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 quarterly period ended April 30, 1998
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission File Number 1-4146-1
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NAVISTAR FINANCIAL CORPORATION
(Exact name of Registrant as specified in its charter)
Delaware 36-2472404
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
2850 West Golf Road Rolling Meadows, Illinois 60008
(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code 847-734-4000
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
APPLICABLE ONLY TO ISSUERS INVOLVED
IN BANKRUPTCY PROCEEDINGS DURING
THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15 (d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes No
APPLICABLE ONLY TO CORPORATE ISSUERS:
As of May 31, 1998, the number of shares outstanding of the registrant's common
stock was 1,600,000.
THE REGISTRANT IS A WHOLLY-OWNED SUBSIDIARY OF NAVISTAR INTERNATIONAL
TRANSPORTATION CORP. AND MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTIONS
H(1)(a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED
DISCLOSURE FORMAT.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
INDEX
Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements:
Statements of Consolidated Income and Retained Earnings --
Three Months and Six Months Ended April 30, 1998 and 1997...... 2
Statements of Consolidated Financial Condition --
April 30, 1998; October 31, 1997; and April 30, 1997........... 3
Statements of Consolidated Cash Flow --
Six Months Ended April 30, 1998 and 1997....................... 4
Notes to Consolidated Financial Statements..................... 5
Item 2. Management's Discussion and Analysis of Results of
Operations and Financial Condition............................. 7
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K............................... 11
Signature ............................................................. 11
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
NAVISTAR FINANCIAL CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED INCOME AND RETAINED EARNINGS (Unaudited)
(Millions of dollars)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
April 30 April 30
1998 1997 1998 1997
<S> <C> <C> <C> <C>
Revenue
Retail notes and lease financing . . $ 30.9 $ 26.2 $ 59.8 $ 51.9
Wholesale notes . . . . . . . . . . . 11.5 9.3 19.8 18.5
Accounts . . . . . . . . . . . . . . 7.1 7.1 16.7 14.3
Servicing fee income . . . . . . . . 5.0 4.5 10.7 10.1
Insurance premiums earned . . . . . . 8.0 8.1 15.9 16.5
Marketable securities . . . . . . . . 1.6 2.1 3.8 4.1
Total . . . . . . . . . . . . 64.1 57.3 126.7 115.4
Expense
Cost of borrowing
Interest . . . . . . . . . . . 20.3 17.2 36.0 31.5
Other . . . . . . . . . . . . . 1.6 1.4 3.5 3.0
Total . . . . . . . . . . . . 21.9 18.6 39.5 34.5
Credit, collection and administrative. 8.5 7.5 16.6 14.5
Provision for losses on receivables . 0.8 0.5 1.2 1.2
Insurance claims and underwriting . . 8.0 9.7 17.1 17.6
Depreciation and other . . . . . . . . 7.6 5.8 13.1 10.5
Total . . . . . . . . . . . . 46.8 42.1 87.5 78.3
Income Before Taxes on Income . . . . . 17.3 15.2 39.2 37.1
Taxes on Income . . . . . . . . . . . . 6.6 5.9 15.1 14.4
Net Income . . . . . . . . . . . . . . . 10.7 9.3 24.1 22.7
Retained Earnings
Beginning of period . . . . . . . . . 114.5 120.8 113.1 107.4
Dividends paid . . . . . . . . . . . . 15.0 30.0 27.0 30.0
End of period . . . . . . . . . . . . 110.2 $100.1 $110.2 $ 100.1
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
NAVISTAR FINANCIAL CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED FINANCIAL CONDITION (Unaudited)
(Millions of dollars)
<TABLE>
<CAPTION>
April 30 October 31 April 30
1998 1997 1997
ASSETS
<S> <C> <C> <C>
Cash and Cash Equivalents . . . . . . . $ 39.2 $ 10.7 $ 2.8
Marketable Securities . . . . . . . . . 113.3 114.2 122.3
Finance Receivables
Retail notes and lease financing . 772.4 706.5 681.1
Wholesale notes . . . . . . . . . 308.0 45.7 200.8
