<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C., 20549
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30, 1996
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 1-11011
THE FINOVA GROUP INC.
(Exact name of registrant as specified in its charter)
DELAWARE 86-0695381
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1850 North Central Ave., P. O. Box 2209, Phoenix, AZ 85002-2209
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 602/207-6900
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 such shorter period that the Registrant was
required to file such report), and (2) has been subject to such filing
requirements for the past 90 days.
YES X NO
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS:
As of July 29, 1996, 27,376,000 shares of Common Stock ($0.01 par value) were
outstanding.
<PAGE> 2
THE FINOVA GROUP INC.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
PART I FINANCIAL INFORMATION.
Item 1. Financial Statements.
Condensed Consolidated Financial Information:
Condensed Consolidated Balance Sheet - June 30, 1996 and
December 31, 1995 1
Condensed Consolidated Income Statement - Three and Six Months
Ended June 30, 1996 and 1995 2
Condensed Consolidated Statement of Cash Flows - Six Months
Ended June 30, 1996 and 1995 3
Notes to Interim Condensed Consolidated Financial Information 4 - 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 6 - 8
PART II OTHER INFORMATION.
Item 4. Submission of Matters to a Vote of Security-Holders 8
Item 6. Exhibits and Reports on Form 8-K 8
SIGNATURES 9
</TABLE>
<PAGE> 3
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
THE FINOVA GROUP INC.
CONDENSED CONSOLIDATED BALANCE SHEET
(Dollars in Thousands)
<TABLE>
<CAPTION>
(Unaudited)
June 30, December 31,
ASSETS: 1996 1995
----------- ------------
<S> <C> <C>
CASH AND CASH EQUIVALENTS $ 23,252 $ 90,280
INVESTMENT IN FINANCING TRANSACTIONS:
Loans and other financing contracts, less unearned
income of $389,458 and $354,961, respectively 5,144,969 4,973,864
Direct financing leases 776,924 828,713
Operating leases 521,729 460,798
Leveraged leases 450,818 366,196
Factored receivables 347,452 189,486
---------- ----------
7,241,892 6,819,057
Less reserve for possible credit losses (148,695) (140,333)
---------- ----------
Investment in financing transactions - net 7,093,197 6,678,724
OTHER ASSETS AND DEFERRED CHARGES 323,546 267,510
---------- ----------
$7,439,995 $7,036,514
========== ==========
LIABILITIES:
Accounts payable and accrued expenses $ 94,535 $ 125,349
Due to clients 228,170 181,548
Interest payable 49,506 45,553
Senior debt 5,970,459 5,649,368
Deferred income taxes 225,672 209,512
---------- ----------
6,568,342 6,211,330
---------- ----------
STOCKHOLDERS' EQUITY:
Common stock, $0.01 par value, 100,000,000 shares
authorized, 28,422,000 shares issued 284 284
Additional capital 686,484 686,382
Retained income 227,591 184,381
Cumulative translation adjustments (5,645) (5,686)
Common stock in treasury, 1,045,000 and 1,143,000
shares respectively (37,061) (40,177)
---------- ----------
871,653 825,184
---------- ----------
$7,439,995 $7,036,514
========== ==========
</TABLE>
See notes to interim consolidated financial information.
1
<PAGE> 4
THE FINOVA GROUP INC.
