UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    FORM 10-Q

(Mark One)

      |X|   Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
            Exchange Act of 1934

For the quarter ended July 3, 1999

                                       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 0-22053

                           GENERAL BEARING CORPORATION
                           ---------------------------
             (Exact name of registrant as specified in its charter)

Delaware                                                    13-2796245
--------                                                    ----------
State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                              Identification No.)

44 High Street, West Nyack, New York                        10994
------------------------------------                        -----
(Address of principal executive offices)                    (Zip Code)

Registrant's telephone number, including area code: (914) 358-6000

Securities registered pursuant to Section 12(b) of the Act: NONE

Securities registered pursuant to Section 12(g) of the Act:

                      Common Stock $.01 par value per share
                      -------------------------------------
                                (Title of class)

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

At August 2, 1999, the Registrant had issued and outstanding 3,924,950 shares of
common stock, $.01 par value per share.
<PAGE>

          CAUTIONARY STATEMENT RELEVANT TO FORWARD-LOOKING INFORMATION
               FOR THE PURPOSE OF "SAFE HARBOR" PROVISIONS OF THE
                PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.

      The Private Securities Litigation Reform Act of 1995 provides a "safe
harbor" for forward-looking statements, which are statements other than those of
historical fact, including, without limitation, ones identified by the use of
the words "anticipates,""estimates," "expects," "intends," "plans," "predicts,"
and similar expressions. In this Quarterly Report such statements may relate,
among other things, to the recoverability of deferred taxes, likely industry
trends, the continued availability of credit lines, the suitability of
facilities, access to suppliers and implementation of joint ventures and
marketing programs. Such forward looking statements involve important risks and
uncertainties that could cause actual results to differ materially from those
expected by the Company, and such statements should be read along with the
cautionary statements accompanying them and mindful of the following additional
risks and uncertainties possibly affecting the Company: the possibility of a
general economic downturn, which is likely to have an important impact on
historically cyclical industries such as manufacturing; significant price,
quality, quantity or marketing efforts from domestic or overseas competitors;
the loss of, or substantial reduction in orders from, a major customer; the loss
of, or failure to attain additional quality certifications; changes in U.S. or
foreign government regulations and policies, including the imposition of
antidumping orders on the Company or any of its suppliers; a significant
judgment or order against the Company in a legal or administrative proceeding;
and potential delays in implementing planned sales and marketing expansion
efforts and the failure of their effectiveness upon implementation.
<PAGE>

                           GENERAL BEARING CORPORATION

                          QUARTERLY REPORT ON FORM 10-Q
                       FOR THE QUARTER ENDED JULY 3, 1999

                                TABLE OF CONTENTS

                                                                        Page No.
                                                                        --------
PART I

  Item 1.   Financial Statements .........................................2 - 6
  Item 2.   Management's Discussion and Analysis of Results of
              Operations and Financial Condition.........................7 - 10

PART II

  Item 1.   Legal Proceedings................................................11
  Item 5.   Other Information................................................12
  Item 6.   Exhibits and Reports on Form 8-K.................................12

Signature  ..................................................................13


                                                                               1
<PAGE>

                             FINANCIAL STATEMENTS OF
                           GENERAL BEARING CORPORATION
                                AND SUBSIDIARIES

Item 1.                    CONSOLIDATED BALANCE SHEETS
              (In Thousands - Except for Shares and Per Share Data)

<TABLE>
<CAPTION>
                                                                  July 3,     Jan. 2,
                                                                   1999        1999
                                                                 --------    --------
                              ASSETS                            (Unaudited)
<S>                                                              <C>         <C>
Current:
    Cash                                                         $     14    $     29
    Accounts receivable - trade, less allowance for doubtful
       accounts of $201K and $200K                                  6,104       5,772
    Inventories                                                    18,249      16,423
    Prepaid expenses and other current assets                         593         358
    Advances to parent and affiliates                               1,403         940
    Deferred tax asset                                                326         437
                                                                 --------    --------

          Total current assets                                     26,689      23,959
                                                                 --------    --------

Fixed assets, net                                                   3,339       3,277

Investments in affiliates                                           1,711       1,695

Advances to affiliate                                                 432         423

