pressures.

  Operating, selling, general and administrative expenses increased
$137 or 9%, from the prior year.  Excluding Lechmere's expenses,
operating, selling, general and administrative expenses increased
by $35.  The increase was due to the impact of new store openings
of $48 and increased benefits and losses of direct response
operations of $9, partially offset by increased income generated
from the sale of product service contracts of $18 (See Note 9 to
the Consolidated Financial Statements) and decreased other
operating and administrative costs of $4.
<PAGE>
Item 7.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations. (continued)

Results of Operations:  1994 Compared with 1993 (continued)

  Net interest expense increased $15, or 35%, from the prior year. 
The increase is due to a combination of increased borrowings,
primarily due to the acquisition of Lechmere, as well as increased
rates in 1994.

  Income tax expense was $62, or 34% of income before income taxes,
for 1994 as compared to $59, or 37% of income before income taxes,
for 1993.  The decrease in the effective income tax rate was caused
by an income tax adjustment due to the settlement of issues with
the Internal Revenue Service for the 1988 through 1990 tax years.
  

Discussion of Financial Condition

  Montgomery Ward is the only direct subsidiary of MW Holding and
therefore Montgomery Ward and its subsidiaries are MW Holding's
sole source of funds.  

  Montgomery Ward has entered into a Long Term Credit Agreement
(Long Term Agreement) dated as of September 15, 1994 with various
lenders.  The Long Term Agreement, which was extended during 1995
and currently expires September 6, 2000, provides for a revolving
facility in the principal amount of $603.  As of December 30, 1995,
no borrowings were outstanding under the Long Term Agreement. 
Concurrently, Montgomery Ward also entered into a Short Term Credit
Agreement (Short Term Agreement) dated as of September 15, 1994
with various lenders.  The Short Term Agreement, which was extended
during 1995 and currently expires September 6, 1996, provides for
a revolving facility in the principal amount of $297.  As of
December 30, 1995, $160 was outstanding under the Short Term
Agreement.

  Under the Long Term Agreement and the Short Term Agreement
(collectively, the Agreements), Montgomery Ward may select among
several interest rate options, including a rate negotiated with one
or more of the various lenders.  The interest rates for the
aforementioned bank borrowings are based on market rates, and
significant increases in market interest rates will increase
interest payments required.  A commitment fee is payable based upon
the unused amount of each facility, and under certain
circumstances, an additional fee may be payable to lenders not
participating in a negotiated rate loan.
<PAGE>
Item 7.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations. (continued)

Discussion of Financial Condition (continued)

  Montgomery Ward has entered into interest rate exchange and cap
agreements with various banks to offset the market risk associated
with an increase in interest rates under both the Long Term
Agreement and the Short Term Agreement.  The aggregate notional
principal amounts under the interest rate exchange agreements are
$175 in 1995 through 1997 and $75 in 1998 and 1999.  Under the
terms of the interest rate exchange agreements, Montgomery Ward
pays the banks a weighted average fixed rate of 7.4% from 1995
through 1997 and 7.6% from 1998 through 1999 and will receive the
one-month daily average London Inter-bank Offered (LIBO) rate in
each case multiplied by the notional principal amount.  The average
aggregate notional principal amounts under the various cap
agreements are $154 in 1995, $158 in 1996 and $113 in 1997.  Under
the terms of the cap agreements, Montgomery Ward receives payments
from the banks when the one-month daily average LIBO rate exceeds
the 5.5% cap strike rate in 1995, 6% cap strike rate in 1996 and
7.0% cap strike rate in 1997.  Such payments will equal the amount
determined by multiplying the notional principal amount by the
excess of the percentage rate, if any, of the one-month daily
average LIBO rate over the cap strike rate.  

  On July 11, 1995, Montgomery Ward entered into a Note Purchase
Agreement (1995 Note Purchase Agreement) with various lenders
involving the private placement of $180 of Senior Notes which have
maturities of from five to ten years at fixed interest rates
varying from 6.52% to 6.98%.  Proceeds from the debt issue were
used to repay short-term borrowings incurred to fund the Company's
acquisition of Lechmere.  See Note 11 to the Consolidated Financial
Statements.

  On September 29, 1995, Montgomery Ward borrowed $25 under a Term
Loan Agreement (Term Loan Agreement) with a bank.  The borrowings
mature on September 30, 1999.  Under the Term Loan Agreement,
Montgomery Ward may select several interest rate options which are
based on market rates.  See Note 11 to the Consolidated Financial
Statements.  

  The Agreements, the Term Loan Agreement, the 1993 Note Purchase
Agreements, and the 1995 Note Purchase Agreement impose various
restrictions on Montgomery Ward, including the satisfaction of
certain financial tests which include restrictions on payments of
dividends.  Under the terms of the Agreements and the Term Loan
Agreement, which are currently the most restrictive of the
financing agreements as to dividends, distributions and
redemptions, Montgomery Ward may not pay dividends or make any
<PAGE>
Item 7.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations. (continued)

Discussion of Financial Condition (continued)

other distributions to the Company or redeem any common stock in
excess of (1) $63 on a cumulative basis, plus (2) 50% of
Consolidated Net Income of Montgomery Ward (as defined in the
Agreements) after January 1, 1994, plus (3) any repayment by the
Company of any loan or advance made by Montgomery Ward to the
Company which was received after January 1, 1994, plus (4) capital
contributions received by Montgomery Ward after January 1, 1994,
plus (5) net proceeds received by Montgomery Ward from (a) the
issuance of capital stock including treasury stock but excluding
Debt-Like Preferred Stock (as defined in the Agreements), or (b)
any indebtedness which is converted into shares of capital stock
other than Debt-Like Preferred Stock of Montgomery Ward or the
Company, after January 1, 1994, plus (6) an adjustment of $45 for
1994 through 1996, $30 in 1997 and $15 in 1998.  At December 30,
1995, Montgomery Ward could pay dividends and make other
distributions to the Company of $108 pursuant to the terms of the
Agreements.  To date, Montgomery Ward has been in compliance with
all such financial tests. 

  On April 27, 1994, the Company issued 750 shares of a new series
of Senior Preferred Stock (Senior Preferred Stock) to GE Capital in
exchange for $75 in cash.  The Company used the proceeds to acquire
750 shares of a new issue of Senior Preferred Stock of Montgomery
Ward (Montgomery Ward Preferred) for $75 and Montgomery Ward used
the proceeds to reduce short-term borrowings.  On December 29,
1995, Montgomery Ward redeemed the Montgomery Ward Preferred held
by the Company for $75.  The Company used the proceeds to redeem
the Senior Preferred Stock held by GE Capital for $75.  The source
of funds for these transactions was borrowings under the
Agreements.  See Note 13 to the Consolidated Financial Statements.

  On December 29, 1995, Montgomery Ward issued 1,750 shares of a
new series of senior preferred stock (MW Senior Preferred Stock),
to GE Capital in exchange for $175 in cash.  Subsequent to year
end, Montgomery Ward used a portion of the proceeds to finance the
purchase of the Amoco Motor Club by its wholly-owned subsidiary,
Signature.  The MW Senior Preferred Stock constitutes Debt-Like
Preferred Stock under the Agreements and the Term Loan Agreement. 
The subscription agreement for the 1995 Senior Preferred Stock
contains an exchange option which gives GE Capital the option to
exchange the MW Senior Preferred Stock for senior preferred stock
of the Company with identical terms.  On January 31, 1996, GE
Capital exercised the exchange option.  See Note 13 to the
Consolidated Financial Statements.
<PAGE>
Item 7.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations. (continued)

Discussion of Financial Condition (continued)

  The Company has repurchased 5,632,147 shares held by certain
former officers of the Company, Montgomery Ward and Signature and
their permitted transferees by making cash payments and issuing
installment notes in the aggregate of approximately $47.  As of
December 30, 1995, the outstanding balance of these notes was $14.
See Note 14 to the Consolidated Financial Statements.  These
installment notes bear interest at varying rates, are payable over
multi-year periods (generally three to five years) and are secured
by shares of Common Stock, the fair market value of which is equal
to the outstanding principal amount under each note.  Under the
Agreements, Montgomery Ward expects to be able to advance the
Company sufficient funds to allow the Company to make the required
installment payments in 1996.

  Currently available external sources of funds include $900 in
multi-year revolving loan commitments under the Agreements which
were obtained in September 1994 of which $297 will expire on
September 6, 1996 and $603 will expire on September 6, 2000. 
During 1995, the average daily balance of borrowings under these
commitments was $623.

  Under the laws and regulations applicable to insurance companies,
some subsidiaries of Signature are limited in the amount of
dividends they may pay.  For information concerning limitations on
the amount of dividends Signature may pay, see Note 20 to the
Consolidated Financial Statements.  During 1994, Signature paid
dividends to Montgomery Ward aggregating $22.  Signature did not
pay dividends to Montgomery Ward in 1995.

  Future cash needs are expected to be satisfied by ongoing
operations, the sale of customer receivables to Montgomery Ward
Credit, borrowings under the Agreements, and the disposition of
capital assets related to facility closings.  See "Business -
Account Purchase Agreement" for a discussion of the terms of the
sales of customer receivables by Montgomery Ward to Montgomery Ward
Credit.
<PAGE>
Item 7.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations. (continued)

Discussion of Financial Condition (continued)

  Montgomery Ward and Lechmere's capital expenditures of $122 for
1995 were primarily related to opening 5 new Electric Ave. & More
stores and relocating 3 full line stores and implementing
conversion strategies in conventional retail stores and various
merchandise fixture and presentation programs.  Montgomery Ward
regularly reviews opportunities for acquisitions and joint ventures
and regards such transactions as a possible source for future
growth.
                                  1995      1994      1993

  Total Capital Expenditures . . .$ 122    $ 184      $ 142

  Capital appropriations
    authorized during the year . .$ 152    $ 247      $ 149

  Cancellations of prior
    year's appropriations. . . . .$(75)    $(25)      $(23)

  Unexpended capital
    appropriations at year-end . .$ 136    $ 181      $ 143


  Montgomery Ward and Lechmere are not contractually committed to
spend all of the capital appropriations unexpended at December 30,
1995, but generally expect to do so. 


Item 8.  Financial Statements.
                                            Page
  Report of Independent Public
   Accountants . . . . . . . . . . . . . . . 29
  Consolidated Balance Sheet at 
   December 30, 1995 and
   December 31, 1994 . . . . . . . . . . . . 31
  For the 52-Week Periods Ended
   December 30, 1995,
   December 31, 1994 and January 1,
   1994
    Consolidated Statement of
     Income. . . . . . . . . . . . . . . . . 30
    Consolidated Statement of
     Shareholders' Equity. . . . . . . . . . 32
    Consolidated Statement of
     Cash Flows. . . . . . . . . . . . . . . 35
  Notes to Consolidated Financial
   Statements. . . . . . . . . . . . . . . . 37
<PAGE>
                 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To the Board of Directors and Shareholders
 of Montgomery Ward Holding Corp.:

 We have audited the accompanying consolidated balance sheets of
MONTGOMERY WARD HOLDING CORP. (a Delaware Corporation) AND
SUBSIDIARY as of December 30, 1995 and December 31, 1994, and the
related consolidated statements of income, shareholders' equity and
cash flows for the fiscal years ended December 30, 1995, December
31, 1994 and January 1, 1994.  These consolidated financial
statements are the responsibility of the Company's management.  Our
responsibility is to express an opinion on these consolidated
financial statements based on our audits.

 We conducted our audits in accordance with generally accepted
auditing standards.  Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
consolidated financial statements are free of material
misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated
financial statements.  An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall consolidated
financial statement presentation.  We believe that our audits
provide a reasonable basis for our opinion.

 In our opinion, the consolidated financial statements referred to
above present fairly, in all material respects, the financial
position of Montgomery Ward Holding Corp. and Subsidiary as of
December 30, 1995 and December 31, 1994 and the results of their
operations and their cash flows for the fiscal years ended December
30, 1995, December 31, 1994 and January 1, 1994, in conformity with
generally accepted accounting principles. 




     

                             Arthur Andersen LLP







Chicago, Illinois,
February 13, 1996
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
                     CONSOLIDATED STATEMENT OF INCOME
                           (Millions of dollars)

                                        52-Week 
                                     Period Ended
                          Dec. 30,   Dec. 31,       Jan. 1,
                             1995       1994          1994
Revenues
  Net sales, including
   leased and licensed
   department sales. . . . $6,531      $6,564        $5,623
  Direct response
   marketing revenues,
   including insurance . .    554         465           400
    Total Revenues . . . .  7,085       7,029         6,023

Costs and Expenses
  Cost of goods sold,
   including net
   occupancy and
   buying expense. . . . .  5,178       5,093         4,258
  Operating, selling,
   general and adminis-
   trative expenses,
   including benefits
   and losses of direct
   response operations
   (Note 16) . . . . . . .  1,806       1,699         1,562
  Interest expense
   (Note 17) . . . . . . .     91          58            43
    Total Costs and
     Expenses. . . . . . .  7,075       6,850         5,863

Income Before
  Income Taxes . . . . . .    10          179           160

Income Tax (Benefit)
  Expense (Note 8) . . . .    (1)          62            59

Net Income . . . . . . . .     11         117           101
   
Preferred Stock
  Dividend Requirements
  (Note 13). . . . . . . .      4           2             -

Net Income Applicable to
  Common Shareholders. . . $    7      $  115        $  101

Net Income per Class A
  Common Share
 (Note 14) . . . . . . . . $  .16      $ 2.68        $ 2.29

Net Income per Class B
  Common Share
   (Note 14) . . . . . . . $  .14      $ 2.30        $ 2.04

Cash Dividends declared
  per Common Share
   Class A . . . . . . . . $   -       $  .50        $  .50
   Class B . . . . . . . . $   -       $  .50        $  .50


              See notes to consolidated financial statements.
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
                        CONSOLIDATED BALANCE SHEET
                           (Millions of dollars)


                                  ASSETS

                                       December 30,   December 31,
                                           1995           1994
  
Cash and cash equivalents. . . . . . . . .$    37       $   33
Short-term investments . . . . . . . . . .      1            3
Investments of insurance operations
  (Note 3) . . . . . . . . . . . . . . . .    345          314
    Total Cash and Investments . . . . . .    383          350

Trade and other accounts receivable. . . .    166          112
Accounts and notes receivable from
  affiliates (Note 4). . . . . . . . . . .     22            6
    Total Receivables. . . . . . . . . . .    188          118

Merchandise inventories (Note 5) . . . . .  1,770        1,625
Prepaid pension cost (Note 6). . . . . . .    335          324
Properties, plants and equipment,
  net of accumulated depreciation
  and amortization (Note 7). . . . . . . .  1,366        1,396
Direct response and insurance
  acquisition costs. . . . . . . . . . . .    395          322
Other assets . . . . . . . . . . . . . . .    447          402
Total Assets . . . . . . . . . . . . . . . $4,884       $4,537


                   LIABILITIES AND SHAREHOLDERS' EQUITY

Short-term debt (Note 11). . . . . . . . . $  160       $  144
Trade accounts payable . . . . . . . . . .  1,804        1,719
Federal income taxes payable (Note 8)  . .      6           14
Accrued liabilities and other 
  obligations (Notes 2, 4, 6, 9
  and 14). . . . . . . . . . . . . . . . .  1,195        1,231
Insurance policy claim reserves
  (Note 10). . . . . . . . . . . . . . . .    236          236
Long-term debt (Note 11) . . . . . . . . .    423          228
Obligations under capital leases
  (Note 12). . . . . . . . . . . . . . . .     66           81
Deferred income taxes (Note 8) . . . . . .    119          122
    Total Liabilities. . . . . . . . . . .  4,009        3,775

Commitments and Contingent
  Liabilities (Notes 11 and 18)

Redeemable Preferred Stock (Note 13) . . .    175           75

Shareholders' Equity
  Common stock (Note 14) . . . . . . . . .      1            -
  Capital in excess of par value . . . . .     45           23
  Retained earnings. . . . . . . . . . . .    758          751
  Unrealized gain on marketable
   equity securities . . . . . . . . . . .     10            2
  Less:  Treasury stock, at cost . . . . .  (114)         (89)
    Total Shareholders' Equity . . . . . .    700          687
Total Liabilities and
  Shareholders' Equity . . . . . . . . . . $4,884       $4,537




              See notes to consolidated financial statements.
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
              CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
              (Millions of dollars, except per share amounts)


