=================================================================


                          SECURITIES AND EXCHANGE COMMISSION

                                WASHINGTON, D.C. 20549

                                       -------

                                      FORM 10-Q


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


                         FOR THE QUARTER ENDED JUNE 30, 1997

                            COMMISSION FILE NUMBER 0-27190


                           PARAMOUNT FINANCIAL CORPORATION
                (Exact name of Registrant as specified in its charter)


                    DELAWARE                           11-3072768
          (STATE OR OTHER JURISDICTION OF         (I.R.S. EMPLOYER 
          INCORPORATION OR ORGANIZATION)          IDENTIFICATION NO.)



                    ONE JERICHO PLAZA, JERICHO, NEW YORK             11753
                    (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)     (ZIP CODE)


                                    (516) 938-3400
                 (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)


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


                   NUMBER OF SHARES OUTSTANDING AT AUGUST 11, 1997:

             7,950,000 SHARES OF COMMON STOCK, PAR VALUE $0.01 PER SHARE.

          =================================================================

     <PAGE> 

                           PARAMOUNT FINANCIAL CORPORATION

                       INDEX TO FORM 10-Q FOR THE QUARTER ENDED

                                    JUNE 30, 1997





          PART I - FINANCIAL INFORMATION                         Page No.
                                                                   --------

            Item 1 - Financial Statements

                   Consolidated Balance Sheets
                   June 30, 1997 and December 31, 1996  . . . .       1

                   Consolidated Statements of Operations
                   Three Months Ended and Six Months Ended
                   June 30, 1997 and 1996   . . . . . . . . . .       2

                   Consolidated Statement of Changes in Stockholders' 
                   Equity Six Months Ended June 30, 1997  . . .       3

                   Consolidated Statements of Cash Flows
                   Six Months Ended June 30, 1997 and 1996  . .       4

                   Notes to Unaudited Consolidated Financial 
                   Statements . . . . . . . . . . . . . . . . .       5

            Item 2 - Management's Discussion and Analysis of
                     Financial Condition and Results of 
                     Operations . . . . . . . . . . . . . . . .      6-9


          PART II - Other Information . . . . . . . . . . . . .       10


          SIGNATURES  . . . . . . . . . . . . . . . . . . . . .       11


    <PAGE> 


                            PART I:  FINANCIAL INFORMATION

          Item 1.  FINANCIAL STATEMENTS

                   PARAMOUNT FINANCIAL CORPORATION AND SUBSIDIAARY
                   -----------------------------------------------

                             CONSOLIDATED BALANCE SHEETS
                             ---------------------------


                                              DECEMBER 31,     JUNE 30,
                        ASSETS                    1996           1997
                        ------                ------------    -----------
                                                              (UNAUDITED)

           Cash and cash equivalents . . .   $ 3,700,774     $  889,117

           Investments available for sale      3,163,841      4,477,320

           Accounts receivable . . . . . .     2,260,013      4,328,646

           Net investment in direct finance
             and sales-type leases . . . .    20,942,542     34,741,229

           Assets held under operating
             leases, net of accumulated
             depreciation  . . . . . . . .    21,103,033     15,058,155

           Other assets  . . . . . . . . .       391,317        463,409
                                             -----------    -----------

           Total assets  . . . . . . . . .   $51,561,520    $59,957,876
                                              ==========    ===========


           LIABILITIES AND SHAREHOLDERS' EQUITY
           ------------------------------------

           Notes payable . . . . . . . . .   $    18,384    $ 3,595,971

           Accounts payable  . . . . . . .     1,062,226        469,655

           Accounts payable - leases . . .    18,234,518        785,753

           Accrued expenses  . . . . . . .       188,169        211,015

           Obligations for financed
           equipment - non-recourse  . . .    23,461,175     46,151,050

           Deferred income taxes . . . . .       425,662        425,662
                                             -----------    -----------

           Total liabilities . . . . . . .    43,390,134     51,639,106
                                             -----------    -----------

           Shareholders' equity:

           Preferred stock, $.01 par value;
             5,000,000 shares authorized,
             none outstanding  . . . . . .            --             --

           Common stock, $.01 par value;
             35,000,000 shares authorized,
             and 7,990,000 shares issued
             and outstanding . . . . . . .        79,900         79,900

           Additional paid-in capital  . .    13,644,228     13,644,228

           Accumulated deficit . . . . . .    (5,552,742)    (5,406,784)

           Treasury stock, 30,000 shares at
             cost  . . . . . . . . . . . .            --        (18,574)
                                             -----------    -----------

           Total shareholders' equity  . .     8,171,386      8,318,770
                                             -----------    -----------
           Total liabilities and
             shareholders' equity  . . . .   $51,561,520    $59,957,876
                                              ==========    ===========

                   See accompanying notes to financial statements.

