<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE,
SAVINGS AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF
THE SECURITIES
EXCHANGE ACT OF 1934
(X) ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996
OR
( ) TRANSITION REPORT PURSUANT TO 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
COMMISSION FILE NUMBER 0-20526
OLYMPIC FINANCIAL LTD.
401(k) PROFIT SHARING PLAN
(TITLE OF THE PLAN)
ARCADIA FINANCIAL LTD.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
MINNESOTA 41-1664848
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
7825 WASHINGTON AVENUE SOUTH, MINNEAPOLIS, MINNESOTA 55439-2435
(Address of principal executive offices)
Registrant's telephone number, including area code: (612) 942-9880
<PAGE>
FINANCIAL STATEMENTS
OLYMPIC FINANCIAL LTD.
401(k) PROFIT SHARING PLAN
YEARS ENDED DECEMBER 31, 1996 AND 1995
<PAGE>
Olympic Financial Ltd. 401(k) Profit Sharing Plan
Financial Statements
Years ended December 31, 1996 and 1995
CONTENTS
Report of Independent Auditors.................................................1
Financial Statements
Statements of Net Assets Available for Benefits................................2
Statements of Changes in Net Assets Available for Benefits.....................2
Notes to Financial Statements..................................................3
Item 27(a)--Schedule of Assets Held for Investment Purposes....................8
Item 27(d)--Schedule of Reportable Transactions................................9
<PAGE>
[LETTERHEAD]
Report of Independent Auditors
Olympic Financial Ltd. 401(k)
Profit Sharing Plan Committee
We have audited the accompanying statements of net assets available for benefits
of Olympic Financial Ltd. 401(k) Profit Sharing Plan as of December 31, 1996 and
1995, and the related statements of changes in net assets available for benefits
for the years then ended. These financial statements are the responsibility of
the Plan's management. Our responsibility is to express an opinion on these
financial statements 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 are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. 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 referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan at
December 31, 1996 and 1995, and the changes in its net assets available for
benefits for the years then ended, in conformity with generally accepted
accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying supplemental schedules
of assets held for investment purposes as of December 31, 1996, and reportable
transactions for the year then ended, are presented for purposes of complying
with the Department of Labor's Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act of 1974, and are
not a required part of the basic financial statements. The supplemental
schedules have been subjected to the auditing procedures applied in our audits
of the basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
The information presented in the "Schedule of Reportable Transactions" and
certified by the custodian does not disclose the historical cost of investments
sold, and related gain or loss. Disclosure of this information is required by
the Department of Labor's Rules and Regulations for Reporting and Disclosure
under the Employee Retirement Income Security Act of 1974.
May 9, 1997
1
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Olympic Financial Ltd. 401(k) Profit Sharing Plan
Statements of Net Assets Available for Benefits
<TABLE>
<CAPTION>
DECEMBER 31
1996 1995
--------------------------
<S> <C> <C>
ASSETS
Cash $ - $ 3,526
Investments:
Mutual funds 742,651 167,177
Olympic Financial Ltd. Common stock 315,503 154,202
Participant notes receivable 1,800 -
--------------------------
1,059,954 321,379
Employer contributions receivable 430,732 120,102
Employee contributions receivable 14,370 10,204
--------------------------
Net assets available for benefits $1,505,056 $455,211
--------------------------
--------------------------
Statements of Changes in Net Assets Available for Benefits
YEAR ENDED DECEMBER 31
1996 1995
--------------------------
<S> <C> <C>
Additions:
Employee contributions $ 673,807 $352,997
Employer contributions 430,732 120,102
Investment income 37,898 6,252
--------------------------
1,142,437 479,351
Deductions:
Benefits paid 66,680 9,485
Net realized and unrealized depreciation in fair
value of investments (25,912) (14,655)
--------------------------
Net increase 1,049,845 455,211
Net assets available for benefits at beginning of year 455,211 -
--------------------------
Net assets available for benefits at end of year $1,505,056 $455,211
--------------------------
--------------------------
</TABLE>
SEE ACCOMPANYING NOTES.
2
<PAGE>
Olympic Financial Ltd. 401(k) Profit Sharing Plan
Notes to Financial Statements
December 31, 1996
1. DESCRIPTION OF THE PLAN
GENERAL
Olympic Financial Ltd. 401(k) Profit Sharing Plan (the Plan) is a defined
contribution plan sponsored by Olympic Financial Ltd. (the Company). The Plan
became effective on January 1, 1995. An employee is eligible to participate in
the Plan upon attaining the age of 21 and completing a qualifying period of 12
consecutive months of employment within which the employee has had at least
1,000 credited hours of service.
The following description of the Plan provides only general information.
Participants should refer to the Plan agreement for a more complete description
of the Plan's provisions.
