TEXTAINER FINANCIAL SERVICES CORPORATION
                        650 California Street, 16th Floor
                             San Francisco, CA 94108


May 13, 1997


Securities and Exchange Commission
Washington, DC  20549

Gentlemen:

Pursuant to the  requirements  of the  Securities  Exchange Act of 1934,  we are
submitting  herewith for filing on behalf of Textainer Equipment Income Fund II,
L.P. (the "Company") the Company's  Quarterly  Report on Form 10-Q for the First
Quarter ended March 31, 1997.

This filing is being effected by direct  transmission to the Commission's  EDGAR
System.

Sincerely,

Nadine Forsman
Controller




<PAGE>



                       SECURITIES AND EXCHANGE COMMISSION

                               Washington DC 20549



                                    FORM 10Q



                 QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF
                       THE SECURITIES EXCHANGE ACT OF 1934



                  For the quarterly period ended March 31, 1997


                         Commission file number 0-19145


                    TEXTAINER EQUIPMENT INCOME FUND II, L.P.
             (Exact name of Registrant as specified in its charter)


         California                                             94-3097644
(State or other jurisdiction                                   (IRS Employer
of incorporation or organization)                            Identification No.)

650 California Street, 16th Floor
San Francisco, California                                          94108
(Address of Principal Executive Offices)                        (ZIP Code)

                                 (415) 434-0551
               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 [ ]





<PAGE>




                   TEXTAINER EQUIPMENT INCOME FUND II, L.P.
                      (A California limited partnership)

                      Quarterly Report on Form 10Q for the
                          Quarter Ended March 31, 1997

                                Table of Contents
<TABLE>
<CAPTION>

                                                                                                        Page


          Item 1.  Financial Statements

<S>                <C>                                                                                 <C>
                   Balance Sheets - March 31, 1997 (unaudited) and December 31, 1996....................    3

                   Statements of Earnings for the three months ended
                   March 31, 1997 and 1996 (unaudited)..................................................    4

                   Statements of Partners' Capital for the three months ended
                   March 31, 1997 and 1996 (unaudited)..................................................    5

                   Statements of Cash Flows for the three months
                   ended March 31, 1997 and 1996 (unaudited)............................................    6

                   Notes to Financial Statements (unaudited)............................................    8


          Item 2.  Management's Discussion and Analysis of Financial Condition
                   and Results of Operations............................................................   13



</TABLE>
<PAGE>







                   TEXTAINER EQUIPMENT INCOME FUND II, L.P.
                     (a California limited partnership)

                               Balance Sheets

                     March 31, 1997 and December 31, 1996
                            (Amounts in thousands)

<TABLE>
<CAPTION>

                                                                                1997                   1996
                                                                           ---------------        ---------------
                                                                            (unaudited)
Assets
<S>                                                                      <C>                      <C>
Container rental equipment, net of accumulated
    depreciation of $23,487 (1996:  $21,660)                             $         40,365                 39,408

Cash                                                                                1,578                  1,655

Net investment in direct financing leases (note 7)                                    594                    695

Accounts receivable, net of allowance
    for doubtful accounts of $1,030 (1996:  $1,073)                                 2,880                  3,126
                                                   
Due from affiliates, net (note 5)                                                     447                  1,601
                                 
Prepaid expenses                                                                       19                     25
                                                                           ---------------        ---------------

                                                                         $         45,883                 46,510
                                                                           ===============        ===============
Liabilities and Partners' Capital
Liabilities:
   Accounts payable                                                      $            293                    314

   Accrued liabilities                                                                120                    168
                      
   Accrued damage protection plan costs (note 2)                                      223                    263
                                                
   Warranty claims (note 3)                                                           759                    812
                           
   Equipment purchases payable                                                        761                    426
                                                                           ---------------        ---------------
      Total liabilities
                                                                                    2,156                  1,983
                                                                           ---------------        ---------------

Partners' capital:
   General partners                                                                  (90)                   (90)
                   
   Limited partners                                                                43,817                 44,617
                                                                           ---------------        ---------------

      Total partners' capital                                                      43,727                 44,527
                                                                           ---------------        ---------------

Commitments (note 9)
                                                                         $         45,883                 46,510
                                                                           ===============        ===============
</TABLE>

See accompanying notes to financial statements


<PAGE>



                    TEXTAINER EQUIPMENT INCOME FUND II, L.P.
                       (a California limited partnership)

                            Statements of Earnings

               For the three  months  ended  March 31, 1997 and 1996
        (Dollar amounts in thousands except for unit and per unit amounts)
                                  (unaudited)
<TABLE>
<CAPTION>

                                                                          1997                1996
                                                                     ----------------    ----------------

<S>                                                                <C>                     <C>          
Rental Income                                                      $           2,524       $       3,119
                                                                     ----------------    ----------------

Costs and expenses:
   Direct container expenses                                                     396                 433

