==========================================================================
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, 1997
COMMISSION FILE NUMBER 0-27190
PARAMOUNT FINANCIAL CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 11-3072768
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
ONE JERICHO PLAZA, JERICHO, NEW YORK 11753
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
(516) 938-3400
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
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 X NO
------- -------
NUMBER OF SHARES OUTSTANDING AT MAY 12, 1997:
7,990,000 SHARES OF COMMON STOCK, PAR VALUE $0.01 PER SHARE.
==========================================================================
<PAGE>
PARAMOUNT FINANCIAL CORPORATION
INDEX TO FORM 10-Q FOR THE QUARTER ENDED
MARCH 31, 1997
PART I - FINANCIAL INFORMATION Page No.
--------
Item 1 - Financial Statements
Consolidated Balance Sheets
March 31, 1997 and December 31, 1996 . . . . . . 1
Consolidated Statements of Operations
Three Months Ended March 31, 1997 and 1996 . . . 2
Consolidated Statement of Changes in Stockholders'
Equity Three Months Ended March 31, 1997 . . . . 3
Consolidated Statements of Cash Flows
Three Months Ended March 31, 1997 and 1996 . . . 4
Notes to Unaudited Consolidated
Financial Statements . . . . . . . . . . . . . . 5
Item 2 - Management's Discussion and Analysis of
Financial Condition and Results of Operations 6-9
PART II - Other Information . . . . . . . . . . . . . . . . 10
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . 11
<PAGE>
PART I: FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
PARAMOUNT FINANCIAL CORPORATION AND SUBSIDIAARY
-----------------------------------------------
CONSOLIDATED BALANCE SHEETS
---------------------------
DECEMBER 31, MARCH 31,
ASSETS 1996 1997
------------ -----------
(UNAUDITED)
Cash and cash equivalents . . . . . . . $ 3,700,774 $ 5,089,380
Investments available for sale. . . . . 3,163,841 1,897,183
Accounts receivable . . . . . . . . . . 2,260,013 1,046,214
Net investment in direct finance
and sales-type leases . . . . . . . . 20,942,542 27,909,514
Assets held under operating leases, net
of accumulated depreciation . . . . . 21,103,033 16,954,404
Other assets . . . . . . . . . . . . . 391,317 376,735
----------- -----------
Total assets . . . . . . . . . . . . . $51,561,520 $53,273,430
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
Notes payable . . . . . . . . . . . . . $ 18,384 $ 1,977,396
Accounts payable . . . . . . . . . . . 1,062,226 999,319
Accounts payable - leases . . . . . . . 18,234,518 679,787
Accrued expenses . . . . . . . . . . . 188,169 199,638
Obligations for financed equipment -
non-recourse . . . . . . . . . . . . 23,461,175 40,748,482
Deferred income taxes . . . . . . . . . 425,662 425,662
----------- -----------
Total liabilities . . . . . . . . . . . 43,390,134 45,030,284
----------- -----------
Shareholders' equity:
Preferred stock, $.01 par value;
5,000,000 shares authorized, none
outstanding . . . . . . . . . . . . -- --
Common stock, $.01 par value; 35,000,000
shares authorized, 3,500,000 and
7,990,000 shares issued
and outstanding, respectively . . . . 79,900 79,900
Additional paid-in capital . . . . . . 13,644,228 13,644,228
Accumulated deficit . . . . . . . . . . (5,552,742) (5,480,982)
----------- -----------
Total shareholder's equity . . . . . . 8,171,386 8,243,146
----------- -----------
Total liabilities and $51,561,520 $53,273,430
shareholders' equity . . . . . . . . =========== ===========
See accompanying notes to financial statements.