CONDENSED CONSOLIDATED INCOME STATEMENT
(Dollars in Thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
--------------------------- -----------------------------
1996 1995 1996 1995
----------- ------------ ----------- ------------
<S> <C> <C> <C> <C>
Interest and income
earned from financing
transactions $ 185,510 $ 163,816 $ 371,093 $ 318,331
Operating lease income 25,042 20,877 48,015 41,119
Interest expense (99,244) (90,197) (196,300) (174,721)
Depreciation (14,625) (13,168) (31,903) (25,911)
----------- ----------- ----------- -----------
Interest margins earned 96,683 81,328 190,905 158,818
Provision for possible
credit losses (10,500) (11,600) (24,750) (18,000)
----------- ----------- ----------- -----------
Net interest margins
earned 86,183 69,728 166,155 140,818
Gains on sale of assets 882 4,073 7,539 7,053
----------- ----------- ----------- -----------
87,065 73,801 173,694 147,871
Selling, administrative and
other operating expenses (41,044) (36,420) (84,394) (72,995)
----------- ----------- ----------- -----------
Income before income
taxes 46,021 37,381 89,300 74,876
Income taxes (17,900) (13,752) (34,058) (28,879)
----------- ----------- ----------- -----------
NET INCOME $ 28,121 $ 23,629 $ 55,242 $ 45,997
=========== =========== =========== ===========
EARNINGS PER COMMON
AND EQUIVALENT
SHARE $ 1.01 $ 0.85 $ 1.98 $ 1.65
=========== =========== =========== ===========
DIVIDENDS DECLARED
PER COMMON SHARE $ 0.22 $ 0.20 $ 0.44 $ 0.40
=========== =========== =========== ===========
AVERAGE
OUTSTANDING
COMMON AND
EQUIVALENT SHARES 27,961,000 27,876,000 27,942,000 27,885,000
=========== =========== =========== ===========
</TABLE>
See notes to interim consolidated financial nformation.
2
<PAGE> 5
THE FINOVA GROUP INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended June 30,
----------------------------
OPERATING ACTIVITIES: 1996 1995
----------- ---------
<S> <C> <C>
Net income $ 55,242 $ 45,997
Adjustments to reconcile net income to net cash
provided by operating activities:
Provision for possible credit losses 24,750 18,000
Depreciation and amortization 39,918 33,332
Gains on sale of assets (7,539) (7,053)
Deferred income taxes 16,160 904
Change in assets and liabilities, net of effects
from subsidiaries purchased (87,303) (34,416)
----------- ---------
Net cash provided by operating activities 41,228 56,764
----------- ---------
INVESTING ACTIVITIES:
Proceeds from sale of assets 93,649 20,574
Proceeds from assets securitized 100,000
Principal collections on financing transactions 667,231 576,738
Expenditures for financing transactions (1,150,212) (869,130)
Net change in short-term financing transactions (44,219) (135,486)
Purchase of portfolios (795) (127,045)
Other 1,539 1,290
----------- ---------
Net cash used by investing activities (332,807) (533,059)
----------- ---------
FINANCING ACTIVITIES:
Net borrowings under commercial paper 215,392 219,072
Long-term borrowings 565,000 650,000
Repayment of long-term borrowings (523,788) (397,592)
Proceeds from exercise of stock options 2,446 3,041
Common stock purchased for treasury (14,048)
Dividends (12,032) (11,037)
Net change in due to factored clients (22,467) 1,929
----------- ---------
Net cash provided by financing activities 224,551 451,365
----------- ---------
DECREASE IN CASH AND CASH EQUIVALENTS (67,028) (24,930)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 90,280 49,875
----------- ---------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 23,252 $ 24,945
=========== =========
</TABLE>
See notes to interim consolidated financial information.
3
<PAGE> 6
THE FINOVA GROUP INC.
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED JUNE 30, 1996 AND 1995
NOTE A BASIS OF PREPARATION
The consolidated financial statements present the financial position,
results of operations and cash flows of The FINOVA Group Inc. and its
subsidiaries (collectively, "FINOVA" or the "Company"), including FINOVA Capital
Corporation and its subsidiaries (collectively, "FINOVA Capital").
The interim consolidated financial information is unaudited. In the
opinion of management all adjustments, consisting of normal recurring items,
necessary to present fairly the financial position as of June 30, 1996, the
results of operations for the quarter and six months ended June 30, 1996 and
1995 and cash flows for the six months ended June 30, 1996 and 1995, have been
included. Interim results of operations are not necessarily indicative of the
results of operations for the full year.
