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

                                    Form 10-Q


                  X QUARTERLY REPORT PURSUANT TO SECTION 13 OR
                  15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

     For the Quarter Ended                    Commission File Number
        March 31, 1999                                1-8319





                            GATX CAPITAL CORPORATION


      Incorporated in the                 IRS Employer Identification Number
       State of Delaware                               94-1661392

                             Four Embarcadero Center
                             San Francisco, CA 94111
                                 (415) 955-3200



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  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

                                  Yes X  No __
                                               


All Common Stock of Registrant is held by GATX Financial Services, Inc.
   (a wholly-owned subsidiary of GATX Corporation).

As of May 10, 1999, Registrant has outstanding 1,031,250 shares of $1 par value
Common Stock.

THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a) AND
(b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED DISCLOSURE
FORMAT.




                                      
<PAGE>
                                   
PART I.  FINANCIAL INFORMATION
Item 1.  Financial Statements

GATX CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME 
(unaudited, in thousands)


                                                    Three Months Ended
                                                         March 31,
                                                     1999         1998
                                                 ---------    ---------
                                                        (Unaudited)
REVENUES:

Lease income                                      $  72,744    $  69,307
Technology equipment sales and service               36,748       34,374
Gain on sale of assets                               18,132       25,040
Equity earnings from investment in 
  joint ventures                                     13,448       10,355
Interest                                              8,380        7,170
Fees                                                  8,788        9,076
Other                                                 5,804        2,514
                                               ------------  -----------
                                                    164,044      157,836
                                               ------------  -----------

EXPENSES:

Operating leases                                     39,548       32,999
Cost of technology equipment sales and service       31,477       27,274
Selling, general & administrative                    29,771       27,716
Interest                                             28,526       29,869
Provision for losses on investments                   2,749        2,250
Other                                                 1,151          726
                                               ------------  -----------
                                                    133,222      120,834
                                               ------------  -----------

Income before income taxes                           30,822       37,002
                                               
Provision for income taxes                           12,877       15,437
                                               ------------  -----------

NET INCOME                                        $  17,945    $  21,565
                                               ============  ===========






                                       1
<PAGE>
GATX CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands)
                                                   March 31,  December 31,
                                                     1999          1998
                                                  ----------  ------------
                                                  (Unaudited)
ASSETS:
Cash and cash equivalents                        $   69,288    $  67,975 
Investments:
   Direct financing leases                          523,608      537,897 
   Leveraged leases                                 138,102      133,380 
   Operating lease equipment-
        net of depreciation                         560,551      547,221 
   Secured loans                                    273,347      241,567 
   Investment in joint ventures                     594,625      570,255 
   Assets held for sale or lease                     33,290       26,286
   Other investments                                 78,575       84,856
   Investment in future residuals                    17,370       18,706
   Allowance for losses on investments             (132,005)    (129,278)  
                                                ------------ ------------
          Net investments                         2,087,463    2,030,890
                                                ------------ ------------

Due from Parent                                      33,817       37,816
Other assets                                        130,832      139,001 
                                               ------------- ------------
TOTAL ASSETS                                    $ 2,321,400  $ 2,275,682
                                               ============= ============

LIABILITIES AND STOCKHOLDER'S EQUITY:
Accrued interest                                $    27,228  $    13,634
Accounts payable and other liabilities              112,945      150,504
Debt financing:
   Commercial paper and bankers' acceptances        118,300      128,329 
   Notes payable                                     31,043       25,847
   Obligations under capital leases                   8,730        8,781
   Senior term notes                              1,146,600    1,076,600
                                               -------------  -----------
          Total debt financing                    1,304,673    1,239,557  
                                               -------------  -----------
Nonrecourse obligations                             362,760      381,390
Deferred income                                      18,683        9,702
Deferred income taxes                                89,535       83,754

Stockholder's equity:
   Convertible preferred stock, par value $1,       125,000      125,000
      and additional paid-in capital
   Common stock, par value $1, and
     additional paid-in capital                      28,960       28,960
   Accumulated other comprehensive income              (238)         772
   Reinvested earnings                              251,854      242,409
                                               -------------  -----------
          Total stockholder's equity                405,576      397,141  
                                               -------------  -----------
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY     $  2,321,400  $ 2,275,682
                                               =============  ===========

                                       2
<PAGE>
GATX CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)
                                                    Three Months Ended
                                                        March 31,
                                                       1999       1998
                                                  ----------  --------- 
                                                        (Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:

Net income                                        $  17,945    $ 21,565
Reconciliation of net income to net cash flows 
 provided by operating activities:
   Provision for losses on investments                2,749       2,250
   Depreciation and amortization expense             29,932      24,094
   Provision for deferred income taxes                7,729       8,129
   Gain on sale of assets                           (18,132)    (25,040)
   Joint venture income, net of cash dividends       (8,100)     (6,197)    
   Changes in assets and liabilities:
      Other assets                                    6,512      24,837 
      Due from Parent                                 3,999       5,679
      Accrued interest, accounts payable and        (23,965)    (37,929)
          other liabilities
      Deferred income                                 8,981      (4,893)
      Other - net                                     9,371      (2,378)
                                                ------------ -----------
Net cash flows provided by operating activities      37,021      10,117
                                                ------------ -----------

CASH FLOWS FROM INVESTING ACTIVITIES:

Investments in leased equipment, net of
 nonrecourse borrowings for leveraged leases        (88,643)    (71,009)
Loans extended to borrowers                         (74,638)    (28,741)
Other investments                                   (51,793)    (18,588)
                                                ------------ -----------
   Total investments                               (215,074)   (118,338)
                                                ------------ -----------
Lease rents received, net of earned income and
 leveraged lease nonrecourse debt service            54,070      36,477
Loan principal received                              13,529      10,275
Proceeds from sale of assets                         71,880     100,376
Joint venture investment recovery                     1,901      16,250        
                                               ------------- -----------
   Recovery of investments                          141,380     163,378
                                               ------------- -----------
Net cash flows (used in) provided by 
 investing activities                               (73,694)     45,040
                                               ------------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from issuance of senior term notes         100,000           -
Proceeds from nonrecourse obligations                19,828      68,279
Repayment of senior term notes                      (30,000)    (46,000)
Repayment of nonrecourse obligations                (38,458)    (29,532)
Net decrease in short-term borrowings                (4,833)    (17,011)
Dividends paid to Parent                             (8,500)     (6,650)
Other financing activities                              (51)        485
                                                ------------ -----------
Net cash flows provided by (used in)
 financing activities                                37,986     (30,429)
                                                ------------ -----------

Net increase in cash and cash equivalents             1,313      24,728
Cash and cash equivalents at beginning of period     67,975      61,990
                                                ------------  ----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD         $ 69,288    $ 86,718
                                                ============  ==========
                                       3
<PAGE>
GATX CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited, in thousands)
                                                     Three Months Ended
                                                         March 31,
                                                        1999       1998
                                                   ---------- ---------- 

Net income                                         $  17,945  $  21,565
                                                                               
  Foreign currency translation adjustment                443         11        
  Unrealized gain (loss) on securities, net of
    reclassification adjustments (a)                  (1,453)       434        
                                                   ---------- ----------      
Other comprehensive loss                              (1,010)       445
                                                   ---------- ----------       

COMPREHENSIVE INCOME                               $  16,935  $  22,010        
                                                   ========== ==========

(a) Reclassification adjustments:
     Unrealized gain on securities                 $     933  $   1,134        
     Less - Reclassification adjustment for gains 
            realized included in net income           (2,386)      (700)       
                                                   ---------- ----------
     Net unrealized (loss) gain on securities      $  (1,453) $     434
                                                   ========== ==========       
                                                                             


                                       4
<PAGE>

PART I.  FINANCIAL INFORMATION
Item 1.  Financial Statements, continued
 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1999 AND 1998


1.   The  consolidated  balance  sheet  of  GATX  Capital  Corporation  and  its
     subsidiaries  (the  "Company")  at December  31, 1998 was derived  from the
     audited financial statements at that date. All other consolidated financial
     statements are unaudited and include all  adjustments,  consisting  only of
     normal recurring items,  which  management  considers  necessary for a fair
     statement of the consolidated  results of operations and financial position
     for and as of the end of the indicated  periods.  Operating results for the
     three-month  period ended March 31, 1999 are not necessarily  indicative of
     the results that may be achieved for the entire year.

2.   Certain  prior year  amounts have been  reclassified  to conform to current
     presentation.

3.   The Company is engaged in various  matters of litigation and has unresolved
     claims  pending.  The  Company  is a party to  litigation  relating  to the
     conversion of ten 747 aircraft from passenger to freighter configuration by
     an affiliate of the Company.  While the amounts  claimed in this matter and
     other matters are substantial,  the ultimate liability with respect to such
     claims  cannot be  determined at this time. It is the opinion of management
     that damages,  if any,  required to be paid by the Company in the discharge
     of such liability are not likely to be material to the Company's  financial
     position  or  results  of  operations. 

