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)
September 30, 1997
MELLON BANK PREMIUM FINANCE LOAN MASTER TRUST
(Exact name of registrant as specified in charter)
NEW YORK 333-11961 25-0659306
(State or other (Commission File (IRS EmployerIdentification
jurisdiction of Number) Number)
incorporation)
ONE MELLON BANK CENTER, PITTSBURGH, PENNSYLVANIA 15258-0001
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (412) 234-5000
NOT APPLICABLE
(Former name or former address, if changed since last report.)
<PAGE>
Item 5. Other Events
The tables attached hereto as Exhibit 19.1 (the "Updated Tables")
update the tables contained on pages 37 through 41 (the "Original Tables") of
the Mellon Bank Premium Finance Loan Master Trust Prospectus, dated December 12,
1996 (the "Prospectus"), which forms a part of the Registration Statement on
Form S-3, No. 333-11961. The "Geographic Concentration" table appearing on page
38 and 39 of the Prospectus has been updated to reflect the fact that additional
states became Permitted States and that address changes for insureds have
occurred. The table under the caption "Loan Loss Experience" has been updated to
set forth loss experience for the Entire Portfolio for the years ended December
31, 1994, 1995 and 1996 and for the nine month period ending September 30, 1997,
and to set forth loss experience for the Identified Portfolio for the nine month
period ending September 30, 1997. The table under the caption "Loan Delinquency
Experience Following Cancellation" has been updated to add a new table to show
delinquency experience for the Identified Portfolio for the nine month period
ended September 30, 1997. The table under the caption "Originators' Portfolio
Yield" has been updated to add a new table to show portfolio yield information
for the Identified Portfolio for the nine month period ending September 30,
1997. Capitalized but undefined terms used herein have the meanings set forth in
the Prospectus.
MANAGEMENT'S DISCUSSION AND ANALYSIS
The loan loss experience for the Identified Portfolio for the nine
months ended September 30, 1997 is not directly comparable to the loan loss
experience for the Entire Portfolio for the nine months ended September 30, 1997
or prior periods presented. Loans are generally charged off by the Servicer if
uncollected 270 days after cancellation of the related insurance policy. At the
beginning of each period presented, the Entire Portfolio included loans which at
such date were uncollected for a variety of lengths of time after cancellation
of the related insurance policy. Charge-offs generally occurred during each
period as time elapsed and loans remained uncollected for 270 days after policy
cancellation. One of the requirements for loans transferred to the Trust as part
of the Identified Portfolio is that such loans may not be delinquent more than
thirty days. Consequently, the Identified Portfolio, at the beginning of the
period presented (January 1, 1997, approximately two weeks after the initial
transfer of loans to the Trust), contained a substantially smaller proportion of
loans delinquent for more than thirty days than the Entire Portfolio as of the
beginning of any of the periods presented. As a result, charge-offs for the
Identified Portfolio for the period presented were substantially lower, both in
absolute terms and as a percentage of outstanding loans, than charge-offs for
the Entire Portfolio for any of the periods presented.
For the Entire Portfolio, net charge-offs as a percentage of the
average outstanding principal balance increased for the nine months ended
September 30, 1997 as compared to prior periods due to a number of factors.
These factors include lower originations of new loans which, when compared to
charge-offs resulting in part from higher originations in prior periods, have
resulted in a higher percentage of charge-offs; economic pressures affecting the
insurance industry, which have resulted in insurance companies being more
assertive in resisting making unearned premium refunds; the utilization of new
insurance agents and increased extended payment terms, which have resulted in
increased risk of nonpayment; and higher levels of borrower bankruptcies, which
have contributed to increased charge-offs.
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits
EXHIBIT NO.
19.1 Updated Tables
<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.
