SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One)
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1999
OR
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD
FROM__________TO__________
Commission file number 1-14103
NB CAPITAL CORPORATION
(Exact name of registrant as specified in its charter)
Maryland 52-2063921
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
125 West, 55th Street, New York, New York 10019
(Address of principal executive offices) (Zip Code)
212-632-8532
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year,
if changed since last report)
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 ____
Applicable only to issuers involved in bankruptcy proceedings during the
preceding five years:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by the court.
Yes ______ No ______
Applicable only to corporate issuers:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at November 15, 1999
Common Stock
par value $0.01 per share 100
<PAGE>
NB CAPITAL CORPORATION
Index
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Page
----
Part I. FINANCIAL INFORMATION:
Item 1. Financial Statements
Balance Sheet -
As of September 30, 1999 and December 31, 1998 1
Statement of Income -
For the three and nine-month period ended
September 30, 1999 and 1998 2
Statement of Stockholders' Equity -
For the three and nine-month period ended
September 30, 1999 and 1998 3
Statement of Cash Flows -
For nine-month period ended September 30, 1999 and 1998 4
Notes to the financial statements 5
Item 2. Management's Discussion and Analysis of Financial Conditions
and Results of Operations 8
Part II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 11
- --------------------------------------------------------------------------------
This report contains certain forward-looking statements and information relating
to NB Capital Corporation (the "Company" or "NB Capital") that are based on the
beliefs of the Company's management as well as assumptions made by and
information currently available to the Company's management. When used in this
report, the words "anticipate", "believe", "estimate", "expect" and similar
expressions, as they relate to the Company or the Company's management, are
intended to identify forward-looking statements. Such statements reflect the
current view of the Company's management with respect to future events and the
Company's future performance and are subject to certain risks, uncertainties and
assumptions. Should management's current view of the future or underlying
assumptions prove incorrect, actual results may vary materially from those
described herein as anticipated, believed, estimated or expected. The Company
does not intend to update these forward-looking statements.
References to $ are to United States dollars; references to C$ are to Canadian
dollars. As of September 30, 1999, the Canadian dollar exchange rate was
C$1.4674 = $1.00 and certain amounts stated herein reflect such exchange rate.
<PAGE>
NB CAPITAL CORPORATION
BALANCE SHEET
September 30, December 31,
(in US dollars) 1999(1) 1998
- --------------------------------------------------------------------------------
Assets
Cash equivalents $ 25,441,394 $ 22,178,668
Due from an affiliated company 14,209,752 8,667,391
Promissory notes 450,767,589 451,899,957
Accrued interest on cash equivalents 7,169 --
---------------------------------------------------------------------------
$ 490,425,904 $ 482,746,016
===========================================================================
Liabilities
Due to parent company $ 308,763 $ 303,777
Dividend payable 0 500,000
Accounts payable 136,212 33,857
---------------------------------------------------------------------------
444,975 837,634
===========================================================================
Stockholders' equity
Preferred stock, $0.01 par value per share;
10,000,000 shares authorized,
110 Senior preferred shares
issued and paid 1 1
300,000 Series A shares
issued and paid 3,000 3,000
Common stock, $0.01 par value per share;
1,000 shares authorized,
100 shares issued and paid 1 1
Additional paid-in capital 476,761,014 476,761,014
Retained earnings 13,216,913 5,144,366
---------------------------------------------------------------------------
489,980,929 481,908,382
---------------------------------------------------------------------------
$ 490,425,904 $ 482,746,016
===========================================================================
- --------------------------------------------------------------------------------
(1) Unaudited
See accompanying notes to financial statements.
