CONFORMED COPY
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
February 13, 1998
Date of Report .............................................................
(Date of earliest event reported)
CHRYSLER FINANCIAL CORPORATION
............................................................................
(Exact name of registrant as specified in its charter)
State of Michigan 333-31093 38-2997412
............................................................................
(State or other jurisdiction (Commission) (IRS Employer
of incorporation) File No.) Identification No.)
27777 Franklin Rd., Southfield, Michigan 48034
..............................................
(Address of principal executive offices)
(248) 948-3067
Registrant's telephone number, including area code..........................
This filing relates to Registration Statement No. 333-31093.
<PAGE>
Item 5. Other Events.
In connection with the proposed offering of Premier Auto Trust
1998-1, Asset Backed Notes, Class A-2, Class A-3, Class A-4, and Class B,
attached as Exhibit 99 are certain materials prepared by Chrysler Financial
Corporation that are required to be filed pursuant to the no-action letter
dated May 20, 1994 issued by the staff of the Securities and Exchange
Commission (the "Commission") to Kidder, Peabody Acceptance Corporation-1,
Kidder, Peabody & Co. Incorporated and Kidder Structured Asset Corporation
and the no-action letter dated February 15, 1995 issued by the staff of the
Commission to the Public Securities Association.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
Listed below are the financial statements, pro forma financial
information and exhibits, if any, filed as a part of this Report:
(a) Financial statements of businesses acquired;
None
(b) Pro forma financial information:
None
(c) Exhibits:
Exhibit 99
- 2 -
<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 hereunto duly authorized.
CHRYSLER FINANCIAL CORPORATION
Date: February 16, 1998 By: /s/ B.C. Babbish
-------------------
B.C. Babbish
Assistant Secretary
- 3 -
<PAGE>
EXHIBIT INDEX
Exhibit
No. Description of Exhibit
- ------- ----------------------
99 Material prepared by Chrysler Financial Corporation in
connection with Premier Auto Trust 1998-1 pursuant to the
no-action letter dated May 20, 1994 issued by the staff of
the Securities and Exchange Commission (the "Commission")
to Kidder, Peabody Acceptance Corporation-1, Kidder,
Peabody & Co. Incorporated and Kidder Structured Asset
Corporation and the no-action letter dated February 15,
1995 issued by the staff of the Commission to the Public
Securities Association.
- 4 -
EXHIBIT 99
Premier Auto Trust 1998-1 Structural and Collateral Materials
<PAGE>
[EXCLUSIVELY FOR SALOMON BROTHERS INC]
Computational Materials
Premier Auto Trust 1998-1 Retail Auto ABS
-----------------------------------------------------------------------------
$1,025,000,000 Retail Auto Asset-Backed Notes
Chrysler Financial Corporation
Seller and Servicer
$400,000,000 Class A-2 [ ]% Asset-Backed Notes
$270,000,000 Class A-3 [ ]% Asset-Backed Notes
$308,125,000 Class A-4 [ ]% Asset-Backed Notes
$46,875,000 Class B [ ]% Asset-Backed Notes
Computational
Materials
Neither the Issuer of the Notes nor any of its affiliates make any
representation as to the accuracy or completeness of the information herein.
The information herein is preliminary, and will be superseded by the
applicable prospectus supplement and by any other information subsequently
filed with the Securities and Exchange Commission. The information addresses
only certain aspects of the applicable security's characteristics and thus
does not provide a complete assessment. As such, the information may not
reflect the impact of all structural characteristics of the security. The
assumptions underlying the information, including structure and collateral,
may be modified from time to time to reflect changed circumstances. The
attached term sheet is not intended to be a prospectus and any investment
decision with respect to the Notes should be made by you based solely upon
all of the information contained in the final prospectus. Under no
circumstances shall the information presented constitute an offer to sell or
the solicitation of an offer to buy nor shall there be any sale of the
securities in any jurisdiction in which such offer,
<PAGE>
solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of such jurisdiction. The securities may not be
sold nor may an offer to buy be accepted prior to the delivery of a final
prospectus relating to the securities. All information described herein is
preliminary, limited in nature and subject to completion or amendment. No
representation is made that the above referenced securities will actually
perform as described in any scenario presented. The Depositors have not
prepared, reviewed or participated in the preparation hereof, are not
responsible for the accuracy hereof and have not authorized the dissemination
hereof. A final prospectus and prospectus supplement may be obtained by
contacting the Salomon Brothers Syndicate Desk at (212) 783-3727.
