- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
================================================================================
Financial Statements
November 30, 1997
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Balance Sheet
================================================================================
<TABLE>
<CAPTION>
November 30, 1997
============================================================================================
<S> <C>
Assets
Investments, at amortized cost, net of allowance for possible loan losses
of $925,000 (Notes 1, 2, 6, 7 and 8 and Schedule of Investments) $83 208 523
Cash 45 931
Interest receivable 1 105 161
Deferred bond issuance costs (Note 2) 941 101
- --------------------------------------------------------------------------------------------
Total assets 85 300 716
============================================================================================
Liabilities
Bonds payable (Notes 3 and 8) 68 252 393
Interest payable (Note 3) 3 546 632
Payable for Redemption of Class A Preferred Certificates (Note 5) 573 881
Dividend payable (Note 5) 260 265
Accrued expenses and other liabilities 151 270
- --------------------------------------------------------------------------------------------
Total liabilities 72 784 441
- --------------------------------------------------------------------------------------------
Net Assets
Class A Preferred Certificates, par value $1 - authorized and outstanding -
2,963,176 certificates (preference as to annual dividends of 13.25%,
mandatory redemption and liquidation at par value) (Note 5) 2 963 176
- --------------------------------------------------------------------------------------------
Class B Certificates, par value $1 - authorized, issued
and outstanding - 1,001,643 certificates (Note 5) 1 001 643
Accumulated deficit (Note 2) (1 185 285)
Paid-in capital (Note 2) 9 736 741
- --------------------------------------------------------------------------------------------
Total net assets applicable to Class B certificateholders 9 553 099
- --------------------------------------------------------------------------------------------
Total net assets $12 516 275
============================================================================================
Net asset value per Class B certificate
(based on 1,001,643 certificates outstanding) $9.54
============================================================================================
The accompanying notes are an integral part of these financial statements.
3
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Statement of Operations
================================================================================
Year Ended November 30, 1997
================================================================================
Investment income:
Interest income (Note 2) $8 977 691
- --------------------------------------------------------------------------------
Expenses:
Interest expense (Notes 2 and 3) 7 407 603
Servicer fees (Note 4) 80 042
Trustee fees (Note 4) 45 123
Other trust and bond administration expenses 248 342
- --------------------------------------------------------------------------------
Total expenses 7 781 110
- --------------------------------------------------------------------------------
Net investment income 1 196 581
Provision for possible loan losses (Notes 2 and 6) 200 000
- --------------------------------------------------------------------------------
Net increase in net assets resulting from operations 996 581
Dividends to Class A Preferred Certificateholders 542 967
- --------------------------------------------------------------------------------
Net increase in net assets applicable to Class B
certificateholders resulting from operations $453 614
================================================================================
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Statement of Cash Flows
<TABLE>
<CAPTION>
==============================================================================================
Year Ended November 30, 1997
==============================================================================================
<S> <C>
Cash flows from operating activities:
Interest received $ 4 776 752
Interest paid (7 627 131)
Operating expenses paid (455 887)
- ----------------------------------------------------------------------------------------------
Net cash used for operating activities (3 306 266)
- ----------------------------------------------------------------------------------------------
Cash flows from investing activities:
Net decrease in funds held under investment agreements 1 444 963
- ----------------------------------------------------------------------------------------------
Principal payments on Loans 10 982 007
- ----------------------------------------------------------------------------------------------
Net cash provided by investing activities 12 426 970
- ----------------------------------------------------------------------------------------------
Cash flows from financing activities:
Principal repayments on Bonds (7 232 369)
Dividends to Class A Preferred Certificates (605 475)
Redemption of Class A Preferred Certificates (1 334 996)
- ----------------------------------------------------------------------------------------------
Net cash used for financing activities (9 172 840)
- ----------------------------------------------------------------------------------------------
Net decrease in cash (52 136)
Cash, beginning of year 98 067
- ----------------------------------------------------------------------------------------------
Cash, end of year $ 45 931
==============================================================================================
Reconciliation of net increase in net assets resulting from operations to net
cash used for operating activities:
Net increase in net assets resulting from operations $ 996 581
Provision for possible loan losses 200 000
Decrease in interest receivable 473 363
Decrease in accrued expenses and other liabilities (82 380)
Decrease in bond interest payable (368 851)
Amortization of deferred Bond issuance costs 149 323
Amortization of purchase discount on Loans (4 674 302)
- ----------------------------------------------------------------------------------------------
Net cash used for operating activities $(3 306 266)
==============================================================================================
The accompanying notes are an integral part of these financial statements.
5
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Statements of Changes in Net Assets
(Note 2 (f))
================================================================================
<TABLE>
<CAPTION>
Years Ended November 30, 1997 1996
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
From operations:
Net investment income $1 196 581 $2 697 289
Provision for possible loan losses (200 000) (200 000)
Dividends to certificateholders (Notes 2 and 5):
Class A Preferred certificateholders ($.1325 per certificate annually):
From net investment income (145 716) (171 187)
As tax return of capital (379 251) (507 770)
- -----------------------------------------------------------------------------------------------------------------------
Net increase in net assets applicable to Class B
certificateholders resulting from operations 453 614 1 818 332
- -----------------------------------------------------------------------------------------------------------------------
Capital certificate transactions (Note 5):
Redemptions of Class A Preferred certificates,
1,304,023 and 1,109,166 certificates in 1997 and 1996, respectively (1 304 023) (1 109 166)
- -----------------------------------------------------------------------------------------------------------------------
Net decrease in net assets resulting from
capital certificate transactions (1 304 023) (1 109 166)
- -----------------------------------------------------------------------------------------------------------------------
Net (decrease) increase in net assets (850 409) 709 166
Net assets:
Beginning of year 13 366 684 12 657 518
- -----------------------------------------------------------------------------------------------------------------------
End of year $12 516 275 $13 366 684
=======================================================================================================================
The accompanying notes are an integral part of these financial statements.
