<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                    FORM 10-Q


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


                         For Quarter Ended JUNE 30, 1998

                         COMMISSION FILE NUMBER 33-46573
                                                --------


                             CAPITAL HOLDINGS, INC.
                             ----------------------
             (Exact name of registrant as specified in its Charter)



         OHIO                                           34-1588902
         ----                                           ----------
(State or other jurisdiction of            (I.R.S. Employer Identification No.)
incorporation or organization)



                     5520 MONROE STREET, SYLVANIA, OH 43560
                     --------------------------------------
              (Address of principal executive offices and zip code)


                                 (419) 885-7379
                                 --------------
              (Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
              (1) YES    X     (2) NO
                       -----          -----

As of June 30, 1998, there were 2,001,143 shares of common stock outstanding.


<PAGE>   2



                             CAPITAL HOLDINGS, INC.

                                      INDEX



<TABLE>
<CAPTION>
                                                                                      PAGE NUMBER
                                                                                      -----------
PART I.  FINANCIAL INFORMATION
------------------------------

<S>               <C>                                                                   <C>
Item 1.           Financial Statements (Unaudited):

                  Consolidated balance sheets
                           June 30, 1998 and December 31, 1997                          3

                  Consolidated statements of income
                           Three months ended June 30, 1998 and 1997                    4
                           Six months ended June 30, 1998 and 1997

                  Consolidated statements of shareholders' equity
                           Six months ended June 30, 1998 and 1997                      5

                  Consolidated statements of cash flows
                           Six months ended June 30, 1998 and 1997                      6

                  Notes to consolidated financial statements                            7


Item 2.           Management's Discussion and Analysis of Financial Condition
                  and Results of Operations                                             8 - 9




PART II.  OTHER INFORMATION                                                             10
---------------------------


SIGNATURES                                                                              11
----------
</TABLE>



                                                                               2


<PAGE>   3



                             CAPITAL HOLDINGS, INC.
                           CONSOLIDATED BALANCE SHEETS



<TABLE>
<CAPTION>
                                                                        (UNAUDITED)
                                                                        JUNE 30, 1998     DECEMBER 31, 1997
                                                                       ---------------    -----------------

<S>                                                                      <C>                 <C>         
ASSETS
    Cash and due from banks                                              $ 17,751,256        $ 15,291,951
    Federal Funds Sold                                                      9,000,000           8,000,000
                                                                         ------------        ------------
    Total Cash and Cash Equivalents                                        26,751,256          23,291,951

    Investment Securities Available for sale, at fair value               178,681,907         167,520,873

    Loans                                                                 521,494,027         469,036,091
         Less: Allowance for credit losses                                  7,422,578           6,947,377
                                                                         ------------        ------------
    Net loans                                                             514,071,449         462,088,714

    Bank premises and equipment                                             9,805,094           9,548,218
    Interest receivable and other assets                                    8,108,723           7,090,107
                                                                         ------------        ------------
Total Assets                                                             $737,418,429        $669,539,863
                                                                         ============        ============

LIABILITIES AND SHAREHOLDERS' EQUITY
    Deposits:
         Interest bearing                                                $584,614,444        $544,186,632
         Noninterest bearing                                               57,321,379          49,869,745
                                                                         ------------        ------------
    Total deposits                                                        641,935,823         594,056,377

    Short-term borrowings                                                  34,900,000          15,900,000
    Interest payable and other liabilities                                  6,792,612           9,036,804
                                                                         ------------        ------------
Total Liabilities                                                         683,628,435         618,993,181

SHAREHOLDERS' EQUITY
    Common stock, no par value, $.50 stated value;
         3,000,000 shares authorized and 2,001,143 shares
         issued and outstanding (1,991,922 at December 31, 1997)            1,000,571             995,961
    Capital in excess of stated value                                      33,479,892          33,179,413
    Retained earnings                                                      17,892,552          15,014,646
    Unrealized net holding gains on securities available for sale           1,416,979           1,356,662
                                                                         ------------        ------------
Total Shareholders' Equity                                                 53,789,994          50,546,682
                                                                         ------------        ------------
Total Liabilities and Shareholders' Equity                               $737,418,429        $669,539,863
                                                                         ============        ============
</TABLE>



See Accompanying Notes

                                                                               3



<PAGE>   4


                             CAPITAL HOLDINGS, INC.
                  CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

