SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT

Pursuant to Section 13 or 15 (d) of
The Securities Exchange Act of 1934

For the Quarter Ended:
- ---------------------
March 31, 1999 Commission File Number: 0-18392
-------
Ameriana Bancorp
----------------

Indiana 35-1782688
- ------------------------------- ---------------------
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)

2118 Bundy Avenue, New Castle, Indiana 47362-1048
- -------------------------------------- ----------
(Address of principal executive offices (Zip Code)

Registrant's telephone number, including area code (765)529-2230
-------------

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

Common Stock, par value $1.00 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. YES XX NO ___

As of May 7, 1999, there were issued and outstanding
3,424,768 shares of the registrant's common stock.

AMERIANA BANCORP AND SUBSIDIARIES

CONTENTS

PART I - FINANCIAL INFORMATION Page No.
--------
ITEM 1 - Financial Statements

Consolidated Statements of Condition as of
March 31, 1999 and December 31, 1998 . . . . . . . 3

Consolidated Statements of Income for the
Three Months March 31, 1999 and 1998 . . . . . . . 4

Consolidated Statements of Cash Flows for
the Three Months Ended March 31, 1999
and 1998. . . . . . . . . . . . . . . . . . . . . 5

Notes to Consolidated Financial Statements . . . . 6

ITEM 2 - Management's Discussion and Analysis
of Financial Condition and Results
of Operations . . . . . . . . . . . . . . . 7

ITEM 3 - Quantitative and Qualitative
Disclosures About Market Risk. . . . . . . . 9

PART II - OTHER INFORMATION . . . . . . . . . . . . . .12

SIGNATURES. . .. . . . . . . . . . . . . . . . . . . . .14

AMERIANA BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CONDITION

March 31, December 31,
1999 1998
------------ -----------
ASSETS

Cash on hand and in other institutions $ 6,818,169 $ 7,545,308
Interest-bearing demand deposits 22,980,363 38,005,929
Investment-bearing time deposits 4,686,000 3,487,000
Investment securities held to maturity (fair
value of $70,864,000 and $51,512,000) 71,551,948 51,581,077
Mortgage-backed securities held to maturity
(fair value of $18,794,000 and $20,437,000) 18,580,042 20,217,346
Mortgage loans held for sale 2,079,225 4,181,256
Loans receivable 257,647,820 263,097,420
Allowance for loan losses (1,309,850) (1,284,286)
------------ ------------
Net loans receivable 256,337,970 261,813,134
Real estate owned 103,946 96,408
Premises and equipment 6,027,020 6,091,944
Stock in Federal Home Loan Bank 3,608,100 3,587,700
Mortgage servicing rights 1,107,926 1,076,948
Investments in unconsolidated subsidiaries 1,375,705 1,424,455
Intangible assets 1,995,535 2,057,464
Other assets 7,929,494 4,552,194
------------ ------------
Total assets $405,181,443 $405,718,163
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities:
Deposits:
Noninterest-bearing $ 13,595,946 $ 14,633,031
Interest-bearing 318,456,938 319,356,272
------------ ------------
Total deposits 332,052,884 333,989,303
Advances from Federal Home Loan Bank 18,614,050 17,100,699
Drafts payable 2,360,207 4,353,792
Advances by borrowers for taxes and insurance 1,082,838 1,030,976
Other liabilities 6,235,385 3,894,245
------------ ------------
Total liabilities 360,345,364 360,369,015

Shareholders' Equity:
Preferred stock (5,000,000 shares
authorized; none issued) -- --
Common stock ($1.00 par value; authorized
15,000,000 shares; issued shares:
1999 - 3,462,986; 1998 - 3,510,686) 3,462,986 3,510,686
Additional paid-in capital 6,033,047 6,775,114
Retained earnings 35,340,046 35,063,348
------------ ------------
Total shareholders' equity 44,836,079 45,349,148
------------ ------------
Total liabilities and shareholders'
equity $405,181,443 $405,718,163
============ ============

See accompanying notes.

