FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 1995
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period From __________ To __________
Commission File Number 1-7080
RELIANCE FINANCIAL SERVICES CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 51-0113548
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 909-1100
The Registrant meets the requirements and conditions set forth in General
Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this Form
with reduced disclosure as permitted thereunder.
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 _____
As of November 1, 1995, 1,000 shares of common stock of Reliance Financial
Services Corporation were outstanding.
RELIANCE FINANCIAL SERVICES CORPORATION AND SUBSIDIARIES
I N D E X
Page
No.
----
PART I. FINANCIAL INFORMATION:
Item 1. Financial Statements
Consolidated Statement of Income for the Quarters and Nine-Month
Periods Ended September 30, 1995 and 1994 (Unaudited) . . . . . . . . 2
Consolidated Balance Sheet at September 30, 1995 (Unaudited) and
December 31, 1994 . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Consolidated Statement of Changes in Shareholder's Equity for the
Nine-Month Period Ended September 30, 1995 (Unaudited). . . . . . . . 4
Consolidated Condensed Statement of Cash Flows for the Nine-Month
Periods Ended September 30, 1995 and 1994 (Unaudited) . . . . . . . . 5
Notes to Consolidated Financial Statements (Unaudited) . . . . 6
Item 2. Management's Discussion and Analysis of the
Consolidated Statement of Income . . . . . . . . . . . . . . 8
PART II. OTHER INFORMATION, AS APPLICABLE . . . . . . . . . . . . . . . 13
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
RELIANCE FINANCIAL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
<TABLE>
<CAPTION>
Quarter Ended Nine Months Ended
September 30 September 30
1995 1994 1995 1994
(In thousands)
<S>
Revenues: <C> <C> <C> <C>
Premiums earned........................................ $ 618,831 $ 623,547 $ 1,823,454 $ 2,044,020
Net investment income.................................. 68,727 65,362 204,467 192,615
Gain on sales of investments........................... 10,187 3,403 26,142 8,712
Interest income from parent company.................... 5,166 3,551 15,445 9,515
Other.................................................. 36,512 36,847 114,986 105,431
---------- ---------- ------------ ------------
739,423 732,710 2,184,494 2,360,293
---------- ---------- ------------ ------------
Claims and expenses:
Policy claims and settlement expenses.................. 319,068 308,941 947,632 1,038,250
Policy acquisition costs............................... 102,172 97,621 301,545 298,837
Interest............................................... 5,280 5,335 15,724 15,265
Other insurance expenses............................... 206,623 229,327 609,466 771,377
Other.................................................. 35,388 34,821 110,251 102,618
---------- ---------- ------------ ------------
668,531 676,045 1,984,618 2,226,347
---------- ---------- ------------ ------------
Income before income taxes, minority interests
and equity in investee company..................... 70,892 56,665 199,876 133,946
Provision for income taxes............................. (22,500) (15,590) (64,000) (37,280)
Minority interests..................................... - (657) (849) (2,021)
Equity in investee company............................. 2,072 2,776 6,225 7,566
---------- ---------- ------------ ------------
Income from continuing operations...................... 50,464 43,194 141,252 102,211
Loss on disposal of discontinued operations of
investee company................................... (4,497) - (4,497) -
---------- ---------- ------------ ------------
Income before extraordinary item....................... 45,967 43,194 136,755 102,211
Extraordinary item - early extinguishment of debt...... - - (3,363) -
---------- ---------- ------------ ------------
Net income............................................. $ 45,967 $ 43,194 $ 133,392 $ 102,211
========== ========== ============ ============
</TABLE>
See notes to consolidated financial statements
-2-
RELIANCE FINANCIAL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
September 30 December 31
ASSETS 1995 1994
(Dollars in thousands, except per-share amount)
<S> <C> <C>
Marketable securities:
Fixed maturities held for investment - at amortized cost
(quoted market $1,221,739 and $1,053,551)................ $ 1,202,856 $ 1,166,020
Fixed maturities available for sale - at quoted market
(amortized cost $1,834,918 and $1,945,919)............... 1,863,772 1,839,312
Equity securities - at quoted market (cost $373,294
and $482,529)............................................ 539,220 564,636
Short-term investments...................................... 437,849 229,906
Cash............................................................. 45,947 46,814
Premiums receivable.............................................. 1,127,049 1,079,393
Other accounts and notes receivable.............................. 147,315 179,903
Reinsurance recoverables......................................... 3,173,459 2,928,533
Federal and foreign income taxes, including deferred taxes....... 64,061 161,013
Notes receivable from parent company............................. 173,836 187,065
Investments in real estate - at cost, less accumulated
depreciation................................................ 279,945 289,465
Investment in investee company................................... 157,617 147,513
