<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
Form 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 1996
Commission file number 1-4976
USL Capital Corporation
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 94-1360891
------------------------ ------------------------------------
(State of Incorporation) (I.R.S. Employer Identification No.)
733 Front Street, San Francisco, California 94111
------------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(415) 627-9000
----------------------------------------------------
(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 [ ]
As of November 11, 1996, the Registrant had outstanding 10 shares of
Common Stock, all of which were owned by Ford Holdings, Inc.
THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION
H(1)(a) AND (b), AND IS THEREFORE FILING THIS FORM 10-Q WITH REDUCED DISCLOSURE
FORMAT.
<PAGE> 2
USL CAPITAL CORPORATION
AND SUBSIDIARY COMPANIES
I N D E X
<TABLE>
<CAPTION>
Page No.
<S> <C>
Part I - Financial Information:
Item 1. Financial Statements
Consolidated Balance Sheets --
September 30, 1996 and December 31, 1995................................3
Consolidated Statements of Income --
Three and nine months ended September 30, 1996 and 1995.................4
Condensed Consolidated Statements of Cash Flows
Nine months ended September 30, 1996 and 1995...........................5
Notes to Condensed Consolidated Financial Statements.....................6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations............................7
Part II - Other Information:
Item 6. Exhibits and Reports on Form 8-K........................................11
Signatures..............................................................12
</TABLE>
<PAGE> 3
USL CAPITAL CORPORATION
AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
(UNAUDITED)
SEPTEMBER 30, DECEMBER 31,
(IN THOUSANDS) 1996 1995
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Cash and equivalents $ 6,741 $ 11,474
Investment in finance leases 7,870 2,548,944
Notes receivable 20,819 1,039,597
Investment in operating leases 1,282 904,391
Investment in leveraged leases 30,124 438,504
Investment in securities 70,487 1,064,841
Inventory held for sale or lease 24,425 107,514
Other receivables 4,582 21,759
Investment in associated companies 4,155 17,215
Other receivables from Ford and affiliates - net 124,267 0
Office facilities at cost less accumulated depreciation 1,778 8,741
Goodwill 0 177,551
Other assets 12,838 20,231
------------ ------------
Total assets $ 309,368 $ 6,360,762
============ ============
LIABILITIES
Short-term notes payable $ 0 $ 1,417,754
Accounts payable 8,399 83,849
Accrued liabilities and lease deposits 146,708 205,186
Payable to Ford and affiliates 0 109,557
Deferred taxes on income 67,427 534,925
Long-term debt 3,177,698 3,171,637
------------ ------------
Total liabilities 3,400,232 5,522,908
------------ ------------
COMMITMENTS AND CONTINGENCIES - -
SHAREHOLDER'S EQUITY
Common stock * *
Additional capital 549,904 521,425
Net unrealized (loss) on available-for-sale securities 0 (3,782)
Retained earnings 517,970 320,211
------------ ------------
1,067,874 837,854
Notes receivable from affiliates (4,158,738) 0
------------ ------------
Total shareholder's equity (3,090,864) 837,854
------------ ------------
Total liabilities and shareholder's equity $ 309,368 $ 6,360,762
============ ============
* Less than one thousand dollars
- ----------------------------------------------------------------------------------------------
</TABLE>
See NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
3
<PAGE> 4
USL CAPITAL CORPORATION
AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF INCOME
<TABLE>
<CAPTION> THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
-------------------------- ------------------------
(UNAUDITED; IN THOUSANDS) 1996 1995 1996 1995
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
REVENUES
From operations $ 125,622 $ 168,221 $ 505,331 $ 488,444
Gain from sale of business unit assets 273,305 0 273,305 0
--------- --------- --------- ---------
Total revenues 398,927 168,221 778,636 488,444
--------- --------- --------- ---------
EXPENSES
Sales, administrative and general 16,351 17,035 52,263 50,955
Interest 55,873 70,683 209,645 204,761
Depreciation -- operating leases 26,497 28,377 92,042 86,770
Other 5,413 7,180 19,392 19,867
--------- --------- --------- ---------
Total expenses 104,134 123,275 373,342 362,353
--------- --------- --------- ---------
Income before taxes on income 294,793 44,946 405,294 126,091
Taxes on income 177,483 13,651 207,536 39,291
--------- --------- --------- ---------
NET INCOME $ 117,310 $ 31,295 $ 197,758 $ 86,800
========= ========= ========= =========
- ---------------------------------------------------------------------------------------------------------
</TABLE>
See NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
4
<PAGE> 5
USL CAPITAL CORPORATION
AND SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,
--------------------------------
(UNAUDITED; IN THOUSANDS) 1996 1995
