FORM 10-QSB

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549

(Mark One)

[X]           QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
                                      OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended          September 30, 1998         
                               --------------------------------------------

                                       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 2-47541

                              RIVER VALLEY BANCORP
             (Exact name of registrant as specified in its charter)

         Indiana                                             35-1984567 
(State or other jurisdiction of                           (I.R.S. Employer
incorporation or organization)                         Identification Number)

  303 Clifty Drive
  Madison, Indiana                                               47250 
(Address of principal                                         (Zip Code)
 executive office)

Registrant's telephone number, including area code: (812) 265-3421

Check  whether  the issuer  (1) has filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Securities  Exchange  Act of 1934 during the past 12
months (or for such shorter period that the registrant was required to file such
reports)  and (2) has been subject to such filing  requirements  for the past 90
days.

Yes   X                                                        No      

As of November 12, 1998, the latest  practicable  date  1,191,440  shares of the
registrant's common stock, without par value, were issued and outstanding.









                               Page 1 of 20 pages

<PAGE>


                              River Valley Bancorp

                                      INDEX

                                                                       Page

PART I  - FINANCIAL INFORMATION

            Consolidated Statements of Financial Condition                 3

            Consolidated Statements of Earnings                            4

            Consolidated Statements of Comprehensive Income                5

            Consolidated Statements of Cash Flows                          6

            Notes to Consolidated Financial Statements                     8

            Management's Discussion and Analysis of
            Financial Condition and Results of
            Operations                                                    12


PART II - OTHER INFORMATION                                               19

SIGNATURES                                                                20





























                                        2



<PAGE>

<TABLE>

                              River Valley Bancorp
<CAPTION>
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                        (In thousands, except share data)

                                                                                      September 30,        December 31,
         ASSETS                                                                                1998                1997
<S>                                                                                         <C>                 <C>
Cash and due from banks                                                                    $  3,849            $  3,542
Federal funds sold                                                                              800                 300
Interest earning deposits in other financial institutions                                     1,551               1,026
                                                                                            -------             -------
         Cash and cash equivalents                                                            6,200               4,868

Certificates of deposit in other financial institutions                                         100                 897
Investment securities designated as available for sale - at market                              783                 772
Investment securities - at amortized cost, approximate market value of
  $981 and $3,444 as of September 30, 1998 and December 31, 1997                                966               3,500
Mortgage-backed securities designated as available for sale - at market                       2,906               3,604
Mortgage-backed and related securities - at cost, approximate market
  value of $3,451 and $5,432 as of September 30, 1998 and December 31, 1997                   3,516               5,374
Loans receivable - net                                                                      113,059             111,319
Loans held for sale - at lower of cost or market                                              2,406                 684
Office premises and equipment - at depreciated cost                                           2,054               2,065
Real estate acquired through foreclosure                                                         82                  82
Federal Home Loan Bank stock - at cost                                                          943                 943
Accrued interest receivable on loans                                                          1,062                 916
Accrued interest receivable on mortgage-backed and related securities                            71                 117
Accrued interest receivable on investments and interest-earning deposits                         31                  65
Goodwill, net of accumulated amortization                                                       225                 245
Cash surrender value of life insurance                                                          809                 776
Prepaid expenses and other assets                                                               200                 141
Prepaid federal income taxes                                                                    137                  - 
Deferred tax asset                                                                              765                 681
                                                                                            -------             -------

         Total assets                                                                      $136,315            $137,049
                                                                                            =======             =======

         LIABILITIES AND STOCKHOLDERS' EQUITY

Deposits                                                                                   $111,152            $114,955
Advances from the Federal Home Loan Bank                                                      5,000               2,000
Advances by borrowers for taxes and insurance                                                    52                  53
Accrued interest payable                                                                        414                 463
Other liabilities                                                                             1,255               1,524
Dividends payable                                                                                65                  60
Accrued federal income taxes                                                                     -                    5
                                                                                            -------             -------
         Total liabilities                                                                  117,938             119,060

Stockholders' equity
  Preferred stock - 2,000,000 shares without par value
    authorized; no shares issued                                                                 -                   - 
  Common stock - 5,000,000 shares without par value authorized;
    1,191,440 and 1,190,250 shares issued and outstanding at
    September 30, 1998 and December 31, 1997                                                     -                   - 
  Additional paid in capital                                                                 11,247              11,229
  Retained earnings - substantially restricted                                                8,579               7,797
  Shares acquired by stock benefit plans                                                     (1,434)             (1,005)
  Unrealized losses on securities designated as available for sale,
    net of related tax effects                                                                  (15)                (32)
                                                                                            -------             -------
         Total stockholders' equity                                                          18,377              17,989
                                                                                            -------             -------

         Total liabilities and stockholders' equity                                        $136,315            $137,049
                                                                                            =======             =======

</TABLE>


                                        3


<PAGE>

<TABLE>

                              River Valley Bancorp
<CAPTION>

                       CONSOLIDATED STATEMENTS OF EARNINGS

                        (In thousands, except share data)