-1-
<PAGE>
PARAMOUNT FINANCIAL CORPORATION AND SUBSIDIARY
----------------------------------------------
CONSOLIDATED STATEMENTS OF OPERATIONS
-------------------------------------
FOR THE THREE MONTHS ENDED MARCH 31,
------------------------------------
UNAUDITED
---------
1996 1997
-------- --------
REVENUES:
Sales . . . . . . . . . . . . . $1,077,297 $ 936,239
Lease revenue . . . . . . . . . 647,602 2,609,347
Fee, interest and
other income . . . . . . . . 70,528 500,875
---------- ----------
Total revenues . . . . $1,795,427 $4,046,461
---------- ----------
COSTS AND EXPENSES:
Cost of sales . . . . . . . . . 964,302 775,144
Lease expense . . . . . . . . . 559,446 2,449,082
Selling, general and
administrative expenses . . . 459,311 702,636
---------- ----------
Total costs and expenses 1,983,059 3,926,862
---------- ----------
(Loss) income before provision
for income taxes . . . . . . (187,632) 119,599
(BENEFIT) PROVISION FOR INCOME
TAXES . . . . . . . . . . . . (75,053) 47,839
---------- ----------
Net (loss) income . . . ($112,579) $71,760
=========== ==========
Basic (loss) earnings per
common share . . . . $(0.02) $0.01
=========== ==========
Weighted average common shares
outstanding . . . . . . . . . 7,267,143 7,990,000
=========== ==========
See accompanying notes to financial statements.
-2-
<PAGE>
PARAMOUNT FINANCIAL CORPORATION AND SUBSIDIARY
----------------------------------------------
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
---------------------------------------------------------
FOR THE THREE MONTHS ENDED MARCH 31, 1997
-----------------------------------------
UNAUDITED
---------
COMMON STOCK
-----------------------
SHARES AMOUNT
------ ------
BALANCE, DECEMBER 31, 1996 . . . 7,990,000 $79,900
Net income . . . . . . . . . . . - -
--------- -------
BALANCE, MARCH 31, 1997 . . . . . 7,990,000 $79,900
========= =======
ADDITIONAL ACCUMULATED
PAID-IN CAPITAL (DEFICIT) TOTAL
--------------- ----------- -----
BALANCE, DECEMBER 31, 1996 $13,644,228 ($5,552,742) $8,171,386
Net income . . . . . . . . - 71,760 71,760
----------- ----------- ----------
BALANCE, MARCH 31, 1997 . . $13,644,228 ($5,480,982) $8,243,146
=========== =========== ==========
See accompanying notes to financial statements.
-3-
<PAGE>
PARAMOUNT FINANCIAL CORPORATION AND SUBSIDIARY
----------------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
-------------------------------------
FOR THE THREE MONTHS ENDED MARCH 31,
------------------------------------
UNAUDITED
---------
1996 1997
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income . . . . . . . . . . ($112,579) $71,760
Adjustments to reconcile net (loss)
income to net cash provided by (used
in) operating activities:
Depreciation . . . . . . . . . . . 361,656 1,894,449
Amortization of discounts on
investments . . . . . . . . . . . (37,808) (48,436)
Amortization of unearned operating
lease revenue from sublease
transactions . . . . . . . . . . (15,473) --
Amortizaton of prepaid operating
lease expense from sublease
transactions . . . . . . . . . . 13,567 --
Changes in operating assets and
liabilities:
Accounts receivable . . . . . . (169,548) 1,213,799
Other assets . . . . . . . . . 418,412 14,582
Accounts payable . . . . . . . (102,688) (62,907)
Accounts payable - leases . . . 3,192,500 (17,554,731)
Accrued expenses . . . . . . . (242,901) 11,469
----------- -----------
Net cash provided by (used in)
operating activities . . . . . . . 3,305,138 (14,460,015)
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of equipment for direct
finance leases and sales-type
leases . . . . . . . . . . . . . (8,840,394) (10,110,254)
Termination of direct finance leases -- 272,922
Proceeds applied to direct finance
leases and sales-type leases . . 686,454 2,156,303
Purchase of equipment for operating
leases . . . . . . . . . . . . . (12,903,224) (41,333)
Termination of operating leases . . 65,626
Residual value sharing arrangements -- 3,009,570
Purchases of investments . . . . . (8,529,843) (1,879,906)
Proceeds from sale/maturity of
investments . . . . . . . . . . . 3,000,000 3,195,000
----------- ------------
Net cash used in investing activities (26,521,381) (3,397,698)
----------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from sale of common stock in
an initial public offering, net of 8,590,827 --
fees . . . . . . . . . . . . . .
