<PAGE>
UNITED STATES
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 March 31, 1997
--------------
OR
[x] 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 1-08916
-------
GREEN TREE FINANCIAL CORPORATION
------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 41-1807858
- ------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1100 LANDMARK TOWERS, SAINT PAUL, MINNESOTA 55102-1639
- -------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (612) 293-3400
--------------
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
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 April 30, 1997, 135,833,384 shares of common stock of Green Tree Financial
Corporation were outstanding.
<PAGE>
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 1997
INDEX
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION PAGE
<S> <C> <C>
Item 1. Financial Statements 3
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 9
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 14
Item 2. Changes in Securities 14
Item 3. Defaults Upon Senior Securities 14
Item 4. Submission of Matters to a Vote of
Security Holders 14
Item 5. Other Information 14
Item 6. Exhibits and Reports on Form 8-K 14
SIGNATURES 15
EXHIBIT INDEX 16
Exhibit 11. Computation of Per Share Amounts 17
Exhibit 12. Computation of Ratio of Earnings to
Fixed Charges 18
Exhibit 27. Financial Data Schedule 19
</TABLE>
Certain information included in this Form 10-Q may include "forward-looking"
information, as defined in the Private Securities Litigation Reform Act of 1995
(the "Act"). Such forward-looking information may involve risks or uncertainties
which are described in the Cautionary Statements contained in the Company's Form
8-K filed with the Securities and Exchange Commission on July 12, 1996.
Investors are specifically referred to the Cautionary Statements for a
discussion of factors which could affect the Company's operations and financial
performance. Factors referenced in the Cautionary Statements include: prevailing
economic conditions; ability to access capital resources; short-term interest
rate fluctuations; the level of defaults and prepayments on loans made by the
Company; competition; and regulatory changes. Any forward looking information is
based upon management's reasonable estimate of future results or trends. The
Company does not undertake, and the Act specifically relieves the Company from,
any obligation to update any forward-looking statements.
2
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, 1997 December 31, 1996
--------------- -----------------
(unaudited)
<S> <C> <C>
Assets:
Cash and cash equivalents $ 509,591,000 $ 442,071,000
Cash deposits, restricted 175,733,000 171,484,000
Other investments 15,764,000 11,925,000
Interest only securities 1,208,714,000 1,157,185,000
Receivables:
Lease 566,851,000 564,348,000
Commercial finance 269,757,000 212,920,000
Revolving credit 96,643,000 40,803,000
Other accounts receivable 97,777,000 85,503,000
Contracts and collateral 624,224,000 453,008,000
Servicing rights 42,801,000 --
Property, furniture and
fixtures 82,372,000 77,859,000
Goodwill 58,411,000 58,950,000
Other assets 18,710,000 21,988,000
-------------- --------------
Total assets $3,767,348,000 $3,298,044,000
============== ==============
Liabilities and Stockholders' Equity:
Notes payable $ 733,875,000 $ 472,181,000
Senior/Senior subordinated
notes 290,466,000 290,348,000
Accounts payable and
accrued liabilities 409,911,000 404,427,000
Investor payable 412,944,000 346,272,000
Income taxes, principally
deferred 587,567,000 539,362,000
-------------- --------------
Total liabilities 2,434,763,000 2,052,590,000
Common stock, $.01 par;
authorized 400,000,000
shares,issued 141,119,484
shares (1997) and
139,782,706 shares (1996) 1,411,000 1,398,000
Additional paid-in capital 425,334,000 373,573,000
Retained earnings 1,008,068,000 926,695,000
Net unrealized gain (loss)
on securities available
for sale (9,328,000) --
Minimum pension liability
adjustments (2,299,000) (2,299,000)
-------------- --------------
1,423,186,000 1,299,367,000
Less treasury stock,
3,068,700 shares (1997)
and 2,051,000 shares (1996)
at cost (90,601,000) (53,913,000)
-------------- --------------
Total stockholders'
equity 1,332,585,000 1,245,454,000
-------------- --------------
Total liabilities and
stockholders' equity $3,767,348,000 $3,298,044,000
============== ==============
</TABLE>
See notes to unaudited financial statements.
