UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                   
   
                           AMENDMENT #1 TO FORM 10-Q
    
(Mark One)
[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
       SECURITIES EXCHANGE ACT OF 1934

       For the quarterly period ended December 31, 1995

                                        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 1-8952

                          INTERSTATE/JOHNSON LANE, INC.
             (Exact name of Registrant as specified in its charter)

                                    Delaware
         (State or other jurisdiction of incorporation or organization)

                                   56-1470946
                      (I.R.S. Employer Identification No.)

      Interstate Tower, P.O. Box 1012, Charlotte, North Carolina 28201-1012
               (Address of principal executive offices, zip code)

                                 (704) 379-9000
              (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 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 the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.

              Class                         Outstanding at January 31, 1996
              -----                        --------------------------------
(Common stock, $.20 par value)                         6,146,052


                                  PAGE 1 OF 14
<PAGE>


                 INTERSTATE/JOHNSON LANE, INC. AND SUBSIDIARIES


                                      Index

<TABLE>
<CAPTION>



                                                                                Page Number
<S>                                                                            <C>  

Part I.  Financial Information

         Item 1.  Financial Statements

                  Condensed Consolidated Statements of
                  Financial Condition--December 31, 1995 and
                  September 30, 1995                                                  3

                  Condensed Consolidated Statements of
                  Operations--Three Months Ended
                  December, 1995 and 1994                                             4

                  Condensed Consolidated Statements of
                  Cash Flows--Three Months Ended
                  December 31, 1995 and 1994                                         5

                  Notes to Condensed Consolidated Financial
                  Statements                                                         6

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


Part II. Other Information

         Item 1.  Legal Proceedings                                                 12

         Item 6.  Exhibits and Reports on Form 8-K                                  12



</TABLE>

                                     Page 2








<PAGE>


                 INTERSTATE/JOHNSON LANE, INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                                   (Unaudited)

<TABLE>
<CAPTION>


                                                                      (All dollars in thousands)
                                                                  December 31,            September 30,
                                                                     1995                    1995
                                                                  ------------            ------------
<S>                                                             <C>                       <C>   

Assets
Cash and cash equivalents                                       $      19,543           $      26,537
Cash and securities segregated for
   regulatory purposes                                                124,029                 117,616
Loans under matched securities resale agreements                      202,420                 129,623
Receivables:
  Financing resale agreements                                           9,624                  23,848
  Customers                                                           195,372                 175,328
  Brokers, dealers and clearing agencies                               15,488                  18,048
  Other                                                                 6,514                   4,722
Trading securities owned                                               68,363                  75,749
Land, buildings, and improvements, net                                  6,286                   7,285
Office facilities and equipment, net                                    8,844                   8,865
Goodwill and intangible assets                                         13,528                  13,678
Other assets                                                           17,523                  15,213
                                                                  ------------            ------------
                                                                $     687,534           $     616,512
                                                                  ============            ============

Liabilities and Shareholders' Equity
Short-term borrowings:
  Checks payable                                                $      20,190           $      11,872
  Bank loans                                                            3,000                        -
  Financing repurchase agreements                                      16,123                  38,561
Borrowings under matched securities repurchase agreements             203,960                 130,453
Payables:
  Customers                                                           280,942                 267,714
  Brokers and dealers                                                  15,416                   6,619
   
  Other                                                                 8,265                   7,322
Accrued compensation and benefits                                      12,055                  14,460
    
Securities sold but not yet purchased                                  12,896                  25,305
Notes payable                                                           6,910                   7,772
Other liabilities and accrued expenses                                 14,198                  15,864
                                                                  ------------            ------------
                                                                      593,955                 525,942
                                                                  ------------            ------------
Minority interests                                                        200                     200
                                                                  ------------            ------------
Long-term subordinated debt                                            20,999                  20,999
                                                                  ------------            ------------
Shareholders' equity:
      Common stock                                                      1,377                   1,377
      Additional paid-in-capital                                       31,278                  31,510
   
      Retained earnings                                                46,929                  45,043
    
                                                                  ------------            ------------
                                                                       79,584                  77,930
      Less:  treasury stock, at cost                                   (7,204)                 (8,559)
                                                                  ------------            ------------
            Total shareholders' equity                                 72,380                  69,371
                                                                  ------------            ------------
                                                                $     687,534           $     616,512
                                                                  ============            ============

</TABLE>

    The accompanying notes are an integral part of the condensed consolidated
                             financial statements.

