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 March 31, 1998
OR
|_| Transition Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from ________________ to _________________
---------------------------------------------------------------------------
BOEING CAPITAL CORPORATION
(Exact name of registrant as specified in its charter)
---------------------------------------------------------------------------
Delaware 95-2564584 0-10795
(State or other (I.R.S. Employer (Commission File No.)
jurisdiction of Identification No.)
Incorporation
or Organization)
4060 Lakewood Boulevard, 6th Floor - Long Beach, California 90808-1700
(Address of principal executive offices)
(562) 627-3000
(Registrant's telephone number, including area code)
---------------------------------------------------------------------------
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 |_|
Common shares outstanding at May 12, 1998: 50,000 shares
Registrant meets the conditions set forth in General Instruction H(1)(a) and (b)
to Form 10-Q and is therefore filing this Form with the reduced disclosure
format.
<PAGE>
Part I
Item 1. Financial Statements
Boeing Capital Corporation and Subsidiaries
Consolidated Balance Sheets
<TABLE>
<CAPTION>
March 31, December 31,
(Dollars in millions, except stated value and par value) 1998 1997
- --------------------------------------------------------------------------------------------------------------
(Unaudited)
<S> <C> <C>
ASSETS
Financing receivables:
Investment in finance leases $ 1,501.0 $ 1,509.1
Notes receivable 311.8 269.0
------------------------------------
1,812.8 1,778.1
Allowance for losses on financing receivables (58.6) (55.9)
------------------------------------
1,754.2 1,722.2
Cash and cash equivalents 27.7 39.1
Equipment under operating leases, net 885.3 922.2
Equipment held for sale or re-lease 0.2 0.7
Other assets 62.2 38.6
------------------------------------
$ 2,729.6 $ 2,722.8
====================================
LIABILITIES AND SHAREHOLDER'S EQUITY
Short-term notes payable $ 156.9 $ 149.0
Accounts payable and accrued expenses 21.7 49.1
Accounts with Boeing, McDonnell Douglas and BCSC 46.4 37.2
Other liabilities 102.3 97.2
Deferred income taxes 394.8 388.3
Long-term debt:
Senior 1,582.6 1,579.0
Subordinated 69.9 69.9
------------------------------------
2,374.6 2,369.7
------------------------------------
Commitments and contingencies - Note 3
Shareholder's equity:
Preferred stock - no par value; authorized 100,000 shares:
Series A; $5,000 stated value; authorized, issued and
outstanding 10,000 shares 50.0 50.0
Common stock - $100 par value; authorized 100,000 shares;
issued and outstanding 50,000 shares 5.0 5.0
Capital in excess of par value 89.5 89.5
Income retained for growth 210.5 208.6
------------------------------------
355.0 353.1
------------------------------------
$ 2,729.6 $ 2,722.8
====================================
</TABLE>
See notes to consolidated financial statements.
<PAGE>
Boeing Capital Corporation and Subsidiaries
Consolidated Statements of Income and Income Retained for Growth
(Unaudited)
<TABLE>
<CAPTION>
Three months ended
March 31,
(Dollars in millions) 1998 1997
- -------------------------------------------------------------------------------------------------------------
OPERATING INCOME
<S> <C> <C>
Finance lease income $ 31.9 $ 35.6
Interest income on notes receivable 6.7 7.0
Operating lease income, net of depreciation expense 17.6 13.7
Net gain on disposal or re-lease of assets 4.8 2.8
Other 0.5 1.6
-----------------------------------
61.5 60.7
-----------------------------------
EXPENSES
Interest expense 32.5 33.2
Provision for losses 2.7 3.5
Operating expenses 2.6 3.1
Other 3.0 1.0
-----------------------------------
40.8 40.8
-----------------------------------
Income before provision for income taxes 20.7 19.9
Provision for income taxes 7.6 7.2
-----------------------------------
Net income 13.1 12.7
Income retained for growth at beginning of year 208.6 181.0
Dividends (11.2) (0.8)
-----------------------------------
Income retained for growth at end of period $ 210.5 $ 192.9
===================================
</TABLE>
See notes to consolidated financial statements.