3
<PAGE>
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31
---------------------------
1997 1996
------------ -------------
<S> <C> <C>
Revenues:
Gain on contract sales $153,367,000 $ 97,487,000
Interest 75,429,000 45,182,000
Servicing 24,681,000 16,325,000
Commission and other 13,678,000 9,124,000
------------ ------------
267,155,000 168,118,000
Expenses:
Interest 29,818,000 11,364,000
Cost of servicing 19,379,000 12,162,000
General and administrative 69,889,000 37,556,000
------------ ------------
119,086,000 61,082,000
------------ ------------
Earnings before income taxes 148,069,000 107,036,000
Income taxes 56,266,000 40,674,000
------------ ------------
Net earnings $ 91,803,000 $ 66,362,000
============ ============
Earnings per common and
common equivalent share $ .65 $ .48
============ ============
Weighted average common and
common equivalent shares
outstanding 142,219,563 139,584,826
</TABLE>
See notes to unaudited financial statements.
4
<PAGE>
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31
---------------------------------
1997 1996
-------------- --------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Servicing fees and net interest
payments collected $ 69,373,000 $ 57,855,000
Net principal payments collected 64,067,000 44,594,000
Interest on contracts 27,848,000 12,129,000
Interest on cash, investments and
receivables 26,857,000 15,658,000
Commissions 11,501,000 8,659,000
Other (2,524,000) (944,000)
-------------- --------------
197,122,000 137,951,000
-------------- --------------
Cash paid to employees and suppliers (126,443,000) (78,601,000)
Interest paid on debt (20,251,000) (4,735,000)
Income taxes paid (7,430,000) (393,000)
-------------- --------------
(154,124,000) (83,729,000)
-------------- --------------
NET CASH PROVIDED BY OPERATIONS 42,998,000 54,222,000
Purchase of contracts and leases (2,087,204,000) (1,249,668,000)
Proceeds from sale of contracts 1,817,724,000 1,404,001,000
Principal collections on contracts
and leases 178,880,000 38,735,000
Commercial and revolving
credit loans disbursed (839,249,000) (530,717,000)
Principal collections on
commercial and revolving
credit loans 757,492,000 394,298,000
Net cash deposits (4,249,000) (2,025,000)
-------------- --------------
NET CASH (USED FOR) PROVIDED BY
OPERATING ACTIVITIES (133,608,000) 108,846,000
-------------- --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, furniture
and fixtures (10,084,000) (7,971,000)
Net purchases of investments (3,839,000) (220,000)
-------------- --------------
NET CASH USED FOR INVESTING ACTIVITIES (13,923,000) (8,191,000)
-------------- --------------
</TABLE>
5
<PAGE>
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(continued)
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31
--------------------------------
1997 1996
--------------- --------------
<S> <C> <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings on credit facilities 1,921,498,000 790,252,000
Repayments on credit facilities (1,659,804,000) (812,026,000)
Dividends paid (10,430,000) (8,542,000)
Common stock repurchased (36,688,000) --
Common stock issued 475,000 632,000
--------------- -------------
NET CASH PROVIDED BY (USED FOR)
FINANCING ACTIVITIES 215,051,000 (29,684,000)
--------------- -------------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 67,520,000 70,971,000
CASH AND CASH EQUIVALENTS BEGINNING
OF PERIOD 442,071,000 295,767,000
--------------- -------------
CASH AND CASH EQUIVALENTS END OF PERIOD $ 509,591,000 $ 366,738,000
=============== =============
RECONCILIATION OF NET EARNINGS
TO NET CASH (USED FOR) PROVIDED BY
OPERATING ACTIVITIES:
Net earnings $ 91,803,000 $ 66,362,000
Provision for income taxes 56,266,000 40,674,000
Depreciation and amortization 7,556,000 5,395,000
Net contract payments collected, less
interest only securities and
servicing rights recorded (50,189,000) (34,219,000)
Amortization of deferred servicing
revenue -- (4,708,000)
Amortization of servicing rights 2,569,000 --
Accretion of yield on interest
only securities (25,257,000) (16,610,000)
Net increase in cash deposits (4,249,000) (2,025,000)
Purchase of contracts and leases net
of sales and principal collections (99,237,000) 193,068,000
Commercial and revolving credit
loans disbursed, net of sales and
principal collections (81,757,000) (136,419,000)
Net selling expenses on
sale of contracts 10,897,000 10,410,000
Increase in interest payable 8,434,000 6,036,000
Income taxes paid (7,430,000) (393,000)
Increase in cash paid to employees
and suppliers (43,598,000) (36,682,000)
Other 584,000 17,957,000
--------------- -------------
NET CASH (USED FOR) PROVIDED BY
OPERATING ACTIVITIES $ (133,608,000) $ 108,846,000
=============== =============
</TABLE>
See notes to unaudited financial statements.
