SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10 - K
Annual Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the fiscal year ended: Commission file number:
December 31, 1996 33-99334
Chevy Chase Master Credit Card Trust II
____________________________________________________
(Exact name of registrant as specified in charter)
Maryland 52-0897004
________________________________ ________________
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
c/o Chevy Chase Bank, F.S.B.
8401 Connecticut Avenue
Chevy Chase, Maryland 20815
________________________________________ __________
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (301) 986-7000
________________
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
Chevy Chase Master Credit Card Trust II
$ 368,000,000 Class A Floating Rate Asset Backed Certificates, Series 1995-A
$ 32,000,000 Class B Floating Rate Asset Backed Certificates, Series 1995-A
$ 368,000,000 Class A Floating Rate Asset Backed Certificates, Series 1995-C
$ 32,000,000 Class B Floating Rate Asset Backed Certificates, Series 1995-C
$ 369,000,000 Class A Floating Rate Asset Backed Certificates, Series 1996-A
$ 38,250,000 Class B Floating Rate Asset Backed Certificates, Series 1996-A
$ 246,000,000 Class A Floating Rate Asset Backed Certificates, Series 1996-C
$ 25,500,000 Class B Floating Rate Asset Backed Certificates, Series 1996-C
Indicate by check mark whether the Registrant has (1) 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 X No
_____ _____
The Registrant has no voting stock or class of common stock
outstanding as of the date of this report.
Page 1
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Introductory Note
Chevy Chase Bank, F.S.B. (the "Bank")is the seller and
servicer under the Pooling and Servicing Agreement (the
"Agreement"), dated as of June 1, 1995 by and between
the Bank and the Bankers Trust Company, as
the trustee, providing for the issuance from time to time
of one or more Series of Asset Backed Certificates and is
the originator of the Chevy Chase Master Credit Card
Trust II (the "Registrant" or the "Trust"). The Certificates
listed on page 1 hereof will be referred to collectively
herein as the "Certificates". The Certificates do not
represent obligations of or interests in the Bank. The
Bank has made application for an exemption from certain
reporting requirements. Pursuant to a letter from the
Security and Exchange Commission, Division of
Corporation Finance, Office of Chief Council, dated July
31, 1989 granting the Bank's application, the Bank is not
required to respond to various items of Form 10-K.
Such items are designated herein as "Not Applicable".
Part I
Item 1 Business
Not Applicable
Item 2 Properties
Not Applicable
Item 3 Legal Proceedings
None
Item 4 Submission Of Matters To A Vote Of Security Holders
None
Page 2
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Part II
Item 5 Market For Registrant's Common Equity
And Related Stockholder Matters
Each of the Certificates, representing investors' interests
in the Trust, are represented by a single certificate registered
in the name of Cede & Co., the nominee of The Depository Trust Company.
To the best knowledge of the Registrant, there is no
established public trading market for the Certificates.
Item 6 Selected Financial Data
Not Applicable
Item 7 Management's Discussion and Analysis of Financial
Condition and Results of Operations
Not Applicable
Item 8 Financial Statements and Supplementary Data
Not Applicable
Item 9 Changes In And Disagreements With Accountants
On Accounting and Financial Disclosure
None
Part III
Item 10 Directors and Executive Officers of the Registrant
Not Applicable
Item 11 Executive Compensation
Not Applicable
Page 3
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Item 12 Security Ownership Of Certain Beneficial Owners
and Management
Each of the Certificates, representing investor's interests in the
Trust, are represented by a single certificate registered in the
name of Cede & Co., the nominee of the Depository Trust
Company("DTC"), and an investor holding an interest in the Trust
is not entitled to receive a Certificate representing such intere
except in certain limited circumstances. Accordingly, Cede & Co
is the sole holder of record of the Certificates, which it held
behalf of approximately 40 brokers, dealers, banks and other
direct participants in the DTC system at December 31, 1996.
Such direct participants may hold Certificates for their own
accounts or for the accounts of their customers. The following
table sets forth, with respect to each of the Certificates, the
identity of each direct DTC participant that holds positions in
such Certificate in excess of 5% of the outstanding principal
amount thereof at December 31, 1996.