<PAGE>
Boeing Capital Corporation and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
Three months ended
March 31,
(Dollars in millions) 1998 1997
- -------------------------------------------------------------------------------------------------------------
OPERATING ACTIVITIES
<S> <C> <C>
Net income $ 13.1 $ 12.7
Adjustments to reconcile net income to net cash provided by
(used in) operating activities:
Depreciation expense - equipment under operating leases 18.4 14.7
Net gain on disposal or re-lease of assets (4.8) (2.8)
Provision for losses 2.7 3.5
Change in assets and liabilities:
Accounts with Boeing, McDonnell Douglas and BCSC 9.2 (6.2)
Other assets (23.6) 0.5
Accounts payable and accrued expenses (28.3) (31.3)
Other liabilities 5.1 4.9
Deferred income taxes 6.5 10.3
Other, net 0.4 (1.3)
-----------------------------------
(1.3) 5.0
-----------------------------------
INVESTING ACTIVITIES
Net change in short-term notes and leases receivable - (0.2)
Purchase of equipment for operating leases (6.8) (3.7)
Proceeds from disposition of equipment, notes and leases receivable 39.5 7.3
Collection of notes and leases receivable 54.5 73.2
. Acquisition of notes and leases receivable (97.6) (42.8)
-----------------------------------
(10.4) 33.8
-----------------------------------
FINANCING ACTIVITIES
Net change in short-term borrowings 7.9 (18.9)
Debt having maturities more than 90 days:
Proceeds 75.0 60.0
Repayments (72.3) (84.9)
Payment of cash dividends (10.3) -
-----------------------------------
0.3 (43.8)
-----------------------------------
Net decrease in cash and cash equivalents (11.4) (5.0)
Cash and cash equivalents at beginning of year 39.1 16.9
===================================
Cash and cash equivalents at end of period $ 27.7 $ 11.9
===================================
</TABLE>
See notes to consolidated financial statements.
<PAGE>
Boeing Capital Corporation and Subsidiaries
Notes to Consolidated Financial Statements
March 31, 1998
(Unaudited)
Note 1 -- Basis of Presentation
Boeing Capital Corporation (formerly McDonnell Douglas Finance Corporation) (the
"Company") is a wholly-owned subsidiary of Boeing Capital Services Corporation
(formerly McDonnell Douglas Financial Services Corporation) ("BCSC"), a
wholly-owned subsidiary of McDonnell Douglas Corporation ("McDonnell Douglas"),
which in turn is wholly-owned by The Boeing Company ("Boeing"). The accompanying
unaudited consolidated financial statements have been prepared by the Company in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Article 10 of Regulation
S-X. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. In the opinion of management of the Company, the accompanying
consolidated financial statements reflect all adjustments (consisting of normal
recurring accruals) which are necessary to present fairly the consolidated
balance sheet and the related consolidated statements of income and income
retained for growth and cash flows for the interim periods presented. Operating
results for the three-month period ended March 31, 1998, are not necessarily
indicative of the results that may be expected for the year ended December 31,
1998. The statements should be read in conjunction with the notes to the
consolidated financial statements included in the Company's Form 10-K for the
year ended December 31, 1997.
Note 2 -- Credit Agreements and Long-Term Debt
The provisions of various credit and debt agreements require the Company to
maintain a minimum net worth, restrict indebtedness, and limit cash dividends
and other distributions. Under the most restrictive provision, $74.7 million of
the Company's income retained for growth was available for dividends at March
31, 1998.
Note 3 -- Commitments and Contingencies
On November 1, 1996, The Allen Austin Harris Group, Inc. (the "Plaintiff") filed
a complaint in the Superior Court of the State of California, County of Alameda,
against the Company, McDonnell Douglas, McDonnell Douglas Aerospace - Middle
East Limited and the Selah Group, Inc. (the "Defendants"). The Plaintiff, which
had hoped to establish a manufacturing plant abroad with various assistance from
the Defendants, seeks more than $57.0 million in alleged damages (primarily
consisting of lost profits) based on various theories. The Company believes it
has meritorious defenses to all of the allegations, but is unable to determine
at this stage of discovery if the litigation will have any future material
adverse effect on the Company's earnings, cash flow or financial position.