                                                                         Nine months ended            Three months ended
                                                                            September 30,                September 30,
                                                                         1998         1997            1998         1997
<S>                                                                      <C>          <C>             <C>          <C>
Interest income
  Loans                                                                $7,012       $6,834          $2,436       $2,347
  Mortgage-backed and related securities                                  368          564             119          180
  Investment securities                                                   131          220              27           64
  Interest-earning deposits and other                                     181          261              53           65
                                                                        -----        -----           -----        -----
         Total interest income                                          7,692        7,879           2,635        2,656

Interest expense
  Deposits                                                              3,505        3,654           1,159        1,203
  Borrowings                                                              137           93              81           59
                                                                        -----        -----           -----        -----
         Total interest expense                                         3,642        3,747           1,240        1,262
                                                                        -----        -----           -----        -----

         Net interest income                                            4,050        4,132           1,395        1,394

Provision for losses on loans                                             215          238              65           68
                                                                        -----        -----           -----        -----

         Net interest income after provision for losses on loans        3,835        3,894           1,330        1,326

Other income
  Insurance commissions                                                    -            10              -             3
  Loss on sale of investment and mortgage-backed securities                -            (4)             -            (7)
  Gain on sale of loans                                                   202           73              75           59
  Gain (loss) on sale of office premises and equipment                     57          202              57           (1)
  Service fees, charges and other operating                               634          589             223          192
                                                                        -----        -----           -----        -----
         Total other income                                               893          870             355          246

General, administrative and other expense
  Employee compensation and benefits                                    1,815        1,663             647          581
  Occupancy and equipment                                                 348          376             125          128
  Federal deposit insurance premiums                                       32           27              12           12
  Amortization of goodwill                                                 20           20               7            6
  Data processing                                                          86          189              30           56
  Other operating                                                         813          849             296          281
                                                                        -----        -----           -----        -----
         Total general, administrative and other expense                3,114        3,124           1,117        1,064
                                                                        -----        -----           -----        -----

         Earnings before income taxes                                   1,614        1,640             568          508

Income taxes
  Current                                                                 734          685             424          197
  Deferred                                                                (93)         (25)           (195)          (4)
                                                                        -----        -----           -----        -----
         Total income taxes                                               641          660             229          193
                                                                        -----        -----           -----        -----

         NET EARNINGS                                                  $  973       $  980          $  339       $  315
                                                                        =====        =====           =====        =====

         EARNINGS PER SHARE
           Basic                                                         $.88         $.90            $.31         $.29
                                                                          ===          ===             ===          ===

           Diluted                                                       $.86         $.89            $.30         $.29
                                                                          ===          ===             ===          ===
</TABLE>


                                        4


<PAGE>


<TABLE>
                              River Valley Bancorp
<CAPTION>

                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

                     For the nine months ended September 30,
                                 (In thousands)

                                                                                                 1998              1997
<S>                                                                                                <C>              <C>
Net earnings                                                                                     $973              $980

Unrealized holding gains (losses) during the period, net of tax                                   (17)               - 

Reclassification adjustment for losses on sale of securities included
  in net earnings, net of related taxes                                                            -                  2
                                                                                                  ---               ---

Comprehensive income                                                                             $956              $982
                                                                                                  ===               ===

Accumulated other comprehensive losses                                                           $(15)             $(49)
                                                                                                  ===               === 

</TABLE>

































                                        5



<PAGE>

<TABLE>

                              River Valley Bancorp
<CAPTION>

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                     For the nine months ended September 30,
                                 (In thousands)

                                                                                                 1998              1997
<S>                                                                                              <C>                <C>
Cash flows from operating activities:
  Net earnings for the period                                                                 $   973           $   980
  Adjustments to reconcile net earnings to net cash provided
  by (used in) operating activities:
    Amortization of premiums  and discounts on investments and
      mortgage-backed securities - net                                                             13                (5)
    Loss on sale of investment and mortgage-backed  securities designated
      as available for sale                                                                        -                  4
    Loans originated for sale in the secondary market                                         (12,763)           (5,415)
    Proceeds from sale of loans in the secondary market                                        11,144             6,521
    Gain on sale of loans                                                                        (103)              (30)
    Amortization of deferred loan origination costs                                                75                 5
    Provision for losses on loans                                                                 215               238
    Depreciation and amortization                                                                 170               147
    Amortization of goodwill                                                                       20                20
    Gain on sale of office premises and equipment                                                 (57)             (202)
    Increase (decrease) in cash due to changes in:
      Accrued interest receivable on loans                                                       (146)             (159)
      Accrued interest receivable on mortgage-backed securities                                    46                16
      Accrued interest receivable on investments and interest-bearing deposits                     34               115
      Prepaid expenses and other assets                                                           (59)               77
      Accrued interest payable                                                                    (49)              (41)
      Other liabilities                                                                          (264)              231
      Income taxes
        Current                                                                                  (142)              (35)
        Deferred                                                                                  (93)              (25)
                                                                                               ------            ------
         Net cash provided by (used in) operating activities                                     (986)            2,442