       Class A Class B Capital
       Common  Common     in
       Stock   Stock    Excess                    Treasury   Total
       $ .01   $ .01      of              Unre-   Stock, Share-
        Par      Par      Par   Retained  alized  at     holders'
       Value   Value    Value Earnings  Gains Cost  Equity
       (Number of shares
        in thousands)                                     

Balance,
January 2, 
1993, as
restated      20,672   25,000   $16     $580     $ 3   $(46)     $553

Net
 income            -        -     -      101       -       -      101
Cash
 dividends
 paid              -        -     -     (23)       -       -     (23)     
Tax benefit
 of stock 
 option exer-
 cises and
  other share
  exchanges        -        -     2        -       -       -        2
Shares repur-
  chased as 
  Treasury
  stock      (1,258)        -     -        -       -    (27)     (27)
Shares
 issued 
 upon exer-
 cise of
 options         193        -     1        -       -       -        1
Shares
 issued
 upon exer-
 cise of
 conversion
 rights            3        -     -        -       -       -        -

Balance,
January 
1,1994        19,610   25,000    19      658       3    (73)      607

Cumulative
  effect of 
  change in
  accounting
  principle        -        -      -      -       13       -       13

Balance,
January 1,
1994 as
restated      19,610   25,000   $19     $658     $16   $(73)     $620







              See notes to consolidated financial statements.
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
        CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (Continued)
              (Millions of dollars, except per share amounts)


       Class A Class B Capital
       Common  Common     in
       Stock   Stock    Excess                    Treasury   Total
       $ .01   $ .01      of              Unre-   Stock, Share-
        Par      Par      Par   Retained  alized  at     holders'
       Value   Value    Value Earnings  Gains Cost  Equity
       (Number of shares
        in thousands)                                     

Balance,
January 1, 
1994, as
restated      19,610   25,000   $19     $658     $16   $(73)     $620

Net
 income            -        -     -      117       -       -      117
Cash
 dividends
 paid              -        -     -     (24)       -       -     (24)     
Tax benefit
 of stock 
 option exer-
 cises             -        -     1        -       -       -        1
Change in 
  unrealized
  gain on   
  marketable
  securities       -        -     -        -    (14)       -     (14)
Shares repur-
 chased as
 Treasury
 stock         (629)        -     -        -       -    (16)     (16)
Shares
 issued 
 upon exer-
 cise of
 options         297        -     3        -       -       -        3
Shares
 issued
 upon exer-
 cise of
 conversion
 rights            2        -     -        -       -       -        -

Balance,
December
31,1994       19,280   25,000   $23     $751    $  2   $(89)     $687








              See notes to consolidated financial statements.
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
        CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (Continued)
              (Millions of dollars, except per share amounts)


            Class A Class B           Capital
            Common Common              in
            Stock  Stock              Excess                   Treasury Total
             $ .01  $ .01               of              Unre-  Stock,   Share-
             Par       Par    Common   Par    Retained  alized at       holders'
            Value     Value   Stock    Value  Earnings  Gains  Cost     Equity
            (Number of shares
              in thousands)                                     

Balance,
January 
1, 1995      19,280    25,000    $ -      $23    $751    $  2   $(89)   $687

Net
 income           -         -      -        -      11       -      -      11
Cash
 dividends
 paid             -         -      -        -     (4)       -      -     (4)
Compensation
 expense on
  stock option
  grants/repur-
 chases           -         -      -        5      -       -       -      5
Change in 
  unrealized
  gain on
  marketable
  securities      -         -      -        -      -       8       -      8
Shares repur-
 chased as
 Treasury
 stock       (1,052)        -      -        -      -       -     (25)   (25)
Shares
 issued 
 upon exer-
 cise of
 options        980         -      1       17      -       -       -     18
Shares
 issued
 upon exer-
 cise of
 conversion
 rights            2         -      -       -       -       -      -       -

Balance,
December
30,1995      19,210      25,000    $ 1    $45     $758    $10  $(114)   $700







             See notes to consolidated financial statements. 
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
                   CONSOLIDATED STATEMENT OF CASH FLOWS
                           (Millions of dollars)

                                         52-Week
                                       Period Ended
                                Dec. 30,   Dec. 31,   Jan. 1,
                                 1995        1994        1994
Cash flows from operating
  activities:
   Net income. . . . . . . .    $  11         $ 117         $ 101
   Adjustments to reconcile
    net income to net cash
    provided by (used in)
    operations:
     Depreciation and
       amortization. . . . . .    119           109            98
     Deferred income taxes . .    (7)            29            25
     Gain on sale of assets. .   (11)           (1)             -
     Gain on stock 
       distribution. . . . .     (16)             -             -
     Compensation expense on 
       stock option grants/
       repurchases . . . . . .      4             1             -
   Changes in operating
    assets and liabilities,
    net of businesses 
    acquired:
     (Increase) decrease in:
       Trade and other accounts
        receivable               (54)           (38)           (9)
       Accounts and notes
        receivable from
        affiliates               (16)            (2)           14
       Merchandise
        inventories. . . . . . (145)           (243)         (204)
       Prepaid pension
        cost . .                (11)            (15)          (19)
       Other assets. . . . . .  (77)            (50)          (50)
     Increase (decrease) in:
       Trade accounts
        payable. .               85              291          148
       Federal income taxes
        payable, net . . . . . . (9)               5           (1)
       Accrued liabilities
        and other
        obligations. . . . . . .(55)             (41)          33
       Insurance policy
        claim reserves . . . . .   -              (1)          (4)
       Deferred income taxes       -              (8)           -
       Net cash (used in)
        provided by
        operations . . . . .    (182)            153           132

Cash flows from investing
  activities:
   Investment in ValueVision .    (8)              -             -
   Investment in Merchant 
    Partners . . . . . . . .      (4)            (1)             -
   Acquisition of Lechmere,
    net of cash acquired . .        -          (109)             -
   Acquisition of Smilesaver,
    net of cash acquired . .        -           (11)             -
   Purchase of short-term
    investments. . . . . . . .   (60)          (231)         (248)
   Purchase of investments
    of insurance
    operations . . . . . . .    (791)          (691)         (688)
   Sale of short-term
    investments. . . . . . .      62            247           240
   Sale of investments
    of insurance
    operations . . . . . . .     775            671           669
   Disposition of
    properties, plants
    and equipment, net . . .      39             8             3
   Capital expenditures. . .    (122)         (184)         (142)
       Net cash used in
        investing
        activities . . . . . .$ (109)         $(301)        $(166)





              See notes to consolidated financial statements.
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
             CONSOLIDATED STATEMENT OF CASH FLOWS (Continued)
                           (Millions of dollars)

                                           52-Week
                                        Period Ended
                             Dec. 30,     Dec. 31,      Jan. 1,
                                1995        1994         1994
Cash flows from financing
  activities:
   Proceeds from issuance
    of short-term
    debt, net  . . . . . . . .   $ 16          $144         $   -
   Proceeds from issuance
    of long-term 
    debt . . . . . . . . . . .    205           168           100
   Payments of Montgomery
    Ward long-term
    debt . . . . . . . . . . .   (10)         (179)          (12)
   Payments of Lechmere
    long-term debt . . . . .        -          (88)             -
   Payments of obligations
    under capital leases . .      (7)           (8)           (6)
   Proceeds from issuance
    of common stock. . . . .      18             3             1
   Proceeds from issuance
    of preferred stock . . .     175            75             -
   Payments to redeem
    preferred stock. . . . .     (75)            -             -
   Cash dividends paid . . . .    (4)          (24)          (23)
   Purchase of treasury
    stock, at cost . . . . .     (23)           (9)          (11)
   Tax benefit of stock
    options exercised
    and other share
    exchanges. . . . . . . . .      -             1             2
       Net cash provided
       by financing
       activities. . . . . . .    295            83            51

Increase (Decrease) in cash
  and cash equivalents . . .        4          (65)            17

Cash and cash equivalents
  at beginning of period . .       33            98            81

Cash and cash equivalents
  at end of period . . . . . .   $ 37          $ 33          $ 98


              See notes to consolidated financial statements.

<PAGE>                       MONTGOMERY WARD HOLDING CORP.
                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       (Dollar amounts in millions)
 

1.  Major Accounting Policies

Business Segments

 Montgomery Ward Holding Corp. (the Company or MW Holding) and its
wholly owned subsidiary, Montgomery Ward & Co., Incorporated
(Montgomery Ward), are engaged in retail merchandising and direct
response marketing (including insurance) in the United States. 
Retail merchandising operations are conducted through Montgomery
Ward and Montgomery Ward's, wholly-owned subsidiary Lechmere, Inc.
(Lechmere), while direct response marketing operations are
conducted primarily through Signature Financial/Marketing, Inc.
(Signature), a wholly-owned subsidiary of Montgomery Ward. 
Signature markets consumer club products and insurance products
through its subsidiaries.  See Note 20 for information regarding
these segments.


Principles of Consolidation; Use of Estimates

 The consolidated financial statements include the Company and all
subsidiaries.  Investments in 20 percent to 50 percent owned
affiliates where significant influence exists are accounted for on
the equity method.  All significant intercompany accounts and
transactions are eliminated in consolidation.  Certain prior period
amounts have been reclassified to be comparable with the current
period presentation.

 The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting
period.  Actual results could differ from those estimates.


Fiscal Year

 The Company operates on a 52- or 53- week fiscal year basis.  The
Company's fiscal year ends on the Saturday closest to December 31. 
The fiscal years ended December 30, 1995, December 31, 1994 and
January 1, 1994 included 52 weeks.
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)


1. Major Accounting Policies (continued)

Cash and Cash Equivalents

 Cash and cash equivalents include cash on hand, time deposits and
highly liquid debt instruments with an original maturity of three
months or less from the date of purchase.  The carrying amount
reported in the financial statements for cash and cash equivalents
approximates the fair value of these assets.

         Following is a summary of cash payments for interest and income
taxes and non-cash financing and investing activities:

                                        52-Week
                                     Period Ended
                          Dec. 30,     Dec. 31,     Jan. 1,
                            1995          1994        1994
 Cash paid for:
  Income taxes . . . . . . $  24          $  33         $ 46
  Interest . . . . . . . . $  82          $  56         $ 55

 Non-cash financing
  activities:
   Notes issued for
     purchase of
     Treasury stock. . . . $   2          $   7         $ 16

 Non-cash investing
  activities:
   Change in unrealized
     gain on marketable
     securities. . . . . . $   8          $(14)         $  -
   Like-kind exchange of
     assets. . . . . . . . $   -          $   5         $  6
   Gain on Stock
     distribution. . . . . $  16          $   -         $  -

The net cumulative effect of changes in accounting principles of
$13 in 1994 has no cash impact.


Investments of Insurance Operations

 The Company accounts for investments under Statement of Financial
Accounting Standards (SFAS) No. 115, "Accounting for Certain Investments
In Debt and Equity Securities".  Under SFAS No. 115, all debt and equity
securities are classified as "available-for-sale" and are stated at
fair market value with all changes in unrealized gains or losses
included in Shareholder's Equity.  
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)


1.       Major Accounting Policies (continued)

Merchandise Inventories

         Merchandise inventories are valued at the lower of cost or
market, using the retail last-in, first-out (LIFO) method.


Properties, plants and equipment

         Depreciation is computed on a straight-line basis over the
estimated useful lives of the properties, with annual rates ranging
between 2% and 3% for buildings and between 12% and 25% for
fixtures and equipment.  Leasehold improvements and assets under
capital leases are amortized on a straight-line basis over no
longer than the primary term of the lease.  Upon retirement or
disposition, the cost and the related depreciation or amortization
are removed from the accounts, with the gains or losses included in
income.

         Interest relating to construction in progress is capitalized and
amortized over the useful life of the property.  Pre-operating
expenditures which are not capital in nature are charged against
income in the year the store is opened.  Normal maintenance and
repairs are expensed as incurred.  Major repairs that materially
extend the lives of properties are capitalized, and the assets
replaced, if any, are retired.

         In March, 1995, the Financial Accounting Standards Board issued
SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to be Disposed Of".  The Company will implement SFAS
No. 121 during fiscal year 1996.  The provisions require a review
of long-lived assets for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not
be recoverable.  If it is determined that an impairment loss has
occurred based on expected undiscounted future cash flow, the loss
will be recognized in the income statement and certain disclosures
will be made regarding the impairment.  The impact of the adoption
of this statement is not reasonably estimatable at this time.

<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)


1.       Major Accounting Policies (continued)

Direct Response Marketing Revenues

         Life and accident and health insurance premiums, which are
recognized as revenue when due from policyholders, are associated
with related benefits and expenses to result in the recognition of
profit over the terms of the policies.  Property-liability
insurance premiums and club membership dues are deferred and earned
on a pro-rata basis over the terms of the policies and memberships. 
Unearned premiums and club memberships of $61 and $63 at December
30, 1995 and December 31, 1994, respectively, are included in
Accrued liabilities and other obligations.


Direct Response and Insurance Acquisition Costs

         Costs allocated to the insurance and club memberships in force at
June 24, 1988, as well as the costs of acquiring new club
memberships and insurance business (primarily marketing expenses),
are included in Direct response and insurance acquisition costs. 
Costs of acquiring new business have been deferred when considered
recoverable.

         Acquisition costs are amortized in proportion to the revenue
recognized.  The time period over which deferred policy and
membership acquisition costs are being amortized and the
recoverability of such costs could differ from estimates due to
changing market conditions.  Amortization of deferred policy and
membership acquisition costs is continually reviewed, and, as
adjustments become necessary, they are reflected in current
operations.  Amortization charged to income was $151, $124 and $111
for 1995, 1994 and 1993, respectively, and is included in
Operating, selling, general and administrative expenses.
 

Interest Rate Exchange and Cap Agreements

         Amounts paid or received pursuant to interest rate exchange and
cap agreements are deferred and amortized as interest expense or
income over the remaining life of the applicable agreement.

<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)


1.       Major Accounting Policies (continued)

Insurance Policy Claim Reserves

         Liabilities for future policy benefits have been determined
principally by the net level premium method.  These amounts have
been computed by using assumptions that include provisions for risk
of adverse deviation.  The assumptions developed for interest rates
(average 6%-8%) and withdrawal rates are based on the experience of
Montgomery Ward Life Insurance Company, a wholly-owned subsidiary
of Signature.  The principal mortality tables used to develop the
assumed mortality rates are the 1960 Commissioners' Standard Group
Table, the 1955-1960 and 1965-1970 Basic Mortality Tables and the
1969-1971 U.S. Life Tables.  The reserve for claims and related
adjustment expenses is based on estimates of the costs of
individual claims reported and incurred but not reported prior to
year-end.  While management believes the reserve for claims and
related adjustment expenses is adequate, the reserve is continually
reviewed and as adjustments become necessary, they are reflected in
current operations.


Federal Income Tax

         The Company and its subsidiaries file a consolidated Federal
income tax return.  Beginning in 1994, insurance subsidiaries which
had previously filed separate Federal income tax returns are
included in the consolidated return.

         The Company determines its income tax expense and related
deferred federal income taxes in accordance with SFAS No. 109.


2.       Acquisition of Lechmere, Inc.

         Montgomery Ward acquired in a merger transaction all the stock of
LMR Acquisition Corporation, which owned 100% of the stock of
Lechmere, on March 30, 1994.  The aggregate purchase price was
$113.

         The closing price included a $10 promissory note (the Note) of
Montgomery Ward, which bears interest at a rate of 4.87% per annum. 
The Note balance is $3 at December 31, 1995 and is included in
Accrued liabilities and other obligations.  The balance is payable
three years after the date of the Note.  The Note is secured by a
standby letter of credit.
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)


2. Acquisition of Lechmere, Inc. (continued)

         As part of the closing, Montgomery Ward advanced approximately
$88 and assumed $3 in obligations to enable Lechmere to retire its
outstanding bank debt and subordinated debt. 

         The acquisition was accounted for as a purchase.  The purchase
price has been allocated to Lechmere's net assets based upon
results of asset valuations and liability and contingency
assessments.  

