SECURITIES AND EXCHANGE COMMISSION
                           Washington, D.C., 20549

                                  FORM 10-Q

  [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
                             
                         COMMISSION FILE NO: 0-17411
        
                       PARKVALE FINANCIAL CORPORATION
                      --------------------------------
           (Exact name of registrant as specified in its charter)


      PENNSYLVANIA                          25-1556590
     ---------------                      --------------
    (State of incorporation)             (I.R.S. Employer
                                          Identification Number)


         4220 William Penn Highway, Monroeville, Pennsylvania 15146 
       -------------------------------------------------------------
            (Address of principal executive offices; zip code)                
                                                                  
     Registrant's telephone number, including area code:  (412) 373-7200

           Securities registered pursuant to Section 12(b) of the Act:
                               Not Applicable
                                      
       Securities registered pursuant to Section 12(g) of the Act:

                       Common Stock ($1.00 par value)
                       ------------------------------
                               Title of Class


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

  The closing sales price of the Registrant's Common Stock on February 9,
  1996 was $28.50 per share.                                               
                                                
  Number of shares of Common Stock outstanding as of February 9, 1996 was
  3,206,574.<PAGE>




  PARKVALE FINANCIAL CORPORATION

  INDEX
  Part I.     Financial Information                          Page
  ----------------------------------                        -----

  Consolidated Statements of Financial Condition as 
  of December 31, 1995 and June 30, 1995                        3

  Consolidated Statements of Operations (Unaudited)
  for the Three and Six Months ended December 31, 1995
  and 1994                                                      4

  Consolidated Statements of Cash Flows (Unaudited)
  for the Six Months ended December 31, 1995 and 1994         5-6

  Consolidated Statements of Stockholders' Equity as 
  of December 31, 1995                                          6

  Notes to Unaudited Interim Consolidated Financial
  Statements                                                  7-9

  Management's Discussion and Analysis of Financial
  Condition and Results of Operations                       10-15

  Part II - Other Information                                  15

  Signatures                                                   15
























  


                                      2<PAGE>
                       PARKVALE FINANCIAL CORPORATION
               CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
               Dollar Amounts in Thousands, except share data)

                                                 December 31,   June 30,
                                     ASSETS          1995          1995  
                                                  -----------   -------- 
  Cash and noninterest-bearing deposits             $9,863      $10,003
  Federal funds sold                                76,776      116,581
  Interest-bearing deposits in other banks             377          194
  Investment securities available for sale
    (cost of $5,959 at December 31 and $5,890 
    at June 30)                                      9,500        8,738
  Loans available for sale (fair value of $21,106 
    at December 31)                                 20,981           --
  Investment securities (fair value of $125,942                        
    at December 31 and $123,348 at June 30)        125,880      123,817
  Mortgage-backed securities (fair value of 
    $103,706 at December 31 and $101,122 at 
    June 30)                                       102,289      100,881
  Loans, net                                       548,011      524,545
  Real estate owned, net of allowance of $0 at                         
    December 31 and June 30                          1,079           96
  Office properties and equipment, net               2,156        2,261
  Intangible assets and deferred charges               355          434
  Prepaid expenses and other assets                  8,442        8,872
                                                  --------     --------
                                   Total Assets   $905,709     $896,422
                                                  ========     ========
     LIABILITIES AND STOCKHOLDERS' EQUITY                 
  LIABILITIES                                             
  Savings deposits                                $800,858     $794,445
  Advances from Federal Home Loan Bank              20,699       20,607
  Escrow for taxes and insurance                     9,091       12,132
  Other liabilities                                  4,811        4,177
  Other debt                                         5,202        3,997
                                                  --------     --------
                              Total Liabilities   $840,661     $835,358
                                                  ========     ========
  STOCKHOLDERS' EQUITY                                    
  Preferred Stock ($1.00 par value; 5,000,000             
    shares authorized; 0 shares issued)                -            -  
  Common Stock ($1.00 par value; 10,000,000 
    shares authorized;December-3,448,736* 
    shares issued, June - 2,757,563 shares issued    3,449        2,758
  Additional Paid in Capital                         9,377       10,056
  Treasury Stock at cost (244,525* shares in 
    December and June)                              (3,434)      (3,434)
  Employee Stock Ownership Plan debt                  (108)        (154)
  Unrealized gains on securities available for 
    sale                                             2,248        1,808
  Retained earnings                                 53,516       50,030
                                                  --------     --------
                     Total Stockholders' Equity     65,048       61,064
                                                  --------     --------
     Total Liabilities and Stockholders' Equity   $905,709     $896,422
                                                  ========     ========
  * Reflect the effect of the 5 for 4 stock split on October 16,
  1995.                                                
                                     3<PAGE>