2
<PAGE>
[EXCLUSIVELY FOR BEAR STEARNS]
The information contained in the attached materials is referred to
as the "Information".
The attached Term Sheet has been prepared by Chrysler Financial
Corporation ("CFC"). Neither Bear, Stearns & Co. Inc. ("Bear Stearns") nor
any of its affiliates makes any representation as to the accuracy or
completeness of the Information herein. The Information contained herein is
preliminary and will be superseded by the applicable prospectus supplement
and by any other information subsequently filed with the Securities and
Exchange Commission.
The Information contained herein will be superseded by the
description of the collateral pool contained in the prospectus supplement
relating to the securities.
The Information addresses only certain aspects of the applicable
security's characteristics and thus does not provide a complete assessment.
As such, the Information may not reflect the impact of all structural
characteristics of the security. The assumptions underlying the Information,
including structure and collateral, may be modified from time to time to
reflect changed circumstances.
Although a registration statement (including the prospectus)
relating to the securities discussed in this communication has been filed
with the Securities and Exchange Commission and is effective, the final
prospectus supplement relating to the securities discussed in this
communication has not been filed with the Securities and Exchange Commission.
This communication shall not constitute an offer to sell or the solicitation
of an offer to buy nor shall there be any sale of the securities discussed in
this communication in any state in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the securities
laws of any such state. Prospective purchasers are referred to the final
prospectus and prospectus supplement relating to the securities discussed in
this communication for definitive Information on any matter discussed in this
communication. Any investment decision should be based only on the data in
the prospectus and the prospectus supplement ("Offering Documents") and the
then current version of the Information. Offering Documents contain data that
is current as of their publication dates and after publication may no longer
be complete or current. A final prospectus and prospectus supplement may be
obtained by contacting the Bear Stearns Trading Desk at 212-272-4955.
General Information: The data underlying the Information has been
obtained from sources that we believe are reliable, but we do not guarantee
the accuracy of the underlying data or computations based thereon. Bear
Stearns and/or individuals thereof may have positions in these securities
while the Information is circulating or during such period may engage in
transactions with the issuer or its affiliates. We act as principal in
transactions with you, and accordingly, you must determine the
appropriateness for you of such transactions and address any legal, tax or
accounting considerations applicable to you. Bear Stearns shall not be a
fiduciary or advisor
3
<PAGE>
unless we have agreed in writing to receive compensation specifically to act
in such capacities. If you are subject to ERISA, the Information is being
furnished on the condition that it will not form a primary basis for any
investment decision. The Information is not a solicitation of any transaction
in securities which may be made only by prospectus when required by law, in
which event you may obtain such prospectus from Bear Stearns by calling the
telephone number listed above.
4
<PAGE>
The information contained in the attached materials is referred to
as the "Information".
The attached Term Sheet has been prepared by Chrysler Financial
Corporation ("CFC"). Neither [Name of Underwriter] ("[Name of Underwriter]")
nor any of its affiliates makes any representation as to the accuracy or
completeness of the Information herein. The Information contained herein is
preliminary and will be superseded by the applicable prospectus supplement
and by any other information subsequently filed with the Securities and
Exchange Commission.
The Information contained herein will be superseded by the
description of the collateral pool contained in the prospectus supplement
relating to the securities.
The Information addresses only certain aspects of the applicable
security's characteristics and thus does not provide a complete assessment.