Proceeds from notes payable . . . . -- 1,959,567
Repayment of notes payable . . . . (1,532,186) (555)
Increase in non-recourse lease
financing . . . . . . . . . . . . . 17,937,808 21,036,113
Repayments and interest amortization
applied to non-recourse lease
financing . . . . . . . . . . . . . (1,072,176) (3,748,806)
----------- ------------
Net cash provided by financing
activities . . . . . . . . . . . . 23,924,273 19,246,319
----------- ------------
Net increase in cash and cash
equivalents . . . . . . . . . . . . 708,030 1,388,606
CASH AND CASH EQUIVALENTS, beginning
of period . . . . . . . . . . . . . 1,153,476 3,700,774
----------- ------------
CASH AND CASH EQUIVALENTS, end of
period . . . . . . . . . . . . . . $1,861,506 $5,089,380
=========== ============
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for income taxes . . . . $ 9,681 $ 47,850
=========== ============
Cash paid for interest . . . . . . $ 183,841 $ 553,374
=========== ============
See accompanying notes to financial statements.
-4-
<PAGE>
PARAMOUNT FINANCIAL CORPORATION AND SUBSIDIARY
----------------------------------------------
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------------
1. The accompanying unaudited consolidated financial statements have been
prepared in accordance with the instructions for Form 10-Q and
Regulation S-X related to interim period financial statements and,
therefore, do not include all information and footnotes required by
generally accepted accounting principles. However, in the opinion of
management, all adjustments (consisting of normal recurring
adjustments and accruals) considered necessary for a fair presentation
of the financial position of Paramount Financial Corporation and
subsidiary (the "Company") at March 31, 1997 and its results of
operations and cash flows for the three months ended March 31, 1996
and 1997, respectively, have been included. The results of operations
for the interim periods are not necessarily indicative of the results
that may be expected for the entire year. Reference should be made to
the annual financial statements, including footnotes thereto, included
in the Company s Form 10-K for the fiscal year ended December 31,
1996.
2. The financial statements for the three months ended March 31, 1997 are
consolidated to include the results of Paratech Resources, Inc. All
intercompany balances and transactions have been eliminated.
3. In 1997, the Company adopted Statement of Financial Accounting
Standards No. 128, "Earnings per Share." This new standard simplifies
the standards for computing earnings per share. Basic earnings per
common share are computed by dividing net income by the weighted
average number of shares of common stock outstanding during the
quarter. Diluted earnings per share reflect the potential dilution
that could occur if securities or other contracts to issue common
stock were exercised or converted into common stock or resulted in the
issuance of common stock that then shared in the earnings of the
Company. The Company has presented basic earnings per common share.
Diluted earnings per share are not presented since all potential
common shares are antidilutive.
4. Certain prior year amounts have been reclassified to conform with the
1997 presentation.
-5-
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with, and is
qualified in its entirety by, the unaudited financial statements, including
the notes thereto, included elsewhere in this report.
GENERAL
Paramount Financial Corporation ("Paramount" or the "Company") is a
comprehensive information technology ("IT") asset management and solution
provider offering customers a wide range of integrated services, including
lease finance, network design and implementation.
The operating results of Paramount are subject to quarterly fluctuations
resulting from a variety of factors, including product announcements by
manufacturers, economic conditions, interest rate fluctuations and
variations in the mix of leases written. In addition, the Company s sales
volume can fluctuate significantly from quarter to quarter based on the
closing date and nature of each particular sales transaction. The mix of
leases written in a quarter is a result of a combination of factors,
including changes in customer demands and/or requirements, new product
announcements, price changes, changes in delivery dates, changes in
maintenance policies and pricing policies of equipment manufacturers and
price competition from other lessors. Leasing transactions (other than
sales type leases), in general, do not provide for significant earnings in
the month of lease origination. Instead, revenue, expense and profit from
lease transactions are recorded over the life of the asset and the lease.