- ------------------------------------------------------------------------------------------
<S> <C> <C>
Net cash flows from operating activities $ (738,338) $ 248,054
------------ ----------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of receivables 5,661,104 -
Recovery of equipment costs and residual interests 482,359 526,436
Cost of equipment acquired for lease (774,686) (824,685)
Notes receivable investments (242,561) (215,828)
Collections on notes receivable investments 294,993 145,948
Purchase of held-to-maturity securities (42,020) (60,629)
Maturity of held-to-maturity securities 28,365 41,185
Purchase of available-for-sale securities (79,435) (162,773)
Sale and maturity of available-for-sale securities 920,418 14,804
Purchase of other equity securities not
subject to SFAS 115 (116,098) (57,679)
Sales of other equity securities not subject to SFAS 115 245,004 -
Increase in deferred initial direct costs (8,833) (9,622)
Other 7,290 (7,634)
------------ ----------
Net cash provided by/(used in) investing activities 6,375,900 (610,477)
------------ ----------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term borrowings 480,580 556,765
Long-term debt repaid (474,519) (343,684)
Net (decrease)/increase in short-term borrowings (1,417,754) 259,308
Net increase in notes receivable from affiliates (4,159,790) -
Capital contribution from parent 28,479 -
(Decrease) in funds collected for affiliates (59,291) -
Dividend to parent (40,000) (100,000)
------------ ----------
Net cash (used in)/provided by financing activities (5,642,295) 372,389
------------ ----------
(Decrease)/increase in cash and equivalents (4,733) 9,966
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD 11,474 16,226
------------ ----------
CASH AND EQUIVALENTS AT END OF PERIOD $ 6,741 $ 26,192
============ ==========
SUPPLEMENTAL SCHEDULE OF CASH FLOW INFORMATION
Interest paid $ 200,450 $ 189,752
Income taxes paid 298 488
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND
FINANCING ACTIVITIES
Accrued interest on bond accretion and notes
receivable added to principal $ 2,192 $ 5,744
Lease equipment and notes receivable transferred
to inventory held for sale or lease 20,092 3,972
Fair market value adjustment on available-for-sale
securities (6,203) 7,952
Deferred and commitment fees transferred to notes
receivable 1,914 -
- ------------------------------------------------------------------------------------------
</TABLE>
See NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
5
<PAGE> 6
USL CAPITAL CORPORATION
AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The accompanying unaudited condensed financial statements reflect all
adjustments (consisting only of normal recurring adjustments) which are, in the
opinion of management, necessary for a fair statement of the results for the
interim periods. The results of operations for such interim periods are not
necessarily indicative of results of operations for a full year. The December
31, 1995 consolidated balance sheet included herein is derived from the audited
financial statements included in the Company's annual report on Form 10-K for
the year ended December 31, 1995, but does not include all disclosures required
by generally accepted accounting principles. The statements should be read in
conjunction with the significant accounting policies and notes to consolidated
financial statements included in the Form 10-K for the year ended December 31,
1995. Certain amounts have been reclassified to conform to the 1996
presentation.
The Company is a wholly-owned subsidiary of Ford Holdings, Inc., the
common stock of which is owned by Ford Motor Company ("Ford") and Ford Motor
Credit Company ("Ford Credit"), a wholly-owned subsidiary of Ford.
2. IMPAIRMENT OF LONG-LIVED ASSETS
The Company adopted Statement of Financial Accounting Standards
("SFAS") No. 121, "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to Be Disposed Of", effective January 1, 1996. The effect on
the Company's financial statements was not material.
3. DISCONTINUED OPERATIONS AND INVESTMENT OF PROCEEDS
Effective September 30, 1996, essentially all of the operating assets
of the Company have been sold. See Management's Discussion and Analysis
beginning on page 7, for specific details. As noted in the discussion, Ford
Credit, an SEC registrant, has become co-obligor on the Company's $3.2 billion
of outstanding long-term debt; net proceeds from the sale of operating assets
have been invested in notes receivable from Ford Credit and Ford Holdings, Inc.
In accordance with requirements of the SEC, these notes receivable have been
reflected as a contra to Shareholder's Equity for purposes of presentation in
the Consolidated Balance Sheet included in this form 10-Q. The amount reflected
as a contra will be reduced as payments are made against the notes.
6
<PAGE> 7
USL CAPITAL CORPORATION
AND SUBSIDIARY COMPANIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Pursuant to General Instructions H(2)(a), the following narrative
analysis is presented in lieu of Management's Discussion and Analysis of
Financial Condition and Results of Operations.