As such, the Information may not reflect the impact of all structural
characteristics of the security. The assumptions underlying the Information,
including structure and collateral, may be modified from time to time to
reflect changed circumstances.
Although a registration statement (including the prospectus)
relating to the securities discussed in this communication has been filed
with the Securities and Exchange Commission and is effective, the final
prospectus supplement relating to the securities discussed in this
communication has not been filed with the Securities and Exchange Commission.
This communication shall not constitute an offer to sell or the solicitation
of an offer to buy nor shall there be any sale of the securities discussed in
this communication in any state in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the securities
laws of any such state. Prospective purchasers are referred to the final
prospectus and prospectus supplement relating to the securities discussed in
this communication for definitive Information on any matter discussed in this
communication. Any investment decision should be based only on the data in
the prospectus and the prospectus supplement ("Offering Documents") and the
then current version of the Information. Offering Documents contain data that
is current as of their publication dates and after publication may no longer
be complete or current. A final prospectus and prospectus supplement may be
obtained by contacting the [Name of Underwriter]'s Trading Desk at __________.
5
<PAGE>
Premier Auto Trust 1998-1
Chrysler Financial Corporation, Seller and Servicer
Subject to Revision
Term Sheet dated February 16, 1998
Issuer.................................... Premier Auto Trust 1998-1 (the
"Trust" or the "Issuer").
The Notes................................. (i) Class A-1 _____% Asset Backed
Notes (the "Class A-1 Notes") in
the aggregate initial principal
amount of $225,000,000. The Class
A-1 Notes are not being offered
hereby;
(ii) Class A-2 ____% Asset Backed
Notes (the "Class A-2 Notes") in
the aggregate initial principal
amount of $400,000,000;
(iii) Class A-3 _____% Asset
Backed Notes (the "Class A-3
Notes") in the aggregate initial
principal amount of $270,000,000;
(iv) Class A-4 _____% Asset
Backed Notes (the "Class A-4
Notes" and, together, with the
Class A-1 Notes, Class A-2 Notes
and Class A- 3 Notes, the "Class
A Notes") in the aggregate
initial principal amount of
$308,125,000; and
(v) Class B __% Asset Backed
Notes (the "Class B Notes" and
together with the Class A Notes,
the "Notes") in the aggregate
initial principal amount of
$46,875,000. The Class B Notes
are subordinated to the Class A
Notes to the extent described
herein.
Terms of the Notes:
A. Distribution Dates.................. Payments of interest and principal
on the Notes will be made on the
sixth day of each month or, if
any such day is not a Business
Day, on the next succeeding
Business Day (each, a
"Distribution Date"), commencing
March 6, 1998.
B. Interest Rates...................... The Notes will have fixed interest
rates.
C. Interest............................ Interest on the outstanding
principal amount of any Class of
Notes, other than the Class A-1
Notes, will accrue at the
applicable Interest Rate from the
Closing Date (in the case of the
first Distribution Date) or from
the sixth day of the month
preceding the month of a
Distribution Date to and
including the fifth day of the
month of such Distribution Date
(each, an "Interest Accrual
Period"). Interest on the
outstanding principal amount of
the Class A-1 Notes will accrue
at the applicable Interest Rate
from the Closing Date (in the
case of the first Distribution
Date) or from the most recent
Distribution Date on which
interest has been paid to but
excluding the following
Distribution Date (each, a "Class
A-1 Interest Accrual Period").
Interest on each class of Notes,
other than the Class A-1 Notes,
will be calculated on the basis
of a 360-day year consisting of
twelve 30-day months. Interest on
the Class A-1 Notes will be
1
<PAGE>
calculated on the basis of the
actual number of days in the
Class A-1 Interest Accrual Period
divided by 360. The failure to
pay interest on the Class B Notes
will not be an Event of Default
unless the Class A-4 Notes have
been paid in full.