Cash flows provided by (used in) investing activities:
  Proceeds from maturity of investment securities                                               2,500             2,000
  Proceeds from sale of investment securities designated as available for sale                     -              2,698
  Proceeds from sale of mortgage-backed securities designated as available for sale                -              1,473
  Purchase of mortgage-backed securities                                                           -             (1,010)
  Principal repayments on mortgage-backed securities                                            2,570             1,886
  Loan principal repayments                                                                    28,621            24,034
  Loan disbursements                                                                          (30,640)          (28,966)
  Purchase of Federal Reserve Bank stock                                                           -                (64)
  Purchase of office equipment                                                                   (159)             (107)
  Proceeds from sale of office premises and equipment                                              68               407
  (Increase) decrease in certificates of deposit in other financial institutions - net            797              (796)
  Increase in cash surrender value of life insurance                                              (33)              (26)
                                                                                               ------            ------
         Net cash provided by investing activities                                              3,724             1,529
                                                                                               ------            ------

         Net cash provided by operating and investing
           activities (subtotal carried forward)                                                2,738             3,971
                                                                                               ------            ------

</TABLE>

                                        6


<PAGE>

<TABLE>

                              River Valley Bancorp
<CAPTION>

                CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

                     For the nine months ended September 30,
                                 (In thousands)

                                                                                                 1998              1997
<S>                                                                                              <C>                <C>
         Net cash provided by operating and investing
           activities (subtotal brought forward)                                              $ 2,738            $3,971

Cash flows provided by (used in) financing activities:
  Net decrease in deposit accounts                                                             (3,803)           (9,980)
  Proceeds from Federal Home Loan Bank advances                                                12,221             5,000
  Repayment of Federal Home Loan Bank advances                                                 (9,221)           (3,100)
  Advances by borrowers for taxes and insurance                                                    (1)                4
  Dividends on common stock                                                                      (191)              (95)
  Purchase of shares for stock benefit plans                                                     (429)              (81)
  Proceeds from exercise of stock options                                                          18                - 
                                                                                               ------             -----
         Net cash used in financing activities                                                 (1,406)           (8,252)
                                                                                               ------             -----

Net increase (decrease) in cash and cash equivalents                                            1,332            (4,281)

Cash and cash equivalents at beginning of period                                                4,868             8,685
                                                                                               ------             -----

Cash and cash equivalents at end of period                                                    $ 6,200            $4,404
                                                                                               ======             =====


Supplemental disclosure of cash flow information: Cash paid during the year for:
    Federal income taxes                                                                      $   516            $  438
                                                                                               ======             =====

    Interest on deposits and borrowings                                                       $ 3,691            $3,788
                                                                                               ======             =====


Supplemental disclosure of noncash investing activities:
  Transfers from loans to real estate acquired through foreclosure                            $    -             $   82
                                                                                               ======             =====

  Unrealized gains on securities designated as available
    for sale, net of related tax effects                                                      $    17            $    2
                                                                                               ======             =====

  Recognition of mortgage servicing rights in accordance with
    SFAS No. 125                                                                              $    99            $   43
                                                                                               ======             =====


</TABLE>








                                        7



<PAGE>


                              River Valley Bancorp

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     For the nine and three month periods ended September 30, 1998 and 1997


River Valley  Bancorp (the  "Corporation")  is a financial  institution  holding
company whose  activities  are  primarily  limited to holding the stock of River
Valley  Financial  Bank  ("River  Valley" or the  "Bank").  The Bank  conducts a
general banking  business in  southeastern  Indiana which consists of attracting
deposits from the general public and applying those funds to the  origination of
loans  for  consumer,   residential  and  commercial   purposes.   River  Valley
Financial's  profitability  is  significantly  dependent on net interest income,
which is the difference between interest income generated from  interest-earning
assets  (i.e.   loans  and   investments)  and  the  interest  expense  paid  on
interest-bearing  liabilities (i.e.  customer deposits and borrowed funds).  Net
interest  income is affected by the relative amount of  interest-earning  assets
and  interest-bearing  liabilities  and the  interest  received or paid on these
balances.  The  level of  interest  rates  paid or  received  by the Bank can be
significantly   influenced  by  a  number  of  competitive   factors,   such  as
governmental monetary policy, that are outside of management's control.

1.  Basis of Presentation

The accompanying  unaudited  consolidated  financial statements were prepared in
accordance  with  instructions  for Form 10-QSB and,  therefore,  do not include
information  or footnotes  necessary  for a complete  presentation  of financial
position,  results of  operations  and cash flows in conformity  with  generally
accepted accounting principles.  Accordingly,  these financial statements should
be read in  conjunction  with the  consolidated  financial  statements and notes
thereto of the Corporation  included in the Annual Report on Form 10-KSB for the
year ended  December  31,  1997.  However,  in the  opinion of  management,  all
adjustments  (consisting of only normal recurring  accruals) which are necessary
for a fair  presentation  of the financial  statements  have been included.  The
results of operations  for the nine and three month periods ended  September 30,
1998 are not necessarily indicative of the results which may be expected for the
entire year.

2.  Principles of Consolidation

The consolidated  financial  statements  include the accounts of the Corporation
and its subsidiary,  the Bank and the Bank's  subsidiary,  Madison First Service
Corporation  ("First  Service").   All  significant  intercompany  balances  and
transactions  have been eliminated in the  accompanying  consolidated  financial
statements.