MELLON BANK PREMIUM FINANCE LOAN MASTER TRUST
(Registrant)
By: AFCO Credit Corporation, on behalf
of Mellon Bank Premium Finance
Loan Master Trust
Date: October 24, 1997 By:/S/ FREDERICK B. OLLETT, III
----------------------------
Name: Frederick B. Ollett, III
Title: Vice President and Chief
Financial Officer
<PAGE>
EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION
19.1 Updated Tables
Exhibit 19.1
AFCO AGGREGATE RECEIVABLES BALANCE BY AMOUNT - IDENTIFIED PORTFOLIO
AS OF 9/30/97
<TABLE>
<CAPTION>
PERCENT OF
PERCENT OF AGGREGATE AGGREGATE
NUMBER OF RECEIVABLE RECEIVABLE
AGGREGATE RECEIVABLES BALANCE NUMBER OF ACCTS ACCTS BALANCE BALANCE
BALANCE
<S> <C> <C> <C> <C>
1. 5,000 or less 40,356 70.90% $65,706,098.61 11.79%
2. 5,000 - 10,000 7,085 12.45% 50,124,386.39 8.99%
3. 10,000 - 25,000 5,682 9.98% 88,165,446.82 15.81%
4. 25,000 - 50,000 2,071 3.64% 71,455,897.06 12.82%
5. 50,000 - 75,000 660 1.16% 40,085,356.09 7.19%
6. 75,000 - 100,000 344 0.60% 29,360,042.05 5.27%
7. 100,000 - 250,000 478 0.84% 70,881,620.15 12.71%
8. 250,000 - 500,000 158 0.28% 54,753,939.53 9.82%
9. 500,000 - 1,000,000 55 0.10% 37,853,675.77 6.79%
10. 1,000,000 - 5,000,000 30 0.05% 49,139,201.29 8.81%
11. Over 5,000,000 0.00 0.00%
Total: 56,919 $557,525,663.76
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AFCO COMPOSITION OF RECEIVABLES BY REMAINING INSTALLMENT TERM -
IDENTIFIED PORTFOLIO
AS IF 9/30/97
PERCENT OF
PERCENT AGGREGATE AGGREGATE
OF NUMBER OF RECEIVABLES RECEIVABLES
REMAINING INSTALLMENT NUMBER OF ACCTS ACCTS BALANCE BALANCE
TERM
<S> <C> <C> <C> <C>
03 Months or Less 22,699 39.88% $81,947,006.05 14.70%
04 to 06 Months 19,905 34.97% 209,432,421.98 37.56%
07 to 09 Months 13,845 24.32% 206,428,745.52 37.03%
10 to 12 Months 320 0.56% 29,558,794.05 5.30%
13 to 18 Months 59 0.10% 10,308,898.42 1.85%
More than 18 Months 91 0.16% 19,849,797.74 3.56%
Total: 56,919 $557,525,663.76
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AFCO GEOGRAPHIC CONCENTRATION - IDENTIFIED PORTFOLIO
AS OF 9/30/97
PERCENTAGE OF
STATES AGGREGATE RECEIVABLES AGGREGATE
BALANCE RECEIVABLES BALANCE
<S> <C> <C>
CALIFORNIA $125,351,709.00 22.48%
TEXAS 73,211,124.91 13.13%
NEW YORK 66,475,233.90 11.92%
FLORIDA 41,918,167.22 7.52%
NEW JERSEY 33,037,251.28 5.93%
PENNSYLVANIA 24,624,709.57 4.42%
MASSACHUSETTS 18,912,593.58 3.39%
WASHINGTON 18,367,924.50 3.29%
ILLINOIS 16,735,244.84 3.00%
GEORGIA 16,259,651.29 2.92%
OHIO 14,034,964.91 2.52%
LOUISIANA 9,481,218.74 1.70%
MICHIGAN 7,712,892.92 1.38%
COLORADO 7,614,887.27 1.37%
SOUTH CAROLINA 7,218,620.22 1.29%
CONNECTICUT 6,989,422.41 1.25%
NORTH CAROLINA 6,877,271.05 1.23%
INDIANA 6,171,079.78 1.11%
MARYLAND 5,509,587.17 0.99%