D. Principal........................... Except during the Release Period
described below under
"Overcollateralization and
Release of Initial
Overcollateralization Amount",
principal of the Notes will be
payable on each Distribution Date
in an amount equal to the
Noteholders' Principal
Distributable Amount for the
calendar month (the "Collection
Period") preceding such
Distribution Date to the extent
of funds available therefor. The
"Noteholders' Principal
Distributable Amount" will equal
(i) the Regular Principal
Distribution Amount plus (ii) the
Accelerated Principal
Distribution Amount. The "Regular
Principal Distribution Amount"
with respect to any Distribution
Date will generally equal the
amount of principal paid plus the
principal balance of liquidated
defaulted Receivables. The
"Accelerated Principal
Distribution Amount" with respect
to a Distribution Date will equal
the portion, if any, of the Total
Distribution Amount for the
related Collection Period that
remains after payment of (a) the
Servicing Fee (together with any
portion of the Servicing Fee that
remains unpaid from prior
Distribution Dates), (b) the
interest due on the Notes, (c)
the Regular Principal
Distribution Amount, and (d) the
amount, if any, required to be
deposited in the Reserve Account
on such Distribution Date.
During the Release Period, the
principal of the Notes payable on
each Distribution Date will equal
the Release Period Noteholders'
Principal Distributable Amount
described below under
"Overcollateralization and
Release of Initial
Overcollateralization Amount".
No principal payments will be
made (i) on the Class A-2 Notes
until the Class A-1 Notes have
been paid in full; (ii) on the
Class A-3 Notes until the Class
A-2 Notes have been paid in full;
(iii) on the Class A-4 Notes
until the Class A-3 Notes have
been paid in full; or (iv) on the
Class B Notes until the Class A-4
Notes have been paid in full.
The outstanding principal amount
of the Class A-1 Notes, to the
extent not previously paid, will
be payable on the November 1998
Distribution Date (the "Class A-1
Final Scheduled Distribution
Date"); the outstanding principal
amount of the Class A-2 Notes, to
the extent not previously paid,
will be payable on the September
2000 Distribution Date (the
"Class A-2 Final Scheduled
Distribution Date"); the
outstanding principal amount of
the Class A-3 Notes, to the
extent not previously paid, will
be payable on the August 2001
Distribution Date (the "Class A-3
Final Scheduled Distribution
Date"); the outstanding principal
amount of the Class A-4 Notes, to
the extent not previously paid,
will be payable on the October
2002 Distribution Date (the
"Class A-4 Final Scheduled
Distribution Date"); and the
outstanding principal amount of
the Class B Notes, to the extent
not previously paid, will be
2
<PAGE>
payable on the October 2004
Distribution Date (the "Class B
Final Scheduled Distribution
Date").
E. Optional Redemption................. The outstanding Class A-4 Notes
and Class B Notes will be subject
to redemption in whole, but not
in part, on any Distribution Date
by Chrysler Financial Corporation
("CFC") when the Pool Balance
shall have declined to 10% or
less of the Initial Pool Balance
(as defined below).
Overcollateralization and Release of
Initial Overcollateralization Amount..... The initial aggregate principal
balance of the Receivables as of
February 11, 1998 (the "Cutoff
Date") ($1,306,253,258.79) (the
"Initial Pool Balance") will
exceed the initial aggregate
principal amount of the Notes
($1,250,000,000.00) (the "Initial
Note Principal Balance") by an
amount equal to $56,253,258.79
(the "Initial
Overcollateralization Amount"),
which is approximately 4.5% of
the Initial Note Principal
Balance. Unless offset by losses
on the Receivables or the release
of cash during the Release Period
as described below, the
distribution of the Accelerated
Principal Distribution Amount, if
any, on a Distribution Date is
expected to cause the aggregate
principal amount of the Notes to
decrease faster than the Pool
Balance decreases, thereby
increasing the
Overcollateralization Amount. The
"Overcollateralization Amount" in
respect of a Distribution Date is
equal to (a) the Pool Balance as
of the end of the related
Collection Period (the "Related
Pool Balance") minus (b) the
aggregate outstanding amount of
Notes after giving effect to
payments made on the Notes on
such Distribution Date (the "Note
Amount").
