U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

                 [X] Quarterly Report Under Section 13 or 15(d)
                     of the Securities Exchange Act of 1934

                For the quarterly period ended September 30, 1998

                 [ ] Transition Report under Section 13 or 15(d)
                     of the Securities Exchange Act of 1934

          For the transition period from ____________ to _____________

                         Commission file number: 0-24557

                         CARDINAL FINANCIAL CORPORATION
        (Exact Name of Small Business Issuer as Specified in its Charter)


           Virginia                                               54-1874630
(State or Other Jurisdiction of                                (I.R.S. Employer
Incorporation or Organization)                               Identification No.)

                                10641 Lee Highway
                             Fairfax, Virginia 22030
                    (Address of Principle Executive Offices)

                                 (703) 246-7343
                (Issuer's Telephone Number, Including Area Code)


         Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 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 _____

         State the number of shares  outstanding of each of the issuer's classes
of common equity, as of the latest practicable date:

          4,239,509 shares of common stock, par value $1.00 per share,
                      outstanding as of September 30, 1998



<PAGE>

                         CARDINAL FINANCIAL CORPORATION

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>

                                                                                                          Page No.

Part I.       Financial Information
<S>                                                                                                         <C>
         Item 1.  Financial Statements

                  Condensed Consolidated Statements of Condition
                           September 30, 1998 and December 31, 1997..........................................3

                  Condensed Consolidated Statements of Income
                           Three Months and Nine Months Ended September 30, 1998.............................4

                  Condensed Consolidated Statement of Comprehensive Income
                           Three Months and Nine Months Ended September 30, 1998.............................5

                  Condensed Consolidated Statement of Changes in Shareholders' Equity
                           Nine Months Ended September 30, 1998..............................................6

                  Condensed Consolidated Statements of Cash Flows
                           Three Months and Nine Months Ended September 30, 1998.............................7

                  Notes to Condensed Consolidated Financial Statements.......................................8

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


Part II.      Other Information

         Item 1.  Legal Proceedings.........................................................................20

         Item 2.  Changes in Securities and Use of Proceeds.................................................20

         Item 3.  Defaults Upon Senior Securities...........................................................20

         Item 4.  Submission of Matters to a Vote of Security Holders.......................................20

         Item 5.  Other Information.........................................................................20

         Item 6.  Exhibits and Reports on Form 8-K..........................................................20
</TABLE>



                                       -2-
<PAGE>

                         PART I -- FINANCIAL INFORMATION

Item 1.      Financial Statements

                  CARDINAL FINANCIAL CORPORATION AND SUBSIDIARY
                 CONDENSED CONSOLIDATED STATEMENTS OF CONDITION
                        (In thousands, except share data)

<TABLE>
<CAPTION>
                                                                            September 30,             December 31,
                                                                                 1998                     1997
                                                                          ------------------        -----------------
ASSETS                                                                       (unaudited)
<S>                                                                            <C>                      <C>     
Cash and cash equivalents                                                      $ 34,004                 $  4,283

Securities available for sale                                                    15,577                        -

Loans, net of unearned discount and deferred loan fees                            3,148                        -
Less: Allowance for loan losses                                                      41                        -
                                                                          ------------------        -----------------
                                                                                  3,107                    4,283

Subscriptions receivable                                                              -                    4,510
Premises and equipment, net                                                       1,327                        -
Accrued interest receivable and other assets                                        168                        3
                                                                          ------------------        -----------------

    Total Assets                                                               $ 54,183                 $  8,796
                                                                          ==================        =================


LIABILITIES AND SHAREHOLDERS' EQUITY

Deposits                                                                       $ 18,335                 $      -
Accrued interest payable and other liabilities                                      345                      245
                                                                          ------------------        -----------------

   Total Liabilities                                                             18,680                      245


Common stock, $1 par value, 50,000,000 shares 
   authorized, 4,239,509 outstanding in 1998 and
   1,174,988 outstanding in 1997                                                  4,240                    1,175
Uncollected subscriptions receivable                                                  -                    (100)
Additional paid in capital                                                       32,327                    7,621
Accumulated deficit                                                             (1,085)                    (145)
Accumulated other comprehensive income                                               21                        -
                                                                          ------------------        -----------------

   Total Shareholders' Equity                                                    35,503                    8,551
                                                                          ------------------        -----------------

   Total Liabilities and Shareholders' Equity                                  $ 54,183                 $  8,796
                                                                          ==================        =================
</TABLE>

See accompanying notes to interim financial statements.