6
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Selected Financial Highlights for Each
Class B Certificate Outstanding
Throughout the Periods Indicated
(Notes 1 and 5)
================================================================================
<TABLE>
<CAPTION>
Years Ended November 30, 1997 1996 1995 1994 1993
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year $9.08 $ 7.27 $ 6.61 $ 4.41 $ 3.84
- ----------------------------------------------------------------------------------------------------------------------
Net investment income 1.20 2.69 1.77 3.04 1.44
Provision for possible loan losses (.20) (.20) (.40) (.12) --
Dividends to Class A Preferred
Certificateholders:
From net investment income (.15) (.17) (.64) (.42) (.87)
As tax return of capital (.39) (.51) (.07) (.30) --
- ----------------------------------------------------------------------------------------------------------------------
Net asset value, end of year $9.54 $ 9.08 $ 7.27 $ 6.61 $ 4.41
======================================================================================================================
Total investment return (a) N/A N/A N/A N/A N/A
Net assets applicable to
Class A Preferred Certificates,
end of year $2 963 176 $4 267 199 $5 376 365 $5 233 897 $5 997 151
Net assets applicable to Class B
Certificates, end of year $9 553 099 $9 099 485 $7 281 153 $6 620 384 $4 418 852
======================================================================================================================
Ratios and Supplemental Data:
Ratio of expenses to average
net assets applicable to
Class B Certificates 83.43 %(b) 103.94 %(b) 133.48 %(b) 180.25 %(b) 274.18 %(b)
Ratio of net investment income
to average net assets applicable
to Class B Certificates 12.83 % 32.93 % 25.57 % 55.24 % 35.10 %
Number of Class B Certificates
outstanding, end of year 1 001 643 1 001 643 1 001 643 1 001 643 1 001 643
(a) The Trust's investments are recorded at amortized cost as discussed in
Note 2. Accordingly, the financial statements do not reflect the market
value of such investments. For this reason, management believes that no
meaningful information can be provided regarding "Total Investment Return"
and has not included information under that heading.
(b) Excluding interest expense, the ratio of expenses to average net assets
applicable to Class B Certificates was 5.61%, 6.47%, 7.96%, 11.64% and
13.68% in 1997, 1996, 1995, 1994 and 1993, respectively.
The accompanying notes are an integral part of these financial statements.
7
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Notes to Financial Statements
================================================================================
1. Organization and College and University Facility Loan Trust One (the
Business Trust) was formed on September 17, 1987 as a business
trust under the laws of the Commonwealth of
Massachusetts by a declaration of trust by State Street
Bank and Trust Company, formerly the Bank of Boston,
(the Owner Trustee), not in its individual capacity but
solely as Owner Trustee. The Trust is registered under
the Investment Company Act of 1940 (as amended) as a
diversified, closed-end, management investment company.
The Trust was formed for the sole purpose of raising
funds through the issuance and sale of bonds (the
Bonds). The Trust commenced operations on September 29,
1987 (the Closing Date) and issued Bonds in five
tranches in the aggregate principal amount of
$126,995,000. The Bonds constitute full recourse
obligations of the Trust. The collateral securing the
Bonds consists primarily of a pool of college and
university facility loans (the Loans) to various
postsecondary educational institutions and funds held
under the indenture (the Indenture) and the investment
agreements. The Loans were originated by or previously
assigned to the United States Department of Education
(ED) under the College Housing Loan Program or the
Academic Facilities Loan Program. The Loans, which have
been assigned to The First National Bank of Chicago (the
Bond Trustee), are secured by various types of
collateral, including mortgages on real estate, general
recourse obligations of the borrowers, pledges of
securities and pledges of revenues. As of the Closing
Date, the Loans had a weighted average stated interest
rate of approximately 3.16% and a weighted average
remaining term to maturity of approximately 19.4 years.
Payments on the Loans are managed by the Bond Trustee in
various fund accounts and are invested under investment
agreements (see Note 2) as specified in the Indenture.
8
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Notes to Financial Statements
================================================================================
1. Organization and All payments on the Loans and earnings under the
Business investment agreements and any required transfers from
(Continued) the Expense, Reserve and Liquidity Funds are deposited
to the credit of the Revenue Fund held by the Bond
Trustee as defined within, and in accordance with, the
Indenture. On each bond payment date, amounts on deposit
to the credit of the Revenue Fund are applied in the
following order of priority: to pay amounts due on the
Bonds, to pay administrative expenses not previously
paid from the Expense Fund, to fund the Expense Fund to
the Expense Fund Requirement, to fund the Reserve Fund
to the Maximum Reserve Requirement, and to fund the
Liquidity Fund to the Liquidity Fund Requirement. Any
funds remaining in the Revenue Fund on such payment date
are paid to the certificateholders in the order of
priority discussed in Note 5.
On the Closing Date, certificates were issued by the
Trust to ED as partial payments for the Loans. In
December 1989, ED sold, through a private placement, all
of its ownership interest in the Trust.
2. Summary of (a) College and University Facility Loans The Loans were
Significant purchased and recorded at a discount below par. Pursuant
Accounting to a "no-action letter" that the Trust received from the
Policies Securities and Exchange Commission, the Loans (included
in investments in the accompanying balance sheet) are
being accounted for under the amortized cost method of
accounting. Under this method, the difference between
the cost of each Loan to the Trust and the scheduled
principal and interest payments is amortized, assuming
no prepayments of principal, and included in the Trust's
income by applying the Loan's effective interest rate to
the amortized cost of that Loan. The remaining balance
of the purchase discount on the Loans as of November 30,
1997 was approximately $39,579,000. As a result of
prepayments of Loans in the year ended November 30,
1997, additional interest income of approximately
$91,000 was recognized.
9
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Notes to Financial Statements
================================================================================
2. Summary of (a) College and University Facility Loans
Significant
Accounting The Trust's policy is to discontinue the accrual of
Policies interest on Loans for which payment of principal or
(Continued) interest is 180 days or more past due or (Continued) for
such other Loans if management believes the collection
of interest and principal is doubtful. When a Loan is
placed on nonaccrual status, all previously accrued but
uncollected interest is reversed against the current
period's interest income. Subsequently, interest income
is recorded when received. Payments are applied to
interest first with the balance, if any, applied to
principal. At November 30, 1997, two loans had been
placed on nonaccrual status, as discussed in Note 6.
(b) Other Investments
Other investments, which are included in Investments on
the accompanying balance sheet, consist of two unsecured
investment agreements issued by the Federal National
Mortgage Association bearing fixed rates of interest of
5% and 8%. These investments are carried at cost. These
investment agreements terminate on the earlier of
December 1, 2014 or the date on which the Bonds are
paid-in-full.
(c) Federal Income Taxes
It is the Trust's policy to comply with the requirements
applicable to a regulated investment company under
Subchapter M of the Internal Revenue Code of 1986, as
amended, and to distribute substantially all of its
investment company taxable income to its
certificateholders each year. Accordingly, no federal or
state income tax provision is required.