Subject to the conditions set
forth below, on each Distribution
Date during the Release Period
(as defined below), the amount of
principal distributable on the
Notes will be the Release Period
Noteholders' Principal
Distributable Amount rather than
the Noteholders' Principal
Distributable Amount. The
"Release Period Noteholders'
Principal Distributable Amount"
shall equal, on any Distribution
Date during the Release Period,
the excess of (a) the Note Amount
on such Distribution Date (prior
to giving effect to any
distributions on such
Distribution Date) over (b) the
product of (1) 95.0% and (2) the
Related Pool Balance. On each
Distribution Date during the
Release Period, any portion of
the Total Distributable Amount
which remains after payment of
(a) the Servicing Fee, (b) the
Noteholders' Interest
Distributable Amount, (c) the
Release Period Noteholders'
Principal Distributable Amount
and (d) any amount required to
increase the amount in the
Reserve Account to the Specified
Reserve Account Balance will be
released to the Trust and then to
Premier Receivables L.L.C. (the
"Company") (such released amount
being the "Cash Release Amount"
or "Cash Release"). The
cumulative amount of all Cash
Releases during the Release
Period shall not exceed the
Initial Overcollateralization
Amount.
3
<PAGE>
The release of cash to the Trust,
and then to the Company, as
described above is subject to the
satisfaction of all of the
following conditions:
(1) No Cash Release will be
permitted until the date (the
"First Release Distribution
Date") that is the later of
(a) the Distribution Date
following the Distribution
Date on which the
Overcollateralization Amount
is at least equal to:
[Initial Overcollateralization
Amount]
plus
[2% x (Related Pool Balance
for such preceding
Distribution Date
minus
Initial Overcollateralization
Amount)]
and (b) the Distribution Date
following the Distribution
Date on which the Class A-1
Notes have been repaid in
full.
(2) (a) The amount in the
Reserve Account shall be equal
to the applicable Specified
Reserve Account Balance and
(b) the cumulative amount of
the Cash Releases will not
exceed the Initial
Overcollateralization Amount.
On the Distribution Date (the
"Last Release Distribution Date")
on which the cumulative amount of
the Cash Releases equals the
Initial Overcollateralization
Amount, the amount of principal
distributable to the Noteholders
will be the Noteholders'
Principal Distributable Amount
less the Cash Release Amount
released on such Distribution
Date. On each Distribution Date
thereafter, the full Noteholders'
Monthly Principal Distributable
Amount will be distributable as
principal to the Noteholders. The
"Release Period" is the period
from the First Release
Distribution Date to the Last
Release Distribution Date. Any
Cash Release released to the
Company will not be available to
make payments on the Notes.
Reserve Account........................... The "Reserve Account" will be
created with an initial deposit
by CFC on the Closing Date of
cash or Eligible Investments
having a value at least equal to
$12,500,000 (the "Specified
Reserve Account Amount"), which
is 1.00% of the Initial Note
Principal Balance. If the
Overcollateralization Percentage
at any time on or after the Last
Release Distribution Date equals
at least 7.75%, the Specified
Reserve Account Balance will be
$9,375,000 which is 0.75% of the
Initial Note Principal Balance.
The "Overcollateralization
Percentage" in respect of a
Distribution Date is the
percentage derived from a
fraction, the numerator of which
is the Overcollateralization
Amount for such Distribution date
and the denominator of which is
the Related Pool Balance.
Funds will be withdrawn from the
Reserve Account to cover any
shortfalls in the amounts due to
the Noteholders. On each
Distribution Date, the Reserve
Account will be reinstated up to
the Specified Reserve
4
<PAGE>
Account Balance to the extent of
the portion, if any, of the Total
Distribution Amount remaining
after payment of the Servicing
Fee and the amounts due to the
Noteholders.