                       PARKVALE FINANCIAL CORPORATION
               UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
            (Dollar Amounts in Thousands, except per share data)
                                                                       
                                Three months ended  Six months ended
                                    December 31,       December 31,
                                   1995     1994       1995     1994
  Interest income:                -------  ------     ------   ------
     Loans                       $11,368  $10,225    $22,458  $20,188
     Mortgage-backed securities    1,743    1,734      3,495    3,527
     Investments                   1,986    2,215      3,930    4,320
     Federal funds sold            1,462      758      3,237    1,623
                                 -------  -------    -------   ------
     Total interest income        16,559   14,932     33,120   29,658
                                 -------  -------    -------   ------
  Interest expense:                                                  
     Savings deposits              9,588    8,093     19,268   16,189
     Borrowings                      397      395        790      788
                                 -------  -------    -------   ------
     Total interest expense        9,985    8,488     20,058   16,977
                                 -------  -------    -------   ------
  Net interest income              6,574    6,444     13,062   12,681
  Provision for loan losses          149      293        334      592
                                 -------  -------    -------   ------
  Net interest income after                                          
     provision for losses          6,425    6,151     12,728   12,089
                                 -------  -------    -------   ------
  Other income:                                                      
     Service charges and fees        418      405        812      797
     Gain on sale of assets            -        -          -        -
     Miscellaneous                   115       87        231      177
                                 -------  -------    -------   ------
     Total other income              533      492      1,043      974
                                 -------  -------    -------   ------
  Other expenses:                                                    
     Compensation and benefits     1,754    1,636      3,487    3,191
     Office occupancy                511      489      1,009      973
     Marketing                        81      125        141      195
     FDIC and other insurance        476      472        966      952
     Office supplies, telephone, 
       and postage                   208      207        398      400
     Miscellaneous                   574      544      1,124    1,069
                                 -------  -------    -------  -------
     Total other expense           3,604    3,473      7,125    6,780
                                 -------  -------    -------  -------
  Income before income taxes       3,354    3,170      6,646    6,283
  Income tax expense               1,172    1,160      2,321    2,335
                                 -------  -------    -------  -------
  Net income                      $2,182   $2,010     $4,325   $3,948
                                 =======  =======    =======  =======

  Net income per share             $0.65    $0.58      $1.29    $1.13
  Dividends per share              $0.13   $0.104      $0.26   $0.208
                                                            

  All share amounts reflect the effect of the 5 for 4 stock split on
  October 16, 1995.                    
                                      4<PAGE>

  Parkvale Financial Corporation
  CONSOLIDATED STATEMENTS OF CASH FLOWS
  For Six Months Ended December 31, 1995 and 1994
  Increase (Decrease) in Cash and Cash Equivalents
  (Dollar Amounts in Thousands) 
                                                     1995         1994    
                                                   -------      -------
  Cash flows from operating activities:                                
     Interest received                              $32,773      $29,690
     Loan fees received                                 144          208
     Other fees and commissions received                981          909
     Interest paid                                  (20,139)     (17,060)
     Cash paid to suppliers and others               (5,890)      (6,340)
     Income taxes paid                               (2,264)      (1,850)
                                                    -------      -------
     Net cash provided by operating activities        5,605        5,557

  Cash flows from investing activities:                                
     Proceeds from maturities of investments         55,700       35,070
     Purchase of investment securities available 
        for sale                                        (69)        (114)
     Purchase of investment securities              (57,573)     (44,767)
     (Purchase) maturity of deposits in other banks    (183)        1,283
     Purchase of mortgage-backed securities         (13,100)           --
     Purchase of loans                              (46,010)     (14,232)
     Proceeds from sales of loans                     1,382        1,231
     Principal collected on mortgage-backed 
        securities                                   11,692        9,318
     Principal collected on loans                    68,550       49,843
     Loans made to customers, net of loans in 
        process                                     (69,775)     (55,275)
     Other                                              (88)         (21)
                                                    -------      -------
       Net cash (used in) investing activities      (49,474)     (17,664)
                                                           