   Bad debt benefit                                                              (11)               (146)

   Depreciation                                                                1,007               1,002

   Professional fees                                                               7                   9

   Management fees to affiliates (note 5)                                        237                 279

   General and administrative costs to affiliates (note 5)                       179                 200

   Other general and administrative costs                                         33                  37
                                                                     ----------------    ----------------

                                                                               1,848               1,814
                                                                     ----------------    ----------------

   Income from operations                                                        676               1,305
                                                                     ----------------    ----------------

Other income:
   Interest income                                                                25                  16

   Gain on sale of equipment                                                       6                  97
                                                                     ----------------    ----------------

                                                                                  31                 113
                                                                     ----------------    ----------------

   Net earnings                                                    $             707               1,418
                                                                     ================    ================

Allocation of net earnings (note 5):
   General partners                                                $              15                  16

   Limited partners                                                              692               1,402
                                                                     ----------------    ----------------

                                                                   $             707               1,418
                                                                     ================    ================

Limited partners' per unit share
   of net earnings                                                 $            0.19                0.38
                                                                     ================    ================

Limited partners' per unit share
   of distributions                                                $            0.40                0.40
                                                                     ================    ================

Weighted average number of limited
   partnership units outstanding                                           3,726,977           3,728,623
                                                                     ================    ================
</TABLE>

See accompanying notes to financial statements


<PAGE>



                TEXTAINER EQUIPMENT INCOME FUND II, L.P.
                   (a California limited partnership)

                     Statements of Partners' Capital

           For the three months ended March 31, 1997 and 1996
                          (Amounts in thousands)
                                (unaudited)
<TABLE>
<CAPTION>

                                                                        Partners' Capital
                                                    ----------------------------------------------------------
                                                      General               Limited                Total
                                                    -------------       ----------------       ---------------

<S>                                              <C>                    <C>                    <C>
Balances at January 1, 1996                       $         (90)                 47,855                47,765

Distributions                                               (16)                (1,491)               (1,507)

Redemptions (note 8)                                           -                    (2)                   (2)

Net earnings                                                  16                  1,402                 1,418
                                                    -------------       ----------------       ---------------

Balances at March 31, 1996                        $         (90)                 47,764                47,674
                                                    =============       ================       ===============

Balances at January 1, 1997                       $         (90)                 44,617                44,527

Distributions                                               (15)                (1,491)               (1,506)

Redemptions (note 8)                                           -                    (1)                   (1)

Net Earnings                                                  15                    692                   707
                                                    -------------       ----------------       ---------------

Balances at March 31, 1997                        $         (90)                 43,817                43,727
                                                    =============       ================       ===============

</TABLE>

See accompanying notes to financial statements


<PAGE>



                    TEXTAINER EQUIPMENT INCOME FUND II, L.P.
                       (a California limited partnership)

                            Statements of Cash Flows

               For the three months ended March 31, 1997 and 1996
                             (Amounts in thousands)
                                   (unaudited)
<TABLE>
<CAPTION>

                                                                                         1997              1996
                                                                                     --------------   ---------------
Cash flows from operating activities:
<S>                                                                                <C>                <C>  
   Net earnings                                                                    $           707             1,418

   Adjustments  to  reconcile  net  earnings to net cash  provided by  operating
     activities:
        Depreciation                                                                         1,007             1,002
                                                                                             
        Decrease in allowance for doubtful accounts                                           (43)             (179)

        Gain on sale of equipment                                                              (6)              (97)

        Changes in assets and liabilities:
           Decrease in accounts receivable                                                     289               704

           Proceeds from principal payments of direct financing leases                          69               106

           Decrease in due from affiliates, net                                              1,209                21

           (Decrease) increase in accounts payable and accrued liabilities                    (66)                95

           Decrease in accrued damage protection plan costs                                   (40)              (33)

           Decrease in warranty claims                                                        (53)              (54)

           Decrease in prepaid expenses                                                          6                 8
                                                                                     --------------   ---------------

              Net cash provided by operating activities                                      3,079              2,991
                                                                                     --------------   ---------------

Cash flows from investing activities:
   Proceeds from sale of equipment                                                             486               531

   Equipment purchases                                                                     (2,128)           (1,096)
                                                                                     --------------   ---------------

              Net cash used in investing activities                                        (1,642)             (565)
                                                                                     --------------   ---------------

Cash flows from financing activities:
   Redemptions of limited partnership units                                                    (1)               (2)

   Distributions to partners                                                               (1,513)           (1,504)
                                                                                     --------------   ---------------

              Net cash used in financing activities                                        (1,514)           (1,506)
                                                                                     --------------   ---------------

Net (decrease) increase in cash                                                               (77)               920

Cash at beginning of period                                                                  1,655               489
                                                                                     --------------   ---------------

