<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH
31, 1996
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE AT OF 1934 FOR THE TRANSITION PERIOD FROM
_________________ TO_____________________
Commission file number 2-63708
METROPOLITAN MORTGAGE & SECURITIES CO., INC.
(Exact name of registrant as specified in its charter)
WASHINGTON 91-0609840
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
West 929 Sprague Ave., Spokane, WA 99204
(Address of principal executive offices) (Zip Code)
(509)838-3111
(Registrant's telephone number, including area code)
__________________________________________________________
(Former name, former address and former fiscal
year, if changed since last report)
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 / /
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING
THE PRECEDING FIVE YEARS: (Not Applicable)
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 / / N/A
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
130 SHARES - Common "A" at April 31, 1996
0 SHARES - Common "B" at April 31, 1996
<PAGE>
METROPOLITAN MORTGAGE & SECURITIES CO., INC.
Part I - Financial Information: Index
Item 1. Financial Statements
Consolidated Condensed Balance Sheets --
March 31, 1996 (Unaudited) and
September 30, 1995
Consolidated Condensed Statements of Income
Three and Six Months Ended March 31, 1996
and 1995 (Unaudited)
Consolidated Condensed Statements of Cash Flows
Six Months Ended March 31, 1996 and 1995
(Unaudited)
Notes to Consolidated Condensed Financial Statements
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
<PAGE>
Part I - Financial Information
METROPOLITAN MORTGAGE & SECURITIES CO., INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, September 30,
1996 1995
(Unaudited)
<S> <C> <C>
ASSETS
Cash and Cash Equivalents $ 20,096,326 $32,798,627
Investments:
Trading Securities, at market
Available-for-Sale Securities,
at market 60,014,894 31,829,980
Held-to-Maturity Securities,
at amortized cost (market value
$112,912,340 and $182,063,885) 117,606,248 188,073,542
Accrued Interest on Investments 1,834,889 2,372,891
-------------- ------------
Total Cash and Investments 199,552,357 255,075,040
-------------- ------------
Real Estate Contracts and Mortgage
Notes and Other Receivables 723,505,416 629,085,029
Real Estate for Sale and
Development - Including
Foreclosed Real Estate 88,777,961 91,105,003
-------------- ------------
Total Receivables and
Real Estate Assets 812,283,377 720,190,032
Less Allowance for Losses (8,116,009) (8,116,065)
-------------- ------------
Net Receivables and
Real Estate Assets 804,167,368 712,073,967
-------------- ------------
Deferred Acquisition Costs 74,437,924 74,521,803
Land, Building and Equipment - net
of accumulated depreciation 8,276,017 8,148,850
Other Assets, net of allowance 30,399,467 28,648,340
-------------- --------------
TOTAL ASSETS $1,116,833,133 $1,078,468,000
============== ==============
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
<PAGE>
METROPOLITAN MORTGAGE & SECURITIES CO., INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, September 30,
1996 1995
(Unaudited)
<S> <C> <C>
LIABILITIES
Life Insurance and Annuity Reserves $818,468,977 $781,716,153
Debenture Bonds 193,415,683 201,311,873
Other Debt Payable 33,907,458 25,552,451
Securities Sold, Not Yet Purchased
Accounts Payable and Accrued
Expenses 16,813,263 15,558,818
Deferred Income Taxes Payable 11,866,570 12,254,475
Minority Interest in Consolidated
Subsidiaries 1,472,061 1,503,788
-------------- --------------
TOTAL LIABILITIES 1,075,944,012 1,037,897,558
-------------- --------------
STOCKHOLDERS' EQUITY
Preferred Stock, Series A, B, C, D,
E Cumulative with Variable Rate,
$10 Par Value, Authorized 8,325,000
Issued 2,164,197 Shares and
2,162,711 Shares (Liquidation
Preference $48,740,983 and
$47,825,310, respectively) 21,641,974 21,627,106
Class A Common Stock - Voting,
$2,250 Par Value, Authorized
222 Shares, Issued 130 Shares,
respectively 293,417 293,417
Additional Paid-In Capital 15,911,045 14,917,782
Retained Earnings 4,174,896 4,561,554
