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

Form 10-KSB




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

For the Fiscal Year Ended September 30, 1999

[ ]
Transition Report Under Section 13 or 15(d) of The Securities Exchange Act of
1934 for the transition period from _____________ to ____________


Commission File Number 33-37809-NY

Castle Holding Corp.
(Name of Small Business Issuer in its Charter)

Nevada
(State or Other Jurisdiction of Incorporation)
77-0121957
(I.R.S. Employer Identification No.)

45 Church Street, Suite 25, Freeport, NY
(Address of Principal Executive Offices)
11520 (Zip Code)

Issuer's Telephone Number: (516)868-2000

Securities Registered under Section 12(b) of the Exchange Act: None

Securities Registered under Section 12(g) of the Exchange Act: Common Stock, Par
Value $.0025 per Share.

Check whether the issuer (1) filed all reports required to be filed by section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. [ ] Yes [X] No
Check if there is no disclosure of delinquent filers in response to item 405
of  Regulation S-B contained herein, and no disclosure will be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in part iii of this form 10-KSB or any amendment to
this form 10-KSB. [X ]
The  issuer's revenues for its most recent fiscal year was  $3,309,663
As of November 30, 1999, the aggregate market value of the registrant's common
stock (based on its $.25 reported
last bid price on the OTC Bulletin Board)  held by non-affiliates of the
registrant was $ 679,000.
As of November 30, 1999, there were 6,660,500 common shares outstanding.



<PAGE>1


PART I

Item 1. DESCRIPTION OF BUSINESS


Castle Holding Corp. (The "Company" or the "Registrant") is a holding Company
incorporated in Nevada on June 13, 1986.  The Company conducts substantially all
of its business through two subsidiaries, Castle Securities Corp.
("Castle" or "CSC-1") and Citadel Securities Corp. ("Citadel" or "CSC-2").
Castle was incorporated in New York on December 7, 1984 and operates as a
broker-dealer in securities.  Its business activities include the underwriting
and brokerage of fixed income and equity securities.   Citadel was incorporated
in New York on April 11, 1991 and also operates as a broker-dealer in
securities.   Citadel makes markets in Nasdaq, OTC Bulletin Board and "Pink
Sheets" securities, has no retail customers, and conducts business
exclusively with other broker-dealers.

Castle and Citadel are broker-dealers registered with the Securities and
Exchange Commission ("SEC") and members of the National Association of
Securities Dealers ("NASD"), the Municipal Securities Rule Making Board
("MSRB"), and the Securities Investor Protection Corporation ("SIPC").
Castle is currently licensed to conduct its broker-dealer business in 36
states and the District of Columbia.   Citadel is currently licensed to conduct
its broker-dealer business only in New York.

On December 28, 1998, the Company paid a 100% stock dividend and on June 25,
1999, the Company paid a 300% stock dividend.  All references to shares and
per share amounts herein have been restated to retroactively reflect these
stock dividends.


<PAGE>2

Revenues By Source



For the years ended September 30, 1999 and 1998, revenues were derived as
follows:

<TABLE>

                                   								Years Ended September 30,

<S>   			                                   1999          1998
Commissions:                          <C>           <C>
     Castle Online       						       $2,484,152	   $1,017,136
     Active Account Program					         348,349	      541,840
     Other stocks and bonds						         94,285	       86,941
     Mutual funds							                  16,566	       13,527

     Total commissions						           2,943,352	    1,659,444

Principal Transactions:
     Trading accounts						              358,933	      257,701
     Investment accounts						               280	      (21,931)

    Total principal transactions			      359,213       235,770

Interest and dividends						               7,098         4,485

Total revenues							                 $3,309,663	   $1,899,699
</TABLE>

Castle Online

Castle Online ("Online") is a division of Castle started in July 1996 to allow
customers to engage in securities transactions directly over the Internet.
In April 1997, Online installed a T-1 fiber optics data feed expandable into a
T-3 data feed.  To date, only securities listed on the New York Stock Exchange,
the American Stock Exchange and the Nasdaq Stock Market have been available to
Online customers.

Castle maintains a web site (www.castleonline.com) where parties interested in
online trading can both learn about the various features of this service and can
register for trading.  This system offers customers the ability to execute
day trades (the practice of buying and selling securities, usually exiting
the position in the same day) using the Company's JavaTrader order entry
software.

With respect to the Nasdaq Stock Market (over 95% of Online transactions involve
securities listed there), the system offers five routing selections for
customers to transact their buying and selling.  The first is SOES, an
automated  execution method that allows an investor to buy at the offer and sell
at the bid.  The second is Selectnet, whereby an investor can submit an order
within the spread for only Market Makers to view and possibly execute.
The newest option provided is routing orders to Knight Securities for
automated execution.   This selection accepts the following types of orders:
market, limit, stop limit, and stop loss.  Lastly, we offer two Electronic
Communications Networks ("ECN") to choose from:  Island ("ISLD") and Nextrade
("NTRD").  By submitting an order on an ECN, an investor "posts" the order to
buy or sell a security on the Nasdaq Level 2 screen, so that the entire market
can see it and execute on it.  The ISLD or NTRD symbol, which displays the
customer order  like a Market Maker, will move to the price designated by an
investor's order.

Online software offers customers the ability to place unsolicited market and
limit orders and view executions without the necessity of telephone calls to
Castle registered representatives. For $150 per month ($0 if customer monthly
transactions exceed 100), customers are provided real time Nasdaq level II
quotes and other quotes, news and charts.  Commissions start at $19.95 per
trade.

<PAGE>3

For the years ended September 30, 1997, 1998 and 1999, Online customer
transactions totaled 18,986, 57,610, and 149,107, respectively.  At September
30, 1997, September 30, 1998 and September 30, 1999, Online had funded
customer accounts numbering 90, 168, and 360, respectively.

Registrant expects Online to become its primary source of future growth,
revenues and profitability.

Principal  Transactions

In April 1994, Castle resumed market-making activities in over-the-counter
equity securities (Castle had ceased such activities on August 24, 1992).
In April 1996, such activities were transferred to Citadel. At September 30,
1999, Citadel employs two traders making markets in a total of 55 securities, 3
quoted on the Nasdaq Stock Market, 43 quoted on the OTC Bulletin Board, and 9
quoted on the "Pink Sheets."

Trading profits or losses are dependent upon the skill of the firm's employees
in market-making activities, the capital allocated to the firm's positions in
various securities and the general trend of prices and level of activity in the
securities markets. Trading as principal requires the commitment of capital and
creates an opportunity for profits and losses due to market fluctuations.
Citadel takes both long and short positions in those securities in which it
makes a market.

Under its present restriction agreement with the NASD, Citadel is limited to
making markets in 100 securities.

Active Account Program

The Active Account Program ("AAP") is a division of Castle started in December
1992 to afford active customers quick executions using automated order entry
systems (such as SOES, SelectNet and the ISLD ECN) at relatively low
commission rates.  Most AAP customers opened margin accounts and gave trading
authorization to a Castle registered representative.

For the years ended September 30, 1997, 1998, and 1999, AAP customer
transactions totaled 184,654, 33,041, and 23,865, respectively.
At September 30, 1999, the AAP has only one remaining registered representative
day trading a discretionary account on a full time basis.


Investment Banking

Since inception, Castle has been the managing underwriter of completed
"best efforts" public offerings of equity securities for 23 issuers
(the last one was completed in 1991). Additionally, Castle has participated in
other equities and municipal bond offerings as a selected dealer or selling
group member.

In May 1999, Castle executed a letter of intent to act as managing underwriter
of a "best efforts" public offering of equity securities of Exhaust
Technologies, Inc.  The related registration statement has not been filed as of
September 30, 1999 and accordingly the offering is not expected to commence
until the year 2000.

Castle is currently revising its website (www.castlesecurities.com) to display
prospectuses and offer new issues  over the Internet.

As an underwriter, Castle is subject to liability under the Securities Act of
1933, as amended, state and other laws in the event, among other matters, that
the registration statement or prospectus contains a material misstatement or
omission. Castle's potential liability as an underwriter is not generally
covered by insurance.
<PAGE>4
Investment Management

On December 23, 1993, Castle Advisers Inc. ("CAI") was formed to operate as a
general partner for limited partnerships in the business of securities
investment. On March 29, 1994, CAI executed a limited partnership agreement
with Castle Advisors Limited Partnership 94-1 ("CALP") to operate as its general
partner. Under the agreement, CAI receives a performance incentive allocation
equal to 1% of the profits (which exceed cumulative losses previously
allocated to limited partners).

At  September  30, 1999,  CALP  had  net assets of approximately $134,955,
including its $120,000 investment in the Company.   Since inception, CAI has
earned $525 in performance incentive fees.


