SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended June 30, 1997
Commission File Numbers 33-99612, 33-11623, 33-15833, 33-16145
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
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(Exact name of registrant as specified in its registration statements)
Delaware 13-3320910
- ---------------------------- ------------------------------------
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation)
11 Madison Avenue, New York, New York 10010
- --------------------------------------- ------------------------------------
(Address of principal executive office) (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:
1,000 shares of common stock
outstanding as of August 8, 1997
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CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
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INDEX
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<TABLE>
<CAPTION>
Page
Number
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PART I FINANCIAL INFORMATION
<S> <C> <C>
Item 1. Financial Statements
Statements of Financial Condition as of June 30, 1997
and December 31, 1996 3
Statements of Operations for the Six Months Ended
June 30, 1997 and 1996 4
Statements of Cash Flows for the Six Months Ended
June 30, 1997 and 1996 5
Notes to 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
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Page 2
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CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
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STATEMENTS OF FINANCIAL CONDITION
---------------------------------
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
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(unaudited)
(in thousands, except par value and share data)
<S> <C> <C>
Assets:
Cash $ 11 $ 11
Investment in trusts 598 605
Mortgage Pass-Through Certificates 3,268 7,952
Resale agreements -- 23,109
Receivables from affiliates -- 76
Accrued Interest 208 542
------- -------
Total Assets $ 4,085 $32,295
======= =======
Liabilities and stockholder's Equity:
Securities sold not yet purchased:
U.S. Government treasury notes -- 22,859
Payables to affiliates 3,201 7,855
Accrued Interest -- 712
------- -------
Total Liabilities 3,201 31,426
------- -------
Stockholder's Equity:
Common stock, (par value $1.00 per share,
1,000 shares authorized and outstanding) 1 1
Retained earnings 883 868
------- -------
Total Stockholder's Equity 884 869
------- -------
Total Liabilities and Stockholder's Equity $ 4,085 $32,295
======= =======
</TABLE>
See Notes to Financial Statements.
Page 3
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CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
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STATEMENTS OF OPERATIONS
------------------------
(unaudited)
<TABLE>
<CAPTION>
Six Months Six Months
Ended Ended
June 30, 1997 June 30, 1996
------------------- -------------------------
(in thousands)
<S> <C> <C>
Revenues:
Net gains on sales of beneficial interests in trusts $ -- $ --
Principal transactions (55) --
Interest income 319 --
----- ----
Total revenues 264 --
Expenses:
Interest expense 149 --
General and administrative expenses 92 --
----- ----
Total expenses 241 --
Income from operations before income
taxes 23 --
Income taxes 8 --
----- ----
Net income $ 15 $ --
===== ====
</TABLE>
See Notes to Financial Statements.
Page 4
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CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
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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 income $ 15 $ --
Adjustments to reconcile net income to net cash
Provided by (Used for) operating activities:
Decrease in investments in and distribution
by trusts 7 9
Decrease in Mortgage Pass-Through Certificates 4,684 --
Decrease in resale agreements 23,109 --
Decrease in receivables from affiliates 76 --
Decrease in accrued interest receivable 334 --
(Decrease) in accrued interest payable (712) --
-------- -------
Net Cash Provided by (Used for)
Operating Activities 27,513 9
-------- -------
Cash Flows From Financing Activities:
(Decrease) in securities sold not yet purchased (22,859) --
Decrease in deferred debt issuance costs -- 945
(Decrease) in payables to affiliates (4,654) (954)
-------- -------
Net Cash (Used for) Provided by Financing
Activities (27,513) (9)
-------- -------
Net increase in cash -- --
-------- -------
Cash at beginning of year 11 11
-------- -------
Cash at end of year $ 11 $ 11
======== =======
</TABLE>
See Notes to Financial Statements
Page 5
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CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
----------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
(unaudited)
(1) Description of Business
-----------------------
Credit Suisse First Boston Mortgage Securities Corp. (the "Company"),
is a wholly owned subsidiary of Credit Suisse 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 2 to the Company's December 31, 1996
Financial Statements contained in the Company's 1996 Form 10-K.
Page 6
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Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
---------------------------------------------------------------
The principal activities of the Company include (i) issuing and
selling collateralized mortgage obligations (the "Bonds"), (ii)
issuing and selling Strips of Participation Certificates ("Splits"),
(iii) issuing and selling Conduit Mortgage Pass-Through Certificates
("Conduits"), (iv) issuing and selling Commercial/Multifamily Mortgage
Pass-Through Certificates ("Multifamily") and (v) issuing and selling
Home Equity Loan Pass-Through Certificates ("Home Equity").