<TABLE>
<CAPTION>
                                                                   THREE MONTHS ENDED                    SIX MONTHS ENDED
                                                                        JUNE 30                               JUNE 30
                                                                1998                1997              1998               1997
                                                             -----------        -----------        -----------        -----------
<S>                                                          <C>                <C>                <C>                <C>        
Interest income:
       Loans, including fees                                 $10,866,041        $ 9,135,409        $21,070,443        $17,612,241
       Securities                                              2,749,164          2,591,282          5,447,198          5,177,292
       Federal funds sold                                         93,483            123,982            208,055            171,447
                                                             -----------        -----------        -----------        -----------
Total interest income                                         13,708,688         11,850,673         26,725,696         22,960,980

Interest expense:
       Deposits                                                7,150,435          6,508,100         14,112,511         12,417,906
       Short-term borrowings                                     662,362            246,341          1,142,419            609,055
                                                             -----------        -----------        -----------        -----------
Total interest expense                                         7,812,797          6,754,441         15,254,930         13,026,961

                                                             -----------        -----------        -----------        -----------
Net interest income                                            5,895,891          5,096,232         11,470,766          9,934,019

Provision for credit losses                                      280,000            240,000            510,000            480,000
                                                             -----------        -----------        -----------        -----------
Net interest income after provision for credit losses          5,615,891          4,856,232         10,960,766          9,454,019

Other income:
       Securities gains, net                                       7,917              4,056             21,127              7,806
       Other                                                     340,054            295,371            670,794            559,733
                                                             -----------        -----------        -----------        -----------
Total other income                                               347,971            299,427            691,921            567,539

Other expenses:
       Salaries and employee benefits                          1,626,867          1,424,006          3,231,290          2,758,581
       Equipment                                                 162,433            123,555            356,075            233,824
       Taxes other than income                                   118,175             97,591            238,650            203,764
       Courier services                                          152,183            130,697            295,436            257,983
       Net occupancy                                              73,108             73,157            144,377            147,885
       Other                                                     972,532            811,380          1,828,606          1,560,531
                                                             -----------        -----------        -----------        -----------
Total other expenses                                           3,105,298          2,660,386          6,094,434          5,162,568

                                                             -----------        -----------        -----------        -----------
Income before provision for federal income tax                 2,858,564          2,495,273          5,558,253          4,858,990

Provision for federal income tax                                 960,000            790,000          1,840,000          1,560,000
                                                             -----------        -----------        -----------        -----------

Net income                                                   $ 1,898,564        $ 1,705,273        $ 3,718,253        $ 3,298,990
                                                             ===========        ===========        ===========        ===========

Net income per share:
   Basic                                                     $      0.95        $      0.90        $      1.86        $      1.74
                                                             ===========        ===========        ===========        ===========
   Diluted                                                   $      0.93        $      0.86        $      1.83        $      1.67
                                                             ===========        ===========        ===========        ===========

Average shares outstanding:
   Basic                                                       2,000,858          1,898,843          1,999,658          1,898,483
                                                             ===========        ===========        ===========        ===========
   Diluted                                                     2,031,454          2,026,814          2,026,814          1,974,901
                                                             ===========        ===========        ===========        ===========
</TABLE>


See Accompanying Notes
                                                                               4


<PAGE>   5

                             CAPITAL HOLDINGS, INC.
          CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)
                     SIX MONTHS ENDED JUNE 30, 1998 AND 1997


<TABLE>
<CAPTION>
                                                                      COMMON STOCK          CAPITAL IN                 
                                                               --------------------------    EXCESS OF       RETAINED  
                                                                   SHARES       AMOUNT      STATED VALUE     EARNINGS  
                                                               -------------  -----------  ----------------------------

<S>                                                               <C>         <C>           <C>            <C>         
Balance at January 1, 1998                                        1,991,922     $995,961    $33,179,413    $15,014,646 

Net income                                                                                                   3,718,253 

Unrealized gains (losses) on securities, net of tax                                                                    

                                                                                                                       
Comprehensive Income                                                                                                   

Exercise of 4,250 common stock options at $16.44 per share            4,250        2,125         67,745                

Issuance of 4,338 shares of common stock at $47.00 per share          4,338        2,169        201,717                

Issuance of 633 shares of common stock at $49.50 per share              633          316         31,017                

Cash dividend declared, $.21 per share                                                                        (840,347)

