8
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X]Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the period ended March 31, 1995
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 1-6701
Providian
Corporation
(Exact name of Registrant as specified in its charter)
Delaware 51-0108922
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
400 West Market Street, Louisville, Kentucky 40202
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (502) 560-
2000
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
and (2) has been subject to such filing requirements for the past
90 days. Yes X No ___.
Indicate the number of shares outstanding of each of the issuer's
classes of common stock as of April 30, 1995.
Class Shares Outstandi
ng
Common Stock, $1.00 par value 96,441,163
Part I - FINANCIAL INFORMATION
Item 1. Financial Statements
PROVIDIAN CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
March 31, 1995
December 31,
(Unaudited)
1994
(Dollars in
Thousands)
Assets
Investments:
Bonds and stocks, available for sale
(Amortized cost of $10,981,536 and $10,910,805
in 1995 and 1994, respectively) $10,728,538
$10,301,682
Bonds and stocks, trading
111,476 115,470
Commercial mortgage loans 2,695,066
2,649,664
Residential mortgage loans 2,816,784
2,550,194
Consumer loans 2,780,958
2,269,531
Policy loans
397,003 390,639
Other investments
377,824 418,321
Total Investments 19,907,649
18,695,501
Cash and cash equivalents
566,922 573,379
Deferred policy and loan acquisition costs 1,497,438
1,491,422
Value of insurance in force purchased
270,454 273,466
Goodwill
219,997 222,035
Separate account assets 1,521,874
1,353,476
Other assets
995,608 1,004,080
Total Assets $24,979,942
$23,613,359
Liabilities and Shareholders' Equity
Liabilities:
Benefit reserves and other policy liabilities $ 9,105,552
$ 9,092,370
Policyholder contract deposits 7,633,126
7,421,604
Banking deposits 1,942,152
1,680,450
Separate account liabilities 1,521,874
1,353,476
Long-term debt
719,250 694,250
Deferred federal income tax
274,210 149,831
Other liabilities 1,325,161
999,516
Total Liabilities 22,521,325
21,391,497
Commitments and Contingencies
Preferred Stock of Consolidated Subsidiary
100,000 100,000
Shareholders' Equity:
Common stock, $1 par
115,325 115,325
Additional paid-in capital
57,648 57,096
Net unrealized investment loss
(125,104) (344,526)
Retained earnings 2,559,328
2,512,935
Common stock held in treasury - at cost:
1995 - 18,612,000 shares;
1994 - 17,789,000 shares
(243,217) (214,031)
Unearned restricted stock
(5,36 (4,937)
Total Shareholders' Equity 2,358,617
2,121,862
Total Liabilities and Shareholders' Equity $24,979,942
$23,613,359
See notes to condensed consolidated financial statements.
Item 1. (continued)
PROVIDIAN CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
Three Months Ended March 31 1995 1994
(Amounts in
Thousands
Except Per Common
Share)
Revenues:
Premiums and other considerations $ 295,411 $
291,492
Investment income, net of expenses 459,876
378,987
Consumer loan servicing fees 49,820
42,108
Realized investment loss (34,156)
(36,733)
Other income, net 26,601
22,405
Total Revenues 797,552
698,259
Benefits and Expenses:
Benefits and claims 228,634
217,901
Increase in benefit and contract
reserves 205,789
139,969
Commissions, net 18,915
17,859
General, administrative and other
expenses, net 156,968
129,678
Amortization of deferred policy
and loan acquisition costs, value
of insurance in force purchased
and goodwill 59,131
81,164
Interest expense 26,334
19,236
Total Benefits and Expenses 695,771
605,807
Income before Federal Income Tax 101,781
92,452
Federal Income Tax 30,652
28,444
Net Income before Preferred Stock
Dividends of Consolidated Subsidiary 71,129
64,008
Dividends on Preferred Stock of
Consolidated Subsidiary 1,442
- -
Net Income 69,687
64,008
Dividends on Nonconvertible
Preferred Stock -
1,163
Net Income Applicable to Common Stock $ 69,687 $
62,845
Net Income per Common Share $ .72 $
.62
Cash Dividends per Common Share $ .225 $
.20
Weighted Average Number of Common Shares
Outstanding During the Period 97,167
101,052
See notes to condensed consolidated financial statements.