                                      -3-
<PAGE>

                  CARDINAL FINANCIAL CORPORATION AND SUBSIDIARY
                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                           Three Months               Nine Months
                                                                              Ended                      Ended
                                                                           September 30,              September 30,
                                                                               1998                       1998
                                                                         -----------------          -----------------
<S>                                                                      <C>                        <C>         
INTEREST AND DIVIDEND INCOME
Loans                                                                    $     30,918               $     34,662
Investment securities                                                          74,547                     75,467
Interest bearing deposits                                                     484,196                    713,230
                                                                         -----------------          -----------------

     Total Interest and Dividend Income                                       589,661                    823,359


INTEREST EXPENSE
Deposits                                                                      144,877                    151,525
Borrowings                                                                          -                      1,616
                                                                         -----------------          -----------------

     Total Interest Expense                                                   144,877                    153,141
                                                                         -----------------          -----------------

     NET INTEREST INCOME                                                      444,784                    670,218

Provision for loan losses                                                      37,960                     40,970
                                                                         -----------------          -----------------

     Net interest income after provision for loan losses                      406,824                    629,248


NON-INTEREST INCOME
Service fees                                                                    1,156                      1,172
Other income                                                                    8,816                      9,502
                                                                         -----------------          -----------------

     Total Non-Interest Income                                                  9,972                     10,674


NON-INTEREST EXPENSE
Salary and benefits                                                           399,549                    777,572
Occupancy                                                                      57,278                    127,112
Professional fees                                                              97,189                    226,724
Other operating expenses                                                      297,017                    448,471
                                                                         -----------------          -----------------

     Total Non-Interest Expense                                               851,033                  1,579,879

     Net loss before income taxes                                           (434,237)                  (939,957)

Provision for income taxes                                                          -                          -

     NET LOSS                                                            $  (434,237)               $  (939,957)
                                                                         =================          =================

     Basic and diluted loss per share                                    $     (0.12)               $     (0.45)
                                                                               
     Weighted-average shares outstanding                                    3,523,531                  2,109,041
</TABLE>

See accompanying notes to interim financial statements.



                                      -4-
<PAGE>

                  CARDINAL FINANCIAL CORPORATION AND SUBSIDIARY
            CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                             Three Months           Nine Months 
                                                                                 Ended                 Ended
                                                                             September 30,          September 30, 
                                                                                 1998                   1998
                                                                           ------------------    ------------------
<S>                                                                          <C>                   <C>        
Net loss                                                                     $ (434,237)           $ (939,957)
Other comprehensive income:
  Unrealized gain on securities available for sale                                20,831                20,831
                                                                           ------------------    ------------------
                                                                           
Comprehensive income                                                         $ (413,406)           $ (919,126)
                                                                           ==================    ==================
</TABLE>


See accompanying notes to interim financial statements.




                                      -5-
<PAGE>

                  CARDINAL FINANCIAL CORPORATION AND SUBSIDIARY
                       CONDENSED CONSOLIDATED STATEMENT OF
                         CHANGES IN SHAREHOLDERS' EQUITY
                                 (In thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                                                       Accumulated
                                                        Additional                        Other         Uncollected
                                            Common        Paid-in     Accumulated     Comprehensive     Subscription
                                             Stock        Capital       Deficit          Income          Receivable      Total
                                         -------------- ------------ --------------- ----------------  --------------- -----------

<S>                                    <C>                 <C>            <C>                               <C>          <C>  
BALANCE, DECEMBER 31, 1997             $     1,175         7,621          (145)                -            (100)         8,551

Issuance of 234,521 shares of common
   stock par value $1, at $7.50 per
   share, net of costs                         235         1,525              -                -                -         1,760

Issuance of 2,830,000 shares of                                                       
   common stock par value $1, at
   $10.00 per share, net of costs            2,830        23,181              -                -                -        26,011

Payment of subscription receivable               -             -              -                -              100           100

Change in unrealized gain on
   securities available for sale                 -             -              -               21                -            21

Net loss                                         -             -          (940)                -                -         (940)
                                         -------------- ------------ --------------- ----------------  --------------- -----------

BALANCE, SEPTEMBER 30, 1998            $     4,240        32,327        (1,085)               21                -        35,503
                                         ============== ============ =============== ================  =============== ===========

</TABLE>



See accompanying notes to interim financial statements.