Lease revenue and lease expense recognition is dependent upon a number of
factors, including the term of the lease, the accounting classification of
the lease (i.e. operating, direct finance, or sales type), and the
commencement date of the lease and the lease financing within a particular
period. See "Lease Accounting." Given the possibility of such
fluctuation, the Company believes that comparisons of the results of its
operations for preceding quarters are not necessarily meaningful and that
such results for one quarter should not be relied upon as an indication of
future performance.
During the quarter ended March 31, 1997, the Company continued to pursue
its primary business strategy of developing a high quality portfolio of
essential IT equipment on lease to relationship based end user customers,
while at the same time evolving into a total technology solution provider.
The Company believes that this strategy will create financial benefits over
a continuum of time, since, unlike other equipment, IT equipment is
frequently upgraded and/or enhanced during the term of its lease. As a
lessor and solution provider, the Company believes that it is positioned to
meet the ever changing needs of its customers.
The results of operations for the three months ended March 31, 1997 are
presented on a consolidated basis including the results of Paratech
Resources Inc. ("Paratech"), the Company's system integration subsidiary,
which commenced operations during the third quarter of 1996. The Company
believes that the addition of Paratech is a major step towards establishing
Paramount as a total high technology solution provider. The Company is now
able to offer its customers technology, a plan for keeping that technology
current and an effective means for financing that technology. The first
quarter of 1997 continued to be a period of investment and groundwork for
Paratech, as the business was staffing up and establishing its presence in
the market.
Paramount has always operated in a highly competitive and rapidly
changing marketplace. The Company believes that its ability to adapt to
changes and to evolve into a valued business partner for its customers,
offering a complete package of products in the high technology area, is a
key component to the Company s long term growth strategy.
-6-
<PAGE>
LEASE ACCOUNTING
In accordance with Statement of Financial Accounting Standard No. 13,
"Accounting for Leases," the Company classifies its leases as either direct
finance leases or operating leases. The allocation of income among
accounting periods within a lease term will vary depending upon the lease
classification, as described below.
Direct Finance Leases: Direct finance leases transfer substantially all
benefits and risks of equipment ownership to the lessee. A lease is a
direct finance lease if it meets one of the following criteria: (1) the
lease transfers ownership of the equipment to the lessee by the end of the
lease term; (2) the lease contains a bargain purchase option; (3) the lease
term at inception is at least 75% of the estimated economic life of the
leased equipment; or (4) the present value of the minimum lease payments is
at least 90% of the fair value of the leased equipment at lease inception.
At lease inception, the cost of equipment under a direct finance lease
is recorded as "Net investment in direct finance leases". The difference
between the gross lease payments receivable, plus the estimated residual
value of the equipment, and the equipment cost is recognized as income over
the life of the lease using the interest method.
A lease transaction which meets all of the above criteria, and in which
the Company has made a dealer's profit, is recorded as a sales type lease.
A sales type lease is a type of direct finance lease, but one in which the
Company recognizes, at lease inception, revenue and profit which arises
from the difference between the fair market value of the leased equipment
and its acquisition cost.
Operating Leases: All lease contracts which do not meet the criteria of
direct finance leases are accounted for as operating leases. Monthly lease
payments are recorded as operating lease revenue. Leased equipment is
recorded at the Company s cost and depreciated on a straight-line basis
over the lease term to the estimated residual value at the expiration of
the lease term.
The Company's portfolio of equipment on lease is further divided into
equipment owned by Paramount and equipment managed by Paramount. As of
March 31, 1997, the portfolio of equipment on lease owned by Paramount had
a combined net book value on the balance sheet of $44.9 million and had an
original cost basis of $60.5 million. Equipment managed by Paramount is
equipment on lease to customers of Paramount which was subsequently sold to
investors, but with respect to which Paramount remains the lessor and
remarketing agent. The portfolio of equipment managed by Paramount had an
original cost of $20.2 million. Thus, as of March 31, 1997, the portfolio
of equipment on lease owned and managed by Paramount had an original
acquisition cost of $80.7 million.
