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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
Date of Report (Date of earliest event reported): July 23, 1996
AMERICAN GENERAL FINANCE CORPORATION
(Exact Name of Registrant as Specified in Charter)
Indiana 1-6155 35-0416090
(State or Other (Commission File (IRS Employer
Jurisdiction of Number) Identification
Incorporation) No.)
601 N.W. Second Street, Evansville, IN 47708
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (812) 424-8031
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Item 5. Other Events.
On July 23, 1996, American General Finance Corporation (the "Company")
issued an Earnings Release announcing certain unaudited financial results of
the Company for the three- and six-month periods ended June 30, 1996.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
(c) Exhibits. The following Exhibit is filed as part of this Report:
Exhibit
Number Description
99 Earnings Release issued by American General Finance
Corporation on July 23, 1996 regarding certain of its
unaudited financial results for the three- and six-
month periods ended June 30, 1996.
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SIGNATURE
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.
AMERICAN GENERAL FINANCE CORPORATION
Dated: July 24, 1996 By: /S/ GEORGE W. SCHMIDT
George W. Schmidt
Controller and Assistant
Secretary
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EXHIBIT INDEX
Exhibit
Number Description
99 Earnings Release issued by American General
Finance Corporation on July 23, 1996 regarding
certain of its unaudited financial results for
the three- and six-month periods ended June 30,
1996.
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Contact: Bryan A. Binyon, Treasurer
(812) 468-5195
AMERICAN GENERAL FINANCE CORPORATION
REPORTS RESULTS FOR SECOND QUARTER 1996
HIGHLIGHTS:
- - Increase in loans secured by real estate of $200 million since year end
- - Continued improvement in delinquency and charge off
- - Allowance for finance receivable losses remains strong
- - Year-to-date earnings on plan
EVANSVILLE, IN, JULY 23, 1996.--American General Finance Corporation's results
for the second quarter of 1996 were in line with management expectations
producing net income of $34 million compared to 1995 second quarter net income
of $64 million.
Since year-end 1995, the continued emphasis on credit quality has produced
more than $200 million of real estate secured receivables growth and lower
volumes in previously fast-growing non-real estate, retail sales finance and
credit card receivables. Overall, total finance receivables increased $37
million in the second quarter but dropped $343 million since year-end 1995.
At the end of the second quarter, real estate secured receivables accounted
for 38.5% of the entire portfolio, compared to 34.4% at year-end 1995.
While delinquencies and charge-offs are expected to remain above historical
levels throughout 1996, 60-day+ delinquencies improved to 4.01% from 4.15% at
year-end. The second quarter charge off rate was 5.4% of receivables compared
to 5.5% for the first quarter and 6.0% for the 1995 fourth quarter. These
improvements are viewed favorably, but the company is continuing to maintain a
conservative outlook by holding the allowance for finance receivable losses at
6.0% at the end of the second quarter.
Since late 1995, underperforming marketing initiatives have either been
restructured or discontinued. Certain non-recurring expenses associated with
the discontinued initiatives negatively impacted the financial results for the
second quarter. The strategic review of operations and the decrease in
receivables during the year resulted in a second quarter workforce reduction
of approximately 450 positions throughout the U.S., primarily through
attrition. Management believes the improvement programs implemented in late
1995 and throughout 1996 will continue to address the overall credit quality
issues, lead to expense reductions, and build a strong foundation for improved
future results.
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American General Finance Corporation and its subsidiaries are engaged in the
consumer finance and related credit insurance business. The company,
headquartered in Evansville, Indiana, has assets of $9.1 billion and operates
1,372 offices in 39 states, Puerto Rico, and the U.S. Virgin Islands.
Products and services are provided to over 3 million low-to-middle income
American families. The company offers direct consumer and home equity loans,
retail sales financing, credit cards, and credit and non-credit insurance.
Certain information included in this press release is forward looking and
involves risks and uncertainties, including general economic and competitive
conditions that could significantly impact expected results. Investors are
also directed to other risks and uncertainties discussed in documents filed by
the company with the Securities and Exchange Commission.
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FINANCIAL HIGHLIGHTS: AGFC
(Dollars in Millions, Annualized Percentages)
Quarter Quarter Six Months Six Months
Ended Ended Ended Ended
6-30-96 6-30-95 6-30-96 6-30-95
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Revenues:
Finance Charges $353 $369 $715 $727
Insurance 52 57 103 111
Other 22 30 45 48
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Total Revenues $427 $456 $863 $886
Net Income $34 $64 $64 $126
Finance Charge Yield 18.12% 17.94% 18.12% 17.94%
Charge-Off Ratio 5.38% 2.94% 5.46% 2.88%
Return on Assets 1.51% 2.73% 1.40% 2.72%
Return on Equity 9.59% 18.11% 8.91% 18.09%
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At: 6/30/96 12/31/95
- ------ ------- --------
Total Assets $9,091 $9,485
Real Estate Loans $3,022 $2,817
Non-Real Estate Loans 2,466 2,694
Retail Sales Contracts 1,006 1,189
Private Label 845 943
Credit Cards 519 558
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Total Net Finance Receivables $7,858 $8,201
Allowance for Finance Receivable Losses 2Q96 1995
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Balance at beginning of period $477 $226
Provision for finance receivable losses 100 574
Charge-offs, net of recoveries (105) (311)
Other - (7)
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Balance at end of period $472 $482
60-Day+ Delinquency Ratios 6/30/96 12/31/95
- -------------------------- -------- --------
Real Estate Loans 2.10% 2.01%
Non-Real Estate Loans 6.26 6.37
Retail Sales Contracts 2.91 3.01
Private Label 4.85 4.77
Credit Cards 4.50 4.85
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Total 4.01% 4.15%
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