                                      -6-
<PAGE>

                  CARDINAL FINANCIAL CORPORATION AND SUBSIDIARY
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                             Three Months           Nine Months 
                                                                                 Ended                 Ended
                                                                             September 30,         September 30,
                                                                                 1998                  1998
                                                                           ------------------    ------------------
<S>                                                                            <C>                   <C> 
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net loss                                                                    $  (434)              $  (940)
   Adjustments to reconcile net loss to net cash used in operating
     activities:
      Depreciation                                                                   72                    98
      Provision for loan losses                                                      38                    41
      Increase in accrued interest receivable and other assets                     (18)                 (165)
      Increase (decrease) in accrued interest payable and other
       liabilities                                                                 (11)                   100
                                                                           ------------------    ------------------
      NET CASH USED IN OPERATING ACTIVITIES                                       (354)                 (866)
                                                                           ------------------    ------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
   Purchase of premises and equipment                                             (222)               (1,425)
   Purchase of securities available for sale                                   (15,316)              (15,556)
   Net increase in loan portfolio                                               (2,811)               (3,148)
                                                                           ------------------    ------------------
      NET CASH USED IN INVESTING ACTIVITIES                                    (18,349)              (20,129)
                                                                           ------------------    ------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Net increase in deposits                                                      13,534                18,335
   Proceeds from stock issuance, net                                             26,010                27,771
   Decrease in subscription receivables                                               -                 4,610
                                                                           ------------------    ------------------
      NET CASH PROVIDED BY FINANCING ACTIVITIES                                  39,544                50,716
                                                                           ------------------    ------------------

NET INCREASE IN CASH AND CASH EQUIVALENTS                                        20,841                29,271
CASH AND CASH EQUIVALENTS AT BEGINNING OF 
  PERIOD                                                                         13,162                 4,283
                                                                           ------------------    ------------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD                                     $ 34,003              $ 34,004
                                                                           ==================    ==================


Supplemental disclosure of cash flow information
   Cash paid during period for interest:                                       $    149              $    158
</TABLE>

See accompanying notes to interim financial statements.



                                      -7-
<PAGE>

                  CARDINAL FINANCIAL CORPORATION AND SUBSIDIARY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               September 30, 1998
                                   (Unaudited)

Note 1

Organization

Cardinal  Financial  Corporation (the "Company") was  incorporated  November 24,
1997 under the laws of the  Commonwealth  of Virginia as a holding company whose
activities consist of investment in its wholly owned subsidiary,  Cardinal Bank,
N.A.

Basis of Presentation

In the opinion of management,  the accompanying condensed consolidated financial
statements have been prepared in accordance with generally  accepted  accounting
principles for interim financial information.  Accordingly,  they do not include
all of the information and footnotes required by generally  accepted  accounting
principles for complete financial statements. However, all adjustments that are,
in the  opinion  of  management,  necessary  for a fair  presentation  have been
included. The results of operations for the nine months ended September 30, 1998
are not  necessarily  indicative of the results to be expected for the full year
ending December 31, 1998. The unaudited interim  financial  statements should be
read in conjunction with the audited financial statements and notes to financial
statements that are presented in the Prospectus dated July 17, 1998 that is part
of  the  Company's   Registration  Statement  on  Form  SB-2  (Registration  No.
333-52279)  and that was filed with the  Securities  and Exchange  Commission on
July 20, 1998  pursuant  to Rule 424(b)  under the  Securities  Act of 1933,  as
amended.

Note 2

Income Recognition on Loans

Interest  on loans is  credited  to income as  earned  on the  principal  amount
outstanding.   When,  in  management's  judgment,  the  full  collectibility  of
principal  or  interest  on a loan  becomes  uncertain,  that  loan is placed on
nonaccrual.  Any accrued but uncollected interest on nonaccrual loans is charged
against current income. Interest income is then recognized as cash is received.

Interest  accruals  are resumed on such loans only when they are  brought  fully
current  with respect to  principal  and  interest and when,  in the judgment of
management,  the loans have  demonstrated  a new period of  performance  and are
estimated to be fully collectible as to both principal and interest.



                                      -8-
<PAGE>

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (continued)

Allowance for Loan Losses

The  allowance  for loan losses is a valuation  allowance  available  for losses
incurred on loans. It is established  through charges to earnings in the form of
provisions  for loan losses.  Loan losses are charged to the  allowance for loan
losses  when a  determination  is made that  collection  is  unlikely  to occur.
Recoveries are credited to the allowance at the time that cash is received.

Prior to the beginning of each year, and quarterly  during the year,  management
estimates  whether the  allowance  for loan losses is adequate to absorb  losses
that can be anticipated in the existing portfolio.  Based on these estimates, an
amount is charged to the  provision for loan losses to adjust the allowance to a
level determined to be adequate to absorb currently anticipated losses.