         The allocation is summarized as follows:

     Inventory . . . . . . . . . . . . . . . . . . . . $140
     Properties, Plants & Equipment. . . . . . . . . .   54
     Goodwill  . . . . . . . . . . . . . . . . . . . .  124
     Other Assets. . . . . . . . . . . . . . . . . . .   50
     Due to Montgomery Ward. . . . . . . . . . . . . . (88)
     Accounts Payable and Other Liabilities. . . . . .(167)
                                                       $113     
      

<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)


3.  Investments of Insurance Operations

  Following is a summary of Investments of insurance operations
in securities other than related party investments.  The fair
values for marketable debt and equity securities are based on
quoted market prices.
                                 December 30, 1995
                                                  
                             Gross       Gross          
  Type of                   Unrealized   Unrealized   Market  
 Investment         Cost     Gains       Losses        Value 

Fixed maturities
  Bonds:
   United States
    Govern-
    ment and
    government
    agencies
    and author-
    ities. . . . . $ 54        $  1          $  -        $ 55
   Public
    utilities. . . . 70           8             -          78
   All other
    corporate
    bonds. . . . . . 19           2             -          21
  Mortgage-backed
   securities. . .  133           3           (1)         135
     Total
     fixed
     maturi-
     ties. .        276          14           (1)         289

Equity
  securities:
   Common
    stock. . . . .   13           4             -          17
     Total
     equity
     securi-
     ties. .         13           4             -          17     

Policy
  loans. . . . . .    7           -             -           7
Short-term
  investments. . .   32           -             -          32
    Total
    Invest-
    ments .        $328           $18         $(1)       $345

<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)


3.  Investments of Insurance Operations

                                 December 31, 1994
                                                  
                             Gross       Gross          
  Type of                   Unrealized   Unrealized   Market  
 Investment         Cost     Gains       Losses     Value 

Fixed maturities
  Bonds:
   United States
    Govern-
    ment and
    government
    agencies
    and author-
    ities. . . . . $ 51         $ -          $(2)        $ 49     
   Public
    utilities. . . . 73           6             -          79
   All other
    corporate
    bonds. . . . .   26           1           (1)          26
  Mortgage-backed
   securities. . .  115           -           (6)         109
     Total
     fixed
     maturi-
     ties. .       265             7          (9)         263

Equity
  securities:
   Common
    stock. . . . .    8           5             -          13
     Total
     equity
     securi-
     ties. .          8           5             -          13     

Policy
  loans. . . . . . .  7           -             -           7     
Short-term
  investments. . .   31           -             -          31
    Total
    Invest-
    ments .        $311         $12           $(9)       $314

<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)


3.  Investments of Insurance Operations (continued)

  The amounts of fixed maturities as of December 30, 1995 are as
follows:
                                            Amortized  Market
                                              Cost     Value

  Due in 1995. . . . . . . . . . . . . . . . .$ 21      $ 21
  Due in 1996 through 2000 . . . . . . . . . . 103       113
  Due in 2001 through 2005 . . . . . . . . . .  17        18
  Due in 2006 and beyond . . . . . . . . . . .   2         2
  Mortgage-backed securities . . . . . . . . . 133       135
                                              $276      $289


  Realized capital gains before income tax and changes in
unrealized gains (losses) after income tax on fixed maturities,
mortgage loans and equity securities are as follows:

                                         Fixed
                                        Maturities
                                      and Mortgage  Equity
                                         Loans      Securities
52-Week Period Ended December 30, 1995
 Realized. . . . . . . . . . . . . . . . . .$ 1         $ 5
 Unrealized. . . . . . . . . . . . . . . . .$ 8         $ 3

52-Week Period Ended December 31, 1994
 Realized. . . . . . . . . . . . . . . . . .$ -         $ -
 Unrealized. . . . . . . . . . . . . . . . $(2)         $ 4

52-Week Period Ended January 1, 1994
 Realized. . . . . . . . . . . . . . . . . .$ 1         $ -
 Unrealized. . . . . . . . . . . . . . . . .$ -         $ 3


4.  Accounts and Notes Receivable from Affiliates

 Montgomery Ward and Montgomery Ward Credit Corporation
(Montgomery Ward Credit), a subsidiary of GE Capital Corporation
(GE Capital) have entered into an Account Purchase Agreement
pursuant to which Montgomery Ward Credit purchases receivables from
time to time and provides services to Montgomery Ward.  Under this
agreement, Montgomery Ward Credit has the exclusive right to
operate the Montgomery Ward private label credit card system and
the obligation to  purchase for  their face value (and Montgomery
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

4.  Accounts and Notes Receivable from Affiliates (continued)

Ward is obligated to sell) all the receivables generated by the
Montgomery Ward private label credit card system, including those
generated through MW Direct, up to $6,000 outstanding at any
time. Montgomery Ward accounts for the transfer as a sale of the
applicable receivables.  Sales of receivables to Montgomery Ward
Credit were $3,938, $4,092 and $3,991 for 1995, 1994 and 1993,
respectively.  At December 30, 1995 and December 31, 1994, there
were $5,348 and $5,221, respectively, of Montgomery Ward credit
card receivables owned by Montgomery Ward Credit.  Amounts
receivable from Montgomery Ward Credit pursuant to the sale of
such receivables are included in Accounts and notes receivable
from affiliates.

  Montgomery Ward is exposed to both market risk and credit risk
under the Account Purchase Agreement.  Under the Account Purchase
Agreement, Montgomery Ward is required to pay Montgomery Ward
Credit the excess interest costs on a monthly basis if a blended
interest rate applicable to Montgomery Ward Credit's finance costs
with respect to the receivables exceeds 10% per annum.  To date,
the blended interest rate has been less than 10%.

  Should Montgomery Ward Credit or its guarantor, GE Capital, fail
to perform its obligations under the Account Purchase Agreement,
Montgomery Ward would suffer an accounting loss up to the amount of
Montgomery Ward's share of finance charges and late fees (as
described below), net of applicable reserves carried by Montgomery
Ward Credit.  Montgomery Ward estimates that any accounting loss
would be immaterial at December 30, 1995.  Montgomery Ward Credit's
obligations under the Account Purchase Agreement are not
collateralized.

  Effective January 1, 1994, Montgomery Ward bears the entire risk
of credit losses.  Previously credit losses were shared. 
Montgomery Ward's remaining liability for credit losses for 1991
through 1994 are payable to Montgomery Ward Credit in early 1998. 
In addition, the amounts payable by Montgomery Ward for credit
losses for 1995 through 1997 may be deferred, and such deferred
credit losses are also payable at Montgomery Ward's election in
early 1998.  Interest on Montgomery Ward's liability for credit
losses is payable at a rate equal to rates on comparable borrowings
of Montgomery Ward.

  In exchange for Montgomery Ward's agreement to allow Montgomery
Ward Credit to increase finance charge rates in selected states,
Montgomery Ward receives a share of incremental finance charges 
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

4.  Accounts and Notes Receivable from Affiliates (continued)

resulting from such increases which is available for offset
against the credit losses, and earns interest at the same rate as
amounts owned by Montgomery Ward to Montgomery Ward Credit.  In
1995, Montgomery Ward entered into an agreement with Montgomery
Ward Credit to increase late fee assessments and implement
previously agreed upon finance charge increases in various
states, as allowed by statute.  Montgomery Ward's share of these
incremental finance charges and late fees is calculated in the
same manner as the prior 1992 agreement.  Incremental finance
charges are generated only on purchases subsequent to the date
such finance charge rates are increased.  In the event that, due
to the increase in finance charge rates and late fees, any
refunds are required to be made, Montgomery Ward and Montgomery
Ward Credit have agreed to share the financial risk.  Legislation
has from time to time been introduced in certain states which, if
enacted, may require rescinding all or a portion of such rate
increases, in which case, Montgomery Ward's share of rate
increases may be substantially reduced.

  In addition to sharing incremental finance charges and late
fees, with respect to each fiscal year, Montgomery Ward Credit will
make a payment to Montgomery Ward of a share of all finance charges
in an amount equal to (a) if credit losses are 5% or less of
average gross receivables, the lesser of 3.9% of average gross
receivables or the actual credit losses; (b) if credit losses are
greater than 5% but less than or equal to 8% of average gross
receivables, 3.9% of average gross receivables plus 50% of the
amount by which actual credit losses exceed 5% of average gross
receivables; or (c) if credit losses exceed 8% of average gross
receivables, 5.4% of average gross receivables plus the amount by
which credit losses exceed 8% of average gross receivables.  In the
event that finance charges billed during a fiscal year less the
incremental finance charges and late fee assessments referred to
below are less than the amount computed above, the payments will be
reduced to the amount of the finance charge less the incremental
finance charge.

  The Company has executed notes for the credit losses which
totalled $224 with respect to credit losses through 1995.  The
incremental finance charges and late fee assessments due to
Montgomery Ward at the end of 1995 were $44.  All amounts are
included in Accrued liabilities and Other obligations at December
30, 1995.  Under the agreement, the notes payable to Montgomery
Ward Credit are limited to $300 at any time, with any excess to be
paid currently in cash.  The Company does not expect credit losses
for the period through 1997 to exceed the $300 limitation.  
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)


4.  Accounts and Notes Receivable from Affiliates (continued)

  The Account Purchase Agreement will be in effect until December
31, 2006, and thereafter from year to year unless either party
gives ten years prior notice of its election to terminate.  


5.  Merchandise Inventories

 Merchandise inventories are valued using the retail LIFO method,
which matches current costs with current sales.  If inventories had
been valued using the first-in, first-out (FIFO) method, they would
have been $124, $133 and $117 higher than those reported as of
December 30, 1995, December 31, 1994 and January 1, 1994,
respectively.

6.  Retirement Plans

 Retirement plans of a contributory nature cover a majority of
full-time associates of Montgomery Ward and its subsidiaries. 
Retirement benefits are provided by a defined benefit pension plan
as well as by a savings and profit sharing plan.  Montgomery Ward
and its subsidiaries contribute to the defined benefit pension plan
to cover any excess of defined minimum benefits over the benefits
available.

 The components of the net pension credit were as follows:

                                         52-Week
                                       Period Ended
                          Dec. 30,      Dec. 31,    Jan. 1,
                            1995          1994        1994
  Service cost-benefits
   earned during the
   period. . . . . . . . . .$(10)         $(13)        $(11)
  Interest cost on
   projected benefit
   obligation. . . . . . .   (51)          (46)         (45)
  Actual return on
   assets  . . . . . . . . .  185             4          101
  Deferral of unantici- 
   pated investment
   performance . . . . . .  (110)            72         (26)
  Amortization of
   unrecognized
   net loss. . . . . . . . .  (3)           (2)            -
  Net pension credit . . . .$  11         $  15        $  19

  Assumptions:
   Discount rate . . . . .   8.5%          7.5%         8.5%
   Increase in future
    compensation . . . . . . 6.0%          6.0%         6.0%
   Rate of return 
    on plan assets . . . . . 9.5%          9.5%         9.5%
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

6.  Retirement Plans (continued)

  The funded status of the defined benefit pension plan was as
follows:
                                       December 30,  December 31,
                                          1995          1994
  Actuarial present value of
   accumulated benefit
   obligation:
    Vested . . . . . . . . . . . . . . . $(660)       $(576)
    Nonvested. . . . . . . . . . . . . .    (3)          (4)

  Accumulated benefit obligation . . . . .(663)        (580)
  Additional amounts related
   to projected increases in
   compensation levels . . . . . . . . .   (16)         (23)

  Projected benefit obligation . . . . . .(679)        (603)
  Plan assets at fair value,
   primarily in equity
   and fixed income securities . . . . . .  898          789

  Plan assets in excess of projected
   benefit obligation. . . . . . . . . . .$ 219        $ 186

   Unrecognized net loss
    since initial 
    application of FAS 87. . . . . . . . .$ 118        $ 140
   Unrecognized prior
    service cost since
    initial application
    of FAS 87. . . . . . . . . . . . . .  $ (2)        $ (2)
    Prepaid pension cost . . . . . . . .  $ 335        $ 324


  The projected benefit obligation was determined using an assumed
discount rate of 7.5% at December 30, 1995 and 8.5% at December 31,
1994 and an assumed rate of increase in future compensation levels
of 6% for 1995 and 1994.  Excess unrecognized net gains and losses
and prior service costs are amortized over the average future
service period.

  The savings and profit sharing plan includes a voluntary savings
feature for eligible associates and matching company contributions
based on a fixed percentage of certain associates' contributions. 
The company matching expense was $6 for each of 1995, 1994 and
1993.  
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

6.  Retirement Plans (continued)

  Substantially all associates who retire after participattion in
the retirement plan for ten years and who were members of the
health care plan for the year prior to retirement are eligible for
certain post-retirement health care and life insurance benefits,
the cost of which is shared with the retirees.  Associates who
retire as of January 1, 1996 are no longer eligible for post-
retirement life insurance benefits.  In 1992, the Company
established a limit on its future annual contributions on behalf of
retirees at a maximum of 125% of the projected 1992 company
contributions. 

  The Company accounts for postretirement benefits under the
provisions of SFAS No. 106, "Employers' Accounting for Postretirement
Benefits Other Than Pensions".

  The components of the net periodic postretirement benefit cost
were as follows:
                                          52-Week Period Ending 
                                        1995      1994   1993

   Service Cost. . . . . . . . . . . . .$  2      $ 2     $ 2
   Interest cost on accumulated
    postretirement benefit
    obligation . . . . . . . . . . . . .  10       11      12
   Curtailment gain on life insurance
    benefit termination. . . . . . . .   (3)        -       -
   Net periodic postretirement
    benefit cost . . . . . . . . . . . .$  9      $13     $14

  The status of the Company's liability for postretirement benefits
at December 30, 1995 and December 31, 1994, which are included in
Accrued liabilities and other obligations is as follows:

                                                1995    1994
   Accumulated postretirement
    benefit obligation:
     Retirees. . . . . . . . . . . . . . . . . .$ 90    $104
     Fully eligible active associates. . . . . .  17      18
     Other active associates . . . . . . . . . .  22      26
     Total accumulated
       postretirement benefit
       obligation. . . . . . . . . . . . . . . . 129     148
    Unrecognized prior service cost. . . . . . .  15       -
    Net gain (loss). . . . . . . . . . . . . . . (4)     (4)
    Accumulated postretirement
     benefit obligation. . . . . . . . . . . . .$140   $144
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

6.  Retirement Plans (continued)

  The weighted average discount rate used in measuring the
accumulated postretirement benefit obligation was 7.5% at December
30, 1995 and 8.5% at December 31, 1994.  The assumed health care
cost trend rate and the impact of a 1% increase in the medical
trend rate on the accumulated postretirement benefit obligation,
service cost and interest cost are not applicable due to caps
established on current cost levels.
  
  The Company continues to evaluate ways in which it can better
manage retiree benefits and control costs.  Any changes in the plan
or revisions to assumptions that affect the amount of expected
future benefits may have a significant effect on the amount of the
reported obligation and annual expense.


7.  Properties, Plants and Equipment

  The details of the properties, plants and equipment accounts are 
shown below at cost:
                                     December 30,   December 31,
                                       1995           1994

Land     . . . . . . . . . . . . . .$   201          $   197
Buildings. . . . . . . . . . . . . . .  867              860
Leasehold improvements . . . . . . . .  534              319
Fixtures and equipment . . . . . . . .  355              503
Assets under capital leases. . . . . .  101              111
Less accumulated depreciation
         and amortization. . . . . .  (692)            (591)
Properties, Plants, and
         Equipment, net. . . . . . . $1,366           $1,399

         Gains or (losses) on the sale of properties were $11, $1 and $0
for 1995, 1994 and 1993, respectively.  Accumulated amortization on
capital lease assets was $50 and $49 for 1995 and 1994,
respectively. 
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)


8.       Income Taxes

         The Company has alternative minimum tax (AMT) credits of $26, $24
and $31 as of December 30, 1995, December 31, 1994 and January 1,
1994, respectively, available to offset future Federal income tax
liabilities.  The Company has targeted jobs tax credit
carryforwards of $16 and net operating loss (NOL) carryforwards of
$68 available as of December 30, 1995, which expire beginning in
2007.