Item 1. (continued)
PROVIDIAN CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Three Months Ended March 31
1995 1994
(Dollars in Thousands)
Net Cash Flows provided by Operations $
403,135 $ 233,085
Cash Flows from Investment Activities:
Investments sold or matured
946,263 1,946,88
Cost of securities and mortgage loans acquired
(1,215,174) (2,490,451)
Additions to operating property
(6,439) (6,186)
Net increase in consumer loans
(478,771) (42,703)
Securitization of consumer loans
- - 100,000
Purchase of securitized consumer loans
(41,204) (49,289)
All other investment activities
2,444 6,529
Net Cash Flows used in Investment Activities
(792,881) (535,216)
Cash Flows from Financing Activities:
Net increase in short-term borrowings
92,108 149,567
Policyholder contract deposits
694,531 1,025,40
Withdrawals of policyholder contract deposits
(709,288) (661,607)
Net increase (decrease) in banking deposits
261,702 (56,364)
Issuance of long-term debt
25,000 -
Repayment of long-term debt
Net borrowings from revolving line of credit
75,000 -
Redemption of preferred stock
- - (100,000)
Purchase of common stock for treasury
(36,545) (47,555)
Dividends
(21,959) (22,854)
Proceeds from exercise of stock options
2,7 40 1,322
Net Cash Flows provided by Financing Activities
383,289 287,883
Net Decrease in Cash and Cash Equivalents
(6,457) (14,248)
Cash and Cash Equivalents at Beginning of Period
573,379 719,053
Cash and Cash Equivalents at End of Period $
566,922 $ 704,805
See notes to condensed consolidated financial statements.
Item 1. (continued)
PROVIDIAN CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
A. The accompanying unaudited condensed consolidated financial
statements have been prepared in accordance with the
instructions to Form 10-Q and in conformity with generally
accepted accounting principles and reflect all adjustments
which are, in the opinion of management, necessary to a fair
presentation of the results for the interim periods
presented. All such adjustments are of a normal recurring
nature. Certain 1994 amounts have been reclassified to
conform to the current year presentation. These
reclassifications did not have a significant effect on the
Company's financial position, results of operations or cash
flows. The results of operations for the three-month period
ended March 31, 1995 are not necessarily indicative of the
results to be expected for the full year ending December 31,
1995. These unaudited condensed consolidated financial
statements should be read in conjunction with
the consolidated financial statements and footnotes included
in the Company's annual report on Form 10-K for the year
ended December 31, 1994.
B. Per common share amounts have been calculated using net
income after dividends on nonconvertible preferred stock,
divided by the weighted average number of common shares
outstanding during the three-month period. Fully diluted
net income per common share is not presented as it
approximates net income per common share.
C. Consumer loans have been reduced by the sale, without
recourse, of unsecured receivables under asset
securitization plans. There have been no securitizations
under these plans during 1995. At March 31, 1995, there
were $677.0 million of consumer loans in process of
securitization. Total unsecured consumer receivables
outstanding under securitization plans were $2.3 billion at
March 31, 1995.
D. An analysis of the allowance for loan losses on consumer and
mortgage loans for the three-month period ended March 31,
1995 and 1994 is as follows:
Consumer Mortgage
Three Months Ended March 31 1995 1994 1995 1994
(Dollars in Thousands)
Balance at beginning of $ 76,21 $ 75,06 $ 52,20 $ 51,362
period 8 1 0
Current period provision 8,451 (2,204) 2,749 8,748
Current period
chargeoffs, (15,36 (14,65 (1,55 (6,673
net of recoveries 7) 4) 9) )
Balance at end of period $ 69,30 $ 58,20 $ 53,39 $ 53,437
2 3 0
Effective January 1, 1995 the Company adopted SFAS No. 114,
"Accounting by Creditors for Impairment of a Loan," as
amended by SFAS No. 118 "Accounting by Creditors for
Impairment of a Loan - Income Recognition Disclosures." The
following additional disclosures relate to the commercial
loan portfolio, as large groups of smaller balance
homogeneous loans such as credit card, consumer installment
loans, or residential mortgages are excluded. At March 31,
1995, the recorded
Item 1. (continued)
investment in loans that are considered to be impaired under
SFAS 114 was $97.8 million with related allowances for
credit losses of $28.6 million. The average recorded
investment in impaired loans during the three-months ended
March 31, 1995 was $98.6 million. For the three-months ended
March 31, 1995, the Company recognized $964 thousand of
interest income on those impaired loans which included $66
thousand of interest income recognized using the cash basis
method of income recognition.