The Company is a party to litigation in the United States District Court,
Southern District of Florida, entitled McDonnell Douglas Finance Corporation
adv. Aviaco International Leasing, Inc., Aviaco Traders International, Inc. and
Craig L. Dobbin with Related Counter-Claims (collectively referred to as
"Aviaco"). The foregoing litigation arose out of an action brought by the
Company in July 1991 seeking remedies on account of defaults by the other
parties to the litigation under loan and related documents involving a $17.9
million loan made by the Company. In January 1994, in response to the Company's
foreclosure of two aircraft and a related aircraft lease agreement which had
been collateral for the loan, Aviaco filed a counter-claim against the Company,
asserting nine claims for alleged damages based on various tort and contractual
theories relating to the Company's foreclosure.
The case proceeded to jury trial on the three of nine claims which survived the
Company's Motion for Summary Judgment. The case was submitted to the jury on
October 16, 1997. On October 17, 1997, the jury returned a verdict in favor of
Aviaco awarding aggregate damages of approximately $12.2 million, including
damages of approximately $10.0 million for the failure to exercise reasonable
care with regard to the related lease agreement.
In December 1997, the Company filed a Motion for Judgment as a Matter of Law,
arguing, inter alia, to set aside the $10.0 million award as not being supported
by the record evidence or by applicable law. On February 13, 1998, the Judge
ruled in favor of the Company and set aside the $10.0 million award.
On March 2, 1998, the Judge entered a Final Judgment against the Company in the
aggregate amount, including prejudgment interest, of approximately $2.8 million
with post judgment interest thereon at the rate of 5.42% per annum. Both Aviaco
and the Company have appealed from the Final Judgment to the United States Court
of Appeals for the Eleventh Circuit. Taking into account amounts reserved for
this litigation, the Company does not expect such litigation to have any future
material adverse effect on its earnings, cash flow or financial position.
A number of legal proceedings and claims are pending or have been asserted
against the Company. A substantial number of such legal proceedings and claims
are covered by third parties, including insurance companies. The Company
believes that the final outcome of such proceedings and claims will not have a
material adverse effect on its earnings, cash flow, or financial position.
Trans World Airlines, Inc. ("TWA") accounted for $192.7 million (7.1% of total
Company portfolio) and $196.6 million (7.3% of total Company portfolio) at March
31, 1998, and December 31, 1997, respectively. TWA continues to operate under a
reorganization plan, confirmed by the United States Bankruptcy Court in 1995,
that restructured its indebtedness and leasehold obligations to its creditors.
In addition, TWA continues to face financial and operational challenges.
McDonnell Douglas provides guaranties to the Company for certain obligations of
TWA under the various lease agreements between the Company and TWA. At March 31,
1998, the maximum aggregate coverage under such guaranties was $36.1 million.
TWA has reported cash balances of $346.1 million as of March 31, 1998, compared
to $136.5 million at March 31, 1997. As of the date hereof, TWA is current on
its obligations to the Company. If, however, TWA were to default on its
obligations to the Company, this could have a material adverse effect on the
Company's earnings, cash flow or financial position.
P.T. Garuda Indonesia ("Garuda"), accounted for $169.8 million (6.3% of total
Company portfolio) and $171.8 million (6.4% of total Company portfolio) at March
31, 1998, and December 31, 1997, respectively. Negotiations are in progress
relating to Garuda's desire to restructure, or possibly terminate early, the
Company's two MD-11 leases. Although the terms of any such arrangement have not
been agreed upon, taking into account a partial guarantee of Garuda's lease
obligations from McDonnell Douglas and certain security deposits and other
payments under the leases held by the Company, any such restructuring or early
termination is not expected to have a material adverse effect on the Company's
earnings, cash flow or financial position.
The $100.0 million used aircraft purchase bridge facility made available by the
Company to AirTran Airlines ("AirTran"), formerly ValuJet Airlines, Inc., in
1995, was reduced in maximum scope to $50.0 million by mutual agreement during
the third quarter of 1996. This facility expires upon delivery to AirTran of the
first scheduled new Boeing 717-200 (formerly MD-95) aircraft, presently expected
to occur in 1999. Borrowings under this agreement must be repaid within 180 days
and the interest rate is based on the London Interbank Offering Rate ("LIBOR").
