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 28,
1998
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
<PAGE>
Item 5. Other Events.
On July 28, 1998, 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, 1998.
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 28, 1998
regarding certain of its unaudited
financial results for the three- and six-month periods
ended June 30, 1998.
<PAGE>
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 31, 1998 By: /s/ GEORGE W. SCHMIDT
George W. Schmidt
Controller and Assistant
Secretary
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
99 Earnings Release issued by American General
Finance Corporation on July 28, 1998
regarding certain of its unaudited
financial results for the three- and six-month periods
ended June 30, 1998.
AMERICAN GENERAL FINANCE
P. O. BOX 59
EVANSVILLE, IN 47701
NEWS RELEASE
Contact: Bryan A. Binyon, Treasurer
(812) 468-5195
AMERICAN GENERAL FINANCE CORPORATION
REPORTS INCREASED EARNINGS
FOR SECOND QUARTER 1998
Highlights for the quarter:
Operating earnings increase 9%
Total portfolio grows
Credit quality strengthens
EVANSVILLE, IN, JULY 28, 1998 - American General Finance Corporation reports
second quarter 1998 operating earnings of $47 million, a 9% increase over the
same period last year. The improved results are attributable to continued
asset growth and improved portfolio credit quality.
Finance receivables grew by more than $500 million during the second quarter
bringing total net receivables to more than $8.4 billion. The growth was led
by an increase in real estate receivables, which represent 55% of American
General Finance's total receivables portfolio as of June 30, 1998.
Continued credit quality improvements were a significant contributor to the
earnings increase as net charge-offs for the quarter improved to 2.63%
compared to 3.70% for the second quarter 1997. The 60-day+ delinquency ratio
also improved to 3.45% at June 30, 1998 compared to 3.52% at March 31, 1998.
The allowance for losses at June 30, 1998 remained strong at 4.21%.
Management believes the strong results for 1998 evidence the success of the
company's past and current focus on quality growth. With a network of nearly
1,300 branches and its strengthened operations and technology, American
General Finance is well positioned for continued profitable growth and
favorable returns in today's highly competitive financial services industry.
American General Finance Corporation and its subsidiaries are engaged in the
consumer finance and credit insurance business. The company, headquartered in
Evansville, Indiana, has assets of $10.0 billion and operates 1,299 offices in
40 states, Puerto Rico, and the U.S. Virgin Islands. Products and services
are provided to more than 2 million low-to-middle income American families.
The company offers direct consumer and home equity loans, retail sales
financing, and other credit-related products.
All statements, trend analyses, and other information contained in this report
and elsewhere (such as other filings by the company with the Securities and
Exchange Commission, press releases, presentation by the company or its
management, or oral statements) relative to markets for the company's products
and trends in the company's operations or financial results, as well as other
statements including words such as "anticipate," "believe," "plan,"
"estimate," "expect," "intend," and other similar expressions, constitutes
forward-looking statements under the Private Securities Litigation Reform Act
of 1995. Forward-looking statements are made based upon management's current
expectations and beliefs concerning future developments and their potential
effects upon the company. There can be no assurance that future developments
affecting the company will be those anticipated by management. Actual results
may differ materially from these included in the forward-looking statements.
These forward-looking statements involve risks and uncertainties including,
but not limited to, the following: (1) changes in general economic
conditions, including the performance of financial markets and interest rates;
(2) customer responsiveness to both new products and distribution channels;
(3) competitive, regulatory, or tax changes that affect the cost of or demand
for the company's products; (4) the company's ability to render its computer
systems Year 2000 compliant; (5) adverse litigation results or resolution of
litigation, including market conduct litigation; and other cost-saving
initiatives. Investors are also directed to other risks and uncertainties
discussed in documents filed by the company with the Securities and Exchange
Commission. The company undertakes no obligation to update or revise any
forward-looking information, whether as a result of new information, future
developments, or otherwise.
<PAGE>
American General Finance Corporation
FINANCIAL HIGHLIGHTS:
(Dollars in Millions, Annualized Percentages)
For the Three Months For the Six Months
Ended June 30 Ended June 30
1998 1997 1998 1997
Total Revenues $393 $377 $779 $757
Interest Expense 122 110 241 220
Operating Expenses 124 115 247 229
Provision for Finance Receivable
Losses 50 62 98 128
Insurance Benefits
and Losses 22 22 44 46
Total Expenses $318 $309 $630 $623
Pretax Operating Earnings 75 68 149 134
Income Tax Expense 28 25 56 49
Operating Earnings 47 43 93 85
Loss on Sale of Non-Strategic
Assets - (27) - (27)
Net Income $47 $16 $93 $58
Finance Charge Yield 16.11% 16.94% 16.29% 17.01%
Charge-off Ratio 2.63% 3.70% 2.67% 3.77%
Risk-Adjusted Yield 13.48% 13.24% 13.62% 13.24%
Return on Assets 1.96% 0.70% 1.97% 1.25%
Return on Equity 13.27% 4.69% 13.23% 8.48%
AT: 06/30/98 06/30/97
Total Assets $9,956 $8,643
Real Estate Loans 4,649 3,608
Non-Real Estate Loans 2,516 2,448
Retail Sales Finance 1,273 1,171
Total Net Finance Receivables $8,438 $7,227
Allowance for Finance
Receivable Losses 2Q98 2Q97
Balance at Beginning of Period $358 $380
Provision for Finance Receivable
Losses 50 62
Charge-offs, Net of Recoveries (52) (66)
Balance at End of Period $356 $376
06/30/98 06/30/97
Allowance as a % of
Net Finance Receivables 4.21% 5.20%
60-Day+ Delinquency Ratios 06/30/98 06/30/97
Real Estate Loans 2.75% 2.46%
Non-Real Estate Loans 5.29% 6.00%
Retail Sales Finance 2.15% 2.64%
Total Net Finance Receivables 3.45% 3.74%