NOTE B SIGNIFICANT ACCOUNTING POLICIES
In March 1995, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 121, "Accounting for
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of",
effective for fiscal years beginning after December 15, 1995. This statement
establishes accounting standards for the impairment of long-lived assets,
certain identifiable intangibles and goodwill related to those assets to be held
and used and long-lived assets and certain identifiable intangibles to be
disposed of. The statement requires that long-lived assets and certain
identifiable intangibles to be held and used by an entity be reviewed for
impairment whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable. In addition, the statement
requires that certain long-lived assets and intangibles to be disposed of be
reported at the lower of carrying amount or fair value less cost to sell. The
Company adopted this accounting standard effective January 1, 1996, as required.
The effect on the Company's financial position and the results of operations was
not material.
In October 1995, the FASB issued SFAS No. 123, "Accounting for
Stock-Based Compensation", effective for transactions entered into in fiscal
years that begin after December 15, 1995. As permitted under the provisions of
SFAS 123, the Company continues to account for such compensation under rules
existing prior to SFAS 123. The Company will provide the required pro forma
disclosures in the 1996 Annual Report with respect to SFAS 123.
In June 1996, the FASB issued SFAS No. 125, "Accounting for Transfers
and Servicing of Financial Assets and Extinguishments of Liabilities", effective
for transactions entered into after December 31, 1996. This statement changes
the accounting treatment of future transactions which transfer financial assets
but retain the servicing rights, such as securitizations. The future effect on
the Company's financial position and the results of operations has not been
determined.
NOTE C PORTFOLIO QUALITY
The following table presents a breakdown (by line of business) of the
Company's investment in financing transactions before the reserve for possible
credit losses at the dates indicated.
4
<PAGE> 7
INVESTMENT IN FINANCING TRANSACTIONS
BY LINE OF BUSINESS
JUNE 30, 1996
(Dollars in Thousands)
<TABLE>
<CAPTION>
Revenue Accruing Nonaccruing
------------------------------- -------------------------------
Repos-
sessed Repos- Leases Total
Original Assets sessed & Carrying
Rate Impaired (1) Impaired Assets Other Amount
---------- -------- ------- -------- ------ -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Transportation Finance (2) $1,180,489 $ $ $ $ $ $1,180,489
Resort Finance 1,008,462 2,841 13,287 2,410 28,399 1,055,399
Commercial Real Estate Finance 677,501 12,321 43,641 2,609 16,736 988 753,796
Communications Finance 622,025 2,496 15,866 3,479 643,866
Corporate Finance (3) 619,453 3,523 15,543 335 638,854
Manufacturer & Dealer Services (3) 491,159 204 53,518 544,881
Medical Finance 513,488 859 514,347
Rediscount Finance 378,221 378,221
Franchise Finance 352,112 1,342 3,207 878 357,539
Commercial Equipment Finance 330,767 4,585 3,575 338,927
Factoring Services 226,897 3,482 230,379
Commercial Finance 207,073 10,009 217,082
Inventory Finance 202,188 415 202,603
Government Finance 130,855 3 130,858
Other 46,892 2,721 5,038 54,651
---------- ------- ------- ------- ------- ------- ----------
TOTAL (3) $6,987,582 $22,523 $56,928 $61,051 $48,949 $64,859 $7,241,892
========== ======= ======= ======= ======= ======= ==========
</TABLE>
- --------------------
(1) The Company earned income totaling $3.1 million on repossessed assets
during the six months ended June 30, 1996, including $2.7 million in
Commercial Real Estate and $0.4 million in Resort Finance.
(2) Transportation Finance includes $189.4 million of aircraft financing booked
through the London office.
(3) Excludes $353.3 million of assets securitized which the Company manages,
including $300 million in Corporate Finance and $53.3 million in
Manufacturer and Dealer Services.