Management's  judgment  as to the level of future  losses on  existing  loans is
based on  management's  internal  review  of the loan  portfolio,  including  an
analysis of the borrowers'  current  financial  position,  the  consideration of
current and  anticipated  economic  conditions  and their  potential  effects on
specific  borrowers,  an evaluation of the existing  relationships  among loans,
potential  loan losses,  and the present  level of the loan loss  allowance  and
results  of  examinations  by  independent   consultants.   In  determining  the
collectibility of certain loans, management also considers the fair value of any
underlying  collateral.  In addition,  various regulatory agencies, as a part of
their  examination  process,  periodically  review the Bank's allowance for loan
losses.  Such  agencies  may  require  the Bank to  recognize  additions  to the
allowance based on their judgments  about  information  available to them at the
time of their examination.



                                      -9-
<PAGE>


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


         Cardinal  Financial  Corporation  (the  "Company")  is the bank holding
company for Cardinal Bank, N.A. in Fairfax,  Virginia (the "Bank").  The Company
was in a development stage until the Bank commenced operations on June 8, 1998.

         The Company  funded its start-up  and  organizational  costs  through a
private  offering  (the "Private  Offering")  of 1,409,509  shares of its common
stock, par value $1.00 per share (the "Common Stock"),  in the fourth quarter of
1997 and the first  quarter of 1998.  The total  proceeds  to the Company in the
Private  Offering  were  $10.6  million,  of  which  $8.0  million  was  used to
capitalize  the Bank. In addition,  the Company  raised  additional  capital for
general  corporate  purposes  and to support  the growth of assets and  deposits
through a public offering (the "Public  Offering") of 2,830,000 shares of Common
Stock in the third  quarter of 1998.  The total  proceeds  to the Company in the
Public Offering were $26.1 million,  after deducting  underwriting discounts and
expenses.

         The following discussion presents management's  discussion and analysis
of the consolidated financial condition and results of operations of the Company
as of September 30, 1998 and December 31, 1997 and for the three and nine months
ended September 30, 1998. This discussion should be read in conjunction with the
Company's Unaudited Condensed  Consolidated  Financial  Statements and the notes
thereto appearing  elsewhere in this report.  Since principal banking operations
commenced on June 8, 1998, a comparison  of the September 30, 1998 results (when
banking  operations  were in progress) to those of September  30, 1997 (prior to
the Company's formation) is not meaningful.

Results of Operations

         Total assets of the Company increased to $54.2 million at September 30,
1998, compared to $8.8 million at December 31, 1997, representing an increase of
$45.4  million.  The increase is primarily  attributable  to the receipt of $1.5
million in proceeds  from the Private  Offering,  the $26.1  million in proceeds
from the Public Offering and deposits of $18.3 million. Total loans at September
30, 1998 were $3.1  million  (see Table I for loan  portfolio  detail),  and the
investment  portfolio at September 30, 1998 was $15.6 million.  Included in cash
and cash equivalents are $32.5 million of Fed Funds Sold.

         Net loss for the three months and the nine months ended  September  30,
1998 was $434.2  thousand  or $0.12 per share and $940.0  thousand  or $0.45 per
share,  respectively.  While implementing its growth strategy,  the Company does
not anticipate  profitable  operations on a consolidated  basis through at least
December 31, 1999.

         Net interest  income is the  Company's  primary  source of earnings and
represents the difference  between  interest and fees earned on interest bearing
assets and the interest paid on deposits and other interest bearing liabilities.
Net interest income for the three months and the



                                      -10-
<PAGE>

nine  months  ended  September  30,  1998  totaled  $444.8  thousand  and $670.2
thousand, respectively.

         The  Company's  net  interest  margin for the three months and the nine
months  ended  September  30,  1998 was 4.33% and 4.66%,  respectively.  Average
earning assets for the three and nine months ended September 30, 1998 were $43.1
million and $22.8  million,  respectively.  The growth in earning  assets can be
attributed  to  the  investment  of the  proceeds  of the  Public  Offering  and
deposits.  Table II presents an analysis  of average  earning  assets,  interest
bearing  liabilities and demand deposits with the related components of interest
income and interest expense.

         The  provision for loan losses for the three months and the nine months
ended September 30, 1998 was $38.0 thousand and $41.0 thousand,  respectively. A
provision for loan losses was recorded  even though the Company's  short history
reflects no loan  losses or any  material  trends in past due loans.  Due to the
Company's  short  history,  management  is  currently  maintaining  a loan  loss
allowance  comparable  to its peers.  The allowance for loan losses at September
30, 1998 was $41.0 thousand.  The current ratio of the allowance for loan losses
to loans is 1.30%.  The  amounts  of loan loss  provision  is  determined  by an
evaluation of the level of loans outstanding, the level of non-performing loans,
historical loan loss experience, delinquency trends, the amount of actual losses
charged  to the  reserve  in a given  period,  and  assessment  of  present  and
anticipated economic conditions.