					-1-

     <PAGE> 


                    PARAMOUNT FINANCIAL CORPORATION AND SUBSIDIARY
                    ----------------------------------------------
                        CONSOLIDATED STATEMENTS OF OPERATIONS
                        -------------------------------------
                                      UNAUDITED
                                      ----------



                                   THREE MONTHS ENDED         SIX MONTHS ENDED
                                        JUNE 30,                  JUNE 30,
                                   ------------------         ----------------

                                   1996         1997        1996         1997
                                   ----         ----        ----         ----
     REVENUES:

     Sales . . . . . . . . . $21,006,596   $5,814,632   $22,083,893 $6,750,871

     Lease revenue . . . . .     798,769    2,814,018     1,446,371  5,423,365

     Fee, interest and            92,743      280,089       163,271    780,964
     other income  . . . . . -----------   ----------   ----------- ----------

         Total revenues  . .  21,898,108    8,908,739    23,693,535 12,955,200
                              -----------   ----------   ----------- ----------


     COSTS AND EXPENSES:

     Cost of sales . . . . .  20,117,787    5,258,167    21,082,089  6,033,311

     Lease expense . . . . .     792,766    2,741,598     1,352,212  5,190,680

     Selling, general and
     administrative expenses     685,600      784,906     1,144,911  1,487,542
                             -----------   ----------    ---------- ----------

         Total costs and      21,596,153    8,784,671    23,579,212 12,711,533
         expenses  . . . . . -----------   ----------    ---------- ----------

     Income before provision
     for income taxes  . . .     301,955      124,068       114,323    243,667

     PROVISION FOR INCOME        120,783       49,870        45,730     97,709
     TAXES . . . . . . . . . -----------   ----------    ---------- ----------

           Net income  . . .    $181,172      $74,198       $68,593   $145,958
                             ===========   ==========    ========== ==========

           Earnings per            $0.02        $0.01         $0.01      $0.02
           common share  . . ===========   ==========    ========== ==========

     Weighted average common
     shares outstanding  . .    7,990,00    7,982,308     7,628,571  7,986,133
                             ===========   ==========    ========== ==========


                  See accompanying notes to financial statements.


					-2-

     <PAGE> 


                    PARAMOUNT FINANCIAL CORPORATION AND SUBSIDIARY
                    ----------------------------------------------
              CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
              ----------------------------------------------------------
                        FOR THE SIX MONTHS ENDED JUNE 30, 1997
                        --------------------------------------
                                      UNAUDITED
                                      ---------


                                             COMMON STOCK          ADDITIONAL
                                             ------------           PAID-IN-
                                          SHARES       AMOUNT       CAPITAL
                                          ------       ------      ---------


       BALANCE, DECEMBER 31, 1996  .      7,990,000    $79,900    $13,644,228

       Net income  . . . . . . . . .         --            --          --

       Issuance    of    warrants   as
       compensation  . . . . . . . .         --            --          20,000

       Purchase of treasury stock  .         --            --           --   
                                          ---------    -------    -----------

       BALANCE, JUNE 30, 1997  . . .      7,990,000    $79,900    $13,664,228
                                          =========    =======    ===========


                                           ACCUMULATED  TREASURY
                                            (DEFICIT)     STOCK       TOTAL
                                            ----------  --------      -----



      BALANCE, DECEMBER 31, 1996  . . . .  ($5,552,742)  $  --      $8,171,386

      Net income  . . . . . . . . . . . .      145,958      --         145,958

      Issuance of warrants as
      compensation  . . . . . . . . . . .         --        --          20,000

      Purchase of treasury stock  . . . .         --     (18,574)      (18,574)
                                            ----------   -------    ----------
      BALANCE, JUNE 30, 1997  . . . . . .  ($5,406,784) ($18,574)   $8,318,770
                                            ==========   =======    ==========





                   See accompanying notes to financial statements.



