SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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)
October 31, 1997
MELLON BANK PREMIUM FINANCE LOAN MASTER TRUST
(Exact name of registrant as specified in charter)
NEW YORK 333-11961 25-0659306
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(State or other (Commission File (IRS Employer Identification
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
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(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 pages
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 ten month period ending October 31, 1997,
and to set forth loss experience for the Identified Portfolio for the ten month
period ending October 31, 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 ten month period
ended October 31, 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 ten month period ending October 31, 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 ten months
ended October 31, 1997 is not directly comparable to the loan loss experience
for the Entire Portfolio for the ten months ended October 31, 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 ten months ended October 31,
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
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(Registrant)
By: AFCO Credit Corporation, on behalf
of Mellon Bank Premium Finance
Loan Master Trust
Date: December 2, 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
<PAGE>
<TABLE>
<CAPTION>
AGG1097 EXHIBIT 19.1
AFCO AGGREGATE RECEIVABLES BALANCE BY AMOUNT - IDENTIFIED PORTFOLIO
AS OF 10/31/97
Aggregate Receivables Balance Number of Acts Percent of Aggregate Percent of
Number of Receivable Aggregate
Accts Balance Receivable
Balance
<S> <C> <C> <C> <C> <C>
1. 5,000 or less 39,529 70.63% $64,191,172.42 11.38%
2. 5,000 - 10,000 6,999 12.51% 49,552,513.12 8.79%
3. 10,000 - 25,000 5,633 10.07% 87,611,112.34 15.54%
4. 25,000 - 50,000 2,095 3.74% 72,542,474.61 12.86%
5. 50,000 - 75,000 669 1.20% 41,019,673.54 7.27%
6. 75,000 - 100,000 291 0.52% 25,055,469.10 4.44%
7. 100,000 - 250,000 507 0.91% 75,391,313.29 13.37%
8. 250,000 - 500,000 152 0.27% 52,656,782.34 9.34%
9. 500,000 - 1,000,000 63 0.11% 43,880,105.56 7.78%
10. 1,000,000 - 5,000,000 25 0.04% 52,028,635.19 9.23%
11. Over - 5,000,000 0.00 0.00%
Total: 55,963 $563,929,251.51
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Term1097
AFCO COMPOSITION OF RECEIVABLES BY REMAINING INSTALLMENT TERM - IDENTIFIED PORTFOLIO
AS OF 10/31/97
Remainint Installment Term Number of Accts Percent Aggregate Percent of
of Number of Receivables Aggregate
Accts Balance Receivables
Balance
<S> <C> <C> <C> <C>
03 Months or Less 22,136 39.55% $87,084,760.47 15.44%
04 to 06 Months 19,414 34.69% 210,415,967.20 37.31%
07 to 09 Months 13,947 24.92% 192,071,227.13 34.06%
10 to 12 Months 310 0.55% 43,187,000.59 7.66%
13 to 18 Months 62 0.11% 9,889,276.36 1.75%
More than 18 Months 94 0.17% 21,281,019.76 3.77%
Total: 55,963 $563,929,251.51
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
GEO1097
AFCO GEOGRAPHIC CONCENTRATION - IDENTIFIED PORTFOLIO
AS OF 10/31/97
States Aggregate Percentage of
Receivables Aggregate
Balance Receivables
Balance
<S> <C> <C>
CALIFORNIA $126,022,062.25 22.35%
TEXAS 74,522,806.07 13.21%
NEW YORK 64,167,002.97 11.38%
FLORIDA 39,416,541.87 6.99%
NEW JERSEY 35,279,470.71 6.26%
PENNSYLVANIA 23,197,423.01 4.11%
ILLINOIS 17,625,862.78 3.13%
GEORGIA 17,587,475.37 3.12%
WASHINGTON 17,580,129.61 3.12%
MASSACHUSETTS 16,928,855.16 3.00%
OHIO 13,137,913.80 2.33%
MICHIGAN 12,879,283.15 2.28%
LOUISIANA 9,120,120.91 1.62%
NORTH CAROLINA 7,593,823.72 1.35%
SOUTH CAROLINA 7,586,417.23 1.35%
COLORADO 7,367,861.59 1.31%
CONNECTICUT 7,121,245.07 1.26%
ARKANSAS 7,069,092.85 1.25%
ALABAMA 6,275,191.95 1.11%
INDIANA 5,339,884.24 0.95%
OKLAHOMA 5,205,595.97 0.92%
MINNESOTA 5,189,528.57 0.92%
MARYLAND 4,751,719.17 0.84%
HAWAII 4,245,109.73 0.75%
ARIZONA 3,658,934.75 0.65%
KENTUCKY 3,460,247.95 0.61%
WEST VIRGINIA 3,384,939.28 0.60%
IDAHO 3,048,514.20 0.54%
NEVADA 2,624,481.27 0.47%
UTAH 2,243,960.61 0.40%
WISCONSIN 2,053,342.69 0.36%
NEBRASKA 1,593,706.62 0.28%
MAINE 1,548,318.54 0.27%
NEW HAMPSHIRE 1,418,629.27 0.25%
RHODE ISLAND 974,541.38 0.17%
MONTANA 793,861.72 0.14%
IOWA 676,270.48 0.12%
VIRGINIA 418,662.51 0.07%
WYOMING 289,704.79 0.05%
SOUTH DAKOTA 228,169.27 0.04%
MISSOURI 129,702.02 0.02%
ONTARIO 121,563.46 0.02%
DELAWARE 29,400.00 0.01%
DISTRICT OF COLUMBIA 13,974.18 0.00%
MISSISSIPPI 2,376.40 0.00%
OREGON 2,129.36 0.00%
ALBERTA 1,247.67 0.00%
NORTH DAKOTA 1,063.16 0.00%
ALASKA 457.13 0.00%
NEW MEXICO 450.63 0.00%
KANSAS 184.42 0.00%
Total: $563,929,251.51
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
LOSS1097
LOAN LOSS EXPERIENCE(1)
(DOLLARS IN THOUSANDS)
Identified
Portfolio Entire Portfolio
---------------- ----------------------------------------------------------
Ten Months Ten Months For the Year Ended December 31,
Ended October 31, Ended October 31, --------------------------------------
1997 1997 1996 1995 1994
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Average Outstanding Principal Balance $564,298 $924,839 $1,010,105 $1,036,464 $1,105,789
Gross Charge-Offs 606 3,918 4,115 3,230 2,836
Recoveries 24 1,328 2,136 1,153 966
Net Charge-Offs 582 2,590 1,979 2,077 1,870
Net Charge Offs as a Percentage of Average
Aggregate Outstanding Principal Balance 0.12%(2) 0.34%(2) 0.20% 0.20% 0.17%
(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.
(2) Calculated on an annualized basis
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
DLNQ1097
LOAN DELINQUENCY EXPERIENCE FOLLOWING CANCELLATION
IDENTIFIED PORTFOLIO
at October 31,
1997
---------------
<S> <C>
Number of days a loan remains overdue after cancellation
of the related insurance policy
31-89 1.28%
days
90-270 days 0.76%
Over 270 days(1) 0.00%
-----
Total 2.04%
=====
(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>
Yield - Identified Portfolio
ORIGINATORS' PORTFOLIO YIELD
IDENTIFIED PORTFOLIO
(DOLLARS IN THOUSANDS)
Ten Months Ended
October 31, 1997
----------------
<S> <C>
Average Outstanding Principal Balance Receivable $564,298
Interest & Fee Income 53,284
Average Revenue Yield 11.33%(1)
(1) Calculated on an annualized basis.
</TABLE>