         The approximate tax effects of temporary differences and
carryforwards that give rise to the deferred tax liability are as
follows:
                                        December 30,    December 31,
                                            1995            1994

  Accrued liabilities. . . . . . . . . $(130)           $(169)
  Postretirement benefits. . . . . . .   (56)             (56)
  Insurance reserves . . . . . . . . . . (65)             (61)
  Other deferred tax assets. . . . . . . (29)             (23)
   Total deferred tax assets . . . . . .(280)            (309)
 
  Prepaid pension contribution . . . . .  132              128
  Direct response and insurance
   acquisition costs . . . . . . . . .    150              127
  Property, plants and equipment . . .    145              133
  Other deferred tax liabilities . . . .   50               47
   Total deferred tax liabilities. . .    477              435

  AMT and other credit
   carryforwards . . . . . . . . . . . .(110)             (36)
  Valuation allowance. . . . . . . . . .   32               32
   Net deferred tax liability. . . . .  $ 119            $ 122

<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

8. Income Taxes (continued)

 Income tax expense consists of:
                                       52-Week
                                    Period Ended
                          Dec. 30,   Dec. 31,      Jan. 1,
                            1995         1994        1994
  Federal
   Currently payable . . . $  7          $25          $28
   Deferred (benefit)
    payable. . . . . . . . .(7)           29           25
  State, local
   and foreign (benefit)
    payable. . . . . . . .  (1)            8            6
  Total income
   tax (benefit)
   expense . . . . . . . . $(1)          $62          $59


  A reconciliation of the statutory to effective federal income tax
rate is as follows:
                                       52-Week
                                    Period Ended
                          Dec. 30,   Dec. 31,      Jan. 1,
                            1995         1994        1994
  Federal income
   tax rate. . . . . . . .  35%          35%           35%
  State taxes, net
   of reduction of
   Federal tax and
   NOL benefit . . . . . . (16)            3             2
  Targeted Jobs
   Tax Credit. . . . . . . (60)          (3)           (1)
  Impact of increase 
   in statutory rate . . .    -            -             1
  Deferred rate 
   differential, net
   of adjustments. . . . . .(5)          (3)             -
  Permanent differences. .   34            2             -
  Effective income
   tax rate. . . . . . . .(12)%          34%           37%
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)


9.  Deferred Service Contract Revenue

  The Company sells product service contracts on its own behalf,
and beginning in 1994, on behalf of Virginia Surety Company, Inc.
(VSC).  The Company recognizes the revenue related to sales of
Montgomery Ward service contracts in proportion to the costs
expected to be incurred in performing services under the contracts. 
Deferred service contract revenue of $169 and $231 at December 30,
1995 and December 31, 1994, respectively, is included in Accrued
liabilities and other obligations.  The Company recognizes the
revenue, net of the fixed payment due to VSC on sales of VSC
contracts at the time of sale.  VSC insured contracts comprised 70%
and 17% of sales of service contracts to Montgomery Ward customers
in 1995 and 1994, respectively.  Montgomery Ward has contracted
with VSC to provide repair services to VSC.


10. Reinsurance

  The Company's insurance subsidiaries are involved in both the
cession and assumption of reinsurance with other companies.  Risks
are reinsured with other companies to permit the recovery of a
portion of the direct losses.  Policy related liabilities and
accruals, including incurred but not reported claims, are included
in the financial statements as Insurance policy claim reserves, and
reinsurance ceded is reflected as a component of Other assets.  The
Company remains liable to the extent the reinsuring companies
cannot meet their obligations under these reinsurance treaties.

<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

10.                            Reinsurance (continued)

  Premium revenues, which are included in Direct response marketing
revenues, are as follows:
                                                          Percentage
                         Ceded To     Assumed              of Amount
                 Gross    Other      from Other    Net      Assumed 
                 Amount  Companies   Companies    Amount    To Net

52-Week Period
  Ended Decem-
  ber 30, 1995:
 
Life
  insurance
  in force . .  $5,886       $(84)       $ -       $5,802      0.0 %

Premiums
  Life
   insurance .  $   53       $ (1)       $ 2       $   54      3.7%
  Accident and
   health
   insurance . .    91         (5)        15          101     14.9%
  Property and
   liability
   insurance .      73        (12)         -           61     0.0%
    Total. . .  $  217       $(18)       $17       $  216     7.9%


52-Week Period
  Ended Decem-
  ber 31, 1994:

Life insurance
  in force . .  $5,729       $(93)       $ -       $5,636     0.0%

Premiums
  Life
   insurance .  $   50       $ (1)       $  3      $   52     5.8%
  Accident and
   health
   insurance . .    76          -          11          87    12.6%
  Property and
   liability
   insurance .      62         (9)          -          53     0.0%
    Total. . .  $  188      $ (10)       $ 14      $  192     7.3%


52-Week Period
  Ended Janu-
  ary 1, 1994:

Life insurance
  in force . .  $5,438     $(102)        $ -       $5,336     0.0%

Premiums
  Life
   insurance .  $   45     $  (1)        $ 3       $   47     6.4%
  Accident and
   health
   insurance . .    67         -          13           80    16.3%
  Property and
   liability
   insurance .      51        (8)          -           43     0.0%
    Total. . .  $  163     $  (9)        $16       $  170     9.4%
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

11.      Short-Term and Long-Term Debt

         The long-term debt of Montgomery Ward and its subsidiaries is as
follows:
                                       December 30,   December 31,
                                           1995         1994 
Montgomery Ward
 Note Purchase Agreements; Senior Notes
  Series A to Series J due in 1998 
  to 2005 at 6.52% to 8.18% interest
  rates. . . . . . . . . . . . . . . . . .  $280        $100
 Bank Term Loan, due in 1999 at 
  6.07% interest rate. . . . . . . . . . . .  25           -
 Commercial Development Revenue Bonds,
  due in 2013 at 4.5% interest rate,
  adjusted at three-year intervals . . . .     5           5
 Other . . . . . . . . . . . . . . . . . .     2           2

Montgomery Ward Real Estate Subsidiaries
 4 3/4% Secured Notes, due serially 
  to January 15, 1995. . . . . . . . . . .     -           1
 11 1/2% Secured Note, due serially
  to September 1, 2001 . . . . . . . . . . .  14          15
 7 1/2% Secured Note, due serially
  to November 30, 2002 . . . . . . . . . . .   6           6
 9.45% Secured Notes, due serially
  to November 30, 2003 . . . . . . . . . . .  16          18
 7 3/4% Secured Notes, due serially
  to August 31, 2004 . . . . . . . . . . . .  19          20
 7 7/8% Secured Notes, due serially
  to December 15, 2005 . . . . . . . . . .     8           9
 9% Secured Notes, due serially to
  January 1, 2006. . . . . . . . . . . . . .  12          13
 Other . . . . . . . . . . . . . . . . . . .   8          10
  
Lechmere
 9.65% Secured Mortgage Notes, due
  October 31, 1996 . . . . . . . . . . . . .  24          24
 Other . . . . . . . . . . . . . . . . . . .   4           5
     Total long-term debt. . . . . . . . . .$423        $228
 

 The  amounts  of  long-term debt that become due during the
fiscal years 1996 through 1999 are as follows:  1996--$34,
1997--$9, 1998--$19, 1999--$10, and 2000--$91.

<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

11. Short-Term and Long-Term Debt (continued)

  Montgomery Ward has entered into a Long Term Credit Agreement
(Long Term Agreement) dated as of September 15, 1994 with various
lenders.  The Long Term Agreement, which was extended during 1995
and currently expires September 6, 2000, provides for a revolving
facility in the principal amount of $603.  As of December 30, 1995,
no borrowings were outstanding under the Long Term Agreement. 
Concurrently, Montgomery Ward also entered into a Short Term Credit
Agreement (Short Term Agreement) dated as of September 15, 1994
with various lenders.  The Short Term Agreement, which was extended
during 1995 and currently expires September 6, 1996, provides for
a revolving facility in the principal amount of $297.  As of
December 30, 1995, $160 was outstanding under the Short Term
Agreement.

  Under the Agreements, Montgomery Ward may select among several
interest rate options, including a rate negotiated with one or more
of the various lenders.  The interest rates for the aforementioned
bank borrowings are based on market rates and significant increases
in market interest rates will increase interest payments required. 
A commitment fee is payable based upon the unused amount of each
facility, although under certain circumstances, an additional fee
may be payable to lenders not participating in a negotiated rate
loan.  The weighted average interest rate paid under the Agreements
was 6.25% for 1995.

  During the fourth quarter of 1994, Montgomery Ward entered into
interest rate exchange and cap agreements with various banks to
offset the market risk associated with an increase in interest
rates under both the Long Term Agreement and Short Term Agreement. 
The aggregate notional principal amounts under the interest rate
exchange agreements is $175 in 1995 through 1997 and $75 in 1998
through 1999.  Under the terms of the interest rate exchange
agreements, Montgomery Ward pays the banks a weighted average fixed
rate of 7.4% from 1995 through 1997 and 7.6% from 1998 through 1999
and will receive the one-month daily average London Interbank
Offered (LIBO) rate in each case multiplied by the notional
principal amount.  The average aggregate notional principal amounts
under the various cap agreements is $154 in 1995, $158 in 1996 and
$113 in 1997.  Under the terms of the cap agreements, Montgomery
Ward receives payments from the banks when the one-month daily
average LIBO rate exceeds the 5.5% cap strike rate in 1995, 6% cap
strike rate in 1996 and 7.0% cap strike rate in 1997.  Such
payments will equal the amount determined by multiplying the
notional principal amount by the percentage, if any, by which the
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

11. Short-Term and Long-Term Debt (continued)

one-month daily average LIBO rate exceeds the cap strike rate. 
The exchange and cap agreements resulted in interest expense of
$3 and increased the effective interest rate under the Agreements
by .48% in 1995.  Montgomery Ward is exposed to credit risk in
the event of nonperformance by the other parties to the interest
rate exchange and cap agreements; however, Montgomery Ward
anticipates full performance by the counterparties.  The fair
market value of the exchange and cap agreements was $(9) and $0,
respectively, at December 30, 1995.  Fair value is estimated
based upon the amount that Montgomery Ward would receive or pay
to terminate the agreements as of the reporting date, utilizing
quoted prices for comparable contracts. 

  On July 11, 1995, Montgomery Ward entered into a Note Purchase
Agreement (1995 Note Purchase Agreement) with various lenders
involving the private placement of $180 of Senior Notes which have
maturities of from five to ten years at fixed interest rates
varying from 6.52% to 6.98%.  Proceeds from the debt issue were
used to repay short-term borrowings incurred to fund the Company's
acquisition of Lechmere.  

  On September 29, 1995, Montgomery Ward borrowed $25 under a Term
Loan Agreement (Term Loan Agreement) with a bank.  The borrowings
mature on September 30, 1999.  Under the Term Loan Agreement,
Montgomery Ward may select several interest rate options which are
based on market rates.  

  The Agreements, the Term Loan Agreement, the 1993 Note Purchase
Agreements and the 1995 Note Purchase Agreement impose various
restrictions on Montgomery Ward, including the satisfaction of
certain financial tests which include restrictions on payments of
dividends.  Under the terms of the Agreements and the Term Loan
Agreement, which are currently the most restrictive of the
financing agreements as to dividends, distributions and
redemptions, Montgomery Ward may not pay dividends or make any
other distributions to the Company or redeem any Common Stock in
excess of (1) $63 on a cumulative basis, plus (2) 50% of
Consolidated Net Income of Montgomery Ward (as defined in the
Agreements) after January 1, 1994, plus (3) any repayment by the
Company of any loan or advance made by Montgomery Ward to the
Company which was received after January 1, 1994, plus (4) capital
contributions received by Montgomery Ward after January 1, 1994,
plus (5) net proceeds received by Montgomery Ward from (a) the
issuance of capital stock including treasury stock but excluding
Debt-Like Preferred Stock (as defined in the Agreements) or (b) any
indebtedness which is converted into shares of capital stock other
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

11. Short-Term and Long-Term Debt (continued)

than Debt-Like Preferred Stock of Montgomery Ward or the Company,
after January 1, 1994, plus (6) an adjustment of $45 for 1995
through 1996, $30 in 1997 and $15 in 1998.  The MW Senior
Preferred Stock discussed in Note 13 constitutes Debt-Like
Preferred Stock for purposes of the dividend restrictions under
the Agreements.  At December 30, 1995, Montgomery Ward could pay
dividends and make other distributions to the Company of $108
pursuant to the terms of the Agreements.  To date, Montgomery
Ward has been in compliance with all such financial tests.

  Montgomery Ward has outstanding Commercial Development Revenue
Bonds, which are adjusted to the market rate of interest at
three-year intervals.  The rate was adjusted to 4.5% in 1995.

  The Secured Notes of the real estate subsidiaries and the secured
Mortgage Notes of Lechmere are secured by mortgage liens and/or
assignments of rental agreements whereby the real estate
subsidiaries have assigned to trustees certain monies payable under
leases with Montgomery Ward.  At December 30, 1995, assets with a
net book value of approximately $188 represented collateral for
certain of these secured notes.

  The market value of the Company's long-term debt of $417 is
estimated using discounted cash flow analyses, based on the
Company's current incremental borrowing rates for similar types of
borrowing arrangements.


12. Leases

  The Company leases real and personal property principally through
noncancelable capital and operating leases, which generally provide
for the payment of minimum rentals and, in certain instances,
executory costs and additional rentals based upon a percentage of
sales.  The terms of the real estate leases typically contain
renewal options for additional periods.
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

12. Leases

  At December 30, 1995, the minimum lease payments under all
noncancelable operating leases with an initial term of more than
one year, not including $37 of future sublease rentals, and under
capital leases are as follows:
                                             Capital  Operating 
                                             Leases   Leases   

  1996 . . . . . . . . . . . . . . . . . . . . $13     $  119
  1997 . . . . . . . . . . . . . . . . . . . .  12        110
  1998 . . . . . . . . . . . . . . . . . . . .  11         99
  1999 . . . . . . . . . . . . . . . . . . . .  11         90
  2000 . . . . . . . . . . . . . . . . . . . .  11         84
  Later Years. . . . . . . . . . . . . . . . .  40        799
   Total Minimum Lease Payments. . . . . . . . $98     $1,301

  Less Executory Costs, principally real
   estate taxes to be paid by the lessor . . .  (4)
  Less Imputed Interest. . . . . . . . . . . . (28)

  Present Value of Net Minimum Capital
   Lease Payments Including Portion due
   within one year of $7 . . . . . . . . . . . $66


  Net rent expense charged to earnings was $140 for 1995, $130 for
1994 and $104 for 1993 after deducting rentals from subleases of $9
in 1995, 1994 and 1993.  Rent expense includes contingent lease
rentals for capital and operating leases of $12 for 1995, $13 for
1994 and $11 for 1993.  These contingent lease rentals are
generally based on sales revenues.  

  Some rental agreements contain escalation provisions that may
require higher future rent payments.  Rent expense incurred under
rental agreements which contain escalation clauses is recognized on
a straight-line basis over the life of the lease.
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
          (Dollar amounts in millions, except per share amounts)


13. Redeemable Preferred Stock                  

  On April 27, 1994, the Company's Certificate of Incorporation was
amended to authorize the issuance of a new series of senior
preferred stock (Senior Preferred Stock).  On that date, the
Company issued all of the 750 shares of Senior Preferred Stock
authorized by the Certificate of Incorporation to General Electric
Capital Corporation in exchange for $75 in cash.  The Company used
the proceeds to acquire 750 shares of a new issue of senior
preferred stock of Montgomery Ward (Montgomery Ward Preferred) for
$75 and Montgomery Ward used the proceeds to reduce short-term
borrowings.  On December 29, 1995, Montgomery Ward redeemed the
Montgomery Ward Preferred held by the Company for $75.  The Company
used the proceeds to redeem the Senior Preferred Stock held by GE
Capital for $75.  The source of the funds for these transactions
was borrowing under the Agreements.  Dividends on the Senior
Preferred Stock and Montgomery Ward Preferred had been paid
quarterly at an annual rate of $4,850 per share. 

  On December 29, 1995, Montgomery Ward issued 1,750 shares of a
new series of senior preferred stock (MW Senior Preferred Stock),
par value of $1.00 per share, to GE Capital in exchange for $175 in
cash.  Subsequent to year end, Montgomery Ward used a portion of
the proceeds to finance the purchase of the Amoco Motor Club by its
wholly-owned subsidiary, Signature.  The subscription agreement for
the MW Senior Preferred Stock contains an exchange option which
gives GE Capital the option to exchange the MW Senior Preferred
Stock for senior preferred stock of the Company with identical
terms.  On January 31, 1996, GE Capital exercised the exchange
option.

  Dividends on the MW Senior Preferred Stock are payable quarterly
at an annual rate of $7,010 per share.  Montgomery Ward is required
to redeem the MW Senior Preferred on June 30, 2002, with the option
of redeeming all or any portion prior to June 30, 2002. 
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
          (Dollar amounts in millions, except per share amounts)


14. Common Stock

  The Company has the following authorized classes of common stock:

   Class A Common Stock, Series 1; $.01 par value; 25,000,000
   shares authorized; 19,018,394 shares issued and outstanding,
   net of 5,996,819 shares held in treasury.

   Class A Common Stock, Series 2; $.01 par value; 5,412,000
   shares authorized; 191,399 shares issued and outstanding, net
   of 1,674,319 shares held in treasury.