AMERIANA BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME

Three Month Ended
March 31,
---------------------
1999 1998
------- -------

Interest Income:
Interest on loans $5,138,081 $ 5,793,998
Interest on mortgage-backed securities 304,432 498,759
Interest on investment securities 977,470 493,798
Other interest and dividend income 467,009 266,079
---------- -----------
Total interest income 6,886,992 7,052,634

Interest Expense:
Interest on deposits 3,608,565 3,834,762
Interest on Federal Home Loan Bank
advances 225,848 172,114
---------- -----------
Total interest expense 3,834,413 4,006,876
---------- -----------
Net interest income 3,052,579 3,045,758

Provision For Loan Losses 37,500 36,000
---------- -----------
Net interest income after provision
for loan losses 3,015,079 3,009,758

Other Income:
Net loan servicing fees 56,352 45,358
Other fees and service charges 219,694 178,259
Brokerage and insurance commissions 347,254 345,953
Loss on investments in unconsolidated
affiliates (48,750) (55,000)
Gains on sales of loans 162,449 268,047
Other 43,109 42,858
---------- -----------
Total other income 780,108 825,475

Other Expense:
Salaries and employee benefits 1,449,606 1,256,488
Net occupancy expense 363,292 320,028
Federal insurance premium 46,560 50,840
Data processing expense 80,061 76,238
Printing and office supplies 103,502 71,147
Goodwill 47,235 16,955
Other 493,130 477,955
---------- -----------
Total other expense 2,583,386 2,269,651
---------- -----------
Income before income taxes 1,211,801 1,565,582

Income Taxes 414,395 536,663
---------- -----------
Net Income $ 797,406 $ 1,028,919
========== ===========
Basic Earnings Per Share $ 0.23 $ 0.29
========== ===========
Diluted Earnings Per Share $ 0.23 $ 0.28
========== ===========
Dividends Declared Per Share $ 0.150 $ 0.145
========== ===========

See accompanying notes.

AMERIANA BANCORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended
March 31
-----------------
1999 1998
---- ----

OPERATING ACTIVITIES
Net income $ 797,406 $ 1,028,919
Adjustments to reconcile net income to net cash
provided by operating activities:
Provision for losses on loans and real estate
owned 37,500 36,000
Depreciation and amortization 157,531 150,418
Equity in loss of limited partnership 48,750 55,000
Mortgage servicing rights amortization 63,682 45,957
Goodwill amortization 47,235 16,955
Deferred income taxes (2,615) 14,620
Gains on sales of real estate owned -- (2,651)
Mortgage loans originated for sale (11,265,314) (26,316,496)
Proceeds from sales of loans 13,435,134 25,652,918
Gain on sales of loans and servicing rights (162,449) (268,047)
Increase in other assets (3,362,606) (46,047)
Decrease in drafts payable (1,993,585) (1,809,978)
Increase in other liabilities 2,404,701 482,797
----------- -----------
Net cash provided (used) by operating
activities 205,370 (959,635)

INVESTING ACTIVITIES
Purchase of interest-bearing time deposits (1,199,000) --
Purchase of investment securities held to
maturity (26,958,406) (22,385,126)
Proceeds from maturity of securities held
to maturity -- 5,000,000
Proceeds from calls of securities held to
maturity 6,992,969 16,700,000
Principal collected on mortgage-backed securities
held to maturity 1,607,783 2,115,189
Net change in loans 5,413,604 14,527,765
Proceeds from sale of real estate owned 20,000 71,823
Net purchases of premises and equipment (68,877) (39,533)
Cash received in acquisition -- 11,345,702
Other investing activities (23,521) (7,232)
----------- -----------
Net cash provided (used) by investing
activities (14,215,448) 27,328,588

FINANCING ACTIVITIES
Net change in demand and passbook deposits 4,642,216 6,074,234)
Net change in certificates of deposit (6,578,635) (19,315,832)
Advances from Federal Home Loan Bank 2,000,000 4,000,000
Repayment of Federal Home Loan Bank advances (486,649) (4,993,918)
Proceeds from exercise of stock options 17,759 265,532
Purchase of common stock (807,526) --
Cash dividends paid (529,792) (517,265)
----------- -----------
Net cash used by financing activities (1,742,627) (14,487,249)
----------- -----------

Increase (decrease) in cash and cash equivalents (15,752,705) 11,881,704

Cash and cash equivalents at beginning of year 45,551,237 15,209,080
----------- -----------
Cash and cash equivalents at end of period $29,798,532 $27,090,784
=========== ===========
Supplemental information:
Interest paid $ 3,694,745 $ 2,133,582
Income taxes paid 100,000 150,000