CONTRIBUTIONS
The participants may contribute up to 10% of his or her annual compensation to
any of the investment funds. Matching contributions by the Company are made at a
percentage of the participant's contribution which the Company, in its sole
discretion, determines from year to year. Effective beginning in the 1996 plan
year, participants must be employed on December 31 of each year to receive the
matching contribution for that year.
VESTING
Participants are fully vested at all times for participant contribution amounts.
Matching contributions by the Company are vested 20% each year beginning year
two; fully vested at the end of year six of vested service. Effective April 29,
1996, the Board of Directors of the Company approved a revised vesting schedule
that provides 50% vesting after one year and 100% vesting after two years of
service.
3
<PAGE>
Olympic Financial Ltd. 401(k) Profit Sharing Plan
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
PARTICIPANT LOANS AND HARDSHIP WITHDRAWALS
Participants can borrow up to the lesser of $50,000 or one-half of their vested
account balance. Interest on loans accrues at prime rate plus 2%. Loans are
collateralized by the participant's account balance. There was one loan
outstanding at December 31, 1996 and none at December 31, 1995.
Hardship withdrawals of elective deferrals are permitted by the Plan, as
described in the Plan agreement.
PAYMENT OF BENEFITS
Benefits are typically paid as soon as practicable after a participant retires,
dies, becomes disabled or is terminated from the Company. Benefits are payable
in the form of a lump sum distribution or installments over a fixed period of
years depending on the participant's request.
PLAN TERMINATION
In the event the Plan terminates, the accounts of all participants continue to
share in trust earnings, gains or losses until such time as distributions are
made.
FEES AND EXPENSES
All administrative expenses of the Plan are paid for by the Company. Commissions
for the purchase or sale of investments, if applicable, are paid by the Plan and
are added to the cost of investments purchased or subtracted from the proceeds
of investments sold.
4
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Olympic Financial Ltd. 401(k) Profit Sharing Plan
Notes to Financial Statements (continued)
2. SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The accounting records of the Plan are maintained on the accrual basis.
INVESTMENTS
Olympic Financial Ltd. Common stock is stated at fair value (the last reported
sales price on the last business day of the year). Fair value of mutual funds
represents the net asset value of the fund shares which is calculated based on
the valuation of the fund's underlying investments at fair value at the end of
the year.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates that affect the
amounts reported in the financial statements and accompanying notes. Actual
results could differ from those estimates.
5
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Olympic Financial Ltd. 401(k) Profit Sharing Plan
Notes to Financial Statements (continued)
3. INVESTMENTS
The Plan's assets have been deposited in investment funds managed by a trust
company. Allocation of contributions to the available investment funds is based
upon the employee's choice. The changes in assets of each fund during the years
ended December 31, 1996 and 1995 were as follows:
<TABLE>
<CAPTION>
IDS CASH OLYMPIC
IDS NEW IDS BOND MANAGEMENT COMPANY LOAN
DIMENSIONS IDS MUTUAL FUND FUND STOCK FUND UNALLOCATED TOTAL
------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Additions:
Contributions $ 85,610 $ 44,384 $15,654 $13,673 $179,946 $ - $133,832 $ 473,099
Investment income 3,856 1,409 470 299 218 - - 6,252
------------------------------------------------------------------------------------------
89,466 45,793 16,124 13,972 180,164 - 133,832 479,351
Deductions:
Benefits paid to participants 2,222 1,893 579 1,133 3,658 - - 9,485
Interfund-transfers (net) 265 (19) (478) (612) 844 - - -
Net realized and unrealized appreciation
(depreciation) in current value of
investments 5,480 2,307 709 (3) (23,148) - - (14,655)
------------------------------------------------------------------------------------------
5,745 2,288 231 (615) (22,304) - - (14,655)
------------------------------------------------------------------------------------------
Net assets available for benefits at
December 31, 1995 92,989 46,188 15,776 12,224 154,202 - 133,832 455,211
Additions:
Contributions 476,944 241,440 63,842 39,272 416,873 - (133,832) 1,104,539
Investment income 16,659 17,157 2,649 1,217 216 - - 37,898
------------------------------------------------------------------------------------------