- 1 -
<PAGE>
NB CAPITAL CORPORATION
STATEMENT OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
Three-month period ended Nine-month period ended
September 30 September 30
(in US dollars) 1999 1998 1999 1998
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenue
Interest income
Cash equivalents $ 924,381 $ 760,252 $ 2,038,982 $ 1,770,178
Promissory notes 8,331,826 8,803,757 26,164,081 27,469,414
- ------------------------------------------------------------------------------------------------------------------------------------
9,256,207 9,564,009 28,203,063 29,239,592
- ------------------------------------------------------------------------------------------------------------------------------------
Expenses
Servicing and advisory fees 308,762 178,589 948,934 989,756
Legal and other professional fees 120,089 161,863 168,692 464,302
- ------------------------------------------------------------------------------------------------------------------------------------
428,851 340,452 1,117,626 1,454,058
- ------------------------------------------------------------------------------------------------------------------------------------
Income before income taxes 8,827,356 9,223,557 27,085,437 27,785,534
Income taxes (recovery) - - 204,029 (2,000)
- ------------------------------------------------------------------------------------------------------------------------------------
Net income 8,827,356 9,223,557 26,881,408 27,787,534
- ------------------------------------------------------------------------------------------------------------------------------------
Preferred stock dividends 6,269,621 6,270,330 18,808,861 18,814,381
- ------------------------------------------------------------------------------------------------------------------------------------
Income available to common stockholders $ 2,557,735 $ 2,953,227 $ 8,072,547 $ 8,973,153
- ------------------------------------------------------------------------------------------------------------------------------------
Weighted average number of common shares
outstanding 100 100 100 100
- ------------------------------------------------------------------------------------------------------------------------------------
Earnings per common share - basic $ 25,577 $ 29,532 $ 80,725 $ 89,732
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
</TABLE>
- 2 -
<PAGE>
NB CAPITAL CORPORATION
STATEMENT OF STOCKHOLDERS' EQUITY
(Unaudited)
<TABLE>
<CAPTION>
Three-month period ended Nine-month period ended
September 30 September 30
(in US dollars) 1999 1998 1999 1998
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PREFERRED STOCK
Balance, beginning of period $ 3,001 $ 3,001 $ 3,001 $ 3,000
Senior preferred stock issued - - - 1
- ------------------------------------------------------------------------------------------------------------------------------------
Balance, end of period 3,001 3,001 3,001 3,001
- ------------------------------------------------------------------------------------------------------------------------------------
COMMON STOCK AND PAID-IN CAPITAL
Balance, beginning of period 476,761,015 476,533,785 476,761,015 476,431,382
Paid-in capital on issuance of senior
preferred stock - - - 329,999
Paid-in capital on other issuance costs - - - (227,596)
- ------------------------------------------------------------------------------------------------------------------------------------
Balance, end of period 476,761,015 476,533,785 476,761,015 476,533,785
- ------------------------------------------------------------------------------------------------------------------------------------
RETAINED EARNINGS
Balance, beginning of period 10,659,178 2,019,926 5,144,366 3,702,093
Net income 8,827,356 9,223,557 26,881,408 27,787,534
Preferred stock dividends (6,269,621) (6,270,330) (18,808,861) (18,814,381)
Common stock dividends - (2,000,000) - (9,702,093)
- ------------------------------------------------------------------------------------------------------------------------------------
Balance, end of period 13,216,913 2,973,153 13,216,913 2,973,153
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL STOCKHOLDERS' EQUITY $489,980,929 $479,509,939 $489,980,929 $479,509,939
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
</TABLE>
- 3 -
<PAGE>
NB CAPITAL CORPORATION
STATEMENT OF CASH FLOWS
(Unaudited)
Nine-month period ended
September 30
(in US dollars) 1999 1998
- --------------------------------------------------------------------------------
OPERATING ACTIVITIES
Net income $ 26,881,408 $ 27,787,534
Items not affecting cash resources
Due from an affiliated company (5,542,361) (4,459,057)
Due to parent company 4,986 (225,732)
Accounts payable 102,355 (232,631)
Income taxes payable - (80,000)
Accrued interest receivable on
cash equivalents (7,169) (39,693)
- --------------------------------------------------------------------------------
21,439,219 22,750,421
- --------------------------------------------------------------------------------
FINANCING ACTIVITIES
Issue of senior preferred stock - 330,000
Other issuance costs - (227,596)
Dividends (19,308,861) (28,516,474)
- --------------------------------------------------------------------------------
(19,308,861) (28,414,070)
- --------------------------------------------------------------------------------
INVESTING ACTIVITIES
Investment in promissory notes (85,989,303) -
Repayments of promissory notes 87,121,671 42,853,766
Securities - (20,215,243)
- --------------------------------------------------------------------------------
1,132,368 22,638,523
- --------------------------------------------------------------------------------
INCREASE IN CASH 3,262,726 16,974,874
Cash position, beginning of period 22,178,668 20,003,943
- --------------------------------------------------------------------------------
Cash position, end of period 25,441,394 36,978,817
================================================================================
- --------------------------------------------------------------------------------
See accompanying notes to financial statements.