<PAGE>5

Clearing Broker

In executing customers' orders to buy or sell listed securities and other
securities in which it does not make a market, Castle generally acts as an agent
and charges a commission.

Castle and Citadel have clearing agreements with JB Oxford & Company. The
clearing broker clears transactions on a fully disclosed basis for Citadel
and for Castle's account and the accounts of its customers. The services
provided by the clearing broker include billing and receipt, and custody and
delivery of securities, for which Castle and Citadel pays the clearing broker
certain transaction fees and miscellaneous charges.

Competition

The Company, through Castle and Citadel, both registered broker/dealers and
members of the NASD, is engaged in a highly competitive business. Its principal
competition includes, with respect to one or more aspects of its business,
all of the member organizations of the New York Stock Exchange ("NYSE") and
other registered securities exchanges, all members of the NASD, and commercial
banks and thrift institutions. Many of these organizations are national firms
and have substantially greater financial and human resources than Castle or
Citadel.

Discount brokerage firms seeking to expand their share of the retail market,
including firms affiliated with commercial banks and thrift institutions, are
devoting substantial funds to advertising and direct solicitation of
customers. In many instances, Castle and Citadel are competing directly with
such organizations. In addition, there is competition for investment funds
from the real estate, insurance, banking and savings and loan industries.
The Company believes that the principal factors affecting competition for the
securities industry are the quality and ability of professional personnel and
relative prices of services and products offered.

Regulation

The securities industry in the United States is subject to extensive regulation
under federal and state laws. The SEC is the federal agency charged with
administration of the federal securities laws. Much of the regulation of
broker-dealers, however, has been delegated to self-regulatory organizations,
principally the NASD and the national securities exchanges, although the SEC
maintains jurisdiction and is not necessarily bound by the actions or
recommendations of the NASD. These self-regulatory organizations adopt rules
(which are subject to approval by the SEC) that govern the industry and conduct
periodic examinations of member broker-dealers. Securities firms are also
subject to regulation by state securities commissions in the states in which
they are registered.

The regulations to which broker-dealers are subject cover all aspects of the
securities business, including sales methods, trade practices among
broker-dealers, capital structure of securities firms, record-keeping and
conduct of directors, officers and employees. Additional legislation, changes
in rules promulgated by the SEC and self-regulatory organizations, or changes
in the interpretation or enforcement of existing laws and rules often directly
affect the method of operation and profitability of broker-dealers. The SEC,
self-regulatory organizations and state security regulators may conduct
administrative proceedings, which can result in censure, fine, suspension
or expulsion of a broker-dealer, its officers or employees. The principal
purpose of regulation and discipline of broker-dealers is the protection of
customers and the securities markets rather than protection of creditors and
stockholders of broker-dealers.

<PAGE>6

Net Capital Requirements

As broker-dealers, Castle and Citadel are subject to the SEC's Net Capital Rule
(the "Rule") which is designed to measure the general financial integrity and
liquidity of a broker-dealer. The Rule requires the maintenance of minimum
net capital (at September 30, 1999, $8,944 for Castle and $100,000 for Citadel)
and requires that the ratio of aggregate indebtedness, as defined, to net
capital, not exceed 15 to 1. In computing net capital, various adjustments to
net worth are made with a view to excluding assets that are not readily
convertible into cash and making a conservative statement of other assets, such
as a firm's position in securities. Compliance with the rule limits those
operations of securities firms that require the intensive use of their capital,
such as underwriting commitments and principal trading activities, and limits
the ability of securities firms to pay dividends.

Both Castle and Citadel are required to file "Focus" reports with the NASD. The
purpose of these reports is to provide the NASD with a current financial status
for each Company and to evidence compliance with the net capital requirements.

In addition to the above requirements, funds invested as equity capital may not
be withdrawn, nor may any unsecured advances or loans be made to any
stockholder of a registered broker-dealer, if, after giving effect to such
withdrawal, advance or loan and to any other such withdrawal, advance or loan
as well as to any scheduled payments of subordinated debt which are scheduled
tooccur within six months, the net capital of the broker-dealer would fail to
equal 120% of the minimum dollar amount of net capital required or the ratio of
aggregate indebtedness to net capital would exceed 10 to 1. Finally, any funds
invested in the form of subordinated debt generally must be invested for a
minimum term of one year and repayment of such debt may be suspended if the
broker-dealer fails to maintain certain minimum net capital levels. For
example, scheduled payments of subordinated debt are suspended in the event
that the ratio of aggregate indebtedness to net capital of the broker-dealer
would exceed 12 to 1 or if its net capital would be less than 120% of the
minimum dollar amount of net capital required.

At September 30, 1999, Castle had net capital of $88,496, which was $79,552 in
excess of its required net capital, and its ratio of aggregate indebtedness to
net capital was 1.52 to 1. Citadel had net capital of $213,582, which was
$113,582 in excess of its required net capital, and its ratio of aggregate
indebtedness to net capital was .08 to 1.

Employees

At September 30, 1999, the Company employed a total of 48 persons, including 2
executive personnel, 33 other registered representatives (17 part-time), and 13
other full-time administrative persons.

Registered representatives are required to take examinations given by the NASD
and approved by the NYSE and all principal exchanges as well as state
securities authorities in order to be registered. There is intense competition
among securities firms for registered representatives with proven sales
production records.

The Company considers its employee relations to be good and believes that its
compensation and employee benefits are competitive with those offered by
other securities firms. None of the Company's employees are covered by a
collective bargaining agreement.


Item 2. DESCRIPTION OF PROPERTY

The Company, Castle, and Citadel maintain their business headquarters at 45
Church Street, Freeport, New York 11520, where they occupy approximately
16,000 square feet of office space. The facilities are occupied under six
lease agreements that provide for total monthly rentals of $6,417 and
expire October, 2002. At the option of a wholly owned subsidiary of the
Company, the leases are renewable for periods extending the terms to
October 2007.  The facilities provide the Company with sufficient space in
which to conduct its present activities and store required business records
pursuant to rules and regulations of the SEC and the NASD.
<PAGE>7
Item 3. LEGAL PROCEEDINGS

Since inception Castle and certain of its principals have been the targets of
various legal and administrative proceedings brought by the SEC, the NASD or
other state securities commissions.  Additionally, in the normal course of
its business, Castle, from time to time, is involved in claims, lawsuits and
arbitrations brought by its customers.

Material legal proceedings outstanding at September 30. 1999 follows:

 (1)	SEC V. U.S. Environmental, Inc., Castle, Michael T. Studer et. al.

On September 13, 1994, the SEC filed a civil action against Castle, its
president, a former registered representative, and eight other defendants.
The action alleges violations of Section 5(a) and (c), and 17(a) of
the Securities Act of 1933, Section 10(b) and 15c of the Securities Exchange Act
of 1934 and Rules 10b-3, 10b-5, 10b-6, and 15cl-2 thereunder.
The complaint seeks injunctive relief and disgorgement of profits in the
approximate amount of $175,000.  An answer and amended answer has been filed
on behalf of Castle and its president and discovery has commenced but no
trial date has yet been set.

 (2) National Association of Securities Dealers, Inc. Market Surveillance
     Committee V. Castle, Michael T. Studer et. al.

On October 6, 1994, the National Association of Securities Dealers, Inc.
Market Surveillance Committee (the "MSC") commenced a disciplinary proceeding
against Castle, its president, and two former registered representatives.
The complaint alleges violations of Article III, Sections 1, 4, 18, and 27 of
the Association's Rules of Fair Practice and Section 10(b) of the Securities
Exchange Act of 1934 and Rule 10b-5 thereunder.
After a hearing on June 20, 1995, in MSC's Decision dated February 7, 1996,
Castle and its president were fined, jointly and severally, $25,000 and were
ordered to make restitution to specified customers totaling approximately
$10,000. Castle and its president appealed the decision to the National
Business Conduct Committee (the "NBCC") of the NASD and a hearing of the appeal
was held on June 7, 1996. In its Amended Decision dated October 21, 1996, the
NBCC affirmed the fines and restitution order. On November 15, 1996, Castle
and its president appealed the NBCC Amended Decision to the SEC. On January 7,
1998, the SEC affirmed the NBCC Amended Decision. On May 18, 1998, the SEC
denied Castle's Motion for Reconsideration filed January 21, 1998.
On February 5, 1998 and June 15, 1998, Castle and its president filed petitions
for review of the NASD and SEC actions to the Second Circuit of the United
States Court of Appeals, which matters are still pending.


ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to Security holders during the two fiscal years ended
September 30, 1999.
<PAGE>8

Part II
Item 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

The Company's common stock, $.0025 par value, is traded in the over-the-counter
market under the OTC Bulletin Board symbol "CHOD". However, there is no
established trading market as actual transactions are infrequent.  The
following table sets forth the range of high and low closing bid quotations
by calendar quarters as reported by the National Quotation Bureau from
October 1, 1997 through September 30, 1999, as adjusted for the 100% stock
dividend paid December 28, 1998 and the 300% stock dividend paid June
25, 1999.  Bid quotations represent prices between dealers, do not include
retail mark-ups, mark-downs or other fees or commissions, and do not
necessarily represent actual transactions.


Quarter Ended:          High Bid            Low Bid

December 31, 1997          0.031              0.031
March 31, 1998             0.031              0.031
June 30, 1998              0.047              0.031
September 30, 1998         0.063              0.047
December 31, 1998          0.594              0.063
March 31, 1999             1.000              0.281
June 30, 1999              1.750              0.422
September 30, 1999         0.938              0.156



As of September 30, 1999, the number of holders of record of the company's
common stock was 155.  There were ten (10) market makers for the company's
common stock,  6,640,500 shares outstanding and the closing bid price was
$0.1875.

Registrant has paid no cash dividends and has no present plan to pay cash
dividends, intending instead to reinvest its earnings, if any.  However,
payment of future cash dividends will be determined from time to time by its
Board of Directors, based upon its future earnings, financial condition,
capital requirements and other factors.




<PAGE>9

Recent Sales of Unregistered Securities

Equity securities of the Registrant sold by the Registrant during the quarterly
period ended September 30, 1999 that were not registered under the Securities
Act were:


<TABLE>

<S>
	           		     Title of		  Number
Date of Sale		     Security		   Shares 	 Purchases		        Consideration
                   <C>         <C>       <C>                <C>
July 1, 1999		     Common	     1,500		   Three employees    Services valued
			                Stock				             of vendor          at $750

July 15, 1999		    Common	       800		   Two employees		    Services valued
			                Stock							                             at $500

July 15, 1999		    Common	     6,000		   Sandor Marketing	  Prepaid services
			                Stock				             Group Inc.		       valued at $3,750

August 5, 1999		   Common	    12,000		   Mitchell Menik		   Prepaid services
			                Stock							                             valued at $7,500

August 5, 1999		   Common	       800		   Eight employees		  Services  valued
			                Stock							                             at  $800

August 11, 1999		  Common 	   10,000		   Ferdinand Schmid	  $6,250
                   Stock						                              Promissory Notes

September 8, 1999	 Common	     3,000		   Three employees		  $1,875
                   Stock             				                   Promissory Notes
</TABLE>



No underwriting discounts or commissions were paid in connection with any of
the above sales.  For all of the above sales, the registrant claimed
exemption from registration under Section 4(2) of the Securities Act of 1933.
<PAGE>10

Item 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS


Results  of  Operations

General - Substantial positive and negative fluctuations can occur in the
Registrant's business due to a variety of factors, including variations in
the market value of Securities, the volatility and liquidity of trading
markets, and the level of market activity. As a result, net income and
revenues in any particular period may not be representative of full-year
results and may vary significantly from year to year and from quarter to
quarter. In addition, results of operations have been in the past and may
in the future continue to be materially affected by many factors of a
national and international nature, including economic and market conditions,
currency values, inflation, the availability of capital, the level and
volatility of interest rates, the valuation of Securities positions and
nvestments, and legislative and regulatory developments, as well as the
size, number and timing of transactions. The Registrant's results of operations
also may be materially affected by competitive factors and its ability to
attract and retain highly skilled individuals.

Year ended September 30, 1999 compared to year ended September 30, 1998

Net loss for the year ended September 30, 1999 was $(63,865), or $(.01) per
share, compared to a net loss of $(186,718), or $(.04) per share, for the
year ended September 30, 1998. Total revenues increased $1,409,964 (74%) to
$3,309,663 and total expenses increased $1,288,016 (62%). Revenues less
commissions and clearing  and execution costs were $2,044,817 in 1999
compared to $1,403,171 in 1998.  In 1998, clearing and execution costs were
reduced by $266,162 received from CSC-1's clearing agent in settlement of prior
fee disputes.

The increase in total revenues was due to  $1,467,016 higher commissions
derived from Castle Online.  Castle Online customer transactions increased from
57,610 in 1998 to 149, 107 in 1999.  Castle Online funded customers increased
from 90 at September 30, 1997 to 168 at September 30, 1998 to  360 at September
30, 1999.

Commissions expense as a percentage of total revenues  was 14% and 13% in 1999
and 1998, respectively.

Excluding the $266,162 settlement in 1998 noted above (which reduced 1998
clearing  and execution costs), clearing  and execution costs as a percentage
of total revenues was 24% and  27% in 1999 and 1998, respectively.

Communications expense increased $123,965 from $179,728 in 1998 to $303,693 in
1999. This increase was due to higher NASDAQ network charges and the addition
of a second internet service in 1999.

Administrative compensation and employee benefits increased $166,121 (28%) and
professional and consulting fees increased $112,773.  These increases were due
primarily  to the addition of personnel and consultants for software
development, marketing, and service support of Castle Online

Liquidity and Capital Resources

The majority of the Registrant's assets are highly liquid and short-term in
nature. Cash, due from brokers, and securities owned at September 30, 1999
totaled $556,208, 68% of the Registrant's assets.

Cash and cash equivalents increased $195,867  from $187,266 at September 30,
1998 to $383,133 at September 30, 1999. This increase was due primarily to
sales of common shares with net proceeds totaling $227,500.

Castle and Citadel, the Registrant's broker-dealer subsidiaries, are subject to
"net capital" requirements of the SEC. Among other things, these requirements
limit the number of markets which they may make and the value of  securities
inventories which they may carry. Presently, a broker or dealer engaged in
activities as a market maker must maintain net capital in an amount not less
than $2,500 for each security in which it makes a market (unless a  security in
which it makes a market has a market value of $5.00 or less in which event the
amount of net capital shall be not less than $1,000 for each such security).

At September 30, 1999, Castle had net capital of $88,496, which was $79,552 in
excess of its required net capital of $8,944, and Citadel had net capital of
$213,582, which was $113,582 in excess of its required net capital of $100,000.






<PAGE>11

Item 7.  FINANCIAL STATEMENTS

Index to Consolidated Financial Statements



Description	                                                         Page No.

Index to Consolidated Financial Statements                              12

Independent Auditors' Report							                                     13

Consolidated Statements of Financial Condition,
September 30, 1999 and 1998							                                      14

Consolidated Statements of Operations,
Years ended September 30, 1999 and 1998						                           15

Consolidated Statements of Changes in Stockholders' Equity,
Years ended September 30, 1999 and 1998				                           		16-17

Consolidated Statements of Cash Flows,
Years ended September 30, 1999 and 1998	                             			18-19

Notes to Consolidated Financial Statements,
Years ended September 30, 1999 and 1998	                            				20-29



<PAGE>12

	INDEPENDENT AUDITORS' REPORT




To the Board of Directors and Stockholders of
Castle Holding Corp.

We have audited the accompanying consolidated statement of financial condition
of Castle Holding Corp.  and Subsidiaries ("the Company") as of September 30,
1999 and 1998 and the related consolidated statements of operations, changes in
stockholder's equity, and cash flows for the year then ended. These
consolidated financial statements are the responsibility of the Company's
management.  Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the consolidated financial statements
are free of material misstatement.  An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the consolidated
financial statements.  An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall consolidated financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of the Company as of
September 30, 1999 and 1998 and the results of its consolidated operations and
cash flows for the year then ended in conformity with generally accepted
accounting principles.





Massella, Tomaro & Co., LLP
Jericho, New York
December 23, 1999

<PAGE>13

CASTLE HOLDING CORP. AND SUBSIDIARIES
Consolidated Statements of Financial Condition

<TABLE>
								                                                      September 30,
<S>                   							                                1999       1998
Assets                                                <C>          <C>
Cash and cash equivalents	      		                   	$   383,133  $ 187,266
Due from brokers					    	    		                          137,455     65,977
Securities owned, at market value			                       35,620    	26,121
Equipment, less accumulated depreciation
    of $164,151 and $143,838, respectively	                31,667     56,014
Equipment under capital leases, less accumulated
    depreciation of $89,090 and $65,241, respectively      66,482     30,468
leasehold improvements, less accumulated
    amortization of $77,296 and $50,668, respectively     105,086     85,017
Other assets						                                         55,996     33,077

Total assets						                                    $   815,439  $ 483,940

Liabilities and Stockholders' Equity

Liabilities:
    Notes payable					               		              $     87,500  $ 127,500
    Accounts payable and accrued expenses		               245,256    152,911
    Commissions payable		                                  17,175     14,368
    Income taxes payable		                                  1,998      2,661
    Securities sold, not yet purchased, at market	            806      2,983
    Obligations under capital leases		                     71,428     33,376
    Loan subordinated to claims of general creditors 	     50,000	    50,000
       Total liabilities                                  474,163    383,799

Commitments and contingencies  (Note 11)				                   -	          -

Stockholders' equity:
    Common stock, $.0025 par value; authorized
        10,000,000 shares, issued and outstanding
        6,640,500 and 5,034,400 shares, respectively				   16,601    12,586
    Additional paid - in capital			              		       862,444	   398,334
    Accumulated deficit 				                             (349,644)	 (285,779)
    Total						                                           529,401    125,141
    Less: stock subscriptions receivable 		              (188,125)   (25,000)

         Total stockholders' equity			                    341,276    100,141

Total liabilities and stockholders' equity		          $   815,439  $ 483,940

</TABLE>

                    See accompanying notes to consolidated financial statements.