Deferred tax asset, net                                                --         956

Other assets                                                           37          28
                                                                 --------    --------

          Total Assets                                           $ 32,208    $ 30,338
                                                                 ========    ========

              LIABILITIES AND STOCKHOLDERS' EQUITY
Current:
    Note payable - bank                                          $  8,622    $  8,126
    Accounts payable:
       Trade                                                        1,460       1,271
       Affiliate                                                       --           3
       Parent                                                          29          94
    Accrued expenses and other current liabilities                  1,104       1,128
    Current maturities of long-term debt                               63         286
                                                                 --------    --------

          Total current liabilities                                11,278      10,908
                                                                 --------    --------

Long-term debt, less current maturities:
    Bank                                                               --         557
    Other                                                             440         440
    Affiliate                                                         975         954
                                                                 --------    --------

          Total long-term liabilities                               1,415       1,951
                                                                 --------    --------

Commitments and contingencies

Stockholders' equity:
    Preferred stock par value $.01 per share - shares
       authorized 1,000,000 none issued and outstanding                --          --
    Common stock par value $.01 per share - shares
       authorized 19,000,000, issued and outstanding 3,921,950
       and 3,918,950 shares                                            39          39
    Additional paid-in capital                                     28,779      28,758
    Deficit                                                        (9,303)    (11,318)
                                                                 --------    --------

          Total stockholders' equity                               19,515      17,479
                                                                 --------    --------

Total liabilities and stockholder's equity                       $ 32,208    $ 30,338
                                                                 ========    ========
</TABLE>

      See accompanying notes to condensed consolidated financial statements


                                                                               2
<PAGE>

                             FINANCIAL STATEMENTS OF
                           GENERAL BEARING CORPORATION
                                AND SUBSIDIARIES

                        CONSOLIDATED STATEMENTS OF INCOME
                                   (UNAUDITED)
              (In Thousands - Except for Shares and Per Share Data)

<TABLE>
<CAPTION>
                                                 Twenty-six weeks ended         Thirteen weeks ended
                                               --------------------------    --------------------------
                                                  July 3,       June 27,        July 3,        June 27,
                                                   1999           1998           1999           1998
                                               -----------    -----------    -----------    -----------
<S>                                            <C>            <C>            <C>            <C>
Sales                                          $    28,159    $    21,348    $    14,437    $    11,011
Cost of sales                                       19,462         14,490         10,079          7,183
                                               -----------    -----------    -----------    -----------
Gross profit                                         8,697          6,858          4,358          3,828
Selling, general and administrative expenses         5,082          4,651          2,551          2,494
                                               -----------    -----------    -----------    -----------
Operating income                                     3,615          2,207          1,807          1,334

Interest, net, including ($13K), $7K, ($6K),
and $6K to parent                                      410            354            205            196

Equity in income of affiliates                         (16)            --            (16)            --

Gain on sale of equipment                               --           (295)            --             --
                                               -----------    -----------    -----------    -----------
Income before income taxes                           3,221          2,148          1,618          1,138
Income tax                                           1,207            852            605            468
                                               -----------    -----------    -----------    -----------
Net income                                     $     2,014    $     1,296    $     1,013    $       670
                                               ===========    ===========    ===========    ===========

Net income per common share
     Basic                                     $      0.51    $      0.33    $      0.26    $      0.17
                                               -----------    -----------    -----------    -----------
     Diluted                                   $      0.51    $      0.32    $      0.26    $      0.17
                                               -----------    -----------    -----------    -----------
Weighted average number of common shares
     Basic                                       3,920,318      3,910,589      3,921,686      3,917,521
                                               -----------    -----------    -----------    -----------
     Diluted                                     3,927,220      4,029,731      3,934,720      3,988,050
                                               -----------    -----------    -----------    -----------
</TABLE>

      See accompanying notes to condensed consolidated financial statements


                                                                               3
<PAGE>

                             FINANCIAL STATEMENTS OF
                           GENERAL BEARING CORPORATION
                                AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
                                 (In Thousands)