         The Company  recorded limited  non-interest  income due to the start-up
nature of its  business.  Non-interest  income for the three months and the nine
months  ended  September  30,  1998  was  $10.0  thousand  and  $10.7  thousand,
respectively.  These amounts reflect the service charges on deposit accounts and
fees on miscellaneous bank services.

         Non-interest  expense for the three  months and the nine  months  ended
September  30, 1998 totaled  $851.0  thousand and $1.58  million,  respectively.
These expenses are being incurred in support of the Company's growth and consist
of salaries  and  benefits,  occupancy,  professional  fees and other  operating
expenses.

Capital Resources

         Shareholders'  equity at September 30, 1998 was $35.5 million  compared
to $8.6  million at December  31, 1997.  The growth in  shareholders'  equity is
attributable  to the receipt of proceeds from the Private  Offering and proceeds
from the Public Offering, reduced by accumulated losses.

         At  September  30,  1998,  the  Company's  tier 1 and total  risk-based
capital  ratios were 254.1% and 254.4%,  respectively.  The  Company's  leverage
ratio was 82.3% at September 30, 1998.  Comparative  ratios at December 31, 1997
are not  meaningful  since the Bank did not  commence  operations  until June 8,
1998.  Table III reflects the  components of regulatory  capital.  The Company's
capital  structure  places it well above minimum  regulatory  requirements.  The
Company  maintains  a  strong  capital  base in order to  implement  its  growth
strategy,  which



                                      -11-
<PAGE>

includes the funding of three  additional  bank  subsidiaries  and an investment
securities  subsidiary  as well as ensuring that it has the resources to protect
against the risks inherent in its business.

Liquidity

         Liquidity  provides the Company with the ability to meet normal deposit
withdrawals,  while  also  providing  for the  credit  needs  of  customers.  At
September 30, 1998,  cash, cash  equivalents  and securities  available for sale
totaled $49.6 million, representing 91.5% of total assets. Table IV reflects the
details  of  the  available-for-sale  portfolio.   Management  is  committed  to
maintaining  liquidity at a level sufficient to protect depositors,  provide for
reasonable growth, and fully comply with all regulatory requirements.

Interest Rate Sensitivity

         An important element of asset/liability management is the monitoring of
the Company's  sensitivity to interest rate  movements.  In order to measure the
effect of interest rates on the Company's net interest income,  management takes
into  consideration  the  expected  cash  flows  from  the  securities  and loan
portfolios  and the expected  magnitude of the  repricing of specific  asset and
liability  categories.  Management  evaluates interest sensitivity risk and then
formulates  guidelines to manage this risk based upon its outlook  regarding the
economy,   forecasted  interest  rate  movements  and  other  business  factors.
Management's  goal is to  maximize  and  stabilize  the net  interest  margin by
limiting exposure to interest rate changes.

         The data in Table V  reflects  re-pricing  or  expected  maturities  of
various assets and  liabilities  at September 30, 1998.  This gap represents the
difference  between interest sensitive assets and liabilities in a specific time
interval.  Interest sensitivity gap analysis presents a position that existed at
one  particular  point in time,  and assumes  that assets and  liabilities  with
similar  re-pricing  characteristics  will  re-price at the same time and to the
same  degree.   Given  the  Company's  short  history  and  anticipated  growth,
management has maintained a high positive short-term gap.

Year 2000 Compliance

         As the year 2000  approaches,  an important  business issue has emerged
regarding how existing  software  programs and operating systems can accommodate
this date value.  Many existing  application  software products were designed to
accommodate  a two-digit  year.  For example,  "98" is stored on the systems and
represents 1998 and "00" represents 1900.

         The Company  utilizes a third-party  vendor for  processing its primary
banking  applications.   In  addition,  the  Company  also  uses  several  other
third-party vendors for ancillary computer applications. All third party vendors
for the Company's banking applications either are already Year 2000 ready or are
in the process of modifying,  upgrading or replacing their computer applications
to ensure Year 2000 compliance.  Because the Company was recently formed, all of
its data  processing  equipment is new and is Year 2000 ready.  The Company does
not expect to incur any material expense to replace data processing equipment.