Cash at end of period                                                              $         1,578             1,409
                                                                                     ==============   ===============

</TABLE>

See accompanying notes to financial statements


<PAGE>



                    TEXTAINER EQUIPMENT INCOME FUND II, L.P.
                       (A California limited partnership)

                       Statements of Cash Flows--Continued

               For the three months ended March 31, 1997 and 1996
                             (Amounts in thousands)
                                   (unaudited)


Supplemental Disclosures:

Supplemental schedule of non-cash investing and financing activities:

The following table summarizes the amounts of Equipment purchases, distributions
to  partners  and  proceeds  from sale of  Equipment  which had not been paid or
received by the Partnership as of March 31, 1997 and 1996, and December 31, 1996
and 1995,  resulting  in  differences  in amounts  recorded  and amounts of cash
disbursed or received by the  Partnership,  as shown in the  Statements  of Cash
Flows for the three-month periods ended March 31, 1997 and 1996.
<TABLE>
<CAPTION>

                                                                  Mar. 31        Dec. 31        Mar. 31     Dec. 31
                                                                     1997           1996           1996        1995
                                                                  -------        -------        -------     -------
Equipment purchases included in:
<S>                                                               <C>            <C>            <C>          <C>
   Due to affiliates..........................................    $    63            27             58           85
   Equipment purchases payable................................        761           426          1,057          400

Distributions to partners included in:
   Due to affiliates..........................................          6            10             67           63
   Accounts payable and accrued liabilities...................         74            77             79           80

Proceeds from sale of Equipment included in:
   Accounts receivable........................................          -             -             54           87
   Due from affiliates........................................        585           498            455          404
</TABLE>

The following table summarizes the amounts of Equipment purchases, distributions
to partners and proceeds from sale of Equipment  recorded by the Partnership and
the amounts  paid or received as shown in the  Statements  of Cash Flows for the
three-month periods ended March 31, 1997 and 1996.
<TABLE>
<CAPTION>

                                                                                                  1997         1996
                                                                                                  ----         ----
<S>                                                                                            <C>             <C>  
Equipment purchases recorded...................................................................$ 2,499         1,726
Equipment purchases paid........................................................................ 2,128         1,096

Distributions to partners declared.............................................................. 1,506         1,507
Distributions to partners paid.................................................................. 1,513         1,504

Proceeds from sale of Equipment recorded........................................................   573           549
Proceeds from sale of Equipment received........................................................   486           531

</TABLE>

See accompanying notes to financial statements


<PAGE>


                   TEXTAINER EQUIPMENT INCOME FUND II, L.P.
                       (A California limited partnership)

                          Notes to Financial Statements

                                 March 31, 1997
            (Dollar amounts in thousands except for per unit amounts)
                                   (unaudited)

Note 1.  General

     Textainer  Equipment Income Fund II, L.P. (the Partnership) is a California
     Limited Partnership formed in 1989. The Partnership owns and leases a fleet
     of  intermodal   marine  cargo  container   equipment  (the  Equipment)  to
     international shipping lines.

     The accompanying  interim  comparative  financial  statements have not been
     audited by an  independent  public  accountant.  However,  all  adjustments
     (which  were only  normal and  recurring  adjustments),  which are,  in the
     opinion of management,  necessary to fairly present the financial  position
     of the  Partnership  as of March 31, 1997 and December  31,  1996,  and the
     results of its operations, changes in partners' capital, and cash flows for
     the three-month periods ended March 31, 1997 and 1996, have been made.

     The financial  information  presented  herein should be read in conjunction
     with the audited financial  statements and the accompanying  Notes included
     in the Partnership's audited financial statements as of December 31, 1996.

     Certain estimates and assumptions were made by the Partnership's management
     that affect the reported  amounts of assets and liabilities and disclosures
     of  contingent  assets  and  liabilities  at  the  date  of  the  financial
     statements  and the  reported  amounts of revenue and  expenses  during the
     reporting period. Actual results could differ from those estimates.

Note 2.  Damage Protection Plan

     The  Partnership  offers a Damage  Protection Plan (the Plan) to lessees of
     its  Equipment.  Under  the  terms  of  the  Plan,  the  Partnership  earns
     additional  revenues on a daily basis and, as a result,  has agreed to bear
     certain repair costs. It is the  Partnership's  policy to recognize revenue
     when earned and to provide a reserve  sufficient to cover the Partnership's
     obligation  for  estimated  future  repair  costs.  At March  31,  1997 and
     December 31, 1996, this reserve was equal to $223 and $263, respectively.


Note 3.  Warranty Claims

     During 1992, 1993 and 1995, the Partnership settled warranty claims against
     an equipment  manufacturer.  The  Partnership  is amortizing the settlement
     amounts  over  the  remaining  estimated  useful  lives  of the  applicable
     Equipment  (between six and seven years),  reducing  maintenance and repair
     costs  over that  time.  At March  31,  1997 and  December  31,  1996,  the
     unamortized  portion of the settlement  amounts was equal to $759 and $812,
     respectively.