   Class A Common Stock, Series 3; $.01 par value; 2,400,000
   shares authorized; no shares issued or outstanding.

   Class B Common Stock; $.01 par value; 25,000,000 shares
   authorized, issued and outstanding; all owned by GE Capital.

  The Company has repurchased 5,632,147 shares held by certain
former officers of the Company, Montgomery Ward and Signature and
their permitted transferees by making cash payments and issuing
installment notes in the aggregate of approximately $47.  As of
December 30, 1995, the outstanding balance of these notes was $14. 
These installment notes bear interest at varying rates, are payable
over multi-year periods (generally three to five years) and are
secured by shares of Common Stock, the fair market value of which
is equal to the outstanding principal amount under each note.  The
notes are classified as Accrued liabilities and other obligations. 
Under all of the Agreements, Montgomery Ward expects to be able to
advance the Company sufficient funds to allow the Company to make
the required installment payments in 1996.

   Each share of Class B Common Stock entitles the holder thereof
to one vote.  All shares of Class A Common Stock entitle the
holders to a total of 25,000,000 votes, or one vote per share if
the total number of Class A shares issued and outstanding is less
than 25,000,000.
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
          (Dollar amounts in millions, except per share amounts)

14. Common Stock (continued)

  Net income per common share is computed as follows:

                                             52-Week Period Ended 
                                               December 30, 1995
                                             Class A     Class B
Earnings available for Common Share-
  holders. . . . . . . . . . . . . . .       $  3          $  4

Weighted average number of common
  and common equivalent shares
  (stock options) outstanding. . . . . 20,824,514    25,000,000

Earnings per share . . . . . . . . . .       $.16          $.14



                                             52-Week Period Ended 
                                               December 31, 1994 
                                             Class A     Class B
Earnings available for Common Share-
  holders, after deducting preferred
  stock dividend requirements. . . . .        $57          $58

Weighted average number of common
  and common equivalent shares
  (stock options) outstanding. . . . . 21,407,379   25,000,000

Earnings per share . . . . . . . . . .      $2.68        $2.30




                                             52-Week Period Ended
                                               January 1, 1994
                                             Class A     Class B
Earnings available for Common
  Shareholders . . . . . . . . . . . .        $50          $51

Weighted average number of common
  and common equivalent shares
  (stock options) outstanding. . . . . 21,805,203   25,000,000

Earnings per share . . . . . . . . . .      $2.29        $2.04

<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
          (Dollar amounts in millions, except per share amounts)

15. Stock Ownership Plan

         The Montgomery Ward & Co., Incorporated Stock Ownership Plan was
adopted effective July 19, 1988.  A total of 1,000,000 Class A
Common Stock, Series 1, 5,412,000 shares of Class A Common Stock,
Series 2, and 2,000,000 shares of Class A Common Stock, Series 3,
have been reserved for issuance under the plan.  Key associates of
Montgomery Ward and its subsidiaries are eligible to participate
and may receive awards, purchase rights and options.  Awards are
grants of shares for no consideration.  Options for 2,792,088 and
2,926,286 of Class A Common Stock, Series 2 and Series 3 shares
were exercisable at December 30, 1995 and December 31, 1994,
respectively.

         Following is a summary of activity under the plan.

                                                  Option Price
                                         Options    Range

 Outstanding January 2, 1993 . . . . . 3,596,908  $ 0.20-$18.75
 Granted, 1993 . . . . . . . . . . . . 1,979,105  $18.75-$22.50
 Exercised, 1993 . . . . . . . . . . . (192,864)  $ 0.20-$18.75
 Cancellations, 1993 . . . . . . . . . (520,083)  $ 0.20-$22.50
 Outstanding January 1, 1994 . . . . . 4,863,066  $ 0.20-$22.50
 Granted, 1994 . . . . . . . . . . . . 2,010,236  $12.50-$26.50
 Exercised, 1994 . . . . . . . . . . . (297,415)  $ 0.20-$22.50
 Cancellations, 1994 . . . . . . . . . (890,285)  $ 0.20-$26.50
 Outstanding, December 31, 1994. . . . 5,685,602  $ 0.20-$26.50
 Granted, 1995 . . . . . . . . . . . . . 613,145  $24.50-$26.50
 Exercised, 1995 . . . . . . . . . . . (980,373)  $  .20-$24.50
 Cancellations, 1995 . . . . . . . . . (571,231)  $  .20-$26.50
 Outstanding December 30, 1995 . . . . 4,747,143  $  .20-$26.50
 

 During 1991, the Board of Directors approved the Directors Plan. 
The Directors Plan was established to, among other things, allow
outside directors to receive all or any portion of the fees for
their services as directors of the Company and Montgomery Ward via
conversion rights in Series 1 or Series 2 shares.  In 1995, 1994
and 1993, 2,476, 2,489 and 3,466 Series 1 shares were issued from
treasury as payment for directors fees, respectively.

 In October, 1995, the Financial Accounting Standards Board issued
SFAS No. 123, "Accounting for Stock-Based Compensation".  This standard
is effective for fiscal years beginning after December 15,
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)


15. Stock Ownership Plan (continued)

1995 and therefore will be adopted by Montgomery Ward in 1996. 
Montgomery Ward's Stock Option Plan is covered by this statement. 
Under SFAS No. 123, entities may adopt the fair value based
method for stock-based compensation plans, or continue to use the
accounting method prescribed by APB Option No. 25, "Accounting for
Stock Issued to Employees" and provide pro-forma disclosures in the
footnotes to the financial statements of net income and earnings
per share as if the fair value based method defined in SFAS No.
123 had been applied.  Montgomery Ward intends to adopt the
disclosure method of this statement.


16. Operating, Selling, General and Administrative Expenses

 Operating, selling, general and administrative expenses include
benefits and losses related to direct response marketing operations
of $100, $102 and $93 for the periods ended December 30, 1995,
December 31, 1994 and January 1, 1994, respectively.

 A provision for severance costs and relocation of certain
administrative functions of both Montgomery Ward and Lechmere of
$25 is included in Operating, selling, general and administrative
expenses at December 30, 1995.


17. Interest Expense, Net of Investment Income

 Net interest expense is as follows:
                                         52-Week
                                       Period Ended
                            Dec. 30,     Dec. 31,     Jan. 1,
                             1995        1994         1994
  Interest on short-term
   borrowings. . . . . . . . $ 47           $19         $ 12
  Interest on long-term
   debt and obligations
   under capital leases. . .   32            30           24
  Miscellaneous interest,
   net . . . . . . . . . . .   15            11            8
  Investment income. . . . .  (3)           (2)          (1)
  Total interest expense,
   net of investment
   income. . . . . . . . . . .$91           $58          $43
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
          (Dollar amounts in millions, except per share amounts)


18. Litigation and Other Proceedings

   MW Holding, Montgomery Ward and its subsidiaries are engaged in
various litigation and have a number of unresolved claims.  While
the amounts claimed are substantial and the ultimate liability with
respect to such litigation and claims cannot be determined at this
time, management is of the opinion that such liability, to the
extent not provided for through insurance or otherwise, is not
likely to have a material impact on the financial condition and the
results of operations of the Company.
 

19. Related Party Transactions

   Substantially all shares of Class A Series 1 and Series 2
Common Stock, except those held by the Chairman and Chief Executive
Officer of the Company and a trust established for the benefit of
his children, are held by a Voting Trust which was created in 1988. 
In 1994, a second voting trust was created to hold shares of Class
A Series 3 Common Stock.  A Voting Trustee (currently the Chairman
and Chief Executive Officer of the Company) has sole voting power
and control of all shares held by both Voting Trusts.  The 1988
Voting Trust will expire June 21, 1998 or upon the occurrence of
certain specified events in accordance with the Voting Trust
Agreement.  The 1994 Voting Trust has no expiration date but may
expire upon the occurrence of certain specified events in
accordance with the Voting Trust Agreement.

   The Company engages in various transactions with GE Capital as
described in Notes 4, 13 and 14.

   On August 8, 1995, Montgomery Ward purchased 1,280,000
unregistered shares of common stock of ValueVision at $6.25 per
share, which represents approximately 4.4% of the issued and
outstanding shares of common stock of ValueVision International,
Inc. (Value Vision).  Montgomery Ward accounts for the investment
using the cost method.  Montgomery Ward also received warrants to
purchase an additional 25 million shares of common stock of
ValueVision with exercise prices ranging from $6.50 to $17.00 per
share, with an average exercise price of $9.16 per share.  The
warrants were valued at $18 at the time of grant and are included
in Other assets at December 30, 1995.  The corresponding deferred
revenue of $18 was recognized as a liability and included in
Accrued liabilities and other obligations.  At December 30, 1995,
the balance of the deferred revenue is $17.  The deferred revenue
will be recognized by Montgomery Ward as services are provided by
<PAGE> 
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

19. Related Party Transactions (continued)

ValueVision in the future.  These services are for expenses
incurred for advertising by ValueVision, purchasing cable TV time
for Montgomery Ward goods and services, use of the Montgomery
Ward service mark and use of Montgomery Ward Credit.  The
warrants vest over time, subject to the vesting termination and
acceleration provisions in the agreement.  

   In July, 1994, Montgomery Ward became a limited partner in
Merchant Partners, Limited Partnership (Merchant Partners).  The
purpose of this partnership is to invest in new and emerging growth
businesses and leveraged buy-outs to achieve a superior rate of
return.  Montgomery Ward made capital contributions of $4 and $1 in
1995 and 1994, respectively, and accounts for the investment using
the equity method.  Per the terms of the agreement, additional
funding may be required within limitations set forth in the
agreement.  The cumulative maximum capital contribution is $40.  In
December, 1995, Merchant Partners made a partnership distribution
of $22 to Montgomery Ward.  The distribution consisted of $8 of
common stock and $14 of warrants of a publicly traded company. 
After recognition of the portion of the distribution that was
recorded as a return of capital of $5 and the partnership's net
loss allocation as of December 30, 1995 of $1, a gain of $16 was
recognized in the Consolidated Statement of Income.
  
   Montgomery Ward paid on behalf of those associates and past
associates of Montgomery Ward and certain of its subsidiaries who
purchased stock in the Company in 1988, the legal fees and related
costs and expenses in connection with certain deficiencies in tax
assessed by the Internal Revenue Service, and certain Tax Court
cases.  All assessments were settled in 1994. Montgomery Ward paid
approximately $4 in 1993 for services rendered in connection with
the aforementioned matters.  

<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

19. Related Party Transactions (continued)
   
   The Company offers a line of credit program for certain
associates, including directors who are associates and executive
officers of the Company (Line of Credit Program).  Under the Line
of Credit Program, the Company arranged  with banks (Program Banks)
for lines of credit of up to $10 in the aggregate for all
participants in the Line of Credit Program.  Any associate who
borrows money from the Program Banks under the Line of Credit
Program is required to pledge to such Program Banks as collateral
a number of shares owned by such associate, the fair market value
of which is equal to twice the amount the associate borrows.  In
the event any associate should default upon his or her repayment
obligations, the Company anticipates that it will repurchase that
individual's note from the Program Banks, together with the Banks'
security interest in the pledged stock, at the face amount of the
note plus up to one year's interest.  At December 30, 1995, the
borrowings outstanding under the Line of Credit Program were $1.

<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

20. Business Segments

  Montgomery Ward and its subsidiaries are engaged in retail
merchandising and direct response marketing, including insurance,
in the United States.  Following is information regarding revenues,
earnings and assets of the Company by segment.

                                         52-Week
                                     Period Ended
                          Dec. 30,      Dec. 31,     Jan. 1,
                            1995          1994        1994
  Total Revenues
   Retail Merchandising. . $6,531        $6,564       $5,623
   Direct Response
    Marketing. . . . . . .    554           465          400
     Total . . . . . . . .  7,085        $7,029       $6,023

  Operating Earnings (Losses)
   Retail Merchandising. . $   64        $  208       $  171
   Direct Response
    Marketing. . . . . . .     70            60           54
   Corporate and
    Other (a). . . . . . .  (124)          (89)         (65)
     Total . . . . . . . . $   10        $  179       $  160

  Identifiable Assets
   Retail Merchandising. . $3,504        $3,314       $2,627
   Direct Response
    Marketing. . . . . . .    920           789          753
    Corporate and Other. .    460           434          455
     Total . . . . . . . . $4,884        $4,537       $3,835

  Depreciation and
  Amortization
   Retail Merchandising. . $  118        $  105       $   95
   Direct Response
    Marketing. . . . . . .      1             4            3
     Total . . . . . . . . $  119        $  109       $   98

  Capital Expenditures
   Retail Merchandising. . $  109        $  180       $  139
   Direct Response
    Marketing. . . . . . .     13             4            3
     Total . . . . . . . . $  122        $  184       $  142

  (a)  Includes $25 of severance and relocation costs.  See Note
       16 to the Consolidated Financial Statements.

  Under the laws and regulations applicable to insurance companies,
certain subsidiaries of Signature are limited in the amount of
dividends they may pay without the approval of the Illinois
Insurance Department and are prohibited from making any loans and
advances to Montgomery Ward and its affiliates.  Under these laws,
the restricted subsidiaries, which had aggregate retained earnings
of $165, and aggregate total shareholders equity of $224, can pay
dividends of $50 during 1996 as determined on a statutory basis,
subject to the ability of certain subsidiaries to generate earned
surplus.  Dividends received by Signature from insurance
subsidiaries were $40, $42 and $35 for 1995, 1994 and 1993.  
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

21. Parent Company Financial Information

  Following is the MW Holding balance sheet as of December 30, 1995
and December 31, 1994 and the statements of income and cash flows
for the 52-week periods ended December 30, 1995, December 31, 1994
and January 1, 1994.

                       MONTGOMERY WARD HOLDING CORP.
                               BALANCE SHEET

                                  ASSETS
                                       December 30, December 31,
                                           1995         1994

 Federal Income Taxes Receivable . . . . . .$  4        $  4
 Investment in Montgomery Ward . . . . . . . 782         766
 Redeemable Preferred Stock of
  Montgomery Ward. . . . . . . . . . . . . .   -          75
 Other assets. . . . . . . . . . . . . . . .   1           -
  Total Assets . . . . . . . . . . . . . . .$787        $845


                   LIABILITIES AND SHAREHOLDERS' EQUITY

 Accounts Payable to Montgomery Ward . . . .$ 73        $ 57
 Accrued Liabilities . . . . . . . . . . . .  14          26
  Total Liabilities. . . . . . . . . . . . .  87          83

 Redeemable Preferred Stock. . . . . . . . .   -          75

 Common Stock. . . . . . . . . . . . . . . .   1           -
 Capital in excess of par value. . . . . . .  45          23
 Retained Earnings . . . . . . . . . . . . . 758         751
 Unrealized gain on marketable equity
  securities . . . . . . . . . . . . . . . .  10           2
 Less:  Treasury stock, at cost. . . . . . (114)        (89)
  Total Shareholders' Equity . . . . . . .   700         687
 Total Liabilities and
  Shareholders' Equity . . . . . . . . . . .$787        $845


                            STATEMENT OF INCOME

                                         52-Week
                                     Period Ended
                          Dec. 30,      Dec. 31,    Jan. 1,
                            1995          1994          1994

 Miscellaneous Costs . . . .$(1)           $(2)         $(1)
  Total Costs and
   Expenses. . . . . . . . . (1)            (2)          (1)
 Tax Benefits. . . . . . . .   -              -            -

 Net Loss Before
  Earnings of
  Montgomery Ward. . . . . . (1)            (2)          (1)
 Equity in Net Income
  of Montgomery Ward . . . .  12            119          102
 Net Income. . . . . . . . .  11            117          101
 Preferred Stock Dividend
  Requirements . . . . . . .   4              2           - 

 Net Income Available
  for Common
  Shareholders . . . . . . .$  7           $115         $101
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                       (Dollar amounts in millions)

21. Parent Company Financial Information (continued)

                          STATEMENT OF CASH FLOWS
                          
                          December 30,  December 31,   January 1,
                              1995         1994            1994

 Net Income. . . . . . . . . .$ 11            $117          $101
 Adjustments to reconcile
  net income to net cash
  provided:
   Change in undis-
     tributed earnings
     of subsidiary . . . . .   (8)            (96)          (79)
   Compensation expense
     on stock option grants/
     repurchases . . . . . . .   4               1             -
   Decrease (increase) in:
     Other assets. . . . . . . (1)               -             1
   Increase (decrease) in:
     Accounts payable to
      Montgomery Ward. . . .    16              22            12
     Accrued liabilities . . .(13)            (15)           (4)