                                                               --------------------------------------------------------
Balance at June 30, 1998                                          2,001,143   $1,000,571    $33,479,892    $17,892,552 
                                                               ========================================================






Balance at January 1, 1997                                        1,897,508     $948,754    $30,893,093     $9,217,448 

Net income                                                                                                   3,298,990 

Unrealized gains (losses) on securities, net of tax                                                                    

                                                                                                                       
Comprehensive Income                                                                                                   

Exercise of 1,022 common stock options at $10.78 per share            1,022          511         10,506                

Issuance of 340 shares of common stock at $37.50 per share              340          170         12,580                

Cash dividend declared, $.17 per share                                                                        (322,808)

                                                               --------------------------------------------------------
Balance at June 30, 1997                                          1,898,870     $949,435    $30,916,179    $12,193,630 
                                                               ========================================================

<CAPTION>                                                    
                                                                     OTHER          TOTAL       
                                                                 COMPREHENSIVE   SHAREHOLDERS'  
                                                                    INCOME          EQUITY      
                                                             --------------------------------   
                                                                                                
<S>                                                               <C>            <C>            
Balance at January 1, 1998                                        $1,356,662     $50,546,682    
                                                                                                
Net income                                                                         3,718,253    
                                                                                                
Unrealized gains (losses) on securities, net of tax                   60,317          60,317    
                                                                                                
                                                             --------------------------------   
Comprehensive Income                                                               3,778,570    
                                                                                                
Exercise of 4,250 common stock options at $16.44 per share                            69,870    
                                                                                                
Issuance of 4,338 shares of common stock at $47.00 per share                         203,886    
                                                                                                
Issuance of 633 shares of common stock at $49.50 per share                            31,333    
                                                                                                
Cash dividend declared, $.21 per share                                              (840,347)   
                                                                                                
                                                             --------------------------------   
Balance at June 30, 1998                                          $1,416,979     $53,789,994    
                                                             ================================   
                                                                                                
                                                                                                
                                                                                                
                                                                                                
                                                                                                
                                                                                                
Balance at January 1, 1997                                          $530,809     $41,590,104    
                                                                                                
Net income                                                                         3,298,990    
                                                                                                
Unrealized gains (losses) on securities, net of tax                 (333,123)       (333,123)   
                                                                                                
                                                             --------------------------------   
Comprehensive Income                                                               2,965,867    
                                                                                                
Exercise of 1,022 common stock options at $10.78 per share                            11,017    
                                                                                                
Issuance of 340 shares of common stock at $37.50 per share                            12,750    
                                                                                                
Cash dividend declared, $.17 per share                                              (322,808)   
                                                                                                
                                                             --------------------------------   
Balance at June 30, 1997                                            $197,686     $44,256,930    
                                                             ================================   
</TABLE>




See Accompanying Notes
                                                                               5



<PAGE>   6

                             CAPITAL HOLDINGS, INC.
                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                             SIX MONTHS ENDED
                                                                                                  JUNE 30
                                                                                         1998                  1997
                                                                                     -------------        -------------

<S>                                                                                  <C>                  <C>         
OPERATING ACTIVITIES:
    Net Income                                                                       $  3,718,253         $  3,298,990
    Adjustments to reconcile net income to net
       cash provided by operating activities:
            Provision for credit losses                                                   510,000              480,000
            Depreciation and amortization                                                 328,366              158,854
            Amortization and accretion of security premiums and discounts                 (22,939)             (54,413)
            Loss (gain) on sale of securities                                             (21,127)              (7,806)
            Deferred income taxes                                                        (173,400)            (163,200)
            Changes in assets and liabilities:
                Increase in interest receivable and other assets                         (878,585)            (817,949)
                (Decrease)/increase in interest payable and other liabilities          (2,326,000)           1,155,138
                                                                                     ------------         ------------
    Total adjustments                                                                  (2,583,685)             750,624
                                                                                     ------------         ------------
    Net cash provided by operating activities                                           1,134,568            4,049,614

INVESTING ACTIVITIES:
    Purchase of securities available for sale                                         (30,953,845)         (21,144,141)
    Net increase in loans                                                             (52,492,735)         (42,183,404)
    Purchase of bank premises and equipment                                              (585,242)          (3,082,481)
    Proceeds from maturities of securities available for sale                           2,407,683           10,531,764
    Proceeds from sales of securities available for sale                               17,522,880           10,006,047
                                                                                     ------------         ------------
    Net cash used in investing activities                                             (64,101,259)         (45,872,215)