See accompanying notes.
5

AMERIANA BANCORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
- ------------------------------------------
NOTE A -- BASIS OF PRESENTATION

The unaudited interim consolidated financial statements have
been prepared in accordance with the instructions to Form 10-Q
and, therefore, do not include all information and disclosures
required by generally accepted accounting principles for
complete financial statements. In the opinion of management,
the financial statements reflect all adjustments (comprised only
of normal recurring adjustments and accruals) necessary to
present fairly the Company's financial position as of March 31,
1999, and the results of operations and changes in cash flows
for the three-month periods ended March 31, 1999 and 1998. A
summary of the Company's significant accounting policies is set
forth in Note 1 of Notes to Consolidated Financial Statements in
the Company's annual report on Form 10-K for the year ended
December 31, 1998.

NOTE B - - SHAREHOLDERS' EQUITY

On February 22, 1999, the Board of Directors declared a
quarterly cash dividend of $.15 per share. This dividend,
totaling $520,708, was accrued for payment to shareholders of
record on March 12, 1999, and was paid on April 2, 1999.

During the quarter ended March 31, 1999, 1,540 new shares were
issued from exercise of stock options and total equity was
increased by $17,759 due to cash proceeds and tax benefits from
these stock option exercises.

The Company repurchased 49,240 shares of its common stock on the
market during the first quarter of 1999 for a total of $807,526.
The price of stock repurchased ranged from $16.125 to $17.00 per
share.

Earnings per share were computed as follows:

Three Months Ended March 31,
----------------------------------
1999 1998
- ------------------------------------------------------------------------------------------
Weighted Per Weighted Per
Average Share Average Share
Income Shares Amount Income Shares Amount
- ------------------------------------------------------------------------------------------

Basic Earnings Per Share:
Income available to
common shareholders $797,406 3,490,638 $.23 $1,028,919 3,567,061 $.29
Effect of Dilutive Stock Options -- 33,509 -- 59,053
- ------------------------------------------------------------------------------------------
Diluted Earnings Per Share:
Income available to
common shareholders and
assumed conversions $797,406 3,524,147 $.23 $1,028,919 3,626,114 $.28
- ------------------------------------------------------------------------------------------

NOTE C - - RECLASSIFICATIONS

Certain reclassifications of 1998 amounts have been made to
conform to the 1999 presentation.

AMERIANA BANCORP AND SUBSIDIARIES

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

General
- -------

This Quarterly Report on Form 10-Q ("Form Q") may contain
statements which constitute forward looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. These statements appear in a number of places in this
Form 10-Q and include statements regarding the intent, belief,
outlook, estimate or expectations of the Company primarily with
respect to future events and future financial performance.
Readers of this Form 10-Q are cautioned that any such forward
looking statements are not guarantees of future events or
performance and involve risks and uncertainties, and that actual
results may differ materially from those in the forward looking
statements as a result of various factors. The accompanying
information contained in this Form 10-Q identifies important
factors that could cause such differences. These factors
include changes in interest rates; loss of deposits and loan
demand to other financial institutions; substantial changes in
financial markets; changes in real estate values and the real
estate market or regulatory changes.

The largest components of the Company's total revenue and total
expenses are interest income and interest expense, respectively.
Consequently, the Company's earnings are primarily dependent on
its net interest income, which is determined by (i) the
difference between rates of interest earned on interest-earning
assets and rates paid on interest-bearing liabilities ("interest
rate spread"), and (ii) the relative amounts of interest-earning
assets and interest-bearing liabilities. Levels of other income
and operating expenses also significantly affect net income.

Management believes that interest rate risk, i. e., the
sensitivity of income and net asset values to changes in
interest rates, is one of the most significant determinants of
the Company's ability to generate future earnings. Accordingly,
the Company has implemented a long-range plan intended to
minimize the effect of changes in interest rates on operations.
The asset and liability management policies of the Company are
designed to stabilize long-term net interest income by managing
the repricing terms, rates an relative amounts of
interest-earning assets and interest-bearing liabilities.