There were no amounts outstanding under this agreement at March 31, 1998 or
December 31, 1997.
At March 31, 1998, the Company had commitments to provide leasing and other
financing totaling $104.6 million.
In conjunction with prior asset dispositions and certain guaranties, at March
31, 1998, the Company was subject to a maximum recourse of $60.1 million. Based
on trends to date, the Company's losses related to such exposure are not
expected by the Company to be significant.
The Company leases aircraft under capital leases which have been subleased to
others. At March 31, 1998, the Company had guaranteed the repayment of $5.9
million in capital lease obligations associated with a 50% partner.
Item 2. Management's Analysis of Results of Operations
|------------------------------------------------------------------------------|
FORWARD-LOOKING INFORMATION IS SUBJECT TO RISK AND UNCERTAINTY -- From time
to time, the Company may make certain statements that contain projections or
"forward-looking" information (as defined in the Private Securities Litigation
Reform Act of 1995) that involve risk and uncertainty. Certain statements in
this Form 10-Q, particularly those in Note 3 of the Notes to Consolidated
Financial Statements and Items 1 and 5 of Part II, may contain forward-looking
information. The subject matter of such statements may include, but not be
limited to, the effects on the Company of the Boeing-McDonnell Douglas merger,
as well as future earnings, costs, expenditures, losses, residual values and
various business environment trends. In addition to those contained herein,
forward-looking statements and projections may be made by management of the
Company orally or in writing including, but not limited to, various sections of
the Company's filings with the Securities and Exchange Commission under the
Securities Act of 1933 and the Securities Exchange Act of 1934.
Actual results and trends in the future may differ materially from projections
depending on a variety of factors including, but not limited to, the effects on
the Company of the Boeing-McDonnell Douglas merger and the Company's
relationship with Boeing, as well as strategic decisions relating to the Company
to be made by Boeing, the capital equipment requirements of United States and
foreign businesses, capital availability and cost, changes in law and tax
benefits, the tax position of Boeing (including the applicability of the
alternative minimum tax), competition from other financial institutions, the
Company's successful execution of internal operating plans, defaults by
customers, regulatory uncertainties and legal proceedings.
|------------------------------------------------------------------------------|
Finance lease income decreased $3.7 million (10.4%) from the first three months
of 1997, primarily attributable to the sale of an MD-11 aircraft in September of
1997 and the sale of three MD-82 aircraft in December of 1997.
Operating lease income increased $3.9 million (28.5%) from the first three
months of 1997, primarily attributable to the operating lease financing of four
used Boeing aircraft during the last four months of 1997.
Gain on disposal or re-lease of assets increased $2.0 million (71.4%) from the
first three months of 1997, primarily attributable to sales within the
commercial aircraft portfolio.
Provision for losses decreased $0.8 million (22.9%) from the first three months
of 1997, primarily attributable to the Company's determination that additional
provisions for losses were not necessary or appropriate during the current
period, as the Company's core business segments did not experience net
write-offs during the current period or for the year ended December 31, 1997.
Other expenses increased $2.0 million (200%) from the first three months of
1997, primarily attributable to maintenance expenses of approximately $2.0
million on an airplane that was repossessed in March of 1997.
Part II
Item 1. Legal Proceedings
On November 1, 1996, The Allen Austin Harris Group, Inc. (the "Plaintiff") filed
a complaint in the Superior Court of the State of California, County of Alameda,
against the Company, McDonnell Douglas, McDonnell Douglas Aerospace - Middle
East Limited and the Selah Group, Inc. (the "Defendants"). The Plaintiff, which
had hoped to establish a manufacturing plant abroad with various assistance from
the Defendants, seeks more than $57.0 million in alleged damages (primarily
consisting of lost profits) based on various theories. The Company believes it
has meritorious defenses to all of the allegations, but is unable to determine
at this stage of discovery if the litigation will have any future material
adverse effect on the Company's earnings, cash flow or financial position.