Note 4.  Acquisition of Equipment

     During  the  three-month  periods  ended  March  31,  1997  and  1996,  the
     Partnership   purchased  Equipment  with  a  cost  of  $2,499  and  $1,726,
     respectively.


Note 5.  Transactions with Affiliates

     Textainer  Financial  Services  Corporation  (TFS) is the managing  general
     partner of the Partnership.  TFS is a wholly-owned  subsidiary of Textainer
     Capital Corporation (TCC). Textainer Equipment Management Limited (TEM) and
     Textainer  Limited (TL) are associate  general partners of the Partnership.
     The  managing  general  partner  and the  associate  general  partners  are
     collectively  referred to as the General Partners and are commonly owned by
     Textainer Group Holdings  Limited (TGH).  The General  Partners also act in
     this  capacity  for  other  limited  partnerships.   Textainer  Acquisition
     Services  Limited  (TAS) is an  affiliate  of the  General  Partners  which
     performs  services  relative to the  acquisition  of Equipment  outside the
     United  States on behalf of the  Partnership.  TCC  Securities  Corporation
     (TSC),  a licensed  broker and dealer in securities and an affiliate of the
     General  Partners,  was the managing  sales agent for the offering of Units
     for sale.

     In accordance  with the Partnership  Agreement,  and subject to the special
     allocations  described  therein,  net  earnings  or losses and  partnership
     distributions are generally allocated 1% to the General Partners and 99% to
     the limited partners with the exception of gross income,  as defined in the
     Partnership Agreement. Gross income is allocated to the General Partners to
     the extent  that  their  partners'  capital  accounts  deficits  exceed the
     portion of syndication and offering costs allocated to them. On termination
     of the  Partnership,  the General  Partners shall be allocated gross income
     equal to their allocations of syndication and offering costs.

     As part of the operation of the  Partnership,  the Partnership is to pay to
     the General  Partners or TAS an incentive  management  fee, an  acquisition
     fee, an equipment  management fee and an equipment  liquidation  fee. These
     fees  are  for   various   services   provided  in   connection   with  the
     administration   and  management  of  the   Partnership.   The  Partnership
     capitalized $103 and $51 of equipment acquisition fees as part of Equipment
     costs  for  the  three-month   periods  ended  March  31,  1997  and  1996,
     respectively,  and  incurred  $63 of  incentive  management  fees  in  both
     periods. No equipment liquidation fees were incurred in either period.

     The Partnership's  Equipment is managed by TEM. In its role as manager, TEM
     has  authority to acquire,  hold,  manage,  lease,  sell and dispose of the
     Partnership's  Equipment.  Additionally,  TEM holds,  for payment of direct
     operating  expenses,  a  reserve  of cash  that  has  been  collected  from
     container leasing operations;  such cash is included in the amount due from
     affiliates at March 31, 1997 and December 31,1996.

     Subject to certain reductions,  TEM receives a monthly equipment management
     fee equal to 7% of gross lease revenues  attributable  to operating  leases
     and 2% of gross lease revenues  attributable to full payout net leases. For
     the  three-month  periods  ended March 31, 1997 and 1996 these fees totaled
     $174 and $216,  respectively.  The Partnership's Equipment is leased by TEM
     to third party  lessees on operating  master  leases,  spot leases and term
     leases.  The majority of the  Equipment is leased  under  operating  master
     leases with limited terms and no purchase option.

     Certain  indirect  general  and  administrative  costs  such  as  salaries,
     employee  benefits,   taxes  and  insurance,  are  incurred  in  performing
     administrative  services  necessary to the  operation  of the  Partnership.
     These costs are borne by TFS and TEM. During the three-month  periods ended
     March 31, 1997 and 1996,  costs  allocated to the  Partnership for salaries
     were $91 and $98,  respectively and other general and administrative  costs
     were $88 and $102,  respectively.  TEM  allocates  these costs based on the
     ratio of the  Partnership's  interest  in  managed  Equipment  to the total
     Equipment   managed  by  TEM  during  the  period.   Indirect  general  and
     administrative costs allocated to the Partnership by TEM were $157 and $163
     for the three-month periods ended March 31, 1997 and 1996, respectively.

     TFS allocates indirect general and administrative  costs to the Partnership
     based on the ratio of the Partnership's Equipment to the total Equipment of
     all limited partnerships managed by TFS. TFS allocated $22 and $37 of these
     indirect  costs to the  Partnership  during the  three-month  periods ended
     March 31, 1997 and 1996, respectively.

