<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
20549
FORM 10-Q
Quarterly Report Pursuant to Section
13 or 15(d) of
the Securities Exchange Act
of 1934
For the quarter ended March 31, 1999 Commission
file number 0-11301
NORWEST MORTGAGE INSURED 1, INC.
(Exact name of registrant as
specified in its charter)
Delaware 41-
1462645
(State or other jurisdiction of (I.R.S.
Employer Identification No.)
incorporation or organization)
1 Home Campus, Des Moines, Iowa
50328
(Address of principal executive offices)
(Zip code)
Registrant's telephone number, including area code
(515) 221-6000
THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN
GENERAL INSTRUCTION H(1)(a) AND (b) OF FORM 10-Q AND
IS THEREFORE FILING THIS FORM WITH THE REDUCED
DISCLOSURE FORMAT.
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 .
On April 23, 1999, 100 shares of the registrant's
common stock were outstanding. All common stock of
registrant is held by an affiliate.
<PAGE> 2
PART I -- FINANCIAL INFORMATION
Item 1. Financial Statements.
The following statements of the Company are included
herein:
1. Balance Sheets - March 31, 1999, and December
31, 1998.
2. Statements of Operations - For the quarters
ended March 31, 1999 and 1998.
3. Statements of Operations - For the three months
ended March 31, 1999 and 1998.
4. Statements of Stockholder's Equity - For the
three months ended March 31, 1999 and 1998, and the
nine months ended December 31, 1998.
The financial information for the interim periods is
unaudited. In the opinion of management, all
adjustments necessary for a fair presentation of the
results of operations have been included. The
results of operations for an interim period are not
necessarily indicative of the results that may be
expected for a full year or any other interim
period.
<PAGE> 3
NORWEST MORTGAGE
INSURED 1, INC.
(a wholly-owned subsidiary
of Norwest Mortgage, Inc.)
BALANCE SHEETS
UNAUDITED
March 31, 1999
and December 31,1998
March
31, December 31,
Assets 1999
1998
Note receivable from parent $10,000
$10,000
Total assets $10,000
$10,000
Stockholder's Equity
Common stock, $1 par value:
100 shares authorized, issued
and outstanding $ 100
$ 100
Additional paid-in capital 9,900
9,900
Total stockholder's equity $10,000
$10,000
<PAGE> 4
NORWEST MORTGAGE
INSURED 1, INC.
(a wholly-owned subsidiary of
Norwest Mortgage, Inc.)
STATEMENTS OF
OPERATIONS
UNAUDITED
For the quarters ended March
31, 1999 and 1998
1999 1998
Income:
Total income $
- -- $ --
Operating expenses:
Total operating expenses --
- --
Net income before income taxes --
- --
Provision for income taxes --
- --
Net income $
- -- $ --
<PAGE> 5
NORWEST MORTGAGE INSURED 1, INC.
(a wholly-owned subsidiary of
Norwest Mortgage, Inc.)
STATEMENTS OF
OPERATIONS
UNAUDITED
For the three months ended
March 31, 1999 and 1998
1999 1998
Income:
Total income
$ -- $ --
Operating expenses:
Total operating expenses
- -- --
Income before income taxes
- -- --
Provision for income taxes
- -- --
Net income $
-- $ --
<PAGE> 6
NORWEST MORTGAGE INSURED 1,
INC.
(a wholly-owned subsidiary of
Norwest Mortgage, Inc.)
STATEMENTS OF STOCKHOLDER'S
EQUITY
UNAUDITED
For the three months ended March 31, 1999 and
1998, and the nine
months ended December 31,
1998
Additional
Common Paid in
Retained
Stock
Capital Earnings Total
Balance, December 31, $100 9,900
- -- 10,000
1997
Net income --
- -- -- --
Balance, March 31, $100 9,900
- -- 10,000
1998
Net income --
- -- -- --
Balance, December 31, $100 9,900
- -- 10,000
1998
Net income --
- -- -- --
Balance, March 31, $100 9,900
- -- 10,000
1999
<PAGE> 7
Item 2. Management's Discussion and Analysis of
Financial Condition and
Results of Operations.
The following narrative by management of the
Company's results of operations is provided in
accordance with General Instruction (H)(2)(a) of
Form 10-Q.