<TABLE>
<CAPTION>
                                                               Twenty-six weeks ended
                                                               ----------------------
                                                                 July 3,    June 27,
                                                                   1999       1998
                                                                 -------    -------
<S>                                                              <C>        <C>
Cash flows from operating activities:
        Net income                                               $ 2,014    $ 1,296
    Add (deduct) noncash items charged (credited) to income:
        Deferred income taxes                                      1,067        816
        Depreciation and amortization                                240        260
        Equity in income of affiliates                               (16)        --
        Loss / (gain) on disposal of fixed assets                      4       (295)
    Add (deduct) changes in operating assets and liabilities:
        Accounts receivable                                          332       (298)
        Inventories                                               (1,825)    (2,482)
        Prepaid expenses and other assets                           (245)       146
        Due to (from) affiliates                                    (454)       381
        Accounts payable and accrued expenses                        165         66
                                                                 -------    -------

           Net cash provided by (used in) operating activities       618       (110)
                                                                 -------    -------

Cash flows from investing activities:
    Investment in affiliates, net                                     --     (1,000)
    Fixed asset purchases                                           (306)      (864)
    Proceeds from sale of fixed assets                                --        604
                                                                 -------    -------

           Net cash used in investing activities:                   (306)    (1,260)
                                                                 -------    -------
Cash flows from financing activities:
    Proceeds from sale of common shares, net                          21        133
    Repayment of current maturity - bank                            (223)        --
    Repayment of long-term debt - bank                              (557)      (111)
    Increase in note payable - bank                                  497      1,989
    Repayment of long-term debt and other balances - parent          (65)      (644)
                                                                 -------    -------

         Net cash provided by (used in) financing activities        (327)     1,367
                                                                 -------    -------

Net decrease in cash                                                 (15)        (3)
Cash, beginning of period                                             29        118
                                                                 -------    -------
Cash, end of period                                              $    14    $   115
                                                                 =======    =======
Cash paid during the period for:
    Interest                                                     $   411    $   374
                                                                 =======    =======
    Income taxes                                                 $   141    $    36
                                                                 =======    =======
</TABLE>

      See accompanying notes to condensed consolidated financial statements


                                                                               4
<PAGE>

                           GENERAL BEARING CORPORATION
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of       The accompanying unaudited condensed consolidated financial
   Presentation   statements have been prepared in accordance with generally
                  accepted accounting principles for interim financial
                  information and with the instructions to Form 10-Q and
                  Regulation S-X. Accordingly, they do not include all of the
                  information and footnotes required by generally accepted
                  accounting principles for complete financial statements. In
                  the opinion of management, all adjustments (consisting solely
                  of normal recurring accruals) considered necessary for a fair
                  presentation have been included. Operating results for the
                  twenty-six weeks ended July 3, 1999 are not necessarily
                  indicative of the results that may be expected for the year
                  ending January 1, 2000. For further information, refer to the
                  consolidated financial statements and footnotes thereto
                  included in the Company's annual report on Form 10-K for the
                  year ended January 2, 1999.

2. Earnings       The calculation of diluted earnings per share includes the
   per Share      effect of outstanding options and warrants to the extent they
                  are dilutive.

3. Long Term      Due to favorable interest rates, the Company consolidated the
   Debt           remaining term loan balance ($669,000) into the existing
                  revolving credit facility during June 1999.

4. Litigation     Except as explained in Part II of this report, there has been
                  no material change in litigation since the events reported in
                  the Company's 10-K for the fiscal year ended January 2, 1999.
                  See Part II of this report for further disclosure.

5. Segment        During 1998, the Company adopted Statement of Financial
   Information    Accounting Standards No. 131 ("SFAS 131"), Disclosures about
                  Segments of an Enterprise and Related Information. SFAS 131
                  supersedes SFAS 14, Financial Reporting for Segments of a
                  Business Enterprise, replacing the "industry segment" approach
                  with the "management" approach. The management approach
                  designates the internal reporting that is used by management
                  for making operating decisions and assessing performance as
                  the source of the Company's reportable segments.

                  The Company operates in two divisions: the OEM Division, which
                  supplies Original Equipment Manufacturers (OEM's), and the
                  Distribution Division, which serves distributors that supply
                  the repair and maintenance aftermarket and small OEM's. The
                  two divisions supply principally in the United States.