                                      -12-
<PAGE>

         The Company  has a Year 2000  compliance  program  where it reviews the
Year  2000  issues  that may be faced by its  third-party  vendors.  Under  such
program,  the Company is examining the need for  modifications or replacement of
all  non-Year  2000 ready  software.  Because the Company is new, it has had the
opportunity to screen its third-party vendors and those it has chosen either are
Year 2000 ready or are in the process of becoming  Year 2000  compliant.  All of
the Company's data  processing  vendor  contracts have Year 2000 clauses,  which
allow the  Company to test for  compliance  and to cancel  without  penalty if a
vendor does not meet its Year 2000  compliance  plan.  The  Company's  Year 2000
compliance program provides that all critical data processing  applications will
be tested  beginning in November 1998 and that  testing  will be completed on or
before March 31, 1999. If any software is not Year 2000 ready at March 31, 1999,
the vendor contract can be terminated and an alternative vendor can be selected.
The Company has identified  alternative vendors,  should they be necessary.  The
Company's loan policy includes Year 2000 risk management parameters,  and it has
no Year 2000 credit risk at this time.

         The Company  does not  currently  expect that the cost of its Year 2000
compliance  program,  including possible  remediation costs, will be material to
its financial condition and expects that it will satisfy such compliance program
without  material  disruption  of its  operations.  The costs  that the  Company
anticipates  incurring will be for testing of vendor Year 2000  compliance.  The
Company will utilize  internal staff for this purpose,  as well as a third-party
vendor as necessary.  The Company does not  separately  track the internal costs
incurred for its Year 2000  compliance  program,  and such costs are principally
the related  payroll  costs for its test team.  In the event that the  Company's
significant  vendors,  including its correspondent,  the Federal Reserve Bank of
Richmond, do not successfully and timely achieve Year 2000 compliance,  however,
the Company's  business,  results of operations or financial  condition would be
adversely affected.

         The Company's  contingency plan will be based on the ability to replace
mission  critical  vendors that do not achieve Year 2000  compliance.  Alternate
vendors have been identified and, should any of the Company's  existing  vendors
not certify Year 2000  compliance  by March 31,  1999,  the Company will proceed
with plans to move to alternate  vendors and to establish a contingency plan for
handling the Company's Year 2000 exposure.

         The Company is subject to periodic review by its primary regulator, the
Office of the Comptroller of the Currency,  for the purpose of determining  that
the Company does have a Year 2000 plan and that it is in fact adhering to it.

Forward Looking Statements

         This report contains certain forward-looking  statements,  which can be
identified by the use of  forward-looking  terminology  such as "may, " "will, "
"expect, " "anticipate,  " "estimate,  " or "continue, " or the negative thereof
or other  comparable  terminology.  The Company  cautions  readers  that certain
important factors, including, among others, problems with technology utilized by
the Company as described  above, in some cases have affected,  and in the future
could affect,  



                                      -13-
<PAGE>

the Company's  actual  results and could cause the Company's  actual  results in
1998 and beyond to differ materially from those expressed in any forward-looking
statements in this report.  Reference is made to the "Risk  Factors"  section of
the  Prospectus  dated July 17, 1998 that is part of the Company's  Registration
Statement on Form SB-2  (Registration No. 333-52279) and that was filed with the
Securities  and  Exchange  Commission  on July 20, 1998  pursuant to Rule 424(b)
under the  Securities  Act of 1933, as amended,  for a description of certain of
these important factors.





                                      -14-
<PAGE>

                                     TABLE I


                  CARDINAL FINANCIAL CORPORATION AND SUBSIDIARY
                                    Net Loans
                                 (In thousands)


                                                   September 30,
                                                        1998
                                                   -------------
                                                    (Unaudited)

Commercial                                               $621
Real estate - commercial                                  369
Real estate - mortgage                                  1,235
Home equity lines                                         475
Consumer                                                  451
                                                       ------

Gross loans                                            $3,151

Less: unearned income, net                                (3)
Less: allowance for loan loss                            (41)
                                                       ------

Total net loans                                        $3,107
                                                       ======



                                      -15-
<PAGE>

                                    TABLE II


                  CARDINAL FINANCIAL CORPORATION AND SUBSIDIARY
           CONDENSED CONSOLIDATED AVERAGE BALANCES AND INTEREST RATES
                                 (In thousands)
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                   Three Months Ended                       Nine Months Ended
                                                                   September 30, 1998                       September 30, 1998

                                                               Average               Average          Average                Average
                                                               Balance   Interest     Rate            Balance    Interest     Rate
                                                             -------------------------------        --------------------------------
<S>                                                          <C>           <C>       <C>              <C>           <C>       <C>
ASSETS

INTEREST EARNINGS ASSETS:
Investment securities available for sale                      $4,977       $75        5.86%            $1,697       $75        5.86%