					-3-

     <PAGE> 



                    PARAMOUNT FINANCIAL CORPORATION AND SUBSIDIARY
                    ----------------------------------------------
                        CONSOLIDATED STATEMENTS OF CASH FLOWS
                        -------------------------------------
                          FOR THE SIX MONTHS ENDED JUNE 30,
                          ---------------------------------
                                      UNAUDITED
                                      ----------

                                                       1996          1997
                                                       ----          ----
     CASH FLOWS FROM OPERATING ACTIVITIES:

     Net income                                       $68,593        $145,958

     Adjustments to reconcile net income to net cash
        provided by (used in) operating activities:

      Depreciation                                    805,020       3,790,698

      Amortization of discounts on investments        (85,270)        (97,183)

      Compensation charge for warrants issued            --            20,000

      Amortization of unearned operating lease
       revenue from sublease transactions             (19,928)          --

      Amortization of prepaid operating lease
       expense from sublease transactions              25,067           --
   
      Changes in operating assets and liabilities:

               Accounts receivable                   (713,197)     (2,068,633)

               Other assets                           411,436         (72,092)

               Accounts payable                       366,850        (592,571)

               Accrued expenses                       (40,246)         22,846
                                                  -----------     -----------
     Net cash provided by operating activities        818,325       1,149,023
                                                  -----------     -----------


     CASH FLOWS FROM INVESTING ACTIVITIES:

        Purchase of equipment for direct finance 
           leases and sales-type leases           (17,421,075)    (25,381,098)

         Termination of direct finance leases         967,998       4,236,465

         Proceeds applied to direct finance 
           leases and sales-type leases             2,074,645       5,012,761

         Purchase of equipment for operating 
           leases                                 (14,547,245)        (41,333)
  
       Termination of operating leases             12,700,409           --

         Residual value sharing arrangements          --            4,628,698

         Purchases of investments                 (11,184,632)    (10,156,296)
         Proceeds from sale/maturity of 
           investments                              8,833,924       8,940,000
                                                  -----------     -----------
                                                  (18,575,976)    (12,760,803)
     Net cash used in investing activities        -----------     -----------


     CASH FLOWS FROM FINANCING ACTIVITIES:

        Proceeds from sale of common stock in
           an initial public offering, 
           net of fees                             8,398,093          --

        Repurchase of common stock                    --           (18,574)

        Proceeds from notes payable                    --          3,578,697

        Repayment of notes payable               (1,592,829)         (1,110)

        Decrease in amounts due on purchases 
          of equipment for leases                     426,850     (17,448,765)



					-4-

     <PAGE>  



                                                       1996          1997
                                                       ----          ----

        Increase in non-recourse lease financing   27,446,278      32,192,094

        Termination of non-recourse lease 
          financing                              (10,839,734)       (885,700)

        Repayments and interest 
          amortization applied to 
          non-recourse lease financing            (2,869,307)     (8,616,519)
                                                  -----------     -----------

     Net cash provided by financing                20,969,351       8,800,123
       activities                                 -----------     -----------

     Net increase (decrease) in 
       cash and cash equivalents                    3,211,700      (2,811,657)

     CASH AND CASH EQUIVALENTS,                     1,153,476       3,700,774
       beginning of period                        -----------     -----------


     CASH AND CASH EQUIVALENTS,                   $ 4,365,176     $   889,117
       end of period                              ===========     ===========

     SUPPLEMENTAL CASH FLOW INFORMATION:
        Cash paid for income taxes                $    21,746     $    28,210
                                                  ===========     ===========

        Cash paid for interest                    $   523,203     $ 1,328,337
                                                  ===========     ===========





                   See accompanying notes to financial statements.