4.   In June 1998, the Financial Accounting Standards Board issued Statement No.
     133,  Accounting for Derivative  Instruments and Hedging  Activities ("SFAS
     No. 133"),  which is required to be adopted in years  beginning  after June
     15, 1999.  The Company,  which  utilizes  fundamental  derivatives to hedge
     changes in interest rates and foreign currencies, expects to adopt SFAS No.
     133 effective  January 1, 2000.  This new accounting  standard will require
     that all derivatives be recorded on the balance sheet at fair value. If the
     derivative is a hedge, depending on the nature of the hedge, changes in the
     fair value of  derivatives  will either be offset against the change in the
     fair value of the hedged assets,  liabilities,  or firm commitments through
     earnings or recognized in other comprehensive  income until the hedged item
     is recognized in earnings. The ineffective portion of a derivative's change
     in fair value will be  immediately  recognized  in earnings.  Management is
     currently  assessing the impact that the adoption of SFAS No. 133 will have
     on the Company's financial position, results of operations, and cash flows.
 










                                       5
<PAGE>

PART I.   FINANCIAL INFORMATION, continued
Item 2.   Management's Discussion and Analysis

RESULTS OF OPERATIONS


Overview  
--------- 
The  Company  engages in two main  activities:  1)  asset-based  investment  and
finance,  and 2)  value-added  reselling of  technology  equipment and services.
Revenue from  asset-based  investment  and finance  activities is generated from
financing   equipment   (either  for  the   Company's  own  account  or  through
partnerships and joint ventures),  from the remarketing of assets, from managing
the equipment - related  investment  portfolios of others, and from brokering or
arranging  asset  financing  transactions. 

Net income  earned  during the three  months  ended  March 31,  1999,  was $17.9
million, down $3.6 million from the same period last year.

Revenues
--------
Investment income, which includes lease income, equity earnings from investments
in joint ventures, interest and other income, increased $11.0 million during the
three-month  period ended March 31,  1999,  compared to the same period in 1998.
Revenue  generated from higher  investment  balances during 1999 was the primary
reason for this  increase.  Investments  at March 31, 1999,  were  approximately
$73.3 million higher than the same period last year.

In addition,  other  income of $5.8 million for the first  quarter 1999 was $3.3
million  greater  than  during  the  same  period  in  1998.  This is  primarily
attributable to sales of stock which were derived from warrants  received during
the financing of non-public, start-up companies.

Asset remarketing income includes gains on the sale of the Company's  investment
assets,  fees generated from providing  remarketing  services for third parties,
and from the sale of non-owned assets in which the Company has a residual share.
Fee income  from asset  remarketing  services  is  generally  performance-based.
Although not necessarily  consistent from year to year, asset remarketing income
is a core  component  of the  Company's  business  and has  historically  been a
significant  contributor  to income.  Asset  remarketing  income  totaled  $23.3
million for the first  quarter of 1999  compared  to $30.9  million for the same
period in 1998. Gains on sales of Company  investment  assets were $18.1 million
and $25.0  million  for first  quarter  1999 and  1998,  respectively.  Residual
sharing fees were $5.2  million and $5.9 million for the first  quarter 1999 and
1998, respectively.

Technology  equipment  sales and service  revenue was $2.4 million higher during
the  quarter  than  during the first  quarter  of 1998,  while cost of sales and
services was $4.2 million higher. Gross margin for the first quarter of 1999 was
$5.3 million, or $1.8 million lower than the first quarter of 1998 primarily due
to market conditions for legacy network protocol equipment.

Expenses
--------
Operating lease expense  includes  depreciation of operating lease equipment and
rent expense on off-balance  sheet financing.  Operating lease expense was $39.5
million  during the first quarter of 1999  compared to $33.0 million  during the
same period last year. The increase in operating  lease expense is due to higher
depreciation  expense resulting from; (1) increased operating lease investments,
and (2) shorter average depreciable lives due to changes in investment mix.

Lower interest  rates and lower average debt balances  resulted in a decrease in
interest expense for first quarter 1999 compared to 1998.

Selling, general and administrative expenses were higher in the first quarter of
1999 than during the first  quarter of 1998 due to higher  human  resources  and
other  administrative  expenses  associated with increased  investment and asset
management business activity.
                                       6
<PAGE>


CASH FLOW, LIQUIDITY AND CAPITAL RESOURCES

The Company  generates cash from operations and from portfolio  proceeds and has
certain  facilities for borrowing.  In addition,  certain lease transactions are
financed by obtaining  nonrecourse  loans equal to the present  value of some or
all of the rental  streams.  During the three months  ended March 31, 1999,  the
Company used cash  generated  from  operations  to repay $30.0 million of senior
term notes.  Cash generated  from the recovery of investments  and proceeds from
the  issuance  of senior  term  notes  were used to fund  $215.1  million of new
investments.

At March 31,  1999,  the  Company had  borrowing  capacity  consisting  of $62.0
million  remaining  under its  Series E shelf  registration,  $191.7  million of
unused  capacity  under its  commercial  paper and bankers'  acceptances  credit
agreements,  and $45.9  million  remaining  under  stand-alone  bank  facilities
maintained by two of the Company's subsidiaries.