RESULTS OF OPERATIONS
- ---------------------

During the first quarter of 1999, the Company was compelled by
low fixed rate mortgage rates to make fixed rate loans and sell
them to the secondary market. The past theory of emphasizing
variable rate mortgage loans and keeping them in the portfolio
could not be continued because consumers were satisfied with the
low fixed rates. The loans outstanding decreased $5,449,600 and
2.07% to $257,647,820 during the quarter from $263,097,420 at
December 31, 1998. This decrease is due to loan volume being
down, to not retaining new loans made and selling them to the
secondary market and to refinancing of existing loans in the
portfolio, which were also sold to the secondary market. The
mortgage loans held for sale decreased to $2,079,225 at March
31, 1999, from $4,181,256 at December 31, 1998, but these are
loans that have been committed to be sold to the secondary
market but had not been delivered as of the end of the period.

Sales of loans to the secondary market significantly decreased
to $13,435,134 during the first quarter of 1999 compared to
$25,652,918 during the first quarter of 1998. This is only
52.37% of the 1998 volume of loans sold and had a significant
effect on the gain on sale of loans. See comments on other
income for detail of gains on loans sold.

The net interest spread (difference between yield on
interest-earning assets and cost on interest-bearing
liabilities) has increased during the first quarter of 1999
compared to the first quarter 1998, because the interest yield
reduction of .37% on interest-earning

average assets is more than offset by the .42% reduction in cost
on interest-bearing average liabilities. This reduction of the
cost of liabilities has resulted from decreased rates on the
Federal Home Loan Bank borrowings and deposit costs during the
first quarter of 1999 compared to first quarter 1998.

The following table summarizes the Company's average net
interest-earning assets and interest-bearing liabilities with
the accompanying average rates for the first quarter of 1999 and
1998:

(Dollars in Thousands)
---------------------------
Three Months Ended March 31,
---------------------------
1999 1998
---- ----

Interest-earning assets $382,646 $372,538
Interest-bearing liabilities 336,794 322,153
-------- --------

Net interest-earning assets $ 45,852 $ 50,385
-------- --------

Average yield on:
Interest-earning assets 7.30% 7.67%
Interest-bearing liabilities 4.62 5.04
---- ----
Net interest spread 2.68% 2.63%
---- ----

Net interest income for the first quarter 1999 was $3,052,579
and was $6,821 and .22% more than $3,045,758 during the first
quarter of 1998. This increase is due to lower interest income
being more than offset by lower interest expense. The $166,000
decrease in interest income on assets is a combination of a
decrease of $24,000 because of the volume mix of average
outstanding interest-bearing assets plus $142,000 because of
reduced rates on average interest-earning assets. The reduction
of $24,000 from lower average outstanding balances is a
combination of a $670,000 volume decrease in outstanding loans
and mortgage-backed securities (which earn a higher rate of
return) offset by a $646,000 increase in outstanding other
interest-earning assets (which earn a lower rate of return).
Total average interest-earning assets increased in first quarter
1999 compared to first quarter 1998, but the average balance of
the higher earning assets decreased while the average balance of
the lower earning assets increased, thus providing a decrease in
yield due to outstanding interest-earning balances. The
$142,000 decrease due to rate is down by $180,000 due to rate
decreases on outstanding loans and mortgage-backed securities
offset by a $38,000 increase due to higher rates on other
interest-earning assets. The $173,000 decrease in interest
expense is a combination of an increase of $184,000 because of
higher average interest-bearing liabilities offset by a $357,000
reduction in costs due to lower rates on interest-bearing
liabilities. The net interest margin ratio, which is net income
divided by average earning assets, decreased to 3.24% for the
first quarter 1999 compared to 3.32% for the first quarter of
1998.

The provision for loan losses was $37,500 during 1999 and was up
slightly from $36,000 during 1998. Net charge-offs were $13,000
and $37,000 for 1999 and 1998 first quarters, respectively. The
following table summarizes the Company's non-performing assets
at:

(Dollars in Thousands)
----------------------
March 31, December 31, March 31,
1999 1998 1998
---- ---- ----

Loans:
Non-accrual $ 867 $ 745 $ 497
Over 90 days delinquent 585 40 91
Troubled debt restructured 917 914 1,028
Real estate owned 104 96 195
------ ------ ------
Total $2,473 $1,795 $1,811
------ ------ ------

Management believes the allowance for loan losses is adequate
and that sufficient provision has been provided to absorb any
losses, which may ultimately be incurred on non-performing loans
and the remainder of the portfolio. The allowance for loan
losses

as a percentage of loans at the end of the period was .51%, .49%
and .42% at March 31, 1999, December 31, 1998 and March 31,
1998, respectively.

