SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549


                                    FORM 8-K

                                 CURRENT REPORT



     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
       Date of Report (Date of earliest event reported) February 25, 1997





                         TELEBANC FINANCIAL CORPORATION
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


       Delaware                      33-76930                 13-3759196
--------------------------------------------------------------------------------
    (State or other          (Commission File Number)        (IRS Employer
    jurisdiction of                                       Identification No.)
    incorporation)


1111 North Highland Street, Arlington, Virginia                     22201
--------------------------------------------------------------------------------
(Address of principal executive office)                          (Zip Code)


Registrant's telephone number, including area code:           (703) 247-3700
                                                              --------------


                                 Not Applicable
--------------------------------------------------------------------------------
          (Former name or former address, if changed since last report)





<PAGE>





Item 5.  Other Events.
         -------------

         Unit Purchase Agreement. TeleBanc Financial Corporation (the "Company")
entered into a Unit Purchase Agreement,  dated as of February 19, 1997, with the
Purchasers identified therein (the "Unit Purchase  Agreement").  Also as part of
the transaction pursuant to which the Company sold Units (as defined in the Unit
Purchase   Agreement),   the  Company  entered  into  an  Amended  and  Restated
Acquisition  Agreement,  dated as of  February  19,  1997,  with  Arbor  Capital
Partners, Inc. ("Arbor"), MET Holdings Corporation and William M. Daugherty (the
"Acquisition  Agreement").  The sale of Units to the Purchasers  pursuant to the
Unit Purchase  Agreement and the  acquisition by the Company of the Arbor Assets
(as defined in the Acquisition  Agreement) pursuant to the Acquisition Agreement
occurred on February  28, 1997.  The Unit  Purchase  Agreement  and the exhibits
thereto is  attached as Exhibit  10.1  hereto,  and  incorporated  by  reference
herein.  The  Acquisition  Agreement  is attached as Exhibit  10.2  hereto,  and
incorporated by reference herein.


         Certificate of  Designation.  In connection  with the issuance of Units
pursuant to the Unit Purchase  Agreement,  the Company  filed a  Certificate  of
Designation  with the Office of the  Secretary of State of the State of Delaware
on February 25, 1997 (the  "Certificate  of  Designation").  The  Certificate of
Designation  is  attached as Exhibit 3 hereto,  and  incorporated  by  reference
herein.



Item 7.  Financial Statements and Exhibits.
         ----------------------------------

         (c)  Exhibits

               Exhibit No.      Description



                           3    Certificate of Designation

                        10.1    Unit Purchase Agreement

                        10.2    Amended and Restated Acquisition Agreement



<PAGE>



                                    SIGNATURE



         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 hereunto duly authorized.

                                      TELEBANC FINANCIAL CORPORATION


Date:  March 13, 1997                 By:    /s/ Aileen Lopez Pugh
                                             ---------------------
                                                Aileen Lopez Pugh
                                                Executive Vice President-
                                                   Chief Financial Officer 
                                                   and Treasurer


<PAGE>



                                INDEX TO EXHIBITS

Exhibit
Number                           Exhibit Description
------                           -------------------

      3                         Certificate of Designation

    10.1                        Unit Purchase Agreement

    10.2                        Amended and Restated Acquisition Agreement
[{"type": "8-K", "sequence": "1", "description": "FORM 8-K", "secsgml_size_bytes": 4506}]
{"company-data": {"conformed-name": "TELEBANC FINANCIAL CORP", "cik": "0000920986", "assigned-sic": "6035", "irs-number": "133759196", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "033-76930", "film-number": "97557400"}, "business-address": {"street1": "1111 N HIGHLAND ST", "city": "ARLINGTON", "state": "VA", "zip": "22201", "phone": "7032473700"}, "mail-address": {"street1": "1111 NORTH HIGHLAND ST", "city": "ARLINGTON", "state": "VA", "zip": "22201"}}
SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 8-K

                                 CURRENT REPORT

     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
       Date of Report (Date of earliest event reported) February 25, 1997

                         TELEBANC FINANCIAL CORPORATION
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

       Delaware                      33-76930                 13-3759196
--------------------------------------------------------------------------------
    (State or other          (Commission File Number)        (IRS Employer
    jurisdiction of                                       Identification No.)
    incorporation)

1111 North Highland Street, Arlington, Virginia                     22201
--------------------------------------------------------------------------------
(Address of principal executive office)                          (Zip Code)

Registrant's telephone number, including area code:           (703) 247-3700
                                                              --------------

                                 Not Applicable
--------------------------------------------------------------------------------
          (Former name or former address, if changed since last report)
Item 5.  Other Events.
         -------------

         Unit Purchase Agreement. TeleBanc Financial Corporation (the "Company")
entered into a Unit Purchase Agreement,  dated as of February 19, 1997, with the
Purchasers identified therein (the "Unit Purchase  Agreement").  Also as part of
the transaction pursuant to which the Company sold Units (as defined in the Unit
Purchase   Agreement),   the  Company  entered  into  an  Amended  and  Restated
Acquisition  Agreement,  dated as of  February  19,  1997,  with  Arbor  Capital
Partners, Inc. ("Arbor"), MET Holdings Corporation and William M. Daugherty (the
"Acquisition  Agreement").  The sale of Units to the Purchasers  pursuant to the
Unit Purchase  Agreement and the  acquisition by the Company of the Arbor Assets
(as defined in the Acquisition  Agreement) pursuant to the Acquisition Agreement
occurred on February  28, 1997.  The Unit  Purchase  Agreement  and the exhibits
thereto is  attached as Exhibit  10.1  hereto,  and  incorporated  by  reference
herein.  The  Acquisition  Agreement  is attached as Exhibit  10.2  hereto,  and
incorporated by reference herein.

         Certificate of  Designation.  In connection  with the issuance of Units
pursuant to the Unit Purchase  Agreement,  the Company  filed a  Certificate  of
Designation  with the Office of the  Secretary of State of the State of Delaware
on February 25, 1997 (the  "Certificate  of  Designation").  The  Certificate of
Designation  is  attached as Exhibit 3 hereto,  and  incorporated  by  reference
herein.

Item 7.  Financial Statements and Exhibits.
         ----------------------------------

         (c)  Exhibits

               Exhibit No.      Description

                           3    Certificate of Designation

                        10.1    Unit Purchase Agreement

                        10.2    Amended and Restated Acquisition Agreement
SIGNATURE

         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 hereunto duly authorized.

                                      TELEBANC FINANCIAL CORPORATION

Date:  March 13, 1997                 By:    /s/ Aileen Lopez Pugh
                                             ---------------------
                                                Aileen Lopez Pugh
                                                Executive Vice President-
                                                   Chief Financial Officer 
                                                   and Treasurer
INDEX TO EXHIBITS

Exhibit
Number                           Exhibit Description
------                           -------------------

      3                         Certificate of Designation

    10.1                        Unit Purchase Agreement

    10.2                        Amended and Restated Acquisition Agreement