<PAGE>14

CASTLE  HOLDING  CORP. AND SUBSIDIARIES
Consolidated Statements of Operations

<TABLE>

                                                Year Ended September 30,
<S>                                                      1999         1998
    Revenues:                                    <C>             <C>
    Commissions	                                 $   2,943,352	  $ 1,659,444
    Principal transactions				                         359,213       235,770
    Interest and dividends				                           7,098	        4,485

       Total revenues			                             3,309,663     1,899,699

Expenses:
    Commissions						                                  461,035       247,985
    Clearing and execution costs				                   803,811	  	   248,543
    Communications 					                               303,693       179,728
    Advertising			                    	                 44,724        23,963
    Administrative compensation
         and employee benefits	  	                    752,542	       586,421
    Professional and consulting fees			     	         308,397	    	  195,624
    Registration and regulatory fees			     	          29,192	        31,827
    Occupancy						                                    64,220         45,143
    Interest						                                     31,829         27,276
    Other					                                        571,667	       496,584

        Total expenses			         	                 3,371,110      2,083,094

Loss before provision for income taxes		              (61,447)      (183,395)

Provision for income taxes 			                          2,418          3,323

Net loss 					                                  $     (63,865)  $   (186,718)

Net loss per share:
    Basic and diluted				                       $        (.01)  $       (.04)

Weighted average number of common
      shares outstanding				                         5,828,017      4,976,400


</TABLE>

                  See accompanying notes to consolidated financial statements.








<PAGE>15
CASTLE HOLDING CORP. AND SUBSIDIARIES
Consolidated Statements  of Changes in Stockholders' Equity
For the Years Ended September 30, 1999 and 1998
(Page 1 of 2)


<TABLE>
                   		                                    	                                            Total
              			                   			    Common Stock,        Additional   (Accum-     Stock Sub-   Stock-
		                                       $.0025  Par Value       Paid - in   ulated      scriptions   holders'
                                          Shares      Amount      Capital    Deficit)    Receivable   Equity

<S>                                       <C>        <C>         <C>        <C>         <C>          <C>
Balances, September 30, 1997		            4,898,400  $ 12,246    $  367,674 $ (99,061)  $  (25,000)	 $255,859

Issuance of  common shares to lessor in
November 1997 and charged to operations	     80,000       200         9,800     	    -      	     -    10,000

Issuance of  common shares to advertiser
in September 1998 and charged to
operations 		           		                   56,000       140        20,860          -      	     -     21,000

Net loss					                                     -         -             -   (186,718)           -   (186,718)

Balances, September 30, 1998			           5,034,400    12,586       398,334   (285,779)     (25,000)   100,141

Issuance of common shares to lessor in
October 1998 and charged to operations	     108,000       270	       13,230	         -	           -	    13,500

Issuance of common shares to two
customers in November 1998 in
legal settlement and charged to operations	  80,000       200	        9,800	         -	           -      10,000

Sale of common shares to investor in
February 1999 at $.25 per share	             40,000       100	        9,900 	        -      (10,000)          -

Sale of common shares to investor in
March 1999 at $.3125 per share	  	           40,000       100	       12,400	         -	           -      12,500

Sale of common shares to three CHC
directors (302,000 shares) and
three key employees (178,000 shares)
in March 1999 at $.3125 per share	          480,000     1,200	      148,800	         -	     (150,000)         -

Sale of common 	shares to investor in
April 1999 at $.3125  per share pursuant
to Rule 504 offering, less $35,000 offering
costs				 	                                 800,000     2,000	      213,000	          -	           -	   215,000




</TABLE>

       See accompanying notes to consolidated financial statements.












<PAGE>16



CASTLE HOLDING CORP. AND SUBSIDIARIES
Consolidated Statements  of Changes in Stockholders' Equity
For the Years Ended September 30, 1999 and 1998
(Page 2 of 2)

<TABLE>
            		                                    	                                      	                       Total
                                		                 		Common Stock,      Additional     (Accum-   Stock  Sub-	    Stock-
                  	            			                 $.0025  Par Value     Paid -in      ulated    scriptions 	    holders'
                                         			       Shares     Amount      Capital      Deficit)  Receivable 	    Equity
<S>                                                <C>       <C>          <C>           <C>          <C>         <C>

Issuance of common shares to advertiser
in May 1999 for prepaid advertising	               24,000       60	       35,940	             -	          -      36,000

Issuance of common shares to vendor in
July 1999 and charged to operations                 1,500	       4           746	             -           -	        750

Issuance of common shares to two
employees in July 1999 and charged to
operations	 			                                       800        2	          498   	          -  	        -         500

Issuance of common shares to consultant
in July 1999 for prepaid services	                  6,000       15 	       3,735 	            -           -       3,750

Issuance of common shares to employee in
August 1999 for prepaid services		                 12,000       30 	       7,470              - 	         -       7,500

Issuance of common shares to eight
employees in August 1999 and charged
to operations		            	    	                     800        2 	         498  	           -  	        -         500

Sale of common shares to key employee
in August 1999 at $.625 per share		                10,000       25         6,225              -      (6,250) 	        -

Sale of common shares to three key
employees in September 1999 at
$.625 per share			       	                          3,000        7         1,868  	           -      (1,875) 	        -

Collection of stock subscriptions
receivable in July 1999			                              -        - 	           - 	            -        5,000 	    5,000

Net loss					                                           -        -             -        (63,865)           -    (63,865)

Balances, September 30, 1999	                   6,640,500 $ 16,601     $ 862,444      $(349,644)  $ (188,125)   $341,276




</TABLE>

       See accompanying notes to consolidated financial statements.





<PAGE>17


CASTLE HOLDING CORP. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Page 1 of 2)


<TABLE>


							                                              Year  Ended  September  30,
<S>                                            								       <C>               <C>
                   		  				                     	             1999              1998


 Cash flows from operating activities:
    Net  loss 							                                         $    (63,865)	   	$ (186,718)
    Adjustments to reconcile net income (loss) to net cash
         provided by (used for) operating activities:
           Depreciation						                                  	    80,912          88,039
            Issuance of common stock for services and rent          72,500          31,000
    Changes in assets and liabilities:
         Due from brokers					                                      (71,478)	   	   49,501
         Securities owned				          	                             (9,499)        23,865
         Other assets					          	                               (22,919)        24,142
         Accounts payable and accrued expenses	          	           92,345 	      (61,454)
         Commissions payable			                                       2,807         (1,086)
         Income taxes payable					                                     (663)             1
         Securities sold, not yet purchased                          (2,177) 	     (11,679)

    Net cash provided by (used for) operating activities             77,963        (44,389)

Cash flows from investing activities:
    Purchases of equipment and leasehold improvements	              (52,785)       (48,802)

    Net cash used for investing activities                          (52,785)       (48,802)

Cash flows from financing activities:
    Proceeds from issuance of notes payable		     	                  60,000 	        50,000
    Net proceeds from sales of common stock		     	                 227,500            	  -
    Collection of stock subscriptions receivable		        	           5,000 			           -
    Repayment of notes payable				    	                            (100,000) 	     (100,204)
    Repayment of obligations under capital leases		                 (21,811)        (29,175)
    Net cash  provided by (used for) financing activities           170,689         (79,379)

Net increase (decrease) in cash and cash equivalents	               195,867        (172,570)

Cash and cash equivalents, beginning of year                        187,266 	       359,836

Cash and cash equivalents, end of year                           $  383,133      $  187,266


</TABLE>


See accompanying notes to consolidated financial statements.










<PAGE>18

CASTLE HOLDING CORP. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Page 2 of 2)


<TABLE>

	                                                      Year Ended September 30,
                                                             1999         1998
<S>                                                   <C>          <C>

Supplemental disclosures of cash flow information:
    Interest paid							                              $    34,579 	$    20,163

    Income taxes paid				                 	           $     3,081 	$     3,207

Schedule of non-cash operating activities:
    Issuance of common stock for services and rent   	$    72,500  $    31,000

Schedule of non-cash investing activities:
    Acquisition of equipment in connection
          with capital lease obligations         					$    59,863  $    43,87

    Retirement of fully depreciated equipment				     $    10,122	 $         -

Schedule of non-cash financing activities:
     Issuance of stock subscriptions receivable in
        connection with sale of common stock			      	$   168,125  $         -


</TABLE>

See accompanying notes to consolidated financial statements.





