Results of Operations
---------------------
The Company recorded no gains or (losses) on the sale of beneficial
interests in trusts for the six months ended June 30, 1997 and June
30, 1996.
During the six months ended June 30, 1997 and June 30, 1996, the
Company issued, as depositor, aggregate principal amounts of Bonds,
Conduits, Splits, Multifamily and Home Equities of $1,443,532,000 and
$305,580,000 respectively.
Net unrealized gains and losses on mortgage pass-through certificates
are reflected in principal transactions. Realized gains and losses on
the sale of mortgage pass-through certificates are also reflected in
principal transactions. For the six months ended June 30, 1997,
principal transactions of ($55) are included in the Company's
Statement of Operations.
Management fees, professional fees and other administrative expenses
are paid by FBSC on behalf of the Company.
Liquidity and Capital Resources
-------------------------------
The Company utilizes FBSC to borrow funds and facilitate the
settlement of all transactions through intercompany accounts as
required with FBSC. FBSC does not charge the Company interest on such
borrowings.
Page 7
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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
---------------------------------------------------
Not applicable.
Item 5. Other Information
-----------------
None
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibits:
---------
Restated Certificate of Incorporation of the Company (incorporated
by reference to Exhibit 3.1 to Registration Statement No.
33-47579).
By-Laws of the Company (incorporated by reference to Exhibit 3.2 to
Registration Statement No. 33-47579).
Form of Indenture (incorporated by reference to Exhibit 4 to
Registration Statement No. 33-11924).
Form of Standard Terms and Provisions of Pooling and Servicing
Mortgage Loans/Mortgage Certificates (incorporated by reference to
Exhibit 4.1 to Registration Statement No. 33-47579).
Page 8
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Item 6. Exhibits and Reports on Form 8-K (continued)
--------------------------------------------
(b) Reports on Form 8-K:
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<CAPTION>
Items Reported Financial Statements Filed Date of Filing
<S> <C> <C> <C>
Item 2. Acquisition or Disposition of Assets Not Applicable January 23, 1997
Item 2. Acquisition or Disposition of Assets Not Applicable February 20,1997
Item 5. Other Events Not Applicable March 17, 1997
Item 7. Financial Statements and Exhibits Not Applicable March 26, 1997
Item 7. Financial Statements and Exhibits Not Applicable March 27, 1997
Item 5. Other Events Not Applicable May 7, 1997
Items 5 & 7. Other Events and
Financial Statements and Exhibits Not Applicable June 10, 1997
Items 5 & 7. Other Events and
Financial Statements and Exhibits Not Applicable June 12, 1997
Items 5 & 7. Other Events and
Financial Statements and Exhibits Not Applicable June 16, 1997
Items 5 & 7. Other Events and
Financial Statements and Exhibits Not Applicable June 27, 1997
</TABLE>
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.
Credit Suisse First Boston Mortgage
Securities Corp.
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
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INDEX TO EXHIBITS
-----------------
<TABLE>
<CAPTION>
Exhibit
Number Description of Exhibit Page
- ------ ---------------------- ----
<S> <C> <C>
3.1 Restated Certificates of Incorporation of the Company *
3.2 By-Laws of the Company *
4 Form of Indenture **
4.1 Form of Standard Terms and Provisions of Pooling and Servicing
Mortgage Loans/Mortgage Certificates. *
</TABLE>
* Incorporated by reference to the same Exhibits in Registration Statement No.
33-47579 on Form S-11 filed with the Securities and Exchange Commission.
** Incorporated by reference to the same Exhibits in Registration Statement No.
33-11924 on Form S-11 filed with the Securities and Exchange Commission.
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> 11
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 3,268
<CURRENT-ASSETS> 4,085
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 4,085
<CURRENT-LIABILITIES> 3,201
<BONDS> 0
<COMMON> 1
0
0
<OTHER-SE> 883
<TOTAL-LIABILITY-AND-EQUITY> 4,085
<SALES> 0
<TOTAL-REVENUES> 264
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 92
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 149
<INCOME-PRETAX> 23
<INCOME-TAX> 8
<INCOME-CONTINUING> 15
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 15
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