3.  Effect of Recent Accounting Pronouncements

In September 1996, the Financial  Accounting Standards Board (the "FASB") issued
Statement of Financial  Accounting  Standards ("SFAS") No. 125,  "Accounting for
Transfers and Servicing of Financial Assets and Extinguishments of Liabilities",
that provides accounting guidance on transfers of financial assets, servicing of
financial assets, and extinguishment of liabilities.  SFAS No. 125 introduces an
approach to accounting  for transfers of financial  assets that provides a means
of dealing with more complex transactions in which the seller disposes of only a
partial  interest in the assets,  retains  rights or  obligations,  makes use of
special  purpose  entities  in the  transaction,  or  otherwise  has  continuing
involvement with the transferred assets. The new accounting method,  referred to
as the financial components approach, provides that the carrying



                                        8


<PAGE>


                              River Valley Bancorp

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     For the nine and three month periods ended September 30, 1998 and 1997


3.  Effect of Recent Accounting Pronouncements (continued)

amount of the  financial  assets  transferred  be allocated to components of the
transaction based on their relative fair values.  SFAS No. 125 provides criteria
for determining  whether control of assets has been  relinquished  and whether a
sale has  occurred.  If the transfer does not qualify as a sale, it is accounted
for as a secured borrowing.  Transactions  subject to the provisions of SFAS No.
125  include,   among  others,   transfers  involving   repurchase   agreements,
securitizations   of   financial   assets,   loan   participations,    factoring
arrangements, and transfers of receivables with recourse.

An entity that undertakes an obligation to service  financial assets  recognizes
either a servicing asset or liability for the servicing contract (unless related
to a securitization of assets,  and all the securitized  assets are retained and
classified  as  held-to-maturity).  A  servicing  asset  or  liability  that  is
purchased or assumed is initially recognized at its fair value. Servicing assets
and  liabilities are amortized in proportion to and over the period of estimated
net  servicing  income  or net  servicing  loss and are  subject  to  subsequent
assessments for impairment based on fair value.

SFAS No. 125 provides that a liability is removed from the balance sheet only if
the debtor  either pays the creditor and is relieved of its  obligation  for the
liability or is legally released from being the primary obligor.

SFAS No. 125 is effective for  transfers  and servicing of financial  assets and
extinguishment  of liabilities  occurring  after December 31, 1997, and is to be
applied  prospectively.  Earlier or  retroactive  application  is not permitted.
Management adopted SFAS No. 125 effective January 1, 1998, as required,  without
material effect on River Valley's consolidated  financial position or results of
operations.

In  September  1997,  the FASB  issued SFAS No.  130,  "Reporting  Comprehensive
Income."  SFAS No.  130  establishes  standards  for  reporting  and  display of
comprehensive income and its components (revenues,  expenses,  gains and losses)
in a full set of  general-purpose  financial  statements.  SFAS No. 130 requires
that all items that are required to be recognized under accounting  standards as
components of comprehensive  income be reported in a financial statement that is
displayed with the same  prominence as other financial  statements.  It does not
require a specific  format for that  financial  statement  but requires  that an
enterprise  display an amount  representing total  comprehensive  income for the
period in that financial statement.

SFAS  No.  130  requires  that  an  enterprise   (a)  classify  items  of  other
comprehensive  income by their nature in a financial  statement  and (b) display
the accumulated balance of other  comprehensive  income separately from retained
earnings and additional  paid-in capital in the equity section of a statement of
financial  position.  SFAS No. 130 is effective for fiscal years beginning after
December 15, 1997.  Reclassification of financial statements for earlier periods
provided for comparative  purposes is required.  Management adopted SFAS No. 130
effective  January  1,  1998,  as  required,  without  material  effect  on  the
Corporation's financial statements.



                                        9



<PAGE>


                              River Valley Bancorp

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     For the nine and three month periods ended September 30, 1998 and 1997


3.  Effect of Recent Accounting Pronouncements (continued)

In September 1997, the FASB issued SFAS No. 131,  "Disclosures about Segments of
an Enterprise and Related  Information." SFAS No. 131 significantly  changes the
way that public business enterprises report information about operating segments
in annual  financial  statements  and  requires  that those  enterprises  report
selected  information  about reportable  segments in interim  financial  reports
issued to shareholders.  It also establishes  standards for related  disclosures
about products and services,  geographic areas and major customers. SFAS No. 131
uses a "management  approach" to disclose financial and descriptive  information
about the way that  management  organizes the segments within the enterprise for
making operating decisions and assessing performance.  For many enterprises, the
management  approach  will likely  result in more segments  being  reported.  In
addition,  SFAS No. 131 requires  significantly more information to be disclosed
for each reportable segment than is presently being reported in annual financial
statements  and also requires that selected  information  be reported in interim
financial statements. SFAS No. 131 is effective for fiscal years beginning after
December 15, 1997. SFAS No. 131 is not expected to have a material impact on the
Corporation's financial statements.

In June  1998,  the  FASB  issued  SFAS  No.  133,  "Accounting  for  Derivative
Instruments and Hedging  Activities,"  which requires  entities to recognize all
derivatives  in their  financial  statements  as either  assets  or  liabilities
measured at fair value.  SFAS No. 133 also  specifies  new methods of accounting
for hedging  transactions,  prescribes  the items and  transactions  that may be
hedged,  and  specifies  detailed  criteria  to be  met  to  qualify  for  hedge
accounting.