For tax purposes, the Loans were transferred to the
Trust at their face values. Accordingly, the accretion
of the purchase discount creates a permanent book-tax
difference.
10
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Notes to Financial Statements
================================================================================
2. Summary of (d) Deferred Bond Issuance Costs
Significant
Accounting Deferred Bond issuance costs are being amortized using
Policies the effective interest-rate method, assuming that all
(Continued) mandatory semiannual payments will be made on the term
bonds as discussed in Note 3.
(e) Accounting for Impairment of a Loan and Allowance
for Possible Loan Losses
The Trust accounts for credit losses in accordance with
Statement of Financial Accounting Standards (SFAS) No.
114, Accounting by Creditors for Impairment of a Loan,
as amended by SFAS No. 118 (hereafter collectively
referred to as SFAS 114). SFAS 114 requires that
impaired loans, as defined, be measured based on the
present value of the expected future cash flows
discounted at the loan's effective interest rate or the
fair value of the collateral if the loan is collateral
dependent.
Management is responsible for establishing an allowance
for possible loan losses based on its best estimate of
losses that might occur. Ultimate losses may vary from
the current estimate. This estimate is reviewed
periodically, and as a provision to the allowance for
possible loan losses becomes necessary, it is reported
in the period in which it becomes known. Allowances are
established for those loans that, in the opinion of
management, are deemed to be impaired and potentially
uncollectible.
The allowance for possible loan losses is based on
management's evaluation of the level of the allowance
required in relation to the estimated loss exposure in
the loan portfolio. Factors considered in evaluating the
adequacy of the allowance include previous loss
experience, current economic conditions and their effect
on borrowers, the performance of individual Loans in
relation to contract terms, adverse situations that may
affect the borrower's ability to pay, and the estimated
fair values of collateral.
11
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Notes to Financial Statements
================================================================================
2. Summary of (e) Accounting for Impairment of a Loan and Allowance
Significant for Possible Loan Losses (Continued)
Accounting
Policies The factors discussed above are inherently difficult to
(Continued) predict. Accordingly, the final outcome of these
estimates and the ultimate realization of amounts on
certain Loans may vary significantly from the amounts
reflected in the accompanying financial statements.
(f) Presentation of Capital Distributions
Capital distributions are accounted for in accordance
with the American Institute of Certified Public
Accountants Statement of Position 93-2, "Determination,
Disclosure and Financial Statement Presentation of
Income, Capital Gain and Return of Capital Distributions
by Investment Companies" (SOP 93-2). SOP 93-2 requires
the Trust to report distributions that are in excess of
tax basis earnings and profits as a tax return of
capital and to present the capital accounts on a basis
that approximates the amounts that are available for
future distributions on a tax basis.
As all tax earnings and profits have been distributed,
accumulated undistributed net investment income of
$591,126 has been reclassified as paid-in capital. This
reclassification results from permanent book and tax
differences such as the receipt of tax-exempt interest
income on certain Loans, the related interest expense on
the Bonds, and the accretion of purchase discount on the
Loans. Amounts deducted for the loan loss reserve and
dividends payable are not currently deductible for tax
purposes and have been reclassified as an accumulated
deficit. These reclassifications had no impact on the
net investment income or net assets of the Trust.
12
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Notes to Financial Statements
================================================================================
2. Summary of (g) Use of Estimates
Significant
Accounting The preparation of financial statements in conformity
Policies with generally accepted accounting principles requires
(Continued) management to make estimates and assumptions that affect
the reported amounts of assets and liabilities at the
date of the financial statements and the reported
amounts of revenues and expenses during the reporting
period. Actual results could differ from those
estimates.
3. Bonds The Bonds outstanding at November 30, 1997 consist of
the following:
Principal
Interest Amount
Type Rate Stated Maturity (000s)
========================================================
Term 10.20% June 1, 2002 $30 675
Term 10.55 December 1, 2014 37 577
--------------------------------------------------------
$68 252
========================================================
The Bonds maturing on June 1, 2002 are being redeemed,
in part, on a pro rata basis by application of mandatory
semiannual payments and commencing December 1, 2002, the
Bonds maturing on December 1, 2014 will also be redeemed
on a pro rata basis. The redemption price is equal to
100% of the principal amount to be redeemed plus
interest accrued to the redemption date.
Interest on the Bonds is payable semiannually. On
December 1, 1997, the Trust made the mandatory
redemption of $3,640,737 on the Bonds maturing on June
1, 2002.
13
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Notes to Financial Statements
================================================================================
3. Bonds The aggregate scheduled maturities of the Bonds,
(Continued) including the scheduled mandatory redemptions at
November 30, 1997, are as follows:
Amount
Fiscal Year (000s)
========================================================
1998 6 911
1999 6 829
2000 6 169
2001 5 570
2002 5 196
Thereafter 37 577
--------------------------------------------------------
Total $68 252
========================================================
The Bonds are not subject to optional redemption by
either the Trust or the bondholders.
In the event the Trust realizes negative cash flows,
various reserve funds have been established and
maintained such that, on or before such bond payment
date, such funds may be used by the Bond Trustee to make
any required payments on the Bonds and to pay operating
expenses of the Trust.
As required by the Indenture, the scheduled future cash
flows for Loans that are in default are excluded from
the calculation of the Reserve Fund requirement. The
impact of excluding Loans in default from the
calculation increases the Reserve Fund requirement. The
cash flows from the December 1, 1997 Bond Payment were
sufficient to satisfy the maximum funding requirement of
$8,141,740.
14
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Notes to Financial Statements
================================================================================
4. Administrative
Agreements (a) Servicer
On November 14, 1997 General Electric Capital
Corporation (GECC) transferred its servicing
responsibilities, as defined in the Trust's Servicing
Agreement dated September 1, 1987, to GMAC Commercial
Mortgage Corporation (GMAC).
As compensation for the services provided under the
servicing agreement, the Servicer receives a collection
fee. This fee is paid on each date of payment for each
Loan and is equal to .055 of 1% of the outstanding
principal balance of such Loan divided by the number of
payments of principal and interest in a calendar year.
The fees associated with services provided during the
year are as follows: for the period December 1, 1996
through November 14, 1997, GECC's fees totaled $63,497
and for the period from November 15, 1997 through
November 30, 1997, GMAC's fees totaled $6,712. GECC was
also reimbursed for other related expenses of $9,833.