  Cash flows from financing activities:                                
     Net increase (decrease) in checking and                           
        and savings accounts                         (3,240)     (24,641)
     Net increase (decrease) in certificates of 
        deposit                                       9,654        5,189
     Proceeds from FHLB advances                         96           --
     Repayment of FHLB advances                          (5)         (92)
     Net increase in other borrowings                 1,205        1,068
     Decrease in borrowers' advances for tax & 
        insurance                                    (3,041)      (1,408)
     Cash dividends paid                               (756)        (635)
     Net proceeds from sale of common stock              11           16
     Sale (purchase) of treasury stock                   --         (418)
                                                    -------      -------
     Net cash (used in) financing activities          3,924      (20,921)
                                                    -------      -------
  Net (decrease) in cash and cash equivalents       (39,945)     (33,028)
                                                           
     Cash and equivalents at beginning of period    126,584       91,558
                                                    -------      -------
     Cash and equivalents at end of period          $86,639      $58,530
                                                    =======      =======
                                                   
                                      5<PAGE>
Reconciliation of net income to net cash            Six months ended
     provided by operating activities:                 December 31,
                                                     1995       1994    
                                                    -------    -------
  Net income                                       $4,325       $3,948
  Adjustments to reconcile net income to net 
     cash provided by operating activities:                           
     Depreciation and amortization                    272          283
     Accretion and amortization of loan fees 
        and discounts                                (247)          67
     Loan fees collected and deferred                 144          208
     Provision for loan losses                        334          592
     Increase in accrued interest receivable         (255)        (196)
     Decrease (increase) in other assets              354          (38)
     Decrease in accrued interest payable             (80)         (83)
     Increase in other liabilities                    758          776
                                                  -------      -------
     Total adjustments                              1,280        1,609
                                                  -------      -------
  Net cash provided by operating activities        $5,605       $5,557
                                                  =======      =======
  For  purposes of reporting cash flows, cash and cash equivalents include
  c a s h  and  noninterest-earning  deposits,  and  federal  funds  sold.
  Generally,  federal  funds  are  purchased and sold for one-day periods.
  Loans  transferred  to  foreclosed  assets  aggregated  $1.1 million and
  $ 9 0 ,000  in  the  six  months  ended  December  31,  1995  and  1994,
  respectively.
  <TABLE>
                                PARKVALE FINANCIAL CORPORATION
                        CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                           (Dollars in thousands, except share data)
  <CAPTION>                                        
                                                                             Employee                                   
                                                                               Stock     Unrealized                  Total
                                       Common       Paid-in     Treasury     Ownership    Security     Retained  Stockholders'
                                        Stock       Capital       Stock      Plan Debt     Gains       Earnings       Equity  
                                       -------      -------     --------     ---------   ---------     --------  -------------    
    <S>                                  <C>        <C>         <C>             <C>        <C>         <C>           <C>
    Balance, June 30, 1995               $2,758     $10,056     ($3,434)        ($154)     $1,808      $50,030       $61,064
                                                                                                                              
    Net income, six months ended 
      December 31, 1995                                                                                  4,325         4,325
                                                                                                               
    Dividends on common stock at 
      $.26 per share                                                                                      (839)         (839)
                                                                                                               
    Principal payments on employee 
      stock ownership plan debt                                                    69                                     69
                                                                                                               
    Transfer to reflect 5 for 4 split       690        (690)                                                               0
                                                                                                               
    Additional borrowings by ESOP                                                 (23)                                   (23)
                                                                                                               
    Unrealized security gains                                                                 440                        440
                                                                                                               
    Exercise of stock options                 1          11                                                               12
                                         -------    --------    --------        ------     -------     -------       -------    
    Balance, December 31, 1995           $3,449      $9,377    ($3,434)         ($108)     $2,248      $53,516       $65,048
                                         =======    ========    ========        ======     =======     =======       =======
    </TABLE>                                   6<PAGE>

  NOTES TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
  -----------------------------------------------------------------
  1.  STATEMENTS OF OPERATIONS
     The statements of operations for the three and six months ended
  December 31, 1995 and 1994 are unaudited, but in the opinion of
  management, reflect all adjustments (consisting of only normal recurring
  accruals) necessary for a fair presentation of the results of operations
  for those periods.  The results of operations for the three and six
  months ended December 31, 1995 are not necessarily indicative of the
  results which may be expected for fiscal 1996.  The Annual Report on
  Form 10-K for the year ended June 30, 1995 contains additional
  information and should be read in conjunction with this report.  