					-5-

     <PAGE>



                    PARAMOUNT FINANCIAL CORPORATION AND SUBSIDIARY
                    ----------------------------------------------
                 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                 ----------------------------------------------------

          1.   The accompanying unaudited consolidated financial statements
               have been prepared in accordance with the instructions for
               Form 10-Q and Regulation S-X related to interim period
               financial statements and, therefore, do not include all
               information and footnotes required by generally accepted
               accounting principles.  However, in the opinion of
               management, all adjustments (consisting of normal recurring
               adjustments and accruals) considered necessary for a fair
               presentation of the financial position of Paramount
               Financial Corporation and subsidiary (the  Company") at June
               30, 1997 and its results of operations and cash flows for
               the three and six months ended June 30, 1996 and 1997,
               respectively, have been included.  The results of operations
               for the interim periods are not necessarily indicative of
               the results that may be expected for the entire year. 
               Reference should be made to the annual financial statements,
               including footnotes thereto, included in the Company's Form
               10-K for the fiscal year ended December 31, 1996.

          2.   The financial statements for the three and six months ended
               June 30, 1997 are consolidated to include the results of
               Paratech Resources Inc.  All intercompany balances and
               transactions have been eliminated.

          3.   Included in cash and cash equivalents is $600,000 of
               restricted cash pledged as collateral under a letter of
               credit arrangement.

          4.   In the second quarter of 1997, the Company granted a total
               of 165,000 stock options to employees.  The Company shall
               continue to apply the Accounting Principles Board Opinion
               No. 25 and will provide the year end disclosures as required
               under Statement of Financial Accounting Standards No. 123,
                Accounting for Stock-Based Compensation."  In addition, the
               Company also entered into an agreement and issued 400,000
               warrants to a firm for investment banking services.

          5.   In March, 1997, the Financial Accounting Standards Board
               issued Statement of Financial Accounting Standards ( SFAS")
               No. 128  Earnings Per Share."  This statement establishes
               standards for computing and presenting earnings per share
               ( EPS") replacing the presentation of currently required
               Primary EPS with a presentation of Basic EPS.  For entities
               with complex capital structures, the statement requires the
               dual presentation of both Basic EPS and Diluted EPS on the
               face of the statement of earnings.  Under this new standard,
               Basic EPS is computed based on weighted average common
               shares outstanding and contingently issuable shares (which
               satisfy certain conditions) and excludes any potential
               dilution; Diluted EPS reflects potential dilution from the
               exercise or conversion of securities into common stock, or
               from other contracts to issue common stock, and is similar
               to the currently required Fully Diluted EPS.  SFAS 128 is
               effective for financial statements issued for periods ending
               after December 15, 1997, including interim periods, and
               earlier application is not permitted.  When adopted, the
               Company will be required to restate its EPS data for all
               periods presented.  The Company does not expect the impact
               of adoption of this statement to be material to previously
               reported EPS amount.

          6.   Certain prior year amounts have been reclassified to conform
               with the 1997 presentation.

					-6- 

     <PAGE> 


                         MANAGEMENT'S DISCUSSION AND ANALYSIS
                   OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS


             The following discussion and analysis should be read in
          conjunction with and is qualified in its entirety by, the
          unaudited financial statements, including the notes thereto,
          appearing elsewhere in this 10-Q.

          GENERAL

             Paramount Financial Corporation ("Paramount" or the "Company")
          is a comprehensive asset management and information technology
          ("IT") solution provider offering customers a wide range of
          integrated services, including lease finance, IT consulting,
          network design and implementation. 

             The operating results of Paramount are subject to quarterly
          fluctuations resulting from a variety of factors, including new
          product announcements by manufacturers, economic conditions,
          interest rate fluctuations and variations in the mix of leases
          written.  In addition, the Company's sales volume fluctuates
          significantly from quarter to quarter based on the closing date
          and nature of each particular sales transaction.  The mix of
          leases written in a quarter is a result of a combination of
          factors, including changes in customer demands and/or
          requirements, new product announcements, price changes, changes
          in delivery dates, changes in maintenance policies and pricing
          policies of equipment manufacturers and price competition from
          other lessors.  Leasing transactions (other than sales type
          leases), in general, do not provide for significant earnings in
          the month of lease origination.  Instead, revenue, expense and
          profit from lease transactions are recorded over the life of the
          asset and the lease.  Lease revenue and lease expense recognition
          is dependent upon a number of factors, including the term of the
          lease, the accounting classification of the lease (i.e.
          operating, direct finance, or sales type) and the commencement
          date of the lease and the lease financing within a particular
          period.  See "Lease Accounting."  Given the possibility of such
          fluctuations, the Company believes that comparisons of the
          results of its operations for preceding quarters are not
          necessarily meaningful and that the results for one quarter
          should not be relied upon as an indication of future performance.