6
<PAGE>
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED FINANCIAL STATEMENTS
A. Basis of Presentation
The interim financial statements have been prepared by Green Tree Financial
Corporation ("the Company"), without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission applicable to quarterly
reports on Form 10-Q. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules and
regulations. In the opinion of management, all adjustments which are of a normal
recurring nature and are necessary for a fair presentation have been included.
However, results for interim periods are not necessarily indicative of the
results that may be expected for a full year. It is suggested that these
financial statements be read in conjunction with the consolidated financial
statements and related notes and schedules included in the Company's Annual
Report on Form 10-K for the year ended December 31, 1996.
Certain reclassifications have been made to the December 31, 1996 financial
statements to conform to the classifications used in the March 31, 1997
financial statements. These reclassifications had no effect on net earnings or
stockholders' equity as previously reported.
Effective January 1, 1997 the Company adopted Statement of Financial Accounting
Standards No. 125 ("SFAS 125"), Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities. The adoption of SFAS 125
did not have a material impact on the Company's financial position or results of
operations.
SFAS 125 requires prospective implementation as of January 1, 1997 and
retroactive application is not permitted. However, certain reclassifications
have been made to prior financial statements to conform to the current period
presentation. The previously classified excess servicing rights receivable has
been reclassified as interest only securities and is shown net of the Company's
previously classified allowance for losses on contracts sold. Effective January
1, 1997 the portion of the Company's interest only securities that exceeded
contractually specified servicing fees is classified as interest only securities
and the remaining asset is classified as servicing rights.
Among other provisions, SFAS 125 uses a "financial components" approach relative
to the recognition of financial assets and liabilities resulting from the
transfer of financial assets.
7
<PAGE>
Specifically, SFAS 125 requires that gain recognition on the sale of financial
assets be based on an allocated cost basis method for the financial components
sold. SFAS 125 also provides guidance relative to the classification and ongoing
measurement of the financial components retained in connection with financial
asset sales. Such components are recorded at allocated cost. The Company retains
interest only securities and servicing rights upon the sale of its financial
contracts.
The Company classifies its interest only securities as available for sale and
carries these securities at fair value. Accordingly, unrealized gains and losses
are reported on a net basis as a separate component of stockholders' equity.
Servicing rights are carried at allocated cost and amortized in proportion to
and over the estimated period of net servicing income. Servicing rights are
evaluated for impairment on an ongoing basis and, to the extent the recorded
amount exceeds the fair value of those servicing rights, a valuation allowance
is established through a charge to earnings. Upon subsequent measurement of the
fair value of these servicing rights in future periods, if the fair value equals
or exceeds the carrying amount, any previously recorded valuation allowance
would be deemed unnecessary and, therefore, represent current period earnings
only to the extent of such previously recorded allowance. No valuation allowance
was necessary at March 31, 1997.
B. Interest Only Securities
Interest only securities represent the right to receive certain cash flows which
exceed the amount of cash flows sold in the Company's securitized contract
sales. Interest only securities generally represent the value of excess interest
to be collected on the underlying financial contracts of each securitization
over the sum of the interest to be paid to security classes sold, contractual
servicing fees and credit losses.
These cash flows are projected and discounted over the expected life of the
financial contracts using prepayment, default, loss, and interest rate
assumptions that the Company believes market participants would use for similar
financial instruments.
In connection with the gain on sale of contracts and recording interest only
securities retained for the three-month period ended March 31, 1997 the Company
provided $75 million for projected credit losses on a discounted basis. For the
three-month period ended March 31, 1997 the Company incurred $49.5 million of
credit losses.