  2.  STOCK SPLIT
     On September 21, 1995 the Board of Directors declared a 5-for-4 stock
  split of Parkvale's common stock.  The additional shares were paid on
  October 16, 1995 to stockholders of record at the close of business on
  October 2, 1995.  This increased the outstanding shares by 640,706.  No
  fractional shares were issued.  All share amounts in this report have
  been restated to reflect this stock split. 

  3.  EARNINGS PER SHARE
     Primary earnings per share are based upon the weighted average number
  of issued and outstanding common shares including shares subject to
  stock options, which are deemed common stock equivalents.  For the three
  and six months ended December 31, 1995, earnings per share were $0.65
  and $1.29 per share based upon 3,367,129 and 3,361,768 average shares
  outstanding, respectively assuming all 256,837 option shares outstanding
  were exercised.  For the three and six months ended December 31, 1994,
  the restated earnings per share were $0.58 and $1.13 per share based
  upon 3,486,551 and 3,491,255 average shares outstanding, respectively
  assuming all 255,353 option shares then outstanding were exercised.

  4. CHANGE IN METHOD OF ACCOUNTING FOR CERTAIN INVESTMENTS
     In June 1993, the Financial Accounting Standards Board (FASB) issued
  Statement of Financial Accounting Standards No. 114, ("FAS 114"),
  "Accounting by Creditors for Impairment of a Loan," which was amended by
  FAS 118 in October 1994.  The Statements require all creditors to
  account for impaired loans, other than homogeneous loans such as
  residential or consumer loans, except those loans that are accounted for
  at fair value or at the lower of cost or fair value, at the present
  value of the expected future cash flows discounted at the loan's
  effective interest rate.  In accordance with the Statements, the Bank
  has adopted FAS 114 and 118 as of July 1, 1995.  (See Note 5.)

     In November 1995, the FASB issued a special report, "A Guide to
  Implementation of Statement 115 on Accounting for Certain Investments in
  Debt and Equity Securities," which provides an opportunity for a one
  time reassessment of the classification of the remaining held-to-
  maturity securities.  For comparative purposes, $21.0 million of loans
  have been reclassified as available for sale at December 31, 1995 and
  were reported using the cost basis at December 31, 1995.  The fair value
  of such loans was $21.1 million at December 31, 1995.

     In May 1995, the FASB issued FAS 122, "Accounting for Mortgage
  Servicing Rights."  This Statement amends certain provisions of
  Statement 65, "Accounting for Certain Mortgage Banking Activities," to
  allow enterprises engaging in mortgage banking activities to recognize
                                  7<PAGE>
                  
                                  
  as separate assets rights to service mortgage loans for loans originated
  by the enterprise.  The Bank has elected to adopt FAS 122 as of July 1,
  1995.  There was no impact on the results of operations for the six
  months ended December 31, 1995.

     In October 1995, the Financial Accounting Standards Board issued
  Statement of Financial Accounting Standards No. 123, ("FAS 123"),
  "Accounting for Stock-Based Compensation," which establishes a new
  method of accounting for stock-based compensation arrangements with
  employees.  The new method is a fair value based method rather than the
  intrinsic value based method that is currently utilized.  However, FAS
  123 does not require an entity to adopt the new fair value based method
  for purposes of preparing basic financial statements.  If an entity
  chooses not to adopt the new fair value based method, FAS 123 requires
  as entity to display in the footnotes pro forma net income and earnings
  per share information as if the fair value based method had been
  adopted.  FAS 123 is effective for financial statements with fiscal
  years beginning after December 15, 1995.  Currently, the Bank has not
  determined whether it will adopt the fair value based method and
  accordingly, cannot estimate the impact on the basic financial
  statements that FAS 123 will have upon adoption.  





































                                  8<PAGE>


  5.  LOANS:

  Loans are summarized as follows:
                                                 December 31,    June 30,
                                                     1995         1995    
                                                  ----------   ----------
                          (Dollar Amounts in Thousands)             
  First mortgage loans:                                             
      Residential:                                                     
      1-4 Family                                   $463,233     $423,439
      Multi-family                                   19,545       22,894
      Commercial                                     20,376       18,435
      Other                                           2,954        3,196
                                                   --------     --------
                                                    506,108      467,964
  Consumer loans                                     72,946       69,197
  Commercial business loans                           6,202        4,542
  Loans on savings accounts                           3,175        3,253
                                                   --------     --------
                                                    588,431      544,956
  Less:                                                   
      Loans in process                                3,584        4,816
      Allowance for loan losses                      13,532       13,136
      Unamortized discount and deferred loan fees     2,323        2,459
                                                   --------     --------
  Total Loan Portfolio                             $568,992     $524,545
      Less:  Loans available for sale                20,981           --
                                                   --------     --------
  Loans, net                                       $548,011     $524,545
                                                   ========     ========

  Nonaccrual loans                                   $1,300       $2,031
     as a percent of total assets                     0.14%        0.23%
                                                           
  The amount of additional interest income that had not been recognized in
  interest income was $69 at December 31, 1995 and $127 at June 30, 1995.
     