                  The accounting policies of the segments are the same as those
                  described in the summary of significant accounting policies
                  outlined in the Company's 10-K for the fiscal year ended
                  January 2, 1999. The Company evaluates segment performance
                  based on operating income.

The following table presents information about the Company's business segments.


                                                                               5
<PAGE>

                           GENERAL BEARING CORPORATION
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                 (In Thousands)

<TABLE>
<CAPTION>
                                      Year to Date July 3, 1999
                                               OEM          DISTRIBUTOR      OTHER       TOTAL
                                      --------------------------------------------------------
<S>                                        <C>                   <C>        <C>        <C>
Net Sales from External Customers          $20,974               $7,185     $   --     $28,159
Gross Profit                                 4,833                3,864         --       8,697
Operating Income                             2,136                1,479         --       3,615
Depreciation / Amortization                    193                   47         --         240
Capital Expenditures                           193                   11        102         306
Total Assets                                19,335                7,369      5,504      32,208
                                      Year to Date June 27, 1998
                                               OEM          DISTRIBUTOR      OTHER       TOTAL
                                      --------------------------------------------------------
Net Sales from External Customers          $13,895               $7,453     $   --     $21,348
Gross Profit                                 3,037                3,821         --       6,858
Operating Income                               719                1,488         --       2,207
Depreciation / Amortization                    166                   94         --         260
Capital Expenditures                           734                   14        116         864
Total Assets                                14,003                8,131      7,252      29,386

                                      Quarter Ended July 3, 1999
                                               OEM          DISTRIBUTOR      OTHER       TOTAL
                                      --------------------------------------------------------
Net Sales from External Customers          $10,872               $3,565     $   --     $14,437
Gross Profit                                 2,379                1,979         --       4,358
Operating Income                             1,018                  789         --       1,807
Depreciation / Amortization                    112                    9         --         121
Capital Expenditures                           146                    1         65         212
Total Assets                                19,335                7,369      5,504      32,208

                                      Quarter Ended June 27, 1998
                                               OEM          DISTRIBUTOR      OTHER       TOTAL
                                      --------------------------------------------------------
Net Sales from External Customers           $7,433               $3,578     $   --     $11,011
Gross Profit                                 1,793                2,035         --       3,828
Operating Income                               465                  869         --       1,334
Depreciation / Amortization                     89                   38         --         127
Capital Expenditures                           337                   10         75         422
Total Assets                                14,003                8,131      7,252      29,386
</TABLE>

   Depreciation expense was allocated based on material, labor, and overhead.


                                                                               6
<PAGE>

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

Results of Operations

      Sales. Sales for the second fiscal quarter of 1999 were $14,437,000, an
increase of $3,426,000 or 31% compared to the same period in 1998. OEM sales
represented 75% of total sales for the second quarter of 1999 compared to 68% of
total sales for 1998. Second quarter sales in the OEM Division increased 46%
over 1998 while Distribution Division sales were virtually the same. On a
year-to-date basis, sales were $28,159,000, an increase of $6,811,000 or 32%
compared to the same period in 1998. OEM sales represented 74% and 65% of total
year-to-date sales for 1999 and 1998, respectively. OEM sales are ahead of the
prior period by 51% primarily as a result of new business won during 1998 and
1999. The largest dollar increase was in tapered roller bearings, where the
Company is a primary supplier to the heavy duty truck trailer market. Also
significant are increases in sales of ball bearings and new sales of a drive
line component to the automotive industry. Sales in the Distribution Division
are 4% lower in 1999 as softness in the industrial aftermarket offset higher
pricing.