 Net cash provided
  before financing
  activities . . . . . . . . .   9              29            31

 Cash flows from financing
  activities:
   Proceeds from issuance
     of common stock . . . .    18               3             1
   Proceeds from redemption
     of Montgomery Ward
     preferred stock . . . . .  75               -             -
   Proceeds from issuance
     of preferred stock. . . .   -              75             -
   Purchase of Montgomery
     Ward preferred
    stock. . . . . . . . . . .   -            (75)             -
   Cash dividends paid . . .   (4)            (24)          (23)
   Payments to redeem
     preferred stock . . . . .(75)               -             -
   Purchase of treasury 
     stock, at cost. . . . . .(23)             (9)          (11)
   Tax benefit of stock
     options exercised
     and other stock
     exchanges . . . . . . . .   -               1             2

 Net cash used for
  financing activities . . . . (9)            (29)          (31)

 Cash at end of period . . . .$  -           $   -          $  -

 Non-cash investing
  activities:
   Change in unrealized
   gain on investments . . .  $  8           $ (1)          $  -

 Non-cash financing
  activities:
   Notes issued for
   purchase of
   treasury stock. . . . . . .$  2           $   7          $ 16
<PAGE>
                       MONTGOMERY WARD HOLDING CORP.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
          (Dollar amounts in millions, except per share amounts)

22. Quarterly Financial Data (unaudited)

 The quarterly operations of MW Holding are summarized as follows:

                                         Quarter
                         First Second  Third Fourth   Year
52-Week Period Ended
December 30, 1995
  Net sales. . . . . . .$1,357  $1,521   $1,561  $2,092  $6,531
  Cost of goods sold . . 1,075   1,211    1,240   1,652   5,178
  Net (Loss) Income. . .   (4)      11        3       1      11
  Net (Loss) Income
   per Class A
   Common Share. . . . . (.12)     .25      .05       -     .16
  Net (Loss) Income
   per Class B
   Common Share. . . . . (.10)     .20      .04       -     .14

52-Week Period Ended
December 31, 1994
  Net sales. . . . . . .$1,215  $1,519   $1,571  $2,259  $6,564
  Cost of goods sold . .   931   1,184    1,235   1,743   5,093
  Net Income . . . . . .    10      28       15      64     117
  Net Income per Class A
   Common Share. . . .     .23     .62      .33    1.51    2.68
  Net Income per Class B
   Common Share. . . . .   .20     .53      .29    1.28    2.30


23. Subsequent Event

   Subsequent to year end, Signature acquired all of the outstanding
capital stock of Amoco Enterprises, Inc., operator of the Amoco
Motor Club and a wholly-owned subsidiary of Amoco Oil Holding
Company.  See Note 13 to the Consolidated Financial Statements
concerning financing of the acquisition.

<PAGE>
Item  9. Disagreements on Accounting and Financial Disclosure.

         None.

                                 PART III


Item 10. Directors and Executive Officers of the Company

         Information as to executive officers required by this item is
included under the caption "Executive Officers of the Registrant"
beginning on page 16.  Information as to directors required by this
item is incorporated herein by reference, pursuant to General
Instruction G(3) to Form 10-K, from the Registrant's definitive
proxy statement, for the annual meeting of shareholders to be held
on May 31, 1996, to be filed within 120 days of the end of the
Registrant's fiscal year.  

Item 11. Executive Compensation

         Incorporated herein by reference, pursuant to General Instruction
G(3) to Form 10-K, from the Registrant's definitive proxy
statement, for the annual meeting of shareholders to be held on May
31, 1996, to be filed within 120 days of the end of the
Registrant's fiscal year.

Item 12. Security Ownership of Certain Beneficial Owners and
         Management.

         Incorporated herein by reference, pursuant to General Instruction
G(3) to Form 10-K, from the Registrant's definitive proxy
statement, for the annual meeting of shareholders to be held on May
31, 1996, to be filed within 120 days of the end of the
Registrant's fiscal year.

Item 13. Certain Relationships and Related Transactions

         Incorporated herein by reference, pursuant to General Instruction
G(3) to Form 10-K, from the Registrant's definitive proxy
statement, for the annual meeting of shareholders to be held on May
31, 1996, to be filed within 120 days of the end of the
Registrant's fiscal year.
<PAGE>
Item 14. Exhibits, Financial Statement Schedules, and Reports on
         Form 8-K's.

  (a)  1. Financial Statements.
                                                            Page

   Report of Independent Public Accountants. . . . . . . . .29
    Consolidated Balance Sheet at December 30, 1995
     and December 31, 1994 . . . . . . . . . . . . . . . . .31
    For the 52-Week Periods Ended December 30, 1995,
     December 31, 1994 and January 1, 1994
     Consolidated Statement of Income. . . . . . . . . . . .30
       Consolidated Statement of Shareholders' Equity. . . .32
       Consolidated Statement of Cash Flows. . . . . . . . .35
   Notes to Consolidated Financial Statements. . . . . . . .37


       2. Financial Statement Schedules.

   Schedules have been omitted because they are not applicable, not
required, not material, or the required information is given in the
financial statements or notes thereto or combined with the
information presented in other schedules or exhibits.
<PAGE>
Item 14. Exhibits, Financial Statement Schedules, and Reports on
         Form 8-K. (Continued)

   3.  Exhibits

2.(i)(A)      Agreement and Plan of Merger dated March 17, 1994
              by and among Montgomery Ward & Co., Incorporated,
              MW Merger Corp., LMR Acquisition Corporation,
              Lechmere, Inc. and stockholders of LMR Acquisition
              Corporation executing counterparts of this
              agreement, incorporated by reference to Exhibit
              2.(i)(A) of the Company's Annual Report on Form 10-
              K for the fiscal year ended January 1, 1994.                   
2.(i)(A)(1)   First Amendment to Agreement and Plan of Merger
              dated June 15, 1994, by and among Montgomery Ward
              & Co., Incorporated, LMR Acquisition Corporation,
              and the Stockholders' Committee, incorporated by
              reference to Exhibit 2.(i)(A)(1) of the Company's
              Quarterly Report on Form 10-Q for the fiscal
              quarterly period ended July 2, 1994.
2.(ii)        Agreement  of  Purchase  and  Sale  of  Stock 
              dated February 24, 1994 among Signature Financial/
               Marketing, Inc., Greater California Dental Services
               Plan, Inc. and National Dental Services, Inc.,
               incorporated by reference to Exhibit 2.(i)(A) of
               the Company's Annual Report on Form 10-K for the
               fiscal year ended January 1, 1994.              
3.1           Third Restated Certificate of Incorporation of
              Registrant, filed June 28, 1994, incorporated by
              reference to Exhibit 3.2(ii) of the Company's
              Registration Statement on Form S-1 (Registration
              No. 33-33252).
3.1(i)        Certificate of Amendment to Certificate of
              Incorporation of Montgomery Ward Holding Corp.
              dated October 25, 1994, incorporated by reference
              to Exhibit 3.2(iv) of the Company's Quarterly
              Report on Form 10-Q for the fiscal quarterly period
              ended October 1, 1994.
3.3           Amended and Restated By-laws of Registrant, dated
              as of December 29, 1994.
9.            Voting Trust Agreement dated as of June 21, 1988,
              incorporated by reference to Exhibit 3(a) of the
              Company's Registration Statement on Form S-1
              (Registration No. 33-23403).
<PAGE>
Item 14. Exhibits, Financial Statement Schedules, and Reports on
         Form 8-K. (Continued)

   3.  Exhibits (continued)

9.(i)              Voting Trust Agreement dated as of October 21,
                   1994, incorporated by reference to Exhibit
                   9.(i) of the Company's Quarterly Report on Form
                   10-Q for the fiscal quarterly period ended
                   October 1, 1994.
10.(i)(A)(1)      Stockholders' Agreement dated as of June 17,
                  1988, as amended and restated as of December
                  29, 1994, incorporated by reference to Exhibit
                  4.(e) to the Company's Registration Statement
                  on Form S-8 (Registration No. 33-57075).
10.(i)(A)(3)      Montgomery Ward & Co., Incorporated Stock
                  Ownership Plan Terms and Conditions, as amended
                  and restated, as of December 29, 1994,
                  incorporated by reference to Exhibit 4.(f) of
                  the Company's Registration Statement on Form
                  S-1 (Registration No. 33-57075).
10.(i)(B)          Stock Purchase Agreement dated March 6, 1988
                   between Mobil Corporation, Marcor Inc. and BFB
                   Acquisition Corp. incorporated by reference to
                   Exhibit 10.(i)(B) of the Company's Registration
                   Statement on Form S-1 (Registration No.
                   33-23403).
10.(i)(C)          Subscription Agreement dated as of December 29,
                   1995 between General Electric Capital
                   Corporation, Montgomery Ward & Co., Montgomery
                   Ward Holding Corp., and Bernard F. Brennan.
10.(i)(F)          Note Purchase Agreements dated March 1, 1993
                   between Montgomery Ward & Co., Incorporated and
                   various lenders, incorporated by reference to
                   Exhibit 10.(i)(F) of the Company's Annual
                   Report on Form 10-K for the fiscal year ended
                   January 2, 1993.

<PAGE>
Item 14. Exhibits, Financial Statement Schedules, and Reports on
         Form 8-K. (Continued)

   3.  Exhibits (continued)

10.(i)(F)(1)  Amendment dated June 30, 1995 to Note Purchase
              Agreements dated March 1, 1993 between Montgomery
              Ward & Co., Incorporated and various lenders,
              incorporated by reference to Exhibit 10.(i)(F)(1)
              of the Company's Quarterly Report on Form 10-Q for
              the fiscal quarterly period ended July 1, 1995.
10.(i)(H)      Long Term Credit Agreement dated as of September
               15, 1994 among Montgomery Ward & Co., Incorporated,
               various banks, The First National Bank of Chicago,
               as Documentary Agent, The Bank of Nova Scotia, as
               Administrative Agent, The Bank of New York, as
               Negotiated Loan Agent and Bank of America National
               Trust and Savings Association, as Advisory Agent,
               incorporated by reference to Exhibit 10.(i)(G) of
               the Company's Quarterly Report on Form 10-Q for the
               fiscal quarterly period ended October 1, 1994.
10.(i)(H)(1)  Amended Schedule 1 to the Long Term Credit
              Agreement dated as of September 15, 1994 among
              Montgomery Ward & Co., Incorporated, various banks,
              The First National Bank of Chicago, as Documentary
              Agent, The Bank of Nova Scotia, as Administrative
              Agent, The Bank of New York, as Negotiated Loan
              Agent and Bank of America National Trust and
              Savings Association, as Advisory Agent incorporated
              by reference to Exhibit 10.(i)(H)(1) of the
              Company's Quarterly Report on Form 10-Q, for the
              fiscal quarterly period ended September 30, 1995. 
10.(i)(I)      Short Term Credit Agreement dated as of September
               15, 1994 among Montgomery Ward & Co., Incorporated,
               various banks, The First National Bank of Chicago,
               as Documentary Agent, The Bank of Nova Scotia, as
               Administrative Agent, The Bank of New York, as
               Negotiated Loan Agent and Bank of America National
               Trust and Savings Association, as Advisory Agent,
               incorporated by reference to Exhibit 10.(i)(H) of
               the Company's Quarterly Report on Form 10-Q for the
               fiscal quarterly period ended October 1, 1994.
<PAGE>
Item 14. Exhibits, Financial Statement Schedules, and Reports on
         Form 8-K. (Continued)

   3.  Exhibits (continued)

10.(i)(I)(1)  Amended Schedule 1 to the Short Term Credit
              Agreement dated as of September 15, 1994 among
              Montgomery Ward & Co., Incorporated, various banks,
              The First National Bank of Chicago, as Documentary
              Agent, The Bank of Nova Scotia, as Administrative
              Agent, the Bank of New York, as Negotiated Loan
              Agent and Bank of America National Trust and
              Savings Association, as Advisory Agent,
              incorporated by reference to Exhibit 10.(i)(I)(1)
              of the Company's Quarterly Report on Form 10-Q for
              the fiscal quarterly period ended September 30,
              1995. 
10.(i)(J)      Note Purchase Agreement dated July 11, 1995 between
               Montgomery Ward & Co., Incorporated and various
               lenders, incorporated by reference to Exhibit
               10.(i)(J) on the Company's Quarterly Report on Form
               10-Q for the fiscal quarterly period ended July 1,
               1995.
10.(i)(K)      Term Loan Agreement dated as of September 29, 1995
               between Montgomery Ward & Co., Incorporated and The
               Industrial Bank of Japan, Limited, Chicago Branch,
               Incorporated by reference to Exhibit 10.(i)(K) of
               the Company's Quarterly Report on Form 10-Q for the
               fiscal quarterly period ended September 30, 1995.
10.(ii)(A)     Stock Purchase Agreement dated June 22, 1988
               between General Electric Capital Corporation and
               Montgomery Ward & Co., Incorporated, incorporated
               by reference to Exhibit 10.(ii)(A) of the Company's
               Registration Statement on Form S-1 (Registration
               No. 33-23403).
10.(ii)(B)     Account Purchase Agreement dated June 24, 1988 by
               and between Montgomery Ward Credit Corporation and
               Montgomery Ward & Co., Incorporated, incorporated
               by reference to Exhibit 10.(ii)(B) of the Company's
               Registration Statement on Form S-1 (Registration
               No. 33-23403).
10.(ii)(B)(1) Letter Agreement dated April 21, 1989, by and
              between  Montgomery Ward Credit Corporation and
              Montgomery Ward & Co., Incorporated (amending the
              Account Purchase Agreement which is Exhibit
              10.(ii)(B) hereto), incorporated by reference to
              Exhibit 10.(ii)(B)(1) of the Company's Registration
              Statement on Form S-1 (Registration No. 33-33252).
<PAGE>
Item 14. Exhibits, Financial Statement Schedules, and Reports on
         Form 8-K. (Continued)

   3.  Exhibits (continued)

10.(ii)(B)(2) Amendment to Account Purchase Agreement dated
              December 26, 1989 by and between Montgomery Ward
              Credit Corporation and Montgomery Ward & Co.,
              Incorporated, incorporated by reference to Exhibit
              10.(ii)(B)(2) of the Company's Registration
              Statement on Form S-1 (Registration No. 33-33252).
10.(ii)(B)(3) Letter Agreement dated April 24, 1990, by and
              between Montgomery Ward Credit Corporation and
              Montgomery Ward & Co., Incorporated, incorporated
              by reference to Exhibit 10.(ii)(B)(3) of the
              Company's Registration Statement on Form S-1
              (Registration No. 33-33252).
10.(ii)(C)     Letter Agreement dated June 24, 1988 among
               Signature Financial/Marketing, Inc., Montgomery
               Ward Credit Corporation and Montgomery Ward & Co.,
               Incorporated, incorporated by reference to Exhibit
               10.(ii)(C) of the Company's Registration Statement
               on Form S-1 (Registration No. 33-23403).
10.(ii)(D)     Letter Agreement dated December 26, 1990, by and
               between Montgomery Ward Credit Corporation and
               Montgomery Ward & Co., Incorporated, incorporated
               by reference to 10.(ii)(D) of the Company's Annual
               Report on Form 10-K for the fiscal year ended
               December 29, 1990.
10.(ii)(E)     Fifth Amendment to Account Purchase Agreement dated
               May 23, 1992 by and between Montgomery Ward & Co.,
               Incorporated and Montgomery Ward Credit
               Corporation, incorporated by reference to Exhibit
               10.(ii)(E) of the Company's Quarterly Report on
               Form 10-Q for the fiscal quarterly period ended
               June 27, 1992.
10.(ii)(F)     Amendment dated May 23, 1992 to Letter Agreement
               dated June 24, 1988 (Signature Credit Agreement) by
               and among Signature Financial/Marketing, Inc.,
               Montgomery Ward & Co., Incorporated and Montgomery
               Ward Credit Corporation, incorporated by reference
               to Exhibit 10.(ii)(F) of the Company's Quarterly
               Report on Form 10-Q for the fiscal quarterly period
               ended June 27, 1992.
10.(ii)(G)     Letter Agreement dated December 29, 1992 by and
               between Montgomery Ward & Co., Incorporated and
               Montgomery Ward Credit Corporation, incorporated by
               reference to Exhibit 10.(ii)(G) of the Company's
               Annual Report on Form 10-K for the fiscal year
               ended January 2, 1993.
<PAGE>
Item 14. Exhibits, Financial Statement Schedules, and Reports on
         Form 8-K. (Continued)