Loans:
          Commercial                                             597        13        8.75%               235        17        9.51%
          Real Estate                                            422        10        9.23%               142        10        9.23%
          Consumer                                               230         8       12.95%                79         8       12.93%
                                                             -----------------------------------------------------------------------
                    Total Loans                                1,249        31        9.69%               456        35       10.02%

Federal funds sold                                            34,557       484        5.48%            17,422       713        5.40%

                                                             -----------------------------------------------------------------------
Total Interest Earning Assets                                 40,783       590        5.66%            19,575       823        5.55%

NON-INTEREST EARNINGS ASSETS:
Cash and due from banks                                        1,044                                      407
Premises and equipment, net                                    1,202                                      630
Allowance for Loan Losses                                       (10)                                       (3)
Accrued interest receivable and other assets                      97                                    2,197

                                                            ------------------------------------------------------------------------
Total Non-Interest Earning Assets                              2,333                                    3,231

TOTAL ASSETS                                                 $43,116                                  $22,806
                                                            ========================================================================

LIABILITIES AND SHAREHOLDERS' EQUITY

INTEREST-BEARING LIABILITIES
Interest Bearing Deposits:
          Interest checking                                     $662        $4        2.09%              $244        $4        2.10%
          Money markets                                        4,639        45        3.78%             1,613        46        3.78%
          Statement savings                                      130         1        2.93%                44         1        2.93%
          Certificates of deposit                              6,629        96        5.64%             2,356       102        5.70%
                                                            ------------------------------------------------------------------------
                    Total Interest-Bearing Deposits           12,060       145        4.70%             4,257       153        4.74%

                                                            ------------------------------------------------------------------------
Total Interest Bearing Liabilities                            12,060       145        4.70%             4,257       153        4.74%

NON-INTEREST BEARING LIABILITIES
Demand deposits                                                1,520                                      532
Accrued interest payable and other liabilities                   326                                      184

                                                            ------------------------------------------------------------------------
Total Non-Interest Bearing Liabilities                         1,846                                      716

                                                            ------------------------------------------------------------------------
Total Liabilities                                            $13,906                                   $4,973

                                                            ------------------------------------------------------------------------
Total Shareholders' Equity                                   $29,210                                  $17,833

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                   $43,116                                  $22,806
                                                            ------------------------------------------------------------------------

Interest Spread                                                                       0.96%                                    0.81%
                                                                          -----------------                        -----------------

Net Interest Margin                                                       $445        4.33%                        $670        4.66%
                                                                          =================                        =================

Cost to Fund Earning Assets                                                           1.32%                                    0.89%
                                                                                  ---------                                ---------
</TABLE>


                                      -16-
<PAGE>

                                   TABLE III

                  CARDINAL FINANCIAL CORPORATION AND SUBSIDIARY
                               Capital Components
                            As of September 30, 1998
                                 (In thousands)

<TABLE>
<CAPTION>

                                                                                                                    To Be Well
                                                                                                                Capitalized Under
                                                                                     For Capital                Prompt Corrective
                                                             Actual               Adequacy Purposes             Action Provisions
                                                       -------------------     ----------------------        -----------------------
                                                        Amount      Ratio        Amount        Ratio           Amount        Ratio
                                                        ------      -----        ------        -----           ------        -----
<S>                                                    <C>          <C>        <C>           <C>             <C>           <C>  
    Total capital to risk weighted assets              $35,522      254.4%     >= $1,117     >=  8.00%       >= $1,396     >=  10.0%
    Tier I capital to risk weighted assets              35,481      254.1%     >=    559     >=  4.00%       >=    838     >=   6.0%
    Leverage ratio tier I capital to quarterly
      average assets                                    35,481       82.3%     >=  1,724     >=  4.00%       >=  2,156     >=   5.0%

</TABLE>






                                      -17-

<PAGE>

                                    TABLE IV

                  CARDINAL FINANCIAL CORPORATION AND SUBSIDIARY
                         Securities - Available for Sale
                            As of September 30, 1998
                                 (In thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                                             Amortized       Market      Unrealized       Average
                                                              Par Value         Cost         Value       Gain/(Loss)       Yield
                                                              -------------------------------------------------------------------
<S>                                                            <C>            <C>           <C>               <C>          <C> 
U.S. Government Agencies
     Within one year                                              $300           297           297             -           5.34%
     One to five years                                          14,000        14,005        14,022            17           5.63%
     Five to ten years                                             500           502           506             4           5.81%
     After ten years                                                 -             -             -             -              -
---------------------------------------------------------------------------------------------------------------------------------
                Total U.S Government Agencies                  $14,800        14,804        14,825            21           5.59%
---------------------------------------------------------------------------------------------------------------------------------
                                                                                                                        