      Gross Profit. Gross profit was $4,358,000 or 30.2% of sales in the second
fiscal quarter of 1999 compared to $3,828,000 or 34.8% of sales in the second
fiscal quarter in 1998. Gross profit percentage of sales (GP%) was adversely
impacted by product mix as a result of the growth in sales to original equipment
manufacturers combined with relatively constant higher margin sales to the
industrial aftermarket. GP% for the OEM Division was 21.9% in the second fiscal
quarter of 1999 compared to 24.1% in 1998. This is primarily due to product mix,
introductory pricing necessary to increase market share and costs associated
with the rectification of certain nonconforming components. GP% for the
Distribution Division was 55.5% in the second fiscal quarter of 1999 compared to
56.9% in 1998 due to product mix. On a year-to-date basis, gross profit was
$8,697,000 or 30.9% of sales in 1999 compared to $6,858,000 or 32.1% of sales in
1998. GP% for the OEM Division was 23.0% compared to 21.9% for 1998. The
increase is primarily due to the higher sales volume, partially offset by the
factors discussed above. GP% for the Distribution Division was 53.8% compared to
51.3% for 1998 mainly due to higher pricing.

      Selling, General and Administrative Expenses. Selling, general and
administrative expenses as a percentage of sales were 17.7% in the second fiscal
quarter of 1999 compared to 22.7% in the second fiscal quarter in 1998. This
reduction reflects the effect of the Company's increased sales volume. S,G&A
increased by $57,000. This is primarily attributable to increases in salaries
($151,000) to help support the Company's growth, partially offset by reduced
professional fees ($106,000). On a year-to-date basis, selling, general and
administrative expenses were 18.0% in 1999 compared to 21.8% in 1998, also
reflecting the effect of the Company's increased sales volume. Year-to-date
S,G&A increased $431,000 compared to 1998. The increase is mainly due to the
aforementioned increase in salaries ($287,000) as well as an increase in various
variable costs such as commissions ($68,000), freight to customers ($56,000),
and outside warehouse costs ($84,000), partially offset by lower professional
fees ($140,000).


                                                                               7
<PAGE>

      Operating Income. Operating income of $1,807,000 for the second fiscal
quarter of 1999 represents a 35% increase over the same period in 1998. An
increase in the OEM Division of 119% over 1998 to $1,018,000 was due primarily
to the sales and associated gross profit increases partially offset by increased
S,G&A needed to support its growth. Operating income in the Distribution
Division decreased 9% from 1998 to $789,000 mainly due to product mix. On a
year-to-date basis, operating income of $3,615,000 in 1999 represents a 64%
increase compared to 1998. The OEM Division year-to-date increase of 197% over
1998 to $2,136,000 is due to the factors mentioned above. The Distribution
Division year-to-date operating income is virtually the same as in 1998 where
higher pricing offset lower sales volume.

      Interest Expense, net. Net interest expense was $205,000 for the second
fiscal quarter of 1999 compared to $196,000 during the same period in 1998. As a
percentage of sales, net interest expense was 1.4% and 1.8% for the second
quarter of 1999 and 1998, respectively. This improvement reflects the higher
sales in 1999. On a year-to-date basis, net interest expense was $410,000 in
1999 compared to $354,000 in 1998. This increase is primarily due to higher bank
debt needed to fund inventory and receivables growth created by normal business
expansion.

      Income Tax. For the second fiscal quarter of 1999, the Company had an
effective tax rate of 37.4% compared to 41.1% for 1998. On a year-to-date basis,
the company had an effective tax rate of 37.5% compared to 39.7% in 1998.
Effective tax rates are based on estimated year end effective rates.

      Net Income. As a result of the factors discussed above, net income for the
second fiscal quarter of 1999 increased by 51% to $1,013,000 or $.26 per basic
and diluted share from $670,000 or $.17 per basic and diluted share in 1998. On
a year-to-date basis, net income increased by 55% to $2,014,000 or $.51 per
basic and diluted share from $1,296,000 or $.33 and $.32 per basic and diluted
share, respectively in 1998.

Financial Condition, Liquidity and Capital Resources

      The Company's primary sources of capital have been net cash provided by
operating activities, a term loan, sale of common stock and financing from
affiliates. Working capital requirements also have been financed by a Revolving
Credit Facility. The primary demands on the Company's capital resources have
been the need to fund inventory and receivables growth created in normal
business expansion. At January 2, 1999 and July 3, 1999, the Company had working
capital of $13,051,000 and $15,411,000, respectively.

      Cash provided by operating activities during the first six months of 1999
was $618,000. Cash provided from net income and deferred income taxes was
partially offset by increased inventory. The primary reasons for the inventory
increase are to support current and future increased sales volume in tapered
journal bearings, automotive ball bearings and truck size tapered roller
bearings.