The "Pool Balance" at any time
will represent the aggregate
principal balance of the
Receivables at the end of the
preceding Collection Period,
after giving effect to all
payments received from Obligors
and Purchase Amounts to be
remitted by the Servicer or the
Seller, as the case may be, all
for such Collection Period, and
all losses realized on
Receivables liquidated during
such Collection Period.
Priority of Payments;
Subordination of Class B Notes............ Collections in respect of the
Receivables for each Collection
Period will be applied in the
following order of priority: (i)
the Servicing Fee, together with
any previously unpaid Servicing
Fees, (ii) amounts payable to the
Noteholders, which amounts will
be applied, first, to pay
interest and principal on the
Class A Notes and, second, to pay
interest and principal on the
Class B Notes, (iii) amounts, if
any, to the Reserve Account up to
the Specified Reserve Account
Balance, and (iv) the remaining
balance, if any, to the Company.
In addition, Cash Releases will
be made as described above under
"Overcollateralization and
Release of Initial
Overcollateralization Amount".
Rating of the Notes....................... The Class A Notes will be rated
in the highest investment rating
category by at least two
nationally recognized rating
agencies. The Class B Notes will
be rated at least in the "A"
category or its equivalent by
such rating agencies.
5
<PAGE>
The Receivables Pool
As of the Cutoff Date, each Receivable (i) had a principal balance
of at least $300 and (ii) was not more than 30 days past due (an account is
not considered past due if the amount past due is less than 10% of the
scheduled monthly payment). As of the Cutoff Date, no Obligor on any
Receivable was noted in the related records of the Seller as being the
subject of a bankruptcy proceeding, and no Obligor on any Receivable financed
a Financed Vehicle under the Seller's "New-Finance Buyer Plan" program. No
selection procedures believed by the Seller to be adverse to Noteholders were
used in selecting the Receivables.
Set forth in the following tables is information concerning the
composition, distribution by annual percentage rate ("APR") and the
geographic distribution of the Receivables Pool as of the Cutoff Date.
<TABLE>
<CAPTION>
Premier Auto Trust 1998-1
Composition of the Receivables Pool
Weighted
Average Weighted Average
Weighted Average Aggregate Principal Number of Remaining Average Principal
APR of Receivables Balance Receivables Term Original Term Balance
- -------------------- ------------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
9.12% $1,306,253,258.79 75,870 58.31 months 59.80 months $17,216.99
</TABLE>
Approximately 77.68% of the aggregate principal balance of the
Receivables, constituting 70.09% of the number of the Receivables, represent
new vehicles, and approximately 22.32% of the aggregate principal balance of
the Receivables, constituting 29.91% of the number of the Receivables,
represent used vehicles. Approximately 86.59% of the aggregate principal
balance of the Receivables represent vehicles manufactured or distributed by
Chrysler and approximately 13.41% of the Initial Pool Balance represents
financing of vehicles manufactured or distributed by vehicle manufacturers
other than Chrysler. All of the Receivables are Simple Interest Receivables.
6
<PAGE>
<TABLE>
<CAPTION>
Premier Auto Trust 1998-1
Distribution by APR of the Receivables Pool
- -------------------------------------------- ------------------------------------------------------------------
APR Range Number of Aggregate Percent of Aggregate
Receivables Principal Balance Principal Balance(1)
- -------------------------------------------- ------------------------------------------------------------------
<S> <C> <C> <C>
0.00% to 5.00%.............................. 11,013 $ 183,490,890.67 14.0%
5.01% to 6.00%.............................. 4,547 107,330,776.84 8.2
6.01% to 7.00%.............................. 568 10,384,459.56 0.8
7.01% to 8.00%.............................. 7,561 128,095,725.69 9.8
8.01% to 9.00%.............................. 11,748 206,358,760.56 15.8
9.01% to 10.00%............................. 11,348 201,274,779.71 15.4
10.01% to 11.00%............................ 8,165 148,569,404.66 11.4
11.01% to 12.00%............................ 6,296 108,140,767.99 8.3
12.01% to 13.00%............................ 4,509 71,045,340.16 5.4
13.01% to 14.00%............................ 2,899 43,176,993.49 3.3
14.01% to 15.00%............................ 2,127 29,688,560.03 2.3
15.01% to 16.00%............................ 1,246 17,606,889.39 1.3
16.01% to 17.00%............................ 957 13,290,183.03 1.0
17.01% to 18.00%............................ 1,513 21,550,213.68 1.6
Greater than 18.00%......................... 1,373 16,249,513.33 1.2
------ ----------------- -----
Totals................................. 75,870 $1,306,253,258.79 100.0%
====== ================= =====
<FN>
- ---------------
(1) Percentages may not add to 100.0% because of rounding.