(b) Trustees
As compensation for services provided, the Owner and
Bond Trustees are entitled under the Declaration of
Trust and the Indenture to receive the following fees:
o The Owner Trustee, in its capacities as manager
of the Trust and as Owner Trustee, received fees
of $11,950 and $10,755, respectively, for the
year ended November 30, 1997. In addition, the
Owner Trustee was reimbursed $1,640 for
out-of-pocket expenses.
o The Bond Trustee is entitled to an annual fee
equal to .025 of 1% of the aggregate outstanding
principal of the Bonds on the bond payment date
immediately preceding the date of payment of
such fee. The Bond Trustee is also reimbursed
for out-of-pocket expenses in an amount not to
exceed 4% of the applicable annual fee. For the
year ended November 30, 1997, the fees amounted
to $18,241. In addition, the Bond Trustee was
reimbursed $2,537 for out-of-pocket expenses.
15
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Notes to Financial Statements
================================================================================
5. Certificates The certificates comprise two classes, namely 13.25%
Class A Preferred and Class B. The Class A Preferred
certificates have preference over the Class B
certificates with respect to the payment of dividends,
rights of redemption and liquidation payments. Dividends
on the Class A Preferred certificates are payable in
cash on each Distribution Date (defined below) at the
rate of 13.25% per annum from amounts received by the
Owner Trustee pursuant to the Declaration of Trust. To
the extent that such amounts are not sufficient to pay
accrued dividends on any Class A Preferred certificates
on any Distribution Date, such dividends will be paid in
additional certificates of the Class A Preferred
certificates. The Class A Preferred certificates are
required to be redeemed by the Trust, in whole or in
part, on any Distribution Date to the extent of the
amount on deposit to the credit of the Revenue Fund, as
discussed in Note 1, and after all accrued but unpaid
dividends thereon have been paid in full. No
distributions on the Class B certificates may be made
until all Class A Preferred certificates have been
redeemed. Following the redemption in full of the Class
A Preferred certificates, on each Distribution Date, the
holders of the Class B certificates will receive amounts
paid to the Owner Trustee pursuant to the Declaration of
Trust, pro rata, in the same proportion that the par
value of the certificates evidenced by each Class B
certificate bears to the sum of the par value of the
certificates evidenced by all of the Class B
certificates.
Dividends and other payments are distributed to the
certificateholders, while the Bonds are outstanding, on
the second business day in each June and December (the
Distribution Date) and, after the Bonds are paid in
full, on the first business day of each month.
On December 1, 1997, the Trust paid $568,437 to the
holders of Class A Preferred certificates, of which
$234,330 was for payment of dividends and $334,107 was a
redemption of Class A Preferred certificates. As a
result of certain procedural difficulties associated
with the servicing of the Loans, there was an unusual
number of late payments as of November 1, 1997. In order
to mitigate the impact of the late payments on the
December 1, 1997 distribution, the Trustees elected to
extend the collection period from November 15, 1997 to
December 5, 1997 (inclusive) and made a second
distribution on December 23, 1997. On December 23, 1997,
the Trust
16
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Notes to Financial Statements
================================================================================
5. Certificates paid $265,709 to the holders of Class A Preferred
(Continued) certificates, of which $25,935 was for payment of
dividends and $239,774 was a redemption of Class A
Preferred certificates. These payments are reflected as
liabilities in the accompanying balance sheet.
The certificateholders shall each be entitled to one
vote per certificate.
6. Allowance for An analysis of the allowance for possible loan losses
Possible Loan for the year ended November 30, 1997 is summarized as
Losses follows:
Balance, beginning of year $725 000
Provision 200 000
Charge-offs --
--------------------------------------------------------
Balance, end of year $925 000
========================================================
At November 30, 1997, the recorded investment in loans
that are considered to be impaired under SFAS 114 was
approximately $1,138,000 with a related allowance for
possible loan losses of $591,000.
The average recorded investment in impaired loans during
the year ended November 30, 1997 was approximately
$1,181,000. For the year ended November 30, 1997, no
interest income was recognized on impaired loans.
The amortized cost of the loans placed on nonaccrual
status is approximately $1,138,000 at November 30, 1997.
See "Accounting for Impairment of a Loan and Allowance
for Possible Loan Losses" for a discussion of the
Trust's impaired loan accounting policy.
17
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Notes to Financial Statements
================================================================================
7. Loans Scheduled principal and interest payments on the
Loans as of November 30, 1997, excluding payments for
Loans in Default, as defined in the Indenture, are as
follows:
Principal Interest
Payments Payments Total
Fiscal Year (000s) (000s) (000s)
========================================================
1998 $ 10 684 $ 3 158 $ 13 842
1999 9 929 2 801 12 730
2000 8 721 2 490 11 211
2001 8 181 2 208 10 389
2002 7 388 1 947 9 335
Thereafter 56 943 13 691 70 634
--------------------------------------------------------
Total $101 846 $26 295 $128 141
========================================================
Expected payments may differ from contractual payments
because borrowers may prepay or default on their
obligations. Accordingly, actual principal and interest
payments on the Loans may vary significantly from the
scheduled payments.
The following analysis summarizes the stratification of
the loan portfolio by type of collateral and institution
as of November 30, 1997:
Amortized
Number Cost
Type of Collateral of Loans (000s) %
========================================================
Loans secured by a
first mortgage 133 $30 855 47.2%
Loans not secured by
a first mortgage 87 34 459 52.8%
--------------------------------------------------------
Total Loans 220 $65 314 100.0%
========================================================
18
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Notes to Financial Statements
================================================================================
7. Loans
(Continued)
Amortized
Number Cost
Type of Insitution of Loans (000s) %
========================================================
Private 140 $30 825 47.2%
Public 80 34 489 52.8%
--------------------------------------------------------
Total Loans 220 $65 314 100.0%
========================================================
The ability of a borrower to meet future debt service
payments on a Loan will depend on a number of factors
relevant to the financial condition of such borrower,
including, among others, the size and diversity of the
borrower's sources of revenues; enrollment trends;
reputation; management expertise; the availability and
restrictions on the use of endowments and other funds;
the quality and maintenance costs of the borrower's
facilities; and, in the case of some Loans to public
institutions which are obligations of a state, the
financial condition of the relevant state or other
governmental entity and its policies with respect to
education. The ability of a borrower to maintain
enrollment levels will depend on such factors as tuition
costs, geographical location, geographic diversity,
quality of the student body, quality of the faculty and
the diversity of program offerings.
