SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-K/A

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

                  For the fiscal year ended December 31, 1996

                                       OR

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

                  For the transition period from ____________ to ____________

                         Commission file number 33-76930

                         TELEBANC FINANCIAL CORPORATION
             -------------------------------------------------------
             (Exact name of registrant as specified in its charter)

                       Delaware                                13-3759196
   --------------------------------------------        -------------------------
            (State or other jurisdiction of                 (I.R.S. Employer
            incorporation or organization)                  Identification No.)

        1111 NORTH HIGHLAND STREET, ARLINGTON, VIRGINIA          22201
        -----------------------------------------------     -----------------
           (Address of principal executive offices)            (Zip Code)

       Registrant's telephone number, including area code: (703) 247-3700.

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

                                (Not applicable)

           Securities registered pursuant to Section 12(g) of the Act:

                                (Not applicable)

         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
                                             --   ---

         Indicate by check mark if disclosure of delinquent  filers  pursuant to
Item 405 of  Regulation  S-K (ss.  229.405  of this  chapter)  is not  contained
herein,  and will not be contained,  to the best of registrant's  knowledge,  in
definitive proxy or information statements incorporated by reference in Part III
of this Form 10-K or any amendment to this Form 10-K. [ X ]

         Based upon the closing  price of the  registrant's  common  stock as of
March  20,  1997,  the  aggregate  market  value  of the  voting  stock  held by
non-affiliates of the registrant is $10.4 million.*

         The number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date is:

                 Class: Common Stock, par value $.01 per share.
                Outstanding at March 20, 1997: 2,211,961 shares.

                      DOCUMENTS INCORPORATED BY REFERENCE:
         Portions of the definitive  proxy statement for the 1997 Annual Meeting
of Stockholders are incorporated by reference into Part III, Items 10 - 13.

----------
*    Solely  for  purposes  of this  calculation,  all  executive  officers  and
     directors  of  the  registrant,  Employee  Stock  Ownership  Plan  and  all
     shareholders  reporting  beneficial  ownership  of  more  than  5%  of  the
     registrant's  common stock are considered to be affiliates.  This reference
     to affiliate status is not necessarily a conclusive determination for other
     purposes.



<PAGE>

                                EXPLANATORY NOTE

         This Form 10-K/A is being filed to provide the information  required in
Part III of Form 10-K and to file Exhibit 99.1.


                                    PART III

ITEM 10.      DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

         Reference  is made to the  information  set  forth  under  the  caption
"Election of Directors" in the  definitive  proxy  statement for the 1997 Annual
Meeting  of  Stockholders,  and  such  information  is  incorporated  herein  by
reference.

ITEM 11.      EXECUTIVE COMPENSATION

         Reference  is made to the  information  set forth  under  the  captions
"Executive  Compensation  and Other  Information"  and "Election of Directors --
Compensation of Directors" in the definitive proxy statement for the 1997 Annual
Meeting  of  Stockholders,  and  such  information  is  incorporated  herein  by
reference.

ITEM 12.      SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         Reference  is made to the  information  set forth  under  the  captions
"Stock  Owned by  Management  and  Certain  Beneficial  Owners"  and  "Executive
Compensation and Other Information -- Security Ownership of the Company's Parent
by Management" in the definitive  proxy statement for the 1997 Annual Meeting of
Stockholders, and such information is incorporated herein by reference.

ITEM 13.      CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         Reference  is made to the  information  set forth  under  the  captions
"Election of Directors" and "Executive  Compensation  and Other  Information" in
the definitive proxy statement for the 1997 Annual Meeting of Stockholders,  and
such information is incorporated herein by reference.


                                     PART IV

ITEM 14.      EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

         The following exhibit is filed with this report:


       99.1       Definitive  proxy  statement  for the 1997  Annual  Meeting of
                  Stockholders.





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<PAGE>

                                   SIGNATURES

         Pursuant to the  requirements  of Section 13 or 15(d) 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 as of the 23rd day of
April, 1997.

                                                TELEBANC FINANCIAL CORPORATION
                                                -------------------------------
                                                           Registrant


                                                By:   /s/ Mitchell H. Caplan
                                                      --------------------------
                                                      Mitchell H. Caplan
                                                      Vice Chairman of the Board
                                                         and President


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<PAGE>



                                  EXHIBIT INDEX
                                                                    Sequentially
                                                                      Numbered
  Exhibit No.                         Exhibit                           Page
  -----------                         -------                           ----

     99.1        Definitive proxy statement for the 1997 Annual Meeting of    
                 Stockholders.





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