SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
Amendment No. 1
(Mark One)
| x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1996
| | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File No.: 333-03574-02
First Union Residential Securitization Transactions, Inc.,
Home Equity Loan Asset-Backed Certificates, Series 1996-2 Trust
(Exact name of registrant as specified in its charter)
North Carolina (governing law of pooling and servicing agreement)
State or other jurisdiction of incorporation or organization)
52-2010590
(I.R.S. Employer Identification No.)
c/o Norwest Bank Minnesota, N.A.
7485 New Horizon Way
Frederick, MD 21703
(Address of principal executive (Zip Code)
offices)
Registrant's telephone number, including area code (301)696-7900
Securities registered pursuant to Section 12(b) of the Act: NONE
Securities registered pursuant to Section 12(g) of the Act: NONE
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
This Amendment No. 1 on Form 10-K/A amends Item 14 of the original Annual
Report on Form 10-K (the "Original Form 10-K") filed on March 28, 1997, by
Norwest Bank Minnesota, N.A. (the "Reporting Person"), on behalf of First Union
Residential Securitization Transactions, Inc., Home Equity Loan Asset-Backed
Certificates, Series 1996-2 Trust (the "Trust"), established pursuant to a
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement") among
Norwest Asset Securities Corporation, (the "Company"), as depositor, a trustee
and a master servicer (or, if applicable, a servicer) and in some instances, a
certificate administrator, pursuant to which the First Union Residential
Securitization Transactions, Inc., Home Equity Loan Asset-Backed Certificates,
Series 1996-2 registered under the Securities Act of 1933 (the "Certificates")
were issued. Item 14 of the Original Form 10-K is amended to read in its
entirety as follows:
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.
(a) Exhibits
In accordance with the no action letter from the Office of Chief
Counsel of the Division of Corporate Finance, Securities and Exchange
Commission dated December 17, 1996 (the "No Action Letter"), the
following exhibits are or will be provided:
99.1 Annual Independent Accountants' Servicing Reports concerning
servicing activities under the Pooling and Servicing Agreements
for the year ended December 31, 1996, in accordance with the
Exemption Request.
(a) First Union National Bank of North Carolina, as
Servicer and Master Servicer<F1>
99.2 Report of Management as to Compliance with Minimum Servicing
Standards for the year ended December 31, 1996, in accordance
with the Exemption Request.
(a) First Union National Bank of North Carolina, as
Servicer and Master Servicer<F1>
99.3 Annual Statements of Compliance under the Pooling and Servicing
Agreements for the year ended December 31, 1996, in accordance
with the Exemption Request.
(a) First Union National Bank of North Carolina, as
Servicer and Master Servicer<F1>
99.4 Aggregate Statement of Principal and Interest Distributions to
Certificate Holders.<F2>
(b) On or about November 18, 1996, and November 22, 1996, reports on Form
8-K were filed in order to provide settlement information for the
Certificates.
(c) Not applicable.
(d) Omitted pursuant to the Exemption request.
<F1> Filed herewith.
<F2> Previously filed.
SIGNATURE
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:
FIRST UNION RESIDENTIAL SECURITIZATION TRANSACTIONS, INC.
HOME EQUITY LOAN ASSET-BACKED CERTIFICATES, SERIES 1996-2 TRUST
By: NORWEST BANK MINNESOTA, N.A.,
as Trustee
By: /s/Sherri J. Sharps
By: Sherri J. Sharps
Title: Vice President -- Securities Administration Services
Dated: September 5, 1997
EXHIBIT INDEX
Exhibit No.
99.1 Annual Independent Accountants' Servicing Reports concerning servicing
activities under the Pooling and Servicing Agreements for the year ended
December 31, 1996, in accordance with the Exemption Request.
(a) First Union National Bank of North Carolina, as Servicer and Master
Servicer<F1>
99.2 Report of Management as to Compliance with Minimum Servicing Standards for
the year ended December 31, 1996, in accordance with the Exemption Request.