  The following summary sets forth the activity in the allowance for loan
  losses for the six months ended December 31: 
                                                     1995         1994    
                                                   -------      -------
  Beginning balance                                $13,136      $12,056
  Provision for losses - mortgage loans                221          525
  Provision for losses - consumer loans                113           67
  Provision for losses - commercial loans               --           --
  Loans recovered                                      120           12
  Loans charged off                                    (58)         (70)
                                                   -------      -------
  Ending balance                                   $13,532      $12,590
                                                   =======      =======

  Management considers non-accrual, substandard and doubtful commercial
  and other real estate loans to be potentially imparied under the
  provisions of FAS 114 and 118.  The collateral evaluation values of real
  estate are deemed to represent the most reliable indication of fair
  market value.
  
                                      9<PAGE>


                       PARKVALE FINANCIAL CORPORATION
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION 
                          AND RESULTS OF OPERATIONS
               ----------------------------------------------
            (Dollar Amounts in Thousands, except per share data)
                                                                        
  Balance Sheet Data:                            December 31,
                                                1995      1994    
                                               ------    ------
  Total assets                               $905,709  $858,810
  Loans receivable                            568,992   512,911
  Interest-bearing deposits and federal funds
     sold                                      77,153    49,121
  Investment and mortgage-backed securities   237,669   275,043
  Savings deposits                            800,858   759,103
  FHLB Advances                                20,699    20,612
  Other borrowings                              5,202     4,762
  Stockholders' Equity                         65,048    59,664
  Book value per share                         $20.30    $17.90
                                                                
  Statistical Profile:
                                    Three Months Ended   Six Months Ended
                                     December 31,  (1)   December 31,  (1)
                                         1995     1994     1995     1994   
                                        ------   ------   ------   ------
  Average yield earned on all                                         
   interest-earning assets              7.50%    7.11%     7.51%    6.99%
  Average rate paid on all                                           
   interest-bearing liabilities         4.85%    4.33%     4.87%    4.30%
  Average interest rate spread          2.66%    2.78%     2.64%    2.69%
  Net yield on average                                              
   interest-earning assets              2.98%    3.07%     2.96%    2.98%
  Other expenses to average assets      1.60%    1.62%     1.58%    1.57%
  Taxes to pre-tax income              34.94%   36.59%    34.92%   37.16%
  Return on average assets              0.97%    0.94%     0.96%    0.91%
  Return on average equity             14.00%   13.82%    14.08%   13.74%
  Average equity to average total 
   assets                               6.91%    6.78%     6.82%    6.65%
                                                            
                                                       
                                               At December 31,
                                                1995      1994    
                                               ------    ------
  One year gap to total assets                   5.55%     4.69%
  Intangibles to total equity                    0.55%     0.86%
  Capital to assets ratio                        7.18%     6.95%
  Ratio of nonperforming assets to total 
    assets                                       0.26%     0.19%
  Number of full-service offices                  28        27
                                                             
                                                             
                                                             
                                                             
  (1)  The applicable income and expense figures have been annualized in
  calculating the percentages.

 
                                      10<PAGE>
  RESULTS OF OPERATIONS - COMPARISON OF THREE MONTHS ENDED DECEMBER 31,
  1995 AND 1994.
  ----------------------------------------------------------------------

  For the three months ended December 31, 1995, Parkvale had net income of
  $2.2 million versus $2.0 million for the comparable period in 1994. 
  This increase was primarily due to a $130,000 increase in net interest
  income and a $144,000 decrease in loan loss provisions, which more than
  offset an increase in other expense of $131,000.  Net interest income
  for the quarter ended December 31, 1995 increased to $6.6 million from
  $6.4 million for the quarter ended December 31, 1994.  