- 4 -
<PAGE>
NB CAPITAL CORPORATION
NOTES TO FINANCIAL STATEMENTS
September 30, 1999
(unaudited)
(in U.S. dollars)
1) Incorporation and nature of operations
NB Capital Corporation (the "Company") was incorporated in the State of Maryland
on August 20, 1997. The Company's principal business is to acquire, hold,
finance and manage mortgage assets. The Company issued, through an Offering
Circular dated August 22, 1997, $300 million of preferred stock and
simultaneously, National Bank of Canada, the parent company, made a capital
contribution in the amount of $183 million. The Company used the aggregate net
of proceeds of $477 million to acquire promissory notes of NB Finance, Ltd., a
wholly-owned subsidiary of National Bank of Canada.
2) Significant accounting policies
Financial statements
The financial statements are prepared in accordance with accounting principles
generally accepted in the United States of America and are expressed in U.S.
dollars.
Income taxes
The Company has elected to be taxed as a real estate investment trust ("REIT")
under the Internal Revenue Code of 1986, as amended, and accordingly, is
generally not liable for United States federal income tax to the extent that it
distributes at least 95% of its taxable income to its stockholders, maintains
its qualification as a REIT and complies with certain other requirements.
Per share data
Basic earnings per share with respect to the Company for the nine-month periods
ended September 30, 1999 and 1998 are computed based upon the weighted average
number of common shares outstanding during the period. In February 1997, the
Financial Accounting Standards Board issued Statement of Financial Accounting
Standard No. 128 "Earnings Per Share". This pronouncement specifies the
computation, presentation and disclosure requirements for earnings per share.
The Company has no outstanding securities which are dilutive under this
pronouncement.
Estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
- 5 -
<PAGE>
NB CAPITAL CORPORATION
NOTES TO FINANCIAL STATEMENTS
September 30, 1999
(unaudited)
(in U.S. dollars)
3) Promissory notes
The Company entered into loan agreements evidenced by promissory notes with NB
Finance, Ltd., an affiliated company. The promissory notes are collateralized
only by mortgage loans which are secured by residential first mortgages and
insured by the Canada Mortgage and Housing Corporation.
The promissory notes have maturities ranging from October 1999 to December 2003,
at rates ranging from 6.90% to 9.77%, with a weighted average rate of
approximately 7.96% per annum.
These rates approximate market interest rates for loans of similar credit and
maturity provisions and, accordingly, management believes that the carrying
value of the promissory notes receivable approximates their fair value.
Promissory notes as of June 30, 1999 399,340,392
Acquisition 85,989,303
Principal repayments (34,562,106)
-----------------------------------------------------------------------
Promissory notes as of September 30, 1999 450,767,589
-----------------------------------------------------------------------
The scheduled remaining principal repayments are as follows :
1999 35,510,854
2000 157,347,374
2001 211,232,712
2002 29,301,727
2003 17,374,922
4) Transactions with an affiliated company
During the quarter ended September 30, 1999 and September 30, 1998, the Company
earned interest from NB Finance, Ltd. in the amount of $8,331,826 and
$8,803,757, respectively (see Note 3).
The amount of $14,209,752 due from an affiliated company as of September 30,
1999 and $8,667,391 as of December 31, 1998, represent interest and principal
repayments due on the promissory notes.
5) Transactions with the parent company
The Company has entered into agreements with National Bank of Canada in
connection with the administration of the Company's operations. The agreements
are as follows :
Advisory agreement
In exchange for a fee equal to $25,000 per year, payable in equal quarterly
installments, National Bank of Canada will furnish advice and recommendations
with respect to all aspects of the business and affairs of the Company. During
the three-month periods ended September 30, 1999, and September 30, 1998, fees
of $6,250 were charged to the Company.