$368,000,000 1995-A Class A Certificates Aggregate Amount of Percent of
Name Certificates Held Class
Chase Manhattan Bank, N.A. $96,000,000 26.1%
The Dai-Ichi Kangyo Bank Limited $20,000,000 5.4%
First National Bank of Chicago $50,000,000 13.6%
Fuji Bank and Trust Company $120,000,000 32.6%
Morgan (J.P.) Securities Inc. $38,200,000 10.4%
$32,000,000 1995-A Class B Certificates Aggregate Amount of Percent of
Name Certificates Held Class
First National Bank of Chicago $32,000,000 100.0%
$368,000,000 1995-C Class A Certificates Aggregate Amount of Percent of
Name Certificates Held Class
Bank of New York $36,000,000 9.8%
Boston Safe Deposit & Trust Co. $31,000,000 8.4%
Chase Manhattan Bank, N.A. $80,000,000 21.7%
Chase Manhattan Bank/Chemical $30,000,000 8.2%
First National Bank of Chicago $49,500,000 13.5%
Harris Trust & Savings Bank $20,000,000 5.4%
Swiss American Securities, Inc. $36,500,000 9.9%
Citibank, N.A. $45,000,000 12.2%
$32,000,000 1995-C Class B Certificates Aggregate Amount of Percent of
Name Certificates Held Class
Chase Securities Inc. $14,000,000 43.8%
First National Bank of Chicago $18,000,000 56.3%
$369,000,000 1996-A Class A Certificates Aggregate Amount of Percent of
Name Certificates Held Class
Chase Manhattan Bank, N.A. $119,000,000 32.2%
French American Banking Corp. $25,000,000 6.8%
Investors Bank & Trust/ M.F. Custody $35,000,000 9.5%
Morgan Stanley & Co. $24,000,000 6.5%
Goldman, Sachs & Co. $117,000,000 31.7%
$38,250,000 1996-A Class B Certificates Aggregate Amount of Percent of
Name Certificates Held Class
Bankers Trust Company $19,000,000 49.7%
Chase Mahattan Bank/ Chemical $14,250,000 37.3%
Citibank, N.A. $5,000,000 13.1%
$246,000,000 1996-C Class A Certificates Aggregate Amount of Percent of
Name Certificates Held Class
Bankers Trust Company $91,000,000 37.0%
Chase Manhattan Bank $60,000,000 24.4%
First National Bank of Chicago $25,000,000 10.2%
Northern Trust Company $15,000,000 6.1%
The Sanwa Bank Limited $117,000,000 47.6%
$25,500,000 1996-C Class B Certificates Aggregate Amount of Percent of
Name Certificates Held Class
Bankers Trust Company $20,500,000 80.4%
Citibank, N.A. $5,000,000 19.6%
Page 4
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The address of each of the above participants is:
C/O The Depository Trust Company
7 Hanover Square, 22nd Floor
New York, NY 10004
Item 13 Certain Relationships and Related Transactions
None
Page 5
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Part IV
Item 14 Exhibits, Financial Statement Schedules and Reports
On Form 10-K
(a) The following documents are filed as part of this Report:
i) Summary of annual distributions on the Certificates to
Certificateholders for the year ended December 31, 1996
ii) Annual Accountant's Report dated October 20, 1996
and related Report of Management dated October 20, 1996
relating to sufficiency of accounting controls
No proxy soliciting material has been distributed by
the Trust.
SIGNATURES
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.
Chevy Chase Master Credit Card Trust II
By: Chevy Chase Bank, F.S.B.
As Seller and Servicer
Joel A. Friedman
Date: 03/31/97 By: ________________________________________
Joel A. Friedman
Senior Vice President
and Controller
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Chevy Chase Master Credit Card Trust II
Series 1995-A
1996 Distributions
Pursuant to Section 5.2 (c) of the Chevy Chase Master Credit Card Trust II
Series 1995-A Supplement to the Agreement, Chevy Chase Bank, F.S.B.