E. During the three months ended March 31, 1995, the Company
issued $25.0 million of Series D medium-term notes with
maturities ranging from seven to 30 years and interest rates
ranging from 7.89 to 8.53 percent. Subsequent to March 31,
1995 and through May 5, 1995, the Company issued an
additional $11.0 million of these notes with maturities
ranging from 20 to 30 years and interest rates ranging from
8.34 to 8.46 percent.
F. During the three months ended March 31, 1995, the Company
repurchased 1,062,000 shares of its common stock at an
average price of $34.41 per share. Subsequent to March 31,
1995 and through May 5, 1995, the Company repurchased
391,600 additional shares at an average price of $34.63 per
share.
Item 2.MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Operations
Providian's net income for the three months ended March 31, 1995
was $.72 per common share, up 16.1 percent from last year's $.62
per common share. Net income in 1995 includes pretax realized
losses of $34.2 million, comprised of investment and securities
losses of $31.4 million and $2.8 million in provisions for
mortgage loan losses. Pretax realized losses for the three
months ended March 31, 1994 were $36.7 million.
Earnings, excluding realized investment gains and losses, net of
related deferred acquisition cost amortization and tax and
dividends on the preferred stock of a consolidated subsidiary,
for the three months ended March 31, 1995 were $.96 per common
share, up 6.7 percent from the $.90 per common share reported
last year. These earnings reflect the continued impact of the
significant increase in interest rates experienced in 1994.
Revenues, as discussed hereinafter, exclude realized investment
gains and losses. Consolidated revenues for the quarter were
$831.7 million, up 13.2 percent from the $735.0 million in the
prior year, primarily the result of higher investment income.
Consolidated premiums were $295.4 million, up slightly from 1994,
primarily from growth in life premium in force. Net investment
income for the quarter was $459.9 million, an increase of 21.3
percent, reflecting higher yields and growth in assets over 1994.
Providian Agency Group's first quarter pretax earnings were $44.5
million, down 2.5 percent from first quarter 1994. Earnings
decreased primarily due to unfavorable mortality experience,
resulting from an increase in the number of large claims, and
increased claims experience from health products. Positively
impacting earnings were life premium growth, a continued
favorable trend of decreased spending resulting from cost
management initiatives and higher investment income. Individual
life pretax earnings, which account for most of Providian Agency
Group income, were down 3.4 percent to $43.6 million, primarily
due to the unfavorable mortality experience. Total premiums
increased $1.7 million due to growth in premium in force,
reflecting continued strong persistency. Sales for the quarter
were up 15.7 percent over a disappointing first quarter 1994,
including a 15.1 percent improvement in life sales. Field
management initiatives resulted in increased sales per agent
partially offset by a decline in the number of working agents.
The combined life and health policy termination rate of 14.1
percent has improved from the 14.5 percent rate for the full year
1994, although it is slightly unfavorable as compared to the
excellent first quarter 1994 rate of 13.8 percent.
Providian Direct Insurance ("PDI") continued its solid
performance with first quarter pretax earnings of $29.6 million,
up 12.1 percent over first quarter 1994. The increase reflects
the effect of continuing profit improvement initiatives including
premium rate, claims and cost management efforts initiated
throughout 1994 and into the first quarter of 1995, and the
successful introduction of new products such as First Health
Advantage. Life, health and other pretax earnings increased 10.9
percent to $26.7 million while property and casualty pretax
earnings of $3.0 million were modestly above prior year results.