</TABLE>
7
<PAGE>
<TABLE>
<CAPTION>
Premier Auto Trust 1998-1
Geographic Distribution of the Receivables Pool(1)
Percent of Percent of
Aggregate Aggregate
Principal Principal
State Balance(2) State Balance(2)
- ----- ---------- ----- ----------
<S> <C> <S> <C>
Alabama.................... 1.1% Montana................ 0.2%
Alaska..................... 0.4 Nebraska............... 0.8
Arizona.................... 2.1 Nevada................. 0.6
Arkansas................... 0.9 New Hampshire.......... 1.3
California................. 6.0 New Jersey............. 4.3
Colorado................... 1.3 New Mexico............. 0.8
Connecticut................ 1.2 New York............... 5.8
Delaware................... 0.4 North Carolina......... 2.7
District of Columbia....... 0.0 North Dakota........... 0.3
Florida.................... 5.6 Ohio................... 1.5
Georgia.................... 2.8 Oklahoma............... 1.2
Hawaii..................... 0.2 Oregon................. 1.5
Idaho...................... 0.2 Pennsylvania........... 6.1
Illinois................... 5.0 Rhode Island........... 0.4
Indiana.................... 2.2 South Carolina......... 1.3
Iowa....................... 0.8 South Dakota........... 0.3
Kansas..................... 1.6 Tennessee.............. 1.2
Kentucky................... 1.4 Texas.................. 7.7
Louisiana.................. 1.1 Utah................... 0.4
Maine...................... 0.4 Vermont................ 0.2
Maryland................... 5.1 Virginia............... 3.6
Massachusetts.............. 2.5 Washington............. 2.1
Michigan................... 4.6 West Virginia.......... 0.7
Minnesota.................. 2.3 Wisconsin.............. 1.9
Mississippi................ 0.4 Wyoming................ 0.2
Missouri................... 3.6 -----
Totals.............. 100.0%
=====
<FN>
- ------------------
(1) Based on physical addresses of the dealers originating the receivables.
(2) Percentages may not add to 100.0% because of rounding.
</TABLE>
Delinquencies, Repossessions and Net Losses
Set forth below is certain information concerning the experience
of CFC and its United States subsidiaries pertaining to retail new and used
automobile and light duty truck receivables, including those previously sold
which CFC continues to service. There can be no assurance that the
delinquency, repossession and net loss experience on the Receivables will be
comparable to that set forth below.