During  1999,  primarily  as a result of issuing  senior term notes,  total debt
financing increased.  This increase,  partially offset by an increase in equity,
caused the Company's debt to equity ratio to increase to 3.2:1 at March 31, 1999
from 3.1:1 at December 31, 1998. At March 31, 1999,  the Company could borrow an
additional $703.4 million and still meet the 4.5:1 leverage ratio defined in its
bank credit agreements.

The Company  maintains the proceeds  from the sale of certain  assets in a trust
with a qualified  intermediary  pending the  identification  and  acquisition of
qualified replacement assets in order to affect a like-kind exchange for federal
income  tax  purposes.  The  amounts  in trust are  classified  as cash and cash
equivalents in the accompanying  balance sheet. The amount in trust at March 31,
1999 and December 31, 1998 was $29.2 million.

The Company's capital structure  includes both fixed and floating rate debt. The
Company  ensures  a  stable  margin  over its  cost of  funds  by  managing  the
relationship  of its  fixed  and  floating  rate  investments  to its  fixed and
floating rate borrowings.

At March 31,  1999,  the Company had  approved  unfunded  transactions  totaling
approximately $419.0 million, including approximately $157.5 million expected to
fund during the remainder of 1999. Once approved for funding,  a transaction may
not be  completed  for various  reasons,  or the  investment  may be shared with
partners or sold.

YEAR 2000 DISCLOSURE

The Company  continues to address what is commonly  referred to as the Year 2000
problem.  The  Company has  completed  the  assessment  phase of  reviewing  its
critical   information   systems  for  Year  2000   compliance.   The  Company's
enterprise-wide information system has been certified Year 2000 compliant by the
manufacturer  and the Company has  performed  testing on the system.  Other less
critical  information  systems have been reviewed and corrective action is being
taken as necessary. These projects should be completed by mid-year 1999.

The Company also is reviewing its operating  assets to determine any significant
exposure to  time-sensitive  controls  which may be  embedded in the  equipment.
These exposures are being assessed on an ongoing basis.

The Company is inquiring  of customers to ensure that their  systems are or will
be Year 2000 compliant.  Where  considered  appropriate,  the Company is working
directly with third parties to test or remediate  affected systems.  The Company
also interacts electronically with certain external entities but has no means of
ensuring that they will be Year 2000 ready.  Additionally,  the Company has been
inquiring of key vendors in an effort to  establish  the ability of the provider
to deliver  products or services on a timely basis in the year 2000.  Today, the
Company  is not  aware of any third  party  with a Year 2000  issue  that  would
materially impact the Company's results of operations.
                                       7
<PAGE>

The Company  believes it has an  effective  program in place to resolve the Year
2000 issue in a timely manner and to minimize the Company's  exposure.  If these
steps were not taken,  or are not  completed in a timely  manner,  the Year 2000
issue could have a  significant  impact on the  operations  of the Company.  The
project  is  estimated  to be  completed  during  1999,  which  is  prior to any
anticipated impact on its operating  systems.  Based on the progress and results
of the Year 2000 project thus far, the Company believes that the Year 2000 issue
should not pose significant operational problems. However, in the event that the
Company's  efforts  have  not  addressed  all  potential  systems  problems,   a
contingency  plan is being developed to enable business  operations to continue.
This  contingency  plan  involves   reducing  the  scope  and  duration  of  any
disruptions  by having  sufficient  personnel  and other  resources  in place to
permit a timely  response.  The total Year 2000  project cost is estimated to be
immaterial to the Company's results of operations.

FORWARD LOOKING STATEMENTS

Certain  statements  in the  Management's  Discussion  and  Analysis  constitute
forward-looking  statements  within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although the
Company  believes  that  the  expectations  reflected  in  such  forward-looking
statements are based on reasonable  assumptions,  such statements are subject to
risks and  uncertainties,  and could cause actual  results to differ  materially
from those projected.

                                       8
<PAGE>
                                 
PART II.  OTHER INFORMATION
Item 6.   Exhibits and Reports on Form 8-K

(a)  Exhibits:

     27. Financial Data Schedule

(b)  The Company filed no reports on Form 8-K during the three months ended 
     March 31, 1999.



Signatures
----------
Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.