  INTEREST INCOME:
  ----------------
  Parkvale had interest income of $16.6 million during the three months
  ended December 31, 1995 versus $14.9 million during the comparable
  period in 1994.  This $1.6 million or 10.9% increase is the result of a
  $42.5 million or 5.1% increase in the average balance of interest-
  earning assets, compounded by a 39 basis point increase in the average
  yield from 7.11% in 1994 to 7.50% in 1995.  Interest income from loans
  increased $1.1 million or 11.2% as a result of a $36.2 million or 7.1%
  increase in the average outstanding loan balances, compounded by an
  increase in the average yield from 8.01% to 8.32%.  Interest income on
  mortgage-backed securities increased slightly  by $9,000 from the 1994
  quarter due to an increase in the average yield from 6.49% to 6.69%,
  offset by a $2.7 million decrease in the average balance.  Investment
  securities interest income decreased by $229,000 or 10.3% from the 1994
  quarter.  Although the average yield on investments increased by  61
  basis points from 5.39% to 6.00%, this was not sufficient to offset an
  average investment balance decrease of  $31.9 million or 19.4%. 
  Interest income earned on Federal funds sold increased $704,000 from the
  1994 quarter due to an increase in the average balance of $40.8 million,
  magnified by a 71 basis point increase in the average yield from 5.17%
  to 5.88%.  At December 31, 1995, the weighted average yield on all
  interest earning assets was 7.50%.

  INTEREST EXPENSE:
  -----------------
  Interest expense increased $1.5 million or 17.6% from the 1994 to the
  1995 quarter.  The increase was due to a $39.1 million or 5.0% increase
  in the average deposits and borrowings, compounded by an increase in the
  average rate paid on deposits and borrowings from 4.33% in 1994 to 4.85%
  in 1995.  At December 31, 1995, the average rate payable on liabilities
  was 4.81% for deposits, 6.20% for borrowings and 4.85% for combined
  deposits and borrowings.

  PROVISION FOR LOAN LOSSES:
  --------------------------
  Parkvale's provision for loan losses decreased by $144,000 or 49.2% from
  the 1994 to the 1995 quarter.  The aggregate general valuation
  allowances were 1.47% of total assets at December 31, 1995, versus 1.44%
  and 1.43% at June 30, 1995 and December 31, 1994.

  Non-performing loans and real estate owned were $2.4 million, $2.1
  million and $1.6 million at December 31, 1995, June 30, 1995 and
  December 31, 1994, representing 0.26%, 0.24% and 0.19% of total assets
  at the respective balance sheet dates.  Total loan loss reserves at
  December 31, 1995 were $13.5 million, which represents 2.35% of the net
                                  
                                  11<PAGE>

  loan portfolio.  The increase of $252,000 in non-performing assets from
  June 30, 1995 is primarily due to increased non-accrual, commercial
  mortgage loans.  The increase of $752,000 in non-performing assets from
  December 31, 1994 to December 31, 1995 is due to the transfer of an
  $899,000 first mortgage loan on a multi-family residential apartment 
  complex into real estate owned.  Such REO is slated for sale in February    
  1996 without a loss.

  Loans are placed on non-accrual status when in the judgement of
  management, the probability of collection of interest is deemed to be
  insufficient to warrant further accrual.  All loans which are 90 or more
  days delinquent are treated as non-accrual loans.

  OTHER INCOME:
  -------------
  Total other income increased by $41,000 or 8.3% from 1994 to 1995
  primarily due to a $46,000 increase in income from the tax deferred
  annuity and mutual fund products.

  OTHER EXPENSE:
  --------------
  Total other expense increased by $131,000 or 3.8% primarily from an
  $118,000 increase in compensation and employee benefit expenses. 
  Annualized operating expenses as a percentage of average assets were
  1.60% for the quarter ended December 31, 1995 versus 1.62% during the
  comparable 1994 quarter.

  Compensation and employee benefit expenses increased $118,000 or 7.2%
  for the comparable quarter in 1994.  This increase represents merit pay
  increases and the staffing costs for an additional office opened in
  February 1995.  


  RESULTS OF OPERATION - COMPARISON OF SIX MONTHS ENDED DECEMBER 31, 1995
  AND 1994
  -----------------------------------------------------------------------

  For the six months ended December 31, 1995, Parkvale had net income of
  $4.3 million versus $3.9 million for the comparable period in 1994. 
  This $377,000 increase was due mainly to an increase in net interest
  income of $381,000 and a reduced provision for loan losses of $258,000,
  which more than offset an increase operating expenses of $345,000. Net
  interest income for the six months ended December 31, 1995 increased to
  $13.1 million from $12.7 million for the six months ended December 31,
  1994 as a direct result of higher interest rates.  The average interest
  rate spread decreased slightly from 2.69% in 1994 to 2.64% in 1995.
 