Accounts . . . . . . . . . . . . . 379.3 471.0 358.2
1,459.7 1,223.2 1,240.1
Allowance for losses . . . . . . . (12.2) (12.0) (12.0)
Finance Receivables, Net . . . 1,447.5 1,211.2 1,228.1
Amounts Due from Sales of Receivables . 211.1 233.3 209.1
Equipment on Operating Leases, Net . . 198.9 124.1 107.3
Repossessions . . . . . . . . . . . . . 13.8 13.0 29.9
Other Assets . . . . . . . . . . . . . 93.7 104.1 82.9
Total Assets . . . . . . . . . . . . . $2,117.5 $1,810.6 $1,782.4
LIABILITIES AND SHAREOWNER'S EQUITY
Short-Term Borrowings . . . . . . . . . $ 138.4 $ 141.0 $ 145.0
Net Payable to Affiliates . . . . . . . 84.0 131.5 126.2
Other Liabilities . . . . . . . . . . . 49.9 59.8 57.0
Senior and Subordinated Debt . . . . . 1,453.4 1,082.7 1,067.8
Dealers' Reserves . . . . . . . . . . . 23.2 22.2 22.0
Unpaid Insurance Claims and
Unearned Premiums . . . . . . . . . . 82.4 85.6 92.0
Shareowner's Equity
Capital stock (Par value $1.00, 1,600,000
shares issued and outstanding)
and paid-in capital . . . . . . . 171.0 171.0 171.0
Retained earnings . . . . . . . . 110.2 113.1 100.1
Unrealized gains on marketable
securities . . . . . . . . . . . 5.0 3.7 1.3
Total . . . . . . . . . . . . 286.2 287.8 272.4
Total Liabilities and
Shareowner's Equity . . . . . . . . . $2,117.5 $1,810.6 $1,782.4
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
NAVISTAR FINANCIAL CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CASH FLOW (Unaudited)
(Millions of dollars)
<TABLE>
<CAPTION>
Six Months Ended
April 30
1998 1997
<S> <C> <C>
Cash Flow From Operations
Net income . . . . . . . . . . . . . . . . . . . . $ 24.1 $ 22.7
Adjustments to reconcile net income to cash
provided from operations:
Gains on sales of receivables . . . . . . . . . (7.2) (6.9)
Depreciation and amortization . . . . . . . . . 15.2 10.8
Provision for losses on receivables . . . . . . 1.2 1.2
(Decrease)increase in net payable to affiliates. (47.5) 101.7
Other . . . . . . . . . . . . . . . . . . . . . (9.7) (13.3)
Total . . . . . . . . . . . . . . . . . . . (23.9) 116.2
Cash Flow From Investing Activities
Proceeds from sold retail notes . . . . . . . . . . . 465.3 481.0
Purchase of retail notes and lease receivables . . . (576.4) (424.7)
Principal collections on retail notes and
lease receivables . . . . . . . . . . . . . . . . 54.8 23.5
Acquisitions over cash collections of wholesale
notes and accounts receivable. . . . . . . . . . . (153.8) (71.1)
Purchase of marketable securities . . . . . . . . . (15.8) (46.5)
Proceeds from sales and maturities
of marketable securities . . . . . . . . . . . . . 19.3 53.9
Purchase of equipment leased to others . . . . . . . (90.9) (35.5)
Sale of equipment leased to others . . . . . . . . . 2.7 19.5
Total . . . . . . . . . . . . . . . . . . . (294.8) 0.1
Cash Flow From Financing Activities
Net (decrease) increase in short-term borrowings . . (2.6) 45.6
Net increase (decrease) in bank revolving
credit facility usage . . . . . . . . . . . . . . 302.0 (204.0)
Net increase in asset-backed commercial paper
facility usage . . . . . . . . . . . . . . . . . . 12.1 0.3
Proceeds from long-term debt . . . . . . . . . . . . 91.5 78.9
Principal payments of long-term debt . . . . . . . . (28.8) (11.0)
Dividends paid to Transportation . . . . . . . . . . (27.0) (30.0)
Total . . . . . . . . . . . . . . . . . . . 347.2 (120.2)
Increase (decrease) in Cash and Cash Equivalents . . . . 28.5 (3.9)
Cash and Cash Equivalents at Beginning of Period . . . . 10.7 6.7
Cash and Cash Equivalents at End of Period . . . . . . . $ 39.2 $ 2.8
Supplemental disclosure of cash flow information
Interest paid . . . . . . . . . . . . . . . . . . . $ 37.9 $ 32.1
Income taxes paid . . . . . . . . . . . . . . . . . $ 19.5 $ 15.3
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. The consolidated financial statements include the accounts of Navistar
Financial Corporation ("NFC") and its wholly-owned subsidiaries
("Corporation"). Navistar International Transportation Corp.