     The General  Partners or TAS may  acquire  Equipment  in their own name and
     hold  title on a  temporary  basis  for the  purpose  of  facilitating  the
     acquisition of such Equipment for the  Partnership.  The Equipment may then
     be resold to the  Partnership  on an all-cash basis at a price equal to the
     actual cost,  as defined in the  Partnership  Agreement.  In addition,  the
     General  Partners  or TAS  are  entitled  to an  acquisition  fee  for  any
     Equipment resold to the Partnership.

     At March 31,  1997 and  December  31,  1996,  due from  affiliates,  net is
     comprised of:
<TABLE>
<CAPTION>

                                                                           1997               1996
                                                                           ----               ----
<S>                                                                       <C>                <C>
                 Due from affiliates:
                     Due from TEM.............................            $ 553              1,665
                                                                           ====              =====

                  Due to affiliates:
                     Due to TFS...............................            $  29                 27
                     Due to TL................................                1                  1
                     Due to TAS...............................               61                 27
                     Due to TCC...............................               15                  9
                                                                           ----              -----
                                                                          $ 106                 64
                                                                           ====              =====
</TABLE>

     These amounts  receivable  from and payable to affiliates  were incurred in
     the ordinary course of business  between the Partnership and its affiliates
     and represent timing differences in the accrual and payment of expenses and
     fees  described  above  or in the  accrual  and  remittance  of net  rental
     revenues from TEM.

     It is the policy of the  Partnership  and the  General  Partners  to charge
     interest on  intercompany  balances which are outstanding for more than one
     month, to the extent such balances relate to loans for Equipment purchases.
     Interest is charged at a rate not greater  than the  General  Partners'  or
     affiliates'  own  cost  of  funds.   There  was  no  interest   charged  on
     intercompany  balances for the  three-month  period ended March 31, 1997 or
     1996.

Note 6.  Rentals Under Operating Leases

     The following is a schedule by year of minimum future rentals receivable on
     noncancelable operating leases as of March 31, 1997:

         Year ending March 31:

         1998.............................................        $ 389
         1999.............................................           17
         2000.............................................            1
                                                                    ---
         Total minimum future rentals receivable..........        $ 407
                                                                    ===

Note 7.  Direct Financing Leases

     The components of the net investment in direct financing leases as of March
     31, 1997 and December 31, 1996 are as follows:
<TABLE>
<CAPTION>

                                                                            1997              1996
                                                                            ----              ----
<S>                                                                        <C>                <C>
                  Future minimum lease payments receivable..........       $ 828               967
                  Residual value ...................................           3                 4
                  Less: unearned income ............................        (237)             (276)
                                                                            ----              ----

                  Net investment in direct financing leases ........       $ 594               695
                                                                            ====              ====
</TABLE>

     The  following is a schedule by year of minimum lease  payments  receivable
     under the eight direct financing leases as of March 31, 1997:
<TABLE>
<CAPTION>

<S>                      <C>                                                               <C>    
                         1998.................................................             $   285
                         1999.................................................                 234
                         2000.................................................                 220
                         2001.................................................                  89
                                                                                               ---

                         Total minimum lease payments receivable..............             $   828
                                                                                               ===
</TABLE>

     Rental  income  for  the three-month  periods ended March 31, 1997 and 1996
     includes $64 and $67, respectively, of income from direct financing leases.

Note 8.  Redemptions

     The following  redemption  offerings were  consummated  by the  Partnership
     during the three-month period ended March 31, 1997:
<TABLE>
<CAPTION>

                                                      Units                Average
                                                     Redeemed          Redemption Price             Amount Paid
                                                     --------          ----------------             -----------
<S>                                                 <C>                  <C>                       <C>   
             Balance at December 31, 1997..........    22,897               $11.56                     $ 265

             Quarter ended:
                March 31, 1997.....................       126               $ 8.71                         1
                                                       ------                                           ----

             Partnership to date...................    23,023               $11.55                     $ 266
                                                       ======                                           ====
</TABLE>
                                                                     

     The redemption price is fixed by formula and varies depending on the length
     of time the units are outstanding.

Note 9.  Commitments

     At March 31,  1997,  the  Partnership  has  committed  to purchase  380 new
     containers at an approximate  total purchase price of $1,178 which includes
     acquisition  fees of $56. These  commitments were made to TAS which, as the
     contracting  party,  has in turn  committed to purchase  this  Equipment on
     behalf of the Partnership.




<PAGE>
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

            (Dollar amounts in thousands except for per unit amounts)

The Financial Statements contain information which will assist in evaluating the
financial  condition of the Partnership for the three-month  periods ended March
31, 1997 and 1996. Please refer to the Financial Statements and Notes thereto in
connection with the following discussion.

Liquidity and Capital Resources

From November 8, 1989 until January 15, 1991,  the  Partnership  was involved in
the offering of limited partnership interests to the public. On January 15, 1991
the Partnership received its maximum subscription amount of $75,000.

