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 quarterly period ended June 30, 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 1-6594
--------------------
COMMERCIAL CREDIT COMPANY
(Exact name of registrant as specified in its charter)
Delaware 52-0883351
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
300 St. Paul Place, Baltimore, Maryland 21202
(Address of principal executive offices) (Zip Code)
(410) 332-3000
(Registrant's telephone number, including area code)
--------------------
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
----- -----
The registrant is an indirect wholly owned subsidiary of Travelers Group
Inc. As of the date hereof, one share of the registrant's Common Stock,
$.01 par value, was outstanding.
REDUCED DISCLOSURE FORMAT
THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION
H(1)(a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM 10-Q WITH
THE REDUCED DISCLOSURE FORMAT.
<PAGE>
Commercial Credit Company and Subsidiaries
TABLE OF CONTENTS
-----------------
Part I - Financial Information
Item 1. Financial Statements: Page No.
--------
Condensed Consolidated Statement of Income (Unaudited) -
Three and Six Months Ended June 30, 1995 and June 30, 1994 3
Condensed Consolidated Statement of Financial Position -
June 30, 1995 (Unaudited) and December 31, 1994 4
Condensed Consolidated Statement of Cash Flows (Unaudited) -
Six Months Ended June 30, 1995 and June 30, 1994 5
Notes to Condensed Consolidated Financial Statements - (Unaudited) 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
Part II - Other Information
Item 6. Exhibits and Reports on Form 8-K 13
Exhibit Index 14
Signatures 15
2
<PAGE>
<TABLE><CAPTION>
Commercial Credit Company and Subsidiaries
Condensed Consolidated Statement of Income (Unaudited)
(In millions of dollars)
Three months ended Six months ended
June 30, June 30,
1995 1994 1995 1994
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenues
Finance related interest and other charges $277.6 $252.6 $548.5 $498.2
Insurance premiums 32.3 94.8 63.4 185.2
Net investment income 12.3 19.0 24.5 36.5
Other income 25.1 26.1 44.1 56.9
---------------------------------------------------------------------------------------------------------------
Total revenues 347.3 392.5 680.5 776.8
---------------------------------------------------------------------------------------------------------------
Expenses
Interest 116.7 97.1 230.1 190.3
Policyholder benefits and claims 12.4 58.8 24.2 114.5
Insurance underwriting, acquisition and operating 7.0 24.4 13.3 48.3
Non-insurance compensation and benefits 49.0 45.0 98.4 91.2
Provision for credit losses 41.2 38.2 80.8 77.0
Other operating 36.8 37.2 76.2 76.5
---------------------------------------------------------------------------------------------------------------
Total expenses 263.1 300.7 523.0 597.8
---------------------------------------------------------------------------------------------------------------
Income before income taxes and minority interest 84.2 91.8 157.5 179.0
Provision for income taxes 30.0 31.8 56.2 62.7
---------------------------------------------------------------------------------------------------------------
Income before minority interest 54.2 60.0 101.3 116.3
Minority interest, net of income taxes - (3.8) - (7.5)
---------------------------------------------------------------------------------------------------------------
Net income $ 54.2 $ 56.2 $ 101.3 $108.8
===============================================================================================================
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
3
<PAGE>
<TABLE><CAPTION>
Commercial Credit Company and Subsidiaries
Condensed Consolidated Statement of Financial Position
(In millions of dollars, except per share amounts)
June 30, 1995 December 31,1994
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Assets (Unaudited)
Cash and cash equivalents $ 20.7 $ 23.6
Investments:
Fixed maturities:
Available for sale, at market value (cost - $732.0 and $713.6) 736.2 673.4
Equity securities, at market value (cost - $24.7 and $20.7) 25.9 19.6
Mortgage loans 180.4 173.0
Short-term and other 46.3 36.6
---------------------------------------------------------------------------------------------------------------------
Total investments 988.8 902.6
---------------------------------------------------------------------------------------------------------------------
Consumer finance receivables 7,143.5 6,927.7
Allowance for losses (187.8) (181.9)
---------------------------------------------------------------------------------------------------------------------
Net consumer finance receivables 6,955.7 6,745.8
Other receivables 160.4 216.4
Deferred policy acquisition costs 21.8 18.3
Cost of acquired businesses in excess of net assets 100.1 102.1
Other assets 258.2 218.0
---------------------------------------------------------------------------------------------------------------------
Total assets $8,505.7 $8,226.8