--------------------
5
<PAGE> 8
RESERVE FOR POSSIBLE CREDIT LOSSES:
The reserve for possible credit losses of $148.7 million at June 30,
1996 represents 2.0% of managed assets (investment in financing transactions and
securitized assets) before deducting such reserve. Changes in the reserve for
possible credit losses were as follows:
<TABLE>
<CAPTION>
Six Months Ended
June 30,
-----------------------------
1996 1995
--------- ---------
(Dollars in Thousands)
<S> <C> <C>
Balance, beginning of period $ 140,333 $ 122,233
Provision for possible credit losses 24,750 18,000
Write-offs (20,024) (15,867)
Recoveries 1,534 1,289
Other 2,102 2,082
--------- ---------
Balance, end of period $ 148,695 $ 127,737
========= =========
</TABLE>
The Company believes that collateral values significantly reduce its
loss exposure and that the reserve for possible credit losses is adequate.
The specific impairment reserve of $10.6 million at June 30, 1996
applies to $30.3 million of the $83.6 million of impaired loans. The remaining
$138.1 million of the reserve for possible credit losses is designated for
general purposes and represents management's estimate of the amount to cover
potential losses in the portfolio considering delinquencies, loss experience and
collateral. Additions to general and specific reserves are reflected in current
operations. Management may transfer reserves between the general and specific
reserves as considered necessary.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
COMPARISON OF THE SIX MONTHS ENDED JUNE 30, 1996
TO THE SIX MONTHS ENDED JUNE 30, 1995
The following discussion relates to The FINOVA Group Inc. and its
subsidiaries (collectively, "FINOVA" or the "Company"), including FINOVA Capital
Corporation and its subsidiaries (collectively, "FINOVA Capital").
RESULTS OF OPERATIONS
Net income for the six months ended June 30, 1996 was $55.2 million
($1.98 per common share), compared to $46.0 million ($1.65 per common share) for
the first six months of 1995, a 20% increase in net income and earnings per
share.
INTEREST MARGINS EARNED. Interest margins earned, which represent the
difference between (a) interest and income earned from financing transactions
and operating lease income and (b) interest expense and depreciation, were
$190.9 million for the six months ended June 30, 1996, compared with $158.8
million during the same period in 1995, an increase of 20%. The increase was
primarily due to a 19% increase in average managed assets (investment in
financing transactions plus securitizations) during the respective periods,
while interest margins earned as a percentage of average earning assets remained
steady at 5.8%.
6
<PAGE> 9
NON-INTEREST EXPENSE. The provision for possible credit losses, which
increases the reserve for possible credit losses, increased to $24.8 million for
the first six months of 1996 from $18.0 million in 1995, primarily due to the
increase in managed assets. The reserve for possible credit losses as a
percentage of nonaccruing assets increased to 85.0% at June 30, 1996 from 77.8%
at June 30, 1995.
Selling, administrative and other operating expenses were higher during
the first six months of 1996 than in 1995, due primarily to the growth in
managed assets and incentives related to the Company's performance. As a
percentage of interest margins earned, these expenses decreased to 44.2% in the
first half of 1996, from 46.0% during the same period in 1995.
GAINS ON SALE OF ASSETS. Gains on sale of assets were slightly higher
in 1996 compared to 1995 primarily due to the amount and type of assets coming
off lease during the respective periods.
INCOME TAXES. Income taxes increased during the six months ended June
30, 1996, primarily due to the increase in pre-tax income, partially offset by a
lower effective tax rate. The lower effective tax rate, which decreased from
38.6% in 1995 to 38.1% in the first six months of 1996, was primarily related to
lower foreign tax effects and increased municipal income.
FINANCIAL CONDITION, LIQUIDITY, AND CAPITAL RESOURCES
Managed assets grew by $472.8 million during the first six months of
1996 and totaled $7.60 billion at June 30, 1996. The increase was attributable
to new business of $1.39 billion during the period, compared to $1.00 billion
for the six months ended June 30, 1995, partially offset by portfolio
amortization and higher than normal prepayment levels in certain lines of
business.
The reserve for possible credit losses increased from $140.3 million at
December 31, 1995 to $148.7 million at June 30, 1996, primarily due to the
increase in managed assets. Write-offs during the period were $20.0 million
compared to $15.9 million during 1995, while recoveries increased to $1.5
million for the first six months of 1996, from $1.3 million in 1995.