The collateral for Loans that are secured by a mortgage
on real estate generally consists of special purpose
facilities, such as dormitories, dining halls and
gymnasiums, which are integral components of the overall
educational setting. As a result, in the event of
borrower default on a Loan, the Trust's ability to
realize the outstanding balance of the Loan through the
sale of the underlying collateral may be negatively
impacted by the special purpose nature and location of
such collateral.
19
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Notes to Financial Statements
================================================================================
7. Loans A number of borrowers are currently experiencing adverse
(Continued) changes in their financial condition due to declining
enrollment, increasing costs and a decline in
endowments, grants, private gifts, and State and Federal
funding. Many of these potentially troubled borrowers
are developing and implementing strategic plans to
improve their financial position; the plans generally
include taking actions to control costs and increase
revenues through tuition increases, fundraising
campaigns, higher enrollment and a reduction of faculty.
Due to the special purpose nature of the borrowers'
properties, the ability of such troubled borrowers to
repay their loans may ultimately be dependent on the
future success of the institutions' programs.
8. Fair Value SFAS No. 107, "Disclosures about Fair Value of Financial
of Financial Instruments," allows for the use of a wide range of
Instruments valuation techniques; therefore, it may be difficult to
compare the Trust's fair value information to public
market information or to other fair value information.
Accordingly, the fair value information presented below
does not purport to represent, and should not be
construed to represent, the underlying "market" value of
the Trust's net assets or the amounts that would result
from the sale or settlement of the related financial
instruments. Further, as the assumptions inherent in
fair value estimates change, the fair value estimates
will change.
Current market prices are not available for most of the
Trust's financial instruments since an active market
generally does not exist for such instruments. In
accordance with the terms of the Indenture, the Trust is
required to hold all of the Loans to maturity and to use
the cash flows therefrom to retire the Bonds.
Accordingly, the Trust has estimated the fair values of
its financial instruments using a discounted cash flow
methodology. This methodology is similar to the approach
used at the formation of the Trust to determine the
carrying amounts of these
20
<PAGE>
- --------------------------------------------------------------------------------
College and University
Facility Loan Trust One
Notes to Financial Statements
================================================================================
8. Fair Value instruments for financial reporting purposes. In
of Financial applying the methodology, the calculations have been
Instruments adjusted for the change in the relevant market rates of
(Continued) interest, the estimated duration of the instruments and
an internally developed credit risk rating of the
instruments. All calculations are based on the scheduled
principal and interest payments on the Loans because the
prepayment rate on these loans is not subject to
estimate.
The estimated fair value of each category of the Trust's
financial instruments and the related book value
presented in the accompanying balance sheet as of
November 30, 1997 are as follows:
Book Value Fair Value
(000s) (000s)
========================================================
Loans $64 389* $ 86 132
Investment Agreements:
Revenue Fund 16 220 13 889
Liquidity Fund 2 600 1 678
--------------------------------------------------------
$83 209 $101 699
========================================================
Bonds $68 252 $ 83 679
========================================================
* Net of Allowance for Possible Loan Losses of $925,000.
21
<PAGE>
COLLEGE AND UNIVERSITY FACILITY LOAN TRUST ONE
SCHEDULE OF INVESTMENTS
November 30, 1997
(Dollar Amounts in Thousands)
<TABLE>
<CAPTION>
Outstanding Stated Internal Amortized
Principal Interest Maturity Rate of Cost (Notes
Balance Description Rate% Date Return % 1 and 2)
- ----------- ------------------------------------------- ------------ ------------------ ------------- -----------
<S> <C> <C> <C> <C> <C>
COLLEGE AND UNIVERSITY LOANS (77.4%)
---------- A ---------
$1,410 Albion College 3.00 10/01/2015 12.51 $708
102 Albion College 3.00 11/01/1999 12.74 89
145 Albright College 3.50 05/01/2001 11.70 126
403 Alfred University 3.00 11/01/2007 12.41 259
61 Allegheny College 3.00 07/01/1999 12.73 53
82 Allegheny College 3.50 07/01/2001 12.83 66
570 Alma College 3.00 04/01/2010 11.87 353
305 Alverno College 3.375 10/01/2003 12.52 228
177 American Graduate School of
International Management 3.00 11/01/2010 12.59 104
290 Anderson College 3.00 03/01/2010 13.02 171
1,054 Appalachian State University 3.00-3.625 07/01/2004 11.80 773
422 Arizona State University 3.50 10/01/2003 11.72 328
215 Atlantic Union College 3.00 05/01/2023 12.68 90
1,470 Augsburg College 3.00 04/01/2016 12.95 725
838 Azusa Pacific University 3.00 04/01/2017 12.96 401
---------- B ---------
695 Baptist College at Charleston 3.00 03/01/2014 12.96 361
57 Barnard College 3.125 04/01/1999 12.82 52
92 Benedict College 3.00 11/01/2006 12.42 61
24 Bethune-Cookman College 3.00 10/01/2000 12.71 20
343 Birmingham-Southern College 3.00 10/01/2006 12.48 250
500 Birmingham-Southern College 3.00 10/01/2010 12.47 312
148 Black Hills State College 3.00 10/01/2005 11.76 104
110 Black Hills State College 3.00 10/01/2007 11.77 75
927 Boston University 3.00 12/31/2022 11.87 414
210 Bryan College 3.00 02/01/2010 12.68 124
53 Buena Vista College 3.625 02/01/2001 13.45 44