=====================================================================================================================
Liabilities
Certificates of deposit $ 65.8 $ 73.5
Short-term borrowings 1,381.2 2,304.6
Long-term debt 5,100.0 4,010.0
---------------------------------------------------------------------------------------------------------------------
Total debt 6,547.0 6,388.1
Insurance policy and claims reserves 388.6 386.5
Accounts payable and other liabilities 382.6 339.8
---------------------------------------------------------------------------------------------------------------------
Total liabilities 7,318.2 7,114.4
---------------------------------------------------------------------------------------------------------------------
Stockholder's equity
Common stock ($.01 par value; authorized shares: 1,000; share issued: 1) - -
Additional paid-in-capital 163.5 163.5
Retained earnings 1,020.8 974.5
Unrealized gain (loss) on investments 3.5 (25.3)
Cumulative translation adjustments (.3) (.3)
---------------------------------------------------------------------------------------------------------------------
Total stockholder's equity 1,187.5 1,112.4
---------------------------------------------------------------------------------------------------------------------
Total liabilities and stockholder's equity $8,505.7 $8,226.8
=====================================================================================================================
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
4
<PAGE>
<TABLE><CAPTION>
Commercial Credit Company and Subsidiaries
Condensed Consolidated Statement of Cash Flows (Unaudited)
(In millions of dollars)
Six months ended June 30, 1995 1994
------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Cash Flows From Operating Activities
Income before income taxes and minority interest $ 157.5 $ 179.0
Adjustments to reconcile income before income taxes and minority interest to
net cash provided by (used in) operating activities:
Amortization of deferred policy acquisition costs and value of insurance in force 3.0 27.2
Additions to deferred policy acquisition costs (6.4) (36.4)
Provision for credit losses 80.8 77.1
Changes in:
Insurance policy and claims reserves 2.1 49.9
Other, net 47.9 (82.2)
------------------------------------------------------------------------------------------------------------------
Net cash provided by operations 284.9 214.6
Income taxes (paid) (50.5) (76.6)
------------------------------------------------------------------------------------------------------------------
Net cash provided by operating activities 234.4 138.0
------------------------------------------------------------------------------------------------------------------
Cash Flows From Investing Activities
Net change in credit card receivables (22.1) (7.1)
Loans originated or purchased (1,360.2) (1,429.5)
Loans repaid or sold 1,069.9 1,071.1
Purchases of investments (225.9) (412.9)
Proceeds from sales of investments 176.0 323.9
Proceeds from maturities of investments 3.4 154.5
Redemption of Parent Company Series Z preferred stock - 100.0
Other, net 17.7 7.5
------------------------------------------------------------------------------------------------------------------
Net cash (used in) investing activities (341.2) (192.5)
------------------------------------------------------------------------------------------------------------------
Cash Flows From Financing Activities
Dividends paid (55.0) (90.0)
Issuance of long-term debt 1,600.0 -
Payments of long-term debt (510.0) (243.8)
Net change in short-term borrowings (923.4) 368.2
Net change in certificates of deposit (7.7) 13.6
------------------------------------------------------------------------------------------------------------------
Net cash provided by financing activities 103.9 48.0
------------------------------------------------------------------------------------------------------------------
Change in cash and cash equivalents (2.9) (6.5)
Cash and cash equivalents at beginning of period 23.6 25.6
------------------------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of period $ 20.7 $ 19.1
==================================================================================================================
Supplemental disclosure of cash flow information:
Cash paid during the period for interest $ 210.5 $196.1
==================================================================================================================
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
5
<PAGE>
Commercial Credit Company and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Unaudited)
(In millions of dollars)
1. Basis of Presentation
---------------------
Commercial Credit Company (the Company) is a wholly owned subsidiary of
CCC Holdings, Inc. which is a wholly owned subsidiary of Travelers
Group Inc. (the Parent). The condensed consolidated financial
statements include the accounts of the Company and its subsidiaries.