Net Unrealized Gains (Losses) on
Investments (1,132,211) (829,417)
-------------- --------------
TOTAL STOCKHOLDERS' EQUITY 40,889,121 40,570,442
-------------- --------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $1,116,833,133 $1,078,468,000
============== =============
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
<PAGE>
<TABLE>
<CAPTION>
METROPOLITAN MORTGAGE & SECURITIES CO., INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(UNAUDITED)
Three Months Ended Six Months Ended
March 31, March 31,
1996 1995 1996 1995
<S> <C> <C> <C> <C>
REVENUES:
Insurance Premiums Earned $ 750,000 $ 750,000 $ 1,500,000 $ 1,500,000
Interest and Earned Discounts 22,755,006 21,492,296 44,674,881 43,226,148
Real Estate Sales 12,683,339 9,623,525 23,291,364 18,962,314
Fees, Commissions, Service
and Other Income 761,133 556,869 1,452,690 1,532,499
Realized Investment Gains (Losses) 21,290 (154,882) 24,090 (320,480)
Realized Gains on Sales of
Receivables 1,051,230 468,013 1,135,720 468,013
---------- ---------- ---------- ----------
TOTAL REVENUES 38,021,998 32,735,821 72,078,745 65,368,494
---------- ---------- ---------- ----------
EXPENSES:
Insurance Policy and Annuity
Benefits 11,748,235 11,343,906 23,809,875 22,222,312
Interest Expense 4,301,929 4,263,856 8,080,764 8,835,621
Cost of Real Estate Sold 12,063,139 8,903,622 22,529,781 18,349,085
Provision for Losses on Real
Estate Assets 1,336,950 1,362,737 2,271,493 2,063,133
Salaries and Employee
Benefits 2,553,940 2,483,889 4,834,808 4,823,195
Commissions to Agents 2,930,412 3,506,917 5,361,611 6,202,463
Other Operating and
Underwriting Expenses 1,530,022 1,515,771 3,158,585 2,924,683
Less Increase in Deferred
Acquisition Costs (192,868) (1,402,207) (202,000) (1,592,140)
---------- ---------- ---------- ----------
TOTAL EXPENSES 36,271,759 31,978,491 69,844,917 63,828,352
---------- ---------- ---------- ----------
Income Before Income Taxes and
Minority Interest 1,750,239 757,330 2,233,828 1,540,142
Provision For Income Taxes (589,460) (260,080) (760,393) (525,548)
---------- ---------- ---------- ----------
Income Before Minority
Interest 1,160,779 497,250 1,473,435 1,014,594
Income of Consolidated
Subsidiaries Allocated to
Minority Stockholders (26,887) (12,962) (36,198) (6,921)
---------- ---------- ---------- ----------
NET INCOME $ 1,133,892 $ 484,288 $ 1,437,237 $ 1,007,673
========== ========== ========== ==========
The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>
METROPOLITAN MORTGAGE & SECURITIES CO., INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Six Months Ended
March 31,
1996 1995
<S> <C> <C>
Net Cash Provided By
Operating Activities $ 22,956,405 $ 26,298,999
----------- -----------
Cash Flows From Investing Activities:
Principal Payments on Real Estate
Contracts and Mortgage Notes
and Other Receivables 58,058,181 48,344,932
Proceeds From Real Estate Sales 3,072,548 1,426,247
Proceeds From Investment Maturities 13,003,474 1,815,630
Proceeds from Sale of Available
for Sale Securities 31,684,176 65,022,519
Purchase of Available for Sale
Securities (2,139) (32,348,934)
Purchase of Held to Maturity Securities (3,311,988) (534,786)
Proceeds From Sale Real Estate Contracts
and Mortgage Notes and Other
Receivables 18,311,296 16,162,286
Acquisition of Real Estate Contracts and
Mortgage Notes and Other Receivables (150,597,581) (99,913,862)
Additions to Real Estate Held (16,135,196) (19,520,971)
Capital Expenditures (619,562) (503,109)
----------- ------------
Net Cash Used In Investing Activities (46,536,791) (20,050,048)
------------ ------------
Cash Flows From Financing Activities:
Net Change Short Term Borrowings from
Brokers and Banks 7,913,375 (48,306,875)
Receipts From Life and Annuity Products 59,493,607 68,316,400
Withdrawals on Life and Annuity Products (45,305,669) (52,582,614)
Repayment to Banks and Others (1,912,362) (367,714)
Issuance of Debenture Bonds 7,650,338 33,192,131
Issuance of Preferred Stock 1,105,664 3,249,251
Repayment of Debenture Bonds (16,145,440) (26,521,107)
Cash Dividends (1,823,895) (2,578,226)
Redemption of Capital Stock (97,533) (64,080)