             During the quarter ended June 30, 1997, the Company continued
          to pursue its primary business strategy of developing a high
          quality portfolio of essential IT equipment on lease to
          relationship based end user customers, while at the same time
          evolving into a total technology solution provider.  The Company
          believes that this strategy will create financial benefits over a
          continuum of time, since, unlike other equipment, IT equipment is
          frequently upgraded and/or enhanced during the term of its lease. 
          As a lessor and solution provider, the Company believes that it
          is well positioned to meet the ever changing needs of its
          customers.

             The results of operations for the three and six months ended
          June 30, 1997 are presented on a consolidated basis including the
          results of Paratech Resources Inc. ("Paratech"), the Company's
          system integration subsidiary, which commenced operations during
          the third quarter of 1996.  The Company believes that the
          addition of Paratech is a major step towards establishing
          Paramount as a total high technology solution provider.  Paratech
          generates revenue from sales of desktop computer and related
          systems and through sales of technical support services.  The
          second quarter of 1997 was a period of significant expansion for
          Paratech, as the Company greatly increased the size of its
          technical, sales and support staff.

             Paramount operates in a highly competitive and rapidly
          changing marketplace.  The Company believes that its ability to
          adapt to changes and to evolve into a valued business partner for
          its customers, offering a complete package of products in the
          high technology area, is a key component to the Company's long
          term growth strategy.

					-7-

     <PAGE> 


          LEASE ACCOUNTING

             In accordance with Statement of Financial Accounting Standard
          No. 13, "Accounting for Leases," the Company classifies its
          leases as either operating leases or direct finance leases.  The
          allocation of income among accounting periods within a lease term
          will vary depending upon the lease classification, as described
          below.

             DIRECT FINANCE LEASES: Direct finance leases transfer
          substantially all benefits and risks of equipment ownership to
          the lessee.  A lease is a direct finance lease if it meets one of
          the following criteria: (1) the lease transfers ownership of the
          equipment to the lessee by the end of the lease term; (2) the
          lease contains a bargain purchase option; (3) the lease term at
          inception is at least 75% of the estimated economic life of the
          leased equipment; or (4) the present value of the minimum lease
          payments is at least 90% of the fair value of the leased 
          equipment at lease inception.

             At lease inception, the cost of equipment under a direct
          finance lease is recorded as "Net investment in direct finance
          leases."  The difference between the gross lease payments
          receivable, plus the estimated residual value of the equipment,
          and the equipment cost is recognized as income over the life of
          the lease using the interest method.

             A lease transaction which meets all of the above criteria, and
          in which the Company has made a dealer's profit, is recorded as a
          sales type lease.  A sales type lease is a type of direct finance
          lease, but one in which the Company recognizes, at lease
          inception, revenue and profit which arises from the difference
          between the fair market value of the leased equipment and its
          acquisition cost.

             OPERATING LEASES: All lease contracts which do not meet the
          criteria of direct finance leases are accounted for as operating
          leases.  Monthly lease payments are recorded as operating lease
          revenue.  Leased equipment is recorded at the Company's cost and
          depreciated on a straight-line basis over the lease term to the
          estimated residual value at the expiration of the lease term. 

             The Company's portfolio of equipment on lease is further
          divided into equipment owned by Paramount and equipment managed
          by Paramount.  As of June 30, 1997, the portfolio of equipment on
          lease owned by Paramount had a combined net book value on the
          balance sheet of $49.8 million and had an original cost basis of
          $67.2 million.  Equipment managed by Paramount is equipment on
          lease to customers of Paramount which was subsequently sold to
          investors, but with respect to which Paramount remains the lessor
          and remarketing agent.  The portfolio of equipment managed by
          Paramount had an original cost of $25.6 million.  Thus, as of
          June 30, 1997, the portfolio of equipment on lease owned and
          managed by Paramount had an original acquisition cost of $92.8
          million.