On December 30, 1994 the Company sold its remaining 50% interest in
Commercial Insurance Resources, Inc., the parent of Gulf Insurance
Company (Gulf), to an affiliate, The Travelers Indemnity Company, for
$150 in cash and accordingly results of operations for 1995 do not
include Gulf's results. The exclusion of Gulf's operations from 1995
results of operations has resulted in a reduction compared to the 1994
period in insurance-related revenues and expenses. The remaining
insurance-related revenues and expenses represent the credit insurance
activities of the Company's other insurance subsidiaries, the
operations of which are reflected in the Consumer Finance segment.
The accompanying condensed consolidated financial statements as of June
30, 1995 and for the three-month and six-month periods ended June 30,
1995 and 1994 are unaudited. In the opinion of management, all
adjustments, consisting of normal recurring adjustments, necessary for
a fair presentation have been reflected. The accompanying condensed
consolidated financial statements should be read in conjunction with
the consolidated financial statements and related notes included in the
Company's Annual Report on Form 10-K for the year ended December 31,
1994.
Certain financial information that is normally included in annual
financial statements prepared in accordance with generally accepted
accounting principles but is not required for interim reporting
purposes has been condensed or omitted.
FAS 114 and FAS 118. Effective January 1, 1995 the Company adopted
Statement of Financial Accounting Standards No. 114, "Accounting by
Creditors for Impairment of a Loan," and Statement of Financial
Accounting Standards No. 118, "Accounting by Creditors for Impairment
of a Loan - Income Recognition and Disclosures," which describe how
impaired loans should be measured when determining the amount of a loan
loss accrual. These Statements amended existing guidance on the
measurement of restructured loans in a troubled debt restructuring
involving a modification of terms. These Statements do not apply to
large groups of smaller-balance homogeneous loans that are collectively
evaluated for impairment, such as the Company's portfolio of consumer
finance receivables, and their adoption did not have a material impact
on the Company's financial condition, results of operations or
liquidity.
6
<PAGE>
Notes to Condensed Consolidated Financial Statements (continued)
2. Consumer Finance Receivables
----------------------------
Consumer finance receivables, net of unearned finance charges of $695.0
and $673.7 at June 30, 1995 and December 31, 1994, respectively,
consisted of the following:
June 30, 1995 December 31, 1994
------------- -----------------
Real estate-secured loans $2,917.1 $2,844.7
Personal loans 3,009.4 2,874.7
Credit cards 734.6 712.5
Sales finance and other 441.9 453.5
-------- --------
Consumer finance receivables 7,103.0 6,885.4
Accrued interest receivable 40.5 42.3
Allowance for credit losses (187.8) (181.9)
-------- -------
Net consumer finance receivables
$6,955.7 $6,745.8
======= =======
3. Debt
----
The Company issues commercial paper directly to investors and maintains
unused credit availability under its bank lines of credit at least
equal to the amount of its outstanding commercial paper. At June 30,
1995 and December 31, 1994, short-term borrowings consisted of
commercial paper totaling $1,381.2 and $2,304.6, respectively. The
Company may borrow under its revolving credit facility at various
interest rate options and compensates the banks for the facilities
through commitment fees. The Parent, the Company and The Travelers
Insurance Company (TIC) have an agreement with a syndicate of banks to
provide $1,200 of revolving credit, to be allocated to any of the
Parent, the Company or TIC. The revolving credit facility consists of
a five-year revolving credit facility which expires in 1999. At June
30, 1995, $520 was allocated to the Company.
At June 30, 1995, the Company had a committed and available revolving
credit facility on a stand-alone basis of $1,760 which expires in 1999.
The Company is limited by covenants in its revolving credit agreements
as to the amount of dividends and advances that may be made to the
Parent or its affiliated companies. At June 30, 1995, the Company
would have been able to remit $291.4 to the Parent under its most
restrictive covenants.