Total other income for the first quarter 1999 decreased $45,367
and 5.50% to $780,108 from $825,475 in the same period during
1998. As noted earlier, gains on sales of loans to the
secondary market were reduced in 1999 and the gain on sales was
$105,598 lower in 1999 than in 1998. This reduction was offset
by gains in net loan servicing fees, other fees and service
charges, brokerage and insurance commissions and loss on
investment in unconsolidated affiliates of $10,994, $41,435,
$1,301 and $6,250, respectively.

Total other expense increased $313,735 and 13.82% in 1999 to
$2,583,386 from $2,269,651 during 1998. The majority of these
expense increases are due to operating three more branches for
two months in 1999 than in 1998 and operating two more branches
for one month in 1999 than in 1998. The increase in goodwill
expense indicates the existence of new purchased branches in
1999 compared to 1998.

FINANCIAL CONDITION
- -------------------

The Company's principal sources of funds are cash generated from
operations, deposits, loan principal repayments and advances
from the Federal Home Loan Bank ("FHLB"). As of March 31, 1999,
the Company's cash and interest-bearing time deposits totaled
$29,798,532 and 7.35% of total assets. This compares with
$45,551,237 and 11.23% of total assets at December 31, 1998.
The Company's banking subsidiaries, Ameriana Bank of Indiana
("ABI") and Ameriana Bank of Ohio ("ABO") have regulatory
liquidity ratios of 30.79% and 23.35%, respectively, which
exceeds the 4.0% liquidity base set by the Office of Thrift
Supervision ("OTS").

ABO currently employs a strategy to increase interest income
through the purchase of investments with the proceeds of
advances from the FHLB. All FHLB borrowings are currently
borrowed by ABO, and have increased $1,513,351 and 8.85% to
$18,614,050 during the first quarter of 1999 from $17,100,699 at
December 31, 1998. The increased borrowings have been
arbitraged by investing in interest-bearing time deposits which
are one year investments at other financial institutions. These
investments are all $100,000 or less and are FDIC insured.

The regulatory minimum net worth requirement for ABI and ABO
under the most stringent of the three capital regulations (total
risk-based capital to risk-weighted assets) at March 31, 1999,
was $12,785,000 and $3,524,000, respectively. At March 31,
1999, ABI had total risk based capital of $33,795,000 and ABO
had $8,231,000.

At March 31, 1999, the Company's commitments for loans in
process totaled $12,590,000, with 96% being for real estate
secured loans. Management believes the Company's liquidity and
other sources of funds will be sufficient to fund all
outstanding commitments and other cash needs.

ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT INTEREST
RATE RISK

INTEREST RATE RISK
- ------------------

ABI and ABO are subject to interest rate risk to the degree that
their interest-bearing liabilities, primarily deposits, mature
or reprice at different rates than their interest-earning
assets. Although having liabilities that mature or reprice less
frequently on average than assets will be beneficial in times of
rising interest rates, such an asset/liability structure will
result in lower net income during periods of declining interest
rates, unless offset by other factors.

It is important to ABI and ABO to manage the relationship
between interest rates and the effect on their net portfolio
value ("NPV"). This approach calculates the difference between
the present value of expected cash flows from assets and the
present value of

expected cash flows from liabilities, as well as cash flows from
off-balance sheet contracts. Assets and liabilities are managed
within the context of the marketplace, regulatory limitations
and within its limits on the amount of change in NPV, which is
acceptable given certain interest rate changes.