  INTEREST INCOME:
  ----------------
  Parkvale had interest income of $33.1 million during the six months
  ended December 31, 1995 and $29.6 million during the comparable period
  in 1994.  This 3.5 million or 11.7% increase is attributable to an
  increase in the average interest-earning asset portfolio of $33.6
  million, magnified by a 52 basis point increase in the average yield
  from 6.99% in 1994 to 7.51% in 1995.  Interest income from loans
  increased $2.3 million or 11.2%.  The average yield increased from 8.01%
  in 1994 to 8.32% in 1995 and the average loan balance increased $35.5
  
                                  12<PAGE>
  
  million.  Interest income on mortgage-backed securities declined
  slightly by $32,000 or 0.9% from the first six months of the previous
  fiscal year.  This was due to a decrease in the average portfolio of
  $5.3 million, offset by an increase in the average yield from 6.46% to
  6.74%.  Income from investments decreased by $390,000 or 9.0% from 1994. 
  Although the average yield increased 96 basis points from 5.14% to
  6.10%, the average balance decreased significantly by $39.3 million or
  23.4%.   Federal funds sold income increased $1.6 million or 99.5% from
  the prior six months ended December 1994.  This was due to a $42.8
  million increase in the average balance and a 105 basis point increase
  in the average yield from 4.85% in 1994 to 5.90% in 1995.

  INTEREST EXPENSE:
  -----------------
  Interest expense increased $3.1 million or 18.2% from the 1994 six month
  period to the 1995 six month period.  The increase was due to a $33.9
  million or 4.3% increase in the average deposits and borrowings, 
  compounded by a 57 basis point increase in the average rate paid on 
  deposits and borrowings from 4.30% in 1994 to 4.87% in 1995.    

  PROVISION FOR LOAN LOSSES:
  --------------------------
  Parkvale's provision for loan losses decreased by $258,000 or 43.6% from
  the 1994 to the 1995 period.  The aggregate general valuation allowances
  were 1.47%, 1.44% and 1.43% of total assets at December 31, 1995, June
  30, 1995 and December 31, 1994, respectively.   

  OTHER INCOME:
  -------------
  Other income increased slightly by $69,000 or 7.1% due primarily to an
  $83,000 increase of income from tax deferred annuities.

  OTHER EXPENSES:
  ---------------
  Other expenses increased by $345,000 or 5.1% for the six month period
  ending December 31, 1995 compared to the same period in 1994.  This
  change was from an increase in compensation and benefit expenses.   

  Compensation and benefit expenses increased $296,000 or 9.3% during the
  six month period ended December 31, 1995 as a result of merit pay and
  benefit expense increases. 
  
  INCOME TAXES:
  -------------
  The provision for income taxes under FAS 109 consists of the following
  for the six months ended December 31, 1994:  Current provision - Federal
  $1,916,000; State $327,000 and Deferred Federal $78,000 with the total
  aggregating $2,321,000.  The deferred tax asset decreased by $315,000
  from June 30, 1995 to December 31, 1995 which primarily reflects the tax
  effect of appreciation in assets classified as available for sale under
  FAS 115.  The effective tax rate for the six months ended December 31,
  1995 was 34.9% and 37.2% for the comparable period in 1994.   






                                  13<PAGE>

  LIQUIDITY AND CAPITAL RESOURCES:
  --------------------------------
  The loan portfolio increased $44.4 million from June 30, 1995 to
  December 31, 1995 resulting from the combination of the deployment of
  funds from investments in federal funds sold and an increase in deposit
  balances of $6.4 million.  Federal funds sold decreased by $39.8
  million.  
    
  Stockholders' equity was $65.0 million or 7.18% of total assets at
  December 31, 1995.  The Bank is required to maintain Tier I (Core)
  capital equal to at least 4% of the institution's adjusted total assets,
  and Tier II (Supplementary) risk-based capital equal to at least 8% of
  the risk-weighted assets.  At December 31, 1994, Parkvale was in
  compliance with all applicable regulatory requirements, with Tier I and
  Tier II ratios of 6.77% and 13.87%, respectively.