   3.  Exhibits (continued)

10.(ii)(G)(1) Letter Agreement dated April 29, 1993, by and
              between Montgomery Ward Credit Corporation and
              Montgomery Ward & Co., Incorporated, incorporated
              by reference to Exhibit 10.(ii)(H) of the Company's
              Quarterly Report on Form 10-Q for the fiscal
              quarterly period ended April 3, 1993.
10.(ii)(G)(2) Letter Agreement dated September 15, 1993, by and
              between Montgomery Ward Credit Corporation and
              Montgomery Ward & Co., Incorporated, incorporated
              by reference to Exhibit 10.(ii)(G)(2) of the
              Company's Annual Report on Form 10-K for the fiscal
              year ended January 1, 1994.
10.(ii)(H)     Ninth Amendment to Account Purchase Agreement dated
               February 16, 1994 by and between Montgomery Ward &
               Co., Incorporated and Montgomery Ward Credit
               Corporation, incorporated by reference to Exhibit
               10.(ii)(H) of the Company's Annual Report on form
               10-K for the fiscal year ended January 1, 1994.
10.(ii)(I)     Tenth Amendment to Account Purchase Agreement dated
               June 16, 1994, by and between Montgomery Ward
               Credit Corporation and Montgomery Ward & Co.,
               Incorporated, incorporated by reference to Exhibit
               10.(ii)(B)(11) of the Company's Registration
               Statement on Form S-1 (No. 33-33252).
10.(ii)(J)     Second Amendment dated June 16, 1994 to Signature
               Credit Agreement by and among Signature
               Financial/Marketing, Inc., Montgomery Ward & Co.,
               Incorporated and Montgomery Ward Credit
               Corporation, incorporated by reference to Exhibit
               10.(ii)(C)(2) of the Company's Registration
               Statement on Form S-1 (No. 33-33252).
10.(ii)(K)     Eleventh Amendment to the Account Purchase
               Agreement dated January 1, 1994, by and between
               Montgomery Ward Credit Corporation and Montgomery
               Ward & Co., Incorporated, incorporated by reference
               to the Company's Annual Report on Form 10-K for the
               fiscal year ended December 31, 1994.
10.(iv)(A)     Montgomery Ward & Co., Incorporated Stock Ownership
               Plan, amended and restated as of May 20, 1994,
               incorporated by reference to Exhibit
               10.(iv)(A)(ii)(A) of the Company's Registration
               Statement on Form S-1 (No. 33-33252).
10.(iv)(A)(1) Amendment No. 1 to the Amended and Restated
              Montgomery Ward & Co. Stock Ownership Plan dated
              October 20, 1994, incorporated by reference to
              Exhibit 10.(iv)(A)(iii) of the Company's Quarterly
              Report on Form 10-Q for the fiscal quarterly period
              ended October 1, 1994. 
<PAGE>
Item 14. Exhibits, Financial Statement Schedules, and Reports on
         Form 8-K. (Continued)

   3.  Exhibits (continued)

10.(iv)(B)     Montgomery Ward & Co., Incorporated Long Term
               Incentive Plan, incorporated by reference to
               Exhibit 10.(iv)(B) of the Company's Registration
               Statement on Form S-1 (Registration No. 33-23403).
10.(iv)(B)(i) Montgomery Ward & Co., Incorporated Executive Long-
              Term Incentive Plan, incorporated by reference to
              Exhibit 10.(iv)(B)(1) of the Company's Registration
              Statement on Form S-1 (No. 33-33252).
10.(iv)(C)     Montgomery Ward & Co., Incorporated Performance
               Management Program, incorporated by reference to
               Exhibit 10.(iv)(C) of the Company's Registration
               Statement on Form S-1 (Registration No. 33-23403).
10.(iv)(C)(i) Montgomery Ward & Co., Incorporated Senior
              Executive Performance Management Program,
              incorporated by reference to Exhibit 10.(iv)(C)(i)
              of the Company's Registration Statement on Form S-1
              (No. 33-33252).
10.(iv)(D)     Montgomery Ward & Co., Incorporated Retirement
               Security Plan (as amended and restated effective as
               of January 1, 1994), incorporated by reference to
               the Company's Annual Report on Form 10-K for the
               fiscal year ended December 31, 1994.
10.(iv)(E)     Montgomery Ward & Co., Incorporated Supplemental
               Retirement Plan, incorporated by reference to
               Exhibit 10.(iv)(E) of the Company's Registration
               Statement on Form S-1 (Registration No. 33-23403).
10.(iv)(F)     Montgomery Ward Holding Corp. Directors Fee and
               Stock Ownership Plan, incorporated by reference to
               Exhibit 10.(iv)(F) of the Company's Registration
               Statement on Form S-1 (Registration No. 33-41161).
10.(iv)(G)     Montgomery Ward Holding Corp. Senior Officer
               Severance Plan, incorporated by reference to
               Exhibit 10.(iv)(G) of the Company's Annual Report
               on Form 10-K for the fiscal year ended January 2,
               1993.
10.(iv)(H)     Montgomery Ward & Co., Incorporated Savings and
               Profit Sharing Plan (as amended and restated as of
               January 1, 1994), incorporated by reference to the
               Company's Annual Report on Form 10-K for the fiscal
               year ended December 31, 1994.
10.(iv)(I)     Montgomery Ward & Co., Incorporated Success Plan,
               incorporated by reference to Exhibit 10.(iv)(I) of
               the Company's Registration Statement on Form S-1
               (No. 33-33252).
10.(vi)       Employment Agreement effective January 14, 1994
              between Montgomery Ward & Co., Incorporated and
              Bernard W. Andrews, incorporated by reference to
              Exhibit 10.(vi) of the Company's Annual Report on
              Form 10-K for the fiscal year ended January 1,
              1994.
<PAGE>
Item 14. Exhibits, Financial Statement Schedules, and Reports on
         Form 8-K. (Continued)

   3.  Exhibits (continued)

10.(vii)      Agreement effective October 21, 1991 between
              Montgomery Ward & Co., Incorporated and Fingerhut
              Companies, Inc., incorporated by reference to
              Exhibit 10.(vii) of the Company's Annual Report on
              Form 10-K for the fiscal year ended December 28,
              1991.
10.(viii)      Line of Credit Agreement effective November 19,
               1991 between Montgomery Ward & Co., Incorporated
               and The Northern Trust Company and The First
               National Bank of Chicago, incorporated by reference
               to Exhibit 10.(viii) of the Company's Annual Report
               on Form 10-K for the fiscal year ended December 28,
               1991.
10.(ix)       Employment Agreement effective December 31, 1993
              between Montgomery Ward & Co., Incorporated and
              Robert F. Connolly, incorporated by reference to
              Exhibit 10.(ix) of the Company's Annual Report on
              Form 10-K for the fiscal year ended January 1,
              1994.  
10.(xi)       Employment Agreement dated March 1, 1994 between
              Montgomery Ward & Co., Incorporated and Richard
              Bergel, incorporated by reference to Exhibit
              10.(xi)(A) of the Company's Registration Statement
              on Form S-1 (No. 33-33252).
10.(xii)      Employment Agreement effective April 12, 1994
              between Montgomery Ward & Co., Incorporated, and G.
              Joseph Reddington, incorporated by reference to
              Exhibit 10.(xii) of the Company's Annual Report on
              Form 10-K for the fiscal year ended December 31,
              1994.
11.           Statement regarding computation of per share
              earnings.
12.           Not applicable.
13.           Not applicable.
16.           Not applicable.
18.           Not applicable.
19.           Not applicable.
21.           Subsidiaries of the Registrant, incorporated by
              reference to Exhibit 21 of the Company's
              Registration Statement on Form S-1 (Registration
              No. 33-33252).
22.           Not applicable.
23.           Consent of independent public accountants.
24.           Powers of attorney executed by directors and
              officers authorizing execution of Annual Report on
              Form 10-K.
27.           Financial data schedule.
28.           Not applicable.
<PAGE>
Item 14. Exhibits, Financial Statement Schedules, and Reports on
         Form 8-K. (Continued)

   3.  Exhibits (continued)


(b) Reports on Form 8-K.

     On September 13, 1995, the Registrant filed a Form 8-K to
communicate its intention to acquire Levitz Furniture Incorporated. 
The press release issued jointly by Montgomery Ward & Co.,
Incorporated and Levitz Furniture Incorporated on September 5, 1995
was included as an exhibit thereto.

     On October 18, 1995, the Registrant filed a Form 8-K to
communicate the termination of discussions regarding its proposed
purchase of Levitz Furniture Incorporated.  The press release
issued jointly by Montgomery Ward & Co., Incorporated and Levitz
Furniture Incorporated on October 16, 1995 was included as an
exhibit thereto.

     On November 13, 1995, the Registrant filed a Form 8-K to
communicate the intent of Signature Financial/Marketing, Inc., a
wholly-owned subsidiary of Montgomery Ward & Co., Incorporated,
which is, in turn, a wholly-owned subsidiary of Montgomery Ward
Holding Corp., to acquire Amoco Enterprises, Inc., operator of the
Amoco Motor Club.  Amoco Enterprises, Inc. is a wholly-owned
subsidiary of Amoco Oil Holding Company.
<PAGE>
                                SIGNATURES


 Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant, Montgomery Ward
Holding Corp., has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

REGISTRANT              MONTGOMERY WARD HOLDING CORP.


BY                 JOHN L. WORKMAN     
NAME AND TITLE     John L. Workman, Executive Vice President,
                   Chief Financial Officer and Assistant Secretary
DATE               March 29, 1996

 Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the date
indicated.


BY                 SPENCER H. HEINE
NAME AND TITLE     Bernard F. Brennan*, Director, Chairman of the
                   Board and Principal Executive Officer
DATE               March 29, 1996


BY                 SPENCER H. HEINE
NAME AND TITLE     Spencer H. Heine, Executive Vice President,
                   Secretary, General Counsel and Director
DATE               March 29, 1996


BY                 SPENCER H. HEINE
NAME AND TITLE     G. Joseph Reddington*, Director
DATE               March 29, 1996


BY                 JOHN L. WORKMAN     
NAME AND TITLE     John L. Workman, Executive Vice President,
                   Chief Financial Officer and Assistant Secretary
DATE               March 29, 1996


BY                 SPENCER H. HEINE
NAME AND TITLE     Myron Lieberman*, Director
DATE               March 29, 1996

<PAGE>
                                SIGNATURES



BY                 SPENCER H. HEINE
NAME AND TITLE     Silas S. Cathcart*, Director
DATE               March 29, 1996


BY                 SPENCER H. HEINE
NAME AND TITLE     Denis J. Nayden*, Director
DATE               March 29, 1996


BY                 SPENCER H. HEINE
NAME AND TITLE     James A. Parke*, Director
DATE               March 29, 1996


BY                 SPENCER H. HEINE
NAME AND TITLE     Daniel W. Porter*, Director
DATE               March 29, 1996






* by power of attorney
   

<PAGE>

                      EXHIBIT INDEX

EXHIBIT                                     SUBMISSION MEDIA
-------                                     ----------------------
2.(i)(A)      Agreement and Plan       Incorporated by
              of Merger dated March    reference to
              17, 1994 by and among    Exhibit 2.(i)(A) of the 
              Montgomery Ward          Company's Annual Report
              & Co., Incorporated,     on Form 10-K for the
              MW Merger Corp., LMR     fiscal year ended
              Acquisition Corporation, January 1, 1994.
              Lechmere, Inc. and 
              stockholders of LMR
              Acquisition Corporation
              executing counterparts
              of this agreement.  

2.(i)(A)(1)   First Amendment to       Incorporated by
              Agreement and Plan of    reference to
              Merger dated June 15,    Exhibit 2.(i)(A)(1) 
              1994, by and among       of the Company's
              Montgomery Ward & Co.,   Quarterly Report
              Incorporated, LMR        on Form 10-Q for    
              Acquisition Corporation, the fiscal quarterly
              and the Stockholders'    period ended July 2,
              Committee.               1994.

2.(ii)        Agreement of Purchase    Incorporated by
              and Sale of Stock        reference to
              dated February 24, 1994  Exhibit 2.(i)(A)
              by and among Signature   of the Company's
              Financial/Marketing,     Annual Report on
              Inc., Greater California Form 10-K for the
              Dental Services Plan,    fiscal year ended
              Inc. and National        January 1, 1994.
              Dental Services, Inc.

3.1           Third Restated           Incorporated by 
              Certificate of           reference to  
              Incorporation of         Exhibit 3.2(ii) of the
              Registrant, filed        Company's Registration 
              June 28, 1994.           Statement on Form S-1
                                       (Registration No.
                                       33-33252).

3.1(i)        Certificate of           Incorporated by          
              Amendment to             reference to Exhibit
              Certificate of           3.2(iv) of the Company's
              Incorporation of         Quarterly Report on
              Montgomery Ward Holding  Form 10-Q for the fiscal
              Corp. dated October      quarterly period ended
              25, 1994.                October 1, 1994.
<PAGE>
                               EXHIBIT INDEX


EXHIBIT                                     SUBMISSION MEDIA
-------------                            ----------------------

3.3           Amended and Restated     
              By-laws of Registrant,   
              dated as of December     
              29, 1994.                
                                       

9.            Voting Trust             Incorporated by 
              Agreement dated as       reference to
              of June 21, 1988.        Exhibit 3(a) of the
                                       Company's Registration
                                       Statement on Form S-1
                                       (Registration No.
                                       33-23403).

9.(i)         Voting Trust Agreement   Incorporated by     
              dated as of October 21,  reference to Exhibit
              1994.                    9.(i) of the Company's
                                       Quarterly Report on
                                       Form 10-Q for the fiscal
                                       quarterly period ended
                                       October 1, 1994.

10.(i)(A)(1)  Stockholders' Agreement  Incorporated by 
              dated June 17, 1988,     reference to Exhibit 
              as amended and           4.(e) to the Company's
              restated as of           Registration
              December 29, 1994.       Statement on Form S-8 
                                       (Registration No.
                                       33-57075).

10.(i)(A)(3)  Montgomery Ward          Incorporated by 
              & Co., Incorporated      reference to Exhibit
              Stock Ownership          4.(f) of the Company's 
              Plan Terms and           Registration
              Conditions, as           Statement on Form S-8
              amended and              (Registration No.
              restated, as of          33-57075).
              December 29, 1994.

<PAGE>
                               EXHIBIT INDEX


EXHIBIT                                          SUBMISSION MEDIA
-------------                               ----------------------

10.(i)(B)         Stock Purchase       Incorporated by
                  Agreement dated      reference to Exhibit
                  March 6, 1988        10.(i)(B) of the
                  between Mobil        Company's Registration
                  Corporation,         Statement on Form S-1
                  Marcor Inc. and      (Registration No.
                  BFB Acquisition      33-23403).
                  Corp.           

10.(i)(C)         Subscription        
                  Agreement dated
                  as of December 29,   
                  1995 between 
                  General Electric
                  Capital Corporation,
                  Montgomery Ward & 
                  Co., Incorporated,
                  Montgomery Ward
                  Holding Corp., and
                  Bernard F. Brennan.       
                                  
10.(i)(F)         Note Purchase        Incorporated by
                  Agreements dated     reference to Exhibit
                  March 1, 1993        10.(i)(F) of the  
                  between Montgomery   Company's Annual
                  Ward & Co., Incor-   Report on Form 10-K
                  porated and various  for the fiscal year
                  lenders.             ended January 2, 1993.

10.(i)(F)(1)      Amendment dated      Incorporated by 
                  June 30, 1995 to     reference to Exhibit
                  Note Purchase        10.(i)(F)(1) of the
                  Agreements dated     Company's Quarterly
                  March 1, 1993        Report on Form 10-Q
                  between Montgomery   for the fiscal quar-
                  Ward & Co., Incor-   terly period ended
                  porated and various  July 1, 1995.
                  lenders.
<PAGE>
                               EXHIBIT INDEX


EXHIBIT                                SUBMISSION MEDIA
-------------                          ----------------------

10.(i)(H)     Long Term Credit         Incorporated by          
              Agreement dated as of    reference to Exhibit
              September 15, 1994       10.(i)(G) of the 
              among Montgomery Ward    Company's Quarterly
              & Co., Incorporated,     Report on Form 10-Q
              various banks, The       for the fiscal quarterly
              First National Bank      period ended October 1,
              of Chicago, as Docu-     1994.
              mentary Agent, The       
              Bank of Nova Scotia,     
              as Administrative        
              Agent, The Bank of       
              New York, as Negotiated  
              Loan Agent and Bank of   
              America National Trust   
              and Savings Association, 
              as Advisory Agent.       