The definition of a derivative  financial instrument is complex, but in general,
it is an instrument  with one or more  underlyings,  such as an interest rate or
foreign exchange rate, that is applied to a notional  amount,  such as an amount
of currency,  to determine the settlement  amount(s).  It generally  requires no
significant initial investment and can be settled net or by delivery of an asset
that is  readily  convertible  to cash.  SFAS No.  133  applies  to  derivatives
embedded in other contracts, unless the underlying of the embedded derivative is
clearly and closely related to the host contract.

SFAS No. 133 is effective  for fiscal years  beginning  after June 15, 1999.  On
adoption, entities are permitted to transfer held-to-maturity debt securities to
the  available-for-sale  or trading category without calling into question their
intent to hold other debt securities to maturity in the future.  SFAS No. 133 is
not  expected  to  have  a  material  impact  on  the  Corporation's   financial
statements.

4.  Earnings Per Share

Basic  earnings  per share is computed  based upon the  weighted-average  shares
outstanding during the period,  less shares in the ESOP that are unallocated and
not committed to be released.  Weighted-average common shares outstanding, which
gives effect to 83,124 and 95,220  unallocated ESOP shares at September 30, 1998
and 1997,  respectively,  totaled  1,107,261  and  1,095,090  for the nine month
periods ended September 30, 1998 and 1997, respectively. Weighted-average shares
outstanding  totaled  1,107,527  and 1,095,090 for the three month periods ended
September 30, 1998 and 1997, respectively.

                                       10



<PAGE>


                              River Valley Bancorp

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     For the nine and three month periods ended September 30, 1998 and 1997

4.  Earnings Per Share (continued)

Diluted earnings per share is computed taking into  consideration  common shares
outstanding  and  dilutive  potential  common  shares  to be  issued  under  the
Corporation's   stock  option  plan.   Weighted-average   common  shares  deemed
outstanding  for  purposes  of  computing  diluted  earnings  per share  totaled
1,126,345 and 1,101,428 for the nine month periods ended  September 30, 1998 and
1997,  respectively.  Weighted-average  common  shares  deemed  outstanding  for
purposes of computing diluted earnings per share totaled 1,113,865 and 1,101,428
for the three month periods ended September 30, 1998 and 1997, respectively.

5.  Reclassifications

Certain  reclassifications  have  been made to the 1997  consolidated  financial
statements to conform to the September 30, 1998 presentation.

































                                       11



<PAGE>


                              River Valley Bancorp

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

     For the nine and three month periods ended September 30, 1998 and 1997


Forward-Looking Statements

In addition to historical information contained herein, the following discussion
contains  forward-looking  statements  that  involve  risks  and  uncertainties.
Economic  circumstances,  the  Corporation's  operations  and the  Corporation's
actual  results  could  differ   significantly   from  those  discussed  in  the
forward-looking  statements.  Some of the factors that could cause or contribute
to such differences are discussed herein but also include changes in the economy
and interest rates in the nation and the Corporation's market area generally.

Some of the  forward-looking  statements  included  herein  are  the  statements
regarding management's determination of the amount and adequacy of the allowance
for  losses on loans,  the  effect  of the year 2000 on  information  technology
systems and the effect of certain recent accounting pronouncements.


Discussion of Financial Condition Changes from December 31, 1997 to
September 30, 1998

At  September  30, 1998,  River  Valley's  consolidated  assets  totaled  $136.3
million,  a decrease of  $734,000,  or .5%,  from the December 31, 1997 total of
$137.0 million. The decrease in assets resulted primarily from a decrease in the
deposit portfolio of $3.8 million,  which was partially offset by an increase in
advances from the Federal Home Loan Bank of $3.0 million.

Liquid assets (i.e.,  cash,  federal funds sold,  interest-earning  deposits and
certificates of deposit) increased by $535,000 from December 31, 1997 levels, to
a total of $6.3 million at September 30, 1998.  Mortgage-backed  and  investment
securities  decreased by $5.1 million,  or 38.3%,  to a total of $8.2 million at
September 30, 1998,  primarily due to maturities of  investments of $2.5 million
and principal repayments on mortgage-backed and related securities totaling $2.6
million.

Loans  receivable,  including  loans held for sale,  totaled  $115.5  million at
September  30,  1998,  an increase  of $3.5  million,  or 3.1%,  from the $112.0
million total at December 31, 1997.  The increase  resulted  primarily from loan
originations during the period of $43.4 million,  which were partially offset by
principal  repayments  of  $28.6  million  and  sales  of  $11.0  million.  Loan
origination volume during the current period exceeded that of the 1997 period by
$9.0 million, or 26.2%.

The Corporation's consolidated allowance for loan losses totaled $1.3 million at
September 30, 1998 and $1.2 million at December 31, 1997, which represented 1.0%
of total loans at those dates.  Nonperforming loans (defined as loans delinquent
greater than 90 days and loans on  nonaccrual  status)  totaled $1.3 million and
$718,000 at September  30, 1998 and December  31, 1997,  respectively.  Although
management  believes  that its  allowance for loan losses at September 30, 1998,
was adequate based upon the available facts and  circumstances,  there can be no
assurance  that  additions  to such  allowance  will not be  necessary in future
periods, which could negatively affect the Corporation's results of operations.