The Partnership  has set up a program whereby limited  partners may redeem units
for a specified  redemption  value.  The redemption  price is set by formula and
varies  depending  on length  of time  units  are  outstanding.  Up to 2% of the
Partnership's outstanding units may be redeemed each year, although the 2% limit
may be exceeded at the Managing General  Partner's  discretion.  All redemptions
are subject to the Managing  General  Partner's  good faith  determination  that
payment for the redeemed units will not (i) cause the Partnership to be taxed as
a  corporation,  (ii) impair the capital or  operations of the  Partnership,  or
(iii) impair the ability of the Partnership to pay  distributions  in accordance
with its  distribution  policy.  During the quarter  ended March 31,  1997,  the
Partnership redeemed 126 units for a total of $1.

The Partnership  invests working capital and cash flow from operations  prior to
its distribution or reinvestment in additional  Equipment in short-term,  highly
liquid  investments.  It is the policy of the  Partnership to maintain a minimum
working  capital  reserve in an amount  which is the lesser of (i) 1% of capital
contributions or (ii) $100. At March 31, 1997, the Partnership's  cash of $1,578
was primarily invested in a market-rate account.

During  the  quarter  ended  March  31,  1997,  the  Partnership  declared  cash
distributions  to limited  partners  pertaining to the period from December 1996
through February 1997, in the amount of $1,491. These distributions represent 8%
of original  capital  (measured on an  annualized  basis) on each unit. Of these
distributions, on a GAAP basis, $799 was a return of capital and the balance was
from net  earnings.  On a cash  basis,  all of  these  distributions  were  from
operations.

At March 31, 1997, the  Partnership had committed to purchase 380 new containers
at an approximate  total purchase  price of $1,178,  which includes  acquisition
fees of $56. At March 31, 1997, the  Partnership  had sufficient cash on hand to
meet these commitments. In the event the Partnership decides not to purchase the
Equipment,  one of the General  Partners or an affiliate of the General Partners
will retain the Equipment for its own account.

For the quarters  ended March 31, 1997 and 1996,  the  Partnership  had net cash
provided  by  operating  activities  of $3,079  and  $2,991,  respectively.  The
increase over the prior period was primarily  attributable  to a decrease in due
from  affiliates,  net,  offset  by  decreases  in  net  earnings  and  accounts
receivable from operations.  The decrease in due from affiliates, net was due to
timing  differences  in the accrual  and payment of expenses  and fees or in the
accrual and remittance of net rental  revenues.  The decrease in net earnings of
50% in the first  quarter  of 1997  compared  to the first  quarter  of 1996 was
primarily  due to a 19%  decrease  in rental  revenues.  The  decrease in rental
revenues  between periods was due to a decline in utilization,  rental rates and
fleet size.  These  decreases are discussed  more fully below under  "Results of
Operations".  Accounts receivable from operations decreased primarily due to the
decrease  in  rental  income.   Notwithstanding  this  reduction,   the  average
collection period of accounts receivable from operations increased from 116 days
to 139  days  for the  three-month  periods  ended  March  31,  1996  and  1997,
respectively.

As explained below under "Results of Operations",  demand for leased  containers
has  declined,  and  this  decline  has  affected  the  Partnership's  financial
condition.

Net  cash  used in  investing  activities  (the  purchase  and  sale  of  rental
equipment) for the quarter ended March 31, 1997 was $1,642  compared to $565 for
the same period in 1996.  This  difference  reflects that, on a cash basis,  the
Partnership  purchased  more  Equipment in the first quarter of 1997 than in the
same period in 1996. The General Partners believe that these differences reflect
normal fluctuations in equipment sales and purchases.  Moreover, the Partnership
has  used  Equipment  in its  portfolio  and  expects  to  sell  this  Equipment
periodically when it reaches the end of its useful marine life.  Consistent with
its investment objectives and the General Partners' determination that Equipment
can be  profitably  sold or bought  at any  time,  the  Partnership  intends  to
reinvest all or a significant  amount of proceeds from future Equipment sales in
additional  Equipment.  Such additional  Equipment  purchases may not,  however,
equal the number of units sold.

Results of Operations

The  Partnership's  operations,   which  consist  of  rental  income,  container
depreciation,  direct container expenses,  management fees, and reimbursement of
administrative expenses were directly related to the size of the container fleet
(inventory)  during the  three-month  periods ended March 31, 1997 and 1996. The
following is a summary of the size of the container  fleet (in units)  available
for lease during those periods:

                                                         1997           1996
                                                         ----           ----

               Opening inventory...................     18,016         18,650
               Closing inventory...................     18,081         18,678
               Average.............................     18,049         18,664


The decline in the average  container  fleet of 3% from the  three-months  ended
March 31, 1996 to the equivalent period in 1997 was primarily due to the sale of
certain Equipment.  Although sales proceeds were used to purchase new Equipment,
fewer units were bought than sold,  resulting  in a net  decrease in the size of
the Equipment  fleet.  These factors  resulted in a slower rate of  reinvestment
than has been expected by the General  Partners and which is currently  expected
to continue.  Moreover,  the decline in the container  fleet  contributed  to an
overall  decline in rental  income from the three month  period  ended March 31,
1996 to the same  period  in 1997,  and  future  declines  in the  fleet  can be
expected to have a similar effect on rental income.