The Company is a party to litigation in the United States District Court,
Southern District of Florida, entitled McDonnell Douglas Finance Corporation
adv. Aviaco International Leasing, Inc., Aviaco Traders International, Inc. and
Craig L. Dobbin with Related Counter-Claims (collectively referred to as
"Aviaco"). The foregoing litigation arose out of an action brought by the
Company in July 1991 seeking remedies on account of defaults by the other
parties to the litigation under loan and related documents involving a $17.9
million loan made by the Company. In January 1994, in response to the Company's
foreclosure of two aircraft and a related aircraft lease agreement which had
been collateral for the loan, Aviaco filed a counter-claim against the Company,
asserting nine claims for alleged damages based on various tort and contractual
theories relating to the Company's foreclosure.
The case proceeded to jury trial on the three of nine claims which survived the
Company's Motion for Summary Judgment. The case was submitted to the jury on
October 16, 1997. On October 17, 1997, the jury returned a verdict in favor of
Aviaco awarding aggregate damages of approximately $12.2 million, including
damages of approximately $10.0 million for the failure to exercise reasonable
care with regard to the related lease agreement.
In December 1997, the Company filed a Motion for Judgment as a Matter of Law,
arguing, inter alia, to set aside the $10.0 million award as not being supported
by the record evidence or by applicable law. On February 13, 1998, the Judge
ruled in favor of the Company and set aside the $10.0 million award.
On March 2, 1998, the Judge entered a Final Judgment against the Company in the
aggregate amount, including prejudgment interest, of approximately $2.8 million
with post judgment interest thereon at the rate of 5.42% per annum. Both Aviaco
and the Company have appealed from the Final Judgment to the United States Court
of Appeals for the Eleventh Circuit. Taking into account amounts reserved for
this litigation, the Company does not expect such litigation to have any future
material adverse effect on its earnings, cash flow or financial position.
A number of legal proceedings and claims are pending or have been asserted
against the Company. A substantial number of such legal proceedings and claims
are covered by third parties, including insurance companies. The Company
believes that the final outcome of such proceedings and claims will not have a
material adverse effect on its earnings, cash flow, or financial position.
Item 2. Changes in Securities and Use of Proceeds
Omitted pursuant to instruction H(2).
Item 3. Defaults Upon Senior Securities
Omitted pursuant to instruction H(2).
Item 4. Submission of Matters to a Vote of Security Holders
Omitted pursuant to instruction H(2).
Item 5. Other Information
Summarized below is information on the effects of the Boeing-McDonnell Douglas
merger, portfolio balances, new business volume, analysis of allowance for
losses on financing receivables and credit loss experience, and receivable
write-offs, net of recoveries by segment.
The Effects of the Boeing-McDonnell Douglas Merger
On August 1, 1997, the Boeing-McDonnell Douglas merger was consummated pursuant
to an Agreement and Plan of Merger dated as of December 14, 1996, among Boeing,
West Acquisition Corp., a wholly-owned subsidiary of Boeing ("Sub"), and
McDonnell Douglas (the "Merger Agreement"). Under the terms of the Merger
Agreement, Sub was merged into McDonnell Douglas, with McDonnell Douglas
surviving as a wholly-owned subsidiary of Boeing.
The many possible ramifications of strategic decisions to be made by Boeing with
respect to the Company are currently unknown and, therefore, cannot be
quantified at this time. Boeing is actively considering the possibility of
divesting all or part of the Company's assets or all or part of the Company's
stock, presently held indirectly by Boeing.