- 6 -
<PAGE>
NB CAPITAL CORPORATION
NOTES TO FINANCIAL STATEMENTS
September 30, 1999
(unaudited)
(in U.S. dollars)
5) Transactions with the parent company (continued)
Servicing agreement
National Bank of Canada will service and administer the promissory notes and the
collateralized mortgage loans and will perform all necessary operations in
connection with such servicing and administration.
National Bank of Canada will receive a monthly fee equal to one-twelfth (1/12)
of 0.25% per annum of the aggregate outstanding balance of the collateralized
mortgage loans as of the last day of each calendar month. For the three-month
periods ended September 30, 1999 and September 30, 1998, the average outstanding
balance of the collateralized mortgage loans were $507,356,341 and $524,297,801,
respectively. During the three-month periods ended September 30, 1999 and
September 30, 1998, fees of $302,512 and $172,339 respectively, were charged to
the Company.
Custodian agreement
National Bank of Canada will hold all documents relating to the collateralized
mortgage loans. During the three-month periods ended September 30, 1999, and
September 30, 1998, no fee was charged to the Company.
6) Stockholders' equity
Common stock
The Company is authorized to issue up to 1,000 shares of $ 0.01 par value common
stock.
Preferred stock
The Company is authorized to issue up to 10,000,000 shares of $0.01 par value
preferred stock as follows :
300,000 shares classified as 8.35% Noncumulative Exchangeable Preferred Stock,
Series A, non-voting, ranked senior to the common stock and junior to the
Adjustable Rate Cumulative Senior Preferred Shares, with a liquidation value of
$1,000 per share, redeemable at the Company's option on or after September 3,
2007, except upon the occurrence of certain changes in tax laws in the United
States of America and in Canada, on or after September 3, 2002.
1,000 shares classified as Adjustable Rate Cumulative Senior Preferred Shares,
non-voting, ranked senior to the common stock and to the 8.35% Noncumulative
Exchangeable Preferred Stock, Series A, with a liquidation value of $3,000 per
share, redeemable at the Company's option at any time and retractable at the
holder's option on December 30, 2007 and every ten-year anniversary thereof.
- 7 -
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS
AND RESULTS OF OPERATIONS
The Company's principal business objective is to acquire, hold, finance and
manage assets consisting of obligations secured by real property as well as
other qualifying REIT assets ("Mortgage Assets"). The Company has elected to be
taxed as a REIT under the Internal Revenue Code of 1986, as amended, and,
accordingly, is generally not liable for United States federal income tax to the
extent that it distributes at least 95% of its taxable income, subject to
certain adjustments, to its stockholders.
Results of operations:
For the three-month periods ended September 30, 1999 and September 30, 1998, the
Company reported net income of $8,827,356 and $9,223,557, respectively.
Revenues, which were comprised entirely of interest income, were $9,256,207 and
$9,564,009 respectively, and expenses were $428,851 and $340,452, respectively.
For the nine-month period ended September 30, 1999, the Company paid income tax
for the amount of $204,029 representing income tax on interest earned in Canada
on deposit. In connection with the reversal of a provision for income taxes
previously reserved by the Company, a $2,000 recovery was recognized during the
nine-month period ended September 30, 1998.
Ninety percent of revenues for the three-month period ended September 30, 1999
and ninety-two percent of revenues for the three-month period ended September
30, 1998 were derived from the Mortgage Assets issued by NB Finance, Ltd., an
affiliated company ("NB Finance"). The Mortgage Assets issued by NB Finance are
collateralized by the "Mortgage Loans" that consist of twenty two pools of
residential first mortgages insured by Canada Mortgage and Housing Corporation
and which are secured by real property located in Canada. The balance of the
revenues result from interest on bank deposits.
Expenses for the three-month periods ended September 30, 1999 and 1998, totaled
$428,851 and $340,452, respectively, of which $308,762 and $178,589,
respectively, represent servicing and advisory fees paid to National Bank of
Canada, the Company's direct parent (the "Bank") pursuant to the Servicing
Agreement between the Bank and the Company (the "Servicing Agreement") and the
Advisory Agreement between the Bank and the Company (the "Advisory Agreement"),
whereby the Bank performs all necessary operations in connection with
administering the Mortgage Assets issued by NB Finance and the Mortgage Loans.