Rental  income  and  direct  container  expenses  are  also  affected  by  lease
utilization  percentages  for the  equipment  which  were 74% and 83% on average
during the quarters  ended March 31, 1997 and 1996,  respectively.  In addition,
rental income is affected by daily rental rates, which declined.

The  following is a comparative  analysis of the results of  operations  for the
quarters ended March 31, 1997 and 1996.

The  Partnership's  income from operations for the quarters ended March 31, 1997
and 1996 was $676 and $1,305, respectively, on total rental income of $2,524 and
$3,119,  respectively.  The largest  component of total rental  income is income
from  container  rentals,  which  decreased by $473,  or 18%, from 1996 to 1997.
Income from container rentals is largely  dependent on three factors:  equipment
available  for  lease  (average   inventory),   average  on-hire   (utilization)
percentage and average daily rental rates. Average on-hire utilization decreased
11%, average fleet size decreased 3% and average daily rental rates decreased by
3%.

Container  utilization  began to decline in late 1995 and that decline persisted
throughout 1996 and into 1997. The General  Partners  believe that this decrease
in demand for leased containers is the result of adverse changes in the business
of its shipping line  customers.  These changes  consist  principally  of: (i) a
general slowdown in the growth of world containerized cargo trade,  particularly
in the  Asia-North  America and  Asia-Europe  trade routes;  (ii)  over-capacity
resulting from the 1996 and 1997 additions of new,  larger ships to the existing
container  ship  fleet at a rate in excess of the growth  rate in  containerized
cargo  trade;   and  (iii)  shipping  line   alliances  and  other   operational
consolidations   that  have  allowed   shipping  lines  to  operate  with  fewer
containers,  thereby decreasing the demand for leased containers.  The container
ship  over-capacity  in particular  led to lower  shipping  rates,  resulting in
shipping  lines'  need to reduce  operating  costs.  The drive to reduce  costs,
coupled with the  availability  of  inexpensive  financing  and lower  container
prices,  encouraged  shipping  lines to purchase,  rather than lease,  a greater
number of new  containers in 1996 than in previous  years.  All of these factors
have led to downward pressure on container lease rates, a decline in utilization
of leased containers,  and an increase in leasing incentives and other discounts
being  granted  to  shipping  lines  by  container   lessors,   further  eroding
Partnership profitability.  The decline in demand for leased containers has been
accompanied  by a drop in the  purchase  price of new  containers.  For the near
term,  the  General  Partners  do not  foresee  any  changes in  current  market
conditions and caution that both  utilization  and lease rates could continue to
decline, adversely affecting the Partnership's operating results.

Substantially  all of the  Partnership's  rental income was  generated  from the
leasing of the Partnership's  equipment under short-term operating leases. There
were eight direct financing leases at March 31, 1997.

The balance of rental income consists of other  lease-related  items,  primarily
income  from  charges  to the  lessees  for  pick-up  of  containers  from prime
locations  less  credits  granted to lessees  for leasing  containers  from less
desirable locations (location income),  income from charges to the lessees under
a damage protection plan and income for handling and returning  containers.  For
the quarter ended March 31, 1997,  the total of these other revenue income items
decreased by $122 from the equivalent  period in 1996. The primary  component of
this net  decrease  in other  rental  income was due to a decrease  in  location
income of $118  which was  largely  due to lower  demand,  which  drove drop off
charges to lessees down and increased credits to lessees for picking up units at
less desirable locations.

Direct container expenses,  excluding bad debt benefit,  were $396 for the three
months ended March 31, 1997 as compared to $433 for the same period in 1996. The
decrease  was  primarily  due to a decrease in  maintenance  expense,  partially
offset by an increase in storage cost. Accrued  maintenance expense and expenses
accrued under the damage  protection  plan decreased by $82 primarily due to the
decrease in the average number of units requiring repairs from March 31, 1996 to
the same period in 1997,  coupled with a slight  decrease in the average  repair
costs per unit between the two periods.  The increase in storage cost of $97 was
due to the  decline in  utilization  for the three  months  ended March 31, 1997
compared to the same period in 1996.

Bad debt benefit  decreased from $146 in the first quarter of 1996 to $11 in the
same  period  of 1997.  The  benefit  recorded  in 1996 was  primarily  due to a
reduction in reserve requirements for a specific lessee as a result of a partial
resolution  of payment  problems  with that lessee  during the first  quarter of
1996.  The benefit  recorded  in the first  quarter of 1997 was mainly due to an
adjustment recorded to reduce an overaccrued reserve for one lessee.

