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 Quarter Ended June 30, 1997
Commission File Number 33-42666
COLLATERALIZED MORTGAGE SECURITIES CORPORATION
----------------------------------------------
(Exact name of registrant as specified in its charter)
Maryland 13-3251782
- ---------------------------------------- ------------------------------------
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation)
11 Madison Avenue, New York, New York 10010
- ---------------------------------------- ------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, 212-325-1811
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 (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 ___
---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:
10,000 shares of common stock
outstanding as of August 8, 1997
<PAGE>
COLLATERALZED MORTGAGE SECURITIES CORPORATION AND SUBSIDIARY
------------------------------------------------------------
INDEX
-----
<TABLE>
<CAPTION>
Page
Number
------
<S> <C> <C>
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Statements of Financial Condition as of
June 30, 1997 and December 31, 1996 3
Consolidated Statements of Operations for the Six Months
Ended June 30, 1997 and 1996 4
Consolidated Statements of Cash Flows for the Six Months
Ended June 30, 1997 and 1996 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
PART II OTHER INFORMATION
Item 1. Legal Proceedings 8
Item 2. Changes in Securities 8
Item 3. Defaults Upon Senior Securities 8
Item 4. Submission of Matters to a Vote of Security Holders 8
Item 5. Other Information 8
Item 6. Exhibits and Reports on Form 8-K 8, 9
SIGNATURE 10
INDEX TO EXHIBITS 11
</TABLE>
Page 2
<PAGE>
COLLATERALIZED MORTGAGE SECURITIES CORPORATION AND SUBSIDIARY
-------------------------------------------------------------
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
----------------------------------------------
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
-------- ------------
(unaudited)
(in thousands, except par value and share data)
<S> <C> <C>
Assets:
Cash $ 12 $ 12
Receivable from Credit Suisse First Boston
Management Corporation 1 1
----- -----
Total Assets $ 13 $ 13
===== =====
Liabilities and stockholder's Equity:
- -------------------------------------
Accrued expenses $ -- $ --
----- -----
Total Liabilities -- --
----- -----
Stockholder's Equity:
Common stock and paid in capital, $0.1 par value
(authorized 15,000,000 shares; issued 10,000
shares at June 30, 1997 and December 31,1996) 13 13
----- -----
Total Liabilities and Stockholder's Equity $ 13 $ 13
===== =====
</TABLE>
See Notes to Consolidated Financial Statements.
Page 3
<PAGE>
COLLATERALIZED MORTGAGE SECURITIES CORPORATION AND SUBSIDIARY
-------------------------------------------------------------
CONSOLIDATED STATEMENTS OF OPERATIONS
-------------------------------------
(unaudited)
<TABLE>
<CAPTION>
Six Months Six Months
Ended Ended
June 30, 1997 June 30, 1996
------------- -------------
(in thousands)
<S> <C> <C>
Revenues:
Commitment fee and miscellaneous income $ -- $ --
--------- ---------
-- --
--------- ---------
Expenses:
General and administrative expenses -- --
--------- ---------
-- --
--------- ---------
Loss from operations before income tax
benefit -- --
--------- ---------
Income tax benefit -- --
--------- ---------
Net loss $ -- $ --
========= =========
</TABLE>
See Notes to Consolidated Financial Statements.
Page 4
<PAGE>
COLLATERALIZED MORTGAGE SECURITIES CORPORATION AND SUBSIDIARY
-------------------------------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
-------------------------------------
(unaudited)
<TABLE>
<CAPTION>
Six Months Six Months
Ended Ended
June 30, 1997 June 30, 1996
------------- -------------
(in thousands)
<S> <C> <C>
Cash Flows From Operating Activities:
- -------------------------------------
Net loss $ -- $ --
Adjustments to reconcile net loss
to net cash provided by (used for)
operating activities:
Increase (decrease) in accrued expenses -- --
Decrease in receivable from Credit Suisse First Boston
Management Corporation -- 1,200
------- -------
Net Cash Provided by Operating Activities -- 1,200
------- -------
Cash Flows From Financing Activities:
- -------------------------------------
Net proceeds from (payments for):
Dividends paid -- (1,200)
------- -------
Net Cash Used for Financing Activities -- (1,200)
------- -------
Net increase (decrease) in cash -- --
Cash at beginning of period 12 12
------- -------
Cash at end of period $ 12 $ 12
======= =======
</TABLE>
See Notes to Consolidated Financial Statements.
Page 5
<PAGE>
COLLATERALIZED MORTGAGE SECURITIES CORPORATION AND SUBSIDIARY
-------------------------------------------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------
(unaudited)
1. Description of Business
-----------------------
Collateralized Mortgage Securities Corporation (the "Company") and its
wholly owned subsidiary Asset Backed Securities Corporation ("ABSC") are
wholly owned subsidiaries of Credit Suisse First Boston Management
Corporation ("FBSC"), which is a wholly owned subsidiary of Credit Suisse
First Boston, Inc., a privately owned holding company.
The foregoing financial statements are unaudited; however, in the opinion
of management, all adjustments (comprising only normal recurring accruals)
necessary for a fair presentation of the financial statements have been
included. A summary of the significant accounting policies is set forth in
Note 3 to the Company's December 31, 1996 Financial Statements contained in
the Company's 1996 Form 10-K.