209 Buena Vista College 3.00 11/01/2009 12.41 126
---------- C ---------
2,230 California State University 3.00 11/01/2012 10.57 1,359
637 Carnegie - Mellon University 3.00 11/01/2017 10.45 354
2,075 Case Western Reserve University 3.00 04/01/2016 10.54 1,185
33 Centenary College of Louisiana 2.875 10/01/1999 12.82 29
142 Central Missouri State 3.125 07/01/2000 11.83 120
264 Central Missouri State 3.50 07/01/2001 11.80 215
174 Central Washington University 3.50 10/01/1999 10.99 157
714 Central Washington University 3.75 10/01/2004 11.03 556
The accompanying notes are an integral part of these financial statements. 22
</TABLE>
<PAGE>
COLLEGE AND UNIVERSITY FACILITY LOAN TRUST ONE
SCHEDULE OF INVESTMENTS
November 30, 1997
(Dollar Amounts in Thousands)
(continued)
<TABLE>
<CAPTION>
Outstanding Stated Internal Amortized
Principal Interest Maturity Rate of Cost (Notes
Balance Description Rate% Date Return % 1 and 2)
- ----------- ------------------------------------------- ------------ ------------------ ------------- -----------
<S> <C> <C> <C> <C> <C>
$44 Chaminade College of Honolulu 3.50 10/01/2002 12.55 $34
296 Chaminade College of Honolulu 3.00 10/01/2011 12.47 168
95 Champlain College 3.00 10/01/2010 12.66 56
277 Claflin College 3.00 11/01/2002 12.57 216
135 Clark College 3.00 11/01/1999 12.75 125
1,055 College of Charleston 3.00 07/01/2016 12.02 534
625 College of St. Thomas 3.00 04/01/2017 12.95 302
623 College of the Virgin Islands 3.00 10/01/2004 11.83 454
328 Colorado State University 3.50 04/01/2001 12.17 278
1,200 Colorado State University 3.625 04/01/2005 11.98 896
409 Community College of Rhode Island 3.00 04/01/2018 12.10 202
770 Concordia College 3.00 05/01/2011 12.64 445
96 Contra Costa College 3.00 04/01/2009 12.34 60
57 Cornell University 3.00 11/01/1999 10.84 51
383 Curry College 3.00 04/01/2010 12.74 227
---------- D ---------
35 Dana College 3.50 04/01/2001 13.39 29
345 Daniel Webster College 3.00 04/01/2019 12.99 156
399 Dean Junior College 3.00 04/01/2016 12.96 201
54 Dillard University 3.375 04/01/2002 13.41 45
80 Dillard University 3.00 11/01/2000 12.68 67
5 Dormitory Authority of New York 3.00 07/01/1998 12.77 3
1,245 Drake University 3.00 10/01/2012 12.71 686
140 Drexel University 3.75 05/01/2000 11.72 130
---------- E ---------
446 Eckerd College 3.50 07/01/2003 12.53 333
59 Eckerd College 3.75 03/01/2005 13.04 42
134 Emory University 3.375 07/01/2002 12.59 106
315 Emory University 3.375 03/01/2003 13.25 241
470 Emporia State University 3.00 04/01/2009 12.33 297
---------- F ---------
304 Fairleigh Dickinson University 3.50 11/01/2003 11.66 235
119 Fairleigh Dickinson University 3.00 11/01/2020 12.09 56
32 Findlay College 3.375 07/01/2002 12.56 25
375 Florida Atlantic University 3.00 07/01/2006 11.85 253
75 Florida Institute of Technology 3.00 02/01/2006 13.17 50
175 Foothill College 3.00 10/01/2006 11.76 120
29 Fort Hays State University 3.00 10/01/1998 11.88 27
264 Fort Hays State University 3.375 10/01/2002 11.74 209
40 Fort Lewis College 3.125 10/01/1999 11.84 35
The accompanying notes are an integral part of these financial statements. 23
</TABLE>
<PAGE>
COLLEGE AND UNIVERSITY FACILITY LOAN TRUST ONE
SCHEDULE OF INVESTMENTS
November 30, 1997
(Dollar Amounts in Thousands)
(continued)
<TABLE>
<CAPTION>
Outstanding Stated Internal Amortized
Principal Interest Maturity Rate of Cost (Notes
Balance Description Rate% Date Return % 1 and 2)
- ----------- ------------------------------------------- ------------ ------------------ ------------- -----------
<S> <C> <C> <C> <C> <C>
---------- G ---------
$819 Gordon College 3.50 04/01/2013 12.84 $458
1,285 Grambling State University 3.00-3.75 10/01/2005 11.70 923
---------- H ---------
142 Hampshire College 3.00 11/01/2006 12.43 95
740 Harcum Junior College 3.00 11/01/2015 12.44 373
450 Haverford College 3.625 11/01/2013 12.29 254
43 High Point College 3.375 12/01/2002 11.63 31
170 High Point College 3.00 12/01/2007 11.72 103
---------- I ---------
860 Indiana University 3.50 04/01/2000 11.56 764
213 Inter American University of San Juan 2.75-3.00 12/01/2001 11.63 176
1,125 Iowa State University of Ames 3.00 07/01/2007 10.63 773
---------- J ---------
460 Jackson State University 3.00 01/01/2007 12.50 304
82 Jarvis Christian College 3.50 04/01/2001 13.41 68
583 Jarvis Christian College 3.00 04/01/2019 12.96 266
---------- K ---------
46 Kansas Newman College 3.125 04/01/2000 13.71 41
168 Kansas Newman College 3.00 04/01/2006 13.10 116
325 Kansas State University 3.375 04/01/2002 11.79 267
102 Kansas State University 3.50 04/01/2000 11.52 91
253 Kent State University 2.875 12/01/1999 10.01 231
1,480 Kent State University 3.00 12/01/2008 10.55 1,003
103 Kenyon College 3.00 11/01/1999 10.69 92
89 Kirksville College of Kirksville, Missouri 3.125 12/01/2000 11.63 76
190 Knox College 3.00 05/01/2007 12.72 126
---------- L ---------
8 Lambuth College 3.00 05/01/1998 14.06 8
267 Laredo Junior College 3.00 08/01/2009 11.82 165
142 Lawrence University 3.375 04/01/2002 13.34 113
21 Lincoln College 3.00 12/01/1998 11.63 19
71 Linfield College 3.125 10/01/1999 12.80 62
635 Long Island University 3.00 06/01/2016 12.34 310
731 Long Island University 3.75 10/01/2005 12.42 519
185 Louisiana State University 3.50 07/01/2002 10.50 155
640 Louisiana State University 3.50 04/01/2002 11.10 535
177 Louisiana Tech University 3.50 04/01/2000 12.72 160
130 Loyola University - Mundelein Branch 3.125 10/01/2000 12.70 108
25 Lynchburg College 3.00 11/01/1998 12.83 23
The accompanying notes are an integral part of these financial statements. 24
</TABLE>
<PAGE>
COLLEGE AND UNIVERSITY FACILITY LOAN TRUST ONE
SCHEDULE OF INVESTMENTS
November 30, 1997
(Dollar Amounts in Thousands)
(continued)
<TABLE>
<CAPTION>
Outstanding Stated Internal Amortized
Principal Interest Maturity Rate of Cost (Notes
Balance Description Rate% Date Return % 1 and 2)
- ----------- ------------------------------------------- ------------ ------------------ ------------- -----------