ALABAMA 5,315,199.50 0.95%
OKLAHOMA 4,839,548.04 0.87%
HAWAII 4,181,356.02 0.75%
ARKANSAS 3,663,269.35 0.66%
WEST VIRGINIA 3,471,077.66 0.62%
KENTUCKY 3,437,805.33 0.62%
ARIZONA 3,411,938.80 0.61%
IDAHO 3,186,333.07 0.57%
MINNESOTA 3,107,504.95 0.56%
NEVADA 3,069,784.65 0.55%
WISCONSIN 2,525,222.98 0.45%
UTAH 2,140,301.67 0.38%
NEBRASKA 1,666,957.17 0.30%
NEW HAMPSHIRE 1,420,083.19 0.25%
MAINE 1,376,677.94 0.25%
RHODE ISLAND 1,017,825.01 0.18%
IOWA 950,297.64 0.17%
MONTANA 791,669.52 0.14%
TENNESSEE 618,368.70 0.11%
WYOMING 296,064.90 0.05%
SOUTH DAKOTA 233,982.87 0.04%
ONTARIO 190,081.64 0.03%
DELAWARE 59,531.02 0.01%
VIRGINIA 14,373.49 0.00%
DISTRICT OF COLUMBIA 12,307.62 0.00%
VERMONT 9,794.00 0.00%
OREGON 5,834.73 0.00%
MISSOURI 3,148.57 0.00%
MISSISSIPPI 2,638.42 0.00%
NORTH DAKOTA 1,210.04 0.00%
ALASKA 914.26 0.00%
NEW MEXICO 729.82 0.00%
KANSAS 276.63 0.00%
Total: $557,525,663.76
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
LOAN LOSS EXPERIENCE
(DOLLARS IN THOUSANDS)
IDENTIFIED ENTIRE PORTFOLIO
PORTFOLIO
------------------------------ -------------------------------------------
NINE MONTHS NINE MONTHS FOR THE YEAR ENDED DECEMBER 31,
ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30, -------------------------------------------
1997 1997 1996 1995 1994
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Average Outstanding Principal Balance $566,887 $925,560 $1,010,105 $1,036,464 $1,105,789
Gross Charge-Offs 357 3,520 4,115 3,230 2,836
Recoveries 6 1,221 2,136 1,153 966
Net Charge-Offs 351 2,299 1,979 2,077 1,870
Net Charge Offs as a Percentage of Average
Aggregate Outstanding Principal Balance 0.08% (1)(2) 0.33%(1) 0.20% 0.20% 0.17%
(1) Calculated on an annualized basis.
(2) It is expected that as the Identified Portfolio matures, its Loan Loss
Experience will more closely reflect that of the Entire Portfolio.
</TABLE>
<PAGE>
LOAN DELINQUENCY EXPERIENCE FOLLOWING CANCELLATION
IDENTIFIED PORTFOLIO
<TABLE>
<CAPTION>
AT SEPTEMBER 30,
1997
Number of days a loan remains overdue
after cancellation of the related insurance
policy
<S> <C>
31-89 days 1.17%
90-270 days 0.71%
Over 270 days (1) 0.00%
------
Total 1.88%
======
(1) A loan is generally written off to the extent it is
uncollected 270 days after the effective date of
cancellation of the related insurance policy.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ORIGINATORS' PORTFOLIO YIELD
IDENTIFIED PORTFOLIO
(DOLLARS IN THOUSANDS)
NINE MONTHS ENDED
SEPTEMBER 30, 1997
---------------------
<S> <C>
Average Outstanding Principal Balance Receivable $566,887
Interest & Fee Income 48,059
Average Revenue Yield 11.30% (1)
(1) Calculated on an annualized basis.
</TABLE>