                                     Page 3
<PAGE>


                 INTERSTATE/JOHNSON LANE, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)
<TABLE>
<CAPTION>


                                                                                              For the Three Months
                                                                                               Ended December 31,
                                                                                           (All dollars in thousands)
                                                                                             1995              1994
                                                                                         -------------     -------------

           <S>                                                                       <C>                 <C>

             Revenues:
                  Commissions and sales credits                                        $       34,317    $       24,247
                  Trading gains, net                                                            2,039             1,111
                  Investment banking and underwriting                                           1,739               955
                  Asset management and advisory                                                 2,144             1,722
                  Interest                                                                      8,462            10,208
                  Other                                                                         1,833             1,424
                                                                                         -------------     -------------
             Total revenues                                                                    50,534            39,667
                  Interest expense                                                              5,558             7,775
                                                                                         -------------     -------------
             Net revenues                                                                      44,976            31,892
                                                                                         -------------     -------------
             Expenses:
   
                  Compensation and benefits                                                    28,533            20,328
    
                  Technology and telephone                                                      4,149             3,345
                  Occupancy                                                                     2,092             2,092
                  Execution, clearance and depository                                           1,080               875
                  Promotion and development                                                     1,489             1,199
                  Professional services                                                           795               810
                  Printing, postage and supplies                                                  856               712
                  Other operating expenses                                                      2,474               978
                                                                                         -------------     -------------
   
             Total expenses                                                                    41,468            30,339
                                                                                         -------------     -------------

             Income before income taxes                                                         3,508             1,553

             Income tax expense                                                                 1,438               621
                                                                                         -------------     -------------

             Net Income                                                                $        2,070    $          932
                                                                                         =============     =============

             Earnings per share:
                  Primary                                                              $         0.34 $            0.15
                                                                                         =============     =============

                  Fully diluted                                                        $         0.31 $            0.15
                                                                                         =============     =============
             Weighted average shares:
                  Primary                                                                   6,110,606         6,389,920
                                                                                         =============     =============

                  Fully diluted                                                             7,562,021         7,657,172
                                                                                         =============     =============
    

</TABLE>

          The accompanying notes are an integral part of the condensed
                       consolidated financial statements.


                                     Page 4
<PAGE>


                 INTERSTATE/JOHNSON LANE, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS 
                     For the three months ended December 31,
                                  (Unaudited)

<TABLE>
<CAPTION>

                                                                           (All dollars in thousands)
                                                                             1995             1994
                                                                          ------------     ------------
<S>                                                                       <C>            <C>  

Cash flows from operating activities:
-----------------------------------------
   
Net income                                                              $       2,070    $         932
    
                                                                          ------------     ------------
Adjustments  to  reconcile  net  income to cash  provided  (used)  by  operating
  activities:
Depreciation and amortization                                                   1,111              794
Deferred income taxes                                                            (950)               -
Provision for real estate charges                                                 850              250
Other non-cash items                                                              657             (108)
                                                                          ------------     ------------
                                                                                1,668              936
                                                                          ------------     ------------
Changes in operating assets and liabilities:
Cash and  securities segregated for
    regulatory purposes                                                        (6,413)          (2,945)
Loans under matched securities resale and repurchase agreements, net              710            1,749
Net payables to customers                                                      (6,816)           4,935
Net receivables from brokers, dealers and clearing agencies                    11,357           (4,218)
Other receivables                                                              (1,792)           1,742
Trading securities owned, net                                                  (5,023)         (28,840)
Other assets                                                                   (1,371)            (117)
   
Accrued compensation and benefits                                              (2,405)          (5,778)
Other liabilities and accrued expenses                                            357             (105)
                                                                          ------------     ------------
                                                                              (11,396)         (33,577)
                                                                          ------------     ------------
             Cash used by operating activities                                 (7,658)         (31,709)
    
                                                                          ------------     ------------

Cash flows from financing activities:
-----------------------------------------
Proceeds from (repayment of ):
   Short-term bank borrowings                                                  11,318           (2,246)
   Borrowings under financing repurchase and resale agreements, net            (8,214)          18,136
   Notes payable                                                                 (862)             (45)
Purchase of stock for treasury                                                   (692)            (840)
Dividends paid                                                                   (185)            (192)
                                                                          ------------     ------------

             Cash provided by financing activities                              1,365           14,813
                                                                          ------------     ------------

Cash flows from investing activities:
-----------------------------------------
Capital expenditures                                                             (701)            (678)
                                                                          ------------     ------------
             Cash used by investing activities                                   (701)            (678)
                                                                          ------------     ------------

Net decrease (increase) in cash and cash equivalents                           (6,994)         (17,574)
Cash and cash equivalents at beginning of period                               26,537           30,193
                                                                          ------------     ------------
Cash and cash equivalents at end of period                              $      19,543    $      12,619
                                                                          ============     ============
Cash paid during the quarter for:
   Interest                                                             $       5,835    $       7,736
   Income taxes                                                         $       1,336    $         151


</TABLE>

    The accompanying notes are an integral part of the condensed consolidated
                             financial statements.