                                       12


<PAGE>


                              River Valley Bancorp

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

     For the nine and three month periods ended September 30, 1998 and 1997


Discussion  of Financial  Condition  Changes from December 31, 1997 to September
30, 1998 (continued)

Deposits  decreased  by $3.8  million,  or 3.3%,  to a total of $111.2  million,
compared to the $115.0  million  total at December  31,  1997.  The  decrease is
primarily attributed to increased  competition from other local institutions and
other deposit alternatives.

Advances from the Federal Home Loan Bank increased by $3.0 million,  or 150%, to
a total of $5.0  million at  September  30,  1998,  compared to the $2.0 million
balance outstanding at December 31, 1997. The increase was due to current period
borrowings of $12.2 million,  which were partially  offset by repayments of $9.2
million.
Management deployed the advances primarily to fund loan originations.

Stockholders' equity totaled $18.4 million at September 30, 1998, an increase of
$388,000,  or 2.2%,  over the $18.0  million  total at December  31,  1997.  The
increase  resulted  primarily  from  current  period  earnings of $973,000 and a
$17,000 decrease in unrealized losses on securities  designated as available for
sale, which were partially offset by purchases of shares for stock benefit plans
totaling  $429,000,  coupled  with the  declaration  and  payment  of  dividends
totaling $191,000.

The Bank is required to maintain minimum  regulatory capital pursuant to federal
regulations.  At September 30, 1998, the Bank's regulatory  capital exceeded all
applicable regulatory capital requirements.


Comparison of Results of Operations for the Nine Months Ended September 30, 1998
and 1997

General

River  Valley's  net  earnings  for the nine months  ended  September  30, 1998,
totaled  $973,000,  a  decrease  of $7,000,  or .7%,  from the  $980,000  of net
earnings reported in the comparable 1997 period. The decrease in earnings in the
1998 period is primarily  attributable to a non-recurring gain on sale of office
premises and equipment of $202,000  recorded in the 1997 period,  coupled with a
decrease in net interest  income of $82,000,  which were  partially  offset by a
$23,000  decrease in the provision for losses on loans,  an increase of $129,000
in the gain on sale of loans,  a decrease of $10,000 in general,  administrative
and other expense and a $19,000 decrease in the provision for income taxes.

Net Interest Income

Total interest income for the nine months ended September 30, 1998,  amounted to
$7.7 million,  a decrease of $187,000,  or 2.4%,  from the comparable  period in
1997,  reflecting  the  effects of decline  in average  interest-earning  assets
outstanding,  partially  offset by an increase  in yield year to year.  Interest
income on loans and  mortgage-backed  securities totaled $7.4 million at each of
the  nine  month   periods   ended   September   30,  1998  and  1997,   as  the
weighted-average  balances  declined by  approximately  $1.7 million,  while the
yields  increased  by  nine  basis  points  year to  year.  Interest  income  on
investments and interest-earning  deposits decreased by $169,000,  or 35.1%, due
to a decrease in the average balance  outstanding of approximately  $3.3 million
and an approximate  23 basis point  decrease in yield from the  comparable  1997
period.

                                       13


<PAGE>


                              River Valley Bancorp

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

     For the nine and three month periods ended September 30, 1998 and 1997


Comparison of Results of Operations for the Nine Months Ended September 30, 1998
and 1997 (continued)

Net Interest Income (continued)

Interest expense on deposits decreased by $149,000,  or 4.1%, to a total of $3.5
million for the nine  months  ended  September  30,  1998,  due  primarily  to a
decrease in the average balance of deposits  outstanding of  approximately  $6.5
million,  which was partially offset by an increase in the weighted-average cost
of  deposits  of  approximately  six basis  points,  to 4.15% in 1998.  Interest
expense on borrowings  totaled  $137,000 for the nine months ended September 30,
1998, an increase of $44,000 over the  comparable  period in 1997.  The increase
resulted  primarily from an increase in average  borrowings  outstanding year to
year, coupled with an increase in average cost.

As a result of the foregoing  changes in interest  income and interest  expense,
net interest  income  decreased by $82,000,  or 2.0%,  for the nine months ended
September 30, 1998, compared to the comparable period in 1997. The interest rate
spread  increased by  approximately  four basis points for the nine months ended
September  30,  1998,  to 3.85%  from  3.81% in the 1997  period,  while the net
interest margin amounted to approximately 4.24% in 1998 and 4.16% in 1997.

Provision for Losses on Loans

A  provision  for  losses on loans is  charged  to  earnings  to bring the total
allowance for loan losses to a level considered  appropriate by management based
upon  historical  experience,  the volume and type of lending  conducted  by the
Bank, the status of past due principal and interest  payments,  general economic
conditions,  particularly as such  conditions  relate to the Bank's market area,
and other factors related to the collectibility of the Bank's loan portfolio. As
a result of such analysis,  management  recorded a $215,000 provision for losses
on loans for the nine months ended September 30, 1998,  compared to the $238,000
amount recorded in the 1997 period. While management believes that the allowance
for losses on loans is adequate at September 30, 1998,  based upon the available
facts and circumstances,  there can be no assurance that the loan loss allowance
will be adequate to cover losses on nonperforming assets in the future.