RESULTS OF OPERATIONS
Revenues, Expenses and Operating Profit
<TABLE>
<CAPTION>
Nine Months Ended 1996 vs. 1995
September 30, Increase/(Decrease)
-------------------- ----------------------
(In thousands) 1996 1995 Amount %
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenues
Gain on business unit sales $ 273,305 $ 0 $ 273,305 -%
From operations 505,331 488,444 16,887 3
--------- --------- --------- ----
Total revenues 778,636 488,444 290,192 59
--------- --------- --------- ----
Expenses
Sales, admin. & general 52,263 50,955 1,308 3
Interest 209,645 204,761 4,884 2
Depreciation 92,042 86,770 5,272 6
Other expenses 19,392 19,867 (475) (2)
--------- --------- --------- ----
Total expenses 373,342 362,353 10,989 3
--------- --------- --------- ----
Operating Profit $ 405,294 $ 126,091 $ 279,203 221%
========= ========= ========= ====
</TABLE>
Business Unit Sales
As previously reported, Ford decided to sell the Company's business units
individually to achieve the highest value for the Company's assets. During the
third quarter of 1996, the Company completed the sale of approximately 98% of
the consolidated assets for proceeds totaling $6.9 billion. These transactions
resulted in a gain of $273 million before taxes and $101 million after taxes,
including the write-off of $126 million of goodwill.
On July 1, 1996, the Company completed the sale of its Fleet Services
business unit to Associates Commercial Corporation, a subsidiary of Associates
First Capital Corporation, for $869 million. Ford indirectly owns over 80% of
the outstanding stock of Associates First Capital Corporation. The Company's
Fleet Services business included more than 100,000 owned or managed vehicles
and 1,850 commercial customers. Fleet Services represented 12% of the
Company's earning assets as of June 30, 1996.
On July 31, 1996, the Company completed the sale of its Rail Services
business unit to First Union Corporation for $922 million, subject to
post-closing adjustments. The Company's Rail Services business included over
26,000 rail cars and represented 12% of the Company's earning assets as of June
30, 1996.
On September 20, 1996 and September 30, 1996, the Company completed the
sale of approximately 98% of the Company's Transportation and Industrial
Financing business unit to BA Leasing and Capital
7
<PAGE> 8
Corporation and Security Pacific Leasing Corporation, affiliates of BankAmerica
Corporation, for $1.6 billion. It is anticipated that the remainder of the
portfolio will be sold by December 31, 1996, subject to receipt of the required
consents. The Transportation and Industrial Financing portfolio consisted
primarily of leases on aircraft, rail, marine and other industrial equipment
and machinery, and represented 25% of the Company's earning assets as of June
30, 1996.
On September 30, 1996, the Company completed the sale of its Business
Equipment Financing business unit to Mellon Bank, N.A. for $1.7 billion,
subject to post-closing adjustments. The Business Equipment Financing business
is a middle-market equipment leasing and financing provider with transactions
ranging from $250,000 to $10 million, and represented 22% of the Company's
earning assets as of June 30, 1996.
As of September 30, 1996, in addition to the above sales, the Company had
completed the sale of (i) the Real Estate Financing business unit's mortgages
to Bankers Trust Company for $496 million as well as two of its foreclosed real
estate assets; and (ii) $1.3 billion of the assets of the Municipal and
Corporate Financing business unit. As of June 30, 1996, the Real Estate
Financing business unit and the Municipal and Corporate Financing business unit
represented 8% and 21%, respectively, of the Company's earning assets.
All of the above sales were the result of a competitive bidding process.
In order to hedge against changes in the price of certain assets being
sold as a result of movements in interest rates, the Company entered into two
interest rate swap agreements. One agreement was for two years with a notional
amount of $1.525 billion and the other was a ten year agreement with a notional
value of $600 million. The Company terminated and settled these agreements
when the assets were sold in September 1996.
On July 29, 1996, the Company received the requisite number of consents
from its bondholders to make certain amendments in certain provisions of the
debt agreements covering all $3.2 billion of the Company's outstanding
long-term debt. On July 31, 1996, the Company and Ford Credit executed
supplemental indentures whereby Ford Credit became a co-obligor with the
Company on all such debt. In connection with Ford Credit's becoming co-obligor
on the Company's debt agreements, the Company intended that cash proceeds from
sales of assets would be loaned to Ford Credit in an amount up to the
outstanding debt.