Deferred policy acquisition costs................................ 191,362 181,938
Other assets..................................................... 369,722 336,254
------------ -----------
$ 9,774,010 $ 9,337,765
============ ===========
LIABILITIES AND SHAREHOLDER'S EQUITY
Unearned premiums................................................ $ 1,272,554 $ 1,288,454
Unpaid claims and related expenses............................... 6,072,832 5,809,546
Accounts payable and accrued expenses............................ 623,340 650,374
Reinsurance ceded premiums payable............................... 318,766 291,844
Senior reset notes............................................... 40,315 80,596
Term loans and short-term debt................................... 170,536 129,355
Minority interests - redeemable preferred stock of a
subsidiary.................................................. - 23,517
------------ -----------
8,498,343 8,273,686
------------ -----------
Contingencies and commitments
Shareholder's equity:
Common stock, par value $.10 per share, 1,000 shares
authorized, issued and outstanding....................... - -
Additional paid-in capital.................................. 678,742 678,502
Retained earnings........................................... 492,816 434,676
Net unrealized gain (loss) on investments................... 126,531 (27,881)
Net unrealized loss on foreign currency translation......... (22,422) (21,218)
------------ -----------
1,275,667 1,064,079
------------ -----------
$ 9,774,010 $ 9,337,765
============ ===========
</TABLE>
See notes to consolidated financial statements
-3-
RELIANCE FINANCIAL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDER'S EQUITY (UNAUDITED)
<TABLE>
<CAPTION>
Net
Unrealized
Net Loss on
Additional Unrealized Foreign
Common Paid-In Retained Gain (Loss) on Currency Shareholder's
Stock Capital Earnings Investments Translation Equity
(In thousands)
<S> <C> <C> <C> c <C> <C>
Balance, January 1, 1995........................ $ - $ 678,502 $ 434,676 $ (27,881) $ (21,218) $ 1,064,079
Transactions of investee
company ................................... 240 9,142 9,382
Net income...................................... 133,392 133,392
Loss on early extinguishment of
redeemable preferred stock
of a subsidiary............................ (252) (252)
Dividends....................................... (75,000) (75,000)
Appreciation after deferred
income taxes............................... 145,270 145,270
Foreign currency translation.............. (1,204) (1,204)
----- ---------- --------- -------------- ---------- -------------
Balance, September 30, 1995................ $ - $ 678,742 $ 492,816 $ 126,531 $ (22,422) $ 1,275,667
===== ========== ========= ============== ========== =============
</TABLE>
See notes to consolidated financial statements
-4-
RELIANCE FINANCIAL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS (UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended September 30 1995 1994
(In thousands)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES............................. $ 16,816 $ 197,638
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of fixed maturities available for sale....... 358,728 323,869
Proceeds from sales of fixed maturities held for investment...... 39,218 15,405
Proceeds from redemptions of fixed maturities available for sale. 20,640 45,912
Proceeds from redemptions of fixed maturities held for investment 17,811 15,129
Proceeds from sales of equity securities......................... 350,508 149,788
(Increase) decrease in short-term investments - net.............. (209,403) 189,315
Purchases of fixed maturities available for sale................. (256,386) (396,638)
Purchases of fixed maturities held for investment................ (95,012) (256,947)
Purchases of equity securities................................... (146,126) (172,338)
Other - net...................................................... (11,954) (41,207)
----------- -----------
68,024 (127,712)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Decrease (increase) in notes receivable from parent company...... 13,229 (15,976)
Increase in term loans........................................... 75,222 35,202
Decrease in short-term debt - net................................ (31,179) (290)
Repayments of term loans......................................... (2,862) (68,942)
Repurchase of senior reset notes................................. (40,348) -
Debt issuance costs.............................................. (1,000) -
Dividends........................................................ (75,000) (55,000)
Redemption of redeemable preferred stock of a subsidiary......... (23,769) (3,360)
----------- -----------
(85,707) (108,366)
----------- -----------
Decrease in cash................................................. (867) (38,440)
Cash, beginning of period........................................ 46,814 91,608
----------- -----------
Cash, end of period.............................................. $ 45,947 $ 53,168
=========== ===========
Supplemental disclosures of cash flow information:
Interest paid.................................................... $ 11,600 $ 9,800
=========== ===========
Income taxes paid................................................ $ 42,700 $ 17,500
=========== ===========
</TABLE>
Supplemental disclosure of non-cash financing activity:
In 1994, non-cash dividends of $20,000,000 were recorded as a reduction
in notes receivable from parent company.