8
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Green Tree Financial Corporation ("Green Tree" or the "Company") is a
diversified financial services company that provides financing for
manufactured homes, home equity, home improvements, consumer products and
equipment and provides consumer and commercial revolving credit. The
Company's insurance agencies market physical damage and term mortgage life
insurance and other credit protection relating to the customers' contracts it
services.
Results of Operations:
The following table shows the percentage change in income, expenses and
earnings for the three-month period ended March 31, 1997 as compared to the
same period of 1996.
<TABLE>
<CAPTION>
Three-month
period-to-period
increase March 31,
1996 to 1997
------------
<S> <C>
Revenues:
Gain on contract sales 57.3%
Interest 66.9
Servicing 51.2
Commission and other 49.9
Expenses:
Interest 162.4
Cost of servicing 59.3
General and
administrative 86.1
Earnings before income
taxes 38.3
Net earnings 38.3
</TABLE>
Gain on contract sales increased 57.3% in the first quarter of 1997 over the
same period in 1996 as a result of overall increased dollar volume of
contracts sold and higher manufactured housing interest rate spreads and
points received. This increase in gain on contract sales was partially offset
by decreased interest rate spreads on the home equity/home improvement and
consumer/equipment contracts sold and a change in mix of contracts sold in the
first quarter of 1997 compared to the same period in 1996. For the quarter
ended March 31, 1997, total contract sales increased $406,059,000, or 28.7%.
9
<PAGE>
The following table sets forth the Company's fixed term contract originations
and sales for the three-month periods ended March 31, 1997 and 1996. Dollar
amounts are in thousands.
<TABLE>
<CAPTION>
Three-month
period ended
March 31,
1997 1996
---- ----
<S> <C> <C>
Originations:
Manufactured Housing $1,013,716 $ 898,035
Home Equity/Home Improvement 633,957 163,003
Consumer and Other 379,960 206,808
---------- ----------
Total $2,027,633 $1,267,846
========== ==========
Sales:
Manufactured Housing $1,050,000 $ 864,035
Home Equity/Home Improvement 520,099 118,857
Consumer and Other 249,999 431,147
---------- ----------
Total $1,820,098 $1,414,039
========== ==========
</TABLE>
The Company's market share of contracts for financing new manufactured homes
increased in the first quarter of 1997 compared to 1996. During this same
time period the manufactured housing market experienced a slight decrease in
new home shipments as compared to the prior year. The Company's dollar volume
of new manufactured housing contract originations rose 9.7% during the first
quarter of 1997 over the same period in 1996. The number of new contracts
originated by the Company during the first quarter of 1997 has grown from 1996
and the average contract size has also increased due to a shift in the
Company's manufactured home financing to more land-and-home contracts and
slight price increases by the manufactured housing manufacturers. The dollar
volume of previously owned manufactured housing contract originations rose
20.7%.
The dollar volume of home equity/home improvement contract originations rose
289% in the first quarter of 1997 over 1996 to $633,957,000. Consumer and
other contract originations rose 83.7% to $379,960,000 in the first quarter of
1997 over 1996. The overall growth in these originations resulted from
expanding the number of relationships with dealers and the growth in the
Company's home equity originations network.
Interest income is realized from interest only securities, commercial finance
and revolving credit receivables, cash deposits and short-term investments, as
well as contract and lease inventory. Interest income grew 66.9% during the
first quarter of 1997 compared to the same period in 1996 primarily from
increased earnings on the Company's commercial finance and lease receivables
and the increase in interest only securities. Due to higher production
levels, contract inventory for the three-months ended March 31, 1997 was
higher on average than the same period in 1996 which also contributed to the
increase in interest income.
10
<PAGE>
The increase in servicing income of 51.2% during the first quarter of 1997
compared to the first quarter of 1996 resulted from the 42.4% growth in the
Company's average servicing portfolio. The Company's servicing income as a
percentage of the serviced portfolio increased as a result of the product mix of
the portfolio changing to products with higher servicing fees.
Commissions and other income, which includes commissions earned on new insurance
policies written and renewals on existing policies, grew 49.9% during the first
quarter of 1997 compared to the same period in 1996. This growth is primarily a
result of the increase in net written insurance premiums as the Company's
contract originations and servicing portfolio continue to grow.