The Office of Thrift Supervision ("OTS") issued a regulation,
which uses a net market value methodology to measure the
interest rate risk exposure of savings associations. Under this
OTS regulation an institution's "normal" level of interest rate
risk in the event of an assumed change in interest rates is a
decrease in the institution's NPV in an amount not exceeding 2%
of the present value of its assets. Savings associations with
over $300 million in assets or less than a 12% risk-based
capital ratio are required to file OTS Schedule CMR. Data from
Schedule CMR is used by the OTS to calculate changes in NPV (and
the related "normal" level of interest rate risk) based upon
certain interest rate changes (discussed below). Associations
which do not meet either of the filing requirements are not
required to file OTS Schedule CMR, but may do so voluntarily.
ABI, with assets over $300 million, is required to file the
schedule. As ABO does not meet either of these requirements, it
is not required to file Schedule CMR, although it does so
voluntarily. Under the regulation, associations which must file
are required to take a deduction (the interest rate risk capital
component) from their total capital available to calculate their
risk based capital requirement if their interest rate exposure
is greater than "normal". The amount of that deduction is
one-half of the difference between (a) the institution's actual
calculated exposure to a 200 basis point interest rate increase
or decrease (whichever results in the greater pro forma decrease
in NPV) and (b) its "normal" level of exposure which is 2% of
the present value of its assets on the Thrift Financial Report
filed two quarters earlier.

The following information and schedule for ABO and the
subsequent information and schedule for ABI are required to be
presented. The current analysis for ABO and ABI performed by
the OTS as of March 31, 1999, has not been received from the OTS
and the following interest rate risk measurements for ABO and
the subsequent rate risk measurements for ABI are being
submitted with information from the OTS analysis as of December
31, 1998. Management believes there has been no significant
change in the interest rate risk measures since December 31,
1998, for either ABO or ABI.

Presented below, as of December 31, 1998, is an analysis
performed by the OTS of ABO's interest rate risk as measured by
changes in NPV for instantaneous and sustained parallel shifts
in the yield curve, in 100 basis point increments, up and down
400 basis points. At June 30, 1998, 2% of the present value of
ABO's assets was $1.535 million. Because the interest rate risk
of a 200 basis point decrease in market rates (which was greater
than the interest rate risk of a 200 basis point increase) was
$1.113 million at December 31, 1998, ABO would not have been
required to make a capital deduction.

- ----------------------------------------------------------------------------------------
NPV as Percent of
Net Portfolio Value Present Value of Assets
- ----------------------------------------------------------------------------------------
Change Dollar Dollar Percent
In Rates Amount Change Change NPV Ratio Change
- ----------------------------------------------------------------------------------------
(Dollars in thousands)
- ----------------------------------------------------------------------------------------

+400 bp* $ 9,781 $ -628 - 6% 11.07% - 8 bp
+300 bp 10,397 -12 0% 11.56% +41 bp
+200 bp 10,781 371 + 4% 11.79% +64 bp
+100 bp 10,805 395 + 4% 11.67% +52 bp
0 bp 10,409 11.15%
- -100 bp 9,793 -616 - 6% 10.42% -73 bp
- -200 bp 9,296 -1,113 -11% 9.80% -135 bp
- -300 bp 9,080 -1,330 -13% 9.46% -169 bp
- -400 bp 8,813 -1,596 -15% 9.07% -208 bp
* basis points

Also presented below, as of December 31, 1998, is an analysis,
performed by the OTS, of ABI's interest rate risk as measured by
changes in NPV for instantaneous and sustained parallel shifts
in the yield curve, in 100 basis point increments, up and down
400 basis points. At June 30, 1998, 2% of the present value of
ABI's assets was $6.113 million. Because the interest rate risk
of a 200 basis point increase in market rates (which was greater
than the interest rate risk of a 200 basis point decrease) was
$7.620 million at December 31, 1998, ABI would have been
required to make a $754 thousand deduction from its total
capital available to calculate its risk based capital
requirement. This reduction in capital would reduce ABO's
risk-based capital ratio to 21.5% from 22.0%, which is still far
in excess of the required risk-based capital ratio of 8.0%.