                                  GATX CAPITAL CORPORATION


                                  /s/ Jack F. Jenkins-Stark
                                  ------------------------- 
                                  Jack F. Jenkins-Stark
                                  Senior Vice President and 
                                  Chief Financial Officer



                                  /s/ Delphine M. Regalia
                                  -----------------------      
                                  Delphine M. Regalia
                                  Principal Accounting Officer and 
                                  Controller









May 12, 1999






                                       9
<PAGE>
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UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    Form 10-Q

                  X QUARTERLY REPORT PURSUANT TO SECTION 13 OR
                  15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

     For the Quarter Ended                    Commission File Number
        March 31, 1999                                1-8319

                            GATX CAPITAL CORPORATION

      Incorporated in the                 IRS Employer Identification Number
       State of Delaware                               94-1661392

                             Four Embarcadero Center
                             San Francisco, CA 94111
                                 (415) 955-3200

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  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

                                  Yes X  No __
                                               

All Common Stock of Registrant is held by GATX Financial Services, Inc.
   (a wholly-owned subsidiary of GATX Corporation).

As of May 10, 1999, Registrant has outstanding 1,031,250 shares of $1 par value
Common Stock.

THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a) AND
(b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED DISCLOSURE
FORMAT.
PART I.  FINANCIAL INFORMATION
Item 1.  Financial Statements

GATX CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME 
(unaudited, in thousands)

                                                    Three Months Ended
                                                         March 31,
                                                     1999         1998
                                                 ---------    ---------
                                                        (Unaudited)
REVENUES:

Lease income                                      $  72,744    $  69,307
Technology equipment sales and service               36,748       34,374
Gain on sale of assets                               18,132       25,040
Equity earnings from investment in 
  joint ventures                                     13,448       10,355
Interest                                              8,380        7,170
Fees                                                  8,788        9,076
Other                                                 5,804        2,514
                                               ------------  -----------
                                                    164,044      157,836
                                               ------------  -----------

EXPENSES:

Operating leases                                     39,548       32,999
Cost of technology equipment sales and service       31,477       27,274
Selling, general & administrative                    29,771       27,716
Interest                                             28,526       29,869
Provision for losses on investments                   2,749        2,250
Other                                                 1,151          726
                                               ------------  -----------
                                                    133,222      120,834
                                               ------------  -----------

Income before income taxes                           30,822       37,002
                                               
Provision for income taxes                           12,877       15,437
                                               ------------  -----------

NET INCOME                                        $  17,945    $  21,565
                                               ============  ===========

                                       1
GATX CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands)
                                                   March 31,  December 31,
                                                     1999          1998
                                                  ----------  ------------
                                                  (Unaudited)
ASSETS:
Cash and cash equivalents                        $   69,288    $  67,975 
Investments:
   Direct financing leases                          523,608      537,897 
   Leveraged leases                                 138,102      133,380 
   Operating lease equipment-
        net of depreciation                         560,551      547,221 
   Secured loans                                    273,347      241,567 
   Investment in joint ventures                     594,625      570,255 
   Assets held for sale or lease                     33,290       26,286
   Other investments                                 78,575       84,856
   Investment in future residuals                    17,370       18,706
   Allowance for losses on investments             (132,005)    (129,278)  
                                                ------------ ------------
          Net investments                         2,087,463    2,030,890
                                                ------------ ------------

Due from Parent                                      33,817       37,816
Other assets                                        130,832      139,001 
                                               ------------- ------------
TOTAL ASSETS                                    $ 2,321,400  $ 2,275,682
                                               ============= ============

LIABILITIES AND STOCKHOLDER'S EQUITY:
Accrued interest                                $    27,228  $    13,634
Accounts payable and other liabilities              112,945      150,504
Debt financing:
   Commercial paper and bankers' acceptances        118,300      128,329 
   Notes payable                                     31,043       25,847
   Obligations under capital leases                   8,730        8,781
   Senior term notes                              1,146,600    1,076,600
                                               -------------  -----------
          Total debt financing                    1,304,673    1,239,557  
                                               -------------  -----------
Nonrecourse obligations                             362,760      381,390
Deferred income                                      18,683        9,702
Deferred income taxes                                89,535       83,754

Stockholder's equity:
   Convertible preferred stock, par value $1,       125,000      125,000
      and additional paid-in capital
   Common stock, par value $1, and
     additional paid-in capital                      28,960       28,960
   Accumulated other comprehensive income              (238)         772
   Reinvested earnings                              251,854      242,409
                                               -------------  -----------
          Total stockholder's equity                405,576      397,141  
                                               -------------  -----------
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY     $  2,321,400  $ 2,275,682
                                               =============  ===========

                                       2
GATX CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)
                                                    Three Months Ended
                                                        March 31,
                                                       1999       1998
                                                  ----------  --------- 
                                                        (Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:

Net income                                        $  17,945    $ 21,565
Reconciliation of net income to net cash flows 
 provided by operating activities:
   Provision for losses on investments                2,749       2,250
   Depreciation and amortization expense             29,932      24,094
   Provision for deferred income taxes                7,729       8,129
   Gain on sale of assets                           (18,132)    (25,040)
   Joint venture income, net of cash dividends       (8,100)     (6,197)    
   Changes in assets and liabilities:
      Other assets                                    6,512      24,837 
      Due from Parent                                 3,999       5,679
      Accrued interest, accounts payable and        (23,965)    (37,929)
          other liabilities
      Deferred income                                 8,981      (4,893)
      Other - net                                     9,371      (2,378)
                                                ------------ -----------
Net cash flows provided by operating activities      37,021      10,117
                                                ------------ -----------

CASH FLOWS FROM INVESTING ACTIVITIES:

Investments in leased equipment, net of
 nonrecourse borrowings for leveraged leases        (88,643)    (71,009)
Loans extended to borrowers                         (74,638)    (28,741)
Other investments                                   (51,793)    (18,588)
                                                ------------ -----------
   Total investments                               (215,074)   (118,338)
                                                ------------ -----------
Lease rents received, net of earned income and
 leveraged lease nonrecourse debt service            54,070      36,477
Loan principal received                              13,529      10,275
Proceeds from sale of assets                         71,880     100,376
Joint venture investment recovery                     1,901      16,250        
                                               ------------- -----------
   Recovery of investments                          141,380     163,378
                                               ------------- -----------
Net cash flows (used in) provided by 
 investing activities                               (73,694)     45,040
                                               ------------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from issuance of senior term notes         100,000           -
Proceeds from nonrecourse obligations                19,828      68,279
Repayment of senior term notes                      (30,000)    (46,000)
Repayment of nonrecourse obligations                (38,458)    (29,532)
Net decrease in short-term borrowings                (4,833)    (17,011)
Dividends paid to Parent                             (8,500)     (6,650)
Other financing activities                              (51)        485
                                                ------------ -----------
Net cash flows provided by (used in)
 financing activities                                37,986     (30,429)
                                                ------------ -----------

Net increase in cash and cash equivalents             1,313      24,728
Cash and cash equivalents at beginning of period     67,975      61,990
                                                ------------  ----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD         $ 69,288    $ 86,718
                                                ============  ==========
                                       3
GATX CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited, in thousands)
                                                     Three Months Ended
                                                         March 31,
                                                        1999       1998
                                                   ---------- ---------- 

Net income                                         $  17,945  $  21,565
                                                                               
  Foreign currency translation adjustment                443         11        
  Unrealized gain (loss) on securities, net of
    reclassification adjustments (a)                  (1,453)       434        
                                                   ---------- ----------      
Other comprehensive loss                              (1,010)       445
                                                   ---------- ----------       

COMPREHENSIVE INCOME                               $  16,935  $  22,010        
                                                   ========== ==========

(a) Reclassification adjustments:
     Unrealized gain on securities                 $     933  $   1,134        
     Less - Reclassification adjustment for gains 
            realized included in net income           (2,386)      (700)       
                                                   ---------- ----------
     Net unrealized (loss) gain on securities      $  (1,453) $     434
                                                   ========== ==========       
                                                                             

                                       4
PART I.  FINANCIAL INFORMATION
Item 1.  Financial Statements, continued
 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1999 AND 1998

1.   The  consolidated  balance  sheet  of  GATX  Capital  Corporation  and  its
     subsidiaries  (the  "Company")  at December  31, 1998 was derived  from the
     audited financial statements at that date. All other consolidated financial
     statements are unaudited and include all  adjustments,  consisting  only of
     normal recurring items,  which  management  considers  necessary for a fair
     statement of the consolidated  results of operations and financial position
     for and as of the end of the indicated  periods.  Operating results for the
     three-month  period ended March 31, 1999 are not necessarily  indicative of
     the results that may be achieved for the entire year.

2.   Certain  prior year  amounts have been  reclassified  to conform to current
     presentation.

3.   The Company is engaged in various  matters of litigation and has unresolved
     claims  pending.  The  Company  is a party to  litigation  relating  to the
     conversion of ten 747 aircraft from passenger to freighter configuration by
     an affiliate of the Company.  While the amounts  claimed in this matter and
     other matters are substantial,  the ultimate liability with respect to such
     claims  cannot be  determined at this time. It is the opinion of management
     that damages,  if any,  required to be paid by the Company in the discharge
     of such liability are not likely to be material to the Company's  financial
     position  or  results  of  operations. 

