SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1998
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 0-19048
Bear Stearns Asset Backed Investors Corp.
(Exact name of registrant asspecified in its charter)
Delaware 13-3579047
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
245 Park Avenue, New York, New York 10167
(Address of principal executive offices) (Zip Code)
(212) 272-2000
(Registrant's number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding twelve 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
THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)
(a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED
DISCLOSURE FORMAT CONTEMPLATED THEREBY.
<PAGE>
BEAR STEARNS ASSET BACKED INVESTORS CORP.
INDEX
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
Statement of Financial Condition at December 31, 1998
(Unaudited) and June 30, 1998
Note to Statement of Financial Condition (Unaudited)
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Part II. OTHER INFORMATION
Item 1. Legal Proceedings
Item 6. Exhibits and Reports on Form 8-K
Signature
<PAGE>
BEAR STEARNS ASSET BACKED INVESTORS CORP.
STATEMENT OF FINANCIAL CONDITION
December 31, June 30,
1998 1998
(Unaudited)
Assets
Cash $100 $100
------- -------
Total Assets $100 $100
==== ====
Stockholders Equity
Common Stock, $1.00 par value;
1,000 shares authorized issued
and outstanding $100 $100
------- -------
Total Stockholders Equity $100 $100
==== ====
See note to statements of financial condition.
<PAGE>
BEAR STEARNS ASSET BACKED INVESTORS CORP.
NOTE TO STATEMENT OF FINANCIAL CONDITION
(UNAUDITED)
Note 1. Organization
Bear Stearns Asset Backed Investors Corp. (the "Company"), a direct
wholly-owned limited purpose subsidiary of The Bear Stearns Companies Inc.
("Bear Stearns"), was organized on January 26, 1989. The Company was formed
solely for the purpose of issuing directly or through trusts established by it,
in series, debt securities that are secured or collateralized by one or more
pools of retail installment sales contracts or loan agreements secured by new or
used automobile or light-duty trucks, net of servicing and other fees, security
interests in the vehicles financed thereby, and certain other collateral. As of
December 31, 1998, the Company had not commenced its intended activities, except
for the conduct of non-recurring organizational matters and activities, the cost
for which were borne by an affiliate. Accordingly, the Company had no results of
operations for the six months ended December 31, 1998 and therefore no Statement
of Operations is presented. All funds were obtained from initial capital
transactions. As a result, no Statement of Cash Flows is presented.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
As of December 31, 1998, the Company had not commenced its intended
activities, except for the conduct of non-recurring organizational matters and
activities, the cost for which was borne by an affiliate. Accordingly, the
Company had no results of operations for the six months ended December 31, 1998
Year 2000 Issue
The Year 2000 issue is the result of legacy computer programs being written
using two digits rather than four digits to define the applicable year and
therefore, without consideration of the impact of the upcoming change in the
century. Such programs may not be able to accurately process dates ending in the
year 2000 and thereafter. All hardware and software used by the Company is
through The Bear Stearns Companies, Inc. and affiliates (BSC). BSC determined
that they need to modify or replace portions of their software and hardware so
that its computer system will properly utilize dates beyond December 31, 1999.
Over three years ago, BSC established a task force to review and develop an
action plan to address the Year 2000 issue. BSCs action plan addresses both
information technology and non-information technology system compliance issues.
Since then, the ongoing assessment and monitoring phase has continued and
includes assessment of the degree of compliance of its significant vendors,
facility operators, custodial banks and fiduciary agents to determine the extent
to which BSC is vulnerable to those third parties failure to remediate their
own year 2000 issues. BSC has contacted all significant external vendors in an
effort to confirm their readiness for the Year 2000 and plans to test
compatibility with such converted systems. BSC also participates in
industry-wide tests.
BSC has and will continue to utilize both internal and external resources
to reprogram, or replace, and test the software and hardware for Year 2000
modifications. To date, the amounts incurred and expensed related to the
assessment of, and efforts in connection with, the Year 2000 and the development
of a remediation plan have approximated $31.3 million. BSC total projected Year
2000 project cost, including the estimated costs and time associated with the
impact of third party Year 2000 issues, are based on currently available
information. BSCs total remaining Year 2000 project cost is estimated at
approximately $28.7 million which will be funded through operating cash flows
and expensed as incurred.
BSC presently believes that the activities that it is undertaking in the
Year 2000 project should satisfactorily resolve Year 2000 compliance exposures
within its own systems worldwide. BSC has substantially completed the
reprogramming and replacement phase of the project. Testing has commenced and
will proceed through calendar 1999. However, if such modifications and
conversions are not operationally effective on a timely basis, the Year 2000
issue could have a material impact on the operations of the BSC.
<PAGE>
Additionally, there can be no assurance that the systems of other companies
on which BSC systems rely will be timely converted, or that a failure to convert
by another company, or a conversion that is incompatible with BSC systems, would
not have a material adverse effect on BSC. While BSC does not have a specific,
formal contingency plan, the BSC action plan is designed to safeguard the
interests of the BSC and its customers. BSC believes that this action plan
significantly reduces the risk of a Year 2000 issue serious enough to cause a
business disruption. With regard to Year 2000 compliance of other external
entities, BSC is monitoring developments closely. Should it appear that a major
utility, such as a stock exchange, would not be ready, BSC will work with other
firms in the industry to plan an appropriate course of action.
Part II. OTHER INFORMATION
Item 1. Legal Proceedings
No legal proceedings are pending
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
None
(b) Reports on Form 8-K:
No reports on Form 8-K have been filed during the period covered by this
report.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Bear Stearns Asset Backed Investors Corp. (Registrant)
Date: February 12, 1999 By: /s/ William J. Montgoris
William J. Montgoris
Executive Vice President and Treasurer
(Principal Financial Officer)
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information from the unaudited
Statements of Financial Condition at December 31, 1998, which are contained in
the body of the accompanying Form 10-Q and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
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<PERIOD-END> DEC-31-1998
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