Interest expense increased 162.4% during the first quarter of 1997 as a result
of higher interest rates and the Company maintaining a higher level of
borrowings to fund its loan originations and commercial finance and lease
portfolios during the first quarter of 1997 compared to 1996.
Green Tree's dollar amount of cost of servicing increased 59.3% during the first
quarter of 1997 compared to the same period in 1996 as the Company's total
average servicing portfolio grew 42.4%. The Company's cost of servicing as a
percentage of the serviced portfolio increased as a result of the product mix
change in the portfolio towards products which require more servicing resources.
General and administrative expenses rose 86.1% in the first quarter of 1997. As
a percentage of contract originations, these expenses have remained relatively
constant with the first quarter of 1996. The dollar growth is due primarily to
an increase in personnel and other costs related to the expansion of the
Company's new divisions as well as the increased volume of contracts the Company
originated during the quarter.
Capital Resources and Liquidity:
The Company's business requires continued access to the capital markets for the
purchase, warehousing and sale of contracts. To satisfy these needs, the Company
employs a variety of capital resources.
Historically, the most important liquidity source for the Company has been its
ability to sell contracts in the secondary markets through loan securitizations.
During the first quarter of 1997 the Company completed four securitizations, two
backed by manufactured housing loans, one by home equity and home improvement
loans and one by consumer product and equipment finance loans. Each securitized
sale employed a senior/subordinate structure with a portion of the subordinate
bonds enhanced by a corporate guarantee.
11
<PAGE>
Servicing fees and net interest payments collected, which has been the Company's
principal source of cash, increased during the three-month period ended March
31, 1997 compared to the same period in 1996. Contributing to this growth is an
increase in servicing revenue collected by the Company on its growing servicing
portfolio, and growth in the interest only securities from the Company's ongoing
securitizations.
Net principal payments collected were positive for the quarters ended March 31,
1997 and 1996 as a result of an increase in the contract principal payments
collected by the Company as of the end of each period but not yet remitted to
the investors/owners of the contracts. These increases are a result of customer
payoffs and the growth of the Company's servicing portfolio of contracts which
have been sold.
Interest on contracts increased significantly during the first quarter of 1997
compared to the same period in 1996 as a result of the Company having a larger
average outstanding contract portfolio.
Interest on cash, investments and receivables increased during the first quarter
of 1997 compared to the same period in 1996 primarily as a result of the
increase in lease and revolving credit receivables.
Cash paid to employees and suppliers increased $41,995,000 in the first quarter
of 1997 compared to the same period in 1996. This growth relates primarily to
the increase in the Company's portion of taxes paid in 1997 on the annual bonus
of the chief executive officer pursuant to the terms of an employment agreement,
as well as the growth in the Company's total general and administrative expenses
and servicing costs.
Dividends paid by the Company increased 22.1% in the first quarter of 1997
compared to the same period in 1996 as the Company's quarterly dividend rate
increased 20% over the first quarter 1996 quarterly dividend rate.
The Company has a $1,000,000,000 commercial paper program which is used
primarily for purposes of financing its contract inventory prior to sale of
those receivables in the form of securitization. This program is backed by both
committed bank facilities and master repurchase agreements with various
investment banking firms. As of March 31, 1997 the Company had issued and
outstanding $370,080,000 in notes under this program.
The Company has a three-year unsecured revolving line of credit totaling
$500,000,000 which expires April 15, 1999. As of March 31, 1997 it had
borrowings totaling $372,000,000 outstanding under this facility. In addition,
master repurchase agreements are in place with a variety of investment banking
firms totaling $2,300,000,000 which are subject to the availability of eligible
12
<PAGE>
collateral. There were no outstanding balances under these facilities as of
March 31, 1997.
On April 29, 1997 the Company closed two new unsecured revolving lines of
credit, a $750,000,000 364-day facility and a $750,000,000 3-year facility,
replacing the $500,000,000 facility referred to above. These combined facilities
totaling $1,500,000,000 are available for general corporate purposes and will
allow the Company to increase the size of its commercial paper program for
purposes of funding its growing levels of loan production.
13
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
The nature of the Company's business is such that it is routinely a
party or subject to items of pending or threatened litigation.