7
<PAGE>
Notes to Condensed Consolidated Financial Statements (continued)
The Company completed the following long-term debt offerings during the
first six months of 1995 and, as of August 10, 1995, had $750 available
for debt offerings under its shelf registration statement:
- 7 7/8% Notes due February 1, 2025. . . . . . . . . . . $200
- 7 3/4% Notes due March 1, 2005 . . . . . . . . . . . . $200
- 7 3/8% Notes due March 15, 2002 . . . . . . . . . . . $200
- 7 3/8% Notes due April 15, 2005 . . . . . . . . . . . $200
- 6 7/8% Notes due May 1, 2002 . . . . . . . . . . . . . $200
- 6 3/4% Notes due May 15, 2000 . . . . . . . . . . . . $200
- 6 5/8% Notes due June 1, 2015 . . . . . . . . . . . . $200
- 6 1/2% Notes due June 1, 2005 . . . . . . . . . . . . $200
4. Related Party Transactions
--------------------------
To facilitate cash management the Company has entered into an agreement
with the Parent under which the Company or the Parent may borrow from
the other party at any time an amount up to the greater of $50.0 or 1%
of the Company's consolidated assets up to a maximum of $100.0. The
agreement may be terminated by either party at any time. The interest
rate to be charged on borrowings outstanding will be equivalent to an
appropriate market rate.
8
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION and ANALYSIS of FINANCIAL CONDITION
and RESULTS of OPERATIONS
Consolidated Results of Operations
Three Months Ended Six Months Ended
June 30, June 30,
--------------------- -----------------------
(In millions) 1995 1994 1995 1994
---------------------------------------------- -----------------------
Revenues $347.3 $392.5 $680.5 $776.8
===== ===== ===== =====
Net income $ 54.2 $ 56.2 $101.3 $108.8
===== ===== ===== =====
Results of Operations
On December 30, 1994 Commercial Credit Company ("the Company") sold its
remaining 50% interest in Commercial Insurance Resources, Inc., the parent
of Gulf Insurance Company (Gulf), to an affiliate, The Travelers Indemnity
Company, for $150 million in cash and accordingly results of operations for
1995 do not include Gulf's results. The exclusion of Gulf's operations
from 1995 results of operations has resulted in a reduction compared to the
1994 period in insurance-related revenues and expenses. The remaining
insurance-related revenues and expenses represent the credit insurance
activities of the Company's other insurance subsidiaries, the operations of
which are reflected in the Consumer Finance segment.
The net income of the Company for the quarter ended June 30, 1995 was $54.2
million compared to $56.2 million in the corresponding 1994 period. Income
before income taxes and minority interest for the quarter ended June 30,
1995 was $84.2 million compared to $91.8 million in the corresponding 1994
period. Revenues for the quarter ended June 30, 1995 were $347.3 million
compared to $392.5 million in the corresponding 1994 period, reflecting the
impact of the sale referred to above.
The net income of the Company for the six months ended June 30, 1995 was
$101.3 million compared to $108.8 million in the corresponding 1994 period.
Income before income taxes and minority interest for the six months ended
June 30, 1995 was $157.5 million compared to $179.0 million in the
corresponding 1994 period. Revenues for the six months ended June 30, 1995
were $680.5 million compared to $776.8 million in the corresponding 1994
period, also reflecting the impact of the sale referred to above.
The following discussion presents in more detail each segment's
performance.
Segment Results for the Three Months Ended June 30, 1995 and 1994
-----------------------------------------------------------------
Consumer Finance Services
Three Months Ended June 30,
------------------------------------------------
(In millions) 1995 1994
--------------------------------------------------------------------------
Revenues Net income Revenues Net income
--------------------------------------------------------------------------
Consumer Finance Services $337.1 $60.0 $302.5 $54.6
==========================================================================
9
<PAGE>
The 10% increase in Consumer Finance net income in the second quarter of
1995 over the same period last year reflects continued growth in
receivables outstanding and an improvement in net interest margins for the
segment. Receivables outstanding (before allowance for losses and accrued
interest receivable) totaled $7.103 billion at the end of the second
quarter of 1995 reflecting a 7% increase over June 30, 1994. Receivables
growth has been at a somewhat slower pace than in 1994, and could be
adversely affected by increasing first mortgage refinancings in the latter
half of 1995. Proceeds of such refinancings are sometimes used by the
borrowers to pay off second mortgages in the consumer finance portfolio.
The average yield on the portfolio was up 29 basis points from a year ago,
to 15.57%. Net interest margin increased 7 basis points to 8.69%,
reflecting the higher yield offset somewhat by a higher cost of funds to
the segment.