4.   In June 1998, the Financial Accounting Standards Board issued Statement No.
     133,  Accounting for Derivative  Instruments and Hedging  Activities ("SFAS
     No. 133"),  which is required to be adopted in years  beginning  after June
     15, 1999.  The Company,  which  utilizes  fundamental  derivatives to hedge
     changes in interest rates and foreign currencies, expects to adopt SFAS No.
     133 effective  January 1, 2000.  This new accounting  standard will require
     that all derivatives be recorded on the balance sheet at fair value. If the
     derivative is a hedge, depending on the nature of the hedge, changes in the
     fair value of  derivatives  will either be offset against the change in the
     fair value of the hedged assets,  liabilities,  or firm commitments through
     earnings or recognized in other comprehensive  income until the hedged item
     is recognized in earnings. The ineffective portion of a derivative's change
     in fair value will be  immediately  recognized  in earnings.  Management is
     currently  assessing the impact that the adoption of SFAS No. 133 will have
     on the Company's financial position, results of operations, and cash flows.
 

                                       5
PART I.   FINANCIAL INFORMATION, continued
Item 2.   Management's Discussion and Analysis

RESULTS OF OPERATIONS

Overview  
--------- 
The  Company  engages in two main  activities:  1)  asset-based  investment  and
finance,  and 2)  value-added  reselling of  technology  equipment and services.
Revenue from  asset-based  investment  and finance  activities is generated from
financing   equipment   (either  for  the   Company's  own  account  or  through
partnerships and joint ventures),  from the remarketing of assets, from managing
the equipment - related  investment  portfolios of others, and from brokering or
arranging  asset  financing  transactions. 

Net income  earned  during the three  months  ended  March 31,  1999,  was $17.9
million, down $3.6 million from the same period last year.

Revenues
--------
Investment income, which includes lease income, equity earnings from investments
in joint ventures, interest and other income, increased $11.0 million during the
three-month  period ended March 31,  1999,  compared to the same period in 1998.
Revenue  generated from higher  investment  balances during 1999 was the primary
reason for this  increase.  Investments  at March 31, 1999,  were  approximately
$73.3 million higher than the same period last year.

In addition,  other  income of $5.8 million for the first  quarter 1999 was $3.3
million  greater  than  during  the  same  period  in  1998.  This is  primarily
attributable to sales of stock which were derived from warrants  received during
the financing of non-public, start-up companies.

Asset remarketing income includes gains on the sale of the Company's  investment
assets,  fees generated from providing  remarketing  services for third parties,
and from the sale of non-owned assets in which the Company has a residual share.
Fee income  from asset  remarketing  services  is  generally  performance-based.
Although not necessarily  consistent from year to year, asset remarketing income
is a core  component  of the  Company's  business  and has  historically  been a
significant  contributor  to income.  Asset  remarketing  income  totaled  $23.3
million for the first  quarter of 1999  compared  to $30.9  million for the same
period in 1998. Gains on sales of Company  investment  assets were $18.1 million
and $25.0  million  for first  quarter  1999 and  1998,  respectively.  Residual
sharing fees were $5.2  million and $5.9 million for the first  quarter 1999 and
1998, respectively.

Technology  equipment  sales and service  revenue was $2.4 million higher during
the  quarter  than  during the first  quarter  of 1998,  while cost of sales and
services was $4.2 million higher. Gross margin for the first quarter of 1999 was
$5.3 million, or $1.8 million lower than the first quarter of 1998 primarily due
to market conditions for legacy network protocol equipment.

Expenses
--------
Operating lease expense  includes  depreciation of operating lease equipment and
rent expense on off-balance  sheet financing.  Operating lease expense was $39.5
million  during the first quarter of 1999  compared to $33.0 million  during the
same period last year. The increase in operating  lease expense is due to higher
depreciation  expense resulting from; (1) increased operating lease investments,
and (2) shorter average depreciable lives due to changes in investment mix.

Lower interest  rates and lower average debt balances  resulted in a decrease in
interest expense for first quarter 1999 compared to 1998.

Selling, general and administrative expenses were higher in the first quarter of
1999 than during the first  quarter of 1998 due to higher  human  resources  and
other  administrative  expenses  associated with increased  investment and asset
management business activity.
                                       6
CASH FLOW, LIQUIDITY AND CAPITAL RESOURCES

The Company  generates cash from operations and from portfolio  proceeds and has
certain  facilities for borrowing.  In addition,  certain lease transactions are
financed by obtaining  nonrecourse  loans equal to the present  value of some or
all of the rental  streams.  During the three months  ended March 31, 1999,  the
Company used cash  generated  from  operations  to repay $30.0 million of senior
term notes.  Cash generated  from the recovery of investments  and proceeds from
the  issuance  of senior  term  notes  were used to fund  $215.1  million of new
investments.

At March 31,  1999,  the  Company had  borrowing  capacity  consisting  of $62.0
million  remaining  under its  Series E shelf  registration,  $191.7  million of
unused  capacity  under its  commercial  paper and bankers'  acceptances  credit
agreements,  and $45.9  million  remaining  under  stand-alone  bank  facilities
maintained by two of the Company's subsidiaries.