<PAGE>19


CASTLE HOLDING CORP. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
For the Years Ended September 30, 1999 and 1998


1.       GENERAL

          Castle Holding Corp. ("CHC") is a holding company which was
          incorporated in Nevada on June 13, 1986.   CHC conducts substantially
          all of its business through its subsidiaries.

          On  December 28, 1998, CHC paid a 100% stock dividend to holders of
          record at the close of  business on December 22, 1998, thereby
          increasing the number of issued and outstanding common  shares from
          652,800 to 1,305,600.  On June 25, 1999, CHC paid a 300% stock
          dividend to holders of record at the close of business on June 18,
          1999, thereby increasing the number of issued and outstanding common
          shares from 1,651,600 to 6,606,400. All references to shares and
          per share amounts in the accompanying consolidated  financial
          statements have been restated to retroactively reflect these stock
          dividends.

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

          Basis of presentation - The consolidated financial statements include
          the accounts of  CHC and its fifteen subsidiaries (collectively,
          the "Company").    CHC's principal operating subsidiaries are
          Castle Securities Corp. ("CSC-1"), incorporated in the state of
          New York on December 7, 1984 and a securities broker-dealer
          headquartered in Freeport, New York and Citadel Securities Corp.
          ("CSC-2 " ), incorporated in the state of  New York on April 11, 1991
          and also a securities  broker-dealer and, since April 1996, market
          maker in NASDAQ, OTC Bulletin Board, and "Pink Sheets" securities
          from its office in Freeport, New York.

          The remaining thirteen  (13) subsidiaries of CHC are as follows:

            1.    Citadel Capital Corp. (95.0 % owned) (incorporated in
                  Delaware March 29, 1988) - inactive at September 30, 1999.
            2.	   Beverage King, Ltd. (100 % owned) (incorporated in Delaware
                  January 2, 1990) - subleases automobiles and equipment to
                  other CHC  subsidiaries.
            3.    Meroke Capital Corp. (100 % owned) (incorporated in New
                  York October 7, 1992) -  inactive at September 30, 1999.
            4.    Castle Trucking Corp. ( 100 % owned) (incorporated in
                  New York May 4, 1993) - subleases office space to other CHC
                  subsidiaries and others.
            5.    Castle Advisors Inc. (100 % owned) (incorporated in
                  New York December 23, 1993) - acts as general partner  for
                  a limited partnership in the business of securities
                  investment.
            6.	   Sparta Holding Corp. (100 % owned) (incorporated in Nevada
                  December 23, 1993) - inactive at September 30,  1999.
            7.	   Wall Street Indians, Ltd. (100 % owned) (incorporated in New
                  York May 27, 1994) - subleases office space and provides
                  communications and office services and supplies to other
                  CHC.  CHC subsidiaries and others.
            8.	   Chinamer International Corp. (100 % owned) (incorporated in
                  Nevada October 18, 1994) - inactive at September 30, 1999.







<PAGE>20

CASTLE HOLDING CORP. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
For the Years Ended September 30, 1999 and 1998

            9.	   Galaxynet Inc. (87.7 % owned) (incorporated in New York
                  December 15, 1995) - provides marketing, programming, and
                  communications services to other CHC subsidiaries.
           10.	   Rocketnet Inc. (87.7 % owned) (incorporated in Nevada
                  December 20, 1995) - provides software, marketing, and
                  communications services to other CHC subsidiaries.
           11.	   U Trade Inc. (100 % owned)  (incorporated in New York
                  November 17, 1997) - inactive at  September 30, 1999.
           12.    Java Trader Inc. (100% owned) (incorporated in Nevada
                  March 10, 1999) - inactive at September 30, 1999.
           13.    Long Island Web TV.Com Corp. (100% owned) (incorporated in
                  New York September 22, 1999) - inactive at September 30, 1999.

          All significant intercompany balances and transactions have been
          eliminated in consolidation.

          Revenue recognition - Securities transactions ( related revenue and
          expenses, including commissions and  principal transactions revenue
          and commissions expense) are recorded on a settlement date basis,
          which is generally three business days after trade date. Revenues
          and expenses on a trade date basis are not materially different
          from revenues and expenses  on a settlement date basis.

          Use of estimates - The preparation of the financial statements in
          conformity with generally accepted accounting principles requires
          management to make estimates and assumptions that affect the
          amounts reported in the financial statements and  accompanying
          notes. Actual results could differ from those estimates.

          Fair value disclosures - The carrying value of cash and cash
          equivalents, due from brokers, securities owned, accounts
          payable and accrued expenses,  commissions payable, income taxes
          payable, and securities sold,  not yet purchased are a reasonable
          estimate of their fair value.   The carrying value of  the Company's
          notes payable,  obligations under capital leases and,  loan
          subordinated to claims of general creditors, at September 30, 1999
          are a reasonable estimate of  their fair value based upon currently
          available  interest rates of similar instruments available with
          similar maturities.

          Cash and cash equivalents - At September 30, 1999, cash and cash
          equivalents included $152,589 in money market funds and $47,213 in
          cash not covered by FDIC insurance.   The Company considers such risk
          to be minimal.

          Securities owned and securities sold, not yet purchased - Marketable
          securities are valued at market and unrealized gains and losses are
          reflected in income. Securities for which no ready market exists are
          valued at estimated fair value as determined by  the Board of
          Directors.

          Equipment, equipment under capital leases, and leasehold improvements
          - Equipment, equipment under capital leases, and leasehold
          improvements are stated at cost. Equipment, and equipment under
          capital leases are depreciated using the straight-line method over
          the estimated useful lives of the respective assets,  generally three
          to seven years. Leasehold improvements are amortized over the
          respective remaining lease terms on a straight-line basis.

          Income taxes - The Company accounts for income taxes in accordance
          with Statement of Financial Accounting Standards  ("SFAS") No. 109,
          "Accounting For Income Taxes". Deferred tax assets and  liabilities
          are determined based on the difference between the financial
          statement and tax bases of  assets and liabilities, using enacted
          tax rates in effect for the year in which the differences are
          expected to reverse.   Current income taxes are based on the year's
          income taxable for Federal and State income tax reporting
          purposes. Deferred income taxes, if any, reflect the net effects of
          temporary differences between the carrying amounts of assets and
          liabilities for financial reporting purposes and the amounts used
          for income tax purposes.






<PAGE>21


CASTLE HOLDING CORP. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
For the Years Ended September 30, 1999 and 1998


  Earnings per share - During 1997, the Financial Accounting Standards Board
  issued SFAS No. 128, "Earnings Per Share."  SFAS No. 128 replaced the
  previously required reporting of  primary and fully diluted earnings per
  share with basic and diluted earnings per share, respectively.   Unlike the
  previously reported primary earnings per share, basic earnings per share
  excludes the dilutive effects of  stock options.  Diluted earnings  per
  share is similar to the previously reported fully diluted earnings per
  share.   Earnings per share amounts for all periods  presented have been
  calculated in accordance with the requirements of  SFAS No. 128.

  Impact of recently issued accounting standards - The Company does not believe
  that any recently issued accounting standards,  not yet adopted by the
  Company, will have a material impact on  its consolidated financial position
  and results of operations  when adopted.

  Reclassifications - Certain prior year balances have been reclassified to
  conform to current year presentation.


3. SECURITIES OWNED,  AT MARKET VALUE AND SECURITIES SOLD, NOT YET  PURCHASED,
    AT MARKET

<TABLE>
                                                                  September 30,

<S>
	Securities owned,  at market value consist of:                         1999           1998
                                                                 <C>              <C>
	    Trading accounts:
	       Corporate equities - listed on Nasdaq Stock Market	      $         -      $   1,188
	       Corporate equities - listed on OTC Bulletin Board
                         or "Pink Sheets"  					                      34,972         20,753

		Total trading accounts				                                          34,972	        21,941

	    Investment accounts				                                             648          4,180

	    Totals						                                                $    35,620      $  26,121

 Securities sold, not yet purchased, at market consist of:

	     Trading accounts:
	          Corporate equities - listed on Nasdaq Stock Market	   $         -      $   2,983
           Corporate equities  - listed on OTC Bulletin Board
                          or "Pink Sheets"  					                        806              -
	     Totals						                                               $       806      $   2,983

</TABLE>













<PAGE>22


CASTLE HOLDING CORP. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
For the Years Ended September 30, 1999 and 1998


<TABLE>

4.   NOTES  PAYABLE
      					               	                                        September 30,
			   <S>                                     						                   <C>              <C>
     Notes payable consist of:                                         1999             1998
	     Note payable to officer, interest at 12% paid annually,
	        due on demand	   					                                        $  22,500	       $  22,500
	    Note payable to affiliate of officer, interest at 12%
	        paid annually, due on demand                      	 	                 -  	        50,000
	    Note payable to The OTC Equity
	        Fund,  Inc. ("OEF"),  interest at 12%  paid
	        annually, due on demand			                                       55,000 	         55,000
	    Note payable to investor, interest at 6%, convertible
     into 40,000 shares of CHC common stock, due
     March 31, 2000				                                                   10,000	               -

	    Totals							                                                     $  87,500        $ 127,500
</TABLE>

         On December 21, 1998, CHC obtained a $100,000 business revolving
         credit line from a financial institution.   Such line of credit is
         personally guaranteed by CHC's president and treasurer and is
         available for one year and borrowings thereunder bear interest at prime
         rate plus .5% and amortize over 36 equal monthly installments.
         In December 1998, CHC borrowed $50,000 under the line which was
         subsequently  repaid.