See notes to consolidated financial statements
-5-
RELIANCE FINANCIAL SERVICES CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. Unaudited Consolidated Financial Statements
In the opinion of management, the accompanying unaudited consolidated
financial statements include all adjustments (consisting of normal
recurring accruals only) considered necessary to present fairly the
financial position at September 30, 1995, and the results of operations,
changes in shareholder's equity and cash flows for all periods presented.
The results of operations for the interim periods are not necessarily
indicative of the results that may be expected for any other interim period
or for the entire year.
For a summary of significant accounting policies (which have not changed
from December 31, 1994) and additional financial information, see the
Company's Annual Report on Form 10-K for the year ended December 31, 1994.
On April 26, 1995, the Company extended its revolving credit facility
through March 31, 2000 from December 31, 1998. In addition, the Company
increased term loan borrowings to $137.5 million from $62.5 million and
extended the maturity dates of the term loan borrowings through March 31,
2000. The additional $75.0 million of borrowings under the term loan were
used to redeem $25.0 million of the Company's 10.36% senior reset notes and
$25.0 million of 9.48% senior reset notes, including $9.7 million of notes
held by Reliance Insurance Company. These transactions resulted in an
after-tax extraordinary loss of $3.4 million. In addition, in the second
quarter of 1995, all of the outstanding redeemable preferred stock of
Reliance Insurance Company ($23.8 million) was redeemed. The cost of the
early redemption in excess of the carrying value of the preferred stock,
$252,000, was charged directly to shareholder's equity.
2. Equity In Investee Company
Equity income in Zenith National Insurance Corp. ("Zenith") was $2.1
million and $6.2 million for the third quarter and first nine months of
1995 compared to $2.8 million and $7.6 million in the corresponding 1994
periods. In addition, in the third quarter and first nine months of 1995,
the Company recognized an after-tax loss of $4.5 million on the disposal of
discontinued life insurance operations by Zenith. The Company's prior
period results of operations have not been reclassified since amounts
attributable to these operations are not significant.
-6-
Summarized financial information for Zenith National Insurance Corp. is as
follows:
Nine Months Ended September 30 1995 1994
(In thousands, except per-share amounts)
Revenues . . . . . . . . . . . . . . . . . $ 388,328 $ 381,943
Income from continuing operations before
income taxes . . . . . . . . . . . . . . 26,449 35,774
Loss on disposal of discontinued operations (19,000) -
Net income . . . . . . . . . . . . . . . . 5,300 29,200
Net income per share . . . . . . . . . . . .29 1.53
3. Reinsurance
The reconciliation of property and casualty insurance direct premiums to
net premiums is as follows (in thousands):
Nine Months Ended September 30
1995 1994
Premiums Premiums Premiums Premiums
Written Earned Written Earned
Direct. . . . . $2,027,009 $2,027,769 $1,999,501 $1,973,609
Assumed . . . . 264,566 268,665 253,369 256,923
Ceded . . . . . (928,255) (954,874) (869,360) (864,384)
---------- ---------- ---------- ----------
Net premiums. . $1,363,320 $1,341,560 $1,383,510 $1,366,148
========== ========== ========== ==========
The reconciliation of property and casualty insurance gross policy claims
and settlement expenses to net policy claims and settlement expenses is as
follows (in thousands):
Nine Months Ended
September 30
1995 1994
Gross . . . . . . . . . . . . . . . . . $1,472,419 $1,731,724
Reinsurance recoveries. . . . . . . . . (566,697) (753,715)
---------- ----------
Net policy claims and settlement expenses $ 905,722 $ 978,009
========== ==========
Effective January 1, 1995, the Company has entered into an aggregate excess
of loss reinsurance agreement. This agreement indemnifies the Company for
ultimate net property and casualty insurance losses in excess of a specified
retention for the 1995 accident year up to a maximum aggregate limit of $100
million.