The charge-off rate, which is expected to trend up from the record low
levels in 1994, was 2.14% for the quarter versus 2.07% in the comparable
1994 period, but down slightly from 2.16% in the 1995 first quarter. 60+
day delinquencies were relatively even with last year at 1.86% though up
slightly from 1.83% in the first quarter of 1995.
Since the beginning of the year, the number of branches increased by 49,
bringing the total number of offices to 877 at quarter end.
As of, and for, the
Three Months Ended June 30,
------------------------------
1995 1994
------------------------------
Allowance for losses as % of
consumer finance receivables 2.64% 2.64%
Charge-off rate 2.14% 2.07%
60 + days past due on a contractual
basis as % of gross consumer
finance receivables at quarter end 1.86% 1.88%
Insurance Services
Three Months Ended June 30,
---------------------------------------------------
(In millions) 1995 1994
--------------------------------------------------------------------------------
Revenues Net income Revenues Net income
--------------------------------------------------------------------------------
Gulf $ - $ - $78.0 $7.7
Minority interest - Gulf - - - (3.8)
--------------------------------------------------------------------------------
Total Insurance Services $ - $ - $78.0 $ 3.9
================================================================================
As previously described, on December 30, 1994 the Company sold its
remaining 50% interest in Commercial Insurance Resources, Inc., the parent
of Gulf, to an affiliate, The Travelers Indemnity Company, for $150 million
in cash and accordingly results of operations for 1995 do not include
Gulf's results.
10
<PAGE>
Corporate and Other
Three Months Ended June 30,
------------------------------------------------------
(In millions) 1995 1994
--------------------------------------------------------------------------------
Revenues Net income Revenues Net income
(expense) (expense)
--------------------------------------------------------------------------------
Corporate and other $10.2 $(5.8) $12.0 $(2.3)
================================================================================
The increase in Corporate and Other net expense for the second quarter of
1995 compared to the second quarter of 1994 is primarily attributable to
increases in interest costs borne at the corporate level.
Segment Results for the Six Months Ended June 30, 1995 and 1994
---------------------------------------------------------------
The overall operating trends for the six months ended June 30, 1995 and
1994 were substantially the same as those of the second quarter periods
except as noted below.
Consumer Finance Services
Six Months Ended June 30,
-------------------------------------------------
(In millions) 1995 1994
--------------------------------------------------------------------------------
Revenues Net income Revenues Net income
--------------------------------------------------------------------------------
Consumer Finance Services $660.4 $115.5 $601.8 $105.8
================================================================================
The average yield on the portfolio was up 25 basis points from a year ago,
to 15.50%. Net interest margin increased 10 basis points to 8.67%,
reflecting the higher yield offset somewhat by a higher cost of funds to
the segment. The charge-off rate for the first half of 1995 was 2.15%,
compared to 2.16% in the 1994 period.
Insurance Services
Six Months Ended June 30,
-----------------------------------------------
(In millions) 1995 1994
--------------------------------------------------------------------------------
Revenues Net income Revenues Net income
--------------------------------------------------------------------------------
Gulf $ - $ - $152.4 $15.1
Minority interest - Gulf - - - (7.5)
--------------------------------------------------------------------------------
Total Insurance Services $ - $ - $152.4 $ 7.6
================================================================================
11
<PAGE>
Corporate and Other
Six Months Ended June 30,
----------------------------------------------------
(In millions) 1995 1994
------------------------------------------------------------------------------
Revenues Net income Revenues Net income
(expense) (expense)
------------------------------------------------------------------------------
Corporate and other $20.1 $(14.2) $22.6 $(4.6)
===============================================================================
The increase in Corporate and Other net expense for the first half of 1995
compared to the first half of 1994 is primarily attributable to increases
in interest costs borne at the corporate level.
Liquidity and Capital Resources
The Company issues commercial paper directly to investors and maintains
unused credit availability under committed revolving credit agreements at
least equal to the amount of commercial paper outstanding. The Company may
borrow under its revolving credit facilities at various interest rate
options and compensates the banks for the facilities through commitment
fees.