(a) First Union National Bank of North Carolina, as Servicer and Master
Servicer<F1>
99.3 Annual Statements of Compliance under the Pooling and Servicing Agreements
for the year ended December 31, 1996, in accordance with the Exemption
Request.
(a) First Union National Bank of North Carolina, as Servicer and Master
Servicer<F1>
99.4 Aggregate Statement of Principal and Interest Distributions to Certificate
Holders.<F2>
<F1> Filed herewith.
<F2> Previously filed.
KPMG Peat Marwick LLP
Suite 2800
Two First Union Center
Charlotte, NC 28282-8290
Independent Accountants' Report
The Board of Directors
First Union National Bank of North Carolina:
We have examined management's assertion about First Union National Bank of North
Carolina Master Servicing Division's (the Company) compliance with the minimum
servicing standards identified in the Mortgage Bankers Association of America's
UNIFORM SINGLE ATTESTATION PROGRAM FOR MORTGAGE BANKERS (the USAP) as of and for
the year ended December 31, 1996 included in the accompanying management
assertion. In as much as the Company does not service the loans underlying the
master servicing directly, our procedures relative to minimum servicing
standards I.4., II.1, II.2., II.3., II.4., III.2., III.3., III.4., III.6., V.1.,
V.2., V.3., V.4., and VI.1. of the USAP, involved obtaining and reading the most
recently available reports from the primary servicers' independent auditors. Our
opinion as expressed herein, insofar as it relates to such minimum servicing
standards performed by such primary servicers, is based solely upon the reports
of the respective independent auditors. Management is responsible for the
Company's compliance with those minimum servicing standards. Our responsibility
is to express an opinion on management's assertion about the Company's
compliance based on our examination.
Our examination was made in accordance with standards established by the
American Institute of Certified Public Accountants and, accordingly, included
examining, on a test basis, evidence about the Company's compliance with the
minimum servicing standards and performing such other procedures as we
considered necessary in the circumstances. We believe that our examination
provides a reasonable basis for our opinion. Our examination does not provide a
legal determination on the Company's compliance with the minimum servicing
standards.
In our opinion, management's assertion that, except for noncompliance by the
Company relating to custodial bank account reconciliations and various
noncompliance with minimum servicing standards by certain of it's primary
servicers noted from reading other independent auditors' reports, the Company
complied with the aforementioned minimum servicing standards as of and for the
year ended December 31, 1996, is fairly stated, in all material respects.
/s/KPMG Peat Marwick LLP
April 28, 1997
Member Firm of
KPMG International
FIRST UNION NATIONAL BANK
OF NORTH CAROLINA
301 South College Street, TW6
Charlotte, North Carolina 28288-0828
800 786-8919
Fax 704 383-0387
(logo)FIRST UNION
MANAGEMENT ASSERTION
As of and for the year ended December 31, 1996, except as noted in the following
paragraphs, First Union National Bank of North Carolina's Master Servicing
Division (the Company) has complied in all material respects with the minimum
servicing standards for master servicers set forth in the Mortgage Bankers
Association of America's UNIFORM SINGLE ATTESTATION PROGRAM FOR MORTGAGE BANKERS
(USAP). With respect to minimum servicing standards I.4., II.1, II.2., II.3.,
II.4., III.2., III.3., III.4., III.6., V.1., V.2., V.3., V.4., and VI.1. as set
forth in such program, the Company relies on the performance of its primary
servicers. There were instances of noncompliance with minimum servicing
standards by primary servicers noted in the most recently received independent
auditors reports for several primary servicers. These instances of noncompliance
are discussed below.