Other Income

Other income increased by $23,000,  or 2.6%, for the nine months ended September
30, 1998,  as compared to the same period in 1997,  due  primarily to a $129,000
increase in gain on sale of loans, a $45,000 increase in service fees,  charges,
and other operating  income and an increase of $57,000 in gain on sale of office
premises,  which  were  partially  offset by a  $202,000  gain on sale of office
premises and equipment recorded during the nine months ended September 30, 1997,
coupled with a $10,000 decrease in insurance commissions.  The 1997 gain on sale
of  office  premises  resulted  from  River  Valley's  sale of a  branch  office
facility,  located in Hanover,  Indiana,  which was  consummated on February 28,
1997, as required in accordance  with the terms of regulatory  approval of River
Valley's  acquisition  of  Citizens  National  Bank of  Madison.  The decline in
insurance  commissions resulted from River Valley's sale of its insurance agency
subsidiary.


                                       14


<PAGE>


                              River Valley Bancorp

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

     For the nine and three month periods ended September 30, 1998 and 1997


Comparison of Results of Operations for the Nine Months Ended September 30, 1998
and 1997 (continued)

General, Administrative and Other Expense

General,  administrative and other expense decreased by $10,000,  or .3%, during
the nine months ended  September 30, 1998,  compared to the same period in 1997.
This decrease  resulted  primarily from a $103,000,  or 54.5%,  decrease in data
processing expense and a $36,000,  or 4.2%, decrease in other operating expense,
which  were  partially  offset by a  $152,000,  or 9.1%,  increase  in  employee
compensation and benefits.  The decreases in data processing and other operating
expenses  generally reflect economies  resulting from the merger of River Valley
Financial  Bank and  Citizens  National  Bank of Madison in November  1997.  The
increase in employee compensation and benefits was due primarily to normal merit
increases and increased costs associated with stock benefit plans.

Income Taxes

The  provision  for income  taxes  decreased by $19,000,  or 2.9%,  for the nine
months ended  September 30, 1998,  as compared to the same period in 1997.  This
decrease  resulted  primarily  from a decrease in net  earnings  before taxes of
$26,000,  or 1.6%.  The  effective  tax rates  were 39.7% and 40.2% for the nine
months ended September 30, 1998 and 1997, respectively.


Comparison of Results of Operations for the Three Months Ended September 30,
1998 and 1997

General

River  Valley's net earnings  for the three  months  ended  September  30, 1998,
totaled  $339,000,  an increase of $24,000,  or 7.6%,  over the  $315,000 of net
earnings reported in the comparable 1997 period. The increase in earnings in the
1998 period is primarily  attributable  to an increase in net interest income of
$1,000 and an increase in other income of $109,000,  which were partially offset
by an increase in general,  administrative and other expense of $53,000,  and an
increase in the provision for income taxes of $36,000.

Net Interest Income

Total interest  income for the three months ended September 30, 1998 amounted to
$2.6  million,  a decrease of $21,000,  or .8%, from the  comparable  quarter in
1997,  reflecting  the effects of a decline in average  interest-earning  assets
outstanding, coupled with a decrease in the yield year-to-year.  Interest income
on loans and  mortgage-backed  securities  totaled  $2.6  million  for the three
months ended  September  30,  1998,  an increase of $28,000,  or 1.1%,  over the
comparable 1997 quarter. The increase resulted primarily from a $1.2 million, or
1.0%, increase in the average balance outstanding year-to-year.  Interest income
on investments and interest-earning deposits decreased by $49,000, or 38.0%, due
to a decrease in the average balance outstanding of $2.4 million.


                                       15


<PAGE>


                              River Valley Bancorp

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

     For the nine and three month periods ended September 30, 1998 and 1997


Comparison of Results of Operations for the Three Months Ended September 30,
1998 and 1997 (continued)

Net Interest Income (continued)

Interest expense on deposits  decreased by $44,000,  or 3.7%, to a total of $1.2
million  for  the  quarter  ended  September  30,  1998,  due  primarily  to  an
approximate   $5.0  million   decrease  in  the  average   balance  of  deposits
outstanding. Interest expense on borrowings totaled $81,000 for the three months
ended September 30, 1998, an increase of $22,000,  or 37.3%, from the comparable
quarter in 1997.  The increase  resulted  primarily  from an increase in average
borrowings outstanding year to year.

As a result of the foregoing  changes in interest  income and interest  expense,
net  interest  income  increased  by $1,000,  or .1%, for the three months ended
September 30, 1998, as compared to the comparable  quarter in 1997. The interest
rate spread amounted to  approximately  3.97% for the 1998 quarter,  compared to
3.87% in 1997, while the net interest margin totaled  approximately 4.37% in the
1998 quarter, compared to 4.24% in 1997.

Provision for Losses on Loans

A  provision  for  losses on loans is  charged  to  earnings  to bring the total
allowance for loan losses to a level considered  appropriate by management based
upon  historical  experience,  the volume and type of lending  conducted  by the
Bank, the status of past due principal and interest  payments,  general economic
conditions,  particularly as such  conditions  relate to the Bank's market area,
and other factors related to the collectibility of the Bank's loan portfolio. As
a result of such analysis, management recorded a $65,000 provision for losses on
loans for the three months  ended  September  30, 1998,  compared to the $68,000
amount recorded in the 1997 period. While management believes that the allowance
for losses on loans is adequate at September 30, 1998,  based upon the available
facts and circumstances,  there can be no assurance that the loan loss allowance
will be adequate to cover losses on nonperforming assets in the future.