FINANCING ACTIVITIES:
    Net increase in deposits                                                           47,879,446           63,523,858
    Net increase/(decrease) in short-term borrowings                                   19,000,000          (18,773,303)
    Issuance of common stock                                                              305,089               23,767
    Dividends paid                                                                       (758,539)                  --
                                                                                     ------------         ------------
    Net cash provided by financing activities                                          66,425,996           44,774,322
                                                                                     ------------         ------------

Increase in cash and cash equivalents                                                   3,459,305            2,951,721
Cash and cash equivalents at beginning of period                                       23,291,951           13,958,201
                                                                                     ------------         ------------
Cash and cash equivalents at end of period                                           $ 26,751,256         $ 16,909,922
                                                                                     ============         ============

Supplemental disclosures:
    Interest paid                                                                    $ 15,067,274         $ 12,204,343
                                                                                     ============         ============
    Income taxes paid                                                                $  1,825,000         $  1,775,000
                                                                                     ============         ============
</TABLE>

See Accompanying Notes



                                                                               6

<PAGE>   7


                             CAPITAL HOLDINGS, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     FOR THE SIX MONTHS ENDED JUNE 30, 1998

                                   (UNAUDITED)

BASIS OF PRESENTATION
---------------------

The unaudited consolidated financial statements include the accounts of Capital
Holdings, Inc. (the Company) and its wholly owned subsidiaries, Capital Bank,
N.A. (the Bank) and CBNA Building Company, which is a real estate subsidiary
that owns and leases to the Bank, its only operating facility.

The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions of Form 10-Q and Article 10 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. All adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. Significant
intercompany balances and transactions have been eliminated in the consolidated
financial statements. For further information refer to the consolidated
financial statements and notes thereto appearing in the Company's annual report
on Form 10-K for the year ended December 31, 1997.

The Bank's maximum exposure to credit losses for loan commitments and standby
letters of credit outstanding at June 30, 1998 was $204,246,000 and $14,724,000,
respectively, compared to $186,909,000 and $13,439,000, respectively, at
December 31, 1997. The increase in loan commitments is due to owner-occupied
real estate construction to take place within the next twelve months. Management
does not anticipate any significant losses as a result of these commitments.

COMPREHENSIVE INCOME
--------------------

As of January 1, 1998, the Company adopted Statement 130, Reporting
Comprehensive Income. Statement 130 establishes new rules for the reporting and
display of comprehensive income and its components; however, the adoption of
this Statement had no impact on the Company's net income or shareholders'
equity. Statement 130 requires unrealized gains or losses on the Company's
available-for-sale securities, which prior to adoption were reported separately
in shareholders' equity, to be included in other comprehensive income. Prior
year financial statements have been reclassified to conform to the requirements
of Statement 130.


                                                                               7

<PAGE>   8





                             CAPITAL HOLDINGS, INC.

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



The Company's primary asset is its subsidiary bank, which is in its ninth year
of operation. During the second quarter and for the six months ended June 30,
1998, the Bank experienced an increase in net deposits. Deposits increased
$44,327,000 or 7.4% for the second quarter and $47,879,000 or 8.06% during the
first half of 1998.

Loan growth for the second quarter of 1998 was $40,409,000 or 8.4% and
$52,458,000 or 11.2% for the first half of 1998. The allowance for credit losses
at June 30, 1998, was $7,423,000 or 1.4% of total loans, compared to $6,947,000
or 1.5% of total loans at December 31, 1997. The Bank had write offs totaling
$36,000 during the first half of 1998. This was the Bank's first loss in four
years. Nonperforming loans represent .08% of total loans at June 30, 1998.
Management considers the allowance to be adequate at this time. At June 30,
1998, the Bank had no impaired loans.

Securities available for sale totaled $178,682,000 or 24.2% of total assets at
June 30, 1998. The Bank continues to maintain very high investment quality with
81.7% of total securities in U.S. Treasury and Agency securities. The Bank has
no high-risk on or off balance-sheet derivatives. The total market value of the
portfolio increased $60,000 (net of tax) during the first half of 1998. This is
a reflection of the fluctuation in bond rates on both long and short-term
security maturities. The Bank's portfolio has a weighted average life to
maturity of approximately 2.3 years.