-7-
RELIANCE FINANCIAL SERVICES CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE CONSOLIDATED STATEMENT OF INCOME
Overview
The Company had income from operations, before gain on sales of
investments, of $43.8 million and $122.6 million in the third quarter and
first nine months of 1995 compared to $41.0 million and $96.5 million in
the corresponding 1994 periods. The increase in operating income resulted
from improved results in the property and casualty insurance operations.
Net income in the third quarter and first nine months of 1995 was $46.0
million and $133.4 million which included after-tax gains of $6.6 million
and $18.7 million on sales of investments and, in the first nine months of
1995, from the sale of certain consulting operations. Net income in the
third quarter and first nine months of 1994 was $43.2 million and $102.2
million which included an after-tax gain on sales of investments of $2.2
million and $5.7 million. In the third quarter and first nine months of
1995, the Company recognized an after-tax loss of $4.5 million on the disposal
of discontinued life insurance operations by an investee company. In the
first nine months of 1995, the early extinguishment of debt resulted in an
after-tax extraordinary loss of $3.4 million.
Property and Casualty Insurance Operations
Net premiums written and net premiums earned increased in the third quarter of
1995 to $458.3 million and $447.2 million from $413.3 million and $427.9 million
in the corresponding 1994 period. These increases are primarily due to growth
in retrospectively rated workers' compensation premiums. During the first half
of 1995, workers' compensation premiums had declined resulting from the shift to
high deductible insurance and captive insurance programs, as well as an increase
in return premiums on retrospectively rated policies. As a result, net premiums
written and net premiums earned for the first nine months of 1995 declined to
$1.36 billion and $1.34 billion from $1.38 billion and $1.37 billion in the
corresponding 1994 period.
The property and casualty insurance operations continue to experience
strong underwriting results particularly in workers' compensation, surety,
and ocean and inland marine lines of business. Underwriting losses for the
third quarter and first nine months of 1995 were $10.9 million and $24.0
million compared to $14.7 million and $75.7 million in the corresponding
1994 periods. The improved underwriting results reflect increased
underwriting profits in the surety line of business of $12.8 million and
$37.7 million in the third quarter and first nine months of 1995 compared
to $6.2 million and $18.4 million in the corresponding 1994 periods.
Catastrophe losses totalled $5.9 million and $13.2 million in the quarter
and nine months ended September 30, 1995 compared to $4.7 million and $40.0
million in the corresponding 1994 periods. Catastrophe losses in the first
nine
-8-
months of 1994 arose primarily from the January 1994 California earthquake.
The combined ratio (calculated on a GAAP basis), after policyholders'
dividends, was 101.8% and 101.5% in the third quarter and first nine months of
1995 (100.5% and 100.5%, excluding the effects of catastrophes), compared to
102.8% and 105.1% in the corresponding 1994 periods (101.6% and 102.1%,
excluding the effects of catastrophes).
On October 23, 1995, the Company agreed to settle two actions in the
District Court of Dallas County, Texas, regarding alleged overcharges for
workers' compensation insurance and multiple line retrospectively rated
casualty insurance between 1987 and 1992. Under the terms of the
settlement, which were preliminarily approved by the Court on October 27,
1995 and which are subject to final court approval, the amount to be paid
is to be determined after a review conducted by an independent accounting
firm. The Company estimates that it will pay approximately $12 million
under the settlement. This will not affect the Company's financial results
since the Company had previously provided for this matter. The actions
were previously disclosed in the Company's Annual Report on Form 10-K for
the year ended December 31, 1994.
Property and Casualty Insurance Investment Results
Net investment income of the property and casualty insurance operations
increased to $61.7 million and $183.7 million in the three-month and nine-
month periods ended September 30, 1995 from $58.7 million and $172.9
million in the corresponding 1994 periods. These increases resulted from
growth in the size of the fixed maturity investment portfolio and an
increase in interest rates.