493,603 258,597 66,491 40,489 417,089 - (133,832) 1,142,437
Deductions:
Benefits paid to participants 20,570 14,260 3,965 3,885 24,000 - - 66,680
Interfund-transfers (net) 19,885 (2,249) 4,343 1,544 (25,323) 1,800 - -
Net realized and unrealized appreciation
(depreciation) in current value of
investments 43,357 1,838 (101) (4) (71,002) - - (25,912)
------------------------------------------------------------------------------------------
63,242 (411) 4,242 1,540 (96,325) 1,800 - (25,912)
------------------------------------------------------------------------------------------
Net assets available for benefits at
December 31, 1996 $629,264 $290,114 $82,544 $50,368 $450,966 $1,800 $ - $1,505,056
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
</TABLE>
6
<PAGE>
Olympic Financial Ltd. 401(k) Profit Sharing Plan
Notes to Financial Statements (continued)
3. INVESTMENTS (CONTINUED)
Investments that represent 5% or more of the Plan's net assets are as follows:
DECEMBER 31, 1996
-----------------
IDS New Dimensions Fund, 21,750 shares $450,209
IDS Mutual, 14,919 shares 201,064
Olympic Financial Ltd. Stock, 22,117 shares 315,503
DECEMBER 31, 1995
-----------------
IDS New Dimensions Fund, 5,385 shares $ 92,989
IDS Mutual, 3,532 shares 46,188
Olympic Financial Ltd. Stock, 9,489 shares 154,202
4. INCOME TAX STATUS
The form of the Plan has received a determination letter from the Internal
Revenue Service (IRS) dated September 15, 1994, stating that the form of the
Plan is acceptable under Section 401(a) of the Internal Revenue Code of 1986
(the "Code"). The Plan has requested, but not yet received, a determination
letter from the IRS. The Administrator believes the Plan is qualified and
therefore, exempt from taxation. Once qualified, the Plan is required to operate
in conformity with the Code and ERISA to maintain its tax-exempt status. The
Administrator is not aware of any course of action or series of events that have
occurred that might adversely affect the Plan's qualified status.
7
<PAGE>
Olympic Financial Ltd. 401(k) Profit Sharing Plan
Item 27(a)--Schedule of Assets Held for Investment Purposes
E.I.N. 41-1664848
Plan #001
December 31, 1996
IDENTITY OF ISSUER, BORROWER FAIR
OR SIMILAR PARTY UNITS HELD COST VALUE
- --------------------------------------------------------------------------------
IDS New Dimensions Fund 21,750 shares $ 404,338 $ 450,209
IDS Mutual 14,919 shares 197,678 201,064
IDS Bond Fund 11,199 shares 57,117 57,572
IDS Cash Management Fund 33,783 shares 33,783 33,806
Olympic Financial Ltd. Stock* 22,117 shares 403,965 315,503
Participant Loan (10.25% interest
rate, matures on 12/31/98) 0 1,800
--------------------------
$1,096,881 $1,059,954
--------------------------
--------------------------
*Indicates party-in-interest to the Plan.
8
<PAGE>
Olympic Financial Ltd. 401(k) Profit Sharing Plan
Item 27(d)--Schedule of Reportable Transactions
E.I.N. 41-1664848
Plan #001
Year ended December 31, 1996
<TABLE>
<CAPTION>
CURRENT VALUE
OF ASSET ON
PURCHASE SELLING COST OF TRANSACTION NET GAIN
IDENTITY OF PARTY INVOLVED DESCRIPTION OF ASSET PRICE PRICE ASSET DATE OR (LOSS)
- ------------------------------------------------------------------------------------------------------------------------------------
CATEGORY (iii)--SERIES OF TRANSACTIONS IN EXCESS OF 5% OF PLAN ASSETS
<S> <C> <C> <C> <C> <C> <C>
Olympic Financial Ltd. Purchased 14,240 units in 27 transactions $255,274 $255,274 $255,274
Sold 1,612 units in 11 transactions $23,238 28,896 23,238 $(5,658)
IDS New Dimension Fund Purchased 17,228 units in 52 transactions 331,496 331,496 331,496
Sold 1,099 units in 21 transactions 21,861 * 21,861 *
IDS Mutual Purchased 12,671 units in 43 transactions 170,348 170,348 170,348
Sold 1,083 units in 23 transactions 14,630 * 14,630 *
IDS Bond Fund Purchased 9,226 units in 49 transactions 47,315 47,315 47,315
Sold 890 units in 12 transactions 4,532 * 4,532 *
IDS Cash Management Purchased 27,246 units in 41 transactions 27,246 27,246 27,246
Sold 4,576 units in 11 transactions 4,576 4,576 4,576 -
</TABLE>
There were no category (i), (ii) or (iv) transactions in the year ended December
31, 1996.
*This information is not available.
9
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the employee benefit plan) have duly
caused this annual report to be signed on its behalf by the undersigned hereunto
duly authorized.
OLYMPIC FINANCIAL LTD.
401(k) PROFIT SHARING PLAN
Date: June 30, 1996 By: /s/ John A. Witham
------------------------------------
John A. Witham
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
By: /s/ Mary E. West
------------------------------------
Mary E. West
Senior Vice President,
Human Resources
10