Page 6
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
---------------------------------------------------------------
The principal activities of the Company and ABSC include (i) issuing
and selling collateralized mortgage obligations and asset backed
obligations (the "Bonds") and acquiring, owning, holding and pledging
mortgage-backed securities and receivables, (ii) conveying or
transferring all or any portion of the Companies' rights, title or
interest in the Bonds to various entities including trusts and (iii)
creating, acquiring, owning and selling residual interests in such
entities.
Results of Operations
---------------------
The Company and ABSC recorded no gains or (losses) on the sale of
Bonds or beneficial interests in trusts for the six months ended June
30, 1997 and June 30, 1996.
For the six months ended June 30, 1997 and 1996, the Company had no
substantive transactions.
General and administrative expenses include management fees,
professional fees and other expenses.
Liquidity and Capital Resources
-------------------------------
The Company and ABSC utilize FBSC to facilitate the settlement of all
transactions and maintain all excess cash with FBSC. Such cash is
available from FBSC on demand and does not earn interest. All gains
and losses are recognized by FBSC on each transaction.
Page 7
<PAGE>
PART II - OTHER INFORMATION
---------------------------
Item 1. Legal Proceedings
-----------------
None.
Item 2. Changes in Securities
---------------------
Not applicable
Item 3. Defaults Upon Senior Securities
-------------------------------
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------
None.
Item 5. Other Information
-----------------
None
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibits:
Indentures (incorporated by reference to Exhibit 1 of Company's
Form 8-K dated February 14, 1992 for Series 1992-1) dated as of
January 1, 1987 as amended by Amendment No. 1 dated as of April
30, 1987 and Amendment No. 2 dated as of October 15, 1987, as
amended and restated as of August 1, 1988, between the Company and
State Street Bank and Trust Company, as Trustee.
Articles of Incorporation of the Company as amended as of January
7, 1986 (incorporated by reference to Exhibit 3.1 of the Company's
Form S-3 Registration Statement dated January 31, 1985).
By-laws of the Company as amended and restated as of January 7,
1986 (incorporated by reference to Exhibit 3.2 of the Company's
Form S-3 Registration Statement dated January 31, 1985).
Restated Certificate of Incorporation of Asset Backed Securities
Corporation (incorporated by reference to Exhibit 3.1 of the
Company's Form S-3 Rigistration Statement (No. 0-14811).
Page 8
<PAGE>
Item 6. Exhibits and Reports on Form 8-K (continued)
--------------------------------------------
By-laws of Asset Backed Securities Corporation (incorporated by
reference to Exhibit 3.2 of the Company's Form S-3 Registration
Statement (No. 33-7382)).
Indenture, dated as of October 30, 1986, between Asset Backed
Securities Corporation and State Street Bank and Trust Company,
the Trustee (incorporated by reference to Exhibit 1 of the Current
Report on Form 8-K dated October 30, 1986).
(b) Reports on Form 8-K
-------------------
None.
Page 9
<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.
Collateralized Mortgage
Securities Corporation
By: THOMAS M. ZINGALLI
-------------------------------
Thomas M. Zingalli
Controller and Principal
Accounting Officer
(Duly Authorized Officer and
Principal Accounting Officer)
Dated: August 8, 1997
Page 10
<PAGE>
INDEX TO EXHIBITS
-----------------
<TABLE>
<CAPTION>
Exhibit
Number Description of Exhibit Page
- ------ ---------------------- ----
<S> <C> <C>
1 Indenture dated as of January 1, 1987 as amended by
Amendment No. 1 dated as of April 30, 1987 and Amendment
No. 2 dated as of October 15, 1987, as amended and restated as
of August 1, 1988, between the Company and State Street Bank
and Trust Company, as Trustee. ****
1 Indenture, dated as of October 30, 1986, between Asset Backed
Securities Corporation and State Street Bank and Trust Company,
as Trustee. **
3.1 Articles of incorporation of the Company as amended as of
January 7, 1986. *
3.1 Restated Certificate of Incorporation of Asset Backed Securities
Corporation. ***
3.2 By-Laws of the Company as amended and restated as of
January 7, 1986. *
3.2 By-Laws of Asset Backed Securities Corporation. ****
</TABLE>
* Incorporated by reference to the same Exhibits in Registration
Statement No. 0-13156 on Form 10 filed with the Securities and
Exchange Commission on January 31, 1985.
** Incorporated by reference to the same Exhibit in the Current Report on
Form 8-K filed with the Securities and Exchange Commission on November
14, 1986.
*** Incorporated by reference to the same Exhibit in the Registration
Statement No. 0-014811 of the Company's Form S-3 filed with the
Securities and Exchange Commission on July 21, 1986.
**** Incorporated by reference to the same Exhibit in the Registration
Statement No. 33-7382 of the Company's Form S-3 filed with the
Securities and Exchange Commission on November 12, 1986.
Page 11
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 12
<SECURITIES> 0
<RECEIVABLES> 1
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 13
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 13
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 13
<TOTAL-LIABILITY-AND-EQUITY> 13
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
