<PAGE>
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 quarterly period ended March 31, 1996
______________
Commission file number 33-11459
________
CORNERSTONE MORTGAGE INVESTMENT GROUP II, INC.
_______________________________________________________________________
(Exact name of registrant as specified in its charter)
DELAWARE 43-1432378
_______________________________________________________________________
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
201 Progress Parkway
Maryland Heights, Missouri 63043
_______________________________________________________________________
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (314) 515-2000
__________________
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, April 29,
1995:
COMMON STOCK, $1.00 Par Value - 500 Shares
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CORNERSTONE MORTGAGE INVESTMENT GROUP II, INC.
INDEX
Page
Number
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheet .........................................3
Notes to Balance Sheet ................................4
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations ...................5
Part II.OTHER INFORMATION......................................6
SIGNATURES.....................................................7
<PAGE>
CORNERSTONE MORTGAGE INVESTMENT GROUP II, INC.
BALANCE SHEET
(Unaudited)
March 31, December 31,
1996 1995
ASSETS
Cash $ 500 $ 500
=========== ===========
STOCKHOLDER'S EQUITY
COMMON STOCK - $1.00 par value,
150,000 shares authorized,
500 issued and outstanding $ 500 $ 500
=========== ===========
The accompanying notes are an integral part of these financial
statements.
<PAGE>
CORNERSTONE MORTGAGE INVESTMENT GROUP II, INC.
NOTES TO BALANCE SHEET
(Unaudited)
BASIS OF PRESENTATION
The financial information included herein is unaudited. However,
in the opinion of management, such information includes all
adjustments of a normal recurring nature which are necessary for its
fair presentation.
Cornerstone Mortgage Investment Group II, Inc. ("Cornerstone II")
is a Delaware corporation and a wholly owned subsidiary of Edward D.
Jones & Co., a Missouri limited partnership. Cornerstone II was
incorporated on December 22, 1986, for the limited purpose of
structuring and selling mortgage-backed securities (the
"Certificates"), which are backed by Government National Mortgage
Association (GNMA), Federal Home loan Mortgage Corporation (FHLMC) and
Federal National Mortgage Association (FNMA) Securities (collectively
the "Deposited Securities").
All costs related to the organization of Cornerstone II were
absorbed by Edward D. Jones & Co. In addition, Edward D. Jones & Co.
paid all offering expenses and assumed all future revenues and
expenses in connection with prior security transactions. Due to the
absence of revenue or expense generating transactions, no income
statement is presented. The balance of stockholder's equity consists
solely of common stock issued on December 30, 1986; therefore, no
statement of stockholder's equity is presented. All funds were
obtained from capital transactions. Therefore, no statement of cash
flows is presented.
No securities were issued by Cornerstone II during the three months
ended March 31, 1996, or 1995.
<PAGE>
CORNERSTONE MORTGAGE INVESTMENT GROUP II, INC.
MANAGEMENT'S FINANCIAL DISCUSSION
No securities were issued during the three months ended March 31,
1996 or 1995.
The outstanding principal balance and remaining collateral value
relating to series issued by Cornerstone Mortgage Investment Group II,
Inc. are $116,416,370 and $116,984,125 as of March 31, 1996.
<PAGE>
CORNERSTONE MORTGAGE INVESTMENT GROUP II, INC.
Item 1:Legal Proceedings:
There are no material pending legal proceedings, other than
routine litigation incidental to the business, to which the
Registrant is party.
Item 2.Changes in Securities:
No change.
Item 3.Default upon Senior Securities:
No default.
Item 4.Submission of Matters to a Vote of Security Holders:
Nothing to report.
Item 5.Other Information:
Nothing to report.
Item 6:Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit No. Description of Exhibit
_________ ______________________
4.1 Deposit Agreement dated as of February 20,
1987, between the Company, as Depositor and
Boatmen's Trust Company of St. Louis, as
Custodian (incorporated by reference to Exhibit
2 to the Current Report on Form 8-K filed on
March 6, 1987).
4.2 Trust Agreement dated as of February 20, 1987,
between the Company, as Depositor and Boatmen's
Trust Company of St. Louis, as Trustee
(incorporated by reference to Exhibit 3 to the
Current Report on Form 8-K filed on March 6,
1987).
4.3 Trust Agreement dated as of February 20, 1987,
between the Company, as Depositor and Boatmen's
Trust Company of St. Louis, as Trustee
(incorporated by reference to Exhibit 4 to the
Current Report on Form 8-K filed on March 6,
1987).
(b) Reports on Form 8-K
No reports were filed on Form 8-K for the quarter ended March 31, 1996.
<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.
CORNERSTONE MORTGAGE INVESTMENT GROUP II, INC.
(Registrant)
/s/John C. Heisler Chairman of the Board,
______________________ Chief Financial Officer,
John C. Heisler Chief Accounting Officer
and Director May 10, 1996
/s/Philip R. Schwab President, Chief Executive
_______________________Officer and Director May 10, 1996
Philip R. Schwab
<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.
CORNERSTONE MORTGAGE INVESTMENT GROUP II, INC.
(Registrant)
Chairman of the Board,
_______________________Chief Financial Officer,
John C. Heisler Chief Accounting Officer
and Director May 10, 1996
President, Chief Executive
_______________________Officer and Director May 10, 1996
Philip R. Schwab
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements for Cornerstone Mortgage Investment Group II, Inc.
for the quarter ended March 31, 1996 and is qualified in its entirety
by reference to such financial statements.
</LEGEND>
<CIK> 0000809767
<NAME> CORNERSTONE MORTGAGE INVESTMENT GROUP II, INC.
<MULTIPLIER> 1
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<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
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0
0
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