("Transportation"), which is wholly-owned by Navistar International
Corporation ("Navistar"), is the parent company of the Corporation.
The accompanying unaudited financial statements and notes have been
prepared in accordance with the accounting policies set forth in the
Corporation's 1997 Annual Report on Form 10-K and should be read in
conjunction with the Notes to the Consolidated Financial Statements
therein.
In the opinion of management, these interim financial statements reflect
all adjustments, consisting of normal recurring accruals, necessary to
present fairly the financial position, results of operations and cash flow
for the interim periods presented. Interim results are not necessarily
indicative of results to be expected for the full year. Certain 1997
amounts have been reclassified to conform with the presentation used in the
1998 financial statements.
2. Finance receivable balances do not include receivables sold by the
Corporation to public and private investors with limited recourse
provisions. Outstanding sold receivable balances are as follows:
<TABLE>
<CAPTION>
April 30 October 31 April 30
1998 1997 1997
($ Millions)
<S> <C> <C> <C>
Retail notes . . . . . . . . . . $1,417.7 $1,422.2 $1,373.7
Wholesale notes . . . . . . . . 500.0 545.5 400.0
Total . . . . . . . . . . . $1,917.7 $1,967.7 $1,773.7
</TABLE>
In November 1997, the Corporation sold $500 million of retail notes, net of
unearned finance income, through Navistar Financial Retail Receivables
Corporation (NFRRC) to an owner trust which, in turn, sold notes to
investors. A gain of $7.2 million was recognized on the sale. The proceeds
of $477 million, net of underwriting fees and credit enhancements, were
used by the Corporation for general working capital purposes.
In June 1998, the Corporation sold $501 million of retail notes, net of
unearned finance income, through NFRRC to an owner trust which, in turn,
sold notes to investors. A gain of $8.1 million was recognized on the sale.
The proceeds of $482 million, net of underwriting fees and credit
enhancements, were used by the Corporation for general working capital
purposes.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
The allowance for losses on receivables is summarized as follows:
<TABLE>
<CAPTION>
April 30 October 31 April 30
1998 1997 1997
($ Millions)
<S> <C> <C> <C>
Allowance pertaining to:
Owned notes . . . . . . . . . $12.2 $12.0 $12.0
Sold notes . . . . . . . . . 12.5 12.5 12.5
Total . . . . . . . . . . $24.7 $24.5 $24.5
</TABLE>
3. The Corporation entered into $400 million of forward treasury locks in
anticipation of a June 1998 sale of retail receivables. These hedge
agreements, which were closed in conjunction with the pricing of the sale,
resulted in an immaterial gain which was included in the gain on the sale.
The Corporation also entered into a $100 million forward treasury lock in
anticipation of a November 1998 sale of retail receivables. This hedge
agreement will be closed in conjunction with the pricing of the sale and
any resulting gain or loss will be included in the gain or loss on the sale
of receivables recognized in November 1998.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
AND FINANCIAL CONDITION
Certain statements under this caption constitute "forward-looking statements"
under the Securities Reform Act, which involve risks and uncertainties. Navistar
Financial Corporation's actual results may differ significantly from the results
discussed in such forward-looking statements. Factors that might cause such a
difference include, but are not limited to, those discussed under the heading
"Business Outlook".
Financing Volume
In the first half of fiscal 1998 industry retail sales for Class 5 through 8
trucks was approximately 14% higher than 1997. The Corporation's retail
financing acquisitions during the first six months of fiscal 1998, including
retail notes and finance and operating leases, were $667 million, 45% higher
than 1997. The increase is primarily the result of the strong truck industry
demand and an increase in the Corporation's finance market share of new
International trucks sold in the U.S. from 13.4% in 1997 to 15.9% in fiscal
1998. Serviced retail notes and lease financing balances were $2,394 million and
$2,169 million at April 31, 1998 and 1997, respectively.
In spite of the continued strong liquidity in the commercial financing market,
the Corporation provided 94% and 95% of the wholesale financing of new trucks
sold to Transportation's dealers in the first six months of fiscal 1998 and
1997, respectively. Serviced wholesale note balances were $892 million at April
30, 1998, a 33% increase compared to April 30, 1997 due to the strong industry
demand.