Non-accruing assets increased to $174.9 million at June 30, 1996, compared to
$167.9 million at the end of 1995; however, non-accruing assets as a percentage
of managed assets decreased to 2.3% from 2.4% at December 31, 1995.
The company had total debt of $5.97 billion at June 30, 1996 or 6.8
times its equity base of $871.7 million. This is comparable to year-end debt of
$5.65 billion, or 6.8 times the December 31, 1995 equity base of $825.2 million.
In 1993, FINOVA entered into interest rate hedge agreements on $750
million of floating-rate borrowings. During the six months ended June 30, 1996,
a portion of those agreements matured. The remainder will expire prior to the
end of the year.
Growth in funds employed is financed by the company's internally
generated funds and new borrowings. During the six months ended June 30, 1996,
FINOVA Capital issued $565.0 million in new long-term borrowings and recognized
a net increase in commercial paper borrowings of approximately $215 million.
Repayments of long-term debt totaled $524 million during the first six months of
1996.
RECENT DEVELOPMENTS AND BUSINESS OUTLOOK
The Company continues to seek new business by emphasizing customer
service, providing competitive interest rates and focusing on selected market
niches. Additionally, the Company continues to evaluate potential acquisition
opportunities that it believes are consistent with its business strategies. On
7
<PAGE> 10
May 9, 1996, the Company acquired LINC Financial Services, Inc. ("LINC"). The
transaction supplements the Company's Medical Finance business by adding
approximately $62 million in factored receivables, net of amounts due to
clients, as well as expertise in the financing of health care receivables. On
May 20, 1996, the Company announced that it had signed a definitive agreement to
acquire Financing for Science International, Inc. ("FSI"), a specialty leasing
company serving the high technology and life science industries in the United
States. The transaction is awaiting the approval of FSI's shareholders and is
expected to be consummated in the third quarter of 1996.
Subsequent to the end of the second quarter, Standard & Poor's Rating
Group raised FINOVA Capital's senior debt rate from BBB+ to A-.
NEW ACCOUNTING STANDARDS
See Note B of Notes to Interim Condensed Consolidated Financial
Information in Part I, Item 1 of this report.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS.
The Annual Meeting of Stockholders of the Company was held on May 9,
1996. At that meeting, stockholders owning 21,470,764 shares of the Company's
common stock ("Shares") were present in person or by proxy. The stockholders
approved each matter submitted by the following votes:
<TABLE>
Items For Against Abstain
----- --- ------- -------
<S> <C> <C> <C>
1.(a) Election of Mr. G. Robert Durham 21,263,758 N/A N/A
as a director
(b) Election of Mr. Kenneth R. Smith 21,264,927 N/A N/A
as a director
2. Amendment of the 1992 Stock 19,971,661 1,207,067 292,036
Incentive Plan
3. Apointment of Deloitte & Touche LLP 21,384,830 45,358 40,575
as auditors for 1996
* Abstain includes broker non-votes.
</TABLE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) The following exhibits are filed herewith:
Exhibit No. Document
----------- --------
11 Computation of Earnings Per Share.
12 Computation of Ratio of Income to Combined Fixed
Charges and Preferred Stock Dividends
(interim period).
27 Financial Data Schedule.
(b) Reports on Form 8-K:
A Report on Form 8-K, dated July 16, 1996, was filed by
Registrant which reported under Items 5 and 7 the revenues, net income and
selected financial data and ratios for the second quarter ended June 30, 1996
(unaudited).
8
<PAGE> 11
THE FINOVA GROUP INC.
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.
THE FINOVA GROUP INC.
(Registrant)
Dated: July 29, 1996 By: /s/ Bruno A. Marszowski
-------------------------------------
Bruno A. Marszowski, Senior Vice
President, Chief Financial Officer
and Controller
Principal Accounting Officer
9
<PAGE> 12
THE FINOVA GROUP INC.
COMMISSION FILE NUMBER 1-11011
EXHIBIT INDEX
JUNE 30, 1996 FORM 10-Q
Exhibit No. Document
- ----------- --------
11 Computation of Earnings Per Share.
12 Computation of Ratio of Income to Combined Fixed
Charges and Preferred Stock Dividends (interim period).