          RESULTS OF OPERATIONS

          THREE MONTHS ENDED JUNE 30, 1997 COMPARED TO THREE MONTHS ENDED
          JUNE 30, 1996

             The Company recorded pre-tax income of $124,000 for the three
          months ended June 30, 1997, as compared to pre-tax income of
          $302,000 for the comparable period ended June 30, 1996.   Net
          income for the second quarter of 1997 was $74,200, as compared
          with net income of $181,200 for 1996.

             Lease revenue, comprised of rental income from operating
          leases and interest income from direct finance and sales type
          leases, increased by 252.3% to $2.8 million for the three months
          ended June 30, 1997 from $798,800 for the comparable period ended
          June 30, 1996.  Lease expense, which includes depreciation
          expense on operating leases, interest expense on lease financing
          and sublease rent expense, increased by 245.8% to $2.7 million
          for the three months ended June 30, 1997 from $792,800 for the
          three months ended June 30, 1996.  These increases are 

					-8-

     <PAGE> 


          a direct result of the Company's continuing efforts to expand 
          its leasing portfolio.  See "General" and "Lease Accounting."

             For the three months ended June 30, 1997, the Company recorded
          sales revenue of $5.8 million, a decrease of 72.3% over the $21.0
          million recorded during the three months ended June 30, 1996.  Of
          the $21.0 million in sales recorded during the three months ended
          June 30, 1996, $12.5 million was the result of a single
          transaction involving the sale of equipment under an operating
          lease to an investor.  See "General."  During the first half of
          1997, the Company has chosen, wherever practicable, to retain
          title to its equipment under operating leases rather than enter
          into these types of sales.  Of the total sales revenue recorded
          during the second quarter of 1997, approximately $1.0 million was
          contributed by Paratech.  This represents an increase of 100%
          over the first quarter of 1997.   See "General."

             During the three months ended June 30, 1997, the Company
          generated $280,100 in fee, interest and other income, compared to
          $92,700 for the comparable period last year.  The Company
          generates fee income from either the sale of equipment under a
          direct finance lease to an investor or from commissions earned on
          third party lease financing transactions.  These transactions
          generally come about as a result of the Company's relationship
          with other lessors and financial institutions.  The Company
          cannot predict with any certainty the timing and nature of any
          future such transactions.  See "General."  Interest income is
          derived from the investment of the Company's cash balances in
          interest bearing cash accounts, cash equivalents and marketable
          securities during the period ended June 30, 1997.

             Selling, general and administrative expenses ("SG&A") totaled
          $784,900 for the three months ended June 30, 1997, representing
          an increase of 14.5% over the $685,600 recorded during the three
          months ended June 30, 1996.  The increase in SG&A is a result of
          the expansion of the operations of Paratech and the increased
          sales and support staff at the Company.  See "General."   

             The tax provisions of $49,870 for the three months ended June
          30, 1997 and $120,800 for the three months ended June 30, 1996,
          reflect an effective rate of 40% for federal and state taxes

             During the three months ended June 30, 1997, the Company
          entered into new lease transactions totaling $15.3 million of
          equipment cost, all of which were recorded as direct finance
          leases.  This compares with $10.2 million for the three months
          ended June 30, 1996, of which $8.5 million were recorded as
          direct finance leases and $1.6 million were recorded as operating
          leases. See "General" and "Lease Accounting."  During the quarter
          ended June 30, 1997, the Company entered into $11.2 million of
          non-recourse lease financing arrangements, as compared with $7.5
          million for the three months ended June 30, 1996.  See "Liquidity
          and Capital Resources."

          SIX MONTHS ENDED JUNE 30, 1997 COMPARED TO SIX MONTHS ENDED JUNE
          30, 1996

             The Company recorded pre-tax income of $243,700 for the six
          months ended June 30, 1997, as compared to pre-tax income of
          $114,300 for the comparable period ended June 30, 1996.   Net
          income for the first half of 1997 was $146,000, as compared with
          net income of $68,600 for 1996.