Legal and other professionnal fees include charges from the external accounting
fees.
During the three-month period ended September 30, 1999, the Board of Directors
of the Company authorized dividends of, in the aggregate, $6,269,621 ($6,270,330
for the three-month period ended September 30, 1998) on Preferred Stock (i.e.,
Adjustable Rate Cumulative Senior Preferred Shares (the "Senior preferred
Shares") and 8.35% Noncumulative Exchangeable Preferred Stock, Series A (the
"Series A Preferred Shares") and, accordingly, the Depositary Shares). Such
dividends were paid on September 30, 1999 and September 30, 1998.
Capital Resources and Liquidity:
The Company's revenues are derived from its Mortgage Assets. As of September 30,
1999, US$451 million of Mortgage Assets issued by NB Finance were
over-collaterized by the C$803 million ($547 million) of Mortgage Loans. The
Company believes that the amounts generated from the payment of interest and
principal on such Mortgage Loans will provide more than sufficient funds to make
full payments with respect to the Mortgage Assets issued by NB Finance and that
such payments will provide the Company with sufficient funds to meet its
operating expenses and to pay quarterly dividends on the Senior Preferred Shares
and the Series A Preferred Shares and, accordingly, the Depositary Shares. To
the extent that the cash flow from its Mortgage Assets exceeds those amounts,
the Company will use the excess to fund the acquisition of additional Mortgage
Assets and make distributions on the Common Stock.
The Company does not require any capital resources for its operations and,
therefore, it is not expected to acquire any capital assets in the foreseeable
future.
- 8 -
<PAGE>
As at September 30, 1999, the Company had cash resources of $25,441,394 which
represent 5.2% of total assets compared to $22,178,668 or 4.6% of total assets
as at December 31, 1998. The increase in liquidity is attributable to cash
received in repayment of Mortgage Assets. It is expected that the Company will
invest in additional Mortgage Assets. The liquidity level is sufficient for the
Company to pay fees and expenses pursuant to the Servicing Agreement and the
Advisory Agreement.
The Company's principal short-term and long-term liquidity needs are to pay
quarterly dividends on the Senior Preferred Shares and the Series A Preferred
Shares and, accordingly, the Depositary Shares, to pay fees and expenses of the
Bank pursuant to the Servicing Agreement and the Advisory Agreement, and to pay
franchise fees and expenses of advisors, if any, to the Company.
The Company does not have any indebtedness (current or long-term), other
material capital expenditures, balloon payments or other payments due on other
long-term obligations. No negative covenants have been imposed on the Company.
Year 2000
The Company does not believe that it has a material problem resulting from the
inability of computer programs to properly recognize a year that begins with
"20" instead of "19". Pursuant to the Advisory Agreement, the Bank administers
the day-to-day activities of the Company. Pursuant to the Servicing Agreement,
the Bank services the Mortgage Loans and performs all necessary operations in
connection with such servicing. The Company does not independently maintain
either information technology or non-information technology systems.
Accordingly, the Company does not believe that it has or will have a material
Year 2000 issue.
The Bank has formulated a detailed plan to address the Year 2000 issue. As at
July 31, 1999, all of the scheduled Year 2000 preparations have been carried out
as scheduled. All of the Bank's equipment and major systems have been certified
Year 2000 compliant. Steps have been taken to request assurances from the Bank's
main suppliers that their own systems are Year 2000 compliant. Special programs
have been introduced to ensure that commercial clients work to minimize their
risks in the transition to the Year 2000. In addition, the Bank has created a
contingency plan providing for the implementation of backup systems and
operating procedures and has developed a number of prevention activities wich
are already underway.
The Bank has also finished evaluating the responses of its main suppliers and
commercial clients and has developed a communication plan for both its clients
and employees.