                                                                               8
<PAGE>

      Cash used in investing activities during the first six months of 1999 was
$306,000 for capital expenditures.

      Cash used in financing activities during the first six months of 1999 was
$327,000. Net cash available from operating and investing activities was used to
pay down the note payable to the bank. Additionally, during June 1999, the
Company repaid its term loan via a transfer to the revolving credit facility due
to favorable interest rates and borrowing availability.

      At July 3, 1999, the Company had outstanding debt of $8,622,000 under its
Revolving Credit Facility and had further availability of approximately $4.0
million.

      The Company believes that funds generated from continuing operations,
capital lease financing and borrowing under the existing and any future
Revolving Credit Facilities will be sufficient to finance the Company's
anticipated working capital and capital expenditure requirements for at least
the next 24 months.

Year 2000 Compliance

      The "Year 2000" problem refers to and arises from deficient computer
programs and related products, such as embedded chips, which do not properly
recognize or process a year that begins with "20" instead of "19". If not
corrected, many computer applications could fail or create erroneous results.
The extent of the potential impact of the Year 2000 problem is not yet known,
and if not timely corrected, it could affect the global economy.

A. The Company's Readiness:

      1. (i) Information Technology (IT) systems: The Company has conducted a
comprehensive review of its computer systems to identify those that could be
affected by the Year 2000 issue. The Company's operating system and database
system are Year 2000 compliant. The Company presently believes that with minor
modifications (conversion and testing in progress) to existing software, the
Year 2000 problem will not pose significant operational problems for the
Company's computer systems. (ii) Non IT systems: Non IT systems are those which
typically include "embedded" technology such as microcontrollers and chips. The
Company currently is in the process of evaluating the effect of the Year 2000
problem on non IT systems and estimates compliance by August 31, 1999.

      2. Third Parties: Due to the pervasive use of computers by the Company in
its dealings with suppliers, customers, financial institutions, and other third
parties, the Year 2000 problem could have a material impact on the Company if
not timely addressed by such third parties. To assess third party readiness, the
Company has surveyed its principal suppliers and financial institutions and
received responses which indicate that all such parties have adequately
addressed the problem. While the company has not surveyed its customers, it has
received surveys from its principal customers which indicate that they are also
addressing the problem.


                                                                               9
<PAGE>

B. Cost: The Company has not allocated anticipated year 2000 remediation costs
among the various systems which may be affected but believes that total
remediation costs will be immaterial.

C. Risks: The Company believes that the greatest risk presented by the year 2000
problem is from third parties, such as suppliers, financial institutions,
utility providers, etc. who may not have adequately addressed the problem. A
failure of any such third party's computer or other applicable systems in
sufficient magnitude could materially and adversely affect the Company. The
Company is not presently able to quantify this risk but believes that it is
minimal based upon the surveys and letters it has received.

D. Contingency Plans: The Company had previously decided to devise a Year 2000
contingency plan. It is in the process of documenting the plan and estimates
completion by August 31, 1999. This plan will include detailed manual procedures
for every department should the Year 2000 problem cause an interruption in
computer services. Also, the Company will issue a comprehensive set of year-end
reports prior to January 1, 2000 to ensure that the necessary information is
available to conduct business in an uninterrupted fashion until any problems are
resolved. The procedures will include paper back up of the transactions executed
during downtime, if any, to enable the Company to transfer these transactions to
the computer system when it becomes available.

Inflation

      The effect of inflation on the Company has not been significant during the
last two fiscal years.

Quantitative and Qualitative Disclosure about Market Risk

Interest Rate Risk

      The Company's primary market risks are fluctuations in interest rates and
variability in interest rate spread relationships (i.e., prime to LIBOR spreads)
on its bank debt. The Company does not use derivative financial instruments.

      The Company's management believes that fluctuations in interest rates in
the near term would not materially affect the Company's consolidated operating
results, financial position or cash flows as the Company has limited risks
related to interest rate fluctuations.