Depreciation  expense  was $1,007 for the three  months  ended  March 31,  1997,
consistent  with  depreciation  expense of $1,002  for the same  period in 1996.
Depreciation expense remained consistent between periods,  despite a 3% decrease
in fleet size,  primarily due to there being fewer fully depreciated  containers
in the fleet in the first quarter of 1997 compared to the same period in 1996.

Management fees to affiliates  decreased $42 or 15%, from the three months ended
March 31, 1996 to the comparable period in 1997,  primarily due to a decrease in
equipment  management fees. Equipment management fees, which are based primarily
on gross revenues decreased $42 due to the decrease in rental income and were 7%
of gross revenue for both periods. Incentive management fees, which are based on
the  Partnership's  limited and general  partner  distribution  percentages  and
partners' capital, were $63 for both periods.

General and administrative  costs to affiliates decreased by 11%, or $21, in the
quarter ended March 31, 1997  compared to the same period in 1996.  The decrease
was primarily the result of a decline in overhead  costs  allocated from TEM and
TFS during these periods.

Other income  provided $31 of additional  income for the quarter ended March 31,
1997,  representing  an decrease of $82, or 73%, over the  equivalent  period in
1996.  The  decrease  was  attributable  to a $91  decrease  in  gain on sale of
Equipment offset by a $9 increase in interest income.

Net earnings per limited  partnership  unit decreased from $0.38 for the quarter
ended  March 31,  1996 to $0.19  for the same  period  in 1997,  reflecting  the
decrease in net earnings from $1,418 to $707 for the respective periods.

Although  substantially  all of the  Partnership's  income  from  operations  is
derived from assets employed in foreign operations, virtually all of this income
is  denominated  in United  States  dollars.  The  Partnership's  customers  are
international  shipping  lines  which  transport  goods on  international  trade
routes.  The  domicile  of the lessee is not  indicative  of where the lessee is
transporting  the  Equipment.  The  Partnership's  business  risk in its foreign
operations lies with the  creditworthiness of the lessees, and the Partnership's
ability to keep the Equipment under lease,  rather than the geographic  location
of the  Equipment  or the domicile of the  lessees.  The  Equipment is generally
operated on the international  high seas rather than on the domestic  waterways.
The  Equipment  is subject to the risk of war or other  political,  economic  or
social  occurrence  where the Equipment is used, which may result in the loss of
Equipment,  which,  in turn,  may have a  material  impact on the  Partnership's
results of operations  and  financial  condition.  The General  Partners are not
aware of any  conditions  as of March 31, 1997 which  would  result in such risk
materializing.

Other risks of the Partnership's  leasing  operations include  competition,  the
cost of  repositioning  Equipment  after  it  comes  off-lease,  the  risk of an
uninsured  loss,  increases in maintenance  expenses or other costs of operating
the  Equipment,  and the effect of world trade,  industry  trends and/or general
business and economic cycles on the Partnership's operations. See "Risk Factors"
in the Partnership's Prospectus, as supplemented,  for additional information on
risks of the Partnership's business.





<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.


                                     TEXTAINER EQUIPMENT INCOME FUND II, L.P.
                                     (A California limited partnership)

                                     By Textainer Financial Services Corporation
                                     The Managing General Partner


                                     By  ________________________________
                                         John R. Rhodes
                                         Executive Vice President



Date:   May 13, 1997

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of Textainer  Financial
Services  Corporation,  the Managing  General Partner of the Registrant,  in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>

<S>                                     <C>                                        <C>
Signature                                Title                                      Date



                                         Executive Vice President                   May 13, 1997
-------------------------------          (Principal Financial and
John R. Rhodes                           Accounting Officer) and
                                         Secretary                                         


                                         President (Principal Executive             May 13, 1997
-------------------------------          Officer) and Director
James E. Hoelter                         


</TABLE>
<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.


                                     TEXTAINER EQUIPMENT INCOME FUND II, L.P.
                                     (A California limited partnership)

                                     By Textainer Financial Services Corporation
                                     The Managing General Partner


                                     By    /s/ John R. Rhodes
                                        -------------------------------
                                        John R. Rhodes
                                        Executive Vice President



Date:    May 13, 1997

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of Textainer  Financial
Services  Corporation,  the Managing  General Partner of the Registrant,  in the
capacities and on the dates indicated:

<TABLE>
<CAPTION>
<S>                                     <C>                                          <C>
Signature                                Title                                        Date



/s/ John R. Rhodes                       Executive Vice President                     May 13, 1997
-------------------------------          (Principal Financial and
John R. Rhodes                           Accounting Officer) and
                                         Secretary
                                         

/s/ James E. Hoelter                     President (Principal Executive               May 13, 1997
-------------------------------          Officer) and Director
James E. Hoelter                         

</TABLE>