Gain on sales of investments increased to $10.1 million and $25.9 million
in the third quarter and first nine months of 1995 from $3.4 million and
$8.1 million in the corresponding 1994 periods. These increases primarily
resulted from sales of certain equity securities.
Title Insurance Operations
Premiums and fees in the third quarter and first nine months of 1995
declined to $171.6 million and $481.9 million from $195.6 million and
$677.9 million in the comparable 1994 periods. These declines resulted
from a decrease in lower margin agency revenues. The 1994 periods benefitted
from strong agency revenues resulting from the typical reporting lag of 90-120
days and reflected the strong market conditions that existed in early 1994 and
late 1993.
-9-
As a result of lower agency revenues, agency commissions in the third
quarter and first nine months of 1995 declined to $75.0 million and $221.5
million from $94.9 million and $345.1 million in the corresponding 1994
periods. The expense ratio of the title insurance operations (which
includes agency commissions) was 90.7% and 94.2% in the third quarter and
first nine months of 1995 compared to 90.0% and 89.6% in the corresponding
1994 periods. The increase in the 1995 expense ratios resulted from the
decline in premiums. Other expenses were $81.6 million and $235.0 million
in the three-month and nine-month periods ended September 30, 1995 compared
to $82.5 million and $266.2 million in the corresponding 1994 periods. The
decline in other expenses during the first nine months of 1995 reflects
various cost control programs, including staff reductions, undertaken by
the Company. As a result of lower premiums, the provision for claim losses
declined to $14.9 million and $41.9 million in the third quarter and first
nine months of 1995 from $17.3 million and $60.2 million in the
corresponding 1994 periods.
Investment Portfolio
At September 30, 1995, the Company's investment portfolio aggregated $3.89
billion (at cost) of which 10% was invested in equity securities. The
Company seeks to maintain a diversified and balanced fixed maturity
portfolio representing a broad spectrum of industries and types of
securities. At September 30, 1995, no one issuer comprised more than 2.5%
of the fixed maturity and short-term investment portfolio. Furthermore,
the Company holds virtually no investments in commercial real estate
mortgages in its investment portfolio. Purchases of fixed maturity
securities are researched individually based on in-depth analysis and
objective predetermined investment criteria and the portfolio is managed to
achieve a proper balance of safety, liquidity and investment yields.
The Company's fixed maturity portfolio consists of investment grade
securities (those rated "BBB" or better by Standard & Poor's) and, to a
lesser extent, non-investment grade and non-rated securities. The risk of
default is generally considered to be greater for non-investment grade
securities, when compared to investment grade securities since these issues
may be more susceptible to severe economic downturns. At September 30,
1995, the carrying values of non-investment grade securities and securities
not rated by Standard & Poor's were $300.1 million (8% of the fixed income
portfolio) and $78.5 million (2% of the fixed income portfolio),
respectively. Substantially all of the Company's non-investment grade and
non-rated securities are classified as available for sale and, accordingly,
are carried at market value.
-10-
Other Operations
The Company's consulting and technical services operations provide services
in the information technology and energy fields. Revenues for these
operations were $36.5 million and $115.0 million in the third quarter and
first nine months of 1995. Revenues for the first nine months of 1995
includes a pre-tax gain of $2.6 million resulting from the sales of certain
consulting operations. These sales are not expected to have a material
effect on the Company's operations. Revenues in the third quarter and
first nine months of 1994 were $36.8 million and $105.4 million. Operating
expenses were $34.9 million and $108.0 million in the three-month and nine-
month periods ending September 30, 1995 compared to $34.3 million and
$100.4 million in the corresponding 1994 periods. Revenues and expenses of
these operations are included in other revenues and other expenses in the
accompanying statement of income.
At September 30, 1995, the Company's real estate holdings had a carrying
value of $279.9 million, which includes nine shopping centers with an
aggregate carrying value of $130.3 million, office buildings and other
commercial properties, with an aggregate carrying value of $88.5 million,
and undeveloped land with a carrying value of $61.1 million.