10.(i)(H)(1)  Amended Schedule 1 to    Incorporated by
              the Long Term Credit     reference to Exhibit
              Agreement dated as of    10.(i)(H)(1) of the 
              September 15, 1994       Company's Quarterly
              among Montgomery Ward    Report on Form 10-Q,
              & Co., Incorporated,     for the fiscal quar-
              various banks, The       terly period ended 
              First National Bank      September 30, 1995.
              of Chicago, as Docu      
              mentary Agent, The       
              Bank of Nova Scotia,     
              as Administrative   
              Agent, The Bank of
              New York, as Negotiated
              Loan Agent and Bank of
              America National Trust
              and Savings Association,
              as Advisory Agent.

<PAGE>
                               EXHIBIT INDEX


EXHIBIT                                 SUBMISSION MEDIA
-------------                        ----------------------

10.(i)(I)     Short Term Credit        Incorporated by          
              Agreement dated as of    reference to Exhibit
              September 15, 1994       10.(i)(H) of the 
              among Montgomery Ward    Company's Quarterly
              & Co., Incorporated,     Report on Form 10-Q 
              various banks, The       for the fiscal quarterly
              First National Bank      period ended October 1, 
              of Chicago, as Docu-     1994.
              mentary Agent, The Bank  
              of Nova Scotia, as       
              Administrative Agent,    
              The Bank of New York,    
              as Negotiated Loan 
              Agent and Bank of 
              America National Trust
              and Savings Association,
              as Advisory Agent.

10.(i)(I)(1)  Amended Schedule 1 to    Incorporated by     
              the Short Term Credit    reference to Exhibit
              Agreement dated as of    10.(i)(I)(1) of the
              September 15, 1994       Company's Quarterly
              among Montgomery Ward    Report on Form 10-Q
              & Co., Incorporated,     for the fiscal 
              various banks, The       quarterly period
              First National Bank      ended September 30,
              of Chicago, as Docu-     1995.
              mentary Agent, The  
              Bank of Nova Scotia,     
              as Administrative   
              Agent, the Bank of       
              New York, as Negotiated  
              Loan Agent and Bank of
              America National Trust   
              and Savings Association,
              as Advisory Agent. 

10.(i)(J)     Note Purchase Agree-     Incorporated by
              ment dated July 11,      reference to Exhibit
              1995 between Montgomery  10.(i)(J) on the 
              Ward & Co., Incorporated Company's Quarterly
              and various lenders.     Report on Form 10-Q
                                       for the fiscal 
                                       quarterly period 
                                       ended July 1, 1995.
<PAGE>
                               EXHIBIT INDEX


EXHIBIT                                 SUBMISSION MEDIA
-------------                          ----------------------

10.(i)(K)     Term Loan Agreement      Incorporated by          
              dated as of September    reference to Exhibit
              29, 1995 between         10.(i)(K) of the
              Montgomery Ward & Co.,   Company's Quarterly
              Incorporated and The     Report on Form 10-Q
              Industrial Bank of       for the fiscal quar-
              Japan, Limited,          terly period ended
              Chicago Branch.          September 30, 1995.
         
10.(ii)(A)    Stock Purchase           Incorporated by
              Agreement dated          reference to Exhibit
              June 22, 1988            10.(ii)(A) of the
              between General          Company's Registration
              Electric Capital         Statement on Form S-1
              Corporation and          (Registration No.
              Montgomery Ward           33-23403).
              & Co., Incorporated.

10.(ii)(B)    Account Purchase         Incorporated by
              Agreement dated          reference to Exhibit
              June 24, 1988            10.(ii)(B) of the
              by and between           Company's Registration
              Montgomery Ward          Statement on Form S-1
              Credit Corporation       (Registration No.
              and Montgomery            33-23403).
              Ward & Co.,         
              Incorporated.        
                                                      
10.(ii)(B)(1) Letter Agreement         Incorporated by
              dated April 21,          reference to Exhibit
              1989 by and between      10.(ii)(B)(1) of the
              Montgomery Ward          Company's Registration
              Credit Corporation       Statement on Form S-1
              and Montgomery           (Registration No. 
              Ward & Co., Incor-       33-33252).
              porated (amending
              the Account Purchase
              Agreement which is
              Exhibit 10.(ii)(B)
              hereto).

<PAGE>
                               EXHIBIT INDEX

EXHIBIT                                SUBMISSION MEDIA
-------------                          ----------------------

10.(ii)(B)(2) Amendment to             Incorporated by 
              Account Purchase         reference to Exhibit
              Agreement dated          10.(ii)(B)(2) of the 
              December 26, 1989 by     Company's Registration
              and between              Statement on Form S-1
              Montgomery Ward          (Registration No.
              Credit Corporation       33-33252).
              and Montgomery Ward &
              Co., Incorporated.

10.(ii)(B)(3) Letter Agreement         Incorporated by
              dated April 24,          reference to Exhibit     
              1990, by and between     10.(ii)(B)(3) of the
              Montgomery Ward          Company's Registration
              Credit Corporation       Statement on Form S-1
              and Montgomery Ward      (Registration No.
              & Co., Incorporated.     33-33252).

10.(ii)(C)    Letter Agreement         Incorporated by
              dated June 24,           reference to Exhibit
              1988 among Signa-        10.(ii)(C) of the
              ture Financial/          Company's Registration
              Marketing, Inc.,         Statement on Form S-1
              Montgomery Ward          (Registration No.
              Credit Corpora-          33-23403).
              tion and Montgomery 
              Ward & Co., Incor-
              porated.
 
10.(ii)(D)    Letter Agreement         Incorporated by
              dated December 26,       reference to Exhibit
              1990, by and between     10.(ii)(D) of the
              Montgomery Ward          Company's Annual
              Credit Corporation       Report on Form 10-K
              and Montgomery           for the fiscal year
              Ward & Co., Incor-       ended December 29,
              porated.                 1990.

10.(ii)(E)    Fifth Amendment to       Incorporated by
              Account Purchase         reference to Exhibit
              Agreement dated          10.(ii)(E) of the
              May 23, 1992 by and      Company's Quarterly
              between Montgomery       Report on Form 10-Q
              Ward & Co., Incor-       for the fiscal
              porated and Mont-        quarterly period ended
              gomery Ward Credit       June 27, 1992.
              Corporation.
<PAGE>
                               EXHIBIT INDEX


EXHIBIT                                 SUBMISSION MEDIA
-------------                          ----------------------

10.(ii)(F)    Amendment dated          Incorporated by
              May 23, 1992 to          reference to Exhibit
              Letter Amendment         10.(ii)(F) of the
              dated June 24,           Company's Quarterly
              1988 (Signature          Report on Form 10-Q
              Credit Agreement)        for the fiscal 
              by and among             quarterly period ended
              Signature Financial/     June 27, 1992.
              Marketing, Inc.,    
              Montgomery Ward
              & Co., Incorporated
              and Montgomery Ward
              Credit Corporation.

10.(ii)(G)    Letter Agreement         Incorporated by 
              dated December 29,       reference to Exhibit
              1992 by and between      10.(ii)(G) of the 
              Montgomery Ward          Company's Annual
              & Co., Incorporated      Report on Form 10-K
              and Montgomery           for the fiscal year
              Ward Credit Corpora-     ended January 2, 
              tion.                    1993.

10.(ii)(G)(1) Letter Agreement         Incorporated by
              dated April 29,          reference to
              1993, by and             Exhibit 10.(ii)(H)
              between Montgomery       of the Company's
              Ward Credit Corpora-     quarterly report on
              tion and Montgomery      Form 10-Q for the 
              Ward & Co., Incor-       fiscal quarterly
              porated.                 period ended April 3,
                                       1993.          

10.(ii)(G)(2) Letter Agreement         Incorporated by
              dated September 15,      reference to
              1993, by and             Exhibit 10.(ii)(G)(2)
              between Montgomery       of the Company's
              Ward Credit Corpora-     Annual Report on 
              tion and Montgomery      Form 10-K for the
              Ward & Co., Incor-       fiscal year ended
              porated.                 January 1, 1994.

<PAGE>
                               EXHIBIT INDEX


EXHIBIT                              SUBMISSION MEDIA
------------                         ----------------------
                                  
10.(ii)(H)    Ninth Amendment to       Incorporated by
              Account Purchase         reference to
              Agreement dated          Exhibit 10.(ii)(H)
              February 16, 1994        of the Company's
              by and between           Annual Report on 
              Montgomery Ward &        Form 10-K for the 
              Co., Incorporated        fiscal year ended
              and Montgomery           January 1, 1994.
              Ward Credit
              Corporation.

10.(ii)(I)    Tenth Amendment to       Incorporated by          
              Account Purchase         reference to Exhibit
              Agreement dated June     10.(ii)(B)(11) of the
              16, 1994, by and         Company's Registration
              between Montgomery       Statement on Form S-1
              Ward Credit Corporation  (No. 33-33252). 
              and Montgomery Ward &    
              Co., Incorporated.       

10.(ii)(J)    Second Amendment         Incorporated by          
              dated June 16, 1994      reference to Exhibit
              to Signature Credit      10.(ii)(C)(2) of the
              Agreement by and         Company's Registration
              among Signature          Statement on Form S-1
              Financial/Marketing,     (No. 33-33252).
              Inc., Montgomery Ward    
              & Co., Incorporated 
              and Montgomery Ward      
              Credit Corporation.

10.(ii)(K)    Eleventh Amendment to    Incorporated by     
              the Account Purchase     reference to 
              Agreement dated          the Company's
              January 1, 1994, by      Annual Report on
              and between Montgomery   Form 10-K for the
              Ward Credit Corporation  fiscal year ended
              and Montgomery Ward &    December 31, 1994.
              Co., Incorporated.

10.(iv)(A)    Montgomery Ward          Incorporated by
              & Co., Incorporated      reference to Exhibit
              Stock Ownership          10.(iv)(A)(ii)(A) of 
              Plan, amended and        the Company's
              restated as of           Registration Statement
              May 20, 1994.            on Form S-1 (No. 33-33252).
<PAGE>
                               EXHIBIT INDEX


EXHIBIT                                 SUBMISSION MEDIA
-------------                          ----------------------
                                  
10.(iv)(A)(1) Amendment No. 1 to       Incorporated by          
              the Amended and          reference to Exhibit
              Restated Montgomery      10.(iv)(A)(iii) of the 
              Ward & Co. Stock         Company's Quarterly
              Ownership Plan dated     Report on Form 10-Q
              October 20, 1994.        for the fiscal quarterly
                                       period ended October 1,
                                       1994.

10.(iv)(B)    Montgomery Ward          Incorporated by
              & Co., Incorporated      reference to Exhibit
              Long Term Incentive      10.(iv)(B) of the
              Plan.                    Company's Registration
                                       Statement on Form S-1
                                       (Registration No.
                                        33-23403).

10.(iv)(B)(i) Montgomery Ward & Co.,   Incorporated by     
              Incorporated Executive   reference to Exhibit
              Long-Term Incentive      10.(iv)(B)(1) of the
              Plan.                    Company's Registration
                                       Statement on Form S-1
                                       (Registration No.
                                       33-33252).

10.(iv)(C)    Montgomery Ward          Incorporated by
              & Co., Incorporated      reference to Exhibit 
              Performance              10.(iv)(C) of the
              Management Program.      Company's Registration
                                       Statement on Form S-1
                                       (Registration
                                       No. 33-23403).

10.(iv)(C)(i) Montgomery Ward & Co.,   Incorporated by
              Incorporated Senior      reference to Exhibit
              Executive Performance    10.(iv)(C)(i) of the
              Management Program.      Company's Registration
                                       Statement on Form S-1
                                       (Registration No.
                                       33-33252).

<PAGE>
                               EXHIBIT INDEX


EXHIBIT                                SUBMISSION MEDIA
-------------                         ----------------------

10.(iv)(D)    Montgomery Ward          Incorporated by 
              & Co., Incorporated      reference to the
              Retirement Security      Company's Annual Report
              Plan (as amended         on Form 10-K for the     
              and restated             fiscal year ended 
              effective as of          December 31, 1994.
              January 1, 1994).        

10.(iv)(E)    Montgomery Ward          Incorporated by
              & Co., Incorporated      reference to Exhibit 
              Supplemental             10.(iv)(E) of the
              Retirement Plan.         Company's Registration
                                       Statement on Form S-1
                                       (Registration No.
                                       33-23403).

10.(iv)(F)    Montgomery Ward          Incorporated by
              Holding Corp.            reference to Exhibit
              Directors Fee            10.(iv)(F) of the
              and Stock Owner-         Company's Registration
              ship Plan.               Statement on Form S-1
                                       (Registration No.
                                       33-41161).

10.(iv)(G)    Montgomery Ward          Incorporated by
              Holding Corp.            reference to Exhibit
              Senior Officer           10.(iv)(G) of the
              Severance Plan.          Company's Annual
                                       Report on Form 10-K
                                       for the fiscal year
                                       ended January 2, 1993.

10.(iv)(H)    Montgomery Ward & Co.,   Incorporated by          
              Incorporated Savings     reference to the
              and Profit Sharing       Company's Annual Report
              Plan (as amended and     on Form 10-K for the 
              restated as of January   fiscal year ended
              1, 1994).                December 31, 1994.
                                       
10.(iv)(I)    Montgomery Ward & Co.,   Incorporated by reference
              Incorporated Success     to Exhibit 10.(iv)(I) of
              Plan.                    the Company's Registration
                                       Statement on Form S-1
                                       (No. 33-33252).

<PAGE>
                               EXHIBIT INDEX
EXHIBIT                                SUBMISSION MEDIA
-------------                          ----------------------

10.(vi)       Employment Agreement     Incorporated by
              effective January        reference to Exhibit
              14, 1994 between         10.(vi) of the Company's 
              Montgomery Ward          Annual Report on Form 
              & Co., Incorporated      10-K for the fiscal
              and Bernard W.           year ended January 1, 
              Andrews.                 1994.

10.(vii)      Agreement effective      Incorporated by 
              October 21, 1991         reference to Exhibit
              between Montgomery       10.(vii) of the 
              Ward & Co., Incor-       Company's Annual
              porated and Finger-      Report on Form 10-K
              hut Companies, Inc.      for the fiscal year
                                       ended December 28,
                                       1991.

10.(viii)     Line of Credit           Incorporated by
              Agreement effective      reference to Exhibit
              November 19, 1991        10.(viii) of the
              by and among Mont-       Company's Annual
              gomery Ward & Co.,       Report on Form 10-K
              Incorporated, The        for the fiscal year
              Northern Trust           ended December 28,
              Company and The          1991.
              First National
              Bank of Chicago.                                   

10.(ix)       Employment Agreement     Incorporated by     
              effective December       reference to Exhibit
              31, 1993 between         10.(ix) of the Company's
              Montgomery Ward &        Annual Report on Form
              Co., Incorporated        10-K for the fiscal year
              and Robert F. Connolly.  ended January 1, 1994.

10.(xi)       Employment Agreement     Incorporated by
              effective March          reference to Exhibit
              1, 1994 between          10.(xi)(A) of the
              Montgomery Ward &        Company's Registration
              Co., Incorporated        Statement on Form S-1
              and Richard Bergel.      (No. 33-33252).
                                       
10.(xii)      Employment Agreement     Incororated by
              effective April 12, 1994 reference to the Company's
              between Montgomery Ward  Annual Report on Form 10-K
              & Co., Incorporated, and for the fiscal year ended
              G. Joseph Reddington.    December 31, 1994.
<PAGE>
                               EXHIBIT INDEX


EXHIBIT                                   SUBMISSION MEDIA
-------------                          ----------------------

11.           Statement regarding
              computation of per
              share earnings.
         
12.           Not applicable.

13.           Not applicable.

16.           Not applicable.

18.           Not applicable.

19.           Not applicable.

21.           Subsidiaries of                Incorporated by
              the Registrant.                reference to Exhibit
                                             21 of the Company's
                                             Registration Statement
                                             on Form S-1
                                             (Registration No.
                                              33-33252).
22.           Not applicable.

23.           Consent of
              independent
              public accountants.

24.           Powers of attorney  
              executed by direc-  
              tors and officers   
              of Registrant       
              authorizing execu-
              tion of Annual
              Report on Form 10-K.     

27.           Financial Data Schedule.

28.           Not applicable.