Life profit margins (defined as pretax earnings as a percentage
of premium income) were 22.5 percent, improved from last year's
22.2 percent due to lower operating expenses. Health profit
margins (defined as pretax earnings as a percentage of premium
income) were 21.3 percent, improved from last year's 20.4 percent
due to lower expenses and favorable claims experience. The
property and casualty combined ratio (defined as the ratio of
total dollars of claims and expenses incurred for each $100 of
premiums) continues to show a positive
Item 2. (continued)
trend at 103.3 percent, compared to 104.2 percent for the first
quarter of 1994, the result of reunderwriting and integration
efforts in the military auto business. PDI premiums were up 2.1
percent to $173.2 million primarily due to the acquisition of a
block of life business in March 1995. Life premiums increased
6.6 percent over last year due to growth in premium in force and
the aforementioned purchase of business, while health premiums
declined 2.3 percent as lapsations were not yet offset by
increased sales and retention efforts. Total sales declined 3.2
percent from first quarter 1994 levels, as a significant
improvement in health sales was offset by lower life sales to
existing customers and lower property and casualty sales.
However, direct life sales to new customers in the first quarter
were up 17.8 percent.
Providian Bancorp's outstanding earnings growth continued with
pretax earnings of $42.1 million for the quarter, up 28.0 percent
from first quarter 1994. These results reflect continued growth
in consumer receivable accounts and balances, strong margins and
increased fee-based income. Total managed loans, including $2.3
billion of securitized receivables and $677.0 million in the
process of securitization, were $5.1 billion at March 31, 1995,
up 29.8 percent over first quarter 1994. The continued success
of the Primary Lender strategy and the First Gold product has
contributed strongly to the growth in unsecured receivables of
$949.8 million since March 31, 1994. Unsecured receivable
balances increased $338.4 million since December 31, 1994, a
period in which balances would normally be expected to decline
due to seasonality. The Primary Lender strategy, which offers
custom-tailored services to fulfill the individual needs of
valuable customers, is a significant reason for this increase.
Additionally, the Select Equity loan portfolios reflected solid
growth of $171.1 million over first quarter 1994. Return on mean
assets was even with the first quarter 1994 rate of 5.9 percent.
Loan loss reserves related to unsecured consumer receivables,
excluding securitized receivables and those in the process of
securitization, were 4.2 percent compared to 5.6 percent at March
31, 1994. Net credit losses for unsecured receivables (before
securitization) were 4.3 percent for the quarter, improved from
5.2 percent for the same period last year. Balances past due
greater than 30 days related to unsecured consumer receivables,
excluding those previously securitized, increased to 3.2 percent
compared to 1.9 percent last year and the 2.3 percent year end
rate. The following table summarizes dollar amounts of
unsecuritized problem consumer loans, as of March 31, 1995 and
December 31, 1994:
March 31, December 31,
1995 1994
(Dollars in Millions)
Non-accrual loans $ 9.5 $ 7.2
Loans past due greater than 30 65.5 59.5
days
Total problem consumer loans $75.0 $66.7
There were no additional specifically identified consumer loans
that represented significant potential problems.
Providian Capital Management ("PCM") pretax earnings were $29.9
million for the first quarter, down 20.7 percent from the same
period last year. The significant rise in interest rates
throughout 1994 continues to compress margins, partially offset
by asset growth and reduced amortization of retail acquisition
costs. Profit margins on spread-based deposits for the quarter
were 85 basis points, down from 121 basis points in first quarter
1994. Mean policyholder deposits, a key driver of profitability,
grew by 6.1 percent during 1995. PCM is implementing its
previously announced strategy to maintain
Item 2. (continued)
institutional spread-based deposits approximately at year-end
1994 levels; however, balances grew $215.7 million during the
quarter to offset the expected impact of maturities later in the
year. PCM continues to focus on growing the fee-based and retail
spread-based businesses. For the quarter, fee-based retail
deposits grew $114.7 million to $1.1 billion due to sales of new
products and asset appreciation. This represents a 33.8 percent
increase from first quarter 1994 balances. Customer balances for
the very successful fee-based Trust GIC products grew $1.1
billion during the first quarter. Total customer balances of
$9.6 billion represent an increase of 74.2 percent over March 31,
1994. The growth reflects continuing interest for these
innovative products. Retail spread-based deposits remained
essentially unchanged during the quarter.