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 1997 COMPARED TO THREE MONTHS ENDED MARCH 31,
1996
The Company recorded pre-tax income of $119,600 for the three months
ended March 31, 1997 as compared to a pre-tax loss of $187,600 for the
comparable period ended March 31, 1996. Net income for the first quarter
of 1997 was $71,800, after a provision for income taxes of $47,800, as
compared with a net loss of $112,600, after the benefit for income taxes of
$75,100.
Lease revenue, comprised of rental income from operating leases and
interest income from direct finance and sales type leases, increased by
302.9% to $2.6 million for the three months ended March 31, 1997 from
$647,600 for the comparable period ended March 31, 1996. Lease expense,
which includes depreciation expense on operating leases, interest expense
on lease financing and sublease rent expense, increased by 337.8% to $2.4
-7-
<PAGE>
million for the three months ended March 31, 1997 from $559,400 for the
three months ended March 31, 1996. These increases are a direct result of
the Company s continuing efforts to expand its leasing portfolio. See
"General" and "Lease Accounting."
For the three months ended March 31, 1997, the Company recorded sales
revenue of $936,200, a decrease of 13.1% from the $1.1 million recorded
during the three months ended March 31, 1996. Of the total sales revenue
recorded during the first quarter of 1997, $567,700 was contributed by
Paratech. See General.
During the three months ended March 31, 1997, the Company generated
$500,900 in fee, interest and other income, compared to $70,500 for the
comparable period last year. The majority of this increase ($416,000) is
attributable to the Company's involvement in certain transactions in which
it acts as an arranger of financing for leases originated by third parties,
or otherwise assists these companies with their lease related transactions.
These transactions come about as a result of the Company s relationship
with other lessors and financial institutions. The Company cannot predict
with any certainty the timing and nature of any future such transactions.
See "General." The remaining increase represents interest income which is
derived from the investment of the Company's cash balances in interest
bearing cash accounts, cash equivalents and marketable securities during
the period ended March 31, 1997.
Selling, general and administrative expenses ("SG&A") totaled $702,600
for the three months ended March 31, 1997, representing an increase of
53.0% over the $459,300 recorded during the three months ended March 31,
1996. The increase in SG&A is a result of the expansion of the operations
of Paratech, and the increased sales and support staff at the Company. See
"General."
The tax provision of $47,800 for the three months ended March 31, 1997
reflects an effective rate of 40% for federal and state taxes. During the
three months ended March 31, 1996, the Company recorded a tax benefit of
$75,000, reflecting the same 40% effective tax rate.
During the three months ended March 31, 1997, the Company entered into
new lease transactions totaling $10.1 million of equipment cost as compared
with $21.7 million for the three months ended March 31, 1996. Of the total
cost of equipment leased during the quarter ended March 31, 1997, $10.1
million was recorded as direct finance leases, and $41,000 was recorded as
operating leases, compared to $8.8 million and $12.9 million respectively,
for the quarter ended March 31, 1996. See "General" and "Lease Accounting."
During the quarter ended March 31, 1997, the Company entered into $21.0
million of non-recourse lease financing arrangements, as compared with
$17.9 million for the three months ended March 31, 1996. See "Liquidity
and Capital Resources." Non-recourse debt entered during the three months
ended March 31, 1997 increased at a faster rate than new lease origination
as a result of the timing of the closing of certain large lease
transactions. Of the total amount of non-recourse debt, $13.3 million
related to leases that commenced in December 1996, but for which the
Company was not required to pay for the equipment until January 1997. This
amount was recorded as accounts payable-leases on the Company s December
31, 1996 balance sheet.