In the opinion of management of the Bank, the Bank has adopted measures which
serve to minimize the uncertainty and risk associated with the transition to the
Year 2000. Its approach of keeping its commercial clients informed and following
up with them allows the Bank to believe that neither the credit risk of its
portfolio nor its results will be materially affected by the arrival of the Year
2000. However, management of the Bank cannot be certain that the transition to
the Year 2000 will not cause any inconvenience, particularly in light of factors
that are beyond its control and wich depend on the diligence of clients,
suppliers and other parties.
Pursuant to an order of The Office of the Superintendent of Financial
Institutions Canada, NB Finance is prohibited from engaging in any business
activities other than the ownership of the Mortgage Loans and activities
incidental thereto. Pursuant to the Mortgage Loan Assignment, NB Finance
assigned its entire right, title and interest in, to and under the Mortgage
Loans to the Company and permits the Company to administer, perform and enforce
the Mortgage Loans. Pursuant to the Servicing Agreement, the Mortgage Loans are
serviced by the Bank. NB Finance does not independently maintain either
information technology or non-information technology systems. Accordingly, the
Company does not believe that NB Finance has or will have a material Year 2000
issue.
The Company maintains relationships with other party service providers; however,
the Company does not consider the services received therefrom to be material to
its operations.
- 9 -
<PAGE>
At this time, the Company believes that its most reasonably likely worst case
Year 2000 scenario would be a delay by NB Finance in making payments of
principal and interest to the Company when due, causing the Company to be unable
to meet its short-term liquidity needs. Although the Company believes that it is
unlikely that such scenario would occur, it has developed a contingency plan
pursuant to which it would obtain a cash advance from NB Finance, in an amount
approximating previous payments of principal and interest, in time to meet its
short-term liquidity requirements. Accordingly, at this time, the Company does
not believe that it would experience a material adverse effect as a result of
the occurrence of the most reasonably likely worst case Year 2000 scenario.
- 10 -
<PAGE>
PART II. OTHER INFORMATION
--------------------------
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits:
Exhibit No. Description
11 Computation of Earnings Per Share
27 Financial Data Schedule
b) Reports on Form 8-K:
No reports on Form 8-K were filed during the quarter for which this
report is filed.
- 11 -
<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.
NB CAPITAL CORPORATION
Date November 15, 1999 /s/ Tom Doss
--------------------------------------
Tom Doss
Chief Financial Officer and Treasurer
- 12 -
EXHIBIT 11
NB CAPITAL CORPORATION
COMPUTATION OF EARNINGS PER SHARE
Three-month period Three-month period
ended ended
September 30, September 30,
1999 1998
Net income $ 8,827,356 $ 9,223,557
Deduct: Senior preferred stock
and series A preferred
stock dividends 6,269,621 6,270,330
--------- ---------
(A) $ 2,557,735 $ 2,953,227
Common share outstanding (B) 100 100
Earning per share (A/B) $ 25,577.35 $ 29,532.27
- 13 -
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM NB CAPITAL
CORPORATION'S UNAUDITED BALANCE SHEET AS OF SEPTEMBER 30, 1999 AND UNAUDITED
STATEMENT OF INCOME FOR THE QUARTER ENDED SEPTEMBER 30, 1999 INCLUDED IN NB
CAPITAL CORPORATION'S QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED
SEPTEMBER 30, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0001049551
<NAME> NB Capital Corporation
<MULTIPLIER> 1,000
<CURRENCY> US Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JUL-01-1999
<PERIOD-END> SEP-30-1999
<EXCHANGE-RATE> 1
<CASH> 25,441,394
<SECURITIES> 0
<RECEIVABLES> 464,984,510
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 490,425,904
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 490,425,904
<CURRENT-LIABILITIES> 444,975
<BONDS> 0
0
3,001
<COMMON> 1
<OTHER-SE> 489,977,927
<TOTAL-LIABILITY-AND-EQUITY> 490,425,904
<SALES> 0
<TOTAL-REVENUES> 9,256,207
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 428,851
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 8,827,356
<INCOME-TAX> 0
<INCOME-CONTINUING> 8,827,356
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,827,356
<EPS-BASIC> 25,577
<EPS-DILUTED> 25,577
</TABLE>