Results of Operations
The components of net income for the three and six month periods ended April 30
are as follows:
<TABLE>
<CAPTION>
Three Months Six Months
Ended April 30 Ended April 30
1998 1997 1998 1997
<S> <C> <C> <C> <C>
Income before income taxes:
Finance operations. . . . . . . . . . . $15.7 $14.9 $36.6 $34.4
Insurance operations. . . . . . . . . . 1.6 0.3 2.6 2.7
Income before taxes. . . . . . . . . 17.3 15.2 39.2 37.1
Taxes on income . . . . . . . . . . . . . 6.6 5.9 15.1 14.4
Net income . . . . . . . . . . . . . $10.7 $ 9.3 $24.1 $22.7
</TABLE>
During the second quarter of fiscal 1998, the Corporation's pretax income of $17
million was $2 million higher than the corresponding period of fiscal 1997. The
increase was due primarily to an increase in finance receivable balances
resulting from an increase in Transportation's sales offset, in part, by lower
financing margins due to the highly competitive commercial financing market.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
AND FINANCIAL CONDITION
Results of Operations (continued)
Finance Operations:
Pretax income during the first six months of 1998 increased $2 million to $39
million compared to the same period of 1997. During the first half of fiscal
1998, receivable balances were higher as a result of the increase in
Transportation's sales. The higher level of financing was partially offset by
lower financing margins primarily due to the highly competitive commercial
financing market.
Retail note and lease revenue increased $8 million to $60 million in the first
half of 1998 compared to 1997. The increase is primarily the result of higher
average finance receivables due to an increase in Transportation's retail sales
and an increase in operating lease balances due to a shift toward lease
financing. Included in retail note and lease revenue is operating lease revenue
of $20 million and $15 million in 1998 and 1997, respectively. For operating
leases, the Corporation recognizes the entire lease payment as revenue and
records depreciation expense on the assets under lease.
Wholesale note revenue increased to $20 million in the first half of 1998
compared to $19 million in fiscal 1997 due primarily to the higher level of
wholesale financing activity, partially offset by slightly lower yields.
Retail and wholesale account revenue was $17 million in the first half of 1998
compared to $14 million in 1997. The increase was primarily the result of higher
average balances.
Borrowing costs increased $5 million to $40 million during the first half of
1998 primarily as a result of higher average receivable funding requirements and
slightly higher market interest rates. The Corporation's weighted average
interest rate on all debt increased to 6.3% from 6.2% in the first six months of
1997.
Credit, collection and administrative expenses increased to $17 million during
the first six months of 1998 from $15 million in 1997. The increase in 1998 was
primarily due to employee related costs.
Depreciation and other expenses during the first six months of 1998 was $13
million compared to $11 million in the comparable period of 1997. The increase
is primarily the result of a larger investment in equipment under operating
leases.
Insurance Operations:
Harco National Insurance Company's pretax income in the first half of fiscal
1998 was comparable to that of 1997 as a slight decrease in earned premium
revenue was offset by improved loss experience.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
AND FINANCIAL CONDITION
Liquidity and Funds Management
The Corporation's operations are substantially dependent upon the production and
sale of Transportation's truck products in the United States. The Corporation
has traditionally obtained the funds to provide financing to Transportation's
dealers and retail customers from sales of receivables, commercial paper, short
and long-term bank borrowings, medium and long-term debt issues and equity
capital. The Corporation's current debt ratings have made sales of finance
receivables the most economical source of funding. The Corporation's insurance
operation generates its funds through internal operations and has no external
borrowings.
In January 1998, Moody's, Standard and Poors and Duff and Phelps raised the
Corporation's senior debt ratings from Ba2, BB and BB+ to Ba1, BB+ and BBB-,
respectively, while the subordinated debt ratings were also raised from B1, B+
and BB to Ba3, BB- and BB+, respectively.
Operations used $24 million of cash in the first half of 1998 as the cash
provided from net income was more than offset by a decrease in accounts payable
to affiliated companies. Investment activities used $295 million of cash during
this period principally as a result of the purchase of finance receivables and
equipment leased to others offset, in part, by the sale of retail notes. To
finance the increase in receivable balances and pay dividends of $27 million to
Transportation, the Corporation increased its financing activities by $347
million.