5.       OBLIGATIONS UNDER CAPITAL LEASES

          The Company, through its subsidiaries, has acquired office machinery
          and equipment pursuant to various noncancellable capital lease
          agreements.   All of the lease agreements are secured by the
          related equipment.

          At September 30, 1999,  the aggregate future minimum remaining
          lease payments under noncancellable capital lease agreements were
          as follows:
<TABLE>


    Year Ended
  September 30,		                                           Amount
<S>		                                                  <C>
		   2000						                                        $    44,863
     2001                                                   26,404
     2002                                     					         13,296

    Total 					                                             84,563

	   Less amount representing interest                      (13,135)

	   Net present value of capital lease obligations	    $    71,428


</TABLE>






<PAGE>23

CASTLE HOLDING CORP. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
For the Years Ended September 30, 1999 and 1998


6.  LOAN  FROM  RELATED PARTY SUBORDINATED  TO  CLAIMS OF GENERAL  CREDITORS

     On September 6, 1995, CSC-2 executed a loan agreement with OEF,  a
     corporation whose secretary is also the president of CHC, whereby OEF
     advanced $50,000 to CSC-2.   The $50,000 subordinated loan payable
     bears interest at 12% per annum payable annually each September 30 and is
     due on  September 30, 2001.

     The loan is pursuant to an agreement filed with the NASD and is permitted
     in computing net capital under the Securities and Exchange Commission's
     Uniform Net Capital Rule (see note 9). To the extent that such borrowing is
     used by CSC-2 for continued compliance with minimum net capital rules,
     said loan will not be repaid.

 7.  1998 INCENTIVE STOCK OPTION PLAN

      The Company accounts for stock-based employee compensation arrangements in
      accordance with provisions of Accounting  Principles Board Opinion
      No. 25, "Accounting for Stock Issued to Employees" ("APB No. 25") and
      complies with the disclosure provisions of Statement of Financial
      Accounting Standards ("SFAS") No. 123, "Accounting for Stock-Based
      Compensation" ("SFAS No. 123").  Under APB No. 25, unearned compensation
      is based on the difference, if any, on the date of the grant, between the
      fair value of the Company's stock and the exercise price.  Unearned
      compensation is amortized and expensed in accordance with Financial
      Accounting Standards Board Interpretation No. 28 using the multiple
      option approach.   The Company accounts for stock-based compensation
      issued to non-employees in accordance with the provisions of SFAS No.
      123 and Emerging Issues Task Force No. 96-18, "Accounting for Equity
      Instruments That Are Issued to Other Than Employees for Acquiring or in
      Conjunction with Selling, Goods or Services".

      On December 31, 1998, CHC granted stock options (for a total of 394,000
      shares of its common stock)  to 40 employees of the Company.   The
      options provide the respective employees the right to purchase CHC
      common stock at a price of $.75 per share and are exercisable and vest
      at a rate of 20% for each  year commencing December 31, 1999.

      Activity relating to the Company's stock options follows:


<TABLE>
                                                  							Number of
						                                                     Shares
<S>                                                     <C>
 Balance at September 30, 1998		                              -
	Granted during the year		                              394,000
	Forfeited during the year			                           (34,000)

	Balance at  September 30, 1999		                       360,000
</TABLE>

















<PAGE>24


CASTLE HOLDING CORP. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
For the Years Ended September 30, 1999 and 1998


       The Company has adopted the disclosure only provisions of SFAS No. 123,
       "Accounting for Stock- Based Compensation".   Accordingly, no
       compensation costs have been recognized for the options granted.   Had
       compensation cost been determined based on the fair value at the date of
       grant consistent with the provision of  SFAS No. 123, the Company's
       net  loss and net loss per share would have been as follows:


<TABLE>

									                                                   Year Ended
								                                                	September 30, 1999
    <S>                                                 <C>

  	   Net loss - as reported				                       	$    (63,865)

  	   Net loss - pro forma						                        $    (67,805)

  	   Basic net loss per share - as reported		         	$       (.01)

  	   Basic net loss per share - pro forma				          $       (.01)

  	   Diluted net loss per share - as reported				      $       (.01)

      Diluted net loss per share - pro forma				        $       (.01)

</TABLE>

The fair value of each option grant is estimated on the date of grant using the
Black-Scholes option pricing model


 8.      INCOME TAXES

          CHC files a consolidated income tax return with its subsidiaries for
          federal reporting purposes.
          CHC and its subsidiaries file separate income tax returns for state
          reporting purposes.


The provisions for income taxes consist of:		   Year Ended September 30,
<TABLE>
   					                                           1999         1998
   <S>                                       <C>            <C>
   Current:
	     Federal					                           $        -   	 $       -
      State						                                 2,418         3,323
	     Total		                          				       2,418         3,323

   Deferred:
      Federal						                             (18,938)      (55,622)
      State					                                 (5,751)	     (16,894)
      Valuation allowance				                    24,689 	      72,516
      Total						                                     -             -
   Total provision for income taxes			      	$   2,418	 	$      3,323

</TABLE>










<PAGE>25

CASTLE HOLDING CORP. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
For the Years Ended September 30, 1999 and 1998


          A reconciliation of the computed expected income tax expense to the
          provision for income taxes follows:

<TABLE>
				<S>                                           <C>        <C>
	   Computed Federal income tax at 34%		      	   $(20,892)	 $   (61,366)
	   State income taxes (benefit) less Federal
	       income tax benefit 					                    (3,797)	     (11,150)
	   Change in valuation allowance				               24,689	       72,516
	   Minimum state income tax				                     2,418         3,323

	   Total provision for income taxes	             $  2,418  	 $    3,323
</TABLE>

         Based on management's present assessment, the Company has not yet
         determined it to be more likely than  not that a deferred tax asset
         of $157,914 attributable to the future utilization of  $393,035 of net
         operating loss carryforwards as of September 30, 1999 will be
         realized.  Accordingly, the Company has provided a 100 % allowance
         against the deferred tax asset in the financial statements at
         September 30, 1999.    The Company will continue to review this
         valuation allowance and make adjustments as appropriate.  The net
         operating loss carryforwards expire $148,193 in year 2012, $183,395
         in year 2013, and $61,447 in year 2014.


  9.     NET CAPITAL REQUIREMENTS

          As broker-dealers, CSC-1 and CSC-2 are subject to the Securities and
          Exchange Commission Uniform Net Capital Rule (the "Rule"). The Rule
          requires the maintenance of minimum net capital and requires that the
          ratio of aggregate indebtedness, as defined, to net capital, as
          defined, not exceed 15 to 1.  At September 30, 1999, CSC-1 had net
          capital of $88,496, which was $79,552 in excess of its required net
          capital of $8,944 and its ratio of aggregate indebtedness to net
          capital was 1.52 to 1.   At September 30, 1999, CSC-2 had net
          capital of $213,582, which was $113,582 in excess of its required
          net capital of  $100,000 and its ratio of  aggregate indebtedness
          to net capital was .08 to 1.

         Pursuant to a restrictive agreement dated October 26, 1995 with the
         NASD, CSC-2 agreed to maintain minimum net capital of at least
         $120,000.   Accordingly, at September 30, 1999, the Company had net
         capital in excess of the NASD minimum required amount of $93,582.

10.     RELATED PARTY TRANSACTIONS

          Expense allowance - For the years ended September 30, 1999 and 1998,
          the Company paid $64,000 and $42,000, respectively, to its
          president and treasurer for accountable expenses pursuant to an
          agreement with the Company.

          Sea Friends Incorporated - During the year ended September 30, 1999,
          the Company received $13,000 from Sea Friends Incorporated, a
          not-for profit corporation,  for usage of the Company's facilities.
          The Company's president and secretary /treasurer are also directors of
          Sea Friends Incorporated.