must provide the following information on an aggregate basis for
year ended December 31, 1996:
A. 1. The total amount of the distribution to Class A
Certificateholders during 1996 per $1,000
original certificate principal amount ..... $ 58.51
2. The amount of the distribution set forth
in paragraph 1 above in respect of interest on
the Class A Certificates, per $1,000 original
certificate principal amount .............. $ 58.51
3. The amount of the distribution set forth
in paragraph 1 above in respect of principal on
the Class A Certificates, per $1,000 original
certificate principal amount ............. $ 0.00
B. 1. The total amount of the distribution to Class B
Certificateholders during 1996 per $1,000
original certificate principal amount ..... $ 59.63
2. The amount of the distribution set forth
in paragraph 1 above in respect of interest on
the Class B Certificates, per $1,000 original
certificate principal amount .............. $ 59.63
3. The amount of the distribution set forth
in paragraph 1 above in respect of principal on
the Class B Certificates, per $1,000 original
certificate principal amount ............. $ 0.00
Page 7
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Chevy Chase Master Credit Card Trust II
Series 1995-C
1996 Distributions
Pursuant to Section 5.2 (c) of the Chevy Chase Master Credit Card Trust II
Series 1995-C Supplement to the Agreement, Chevy Chase Bank, F.S.B.
must provide the following information on an aggregate basis fo
year ended December 31, 1996:
A. 1. The total amount of the distribution to Class A
Certificateholders during 1996 per $1,000
original certificate principal amount ..... $ 58.77
2. The amount of the distribution set forth
in paragraph 1 above in respect of interest on
the Class A Certificates, per $1,000 original
certificate principal amount .......... $ 58.77
3. The amount of the distribution set forth
in paragraph 1 above in respect of principal on
the Class A Certificates, per $1,000 original
certificate principal amount .......... $ 0.00
B. 1. The total amount of the distribution to Class B
Certificateholders during 1996 per $1,000
original certificate principal amount ..... $ 60.05
2. The amount of the distribution set forth
in paragraph 1 above in respect of interest on
the Class B Certificates, per $1,000 original
certificate principal amount .............. $ 60.05
3. The amount of the distribution set forth
in paragraph 1 above in respect of principal on
the Class B Certificates, per $1,000 original
certificate principal amount ............. $ 0.00
Page 8
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Chevy Chase Master Credit Card Trust II
Series 1996-A
1996 Distributions
Pursuant to Section 5.2 (c) of the Chevy Chase Master Credit Card Trust II
Series 1996-A Supplement to the Agreement, Chevy Chase Bank, F.S.B.
must provide the following information on an aggregate basis for the
year ended December 31, 1996:
A. 1. The total amount of the distribution to Class A
Certificateholders during 1996 per $1,000
original certificate principal amount ..... $ 12.32
2. The amount of the distribution set forth
in paragraph 1 above in respect of interest on
the Class A Certificates, per $1,000 original
certificate principal amount .............. $ 12.32
3. The amount of the distribution set forth
in paragraph 1 above in respect of principal on
the Class A Certificates, per $1,000 original
certificate principal amount ............. $ 0.00
B. 1. The total amount of the distribution to Class B
Certificateholders during 1996 per $1,000
original certificate principal amount ..... $ 12.82
2. The amount of the distribution set forth
in paragraph 1 above in respect of interest on
the Class B Certificates, per $1,000 original
certificate principal amount .............. $ 12.82
3. The amount of the distribution set forth
in paragraph 1 above in respect of principal on
the Class B Certificates, per $1,000 original
certificate principal amount ............. $ 0.00
Page 9
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Chevy Chase Master Credit Card Trust II
Series 1996-C
1996 Distributions
Pursuant to Section 5.2 (c) of the Chevy Chase Master Credit Card Trust II
Series 1996-C Supplement to the Agreement, Chevy Chase Bank, F.S.B.
must provide the following information on an aggregate basis fo
year ended December 31, 1996:
A. 1. The total amount of the distribution to Class A
Certificateholders during 1996 per $1,000
original certificate principal amount ..... $ 0.00
2. The amount of the distribution set forth
in paragraph 1 above in respect of interest on
the Class A Certificates, per $1,000 original
certificate principal amount .............. $ 0.00
3. The amount of the distribution set forth
in paragraph 1 above in respect of principal on
the Class A Certificates, per $1,000 original
certificate principal amount ............. $ 0.00
B. 1. The total amount of the distribution to Class B
Certificateholders during 1996 per $1,000
original certificate principal amount ..... $ 0.00
2. The amount of the distribution set forth
in paragraph 1 above in respect of interest on
the Class B Certificates, per $1,000 original
certificate principal amount .............. $ 0.00
3. The amount of the distribution set forth
in paragraph 1 above in respect of principal on
the Class B Certificates, per $1,000 original
certificate principal amount ............. $ 0.00
Page 10
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MANAGEMENT'S REPORT ON THE EFFECTIVENESS OF THE INTERNAL
CONTROL STRUCTURE RELATIVE TO THE SERVICING OF CONSUMER
REVOLVING CREDIT CARD RECEIVABLES
The management of the Bank is responsible for establishing and maintaining the
internal control structure. In fulfilling this responsibility, estimates and
judgments by management are required to assess the expected benefits and
related costs of control procedures. The objectives of an internal control
structure are to provide management with reasonable, but not absolute,
assurance that assets are safeguarded against loss from unauthorized use or
disposition, and that transactions are executed in accordance with manage-
ment's authorization and recorded properly to permit the preparation of
financial statements in accordance with generally accepted accounting
principles.