Cash and invested assets were $20.5 billion, up 6.3 percent from
December 31, 1994. Excluding Providian Bancorp, invested assets
related to insurance operations were $17.5 billion compared to
$16.8 billion at December 31, 1994. The distribution of invested
assets at March 31, 1995 has not changed significantly from
December 31, 1994. Exposure to below investment grade bonds,
preferred stocks and investments in limited partnerships with
below investment grade characteristics at March 31, 1995 was 5.6
percent, compared to 5.5 percent at December 31, 1994. Default
and loss experience in the securities portfolio is excellent with
no defaults and no significant losses as a result of impairments
this year. As of March 31, 1995, there were no securities in the
bond or preferred stock portfolios that were delinquent as to
interest or dividends.
Problem commercial mortgage loans (based on the ACLI definition,
which includes loans past due 60 days or more, loans in the
process of foreclosure, restructured loans and real estate
acquired through foreclosure) as of March 31, 1995, amounted to
4.2 percent of outstanding commercial loans, down from 4.6
percent at December 31, 1994. The industry average for problem
commercial mortgage loans was 18.4 percent at December 31, 1994
(the most recently published statistics). Problem residential
mortgage loans (based on Mortgage Bankers Association (MBA)
standards, which is based on the number of loans that are past
due 30 days or more, and loans in the process of foreclosure)
were 2.6 percent and 1.5 percent at March 31, 1995 and
December 31, 1994, respectively. The MBA average for problem
residential mortgage loans was 5.3 percent at December 31, 1994
(the most recently published statistics). Loans on which the
Company has discontinued the accrual of interest and restructured
loans accruing interest as of March 31, 1995 and December 31,
1994 were as follows:
Commercial Residential Loans
Loans
March December March 31, December
31, 31, 1994 1995 31, 1994
1995
(Dollars in Millions)
Non-accrual loans $56.0 $68.2 $22.0 $10.7
Restructured
loans,
accruing interest 4.0 4.3 - -
$60.0 $72.5 $22.0 $10.7
As of March 31, 1995, there were approximately $33.1 million of
commercial mortgage loans with identified potential problems
which could cause these loans to be included in a problem
category in the future; the Company does not anticipate any
material additional losses to arise from these loans.
Item 2. (continued)
As a result of decreases in interest rates during the first
quarter of 1995, the fair value of the Company's available for
sale portfolio increased significantly from year-end values.
Gross unrealized losses on this portfolio decreased by
approximately $356.1 during this period, resulting in an increase
of $219.4 in shareholders'equity.
Liquidity and Cash Flow
Net cash flows from operations were $403.1 million during the
quarter, compared to $233.1 million last year. The increase over
last year related to lower federal income taxes paid during the
first quarter of 1995 as compared to 1994. Additionally, the
increase was a result of higher investment income received due to
higher yields and growth in assets offset by higher accruals for
credited interest on policyholder deposits as a result of the
higher interest rate environment. Commercial paper borrowings
averaged $51.3 million during the quarter at a weighted average
interest rate of 6.02 percent. Commercial paper outstandings at
March 31, 1995 were $24.8 million. The Company has committed
lines of credit of $850.0 million which would provide additional
liquidity should adverse conditions materialize, and as back-up
to the commercial paper program. At March 31, 1995 there were no
borrowings under these lines of credit. In addition, the
Company's bond and stock portfolio of $10.8 billion at March 31,
1995 provides a significant source of short-term liquidity.
Providian Bancorp analyzes its current and future liquidity needs
to support its deposit portfolio and asset growth and has a $500
million credit agreement. The agreement provides liquidity for
the existing deposit base as well as satisfying short-term
funding requirements. Outstanding borrowings under the agreement
were $300.0 million at March 31, 1995.