----------- -----------
Net Cash Provided By (Used In)
Financing Activities 10,878,085 (25,662,834)
----------- -----------
Net Increase (Decrease) in Cash and
Cash Equivalents (12,702,301) (19,413,883)
Cash and Cash Equivalents at Beginning
of Period 32,798,627 29,275,716
----------- -----------
Cash and Cash Equivalents at End
of Period $ 20,096,326 $ 9,861,833
=========== ===========
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
METROPOLITAN MORTGAGE & SECURITIES CO., INC.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENT
1. In the opinion of the Company, the accompanying unaudited
consolidated condensed financial statements contain all
adjustments necessary to present fairly the financial position
as of March 31, 1996, and the results of operations for the
three and six months ended March 31, 1996 and 1995 and changes
in cash flows for the six months ended March 31, 1996 and 1995.
The results of operations for the six month period ended March
31, 1996 and 1995 are not necessarily indicative of the results
to be expected for the full year.
2. The principal amount of receivables as to which payments were in
arrears more than three months was $22,550,000 at March 31, 1996
and $17,500,000 at September 30, 1995.
3. Metropolitan Mortgage & Securities Co., Inc. had no outstanding
legal proceedings other than normal proceedings associated with
receivable foreclosures, and/or the general business activities
of the Company.
4. Certain amounts in the prior year's consolidated condensed
financial statements have been reclassified to conform with the
current year's presentation. These reclassifications had no
effect on net income or retained earnings as previously
reported.
5. On January 31, 1995 the Company concluded an agreement with
Summit Securities, Inc. (Summit), whereby it sold Metropolitan
Investment Securities, Inc. (MIS) to Summit, at a sale price of
$288,950, which approximated the current book value of MIS at
date of sale. On May 31, 1995 the Company concluded an agreement
with Summit, whereby it sold Old Standard Life Insurance Company
(OSL) to Summit effective May 31, 1995, at a sale price of
$2,722,000, which approximated the current book value of OSL at
date of sale, with future contingency payments based on the
earnings of OSL. The sales price plus estimated future
contingency payments approximates the actuarial appraised
valuation of OSL.
6. In December 1995, the Company reassessed the appropriateness of
the classifications of its securities investments. Based on
this reassessment, the Company transferred $72,572,322 of
securities from the Held-to-Maturity classification to the
Available-for-Sale classification. This transfer was based on
guidance included in the special report issued by the Financial
Accounting Standards Board, "A Guide to Implementation of
Statement 115 on Accounting for Certain Investments in Debt and
Equity Securities".
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Completed Transactions:
On January 31, 1995, Metropolitan Mortgage & Securities Co.,
Inc. (Metro or the Company) and Summit Securities, Inc. (Summit)
consummated a sale/purchase transaction whereby 100% of the common
stock of Metropolitan Investment Securities, Inc. (MIS) was sold to
Summit. The cash sale/purchase price was $288,950, the approximate
net book value of MIS at closing. MIS is a limited-purpose broker
dealer and the exclusive broker/dealer for the securities sold by
Metro and Summit. It is anticipated that this sale will not
materially affect the future business operations of MIS.
Additionally, by agreement, effective January 31, 1995, Metro
discontinued its property development division, which consisted of a
group of employees experienced in real estate development. On the
same date, Summit commenced the operation of a property development
subsidiary employing those same individuals who had previously been
employed by Metro. Summit Property Development Corporation, a 100%
owned subsidiary of Summit, has negotiated an agreement with Metro to
provide future property development services.