From July to December 1996, the Company was not in full compliance with USAP
standard I.1, relating to reconciliations of custodial bank accounts, including
the preparation of the reconciliations within 45 calendar days of the cutoff
date and the identification of all reconciling items. The noncompliance was
primarily concentrated in 18 of the Company's 157 custodial bank accounts. Since
January 1997, the Company has worked diligently to properly reconcile all
affected accounts and all accounts are currently being reconciled in a timely
manner with only certain pre-1997 unidentified reconciling items existing. Based
on the method that the Company uses to calculate investor remittances, it is
management's belief that the custodial bank account noncompliance did not affect
the accuracy of any amounts remitted to trustees or investors and should not
affect any trustee or investor in any manner. Once management believes that all
custodial bank accounts have been completely reconciled, which is expected to be
by May 31, 1997, we plan to engage our external auditors, KPMG Peat Marwick LLP,
to perform an interim 1997 examination of the USAP standard relating to
custodial bank account reconciliations. We will make this report available upon
request.
As discussed above, with respect to minimum servicing standards I.4., II. 1,
II.2., II.3., II.4., III.2., III.3., III.4., III.6., V.1., V.2., V.3., V.4., and
VI.1. of the USAP, the Company relies on the performance of its primary
servicers. As part of our on-going monitoring of the primary servicers, the
Company obtains independent accountant's reports regarding those companies'
compliance with minimum servicing standards. The Company's readings of the most
recently available reports noted certain instances of noncompliance by primary
servicers that are reported below:
Instances of exceptions with respect to the Company's approximately 190 primary
servicers were:
- - Custodial Bank Accounts (USAP standard I.1.) - five primary servicers
- - Unissued Checks (III.6.) - one primary servicer
- - Escrow Account Analysis (V.3.) - two primary servicers
- - Delinquencies (VI.1.) - four primary servicers
- - The Company does not have current USAP's for primary servicers
comprising approximately 16% of the master servicing portfolio, therefore,
we could not review the most recently available reports.
The Company has a process in place to review the financial soundness and
servicing performance of primary servicers on an annual basis. Among other
factors, the Company considers the results of the primary servicers' USAP
reports in these reviews and takes appropriate corrective actions where it is
warranted. The Company is currently in the process of obtaining the most current
USAP's for those primary-servicers for which it has not yet been received.
As of and for this same period, the Company had in effect fidelity bond and
errors and omissions insurance policies in the amount of $100 million and $20
million, respectively.
/s/Karl J. Mendenhall 4/28/97 /s/Anthony J. Gagliardo 4/28/97
Karl J. Mendenhall Date Anthony J. Gagliardo Date
Senior Vice President Vice President
Master Servicing Master Servicing
/s/Bruce W. Good 4/28/97 /s/John M. Church 4/28/97
Bruce W. Good Date John M. Church Date
Assistant Vice President Senior Vice President
Master Servicing Structured Servicing Products
First Union National Bank
of North Carolina
Master Servicing Division
301 South College Street, TW9
Charlotte, North Carolina 28288-0828
704 374-2487
Fax 704 383-0387
Toll Free 800 786-9819
April 7, 1997
(logo)FIRST UNION
Norwest Bank Minnesota, NA
11000 Broken Land Parkway
Columbia, MD 21044
Attention: Michael L. Mayer
Re: Pooling and Servicing Agreement dated and effective as of December 1,
1996 (the "Agreement") for Home Equity Loan Asset-Backed Certificates,
Series 1996-2
Ladies and Gentlemen:
Pursuant to the provisions of the Agreement, I, Anthony J. Gagliardo, Vice
President of First Union National Bank of North Carolina do hereby certify as
follows:
1. A review of the activities of First Union National Bank of North
Carolina (the "Master Servicer") during the period from December
1,1996 through December 31, 1996 and of its performance under the
Agreement has been made under my supervision; and
2. To the best of my knowledge, based on such review, the Master Servicer
has fulfilled all of its obligations under the Agreement in all
material respects throughout such period.
IN WITNESS WHEREOF, I have hereunto set my hand this 7th day of April,
1997.
/s/Anthony J. Gagliardo
Anthony J. Gagliardo
Vice President
First Union Nationa1 Bank
of North Carolina