The Company issued $25.0 million of its Series D medium-term
notes during the first three months of 1995. Subsequent to March
31, 1995 and through May 5, 1995, the Company issued an
additional $11.0 million of these notes.
During the first quarter, Providian repurchased 665,600 shares of
its common stock to successfully complete the second of two
repurchase programs announced in 1994 for a total of five million
shares. In addition, 396,400 shares were repurchased during the
first quarter related to the plan announced in March, 1995 to
repurchase an additional two million shares. The first quarter
repurchases of 1,062,000 shares were completed at an average
price of $34.41 per share. Subsequent to March 31, 1995 and
through May 5, 1995, the Company repurchased 391,600 additional
shares at an average price of $34.63 per share.
Providian is a legal entity, separate and distinct from its
subsidiaries and has no business operations. The primary sources
of cash to meet its obligations, including principal and interest
payments with respect to indebtedness, are dividends and other
statutorily permitted payments from its subsidiaries.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
In the normal course of business, the Company and its
subsidiaries are parties to a number of lawsuits. Management
believes that these suits will be resolved with no material
financial impact to the Company.
Item 2. Change in Securities
Not applicable
Item 3. Defaults upon Senior Securities
Not applicable
Item 4. Submission of Matters to a Vote of Security Holders
The Company's annual meeting of shareholders was held on May 5,
1995. Following are the results of proposals voted upon at that
meeting. As of the record date (March 10, 1995) there were
97,067,455 issued and outstanding shares eligible to vote.
Proposal 1:
John M. Cranor III, J. David Grissom, F. Warren McFarlan and
Martha R. Seger, Ph.D. were elected to the Board of Directors.
Below is the number of votes cast for or withheld for each
director elected.
Name For Withhel
d
John M. Cranor III 83,011,8 436,156
12
J. David Grissom 83,009,7 438,264
04
F. Warren McFarlan 83,002,6 445,335
33
Martha R. Seger, Ph.D. 82,990,3 457,621
47
Directors continuing to serve on the Board are Irving W. Bailey
II, John L. Clendenin, Raymond V. Gilmartin, Shailesh J. Mehta,
Joseph F. Decosimo, Lyle Everingham, Watts Hill, Jr. and Larry D.
Thompson.
Proposal 2:
The shareholders approved the adoption of the Company's 1995
Stock Option Plan. The 1995 Stock Option plan replaces the
Company's 1989 Stock Option Plan. The results of the vote were
66,097,563 for, 16,476,224 against, and 874,181 abstained.
Proposal 3:
The shareholders approved the adoption of the Company's
Management Incentive Plan. The results of the vote were
76,513,430 for, 6,142,701 against, and 791,837 abstained.
PART II - OTHER INFORMATION (continued)
Proposal 4:
The shareholders approved an amendment to the Company's Stock
Ownership Plan to reduce the aggregate number of shares of Common
Stock which may be awarded from 3,600,000 to 2,000,000, increase
the maximum number of matching shares of Restricted Stock which
may be awarded to a participant under the Plan from 100 percent
to 200 percent of a related grant of Nonrestricted Stock and to
address tax deductibility limits imposed by the Omnibus Budget
Reconciliation Act of 1993. The results of the vote were
76,147,941 for, 6,449,697 against, and 850,330 abstained.
Proposal 5:
The shareholders approved the appointment of Ernst & Young LLP as
the Company's independent auditors. The results of the vote were
80,750,526 for, 2,102,641 against, and 594,801 abstained.
Item 5. Other Information
Effective April 14, 1995 Lee Adrean, president of Providian
Agency Group since 1993, resigned to accept the position of
executive vice president and chief financial officer of First
Data Corporation, a large financial services transactions
processor located in New Jersey. Mr. Adrean joined Providian in
1990 as senior vice president, planning and corporate
development. Prior to becoming Providian Agency Group's
president, he was the Company's chief financial officer.