As a result of the above, and the fact that the Company does not intend to
incur any additional third party debt, the Company canceled all existing bank
lines, effective August 2, 1996. The Company used the proceeds from the sales
of assets to (1) pay down related liabilities, (2) repay all outstanding
short-term borrowings and (3) loan $3.2 billion to Ford Credit. The remaining
excess funds, approximately $975 million at September 30, 1996, were loaned to
Ford Holdings.
The Company intends to sell its remaining assets and fully eliminate its
staff during the 1996 fourth quarter. It is intended that any remaining
obligations, after December 31, 1996, will be managed by various Ford
affiliates.
Revenues from operations
Consolidated revenues from operations increased $17 million or 3% during
the first nine months of 1996. Average earning assets are down 7% when
compared to 1995. The increased revenues result from a $16 million increase in
gain on asset sales from operations, primarily in the Municipal and Corporate
Financing, the Transportation and Industrial Financing and the Rail Services
business units.
Expenses
Total expenses for the first nine months of 1996 increased $11 million or
3%, and are discussed below.
8
<PAGE> 9
Sales, administrative and general expenses increased $1 million or 3% in
the first nine months of 1996. The increase is a result of higher expenses to
support the increase in the portfolio of earning assets through June 30, 1996,
as compared to prior periods and normal inflationary increases offset in part
by improved operating cost performance and the reduction in the total number of
employees associated with the 1996 third quarter business unit sales.
Interest expense increased $5 million or 2% for the nine-month period,
reflecting an increase during the period in average borrowings from $3.98
billion in 1995 to $4.33 billion in 1996 to finance the growth in earning
assets. This increase was offset in part by a decrease in borrowing rates,
which averaged 6.5% in the first nine months of 1996 compared to 6.9% in the
1995 period.
Depreciation expense on operating lease equipment increased $5 million or
6% in the 1996 nine-month period, resulting from the 21% or $230 million
increase through June 30, 1996 in the average investment in the cost of
operating lease equipment compared to a year ago. Of the increase in operating
lease equipment prior to the business unit sales, railcars in the Rail Services
business unit, which have longer useful lives and depreciate more slowly than
other operating lease equipment, increased $180 million or 37%.
Other Expenses decreased $1 million or 2% in the 1996 first nine months.
Provision for losses increased $5 million (see Credit loss experience). This
was offset by a decrease in operating lease expenses of approximately $6
million, primarily as a result of a decline in maintenance expense due to the
sale of the Rail Services business unit.
Income before taxes on income
Based upon the discussion above, operating profit for the first nine
months of 1996 improved $279 million or 221% ($6 million or 5% exclusive of the
gain on business unit sales) compared with the first nine months of 1995
results.
Taxes on income
Income tax expense was 51.2% of income before taxes in the 1996 nine-month
period compared with 31.2% in the same 1995 period. The higher effective tax
rate of 51.2% includes the effect of writing-off $126 million of goodwill,
which is not tax deductible. Exclusive of the taxes related to the gain on the
business unit sales, income tax expense was 27.0% of income before taxes
compared with 31.2%. This decrease is primarily a result of the effect on the
1996 expense of tax benefits associated with the Company's investments in
qualified low income housing transactions.
9
<PAGE> 10
GENERAL
Credit loss experience
The management of credit exposure has been an important element of the
Company's business. The Company established appropriate loss allowances,
reviewed delinquent receivables and wrote down receivables to expected
realizable value when they became uncollectible.
The table below shows certain information on the Company's allowance for
doubtful accounts that reflect primarily prior periods activity and the effect
of the sale of the Company's assets:
<TABLE>
<CAPTION>
<S> <C>
NINE MONTHS ENDED TWELVE MONTHS ENDED
SEPTEMBER 30, DECEMBER 31,
-------------------- --------------------
1996 1995 1995
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Allowance for doubtful accounts (in millions)
Beginning balance $ 60 $ 58 $ 58
Provision 10 5 6
Charge-offs - net (15) (3) (4)
Other reduction - sold assets (54) - -
------- ------- -------
Ending balance $ 1 $ 60 $ 60
======= ======= =======
Percent of earning assets 0.6% 1.1% 1.0%
Total balance of accounts receivable over
90 days past due at period end (in millions) $ 0 $ 28 $ 23
Percent of earning assets - 0.5% 0.4%
Total earning assets (in millions)
Investment in finance leases - net $ 8 $ 2,457 $ 2,549
Investment in operating leases - net 1 779 904
Investment in leveraged leases - net 30 375 438
Notes receivable 21 918 1,040
Investment in securities 71 930 1,065
Inventory held for sale or lease 24 82 108
Investment in associated companies 4 18 17
------- ------- -------
Total $ 159 $ 5,559 $ 6,121
======= ======= =======
</TABLE>
The delinquencies over 90 days past due at December 31, 1995 included a $10
million note, which was collateralized by an office/retail complex. Foreclosure
on the complex was completed in March 1996. Also delinquent over 90 days past
due at December 31, 1995 was a $10 million subordinated note, the balance of
which was written off in the 1996 third quarter. The $12 million increase in
charge-offs when compared to the first nine months of 1995, reflects this credit
loss. The majority of the remaining 1995 delinquencies were included in the
sale of business unit assets in the 1996 third quarter. Additions to the
provision increased $5 million when compared to the first nine months of 1995,
as a result of management's evaluation of the adequacy of the allowance for
doubtful accounts.