27 Financial Data Schedule.
10
<PAGE> 1
EXHIBIT 11
THE FINOVA GROUP INC.
Computation of Earnings Per Share
(Dollars in Thousands, except per share data)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
----------------------------- -----------------------------
1996 1995 1996 1995
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net income $ 28,121 $ 23,629 $ 55,242 $ 45,997
----------- ----------- ----------- -----------
Earnings available to
common shareholders $ 28,121 $ 23,629 $ 55,242 $ 45,997
=========== =========== =========== ===========
Average common shares
outstanding before
common equivalents 27,365,000 27,557,000 27,342,000 27,589,000
Common equivalent stock
options 596,000 319,000 600,000 296,000
----------- ----------- ----------- -----------
Average outstanding common
and equivalent shares 27,961,000 27,876,000 27,942,000 27,885,000
----------- ----------- ----------- -----------
Earnings per common
and equivalent share $ 1.01 $ 0.85 $ 1.98 $ 1.65
=========== =========== =========== ===========
</TABLE>
<PAGE> 1
EXHIBIT 12
THE FINOVA GROUP INC.
Computation of Ratio of Income to Combined Fixed Charges
and Preferred Stock Dividends
(Dollars in Thousands)
<TABLE>
<CAPTION>
Six Months Ended Year Ended
June 30, December 31,
------------------------------- ----------------------------------------------------
1996 1995 1995 1994 1993
------------ ------------- ------------ ------------- --------------
<S> <C> <C> <C> <C> <C>
Net income before income
taxes $ 89,300 $ 74,876 $ 157,240 $ 123,771 $ 66,422
Add fixed charges:
Interest expense 196,300 174,721 366,822 222,200 123,853
One-third rentals 1,217 1,147 2,478 2,041 1,387
------------ ------------- ------------ ------------- -------------
Total fixed charges 197,517 175,868 369,300 224,241 125,240
------------ ------------- ------------ ------------- -------------
Net income as adjusted $ 286,817 $ 250,744 $ 526,540 $ 348,012 $ 191,662
------------ ------------- ------------ ------------- -------------
Ratio of income to fixed
charges 1.45 1.43 1.43 1.55 1.53
============ ============= ============ ============= =============
Preferred stock dividends
on a pre-tax basis $ 0 $ 0 $ 0 $ 0 $ 2,139
Total combined fixed
charges and preferred
stock dividends $ 197,517 $ 175,868 $ 369,300 $ 224,241 $ 127,379
Ratio of income to combined ------------ ------------- ------------ ------------- -------------
fixed charges and preferred
stock dividends 1.45 1.43 1.43 1.55 1.50
============ ============= ============ ============= =============
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 23,252
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 7,241,892
<ALLOWANCE> 148,695
<TOTAL-ASSETS> 7,439,995
<DEPOSITS> 0
<SHORT-TERM> 0
<LIABILITIES-OTHER> 597,883
<LONG-TERM> 5,970,459
0
0
<COMMON> 284
<OTHER-SE> 871,369
<TOTAL-LIABILITIES-AND-EQUITY> 7,439,995
<INTEREST-LOAN> 419,108
<INTEREST-INVEST> 0
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 0
<INTEREST-DEPOSIT> 0
<INTEREST-EXPENSE> 196,300
<INTEREST-INCOME-NET> 190,905
<LOAN-LOSSES> 24,750
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 84,394
<INCOME-PRETAX> 89,300
<INCOME-PRE-EXTRAORDINARY> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 55,242
<EPS-PRIMARY> 1.98
<EPS-DILUTED> 0
<YIELD-ACTUAL> 5.8
<LOANS-NON> 174,859
<LOANS-PAST> 0
<LOANS-TROUBLED> 22,523
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 140,333
<CHARGE-OFFS> (20,024)
<RECOVERIES> 1,534
<ALLOWANCE-CLOSE> 148,695
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