Although the ultimate outcome of certain of these matters cannot be
predicted, management believes, based upon information currently
available and the advice of counsel, that the resolution of these
routine legal matters will not result in any material adverse
effect on its consolidated financial condition.
Item 2. Changes in Securities
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Other Information
None.
Item 6. (a) Exhibits
11. Computation of Per Share Amounts.
12. Computation of Ratio of Earnings to Fixed
Charges.
27. Financial Data Schedule.
(b) Reports on Form 8-K
None.
14
<PAGE>
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 hereunto duly authorized.
GREEN TREE FINANCIAL CORPORATION
DATE: May 15, 1997 /s/Edward L. Finn
------------------------------
Edward L. Finn
Executive Vice President and
Chief Financial Officer
DATE: May 15, 1997 /s/Joel H. Gottesman
------------------------------
Joel H. Gottesman
Senior Vice President and
General Counsel
15
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Exhibit Page
- ------- ------- ----
<S> <C> <C>
11. Computation of Per Share Amounts. 17
12. Computation of Ratio of Earnings to Fixed Charges. 18
27. Financial Data Schedule. 19
</TABLE>
16
<PAGE>
Exhibit 11.
-----------
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
COMPUTATION OF PER SHARE AMOUNTS
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31
---------------------------
1997 1996
------------- ------------
<S> <C> <C>
Primary:
Net earnings $ 91,803,000 $ 66,362,000
============ ============
Weighted average number of
common and common equivalent
shares outstanding:
Weighted average common
shares outstanding 138,511,310 136,224,524
Dilutive effect of stock
options after application
of treasury-stock method 3,708,253 3,360,302
------------ ------------
142,219,563 139,584,826
============ ============
Earnings per share $ .65 $ .48
============ ============
</TABLE>
<TABLE>
<CAPTION>
Fully Diluted:
<S> <C> <C>
Net earnings $ 91,803,000 $ 66,362,000
============ ============
Weighted average number of
common and common equivalent
shares outstanding:
Weighted average common
shares outstanding 138,511,310 136,224,524
Dilutive effect of stock
options after application
of treasury-stock method 3,708,253 3,710,093
------------ ------------
142,219,563 139,934,617
============ ============
Earnings per share $ .65 $ .47
============ ============
</TABLE>
17
<PAGE>
Exhibit 12.
-----------
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
-------------------------------------------------
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
-------------------------------------------------
<TABLE>
<CAPTION>
Three months
ended
March 31, 1997
--------------
(unaudited)
<S> <C>
Earnings:
Earnings before income taxes $148,069,000
Fixed charges:
Interest 29,818,000
One-third rent 949,000
------------
30,767,000
------------
$178,836,000
============
Fixed charges:
Interest $ 29,818,000
One-third rent 949,000
------------
$ 30,767,000
============
Ratio of earnings to fixed charges (1) 5.81
============
</TABLE>
(1) For purposes of computing the ratio, earnings consist of earnings before
income taxes plus fixed charges.
18
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND> This schedule contains summary financial information extracted from
the financial statements of Green Tree Financial Corporation and Subsidiaries
for the three-month period ended March 31, 1997 and is qualified in its entirety
by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-1-1997
<PERIOD-END> MAR-31-1997
<CASH> 685,324,000
<SECURITIES> 1,230,053,000
<RECEIVABLES> 1,048,355,000
<ALLOWANCES> 17,327,000
<INVENTORY> 624,224,000
<CURRENT-ASSETS> 0
<PP&E> 123,863,000
<DEPRECIATION> 41,491,000
<TOTAL-ASSETS> 3,772,923,000
<CURRENT-LIABILITIES> 0
<BONDS> 290,466,000
0
0
<COMMON> 1,411,000
<OTHER-SE> 1,331,474,000
<TOTAL-LIABILITY-AND-EQUITY> 3,772,923,000
<SALES> 153,367,000
<TOTAL-REVENUES> 267,155,000
<CGS> 0
<TOTAL-COSTS> 89,268,000
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 29,818,000
<INCOME-PRETAX> 148,069,000
<INCOME-TAX> 56,266,000
<INCOME-CONTINUING> 91,803,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 91,803,000
<EPS-PRIMARY> .65
<EPS-DILUTED> .65
</TABLE>