  The following table sets forth certain information concerning the Bank's
  regulatory capital at December 31, 1995:          
                                         Tier I    Tier I     Tier II
                                          Core   Risk-Based Risk-Based
                                        Capital   Capital    Capital   
                                         ------    ------     ------
  Equity Capital (1)                    $64,593   $64,593    $64,593
  Less non-allowable intangible assets    (355)     (355)      (355)
  Less Unrealized securities gains      (2,195)   (2,195)    (2,195)
  Plus general valuation allowances (2)     --        --       6,145
                                        -------   -------    -------
     Total regulatory capital            62,043    62,043     68,188
  Minimum required capital               36,640    19,665     39,329
                                        -------   -------    -------
     Excess regulatory capital          $25,403   $42,378    $28,859
                                        =======   =======    =======
  Regulatory capital as a percentage (3)   6.77%    12.62%     13.87%
  Minimum capital required as a 
     percentage                            4.00%     4.00%      8.00%
  Excess regulatory capital as a          ------    ------     ------ 
     percentage                            2.77%     8.62%      5.87%
                                          ======    ======     ======
  (1)  Represents equity capital of the consolidated Bank as reported to
  the Pennsylvania Department of Banking and FDIC on Form 032 for the
  quarter ended December 31, 1995.
  (2)  Limited to 1.25% of risk adjusted total assets.
  (3)  Tier I  capital is computed as a percentage of adjusted total
  assets of $916,002.  Tier I and Tier II risk-based capital are  computed
  as a percentage of adjusted risk-weighted assets of $491,614.

  As part of the budget reconciliation process, it appears that Congress
  has focused on reaching a fair and balanced solution to the much
  discussed and highly controversial Bank Insurance Fund/Savings
  Association Insurance Fund (BIF/SAIF) issue.  As the package stands now,
  it appears that there will be a one-time assessment on SAIF-insured
  deposits of 85-90 basis points to recapitalize SAIF.  While the one-time
  assessment to Parkvale would amount to approximately $6.8 million on a
  pre-tax basis, it would allow SAIF-insured institutions like Parkvale to
  compete on equal footing with BIF insured institutions by eliminating
  the current yearly deposit insurance premium disparity by reducing the
  premium from 23 basis points to 4 basis points per $100 of insured
  
                                  14<PAGE>
  
  deposits.  This would reduce Parkvale's annual FDIC deposit insurance
  costs by approximately $1.5 million.  Parkvale enthusiastically supports
  the payment of a one-time assessment as a means of recapitalizing SAIF
  and successfully resolving the BIF/SAIF premium disparity.  

  Management is not aware of any trends, events, uncertainties or current
  recommendations by any regulatory authority that will have (if
  implemented), or that are reasonably likely to have, material effects on
  Parkvale's liquidity, capital resources or operations.

  IMPACT OF INFLATION AND CHANGING PRICES:
  ----------------------------------------
  The financial statements and related data presented herein have been
  prepared in accordance with generally accepted accounting principles,
  which require the measurement of financial position and operating
  results in terms of historical dollars without considering changes in
  the relative purchasing power of money over time due to inflation. 
  Unlike most industrial companies, substantially all of the assets and
  liabilities of a financial institution are monetary in nature.  As a
  result, interest rates have a more significant impact on a financial
  institution's performance than the effects of general levels of
  inflation.  Interest rates do not necessarily move in the same direction
  or in the same magnitude as the prices of goods and services as measured
  by the consumer price index.

  PART II - OTHER INFORMATION
  ----------------------------
  Item 1.  Legal Proceedings                                None
  Item 2.  Changes in Securities                            N/A
  Item 3.  Defaults Upon Senior Securities                  N/A
  Item 4.  Submission of Matters to a Vote of Security                
           Holders                                          None
  Item 5.  Other Information                                None
  Item 6.  Exhibits and Reports on Form 8-K
      (a)  Exhibits                                         None
      (b)  Reports on Form 8-K                              None
                                      
                                 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.
                                        
                                        Parkvale Financial Corporation

  DATE: February 13, 1996                By:  Robert J. McCarthy, Jr.
                                            ---------------------------
                                            Robert J. McCarthy, Jr.
                                            President and Chief Executive
                                             Officer

  DATE: February 13, 1996                By:  Timothy G. Rubritz
                                            -----------------------    
                                            Timothy G. Rubritz
                                            Vice President - Treasurer
                                             (Chief Financial Officer)


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