On May 31, 1995, Metro and Summit consummated a sale/purchase
transaction whereby 100% of the common stock of Old Standard Life
Insurance Company (OSL) was sold to Summit. The cash sale/purchase
price was $2,722,000, the approximate net book value of OSL at
closing, with future contingency payments based on the earnings of
OSL. The sale/purchase price plus estimated future contingency
payments approximates the actuarial appraised valuation of OSL. OSL
is engaged in the business of acquiring receivables using funds
derived from the sale of annuities and funds derived from receivable
cash flows. The sale of OSL decreased total assets by approximately
$46.2 million while total liabilities also decreased by approximately
$46.2 million. Significant assets removed from the consolidated
financial statement included cash and cash equivalents of $1.4
million, investments of $9.4 million, receivables of $32.1 million,
real estate of $.5 million, deferred acquisition costs of $2.6
million and other assets of $.2 million. Significant liabilities
removed included insurance annuity reserves of $44.5 million and
accounts payable and other liabilities of $1.7 million.
Financial Condition and Liquidity:
As of March 31, 1996, the Company had cash or cash equivalents
of $20.1 million and liquid investments (trading or available-for-
sale securities) of $62.0 million compared to $6.6 million in cash
and cash equivalents and $77.8 million in liquid investments at
December 31, 1995 and $32.8 million in cash and cash equivalents and
$31.8 million in liquid investments at September 30, 1995. Management
believes that cash, cash equivalents and liquidity provided by other
investments are adequate to meet planned asset additions, debt
retirements or other business operational requirements during the
next twelve months. At March 31, 1996, total cash and investments,
including held-to-maturity securities, were $199.6 million as
compared to $202.6 million at December 31, 1995 and $255.1 million at
September 30, 1995. During the six month period ended March 31, 1996,
the decrease in total cash and investments of approximately $55.5
million along with cash generated from operations and cash provided
by financing sources was primarily used in funding the $92.1 million
increase in net receivables and real estate assets. During the period
ended December 31, 1995, the Company reassessed its securities
classifications and transferred approximately $72.6 million from the
held-to-maturity classification to the available-for-sale
classification. This transfer was based on guidance provided by the
Financial Accounting Standards Board through their special report for
implementation of SFAS No. 115 on accounting for debt securities.
The receivable portfolio totaled $723.5 million at March 31,
1996 compared to $687.6 million at December 31, 1995 and $629.1
million at September 30, 1995. During the six months ended March 31,
1996, the increase primarily resulted from the acquisition of
receivables totaling $150.6 million plus an additional $20.2 million
in loans to facilitate the sale of real estate being partially offset
by principal collections on receivables of $58.1 million, a reduction
for the cost basis of receivables sold of $17.2 million and
reductions due to foreclosed receivables of approximately $6.9
million. Other adjustments related to underlying debt assumptions,
accrued interest and discount amortization resulted in increases of
approximately $5.8 million.
Real estate held for sale and development decreased to $88.8
million at March 31, 1996 from $91.0 million at December 31, 1995 and
$91.1 million at September 30, 1995. For the six months ended March
31, 1996, real estate additions of $22.9 million, including $6.9
million of foreclosed receivables, were more than offset by costs of
real estate sold of $22.5 million, depreciation of $1.5 million and
chargeoffs to the allowance for losses of $1.2 million.
Life insurance and annuity policy reserves increased $36.8
million during the six months ended March 31, 1996 to approximately
$818.5 million from $781.7 million at September 30, 1995. This
increase resulted from credited earnings of $22.6 million along with
$14.2 million of new cash flow as receipts from sales of new life and
annuity products of $59.5 million exceeded withdrawals of $45.3
million from existing policies. Net debenture bonds outstanding
decreased by $7.9 million to $193.4 million at March 31, 1996 from
$201.3 million at September 30, 1995. Net cash outflow from
maturities less issuance of new debentures was approximately $8.5
million which was offset by the $.6 million increase in credited
interest held. Additionally, the Company had cash flow, net of
redemptions, of approximately $1.0 million from the sale of preferred
stock and reinvestment of preferred stock dividends during the six
months ended March 31, 1996. During the six month period ended March
31, 1996, the Company increased the portion of its other debt payable
represented by short term borrowings by $7.9 million to an
approximate outstanding amount of $32.0 million in short term
borrowings at March 31, 1996.