                                     Page 5

<PAGE>





                 INTERSTATE/JOHNSON LANE, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


1.   BASIS OF PRESENTATION:

     The interim financial statements are unaudited; however, such information
     reflects all normal recurring adjustments which, in the opinion of
     management, are necessary for a fair presentation of the results for the
     period. The nature of the Company's business is such that the results of
     any interim period are not necessarily indicative of results for a full
     fiscal year.


2.   NET CAPITAL REQUIREMENTS:

     As a registered broker-dealer and member of the New York Stock Exchange,
     Interstate/Johnson Lane Corporation ("IJL"), the principal operating
     subsidiary of the Company, is subject to the Securities and Exchange
     Commission's uniform net capital rule. IJL has elected to operate under the
     alternative method of the rule, which prohibits a broker-dealer from
     engaging in any transactions when its "net capital" is less than 2% of its
     "aggregate debit balances" arising from customer transactions, as these
     terms are defined in the rule. The Exchange may also impose business
     restrictions on a member firm if its net capital falls below 5% of its
     aggregate debit balances. IJL is also subject to the Commodity Futures
     Trading Commission minimum net capital requirement.

   
     At December 31, 1995, IJL's net capital was 20% of its aggregate debit
     balances and approximately $36.4 million in excess of its minimum
     regulatory requirements.
    


3.   COMMITMENTS AND CONTINGENCIES:

     Leases for office space and equipment are accounted for as operating
     leases. Approximate minimum rental commitments under noncancelable leases,
     some of which contain escalation clauses and renewal options, are as
     follows:

                                                                Millions

                  For the nine months ended September 30, 1996      $7.9

                  For the fiscal year ended September 30,
                                    1997                             7.2
                                    1998                             5.0
                                    1999                             3.2
                                    2000                             1.3
                                    Thereafter                       4.9
                                                                --------
                                                                  $ 29.5


                                     Page 6
<PAGE>




                 INTERSTATE/JOHNSON LANE, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


3.   COMMITMENTS AND CONTINGENCIES, CONTINUED:

     In connection with its involvement as a general partner and/or placement
     agent of various real estate limited partnerships, the Company has
     guaranteed certain obligations of limited partners and, with others, has
     jointly or severally guaranteed mortgage loan obligations of some of the
     partnerships. At December 31, 1995, contingent liabilities under these
     obligations amounted to approximately $2.1 million in the aggregate.

     Of a $20 million irrevocable letter of credit available, the amount
     outstanding at December 31, 1995 under this facility was $2.5 million.


4.   LEGAL PROCEEDINGS:

     The Company is involved in certain litigation arising in the ordinary
     course of business. Management believes, based upon discussion with
     counsel, that the outcome of this litigation will not have a material
     effect in the Company's financial position. The materiality of legal
     matters on the Company's future operating results depends on the level of
     future results of operations as well as the timing and ultimate outcome of
     such legal matters.


5.   FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK:

     IJL's business activities involve the execution, settlement and financing
     of securities transactions generating accounts receivable, and thus may
     expose IJL to financial risk in the event a customer or other counterparty
     is unable to fulfill its contractual obligations. IJL controls the risk
     associated with collateralized loans by revaluing collateral at current
     prices, monitoring compliance with applicable credit limits and industry
     regulations, and requiring the posting of additional collateral when
     appropriate.

     Obligations arising from financial instruments sold short in connection
     with its normal trading activities expose IJL to risk in the event market
     prices increase, since it may be obligated to repurchase those positions at
     a greater price. IJL's short selling primarily involves debt securities,
     which are typically less volatile than equities or options.

                                     Page 7

<PAGE>





                 INTERSTATE/JOHNSON LANE, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


5.   FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK, CONTINUED:


     Forward and futures contracts provide for the seller agreeing to make
     delivery of securities or other instruments at a specified future date and
     price. Risk arises from the potential inability of counterparties to honor
     contract terms, and from changes in values of the underlying instruments.
     At December 31, 1995, IJL's commitments included forward purchase and sale
     contracts involving mortgage-backed securities with long market values of
     approximately $27.9 million and short market values of approximately $23.9
     million and futures purchase and sale contracts with long market values of
     $600,000 and short market values of $11.1 million.