<PAGE>26


CASTLE HOLDING CORP. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
For the Years Ended September 30, 1999 and 1998



11.     COMMITMENTS  AND  CONTINGENCIES

          Year 2000 - The Company has evaluated the potential impact of the year
          2000 on its business, including its information systems and those of
          its clearing agent, and does not expect this issue to have a
          significant effect on its results of operations.

          Operating leases - The Company leases its headquarters office space
          (approximately 16,000 square feet) under six noncancellable operating
          lease agreements which expire between October 2000 and October 2002,
          with renewal options available to October 2007.  Such lease
          agreements require minimum monthly rental payments of $ 6,417.
          The Company leases its autos and equipment under  noncancellable
          operating lease agreements which expire between January 2000 and
          July 2004 and require minimum monthly rental payments of
          approximately $5,369.


          Rent expense under all operating leases consisted of:

<TABLE>

	  				                  	                 Year Ended September 30,
                              			           1999	             1998
                                     <C>               <C>
     <S>
	    Headquarters office space   				$    64,220	      $    45,143
	    Autos and equipment			  	            68,692            98,464

	    Totals				                      $   132,912	      $   143,607

</TABLE>

         At September 30, 1999, the aggregate future minimum lease payments
         under noncancellable operating lease agreements are as follows:

<TABLE>

   <S>
                        Headquarters
		  Year Ended	            Office	           Autos and
		September 30,    	       Space      	      Equipment           Totals
     <C>           <C>                     <C>                 <C>

	    2000          $      76,627 	         $  35,739     	     $ 112,366
	    2001		               48,217	             10,170	             58,387
	    2002		               45,600	              4,732	             50,332
	    2003 		               3,800 	             2,591	              6,391
	   	2004 		                   -	              1,943      	        1,943
  	  Thereafter          	     - 	                 -	                  -

  	  Totals 	      	$    174,244	          $  55,175     	     $ 229,419

</TABLE>






<PAGE>27






CASTLE HOLDING CORP. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
For the Years Ended September 30, 1999 and 1998


	         Clearing agreement - On November 5, 1997,  CSC-1 renewed its clearing
          agreement for a two year period and released the clearing agent
          from any prior clearing   fee disputes.  In connection therewith,
          CSC-1 received a $200,000 signing bonus from the  clearing agent on
          November 12, 1997 and received $66,162 free clearing charges in
          December 1997 and January 1998.  The $266,162  total is reflected
          in the consolidated statement of  operations for the year ended
          September 30, 1998 as a reduction in clearing and execution costs.

          Litigation - On September 13, 1994, the Securities and Exchange
          Commission (the "SEC") filed a civil action against CSC-1, its
          president, a former registered representative, and eight other
          defendants.  The action alleges violations of Sections 5(a) and
          (c), and 17(a) of the Securities Act of 1933, Sections 10 (b) and
          15c of the  Securities Exchange Act of 1934 and Rules l0b3, l0b-5,
          l0b-6, and 15cl-2 thereunder. The complaint seeks injunctive relief
          and disgorgement of profits approximating $175,000.   CSC-1 answered
          the complaint and is vigorously defending the action.

          On October 6, 1994, the NASD Market Surveillance Committee
          (the "MSC") commenced a disciplinary proceeding against CSC-1, its
          president, and two former registered representatives.  The
          Complaint alleges violations of Article III, Sections 1, 4, 18, and 27
          of the Association's Rules of Fair Practice and Section 10(b) of
          the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.
          After a hearing on June 20, 1995, the MSC, in its Decision dated
          February 7, 1996, fined CSC-1 and its president jointly and
          severally $25,000 and ordered them to make restitution to specified
          customers totaling approximately $10,000. CSC-1 and its president
          appealed the Decision to the National Business Conduct Committee
          (the "NBCC") of the NASD and a hearing of the appeal was held on
          June 7, 1996. In its Amended Decision dated October 21, 1996, the
          NBCC affirmed the fines and  restitution order. On November 15,
          1996, CSC-1 and its  president appealed the NBCC Amended Decision
          to the SEC. On January 7, 1998, the SEC affirmed the NBCC Amended
          Decision.  On  May 18, 1998, the SEC denied CSC-1's Motion for
          Reconsideration filed January 21, 1998.   On February 5, 1998 and
          June 15, 1998,  CSC-1 and its president filed petitions for review
          of the SEC actions to the  Second Circuit of the United States
          Court of Appeals, which matters are pending.

          Other CHC subsidiaries have  also been named as defendants in civil
          cases arising in the ordinary course of business.  The Company
          believes that it has meritorious defenses to these actions and
          intends to vigorously contest them.

          Management believes, based upon discussions with counsel, that the
          outcome of the litigation described above will not have a material
          effect on the Company's consolidated financial position.  The
          materiality of legal matters on the Company's future operating
          results depends on the level of future results of operations as
          well as the timing and ultimate outcome of such legal matters.

          As of September 30, 1999, the Company accrued approximately $50,000 in
          connection with the above litigations.   Such amount is included in
          accounts payable and accrued expenses.



<PAGE>28

CASTLE HOLDING CORP. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
For the Years Ended September 30, 1999 and 1998




12.    CONCENTRATION  OF  CREDIT  RISK

          In the normal course of business, CSC-1 executes as agent
          transactions on behalf of customers and CSC-2 executes principal
          transactions with other broker-dealers. If the agency or principal
          transactions do not  settle because of failure to perform by either
          the customer or the counterparty, CSC-1 or CSC-2 may be obligated
          to discharge the obligation of the nonperforming party and, as a
          result, may incur a loss if the market value of the securities are
          different from the contract amount of the transactions.

          CSC-l's clearing agent seeks to control the risks associated with
          CSC-l's customer activities by requiring customers to maintain
          margin collateral in compliance with various regulatory and
          internal guidelines.  CSC-l's clearing agent monitors required
          margin levels daily, and pursuant to such guidelines, requires the
          customers to deposit additional collateral, or to reduce positions,
          when necessary.

          Business concentration - For the year ended September 30, 1999,
          approximately 75% of the Company's revenues were derived from
          unsolicited customer transactions ordered online over the internet.





<PAGE>29




































PART III



Item 9.   DIRECTORS AND EXECUTIVE OFFICERS

(a)	The directors of the Registrant are:

		Director:
          Name 	          Age	        Other Offices Held 	      Since

  Daniel J. Priscu		      77	            Chairman		              1987

 	George R. Hebert		      55	            President		             1987

 	Michael T. Studer       49	            Secretary, Treasurer	   1987


Each director will hold office until the next annual meeting of shareholders
(expected to be held in March 2000) and until their successors have been
elected and qualified.



	The executive officers of the Registrant are:


		Officer:
		         Name 		           Age		      Other Offices Held	     Since

   		Daniel J. Priscu	    	   77		         Chairmam		             1987

	   	George R. Hebert		       55	          President		            1987

   		Michael T. Studer	       49		         Secretary, Treasurer 	 1987




Officers of the Registrant are elected by the Board of Directors at the annual
meetings of the Registrant's shareholders, and hold office until their death, or
until they shall resign or have been  removed from office.

The business experience during the last five years for each director and
executive officer of the Registrant follows:

Daniel J. Priscu has been Chairman and a director of the Registrant since
September 1987.  Mr. Priscu received a B.A. degree from De Pauw University in
1947.

George R. Hebert has been President and a director of the Registrant since
September 1987.  He also has been a registered representative and economist
with CSC-1 since September 1987 and CSC-2 since October 1995.  Mr. Hebert
received a B.S. degree from Stevens Academy, Pennsylvania Military College
(now Widener University) in 1967.

Michael T. Studer has been Secretary, Treasurer, and a Director of the
Registrant since September 1987.   He has also been President of
Michael T. Studer, CPA, P.C., a public accounting firm, since July 1987,
President of CSC-1 since its inception in December 1984, and President of
CSC-2 since October 1995.  Mr. Studer received a B.S.B.A. degree from Babson
College in 1971.

<PAGE>30

(b)	Another significant employee of the Registrant is Thomas Shaughnessy, age
    45.  Mr. Shaughnessy has been general securities principal and chief
    compliance officer of CSC-1 since July 1, 1993, general securities
    principal and chief compliance officer of CSC-2 since October 1995, and
    was Assistant to the President of CSC-1 from December 1992 to June 1993.
    Since May 1972, he has served in the United States Marine Corps on both a
    full-time and part-time basis.  Mr. Shaughnessy received a B.S.B.A.
    degree from State University of New York at Brockport in 1978 and a
    M.B.A. degree from National University in 1988.

(c)	There is no family relationship between any director, executive officer or
    significant employee of the Registrant.