10
<PAGE> 11
Earning assets by business unit
The table below summarizes the earning assets by business unit as a
percentage of the total.
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
--------------- ------------
1996 1995 1995
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Business Equipment Financing 0% 23% 23%
Transportation and Industrial Financing 60 26 26
Fleet Services 0 11 11
Municipal and Corporate Financing 23 20 20
Real Estate Financing 15 9 8
Rail Services 0 11 12
Other 2 - -
---- ---- ----
Total 100% 100% 100%
==== ==== ====
</TABLE>
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
12. Computation of ratio of earnings to fixed
charges.
27. Financial Data Schedule
(b) Reports on Form 8-K.
The registrant filed the following report on Form 8K:
On or about September 20, 1996, the Registrant
reported under
Item 2 - The completion of the sale of approximately
98% of Registrant's Transportation and
Industrial Financing business unit to BA
Leasing and Capital Corporation and Security
Pacific Leasing Corporation, affiliates of
BankAmerica Corporation. In addition, the
completion of the sale of the Registrant's
Business Equipment Financing unit to Mellon
Bank and the Real Estate Financing business
unit's mortgages to Bankers Trust Company.
11
<PAGE> 12
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.
USL CAPITAL CORPORATION
November 14, 1996 By: /s/ Joseph J. Mahoney
- -------------------------- -----------------------------------
Date Joseph J. Mahoney
Senior Vice President and
Chief Financial Officer
November 14, 1996 By: /s/ Robert A. Keyes, Jr.
- -------------------------- -----------------------------------
Date Robert A. Keyes, Jr.
Vice President, Corporate Controller
12
<PAGE> 1
Exhibit 12
USL CAPITAL CORPORATION
AND SUBSIDIARY COMPANIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
--------------------- ----------------------
(UNAUDITED; IN THOUSANDS) 1996 1995 1996 1995
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
EARNINGS:
Income before taxes on income per statement of income $ 294,793 $ 44,946 $ 405,294 $ 126,091
Add
Fixed charges 56,243 71,413 211,317 206,913
Distributions and proceeds in excess of
net income of associated companies 217 151 1,284 363
--------- -------- --------- ---------
Income as adjusted $ 351,253 $ 116,510 $ 617,895 $ 333,367
========= ========= ========= =========
FIXED CHARGES:
Interest on indebtedness including amortization of debt
issue costs and discount or premium thereon $ 55,873 $ 70,683 $ 209,645 $ 204,761
Interest factor of annual rentals(1) 370 730 1,672 2,152
--------- -------- --------- ---------
Fixed charges $ 56,243 $ 71,413 $ 211,317 $ 206,913
========= ========= ========= =========
Ratio of earnings to fixed charges 6.2 1.6 2.9 1.6
========= ========= ========= =========
</TABLE>
(1) The interest portion of annual rentals is estimated to be one-third
of such rentals.
13
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 6,741
<SECURITIES> 70,487
<RECEIVABLES> 64,677
<ALLOWANCES> 587
<INVENTORY> 24,425
<CURRENT-ASSETS> 0
<PP&E> 1,778
<DEPRECIATION> 0
<TOTAL-ASSETS> 309,368
<CURRENT-LIABILITIES> 0
<BONDS> 3,177,698
0
0
<COMMON> 0
<OTHER-SE> (3,090,864)
<TOTAL-LIABILITY-AND-EQUITY> 309,368
<SALES> 778,636
<TOTAL-REVENUES> 778,636
<CGS> 0
<TOTAL-COSTS> 101,389
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 10,045
<INTEREST-EXPENSE> 209,645
<INCOME-PRETAX> 405,294
<INCOME-TAX> 207,536
<INCOME-CONTINUING> 197,758
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 197,758
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