On April 24, 1995 the Company announced Joseph M. Tumbler,
president of Providian Capital Management(PCM), resigned to
accept a position as vice chairman at SunAmerica Inc., a
financial services company headquartered in Los Angeles,
California. Mr. Tumbler joined the Company in 1986 as executive
vice president of National Liberty Corporation, a subsidiary of
the Company. Prior to becoming president of PCM in 1989, he was
head of strategic planning and development for the Company.
On May 5, 1995 Board of Directors elected William R. Gernert as
president of PCM. Mr. Gernert joined the Company in 1980 and has
been promoted to a number of positions within PCM with increasing
responsibility, including investment officer and director of
private placements. He managed PCM's institutional marketing
between 1990 and 1992, became chief financial officer for the
business in 1992 and reassumed responsibility for the
institutional business, as well, in January 1995.
Item 6. Exhibits and Reports on Form 8-K
Exhibits: None
Reports: None
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.
Providian Corporation
(Registrant)
Date: May 12, 1995 Robert L. Walker
Senior Vice President - Finance
and Chief Financial Officer
Date: May 12, 1995 Steven T. Downey
Vice President and Controller
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS OF PROVIDIAN CORPORATION AND
SUBSIDIARIES AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS.
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<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<DEBT-HELD-FOR-SALE> 10,728,538<F1>
<DEBT-CARRYING-VALUE> 0
<DEBT-MARKET-VALUE> 0
<EQUITIES> 0
<MORTGAGE> 5,511,850<F2>
[LOANS] 2,780,958<F3>
<REAL-ESTATE> 74,192<F4>
<TOTAL-INVEST> 19,907,649
<CASH> 566,922
<RECOVER-REINSURE> 0
<DEFERRED-ACQUISITION> 1,497,438
<TOTAL-ASSETS> 24,979,942
<POLICY-LOSSES> 9,105,552<F5>
<UNEARNED-PREMIUMS> 0
<POLICY-OTHER> 0
<POLICY-HOLDER-FUNDS> 7,633,126
[DEPOSITS] 1,942,152<F6>
<NOTES-PAYABLE> 719,250
<COMMON> 115,325
0
100,000<F7>
<OTHER-SE> 2,243,292<F8>
<TOTAL-LIABILITY-AND-EQUITY> 24,979,942
295,411
<INVESTMENT-INCOME> 459,876
<INVESTMENT-GAINS> (34,156)
<OTHER-INCOME> 76,421<F9>
<BENEFITS> 434,423<F10>
<UNDERWRITING-AMORTIZATION> 59,131<F11>
<UNDERWRITING-OTHER> 175,883<F12>
<INCOME-PRETAX> 101,781
<INCOME-TAX> 30,652
<INCOME-CONTINUING> 69,687
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 69,687
<EPS-PRIMARY> 0.72
<EPS-DILUTED> 0
<RESERVE-OPEN> 0
<PROVISION-CURRENT> 0
<PROVISION-PRIOR> 0
<PAYMENTS-CURRENT> 0
<PAYMENTS-PRIOR> 0
<RESERVE-CLOSE> 0
<CUMULATIVE-DEFICIENCY> 0
<FN>
<F1>Includes Equity securities of $577,873.
<F2>Includes Commercial and Residential mortgage loans.
<F3>Consists of Consumer loans.
<F4>Included in Other investments in the Consolidated Statements of Financial
Condition.
<F5>Includes Benefit reserves and other policy liabilities.
<F6>Consists of Banking deposits.
<F7>Consists of Cumulative Monthly Income Preferred Stock issued by subsidiary.
<F8>Includes Additional paid-in capital, Net unrealized investment loss, Retained
earnings, Common stock held in treasury and Unearned restricted stock.
<F9>Includes Consumer loan servicing fees of $49,820.
<F10>Includes Benefits and claims and Increase in benefit and contract reserves.
<F11>Includes Amortization of deferred policy and loan acquistion costs, value of
insurance in force purchased and goodwill.
<F12>Includes Commissions, net and General ,adminstrative and other expenses, net.
</FN>
</TABLE>