Norwest Mortgage Insured 1, Inc. (the Company), was
incorporated on October 27, 1983, under the laws of
the State of Delaware. as a wholly-owned subsidiary
of Norwest Mortgage, Inc. (the parent company).
The parent is the principal mortgage banking
business of Wells Fargo & Company and derives its'
income primarily from mortgage origination and
servicing operations. The parent is a wholly-owned
subsidiary of Norwest Nova, Inc., which is a wholly
owned subsidiary of Wells Fargo & Company. The
Company was organized to issue and sell one series
of obligations, consisting of four classes,
collateralized by fully modified, pass-through,
mortgage-backed certificates guaranteed as to
principal and interest by the Government National
Mortgage Association (GNMA), and does not intend to
engage in any other business activities except
activities incidental and necessary to the
foregoing.
The Company had no net income for the quarter and
three months ended March 31, 1999 and 1998. The
management contract requires all available income of
the Company be paid to the parent company as
compensation for management services, reimbursement
of expenses, and as additional purchase for the GNMA
Certificates securing the obligations. As a result
of the terms of the management contract, it is
anticipated that the Company will have no net income
for a number of subsequent years.
Year 2000 Readiness Disclosure
The Company is aware of the issues associated
with the programming code in existing computer
systems as the millennium (year 2000) approaches.
The "year 2000 problem" is pervasive and complex;
virtually every computer operation will be affected
in some way by the rollover of the two-digit year
value to 00. The issue is whether computer systems
will properly recognize date-sensitive information
when the year changes to 2000. Systems that do not
properly recognize such information could generate
erroneous data, fail or cause another system to
fail. "Systems" include all hardware, networks,
system and application software, commercial "off-the-
shelf" software, data and voice communication
devices, and embedded technology such as date-
impacted processors in automated systems such as
elevators, telephone systems, security systems,
vault systems, heating and cooling systems and
others.
<PAGE> 8
The Company's year 2000 readiness projects are
divided into four phases:
Phase I: comprehensive assessment and inventory of
Systems intended to determine year 2000
vulnerability and risk;
Phase II: date detection on Systems intended to
determine which Systems must be remediated and which
Systems are compliant and require testing only;
determination of required resources and costs; and
the development of schedules and high-level testing
plans for the repair, replacement and/or retirement
of Systems that are not determined to be year 2000
compliant;
Phase III: repair, replacement and/or retirement of
Systems that are not determined to be year 2000
compliant; conduct testing of individual Systems;
and plan the integration testing for those Systems
that have interfaces with other Systems both
internal and external to the company, such as those
of customers and suppliers; and
Phase IV: integration testing of applicable Systems
to validate that interfaces with other Systems are
year 2000 compliant; and the development of
contingency plans, such as plans to recover
operations and alternatives to mitigate the effects
of counterparties whose own failure to properly
address year 2000 issues may adversely impact their
ability to perform certain functions.
The Company in respect to the year 2000
project: (i) has substantially completed Phases I,
II and III; and(ii) anticipates Phase IV will be
substantially complete by June 30, 1999.
The cost to address the Company's year 2000
projects are included as part of the management
contract with its parent company.
In the event year 2000 problems arise out of a
failure of the efforts described above any resulting
disruptions could adversely affect the business
operations.
<PAGE> 9
PART II -- OTHER
INFORMATION
Item 1. Legal Proceedings.
None.
Item 2. Changes in Securities.
Omitted pursuant to General Instruction
(H)(2)(b) of Form
10-Q.
Item 3. Defaults Upon Senior Securities.
Omitted pursuant to General Instruction
(H)(2)(b) of Form
10-Q.
Item 4. Submission of Matters to a Vote of Security
Holders.
Omitted pursuant to General Instruction
(H)(2)(b) of Form 10-Q.
Item 5. Other Information.
Not applicable.
Item 6. Exhibits and Reports on Form 8-K.
(a) None.
(b) None.
<PAGE> 10
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the Registrant had duly caused
this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Norwest Mortgage Insured 1, Inc.
Dated: April 23, 1999
Robert K. Chapman
Chief Financial Officer
(Principal Accounting and
Financial Officer)
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<PERIOD-END> MAR-31-1999
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 10,000
<ALLOWANCES> 0
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0
0
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