             Lease revenue, comprised of rental income from operating
          leases and interest income from direct finance and sales type
          leases, increased by 275.0% to $5.4 million for the six months
          ended June 30, 1997 from $1.4 million for the comparable period
          ended June 30, 1996.  Lease expense, which includes depreciation
          expense on operating leases, interest expense on lease financing
          and sublease rent expense, increased by 283.9% to $5.2 million
          for the six months ended June 30, 1997 from $1.4 for the six
          months ended June 30, 1996.  These increases are a direct result
          of the Company's continuing efforts to expand its leasing
          portfolio.  See  "General" and "Lease Accounting."

             For the six months ended June 30, 1997, the Company recorded
          sales revenue of $6.7 million, a decrease of 69.4% over the $22
          million recorded during the six months ended June 30, 1996.  Of
          the $22 million in sales 

					-9- 

     <PAGE> 


          recorded during the six months ended June 30, 1996, $12.5 million
          was the result of a single transaction involving the sale of 
          equipment under an operating lease to an investor.  See "General." 
          During the first half of 1997, the Company has chosen, wherever 
          practicable, to retain title to its equipment under operating 
          leases rather than enter into these types of sales.  Of the total
          sales revenue recorded during the second quarter of 1997, 
          approximately $1.5 million was contributed by Paratech.  This 
          represents an increase of 200% over the twelve months ended 
          December 31, 1996.   See "General."

             During the six months ended June 30, 1997, the Company
          generated $781,000 in fee, interest and other income, compared to
          $163,300 for the comparable period last year.  The Company
          generates fee income from either the sale of equipment under a
          direct finance lease to an investor or from commissions earned on
          third party lease financing transactions.  These transactions
          generally come about as a result of the Company's relationship
          with other lessors and financial institutions.  The Company
          cannot predict with any certainty the timing and nature of any
          future such transactions.  See "General."  Interest income is
          derived from the investment of the Company's cash balances in
          interest bearing cash accounts, cash equivalents and marketable
          securities during the period ended June 30, 1997.

             Selling, general and administrative expenses ("SG&A") totaled
          $1.5 million for the six months ended June 30, 1997, representing
          an increase of 29.9% over the $1.4 million recorded during the
          six months ended June 30, 1996.  The increase in SG&A is a result
          of the expansion of the operations of Paratech, and the increased
          sales and support staff at the Company.  See "General." 

             The tax provisions of $97,700 for the six months ended June
          30, 1997, and $45,700 for the six months ended June 30, 1996,
          reflect an effective rate of 40% for federal and state taxes

             During the six months ended June 30, 1997, the Company entered
          into new lease transactions totaling $25.4 million of equipment
          cost as compared with $32.0 million for the six months ended June
          30, 1996. See "General" and "Lease Accounting."  During the six
          months ended June 30, 1997, the Company entered into $32.2
          million of non-recourse lease financing arrangements, as compared
          with $27.4 million for the six months ended June 30, 1996.  Non-
          recourse debt entered during the six months ended June 30, 1997
          increased at a faster rate than new lease origination as a result
          of the timing of the closing of certain large lease transactions. 
          Of the total amount of non-recourse debt $13.3 million related to
          leases that commenced in December 1996, but for which the Company
          was not required to pay for the equipment until January 1997. 
          This amount was recorded as accounts payable-leases on the
          Company's December 31, 1996 balance sheet.


          LIQUIDITY AND CAPITAL RESOURCES

             As of June 30, 1997, the Company had $5.4 million in cash,
          cash equivalents and marketable securities, including $600,000 of
          restricted cash pledged as additional collateral under a Letter
          of Credit arrangement.  Substantially all of this amount was
          invested in interest-bearing savings accounts, money market
          accounts established by major commercial banks, or in United
          States Government or other AA rated obligations.  Since
          inception, the Company has been able to cover its SG&A expenses
          from internally generated cash flow and has never had to borrow
          funds to cover such operating expenses.  Although the Company's
          business is subject to monthly and quarterly fluctuations that
          may require the Company to use its cash balances to cover such
          expenses for short periods of time, including for the purchase of
          equipment on lease, the Company does not anticipate having to use
          significant amounts of its cash balances to cover such expenses.