The Parent, the Company and The Travelers Insurance Company (TIC) have an
agreement with a syndicate of banks to provide $1.2 billion of revolving
credit, to be allocated to any of the Parent, the Company or TIC. The
revolving credit facility consists of a five-year revolving credit facility
which expires in 1999. At June 30, 1995, $520 million was allocated to the
Company. In addition at June 30, 1995, the Company had committed and
available revolving credit facilities on a stand-alone basis of $1.760
billion which expires in 1999.
As of June 30, 1995, the Company had unused credit availability of $2.280
billion under five-year revolving credit facilities.
The Company completed the following long-term debt offerings in 1995 and,
as of August 10, 1995, had $750 million available for debt offerings under
its shelf registration statement:
- 7 7/8% Notes due February 1, 2025 . . . . . . $200 million
- 7 3/4% Notes due March 1, 2005 . . . . . . . . $200 million
- 7 3/8% Notes due March 15, 2002 . . . . . . . $200 million
- 7 3/8% Notes due April 15, 2005 . . . . . . . $200 million
- 6 7/8% Notes due May 1, 2002 . . . . . . . . . $200 million
- 6 3/4% Notes due May 15, 2000 . . . . . . . . $200 million
- 6 5/8% Notes due June 1, 2015 . . . . . . . . $200 million
- 6 1/2% Notes due June 1, 2005 . . . . . . . . $200 million
The Company is limited by covenants in its revolving credit agreements as
to the amount of dividends and advances that may be made to the Parent or
its affiliated companies. At June 30, 1995, the Company would have been
able to remit $291.4 million to the Parent under its most restrictive
covenants.
12
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits:
See Exhibit Index.
(b) Reports on Form 8-K:
On April 17, 1995, the Company filed a Current Report on
Form 8-K, dated April 17, 1995, reporting under Item 5 thereof the results
of its operations for the three months ended March 31, 1995, and certain
other selected financial data.
On April 19, 1995, the Company filed a Current Report on
Form 8-K, dated April 17, 1995, filing certain exhibits under Item 7
thereof relating to the offer and sale of the Company's 7 3/8% Notes due April
15, 2005.
On May 9, 1995, the Company filed a Current Report on Form
8-K, dated May 5, 1995, filing certain exhibits under Item 7 thereof
relating to the offer and sale of the Company's 6 7/8% Notes due May 1, 2002.
On May 18, 1995, the Company filed a Current Report on Form
8-K, dated May 16, 1995, filing certain exhibits under Item 7 thereof
relating to the offer and sale of the Company's 6 3/4% Notes due May 15, 2000.
On June 1, 1995, the Company filed a Current Report on Form
8-K, dated May 30, 1995, filing certain exhibits under Item 7 thereof
relating to the offer and sale of the Company's 6 5/8% Notes due June 1, 2015.
On June 7, 1995, the Company filed a Current Report on Form
8-K, dated June 2, 1995, filing certain exhibits under Item 7 thereof
relating to the offer and sale of the Company's 6 1/2% Notes due June 1, 2005.
On June 22, 1995, the Company filed a Current Report on Form
8-K, dated June 20, 1995, filing certain exhibits under Item 7 thereof
relating to the commencement of the Company's Medium-Term Note Program.
No other reports on Form 8-K have been filed by the Company
during the quarter ended June 30, 1995; however, on July 17, 1995, the
Company filed a Current Report on Form 8-K, dated July 17, 1995, reporting
under Item 5 thereof the results of its operations for the three months and
six months ended June 30, 1995, and certain other selected financial data.
13
<PAGE>
EXHIBIT INDEX
-------------
<TABLE><CAPTION>
Exhibit Filing
Number Description of Exhibit Method
------ ---------------------- ------
<S> <C>
3.01 Restated Certificate of Incorporation of Commercial Credit
Company (the "Company"), included in Certificate of Merger of
CCC Merger Company into the Company; Certificate of Ownership
and Merger merging CCCH Acquisition Corporation into the
Company; and Certificate of Ownership and Merger merging RDI
Service Corporation into the Company, incorporated by reference
to Exhibit 3.01 to the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1992 (File No. 1-6594).
3.02 By-laws of the Company, as amended May 14, 1990, incorporated
by reference to Exhibit 3.02.2 to the Company's Annual Report
on Form 10-K for the fiscal year ended December 31, 1990 (File
No. 1-6594).