Total assets increased by $38.3 million to $1,116.8 million at
March 31, 1996 from $1,078.5 million at September 30, 1995. During
the six month period, the Company primarily used cash flow from life
insurance and annuity products along with existing cash and
investments to increase its receivable portfolio and pay maturing
debentures. At March 31, 1996 the Company had net unrealized losses
on securities available-for-sale in the amount of $1.1 million
compared to unrealized losses of $.8 million at September 30, 1995.
Net unrealized losses on securities available-for-sale is presented
as a separate component of stockholders' equity.
Results of Operations:
The Company recorded net income before preferred dividends for
the six months ended March 31, 1996 of $1,437,000 compared to
$1,008,000 in the prior year's period. Comparing the current year's
six month period with the prior year's similar period, increases in
the net interest spread, increased gains from the sale of real
estate, sale of investment securities and the sale of receivables,
were only partially offset by increases in the provision for losses
on receivables and other real estate assets and a general increase in
expenses.
For the six month period ended March 31, 1996, the Company
reported a positive spread on its interest sensitive assets and
liabilities of $14.3 million as compared to $13.7 million in the
prior year's period. While there has been some contraction in
portfolio investment earnings rates in the current year's period, the
Company has also experienced reduced renewal rates on some of its
life and annuity policies. Currently the Company continues to control
life and annuity policy surrenders by maintaining current market
credited rates. Normally the Company's investment earnings rates are
not as sensitive to market conditions as is its life and annuity
policy rates and thus a sustained rise in interest rates could have a
negative impact on its net interest spread as its liabilities reprice
faster than its assets. Any effect on the net interest spread by
controlling surrenders is normally offset by improvement in the
amortization of insurance and annuity related acquisition costs. The
degree of amortization on insurance and annuity related acquisition
costs is a direct result of the projected rate of these customer
surrenders and the future spread earnings. In the current year's
period ended March 31, 1996, the amortization of deferred policy
acquisition costs was approximately $321,000 less than in the prior
year's similar period primarily due to a reduction in surrenders and
the sale of OSL.
During the six months ended March 31, 1996, the Company realized
net gains from the sale of investments of $24,000 compared to net
losses of $320,000 in the prior year's period. In the prior year
management had made the decision to take losses on certain
investments in order to take advantage of reinvesting in higher
yielding investment opportunities. Additionally, in the current
year's period the Company realized gains of $1.1 million from the
sale of approximately $17.2 million of receivable investments, while
in the prior year sales of approximately $15.7 million of receivable
investments produced realized gains of $468,000.
The Company realized net gains of $762,000 on sales of $23.3
million of real estate in the current year's period compared to net
gains of $613,000 on sales of $19.0 million in the prior year. It has
been the policy of management to actively sell its real estate in
order to return the investment to an earning asset. In addition to
returning these assets to earning status, the Company has been able
to reduce other operating expenses associated with its real estate,
such as insurance, taxes, maintenance and amenities.
In the six months ended March 31, 1996, the Company made
provisions for losses on real estate assets of approximately $2.3
million as compared to $2.1 million in the prior year's period. Even
with the increased receivable portfolio in the current year, the
provisions in each period has remained relatively stable based on
stable receivable delinquency rates and a stable to improving real
estate market.
During the six months ended March 31, 1996, the Company
capitalized approximately $1.7 million less in deferred acquisition
costs associated with receipts from sales of life insurance and
annuity products. This reduction is primarily the result of the sale
of OSL in May 1995. In the current year's period, without the benefit
of OSL, receipts from the sales of life and annuity products was
approximately $59.5 million as compared to $68.3 million in the prior
year, which included OSL for the entire period. After amortization,
the net increase of deferred acquisition costs in current year's
period was approximately $200,000 as compared to $1.6 million in the
prior year's similar period.