8
<PAGE>
<TABLE>
<CAPTION>
Delinquency Experience(1)
(Dollars in Millions)
At December 31,
---------------------------------------------------------------------------------------
1997 1996 1995
---------------------------- ----------------------------- -------------------------
Number of Number of Number of
Contracts Amount Contracts Amount Contracts Amount
------------ ------------- ------------ -------------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Portfolio ............ 1,697,755 $ 21,879 1,679,880 $ 21,197 1,653,533 $ 20,913
Period of Delinquency
31-60 Days ......... 58,421 $ 708 65,297 $ 843 55,507 $ 720
61 Days or More .... 7,360 102 8,175 118 6,792 100
--------- --------- --------- --------- --------- ---------
Total Delinquencies .. 65,781 $ 810 73,472 $ 961 62,299 $ 820
Total Delinquencies as
a Percent of the
Portfolio .......... 3.87% 3.70% 4.37% 4.53% 3.77% 3.92%
<CAPTION>
At December 31,
---------------------------------------------------------------------------------------
1994 1993 1992
---------------------------- ----------------------------- -------------------------
Number of Number of Number of
Contracts Amount Contracts Amount Contracts Amount
------------ ------------- ------------ -------------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Portfolio ............ 1,444,736 $ 16,977 1,352,218 $ 14,116 1,344,799 $ 12,082
Period of Delinquency
31-60 Days ......... 25,888 $ 293 16,350 $ 153 15,964 $ 134
61 Days or More .... 2,085 27 1,383 15 1,376 13
--------- --------- --------- --------- --------- ---------
Total Delinquencies .. 27,973 $ 320 17,733 $ 168 17,340 $ 147
Total Delinquencies as
a Percent of the
Portfolio .......... 1.94% 1.88% 1.31% 1.19% 1.29% 1.22%
<FN>
- --------------------------
(1) All amounts and percentages are based on the gross amount
scheduled to be paid on each contract, including unearned finance
and other charges. The information in the table includes an
immaterial amount of retail installment sale contracts on vehicles
other than automobiles and light duty trucks and includes
previously sold contracts which CFC continues to service.
</TABLE>
9
<PAGE>
<TABLE>
<CAPTION>
Credit Loss/Repossession Experience(1)
(Dollars in Millions)
Year Ended December 31,
----------------------------------------------------------------------------
1997 1996 1995 1994 1993 1992
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Average Amount Outstanding
During the Period ............. $21,485 $21,062 $19,486 $15,517 $12,882 $11,818
Average Number of Contracts
Outstanding During the Period . 1,688,525 1,671,405 1,572,963 1,396,497 1,341,084 1,382,898
Percent of Contracts Acquired
During the Period with Recourse
to the Dealer ................. 10.91% 9.05% 14.8% 17.0% 16.2% 15.8%
Repossessions as a Percent of
Average Number of Contracts
Outstanding .............. 3.40% 3.82% 3.05% 2.36% 2.15% 2.31%
Net Losses as a Percent of
Liquidations (2)(3) .......... 3.36% 3.17% 2.25% 1.38% 1.34% 1.71%
Net Losses as a Percent of
Average Amount Outstanding(2) . 1.80% 1.68% 1.16% 0.73% 0.75% 0.97%
<FN>
- --------------------
(1) Except as indicated, all amounts and percentages are based on the gross
amount scheduled to be paid on each contract, including unearned finance
and other charges. The information in the table includes an immaterial
amount of retail installment sales contracts on vehicles other than
automobiles and light duty trucks and includes previously sold contracts
that CFC continues to service.
(2) Net losses are equal to the aggregate of the balances of all contracts
which are determined to be uncollectible in the period, less any
recoveries on contracts charged off in the period or any prior periods,
including any losses resulting from disposition expenses and any losses
resulting from the failure to recover commissions to dealers with respect
to contracts that are prepaid or charged off.
(3) Liquidations represent a reduction in the outstanding balances of the
contracts as a result of monthly cash payments and charge-offs.
</TABLE>
During 1997, CFC experienced high credit losses on automotive retail
receivables. CFC management attributes the credit losses to the combined
effect of the credit mix of retail receivable originations and the increase
in frequency of default and repossession necessitating an increase in the
level of servicing and collection by CFC. While credit loss experience may
continue, actions have been taken to improve credit mix, collections and
servicing of the retail receivable portfolio. However, no assurance can be
given as to future results.
The net loss figures above reflect the fact that the Seller had
recourse to Dealers on a portion of its retail installment sale contracts. By
aggregate principal balance, approximately 2.03% of the Receivables represent
contracts with recourse to Dealers.
10