<S> <C> <C> <C> <C> <C>
---------- M ---------
$480 McKendree College 3.00 04/01/2007 13.07 $312
115 Medical College of Wisconsin 3.00 10/01/1999 12.79 100
51 Merrimack College 2.875 04/01/1999 13.83 46
766 Michigan State University 3.00 05/01/2020 10.96 390
1,503 Middlebury College 3.00 04/01/2018 12.87 767
53 Midland Lutheran College 3.50 04/01/2001 13.41 44
38 Midland Lutheran College 2.875 04/01/1999 13.77 34
132 Mississippi State University 2.75 12/01/1997 10.70 125
405 Mississippi State University 3.50 12/01/2001 10.82 345
110 Mississippi Valley State 3.00 07/01/2008 11.89 71
593 Missouri Southern State College 3.00 12/01/2008 10.56 399
336 Missouri Western State College 3.00 10/01/2008 11.77 216
448 Montclair State College 3.00 07/01/2008 11.32 291
305 Monterey Peninsula College 3.00 10/01/2018 11.95 146
119 Montreat-Anderson College 3.00 12/01/2019 12.19 56
257 Moravian College 3.00 11/01/2000 12.67 214
28 Morehouse College 2.875 07/01/1999 10.48 25
110 Morehouse College 3.375 07/01/2001 10.57 92
1,005 Morris College 3.00 11/01/2013 12.42 537
---------- N ---------
419 New England College 3.625 10/01/2013 12.37 238
1,060 New England College 3.00 04/01/2019 12.96 485
125 North Carolina Agriculture
and Technical State University 3.75 07/01/2004 10.02 99
15 North Carolina Central University 3.00 11/01/1998 11.83 14
1,115 North Carolina State University 3.00 09/01/2006 8.02 884
75 North Carolina State University 3.00 09/01/1998 6.63 72
90 Northeastern University 3.00 05/01/1999 13.10 80
---------- O ---------
110 Occidental College 3.50 10/01/2001 12.62 89
2,245 Old Dominion University 3.00 06/01/2013 11.70 1,239
154 Ouachita Baptist University 3.375 12/01/2002 11.63 123
---------- P ---------
70 Pacific University 3.50 10/01/2001 12.66 58
73 Pacific University 3.00 11/01/1999 12.75 63
43 Pan American University 3.50 10/01/2000 11.00 38
399 Pittsburg State University 3.75 04/01/2005 12.30 298
496 Point Loma Nazarene College 3.75 04/01/2005 13.05 360
29 Post College 3.00 10/01/1998 12.90 26
The accompanying notes are an integral part of these financial statements. 25
</TABLE>
<PAGE>
COLLEGE AND UNIVERSITY FACILITY LOAN TRUST ONE
SCHEDULE OF INVESTMENTS
November 30, 1997
(Dollar Amounts in Thousands)
(continued)
<TABLE>
<CAPTION>
Outstanding Stated Internal Amortized
Principal Interest Maturity Rate of Cost (Notes
Balance Description Rate% Date Return % 1 and 2)
- ----------- ------------------------------------------- ------------ ------------------ ------------- -----------
<S> <C> <C> <C> <C> <C>
$106 Providence Hospital 3.375 01/01/2002 11.33 $87
580 Purdue University 3.50 07/01/2001 10.26 490
---------- R ---------
269 Riverside Hospital 3.00 04/01/2007 13.09 177
713 Rivier College 3.625 04/01/2014 12.78 396
---------- S ---------
415 San Diego State University 3.00 11/01/2021 11.93 189
860 San Francisco State University 3.00 11/01/2021 11.93 391
1,184 Sarah Lawrence College 3.00 11/01/2021 12.64 526
348 Scripps College 3.00 10/01/2005 12.51 257
140 Simpson College 3.375 07/01/2001 12.18 113
146 South Dakota State University 3.125 04/01/2000 12.76 132
1,565 South Dakota State University 3.00 04/01/2016 12.31 809
35 South Plains Junior College District 3.125 10/01/1999 11.85 31
1,345 Southeast Missouri State 3.50 04/01/2005 12.32 984
271 Southern Arkansas University 3.75 10/01/2004 11.76 205
125 Southern Methodist University 3.00 10/01/1998 12.87 113
49 Southern Nazarene University 3.125 04/01/2000 13.60 42
69 Spring Arbor College 3.00 11/01/2000 12.67 57
184 Springfield College 3.00 05/01/2011 12.59 107
85 St. Augustine's College 3.00 11/01/2001 12.61 69
217 St. Edward's University 3.625 04/01/2013 12.80 123
315 St. Francis College 3.50 05/01/2001 12.88 264
414 St. Mary's University of San Antonio 3.75 11/01/2002 12.47 327
230 St. Michael's College 3.00 04/01/2008 13.06 148
411 Stanford University 3.125 04/01/2002 9.82 355
190 Stanford University 3.00 05/01/1999 9.61 182
971 Stanford University 3.00 05/01/2024 10.40 479
84 Stetson University 3.50 09/01/2001 12.48 70
38 Stillman College 3.00 02/01/2007 13.24 25
2,877 Suomi College (A) 3.00 08/01/2014 12.70 983
175 Susquehanna University 3.00 11/01/2006 12.44 117
430 Susquehanna University 3.625 11/01/2014 12.32 237
149 Swarthmore College 3.00 11/01/2013 12.30 81
---------- T ---------
675 Taylor University 3.00 10/01/2010 12.45 394
518 Temple University 3.375 11/01/2014 11.99 290
235 Temple University 2.875 05/01/1999 13.18 213
65 Texas Christian University 3.00 04/01/1998 13.97 61
The accompanying notes are an integral part of these financial statements. 26
</TABLE>
<PAGE>
COLLEGE AND UNIVERSITY FACILITY LOAN TRUST ONE
SCHEDULE OF INVESTMENTS
November 30, 1997
(Dollar Amounts in Thousands)
(continued)
<TABLE>
<CAPTION>
Outstanding Stated Internal Amortized
Principal Interest Maturity Rate of Cost (Notes
Balance Description Rate% Date Return % 1 and 2)
- ----------- ------------------------------------------- ------------ ------------------ ------------- -----------
<S> <C> <C> <C> <C> <C>
$329 Texas College 3.00 04/01/2007 13.09 $215
743 Texas Tech University 3.625 03/01/2013 10.80 465
5,295 Texas Tech University 3.375-3.50 03/01/2012 10.83 3,356
132 Tougaloo College 3.00 06/01/2021 12.44 58
766 Tufts University 3.625 10/01/2004 12.47 564
---------- U ---------
1,921 University of Alabama 3.00 05/01/2021 12.27 883
112 University of Alaska 3.125 04/01/2001 12.63 95
226 University of Arkansas at Monticello 3.625 04/01/2004 12.40 172
26 University of Arkansas at Little Rock 2.875 04/01/1999 12.01 24
55 University of Chicago 3.00 06/01/1998 12.59 49
43 University of Chicago 3.50 12/01/2001 11.63 35
639 University of Florida 3.00 01/01/1999 12.70 583
1,213 University of Florida 3.00 01/01/2005 12.51 868
1,120 University of Hawaii at Manoa 3.00 10/01/2006 11.76 765
1,482 University of Missouri at Columbia 3.625 05/01/2004 11.63 1,161