Portfolio Balances
Portfolio balances for the Company's financial reporting segments are summarized
as follows:
<TABLE>
<CAPTION>
March 31, December 31,
(Dollars in millions) 1998 1997
- ------------------------------------------------------------------------------------------------------------------
Aircraft Financing
Boeing/McDonnell Douglas aircraft financing
<S> <C> <C>
Finance leases $ 953.4 $ 964.9
Operating leases 485.8 495.2
Notes receivable 59.2 61.9
---------------------------------------
1,498.4 1,522.0
---------------------------------------
Other commercial aircraft financing
Finance leases 145.1 133.3
Operating leases 50.9 51.9
Notes receivable 4.1 4.3
---------------------------------------
200.1 189.5
---------------------------------------
Commercial Equipment Leasing
Finance leases 402.5 410.9
Operating leases 348.6 375.0
Notes receivable 242.4 190.7
---------------------------------------
993.5 976.6
---------------------------------------
Other 6.1 12.2
---------------------------------------
$ 2,698.1 $ 2,700.3
=======================================
</TABLE>
New Business Volume
New business volume is summarized as follows:
<TABLE>
<CAPTION>
Three months ended
March 31,
(Dollars in millions) 1998 1997
--------------------------------------
<S> <C> <C>
Boeing/McDonnell Douglas aircraft financing $ - $ 1.6
Other commercial aircraft financing 13.5 -
Commercial equipment leasing 76.8 31.3
--------------------------------------
$ 90.3 $ 32.9
======================================
<PAGE>
</TABLE>
Analysis of Allowance for Losses on Financing Receivables and Credit Loss
Experience
<TABLE>
<CAPTION>
March 31, December 31,
(Dollars in millions) 1998 1997
---------------------------------------
<S> <C> <C>
Allowance for losses on financing receivables at beginning
of year $ 55.9 $ 48.6
Provision for losses 2.7 11.5
Write-offs, net of recoveries - (2.5)
Other - (1.7)
---------------------------------------
Allowance for losses on financing receivables at end of
period $ 58.6 $ 55.9
=======================================
Allowance as percent of total portfolio 2.2% 2.1%
Net write-offs as percent of average portfolio - % 0.1%
More than 90 days delinquent:
Amount of delinquent installments $ 0.7 $ 1.8
Total receivables due from delinquent obligors 34.0 15.5
Total receivables due from delinquent obligors
as a percentage of total portfolio 1.3% 0.6%
</TABLE>
Receivable Write-offs, Net of Recoveries by Segment
The Company's two core business segments had no net write-offs of receivables
for the three months ended March 31, 1998. Commercial equipment leasing had $0.2
million in net recoveries, while commercial aircraft financing had no net
write-offs of receivables for the three months ended March 31, 1997.
Item 6. Exhibits and Reports on Form 8-K
A. Exhibits
Exhibit 12 Computation of ratio of income to fixed charges.
Exhibit 27 Financial Data Schedule.
B. Reports on Form 8-K
None.
<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, its principal financial officer and by its principal accounting
officer, thereunto duly authorized.
Boeing Capital Corporation
May 12, 1998 /s/ STEVEN W. VOGEDING
__________________________________
Steven W. Vogeding
Vice President and Chief Financial
Officer (Principal Financial Officer) and
Registrant's Authorized Officer
/s/ MAURA R. MIZUGUCHI
__________________________________
Maura R. Mizuguchi
Controller (Principal Accounting Officer)
EXHIBIT 12
Boeing Capital Corporation and Subsidiaries
Computation of Ratio of Income to Fixed Charges
<TABLE>
<CAPTION>
Three months ended
March 31,
(Dollars in millions) 1998 1997
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Income:
Income before provision for income taxes $ 20.7 $ 19.9
Fixed charges 33.7 34.0
-------------------------------------
Income before provision for income taxes and fixed charges $ 54.4 $ 53.9
=====================================
Fixed charges:
Interest expense $ 32.5 $ 33.2
Preferred stock dividends 1.2 0.8
-------------------------------------
$ 33.7 $ 34.0
=====================================
Ratio of income before provision for income taxes and fixed
charges to fixed charges 1.61 1.59
=====================================
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 27,700
<SECURITIES> 0
<RECEIVABLES> 311,800
<ALLOWANCES> (58,600)
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 2,729,600
<CURRENT-LIABILITIES> 0
<BONDS> 1,652,500
<COMMON> 5,000
0
50,000
<OTHER-SE> 210,500
<TOTAL-LIABILITY-AND-EQUITY> 2,729,600
<SALES> 0
<TOTAL-REVENUES> 61,500
<CGS> 0
<TOTAL-COSTS> 40,800
<OTHER-EXPENSES> 3,000
<LOSS-PROVISION> 2,700
<INTEREST-EXPENSE> 32,500
<INCOME-PRETAX> 20,700
<INCOME-TAX> 7,600
<INCOME-CONTINUING> 13,100
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 13,100
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