     IJL enters into resale agreements, whereby it lends money by purchasing
     U.S. government/agency or mortgage-backed securities from customers or
     dealers with an agreement to resell them to the same customers or dealers
     at a later date. Such loans are collateralized by the underlying
     securities, which are held in custody by IJL and may be converted into cash
     at IJL's option. In addition, IJL monitors the market value of the
     collateral, and issues margin calls as necessary according to the
     creditworthiness of the borrower. Approximately 98% of all loans under
     securities resale agreements at December 31, 1995 were made to two
     counterparties.

     IJL incurs risk in underwriting public securities offerings to the extent
     that prospective buyers fail to purchase the securities. The Company
     attempts to mitigate this risk through due diligence carried out prior to
     undertaking the contractual obligation.


   
6.   LONG-TERM INCENTIVE COMPENSATION PLAN:


     The Company's Board of Directors approved a three-year incentive
     compensation plan ("the Plan") for selected executive officers at its July
     1996 meeting. The Plan was approved retroactively to the beginning of the
     Company's 1996 fiscal year; accordingly, quarterly financial information
     has been restated to reflect adoption of the Plan. Compensation 
     expense recognized under the Plan for the quarter ended December 
     31, 1995 totaled $177,000 and is reflected in the accompanying restated 
     financial statements. Maximum imputed shares issuable under the Plan as 
     of December 31, 1995 totaled 200,000, and are included as common stock 
     equivalents in the computation of fully diluted earnings per share.
    

                                     Page 8

<PAGE>





                 INTERSTATE/JOHNSON LANE, INC. AND SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


General Business Environment

The Company's principal activities -- securities brokerage for individual
(retail) and institutional investors, market-making in equity and fixed-income
securities, investment banking and underwriting, and investment management and
advisory services -- are highly competitive. Strategic alliances between
investment firms and commercial banks, insurance companies, and other financial
services entities have intensified this competition. Many of the Company's
revenue sources are sensitive to marketplace trading volumes and to interest
rate conditions which can be volatile. As a result, revenues and earnings may
vary significantly from quarter to quarter.


In recent years, the Company's retail sales force has grown in large part due to
the recruitment and training of individuals without securities industry
experience. At December 31, 1995, approximately 22% of the Company's retail
financial consultants had fewer than three years' industry experience. While
this strategy may be rewarding in the future, near-term slowdowns in individual
investor activity could negatively impact the revenue production of a less
seasoned sales force. Implementation of prospective Securities and Exchange
Commission disclosure requirements for broker-dealers regarding payment for
order flow, and for money managers regarding "soft dollar" arrangements with
broker-dealers, could also indirectly stifle certain revenue streams in the
future.


Liquidity and Capital Resources

   
The Company's net cash position decreased $7.0 million for the three months
ended December 31, 1995. Operating activities consumed $11.4 million of cash,
offset by $3.7 million of net income adjusted for depreciation and other
non-cash charges. Financing activities provided $1.4 million of cash while
capital expenditures totaled $700,000.
    

The Company's asset base consists primarily of cash, cash equivalents, and other
assets which can be converted to cash within one year; at December 31, 1995,
these assets comprised approximately 93% of the balance sheet. Day-to-day
financing requirements generally are influenced by the level of securities
inventories, net receivables from customers and broker-dealers, and net
receivables under resale agreements. Significant incremental cash requirements
also may occur from time to time in connection with payments under deferred
compensation plans, repurchase of the Company's common stock and/or convertible
debentures, payment of dividends, and litigation settlements arising from normal
business operations. In addition, the Company anticipates capital spending of up
to $8 million over the next several years in conjunction with a planned program
of technology improvements.

                                     Page 9

<PAGE>





                 INTERSTATE/JOHNSON LANE, INC. AND SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONTINUED


Liquidity and Capital Resources, continued

At December 31, 1995, the Company had $152 million of unused call loan financing
available. In addition, the Company maintains credit lines of several hundred
million dollars for collateralizing repurchase agreements with other financial
institutions, and has financed its customer receivables with customer payables
for many years. Management believes that these resources, funds provided by
operations, and permanent capital of shareholders' equity and long-term
subordinated debt, will satisfy normal financing needs for the foreseeable
future.