4.01.1 Indenture, dated as of December 1, 1986 (the "Indenture"),
between the Company and Citibank, N.A., relating to the
Company's debt securities, incorporated by reference to Exhibit
4.01 to the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1988 (File No. 1-6594).
4.01.2 First Supplemental Indenture, dated as of June 13, 1990, to the
Indenture, incorporated by reference to Exhibit 1 to the
Company's Current Report on Form 8-K dated June 13, 1990 (File
No. 1-6594).
The total amount of securities authorized pursuant to
any other instrument defining rights of holders of
long-term debt of the Company does not exceed 10% of
the total assets of the Company and its consolidated
subsidiaries. The Company will furnish copies of any
such instrument to the Securities and Exchange
Commission upon request.
12.01 Computation of Ratio of Earnings to Fixed Charges. Electronic
27.01 Financial Data Schedule. Electronic
</TABLE>
14
<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.
Commercial Credit Company
Date: August 11, 1995 By /s/ William R. Hofmann
-----------------------------
William R. Hofmann
Vice President
(Principal Financial Officer)
Date: August 11, 1995 By /s/ Irwin Ettinger
-----------------------------
Irwin Ettinger
Senior Vice President
15
Exhibit 12.01
Commercial Credit Company and Subsidiaries
Computation of Ratio of Earnings to Fixed Charges
(In millions of dollars, except for ratio)
Six months ended June 30,
--------------------------
1995 1994
---- ----
Income before income taxes and minority interest $157.5 $179.0
Elimination of undistributed equity earnings (0.6) (0.5)
Pre-tax minority interest - (10.3)
Interest 230.1 190.3
Portion of rentals deemed to be interest 4.7 5.5
----- -----
Earnings available for fixed charges $391.7 $364.0
===== =====
Fixed charges
-------------
Interest $230.1 $ 190.3
Portion of rentals deemed to be interest 4.7 5.5
----- -----
Fixed charges $234.8 $195.8
===== =====
Ratio of earnings to fixed charges 1.67x 1.86x
==== ====
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
Exhibit 27.01
Commercial Credit Company
Financial Data Schedule
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
JUNE 30, 1995 FINANCIAL STATEMENTS OF COMMERCIAL CREDIT COMPANY AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<CASH> 20,700
<SECURITIES> 988,800<F1>
<RECEIVABLES> 7,303,900<F2>
<ALLOWANCES> (187,800)
<INVENTORY> 0<F3>
<CURRENT-ASSETS> 0<F3>
<PP&E> 0<F3>
<DEPRECIATION> 0<F3>
<TOTAL-ASSETS> 8,505,700
<CURRENT-LIABILITIES> 0<F3>
<BONDS> 6,547,000<F4>
<COMMON> 0<F3>
0
0
<OTHER-SE> 1,187,500<F5>
<TOTAL-LIABILITY-AND-EQUITY> 8,505,700
<SALES> 0<F3>
<TOTAL-REVENUES> 680,500
<CGS> 0<F3>
<TOTAL-COSTS> 523,000
<OTHER-EXPENSES> 0<F3>
<LOSS-PROVISION> 80,800<F6>
<INTEREST-EXPENSE> 230,100<F6>
<INCOME-PRETAX> 157,500
<INCOME-TAX> 56,200
<INCOME-CONTINUING> 101,300
<DISCONTINUED> 0<F3>
<EXTRAORDINARY> 0<F3>
<CHANGES> 0<F3>
<NET-INCOME> 101,300
<EPS-PRIMARY> 0<F3>
<EPS-DILUTED> 0<F3>
<FN>
<F1> Includes the following items from the financial statements: total
investments $988,800.
<F2> Includes the following items from the financial statements: consumer
finance receivables $7,143,500 and other receivables $160,400.
<F3> Items which are inapplicable relative to the underlying financial
statements are indicated with a zero as required.
<F4> Includes the following items from the financial statements: certificates
of deposit $65,800; short-term borrowings $1,381,200 and long-term debt
$5,100,000.
<F5> Includes the following items from the financial statements: additional
paid-in capital $163,500; retained earnings $1,020,800; unrealized gain
(loss) on investments $3,500; and cumulative translation adjustment
$(300).
<F6> Included in total costs and expenses applicable to sales and revenues.
</FN>
</TABLE>
