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For the Quarterly Period Ended March 31, 2005
Commission File Number 0-2604

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

36-0887470
(I.R.S. employer identification No.)

Delaware
(State or other jurisdiction of incorporation or organization)

One GBC Plaza,
Northbrook, Illinois 60062
(Address of principal executive offices, including zip code)

(847) 272-3700
(Registrant's telephone number, including area code)

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GENERAL BINDING CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(000 omitted)

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GENERAL BINDING CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(000 omitted, except per share data)

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(1) Basis of Presentation

The condensed consolidated financial statements include the accounts of General Binding Corporation and its subsidiaries ("GBC" or the "Company"). These financial statements have been prepared by GBC, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. GBC believes that the disclosures included in these condensed consolidated financial statements are adequate to make the information presented not misleading. It is suggested that these condensed consolidated financial statements be read in conjunction with the financial statements and the notes thereto included in GBC's 2004 Annual Report on Form 10-K. In the opinion of management, all adjustments necessary to present the financial position of GBC as of March 31, 2005 and the results of their operations and cash flows for the three months ended March 31, 2005 and 2004 have been included. Operating results for any interim period are not necessarily indicative of results that may be expected for the full year.

The preparation of financial statements in conformity with generally accepted accounting principles requires the use of certain estimates by management in determining the entity's assets, liabilities, revenues and expenses. Such estimates and management judgement include the allowance for doubtful accounts and sales returns, allowances for slow-moving and obsolete inventory, deferred income tax valuation allowance, tax reserves, and long-lived assets. Actual results could differ from the estimates used by management.

Certain amounts for prior periods have been reclassified to conform to the 2005 presentation.

(2) Stock Compensation Plan

GBC has stock-based compensation plans for employees and non-employee directors that provide for the issuance of stock options and restricted stock units. The Company applies the recognition and measurement principles of Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees," and related interpretations in accounting for these plans. In accordance with the intrinsic value method, no compensation expense is recognized for the Company's fixed stock option plans.

The following table illustrates the effect on net income and earnings per share if the Company had applied the fair value provisions of SFAS No. 123, "Accounting for Stock-Based Compensation", to all stock-based compensation (000 omitted):

Pro forma compensation expense for stock options was calculated using the Black-Scholes model, with the following weighted-average assumptions for grants in 2005 and 2004 respectively: expected life of ten years for 2005 and 2004; expected volatility of 67% and 59%; and risk-free interest rates of 4.27% and 4.41%. The weighted-average fair values of stock options granted during the periods were $9.81 and $12.02 in 2005 and 2004, respectively.

(3) Borrowings

GBC has two financing arrangements that provide the Company with the majority of its debt capacity. A significant portion of GBC's long-term funding has been provided through its primary senior credit facility (the "Primary Facility"). As of March 31, 2005, the Primary Facility was comprised of a $72.5 million multi-currency revolving credit facility and term loans totaling $109.0 million. Outstanding borrowings under the Primary Facility at March 31, 2005 included $109.0 million for the term loans and $9.8 million under the revolving credit facility. In addition, there were outstanding letters of credit of $12.0 million, which further reduce GBC's availability under the revolving credit facility. GBC's other major financing arrangement is a multi-currency revolving credit facility in the Netherlands ("the Netherlands Facility"). As of March 31, 2005, outstanding borrowings on the Netherlands Facility were $0.8 million. GBC also has a mortgage financing arrangement under which its real estate holdings in Northbrook, Illinois and its real estate and equipment holdings in Addison, Illinois are pledged as collateral ("Mortgage Financing"). During the first quarter of 2005, GBC sold its real estate holdings in Skokie, Illinois, which previously had also been pledged as collateral under the mortgage financing. Approximately $1.9 million of the proceeds from the sale were used to prepay the Mortgage Financing. As of March 31, 2005, outstanding borrowings on the Mortgage Financing were $8.6 million.

Interest rates on the Primary Facility are variable and, during 2005, were set at LIBOR plus 3.5% for borrowings under the $72.5 million multi-currency revolving credit line, and LIBOR plus 4.50% for the term loans. Borrowings under the Primary Facility are subject to a pricing

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grid which provides for lower interest rates in the event that certain of GBC's financial ratios improve in future periods.

GBC must meet certain restrictive financial covenants as defined under the Primary Facility. The covenants become more restrictive over time and require the Company to maintain certain ratios related to total leverage, senior leverage, fixed charge coverage, as well as a minimum level of consolidated net worth. There are also other covenants, including restrictions on dividend payments, acquisitions, additional indebtedness, and capital expenditures. In addition to the restrictive covenants, multi-currency revolving credit line borrowings are subject to a "borrowing base" which is based upon certain formulas tied to GBC's trade receivables and inventory. With the exception of certain domestic assets (primarily property, plant and equipment) pledged under a Mortgage Financing, substantially all of the assets of General Binding Corporation and its domestic subsidiaries, as well as a portion of the equity in certain foreign subsidiaries are pledged as collateral under the Primary Facility.

In January 2005, the Company entered into an amendment to the Primary Facility. The amendment, among other things, modifies certain financial covenants related to Total Leverage and Senior Leverage, as those terms are defined in the Primary Facility, to make them less restrictive. The modifications also provided for the planned disposition of certain real property. The Company was in compliance with the covenants of the Primary Facility both before and after the amendment.

As of and for the three months ended March 31, 2005, the Company was in compliance with all financial covenants.

Long-term debt consisted of the following at March 31, 2005 and December 31, 2004 (000 omitted):

(4) Common Stock and Earnings Per Share

 (1) Weighted average shares includes both Common Stock and Class B Common Stock.
 (2) Amounts represent per share amounts for both Common Stock and Class B Common Stock.
 (3) For the three months ended March 31, 2005 and 2004, GBC had 674,794 and 770,469 dilutive        shares outstanding, respectively. These dilutive shares are related to stock options and        restricted stock units that were granted under the Company's stock compensation plans.        Potentially dilutive shares were not included in 2005 diluted earnings per share as they would        have been anti-dilutive.

(1) The restructuring reserve at March 31, 2005 consisted of $1.9 million related to current items       reported in the balance sheet as a separate item and $1.6 million related to long-term lease       agreement costs reported in the balance sheet as a component of other long-term liabilities.

The Company expects to contribute a total of $2.7 million to its pension plans in 2005.