+400 bp* $27,724 $-16,888 -38% 9.23% -447 bp
+300 bp 32,548 -12,063 -27% 10.59% -311 bp
+200 bp 36,992 -7,620 -17% 11.79% -191 bp
+100 bp 40,952 -3,659 -8% 12.80% - 90 bp
0 bp 44,612 13.70%
- -100 bp 45,743 2,982 +7% 13.82% + 92 bp
- -200 bp 53,040 8,429 +19% 15.67% +197 bp
- -300 bp 58,640 14,029 +31% 16.93% +323 bp
- -400 bp 64,241 19,629 +44% 18.12% +442 bp

* basis points

As with any method of measuring interest rate risk, certain
shortcomings are inherent in the methods of analysis presented
above. For example, although certain assets and liabilities may
have similar maturities or periods to repricing, they may react
in different degrees to changes in market interest rates. Also,
the interest rates on certain types of assets and liabilities
may fluctuate in advance of changes in market interest rates,
while interest rates on other types may lag behind changes in
market rates. Additionally, certain assets, such as
adjustable-rate loans, have features, which restrict changes in
interest rates on a short-term basis and over the life of the
asset. Further, in the event of a change in interest rates,
expected rates of prepayments on loans and early withdrawals
from certificates could likely deviate significantly from those
assumed in calculating the table. Finally, the ability of many
borrowers to service their debt may decrease in the event of an
interest rate increase. The Company considers all of these
factors in monitoring its exposure to interest rate risk.

SUBSEQUENT EVENT
- ----------------

On April 29, 1999, the Board of Directors agreed to expand the
Company's repurchase of its common stock by an additional $5
million. This is an increase to the already approved $5 million
for repurchase of common stock that was announced in July 1998.

YEAR 2000 ISSUE
- ---------------

The Company is aware of the issues associated with the
programming code in existing computer systems as the millennium
("Year 2000") approaches. The Year 2000 problem is pervasive
and complex as virtually every computer operation and any
equipment with computer chips may be affected in some way by the
rollover of the two-digit year value to 00. The issue is
whether computer systems and computer chips will properly
recognize
11

date-sensitive information when the year changes to 2000.
Computer chips that do not properly recognize such information
could generate erroneous data or cause a system to fail. The
Company has developed an extensive Year 2000 Compliance Plan.
The Company has completed the assessment process of all its
business processes to make a determination of areas that could
be affected by the Year 2000 problem. The review included all
hardware, software and any interaction with third party vendors.
To date, all systems have been remediated. The Company is in
the process of testing all on-site hardware and software. In
addition, the Company will be testing the interfaces and
communications with those third party vendors with which it
conducts business through automated or computerized processes.
The Company expects to complete all testing of all identified
areas during the second quarter of 1999.

The Company believes that its assessment, remediation and
testing of all of its hardware, software and processes have
adequately addressed all Year 2000 issues. The Company has,
however, developed, and will continue to modify, a Business
Resumption Plan ("Plan"). The Plan attempts to anticipate all
scenarios of failure, either in our own systems or the failure
of an organization on which the Company is dependent for
services. The Plan creates alternate plans to conduct business
in the event of any system failure.

The Company has committed a great deal of management time in
creating and implementing its Year 2000 Compliance Plan. To date
the Company has not incurred a significant amount of external
costs in the remediation and replacement of existing systems and
did not track internal personnel costs associated with the Year
2000 work. Management believes that expenses associated with
the Year 2000 compliance have not, nor are they expected to
have, a material impact on the Company's net income.

OTHER
- -----

The Securities and Exchange Commission ("SEC") maintains
reports, proxy information, statements and other information
regarding registrants that file electronically with the SEC,
including the Company. The address is (http://www.sec.gov).

PART II - OTHER INFORMATION

ITEM 1 - Legal Proceedings
-----------------

No changes have taken place in regard to the legal
proceedings disclosed in the registrant's report
on Form 10-K for the year ended December 31, 1998.

ITEM 2 - Changes in Securities
---------------------

Not Applicable

ITEM 3 - Defaults in Senior Securities
-----------------------------

Not Applicable

ITEM 4 - Submission of Matters to a Vote of Security
-------------------------------------------
Holder
------

Not Applicable

ITEM 5 - Other Information
-----------------

Not Applicable

ITEM 6 - Exhibits and Reports on Form 8-K
--------------------------------

Not Applicable

SIGNATURES

AMERIANA BANCORP AND SUBSIDIARIES

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.

AMERIANA BANCORP

DATE: May 7, 1999 /s/ Harry J. Bailey
----------- -------------------
Harry J. Bailey
President and
Chief Executive Officer
(Duly Authorized Representative)

DATE: May 7, 1999 /s/ Richard E. Welling
------------ ----------------------
Richard E. Welling
Senior Vice President-
Treasurer
(Principal Financial Officer
and Accounting Officer)