We have performed an evaluation of the effectiveness of the Bank's internal
control structure based on the criteria established in Internal Control -
Integrated Framework issued by the Committee of Sponsoring Organizations of
the Treadway Commission ("COSO") relative to the servicing of consumer
revolving credit card receivables owned by Chevy Chase Credit Card Trusts
1993-A and 1993-B and Chevy Chase Master Credit Card Trust I Series 1994-1,
1994-2, 1994-3, 1994-4, 1994-5, 1994-6, 1994-7 and 1995-1 and Chevy Chase
Master Credit Card Trust II Series 1995-A, 1995-B, 1995-C and 1995-D
(collectively referred to as the "Trusts" herein) as of September 30, 1996,
and we have determined that the Bank maintained an effective internal
control structure over financial reporting relative to the servicing of
consumer revolving credit card receivables owned by the Bank's Trusts
as of September 30, 1996.
However, there are inherent limitations in the effectiveness of any internal
control structure, including the possibility of human error and the
circumvention or overriding of controls. Accordingly, even an effective
internal control structure can provide only reasonable assurance with respect
to reliability of financial statements and safeguarding and management of
assets. Furthermore, the effectiveness of any internal control structure can
change with changes in circumstances.
Dennis C. Moroney George P. Clancy
_________________ _________________
Dennis C. Moroney George P. Clancy
Senior Vice President Executive Vice President
Stephen R. Halpin, Jr.
______________________
Stephen R. Halpin, Jr.
Executive Vice President and
Chief Financial Officer
December 20, 1996
Page 11
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REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors of
Chevy Chase Bank, F.S.B.:
We have examined management's assertion, included in the accompanying
Management's Report on the Effectiveness of the Internal Control Structure
Relative to the Servicing of Consumer Revolving Credit Card Receivables, that
Chevy Chase Bank, F.S.B. (the "Bank") maintained an effective internal control
structure over financial reporting relative to the servicing of consumer
revolving credit card receivables, owned by the Bank's credit card trusts
(1993-A, 1993-B, 1994-1, 1994-2, 1994-3, 1994-4, 1994-5, 1994-6, 1994-7,
1995-1, 1995-A, 1995-B, 1995-C, and 1995-D, collectively referred to as the
"Trust" herein) as of September 30, 1996.
Our examination was made in accordance with standards established by the
American Institute of Certified Public Accountants and, accordingly, included
obtaining an understanding of the internal control structure over financial
reporting, testing, and evaluating the design and operating effectiveness of
the internal control structure, and such other procedures as we considered
necessary in the circumstances. We believe that our examination provides a
reasonable basis for our opinion.
Because of inherent limitations in any internal control structure, errors or
irregularities may occur and not be detected. Also, projections of any eval-
uation of the internal control structure over financial reporting to future
periods are subject to the risk that the internal control structure may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.
In our opinion, management's assertion that the Bank maintained an effective
internal control structure over financial reporting relative to the servicing
of consumer revolving credit card receivables owned by the Bank's credit card
Trusts as of September 30, 1996, is fairly stated, in all material respects,
based upon criteria established in Internal Control - Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission
(COSO).
This report is intended solely for the information and use of the board of
directors and management of the Bank, Chemical Bank, Bankers Trust Company,
Financial Guaranty Insurance Company, Credit Suisse, Standard & Poor's,
Moody's Investor Service and Fitch Investors Service, L.P. and should
not be used for any other purpose.
Arthur Andersen LLP
Washington, D.C.
December 20, 1996
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