Item 10.  EXECUTIVE COMPENSATION

          The following table sets forth all cash compensation paid by the
          Company during the years ended September 30, 1997, 1998 and 1999
          to each  executive officer and director of the Company:

<TABLE>


<S>                                          			 Annual       All Other
	Name and Principal Position	          Year     	Salary		     Compensation
                                       <C>     <C>             <C>
	George R. Hebert, President	          1999	   $44,200		       $32,000   (1)
					                                  1998	    44,200		        21,000   (1)
                                  					1997	    44,200		        24,000   (1)

	Michael T. Studer, Secretary,	        1999	    44,200		        32,000   (1)
	Treasurer			                          1998     44,200 	 	      21,000   (1)
					                                  1997	    44,200		        24,000   (1)

	Daniel J. Priscu, Chairman of        	1999	         - 		          600   (2)
 The Board			                          1998	         -  	          400   (2)
                	                   			1997	         - 	           400   (2)

(1)	Represents an allowance for accountable expenses.
(2)	Represents directors fees.


</TABLE>






<PAGE>31












	Item 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth, at September 30, 1999, the stock ownership of
each person known by the Company to be the beneficial owner of five percent
or more of the Company's common stock, all executive officers and directors
individually, and all executive officers and directors of the Company as a
group:
<TABLE>
<S>
Name and Address		             	Amount and Nature	              Percent of
of Beneficial Owner			        of Beneficial Owner     (1)		        Class
                                       <C>                         <C>
Daniel J. Priscu					                     49,600		                  0.7%
4555 Blackstone Drive
Indianapolis, Indiana  46237

George R. Hebert					                  1,965,300       (2)         29.6%
183 Gordon Place
Freeport, NY  11520

Michael T. Studer				                  1,929,600       (3)         29.1%
410 McDermott Road
Rockville Centre, NY  11570

Plymouth Partners, LP				                533,500		                  8.0%
10826 Omaha Trace
Union, KY  41091

All executive officers and
Directors as a group (3 persons)		     	3,944,500		                59.4%
</TABLE>
_________________________________________
(1)	Unless otherwise indicated below, the Company has been advised that each
    person named above is the record owner of and exercises the sole voting
    and investment power over the shares shown opposite his name.
(2)	Includes 164,500 shares held in trust for the benefit of Mr. Hebert's
    daughter, 114,800 shares owned by Mr. Hebert's wife, and 50% of 40,000
    shares owned by Sea Friends Incorporated, of which organization Mr. Hebert
    is president and a director, all of which Mr. Hebert disclaims beneficial
    ownership of. Includes 50% of 640,000 shares owned by CALP (CHC Deferred
    Compensation Plan for benefit of George R. Hebert owns a 50% limited
    partnership interest therein) which Mr. Hebert doesn't exercise sole
    voting and investment power over.
(3)	Includes 120,000 shares held in trust for Mr. Studer's children and 50% of
    40,000 shares owned by Sea Friends Incorporated, of which organization
    Mr. Studer is treasurer and a director, which Mr. Studer disclaims
    beneficial ownership of.  Includes 50% of 640,000 shares owned by CALP
    (CHC Deferred Compensation Plan for benefit of Michael T. Studer owns a 50%
    limited partnership interest therein) which Mr. Studer does not exercise
    sole voting and investment power over.


	Item 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS


As of  September 30, 1999, the Registrant had notes payable to The OTC Equity
Fund, Inc., a corporation whose secretary is also president of the Registrant,
and Michael T. Studer, secretary and treasurer of the Registrant, in amounts of
$55,000 and $22,500, respectively.  Such notes bear interest at the rate of 12%
per annum and are due on demand.

As of September 30, 1999, Citadel had a loan payable subordinated to claims of
general creditors to The OTC Equity Fund, Inc. in the amount of $50,000. The
loan bears interest at the rate of 12% per annum and is due September 30, 2001.

In April 1998, the Registrant borrowed $50,000 from the wife of the president of
the Registrant.  The note, which was repaid in April 1999, beared interest at
the rate of 12% per annum and was due on demand.

In March 1999, the Registrant sold  8000 common shares to Daniel J. Priscu
(chairman of the Registrant), 98,000 common shares to George R. Hebert
(president of the Registrant), 196,000 common shares to Michael T Studer
(secretary and treasurer of the Registrant) and 98,000 common shares to
Teresa M. Hebert (wife of the president of the Registrant),  at a price of
 .3125 per share, in exchange for promissory notes in the amounts of $2,500,
$30,625, $61,250, and $30,625, respectively.

<PAGE>32

Item 13.  EXHIBITS AND REPORTS ON FORM 8-K

(a)   Exhibits

       See Exhibit Index.

 (b)  Reports on Form 8-K

        None.



SIGNATURES


Pursuant to the requirements of Section 13 or 15(d) 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.


CASTLE HOLDING CORP.


By	/s/  George R. Hebert
George R. Hebert, President
Dated December 29, 1999



Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the Registrant
and in the capacities indicated on the dates indicated.


		Signature			                          Title				                     Date
_______________________________________________________________________________

___________________________     Chairman of the Board of	  		December 29, 1999
Daniel J. Priscu				            Directors, Director






/s/ George R. Hebert             President, Director			       December 29, 1999
George R. Hebert



/s/ Michael T. Studer            Secretary, Treasurer, 			    December 29, 1999
Michael T. Studer				            Principal Financial and
						                           Accounting Officer,
						                           Director








<PAGE>33

EXHIBIT INDEX

	3.1*	Articles of Incorporation (Form S-18 Registration
		    No. 33-8395-LA, effective November 14, 1986)

	3.2*	Amendments to Articles of Incorporation (Form S-18 Registration
		    No. 33-37809-NY, effective February 11, 1991)

	3.3*	By-laws (Form S-18 Registration No. 33-8395-LA, effective
      November 14,1986)

	4.4*	Specimen Stock Certificate (Form S-18 Registration No. 33-37809-NY,
      effective February 11, 1991)

 22	  Subsidiaries of the Registrant (Filed herewith)

 27	  Financial Data Schedule (Filed herewith)

99.1* Complaint for Injunctive and Other Relief (dated September 13, 1994) -
      Securities and Exchange Commission, Plaintiff (Form 8-K dated
      September 13, 1994)

              * Previously filed











<PAGE>34













Exhibit No. 22- Subsidiaries of the Registrant
Castle Holding Corp.
Form 10-KSB for the fiscal year ended September 30, 1999





1.	Castle Securities Corp. (New York)
2.	Citadel Capital Corp. (Delaware)
3.	Beverage King, Ltd. (Delaware)
4.	Citadel Securities Corp. (New York)
5.	Meroke Capital Corp. (New York)
6.	Castle Trucking Corp. (New York)
7.	Castle Advisors Inc. (New York)
8.	Sparta Holding Corp. (Nevada)
9.	Wall Street Indians, Ltd. (New York)
10.	Chinamer International  Corp. (Nevada)
11.	Galaxynet Inc. (New York)
12.	Rocketnet Inc. (Nevada)
13.	U Trade Inc. (New York)
14.	Java Trader Inc. (Nevada)
15.	Long Island Web TV.Com Corp. (New York)




<PAGE>35

EXHIBIT 27
Financial Data Schedule for the year ended September 30, 1999 required pursuant
to Item 601(c) of Regulation S-B

[NAME] CASTLE HOLDING CORP.
[MULTIPLIER] 1
[CURRENCY] 1
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END]SEP-30-1999
[PERIOD-START]OCT-01-1998
[PERIOD-END]SEP-30-1999
[EXCHANGE-RATE] 1
[CASH] 383,133
[RECEIVABLES] 137,455
[SECURITIES-RESALE] 0
[SECURITIES-BORROWED] 0
[INSTRUMENTS-OWNED] 35,620
[PP&E] 203,235
[TOTAL-ASSETS] 815,439
[SHORT-TERM] 87,500
[PAYABLES] 264,429
[REPOS-SOLD] 0
[SECURITIES-LOANED] 0
[INSTRUMENTS-SOLD] 806
<LONG TERM> 121,428
[COMMON] 16,601
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[OTHER-SE] 324,675
[TOTAL-LIABILITY-AND-EQUITY] 815,439
[TRADING-REVENUE] 359,213
[INTEREST-DIVIDENDS] 7,098
[COMMISSIONS] 2,943,352
[INVESTMENT-BANKING-REVENUES] 0
[FEE-REVENUE] 0
[INTEREST-EXPENSE] 31,829
[COMPENSATION] 1,213,577
[INCOME-PRETAX] (61,447)
[INCOME-PRE-EXTRAORDINARY] (61,447)
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] (63,865)
[EPS-BASIC] (.01)
[EPS-DILUTED]  (.01)



<PAGE>36











1

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