New Accounting Rules:
In May 1993, Statement of Financial Accounting Standards No. 114
(SFAS No. 114) "Accounting by Creditors for Impairment of a Loan" was
issued. SFAS No. 114 requires that certain impaired loans be measured
based on the present value of expected future cash flows discounted
at the loans' effective interest rate of the fair value of the
collateral. The Company was required to adopt this new standard as of
October 1, 1995. The adoption of SFAS No. 114 had no material effect
on the Company's consolidated financial statements.
The Company adopted the provisions of SFAS No. 115 "Accounting
for Certain Investments in Debt and Equity Securities", on September
30, 1993. Additionally, under guidance issued by the Financial
Accounting Standards Board for the implementation of SFAS No. 115,
the Company transferred approximately $72.6 million from the Held-to-
maturity classification to Available-for-Sale classification during
the three month period ended December 31, 1995.
In March 1995, SFAS No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed of", was
issued. SFAS No. 121 requires certain long-lived assets, such as the
Company's real estate assets, be reviewed for impairment in value
whenever events or circumstances indicate that the carrying value of
an asset may not be recoverable. In performing the review, if
expected future undiscounted cash flows from the use of the asset or
the fair value, less selling costs, from the disposition of the asset
is less than its carrying value, an impairment loss is to be
recognized. The Company is required to adopt this new standard by
October 1, 1996. The Company does not anticipate that the adoption of
SFAS No. 121 will have a material effect on the Company's
consolidated financial statements.
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
There are no material legal proceedings or actions pending
or threatened against Metropolitan Mortgage & Securities Co., Inc. or
to which its property is subject.
Item 2. Changes in Securities
N/A
Item 3. Defaults Upon Senior Securities
N/A
Item 4. Submission of Matters to a Vote of Security Holders
A. On February 26, 1996, the annual meeting of stockholders was
convened.
B. The meeting included the election of the following directors:
C. Paul Sandifur, Jr.
Bruce Blohowiak
Reuel Swanson
Irv Marcus
Charles Stolz
John Trimble
Harold Erfurth
Neal Fosseen (Honorary Non-Voting Member)
The vote was unanimous. There are no other directors of the Company
whose term of office continued after the meeting.
C. There were no other matters voted upon at the meeting.
D. N/A
Item 5. Other Information
N/A
Item 6. Exhibits and Reports on Form 8-K
N/
<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.
METROPOLITAN MORTGAGE & SECURITIES CO., INC.
(Registrant)
/s/ C. PAUL SANDIFUR, JR.
Date May 14, 1996
--------------- ---------------------------------------------
C. Paul Sandifur, Jr.
Chairman, President, Chief Executive Officer
/s/ BRUCE J. BLOHOWIAK
Date May 14, 1996
--------------- ---------------------------------------------
Bruce J. Blohowiak
Executive Vice President, Chief Operating
Officer and Director
/s/STEVEN CROOKS
Date May 14, 1996
--------------- ---------------------------------------------
Steven Crooks
Vice President
(Principal Accounting Officer)
/s/ REUEL SWANSON
Date May 14, 1996
---------------- --------------------------------------------
Reuel Swanson
Secretary and Director
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> MAR-31-1996
<CASH> 20,096
<SECURITIES> 179,456
<RECEIVABLES> 723,505
<ALLOWANCES> 8,116
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 17,083
<DEPRECIATION> 8,807
<TOTAL-ASSETS> 1,116,833
<CURRENT-LIABILITIES> 0
<BONDS> 227,323
<COMMON> 293
0
21,642
<OTHER-SE> 18,954
<TOTAL-LIABILITY-AND-EQUITY> 1,116,833
<SALES> 0
<TOTAL-REVENUES> 72,079
<CGS> 0
<TOTAL-COSTS> 59,493
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 2,271
<INTEREST-EXPENSE> 8,081
<INCOME-PRETAX> 2,234
<INCOME-TAX> 760
<INCOME-CONTINUING> 1,474
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<CHANGES> 0
<NET-INCOME> 1,437
<EPS-PRIMARY> (2,974.00)
<EPS-DILUTED> (2,974.00)
</TABLE>