Mortgage-Backed Obligations                                                                                             
     Within one year                                                 -             -             -             -              -
     One to five years                                             496           512           512             -           6.79%
     Five to ten years                                               -             -             -             -              -
     After ten years                                                 -             -             -             -              -
---------------------------------------------------------------------------------------------------------------------------------
                Total Mortgage-Backed Obligations                 $496           512           512             -           6.79%
---------------------------------------------------------------------------------------------------------------------------------
                                                                                                                        
Other Securities                                                                                                        
     Within one year                                                 -             -             -             -              -
     One to five years                                               -             -             -             -              -
     Five to ten years                                               -             -             -             -              -
     After ten years                                               240           240           240             -           6.00%
---------------------------------------------------------------------------------------------------------------------------------
               Total Other Securities                             $240           240           240             -           6.00%
---------------------------------------------------------------------------------------------------------------------------------
               Total Securities Available for Sale             $15,536        15,556        15,577            21           6.13%
                                                                                                                         
</TABLE>





                                      -18-
<PAGE>

                                    TABLE V

                  CARDINAL FINANCIAL CORPORATION AND SUBSIDIARY
                     Interest Rate Sensitivity Gap Analysis
                            As of September 30, 1998
                                 (In thousands)
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                              1-90       91-180       181-365        1-5        Over 5
                                                              Days        Days         Days         Years        Years        TOTAL
<S>                                                          <C>         <C>          <C>          <C>         <C>          <C>    
ASSETS
Investment Securities
U.S. Government agency securities                                 -      13,311        1,008          506           -       $14,825
Mortgage-backed securities                                        -           -            -          512           -           512
Other securities                                                  -           -            -            -         240           240
Total Investment Securities                                       -      13,311        1,008        1,018         240        15,577
Federal Funds Sold                                           32,546                                                          32,546
Loans
Variable rate loans                                           1,088           -        1,174          551           -         2,813
Fixed rate loans                                                125           -           22          119          73           339
Total Gross Loans                                             1,213           -        1,196          670          73         3,152
Total Earning Assets                                         33,759      13,311        2,204        1,688         313       $51,275
Cumulative Rate Sensitive Assets                             33,759      47,070       49,274       50,962      51,275

Liabilities and Shareholders' Equity
Deposits
Demand deposits                                               3,742           -            -            -           -        $3,742
Interest checking                                               782           -            -            -           -           782
Statement savings                                               177           -            -            -           -           177
Money market accounts                                         4,227           -            -            -           -         4,227
Certificates of deposit                                          84       1,056        8,025          241           -         9,406
Total Deposits                                                9,012       1,056        8,025          241           -        18,334
Other liabilities                                                 -           -            -            -           -             -
Total Interest Bearing Liabilities                            9,012       1,056        8,025          241           -       $18,334
Cumulative Rate Sensitive Liabilities                         9,012      10,068       18,093       18,334      18,334

Gap                                                          24,747      12,255      (5,821)        1,446         313
Cumulative Gap                                               24,747      37,002       31,181       32,628      32,941
Gap/ Total Assets                                            45.67%      22.62%      -10.74%        2.67%       0.58%
Cumulative Gap/ Total Assets                                 45.67%      68.29%       57.55%       60.22%      60.80%

</TABLE>



                                      -19-
<PAGE>

                          PART II -- OTHER INFORMATION

Item 1.      Legal Proceedings

             Not applicable.

Item 2.      Changes in Securities and Use of Proceeds

             Not applicable.

Item 3.      Defaults Upon Senior Securities

             Not applicable.

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

             No matters were submitted to a vote of security  holders during the
             quarter ended September 30, 1998.

Item 5.      Other Information

             Not applicable.

Item 6.      Exhibits and Reports on Form 8-K

             (a)     Exhibits

                     27     Financial Data Schedule (filed electronically only).

             (b)     Reports on Form 8-K - none.




                                      -20-
<PAGE>

                                   SIGNATURES

         In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                           CARDINAL FINANCIAL CORPORATION       



Date:  November 16, 1998                    /s/ L. Burwell Gunn, Jr.            
                                           -------------------------------------
                                           L. Burwell Gunn, Jr.
                                           President and Chief Executive Officer



Date:  November 16, 1998                    /s/ Joseph L. Borrelli              
                                           -------------------------------------
                                           Joseph L. Borrelli
                                           Chief Financial Officer