             The Company finances substantially all of its leases by
          discounting the payment streams on a non-recourse basis through
          various banks and financial institutions. Thus, the only cash
          required in these lease transactions is the residual value
          investment by the Company.  The Company believes that it
          currently has sufficient resources to make the residual value
          investments required to grow its lease portfolio.  In addition,
          the Company has numerous options available to it for the
          financing of residual value investments, including sales of
          equipment on lease to equipment 


					-10-


     <PAGE> 

          investors, residual value sharing arrangements, recourse loans 
          and non-recourse loans.  The Company intends to use, on an 
          opportunistic basis, all such available resources in order to 
          maximize its portfolio of equipment on lease.  

             During the six months ended June 30, 1997, the Company entered
          into several residual value sharing and financing arrangements
          with an equipment investor totaling $8.0 million.  This investor
          (i) purchased a portion of the Company's residual value of
          equipment on lease in exchange for the right to share in
          remarketing proceeds generated from the equipment upon lease, and
          (ii) provided recourse financing for the remaining portion of the
          Company's residual value investment.  The equipment on lease and
          the related leases serve as collateral for these financings.  The
          Company expects to repay these loans through the proceeds
          generated from remarketing the subject equipment.  These
          transactions allow the Company to continue to grow and expand its
          lease portfolio without significantly affecting its current cash
          balances. 

             At June 30, 1997, the Company had two lines of credit
          available.  These credit lines allow the Company to borrow up to
          $1.25 million in the aggregate and are secured by equipment and
          contracts to sell or lease that equipment.  Borrowings under
          these lines bear interest at 1% above the prime rate.  In
          addition, one of these lines offers the Company the ability to
          borrow up to $100,000 on an unsecured basis.  The purpose of
          these credit lines is to allow the Company to pay its suppliers
          on a timely basis while waiting for the customer to pay or for
          the non-recourse financing to occur.  During the six months ended
          June 30, 1997, the Company had not borrowed any amounts from
          these lines, and accordingly had nothing outstanding as of June
          30, 1997.  As a result of its cash balances, the Company has been
          able to internally bridge finance its equipment purchases.

             During the six months ended June 30, 1997, the Board of
          Directors of the Company approved a plan that would allow for the
          repurchase of up to $500,000 worth of common stock of the
          Company.  The repurchase program took effect immediately and is
          authorized to continue for a period of two years.  Subject to
          applicable rules, the plan allows the Company to repurchase
          shares at any time during the authorized period in any increments
          it deems appropriate.  As of June 30, 1997, the Company had
          repurchased 30,000 shares for a cash purchase price of $18,600.

          FORWARD LOOKING STATEMENTS AND ASSOCIATED RISK

             Statements contained in this Form 10-Q which are not
          historical facts are forward-looking statements.  The forward-
          looking statements in this Form 10-Q are made pursuant to the
          safe harbor provisions of the Private Securities Litigation
          Reform Act of 1995.  Forward-looking statements made herein
          contain a number of risks and uncertainties that could cause
          actual results to differ materially.  These risks and
          uncertainties include, but are not limited to, the specific
          factors impacting the Company's business discussed under the
          caption "General", as well as increased competition; the
          availability of computer equipment; the ability of the Company to
          expand its operations and attract and retain qualified sales
          representatives experienced in the purchase, sale and lease of
          new and used computer equipment; technological obsolescence of
          the Company's portfolio of computer equipment; and general
          economic conditions.


					-11-
     <PAGE> 



                             PART II:  OTHER INFORMATION


          Item 6.   EXHIBITS AND REPORTS ON FORM 8-K

               (a)  Exhibits.
                    --------

                    27.  Financial Data Schedule.

               (b)  Reports on Form 8-K.
                    -------------------

                    None.


					-12-
     <PAGE>


                                      SIGNATURES


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


                                   PARAMOUNT FINANCIAL CORPORATION



          Date:  August 13, 1997   By:    /s/ Paul Vecker
                                      ----------------------------------
                                      Paul Vecker, Senior Vice President
                                      and Chief Fiancial Officer








					-13-
     <PAGE>

                                    EXHIBIT INDEX

          Exhibit          Description
          -------          -----------

            27             Financial Data Schedule