22 University of Missouri at Rolla 2.875 05/01/1998 12.01 21
98 University of Missouri at Rolla 3.50 05/01/2003 11.68 79
259 University of Montevallo 3.00 05/01/2023 12.30 113
148 University of Nebraska 3.00 07/01/2013 10.59 89
382 University of North Carolina 3.50 07/01/2002 10.60 311
1,485 University of North Carolina 3.00 01/01/2018 11.49 765
1,840 University of Notre Dame 3.00 04/01/2018 12.95 861
100 University of Pittsburgh 3.00 11/01/1999 9.95 90
311 University of Portland 3.00 04/01/2013 12.95 166
559 University of Rochester 3.375 10/01/2002 10.77 462
1,210 University of Rochester 3.00 10/01/2006 10.92 854
948 University of South Dakota 3.625 10/01/2013 11.74 553
2,340 University of South Florida 3.00 07/01/2013 11.97 1,275
313 University of Steubenville 3.375 04/01/2012 12.88 178
350 University of Steubenville 3.00 04/01/2017 12.96 168
2,952 University of Vermont 3.00 10/01/2019 12.19 1,398
150 University of Washington 3.50 08/01/2000 11.06 129
170 Upsala College (A) 2.75 10/01/1996 12.65 155
770 Utah State University 3.50 04/01/2002 11.76 635
---------- V ---------
1,149 Vanderbilt University 3.00 08/01/2005 10.69 838
800 Vanderbilt University 3.00 06/30/2009 10.39 535
---------- W ---------
220 West Virginia Institute of Technology 3.00 06/01/1999 11.66 192
The accompanying notes are an integral part of these financial statements. 27
</TABLE>
<PAGE>
COLLEGE AND UNIVERSITY FACILITY LOAN TRUST ONE
SCHEDULE OF INVESTMENTS
November 30, 1997
(Dollar Amounts in Thousands)
(continued)
<TABLE>
<CAPTION>
Outstanding Stated Internal Amortized
Principal Interest Maturity Rate of Cost (Notes
Balance Description Rate% Date Return % 1 and 2)
- ----------- ------------------------------------------- ------------ ------------------ ------------- -----------
<S> <C> <C> <C> <C> <C>
$444 West Virginia Wesleyan College 3.50 05/01/2002 13.43 $343
175 Western Carolina University 3.75 11/01/2001 11.67 146
1,420 Western Maryland College 3.00 11/01/2016 12.44 703
190 Western Washington University 3.00 10/01/2007 11.16 129
77 Whittier College 3.50 04/01/2001 13.53 66
---------- X ---------
580 Xavier University 3.00 10/01/2017 12.54 273
- ----------- ---------
$104,893 Total College and University Loans $65,314
- -----------
Allowance for Possible Loan Losses 925
---------
Net College and University Loans 64,389
---------
INVESTMENT AGREEMENTS (22.6%)
$2,600 FNMA #787 Liquidity Fund 8.00 12/01/2014 8.00 $2,600
16,220 FNMA #786 Revenue Fund 5.00 12/01/2014 5.00 16,220
- ----------- ---------
$18,820 Total Investment Agreements $18,820
- ----------- ---------
$123,713 Total Investments (100.0%) $83,209
=========== =========
(A) These institutions have been placed on nonaccrual status as more
fully described in Note 6.
The accompanying notes are an integral part of these financial statements. 28
</TABLE>
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To State Street Bank and Trust Company (Owner Trustee):
We have audited the accompanying balance sheet of College and University
Facility Loan Trust One (a Massachusetts business trust), including the schedule
of investments, as of November 30, 1997, and the related statements of
operations and cash flows for the year then ended, and the statements of changes
in net assets for each of the two years in the period then ended, and the
selected financial highlights for each of the periods presented. These financial
statements and the selected financial highlights are the responsibility of the
Owner Trustee. Our responsibility is to express an opinion on these financial
statements and the selected financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and the selected
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of the Loans and
Investments as of November 30, 1997 by correspondence with GMAC Commercial
Mortgage Corporation and Federal National Mortgage Association, respectively. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and the selected financial highlights
referred to above present fairly, in all material respects, the financial
position of College and University Facility Loan Trust One as of November 30,
1997, and the results of its operations and its cash flows for the year then
ended, and the changes in its net assets for each of the two years in the period
then ended, and the selected financial highlights for the periods presented, in
conformity with generally accepted accounting principles.
Boston, Massachusetts
January 13, 1998
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information extracted from the College
and University Facility Loan Trust One November 30, 1997 financial statements
and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> NOV-30-1997
<PERIOD-END> NOV-30-1997
<INVESTMENTS-AT-COST> 83209
<INVESTMENTS-AT-VALUE> 0
<RECEIVABLES> 1105
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 987
<TOTAL-ASSETS> 85301
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 68252
<OTHER-ITEMS-LIABILITIES> 4532
<TOTAL-LIABILITIES> 72784
<SENIOR-EQUITY> 2963
<PAID-IN-CAPITAL-COMMON> 9737
<SHARES-COMMON-STOCK> 1001643
<SHARES-COMMON-PRIOR> 1001643
<ACCUMULATED-NII-CURRENT> (1185)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 12516
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 8978
<OTHER-INCOME> 0
<EXPENSES-NET> 7781
<NET-INVESTMENT-INCOME> 1197
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 997
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 543
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (850)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 1048
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 7408
<GROSS-EXPENSE> 7781
<AVERAGE-NET-ASSETS> 12926
<PER-SHARE-NAV-BEGIN> 9.08
<PER-SHARE-NII> 1.20
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> .15
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> .39
<PER-SHARE-NAV-END> 9.54
<EXPENSE-RATIO> .60
<AVG-DEBT-OUTSTANDING> 71742
<AVG-DEBT-PER-SHARE> 71.62
</TABLE>