During  1999,  primarily  as a result of issuing  senior term notes,  total debt
financing increased.  This increase,  partially offset by an increase in equity,
caused the Company's debt to equity ratio to increase to 3.2:1 at March 31, 1999
from 3.1:1 at December 31, 1998. At March 31, 1999,  the Company could borrow an
additional $703.4 million and still meet the 4.5:1 leverage ratio defined in its
bank credit agreements.

The Company  maintains the proceeds  from the sale of certain  assets in a trust
with a qualified  intermediary  pending the  identification  and  acquisition of
qualified replacement assets in order to affect a like-kind exchange for federal
income  tax  purposes.  The  amounts  in trust are  classified  as cash and cash
equivalents in the accompanying  balance sheet. The amount in trust at March 31,
1999 and December 31, 1998 was $29.2 million.

The Company's capital structure  includes both fixed and floating rate debt. The
Company  ensures  a  stable  margin  over its  cost of  funds  by  managing  the
relationship  of its  fixed  and  floating  rate  investments  to its  fixed and
floating rate borrowings.

At March 31,  1999,  the Company had  approved  unfunded  transactions  totaling
approximately $419.0 million, including approximately $157.5 million expected to
fund during the remainder of 1999. Once approved for funding,  a transaction may
not be  completed  for various  reasons,  or the  investment  may be shared with
partners or sold.

YEAR 2000 DISCLOSURE

The Company  continues to address what is commonly  referred to as the Year 2000
problem.  The  Company has  completed  the  assessment  phase of  reviewing  its
critical   information   systems  for  Year  2000   compliance.   The  Company's
enterprise-wide information system has been certified Year 2000 compliant by the
manufacturer  and the Company has  performed  testing on the system.  Other less
critical  information  systems have been reviewed and corrective action is being
taken as necessary. These projects should be completed by mid-year 1999.

The Company also is reviewing its operating  assets to determine any significant
exposure to  time-sensitive  controls  which may be  embedded in the  equipment.
These exposures are being assessed on an ongoing basis.

The Company is inquiring  of customers to ensure that their  systems are or will
be Year 2000 compliant.  Where  considered  appropriate,  the Company is working
directly with third parties to test or remediate  affected systems.  The Company
also interacts electronically with certain external entities but has no means of
ensuring that they will be Year 2000 ready.  Additionally,  the Company has been
inquiring of key vendors in an effort to  establish  the ability of the provider
to deliver  products or services on a timely basis in the year 2000.  Today, the
Company  is not  aware of any third  party  with a Year 2000  issue  that  would
materially impact the Company's results of operations.
                                       7
The Company  believes it has an  effective  program in place to resolve the Year
2000 issue in a timely manner and to minimize the Company's  exposure.  If these
steps were not taken,  or are not  completed in a timely  manner,  the Year 2000
issue could have a  significant  impact on the  operations  of the Company.  The
project  is  estimated  to be  completed  during  1999,  which  is  prior to any
anticipated impact on its operating  systems.  Based on the progress and results
of the Year 2000 project thus far, the Company believes that the Year 2000 issue
should not pose significant operational problems. However, in the event that the
Company's  efforts  have  not  addressed  all  potential  systems  problems,   a
contingency  plan is being developed to enable business  operations to continue.
This  contingency  plan  involves   reducing  the  scope  and  duration  of  any
disruptions  by having  sufficient  personnel  and other  resources  in place to
permit a timely  response.  The total Year 2000  project cost is estimated to be
immaterial to the Company's results of operations.

FORWARD LOOKING STATEMENTS

Certain  statements  in the  Management's  Discussion  and  Analysis  constitute
forward-looking  statements  within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although the
Company  believes  that  the  expectations  reflected  in  such  forward-looking
statements are based on reasonable  assumptions,  such statements are subject to
risks and  uncertainties,  and could cause actual  results to differ  materially
from those projected.

                                       8
PART II.  OTHER INFORMATION
Item 6.   Exhibits and Reports on Form 8-K

(a)  Exhibits:

     27. Financial Data Schedule

(b)  The Company filed no reports on Form 8-K during the three months ended 
     March 31, 1999.

Signatures
----------
Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                                  GATX CAPITAL CORPORATION

                                  /s/ Jack F. Jenkins-Stark
                                  ------------------------- 
                                  Jack F. Jenkins-Stark
                                  Senior Vice President and 
                                  Chief Financial Officer

                                  /s/ Delphine M. Regalia
                                  -----------------------      
                                  Delphine M. Regalia
                                  Principal Accounting Officer and 
                                  Controller

May 12, 1999

                                       9