Foreign Currency Risk

      The Company does not use foreign currency forward exchange contracts or
purchased currency options to hedge local currency cash flows or for trading
purposes. All sales arrangements with international customers are denominated in
U.S. dollars. Only a small fraction of the Company's purchases are denominated
in foreign currency. Due to this limited activity, the Company does not expect
any material loss with respect to foreign currency risk.


                                                                              10
<PAGE>

                                     PART II

Item 1. Legal Proceedings

The Timken Company vs. United States

      There have been no material developments in this matter subsequent to the
events reported in the Company's 10-K filed April 2, 1999.

Gussack Realty Company and General Bearing Corporation vs. Xerox

      In 1995 Gussack Realty Company ("Realty") and the Company filed an action
against Xerox in the Untied States District Court for the Southern District of
New York related to the discharge by Xerox of contaminants into the subsurface
at a property in the vicinity of property formerly leased by the Company and
owned by Realty in Blauvelt, New York ("Blauvelt Property"). Realty and the
Company, among other things, alleged that the subsurface discharge has adversely
affected the Blauvelt Property. In July, 1997, Xerox filed a counterclaim
against the Company and Realty, seeking contribution for Xerox's remediation
costs based upon Xerox's allegation of a discharge of contaminants into the
subsurface at the Blauvelt facility.

      On April 22, 1999, the jury in the above matter found in favor of Realty
and the Company and against Xerox on both the complaint and the counterclaim. On
May 28, 1999, the Court entered judgement in favor of Realty and the Company for
compensatory damages of $1,083,000 and sanctions of $27,897.70.

      On June 14, 1999, Xerox filed a motion for entry of a judgment in favor of
Xerox notwithstanding the verdict, pursuant to Rule 50(b) of the Federal Rules
of Civil Procedure, which the Court denied.

      On June 24, 1999, Realty and the Company filed an appeal with the United
States Court of Appeals for the Second Circuit (the "Appellate Court"),
challenging several rulings of the trial judge, including among other things,
his denial of prejudgment interest and refusal to allow the jury to consider
punitive damages.

      On July 23, 1999, Xerox filed a cross appeal.

      The Appellate Court has issued a scheduling order fixing deadlines for
submission of briefs and scheduling oral argument for "no earlier" than the week
of November 15, 1999.

      Since the events reported in the Company's 10Q filed May 18, 1999, there
have been no material developments in the previously disclosed proceeding in the
United States Bankruptcy Court for the Southern District of New York, seeking to
hold Xerox in Contempt and for sanctions on the ground that the above
counterclaim was discharged upon confirmation of the Company's Chapter 11
Reorganization Plan in 1993.


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<PAGE>

Item 5. Other Information

      Rule 14a-4 of the Securities and Exchange Commission's proxy rules allows
the Company to use discretionary voting authority to vote on matters coming
before an annual meeting of stockholders, if the Company does not have notice of
the matter at least 45 days before the date on which the Company first mailed
its proxy materials for the prior year's annual meeting of stockholders or the
date specified by an advance notice provision in the Company's By-laws. The
Company's By-laws contain such an advance notice provision. For the Company's
2000 Annual Meeting of Stockholders, stockholders must submit such written
notice to the Secretary of the Company no earlier than April 14, 2000 nor later
than May 19, 2000.

      This requirement is separate and apart from the Securities and Exchange
Commission's requirements that a stockholder must meet in order to have a
stockholder proposal included in the Company's proxy statement under Rule 14a-8.
For the Company's 2000 Annual Meeting of Stockholders, any stockholder who
wishes to submit a proposal for inclusion in the Company's proxy materials
pursuant to Rule 14a-8 must submit such proposal to the Secretary of the Company
no later than February 18, 2000.

Item 6. Exhibits and Reports on Form 8-K

      (a) Exhibit 27. Financial Data Schedule

      (b) The Registrant has not filed any reports on Form 8-K during the
quarter ended July 3, 1999.


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<PAGE>

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Quarterly Report on Form 10-Q to be signed on
its behalf by the undersigned, thereunto duly authorized.

Date: August 17, 1999.

GENERAL BEARING CORPORATION
(Registrant)


/s/ David L. Gussack
-----------------------
David L. Gussack
President


/s/ Barry A. Morris
-----------------------
Barry A. Morris
Chief Financial Officer


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