Other Matters
The Company has a revolving credit facility with various banks providing
for aggregate maximum outstanding borrowings of $100.0 million. At
September 30, 1995, borrowings aggregating $15.0 million were outstanding
under this facility. On April 26, 1995, the Company extended the revolving
credit facility through March 31, 2000 from December 31, 1998. In
addition, the Company increased term loan borrowings to $137.5 million from
$62.5 million and extended the maturity dates of the term loan borrowings
through March 31, 2000. The additional $75.0 million of borrowings under
the term loan were used to redeem $25.0 million of the Company's 10.36%
senior reset notes and $25.0 million of 9.48% senior reset notes, including
$9.7 million of notes held by Reliance Insurance Company. These
transactions resulted in an after-tax extraordinary loss of $3.4 million.
In addition, in the second quarter of 1995, all of the outstanding
redeemable preferred stock of Reliance Insurance Company ($23.8 million)
was redeemed. The cost of the early redemption in excess of the carrying
value of the preferred stock, $252,000, was charged directly to
shareholder's equity.
The National Association of Insurance Commissioners has adopted a risk-
based capital requirement for the property and casualty insurance industry,
effective in 1995, based on 1994 annual statutory financial statements.
Risk-based capital refers to the determination of the amount of statutory
capital required for an insurer based on the risks assumed by the insurer
(including, for example, investment risks, credit risks relating to
reinsurance recoverables and underwriting risks) rather than just the
amount of net premiums written by the insurer. A formula that applies
prescribed factors to the various risk elements in an
-11-
insurer's business is used to determine the minimum statutory capital
requirement for the insurer. An insurer having less statutory capital than
the formula calculates would be subject to varying degrees of regulatory
intervention, depending on the level of capital inadequacy. All of the
Company's statutory insurance companies have statutory capital in excess of
the minimum required risk-based capital.
Maintaining appropriate levels of statutory surplus is considered important
by the Company's management, state insurance regulatory authorities and the
agencies that rate insurers' claims-paying abilities and financial
strength. Failure to maintain certain levels of statutory capital and
surplus could result in increased scrutiny or, in some cases, action taken
by state regulatory authorities and/or downgrades in an insurer's ratings.
-12-
RELIANCE FINANCIAL SERVICES CORPORATION AND SUBSIDIARIES
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
27. Financial Data Schedule
(b) Reports on Form 8-K.
No reports on Form 8-K were filed during the quarter ended
September 30, 1995.
-13-
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.
RELIANCE FINANCIAL SERVICES CORPORATION
(Registrant)
Date: November 14, 1995 /s/ George E. Bello
George E. Bello
Executive Vice President and Controller
(Chief Accounting Officer)
-14-
<TABLE> <S> <C>
<ARTICLE> 7
<LEGEND>
Exhibit 27
This schedule contains summary financial information extracted from the
Company's Consolidated Balance Sheet and the Consolidated Statement of Income
and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1995
<DEBT-HELD-FOR-SALE> 1,863,772
<DEBT-CARRYING-VALUE> 1,202,856
<DEBT-MARKET-VALUE> 1,221,739
<EQUITIES> 539,220
<MORTGAGE> 0
<REAL-ESTATE> 279,945
<TOTAL-INVEST> 4,323,642
<CASH> 45,947
<RECOVER-REINSURE> 3,173,459
<DEFERRED-ACQUISITION> 191,362
<TOTAL-ASSETS> 9,774,010
<POLICY-LOSSES> 6,072,832
<UNEARNED-PREMIUMS> 1,272,554
<POLICY-OTHER> 0
<POLICY-HOLDER-FUNDS> 0
<NOTES-PAYABLE> 210,851
0
0
<COMMON> 0
<OTHER-SE> 1,275,667
<TOTAL-LIABILITY-AND-EQUITY> 9,774,010
1,823,454
<INVESTMENT-INCOME> 204,467
<INVESTMENT-GAINS> 26,142
<OTHER-INCOME> 130,431
<BENEFITS> 947,632
<UNDERWRITING-AMORTIZATION> 301,545
<UNDERWRITING-OTHER> 609,466
<INCOME-PRETAX> 199,876
<INCOME-TAX> (64,000)
<INCOME-CONTINUING> 141,252
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</TABLE>