   
The Company's broker-dealer subsidiary, Interstate/Johnson Lane Corporation
("IJL"), is subject to liquidity and capital requirements of the Securities and
Exchange Commission, Commodity Futures Trading Commission, and The New York
Stock Exchange, and consistently has operated well in excess of the minimum
requirements. At December 31, 1995, IJL had net capital of $40.5 million,
"excess net capital" of approximately $36.4 million, and a net capital ratio of
20%.
    


Results of Operations

   
For the three months ended December 31, 1995, net revenues increased $13.1
million, or 41%, from the previous year, while expenses, other than interest,
increased $11.1 million, or 37%. Net income of $2.1 million was up $1.1 million
from the results of the period of a year ago.
    

Overall, commissions and sales credits increased by about $10.1 million, or 42%
from the same three-month period of a year ago, representing gains of 37% in the
retail sector and 50% in the institutional sector. Increases in secondary market
transactions in both exchange listed and OTC equities contributed to the
majority of the increase in both the retail and institutional sectors. Increased
sales of mutual fund shares and annuity products also contributed to the
increase in the retail sector, while improving new issues markets and increased
sale of mortgage-backed securities had a positive impact on the institutional
sector.

Increased profits of $500,000 in most areas of fixed-income trading were
augmented by a $400,000 improvement in OTC trading results to produce an overall
increase in trading gains of $900,000, or 84%.

Investment banking fees and underwriting profits increased $800,000, or 82%, for
the same three month period due to an improved capital-raising market, coupled
with an increased level of managed underwritings in the quarter. Asset
management and advisory fees were up $400,000 for the three month period due to
the continued growth of asset-based fees charged retail clients in lieu of
transaction-based commissions.


                                    Page 10

<PAGE>





                 INTERSTATE/JOHNSON LANE, INC. AND SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONTINUED


Results of Operations, continued

Interest revenues were down about $1.7 million for the three months ended
December 31, 1995, while expenses decreased $2.2 million for the corresponding
period. The resultant increase of $500,000 in net interest income is due
primarily to higher rates earned on increased segregated customer funds, and to
increased inventories of mortgage-backed securities. The majority of the
decrease in both revenues and expenses is attributable to significantly lower
levels of matched resale and repurchase agreements.

   
Compensation and benefits costs increased $8.2 million, or 40% for the three
month period ended December 31, 1995 due primarily to an increase in
transaction-based commissions and other profit-driven incentives including the
new management LTIP described in Note 6 to the Condensed Consolidated Financial
Statements. Technology and telephone expense increased $800,000, or 24%, for the
quarter primarily due to expenses related to the Company's ongoing program of
technology improvements. Execution, clearance and depository costs increased
$200,000, or 23%, primarily from increased transaction volume. Promotion and
development costs increased $300,000, or 24%, due to the Company's continuing
effort to build revenue. Other operating expenses increased $1.5 million, or
153%, for the quarter largely as a result of increased provisions for legal and
related matters, and of adjustments to the carrying value of certain assets.
    

                                    Page 11

<PAGE>





                           PART II. OTHER INFORMATION



Item 1. Legal Proceedings

     The Company is involved in certain litigation arising in the ordinary
     course of business. Management believes, based upon discussion with
     counsel, that the outcome of this litigation will not have a material
     effect in the Company's financial position. The materiality of legal
     matters on the Company's future operating results depends on the level of
     future results of operations as well as the timing and ultimate outcome of
     such legal matters.


Item 6. Exhibits and Reports on Form 8-K

         (a)      Exhibits

                  Designation of Exhibit                          Sequential
                       in this Report        Description          Page Number
                            11            Statement Regarding
                                          Computation of Per
                                          Share Earnings           14
                            27            Financial 
                                          Data
                                          Schedule                 15

         (b)      Reports on Form 8-K

                  There were no reports on Form 8-K filed for the three months
                  ended December 31, 1995.


                                    Page 12

<PAGE>




                          INTERSTATE/JOHNSON LANE, INC.
                          AND CONSOLIDATED SUBSIDIARIES


                                   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.



                                                INTERSTATE/JOHNSON LANE, INC.
                                                         Registrant


         Signature                        Title                        Date


   

_________________________           President and Chief
    James H. Morgan                 Executive Officer         October 21, 1996





_________________________           Vice President - Finance
    Edward C. Ruff                  and Treasurer (Principal
                                    Financial Officer)        October 21, 1996




_________________________           Assistant Vice President
  C. Fred Wagstaff, III             (Principal Accounting
                                    Officer)                  October 21, 1996
    

                                    Page 13