LIQUIDITY AND CAPITAL RESOURCES
As of March 31, 1997, the Company had $7.0 million in cash, cash
equivalents and marketable securities. Substantially all of this amount
was invested in interest-bearing savings accounts, money market accounts
established by major commercial banks, or in United States Government or
other AA rated obligations. Since inception, the Company has been able to
cover its SG&A expenses from internally generated cash flow and has never
had to borrow funds to cover such operating expenses. Although the
Company s business is subject to monthly and quarterly fluctuations that
may require the Company to use its cash balances to cover such expenses for
short periods of time, the Company does not anticipate having to use
significant amounts of its cash balances to cover such expenses.
-8-
<PAGE>
The Company finances substantially all of its leases by discounting the
payment streams on a non-recourse basis through various banks and financial
institutions. Thus, the only cash required in these lease transactions is
the residual value investment by the Company. The Company believes that it
currently has sufficient resources to make the residual value investments
required to grow its lease portfolio. In addition, the Company has
numerous options available to it for the financing of residual value
investments, including sales of equipment on lease to equipment investors,
residual value sharing arrangements, recourse loans and non-recourse loans.
The Company intends to use, on an opportunistic basis, all such available
resources in order to maximize its portfolio of equipment on lease.
During the three months ended March 31, 1997, the Company entered into
several residual value sharing and financing arrangements with an equipment
investor totaling $5.0 million. This investor (i) purchased a portion of
the Company's residual value of equipment on lease in exchange for the
right to share in remarketing proceeds generated from the equipment upon
lease, and (ii) provided recourse financing for the remaining portion of
the Company's residual value investment. The equipment on lease and the
related leases serve as collateral for these financings. The Company
expects to repay these loans through the proceeds generated from
remarketing the subject equipment. These transactions allow the Company to
continue to grow and expand its lease portfolio without affecting its
current cash balances.
At March 31, 1997, the Company had two lines of credit available. These
credit lines allow the Company to borrow up to $1.25 million in the
aggregate and are secured by equipment and contracts to sell or lease that
equipment. Borrowings under these lines bear interest at 1% above the
prime rate. In addition, one of these lines offers the Company the ability
to borrow up to $100,000 on an unsecured basis. The purpose of these
credit lines is to allow the Company to pay its suppliers on a timely basis
while waiting for the customer to pay or for the non-recourse financing to
occur. During the three months ended March 31, 1997, the Company had not
borrowed any amounts from these lines, and accordingly had nothing
outstanding as of March 31, 1997.
FORWARD LOOKING STATEMENTS AND ASSOCIATED RISK
Statements contained in this Form 10-Q which are not historical facts
are forward-looking statements. The Forward-looking statements in this
Form 10-Q are made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements made
herein contain a number of risks and uncertainties that could cause actual
results to differ materially. These risks and uncertainties include, but
are not limited to, the specific factors impacting the Company's business
discussed under the caption "General," as well as increased competition;
the availability of computer equipment; the ability of the Company to
expand its operations and attract and retain qualified sales
representatives experienced in the purchase, sale and lease of new and used
computer equipment; technological obsolescence of the Company s portfolio
of computer equipment; and general economic conditions.
-9-
<PAGE>
PART II: OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
--------
27. Financial Data Schedule.
(b) Reports on Form 8-K.
-------------------
None.
-10-
<PAGE>
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.
PARAMOUNT FINANCIAL CORPORATION
Date: May 13, 1997 By: /s/ Paul Vecker
------------------------------------
Paul Vecker, Senior Vice President and
Chief Fiancial Officer
-11-
<PAGE>
EXHIBIT INDEX
Exhibit Description
------- -----------
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 5,089
<SECURITIES> 1,897
<RECEIVABLES> 1,046
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 53,273
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 80
<OTHER-SE> 8,163
<TOTAL-LIABILITY-AND-EQUITY> 53,273
<SALES> 936
<TOTAL-REVENUES> 4,046
<CGS> 775
<TOTAL-COSTS> 3,927
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 120
<INCOME-TAX> 48
<INCOME-CONTINUING> 72
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 72
<EPS-PRIMARY> .01
<EPS-DILUTED> 0
</TABLE>