Receivable sales were a significant source of funding in 1998 and 1997. Through
the asset-backed public market, the Corporation has been able to fund fixed rate
retail note receivables at rates offered to companies with investment grade
ratings. During the first six months of fiscal 1998 and 1997 the Corporation
sold $500 million and $486 million, respectively, of retail notes, through
Navistar Financial Retail Receivables Corporation ("NFRRC"), a wholly-owned
subsidiary, to owner trusts which, in turn, sold notes and certificates to
investors. At April 30, 1998, the remaining shelf registration available to
NFRRC for issuance of asset-backed securities was $973 million.
In June 1998, The Corporation sold $501 million of retail notes, net of unearned
finance income, through NFRRC to an owner trust which, in turn, sold notes to
investors. A gain of $8 million was recognized on the sale.
As of April 30, 1998, Navistar Financial Securities Corporation ("NFSC"), a
wholly-owned subsidiary of the Corporation, had in place a $500 million
revolving wholesale note trust that provides for the continuous sale of eligible
wholesale notes on a daily basis. At April 30, 1998, the remaining shelf
registration available to NFSC for the issuance of investor certificates was
$200 million.
At April 30, 1998, available funding under the amended and restated credit
facility and the asset-backed commercial paper facility was $242 million, of
which $138 million provided funding backup for the outstanding short-term debt.
The remaining $104 million, when combined with unrestricted cash and cash
equivalents, made $143 million available to fund the general business purposes
of the Corporation.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
AND FINANCIAL CONDITION
Year 2000
The Corporation has identified all significant applications that will require
modification to ensure Year 2000 compliance. Internal and external resources are
being used to make the required modifications and test Year 2000 compliance. The
Corporation plans to complete the modifications and testing process of all
significant applications by July 1999, which is prior to any anticipated impact
on its operating systems. The total cost of the Year 2000 project has not been
and is not anticipated to be material to the Corporation's financial position or
results of operations and will be funded through operating cash flows.
The costs of the project and the date on which the Corporation believes it will
complete the Year 2000 modifications are based on management's best estimates,
which were derived utilizing numerous assumptions of future events, including
the continued availability of certain resources, third party modification plans
and other factors. However, there can be no guarantee that these estimates will
be achieved and actual results could differ materially from those anticipated.
Specific factors that might cause such material differences include, but are not
limited to, the availability and cost of personnel trained in this area, the
ability to locate and correct all relevant computer codes and similar
uncertainties.
Business Outlook
Navistar forecasts industry demand for Class 5 through 8 trucks to increase
approximately 12% over 1997 levels. The competitive commercial financing market
will continue to put pressure on the Corporation's retail and wholesale
financing activity and margins.
Management believes that collections on the outstanding receivables portfolio
plus cash available from the Corporation's various funding sources will permit
Navistar Financial to meet the financing requirements of Transportation's
dealers and retail customers through 1998 and beyond.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
No reports on Form 8-K were filed during the six months ended
April 30, 1998.
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.
Navistar Financial Corporation
(Registrant)
Date June 12, 1998 /s/P. E. Cochran
P. E. Cochran
Vice President and Controller
(Principal Accounting Officer)
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENT OF CONSOLIDATED INCOME AND RETAINED EARNINGS AND THE STATEMENT
OF CONSOLIDATED FINANCIAL CONDITION AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-31-1998<F1>
<PERIOD-END> APR-30-1998
<CASH> 39,200
<SECURITIES> 113,300
<RECEIVABLES> 1,459,700
<ALLOWANCES> (12,200)
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 13,400
<DEPRECIATION> (8,500)
<TOTAL-ASSETS> 2,117,500
<CURRENT-LIABILITIES> 0
<BONDS> 1,453,400
0
0
<COMMON> 171,000
<OTHER-SE> 115,200
<TOTAL-LIABILITY-AND-EQUITY> 2,117,500
<SALES> 0
<TOTAL-REVENUES> 64,100
<CGS> 0
<TOTAL-COSTS> 18,100
<OTHER-EXPENSES> 7,600
<LOSS-PROVISION> 800
<INTEREST-EXPENSE> 20,300
<INCOME-PRETAX> 17,300
<INCOME-TAX> (6,600)
<INCOME-CONTINUING> 10,700
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 10,700
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>THE CORPORATION'S STATEMENT OF FINANCIAL CONDITION IS UNCLASSIFIED;
THEREFORE, THE DISTINCTION BETWEEN CURRENT AND LONG-TERM ASSETS AND
LIABILITIES IS NOT AVAILABLE.
</FN>
</TABLE>