Consolidated net income for the second quarter of 1998 was $1,899,000 or $.94
per diluted share, and $3,718,000 or $1.84 per diluted share for the first half
of 1998. This compares to $1,705,000 or $.86 per diluted share for the second
quarter of 1997 and $3,299,000 or $1.67 per diluted share for the first half of
1997. The increase in income before provision for federal income taxes,
excluding securities gains, for the first half of 1998, represents a 14.1%
increase over the same period of 1997. This increase is a direct result of
growth in earning assets, careful attention to noninterest expenses and an
increase in fees collected on lending transactions. The income tax provision of
approximately 33% for the first half of 1998, remained comparable to the same
period last year.




                                                                               8



<PAGE>   9



                             CAPITAL HOLDINGS, INC.


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

Other expenses continue to increase as the Bank grows. Net overhead as a
percentage of average assets has increased only slightly from 1.77% for the year
ended December 31, 1997, to 1.78% for the first half of 1998. Salaries and
benefits represent 52.4% of other expenses for the second quarter of 1998,
compared to 53.5% for the second quarter of 1997. Salary expense for the first
half of 1998, increased 17.1% over the same period for 1997. Staff levels have
increased from 96 to 107 (full time equivalents) over the past 12 months, to
accommodate the increased growth of the bank. Average assets per employee has
increased from $6,203,000 at December 31, 1997, to $6,686,000 at June 30, 1998.

The Tier I Capital ratio was 9.43%, the Total Capital ratio was 10.68%, and the
Leverage ratio was 7.38% at June 30, 1998, compared to regulatory capital
requirements of 4%, 8% and 4%, respectively. These ratios are well in excess of
the regulatory capital requirements.

Shareholders equity has continued to increase from retained earnings of net
income. A $.21 per share cash dividend was declared on June 30, 1998, payable on
July 25, 1998. Annualized, this cash dividend represents 22% of the current
years projected earnings.

In June 1997, the Financial Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards (SFAS) No. 131, Disclosures about Segments of
an Enterprise and Related Information. The Company expects that adoption of this
Statement will not have a significant impact on the consolidated financial
statements.

In June 1998, the FASB issued Statement No. 133. "Accounting for Derivative
Instruments and Hedging Activities." SFAS No. 133 establishes accounting and
reporting standards for hedging activities and for derivative instruments,
including certain derivative instruments embedded in other contracts. This
statement requires a company to recognize all derivatives as either assets or
liabilities in its balance sheet and measure those instruments at fair value. If
certain conditions are met, a derivative may be specifically designated as a
fair value, cash flow, or foreign currency hedge. The accounting for changes in
the fair value of a derivative (i.e. gains and losses) depends on the intended
use of the derivative and the resulting designation. If the Company elects to
apply hedge accounting, it is required to establish at the inception of the
hedge the method it will use for assessing the effectiveness of the hedging
derivative and the measurement approach for determining the ineffective aspect
of the hedge. This statement is effective for all fiscal quarters of fiscal
years beginning after June 15, 1999. The Company plans to adopt this Statement
effective January 1, 2000. Presently the Company does not utilize derivative or
related types of financial instruments except for Federal agency collateralized
mortgage obligations. Therefore, this Statement is not anticipated to have a
material impact on the Company.


                                                                               9

<PAGE>   10




                             CAPITAL HOLDINGS, INC.




PART II.  OTHER INFORMATION
--------  -----------------



ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

At the Annual Shareholders Meeting held on May 7, 1998, pursuant to the Notice
of Annual Meeting and Proxy Statement dated April 13, 1998:

         1)    each of the five nominees were elected as directors
                  (1,402,540 votes for).

         2)    amendment to the Capital Holdings, Inc. 1996 Incentive Stock
                  Option Plan (1,360,370 votes for, 8,328 votes against, 33,842
                  votes abstained).



ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)      Exhibits

                  27       Financial Data Schedule


         (b)      No reports on Form 8-K were filed for the quarter ended 
                  June 30, 1998.




                                                                              10




<PAGE>   11



                                   SIGNATURES


Pursuant to the requirements for 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.





                                     CAPITAL HOLDINGS, INC.





Date  8/12/98                        /s/ Michael P. Killian
     -----------------------        --------------------------------------------
                                    Michael P. Killian, Chief Financial Officer,
                                              Senior Vice President








                                                                              11