Other Income

Other  income  increased  by  $109,000,  or 44.3%,  for the three  months  ended
September 30, 1998,  as compared to the same period in 1997,  due primarily to a
$57,000 gain on sale of office  premises,  a $31,000  increase in service  fees,
charges, and other operating income, coupled with increase of $16,000 in gain on
sale of loans.

General, Administrative and Other Expense

General,  administrative and other expense increased by $53,000, or 5.0%, during
the three months ended September 30, 1998,  compared to the same period in 1997.
This increase resulted primarily from a $66,000, or 11.4%,  increase in employee
compensation  and benefits and a $15,000,  or 5.3%,  increase in other operating
expense,  which were partially offset by a $26,000,  or 46.4%,  decrease in data
processing expense.


                                       16


<PAGE>


                              River Valley Bancorp

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

     For the nine and three month periods ended September 30, 1998 and 1997


Comparison of Results of Operations for the Three Months Ended September 30,
1998 and 1997 (continued)

Income Taxes

The provision  for income taxes  increased by $36,000,  or 18.7%,  for the three
months ended  September 30, 1998,  as compared to the same period in 1997.  This
increase  resulted  primarily  from an increase in net earnings  before taxes of
$60,000,  or 11.8%.  The effective tax rates amounted to 40.3% and 38.0% for the
three months ended September 30, 1998 and 1997, respectively.


Year 2000 Compliance Matters

As with all providers of financial  services,  the Bank's operations are heavily
dependent  on  information  technology  systems.  The  Bank  is  addressing  the
potential  problems  associated  with the  possibility  that the computers  that
control or operate the Bank's  information  technology system and infrastructure
may not be  programmed  to read  four-digit  date codes and, upon arrival of the
year 2000,  may  recognize  the  two-digit  code "00" as the year 1900,  causing
systems to fail to function or to generate  erroneous  data. The Bank is working
with the companies that supply or service its information  technology systems to
identify and remedy any year 2000 related problems.

The Bank's core data processing  relative to customer loan and deposit accounts,
as well as the general ledger, is performed  in-house through use of a purchased
software  product.  Management  has been advised,  and certain  testing has been
performed to verify,  that the system will  continue to function upon arrival of
the year 2000.

As of the date of this Form 10-QSB,  the Bank has  identified  certain  expenses
that will be incurred by the Bank in connection  with this issue.  Such expenses
total approximately  $15,000. The Bank has established a budget of approximately
$65,000 for year 2000 related  costs.  From a review of the systems and vendors,
management  believes the budgeted amount should be sufficient.  No assurance can
be given,  however,  that  significant  expense  will not be  incurred in future
periods.  In the  event  that  the  Bank  is  ultimately  required  to  purchase
replacement  computer  systems,  programs and  equipment,  or incur  substantial
expense to make the Bank's  current  systems,  programs and equipment  year 2000
compliant,  the Bank's net earnings and financial  condition  could be adversely
affected.








                                       17



<PAGE>


                              River Valley Bancorp

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

     For the nine and three month periods ended September 30, 1998 and 1997


Year 2000 Compliance Matters (continued)

In the event  that the Bank is unable to  process  transactions  as normal  upon
arrival of the year 2000, the Bank has access to a third-party  contingency site
with its software  vendor.  Additionally,  the Bank could  conduct  transactions
manually for a period of time, if necessary.

In addition to possible expense related to its own systems, the Bank could incur
losses if loan  payments  are delayed due to year 2000  problems  affecting  any
major  borrowers in the Bank's primary  market area. The Bank has contacted,  in
person or by mail,  most of its larger loan  customers to make them aware of the
year 2000 issues.  A brochure has also been distributed to customers by mail and
in person.  Because the Bank's loan portfolio is highly  diversified with regard
to individual  borrowers and types of businesses  and the Bank's  primary market
area is not significantly dependent upon one employer or industry, the Bank does
not  expect any  significant  or  prolonged  difficulties  that will  affect net
earnings or cash flow.































                                       18


<PAGE>


                              River Valley Bancorp

                                     PART II

ITEM 1.  Legal Proceedings

          Not applicable.

ITEM 2.  Changes in Securities and Use of Proceeds

          None.

ITEM 3.  Defaults Upon Senior Securities

          Not applicable.

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

          Reports on Form 8-K:        On  September 3, 1998,  the  Corporation
                                      filed a Form 8-K disclosing its
                                      intention to repurchase up to 5%, or 
                                      59,512 shares, of its  stock  on the  
                                      open market.

          Exhibit 27.1:               Financial Data Schedule for the nine 
                                      month period ended September 30, 1998

          Exhibit 27.2:               Restated Financial Data Schedule for the
                                      nine month period ended September 30, 1997

















                                       19



<PAGE>




                                   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.





Date:   November 12, 1998                     By: /s/James E. Fritz    
     ---------------------------------           -----------------------------
                                                  James E. Fritz
                                                  CEO/President



Date:   November 12, 1998                     By: /s/Larry C. Fouse            
     ---------------------------------            -----------------------------
                                                  Larry C. Fouse
                                                  Chief Financial Officer





































                                       20