SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
-------------------------------------
FORM 10-Q/A
[X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1999
0R
[ ] 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 33-93312
BEAL FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
TEXAS 75-2583551
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
Suite 300, Lb66, 15770 North Dallas Parkway, Dallas, Texas 75248
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (972) 404-4000
--------------
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 May 14, 1999, there were 300,000 shares of the Registrant's common
stock issued and outstanding.
<PAGE>
BEAL FINANCIAL CORPORATION
INDEX
Page
Number
Part I. Financial Information
Item 1. - Financial Statements................................. 1
Item 2. - Management's Discussion and Analysis of
Financial Condition and Results of Operations....... 5
Item 3. - Quantitative and Qualitative Disclosures
About Market Risk................................... 11
PART II. Other Information.............................................. 11
Signatures..................................................... 12
<PAGE>
BEAL FINANCIAL CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands,except share data)
March 31, December 31,
1999 1998
------------- ------------
ASSETS
Cash ....................................... $ 730 $ 5,540
Interest bearing deposits .................. 68,123 66,599
----------- -----------
Cash and cash equivalents ................ 68,853 72,139
Accrued interest receivable ................ 13,846 12,983
Securities available for sale .............. 83,664 89,581
Net loans receivable ....................... 1,121,028 1,059,413
Less allowance for losses .............. (13,984) (13,867)
----------- -----------
1,107,044 1,045,546
Federal Home Loan Bank stock ............... 10,334 9,877
Real estate held for investment or sale .... 104,188 106,353
Premises and equipment, net ................ 5,694 5,699
Other assets ............................... 11,788 11,296
----------- -----------
Total Assets ............................. $ 1,405,411 $ 1,353,474
=========== ===========
LIABILITIES
Deposit accounts ........................... $ 971,594 $ 1,005,617
Federal Home Loan Bank advances ............ 204,000 80,000
Senior notes, net .......................... 57,324 57,295
Other borrowings ........................... 6,966 7,083
Other liabilities .......................... 12,418 12,253
----------- -----------
Total Liabilities ........................ 1,252,302 1,162,248
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Common stock, par value $1 per share
authorized 375,000
issued and outstanding 300,000 ........ 300 300
Paid-in capital ............................ 2,740 2,740
Accumulated other comprehensive
income ................................ 3,191 3,909
Retained earnings .......................... 206,878 184,277
----------- -----------
213,109 191,226
Stockholder note receivable ................ (60,000) --
----------- -----------
Total Stockholders' Equity ............... 153,109 191,226
----------- -----------
Total Liabilities and Stockholders'
Equity.................................. $ 1,405,411 $ 1,353,474
=========== ===========
See Notes to Consolidated Financial Statements.
1
<PAGE>
BEAL FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands)
Three Months Ended
March 31,
---------------------
1999 1998
--------- --------
Interest income:
Loans, including fees .................. $29,946 $24,410
Purchased discount accretion ........... 9,673 11,907
Investment securities .................. 2,622 2,511
------- -------
Total interest income ............. 42,241 38,828
Interest expense:
Deposits ............................... 12,529 13,088
Federal Home Loan Bank
advances and other borrowings ..... 1,290 412
Senior notes ........................... 2,035 2,011
------- -------
Total interest expense ............ 15,854 15,511
------- -------
Net interest income .............. 26,387 23,317
------- -------
Provision for loan losses .................... 1,173 1,373
------- -------
Net interest income after
provision for loan losses ...... 25,214 21,944
------- -------
Other income
Gain on sale of loans .................. 0 5
Gain on real estate transactions ....... 1,110 3,014
Other real estate operations, net ...... 1,323 1,485
Other operating income ................. 1,281 137
------- -------
Total noninterest Income .......... 3,714 4,641
Other expense
Salaries and employee benefits ......... 1,930 1,695
Occupancy and equipment ................ 526 647
SAIF deposit insurance premium ......... 155 158
Other operating expenses ............... 2,122 2,210
------- -------
Total noninterest expenses ........ 4,733 4,710
------- -------
Income before income taxes ........ 24,195 21,875
Income Taxes ........................... 1,594 1,028
------- -------
Net Income ...................... $22,601 $20,847
======= =======
Income per common share ................ $ 75.34 $ 69.49
Weighted average number of common shares
outstanding ...................... 300 300
See Notes to Consolidated Financial Statements.
2
<PAGE>
BEAL FINANCIAL CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
UNAUDITED
(In thousands)
<TABLE>
Three Months
ended March 31
------------------------
1999 1998
----------- ----------
<S> <C> <C>
Operating activities
Net income $ 22,601 $ 20,847
Adjustments to reconcile net income
to net cash provided by operating
activities
Depreciation and amortization 487 599
Accretion of purchased discount (9,673) (11,907)
Provision for loan losses 1,173 1,373
Amortization of bond premium and underwriting costs 202 179
Gains on real estate transactions (1,110) (3,014)
Gain on sales of loans -- (5)
Loss on sale of premises and equipment -- 1
Changes in operating assets and liabilities
Accrued interest receivable (864) (130)
Prepaid expenses and other assets (1,827) (1,865)
Accrued interest payable-bonds (1,833) (1,833)
Other liabilities and accrued expenses 2,138 321
--------- ---------
Net cash provided by operating activities 11,294 4,566
Investing activities
Proceeds from sales of loans -- 5
Proceeds from paydowns of securities available for sale 5,326 4,352
Proceeds from loan collections, less loan originations and advances 69,799 53,775
Proceeds from sales of real estate and partnership/JV interests 5,037 13,658
Purchases of loans and bid deposits on loan purchases (123,211) (68)
Purchases of Federal Home Loan Bank stock (457) (151)
Purchases of real estate held for invest or sale and partnership/JV interests (709) (933)
Purchases of premises and equipment (225) (40)
--------- ---------
Net cash provided by (used in) investing activities (44,440) 70,598
Financing activities
Net decrease in deposit accounts (34,023) (96,327)
Repayments of long-term debt (117) (363)
Proceeds from (repayments of) advances from the Federal Home Loan Bank 124,000 (34,000)
Loan to shareholder (60,000) --
Cash dividends paid -- (12,600)
--------- ---------
Net cash provided by(used in) financing activities 29,860 (143,290)
--------- ---------
Net decrease in cash and cash equivalents (3,286) (68,126)
Cash and cash equivalents at beginning of period 72,139 150,849
--------- ---------
Cash and cash equivalents at end of period $ 68,853 $ 82,723
========= =========
Supplemental disclosure of cash flow information
Cash paid during the period for
Interest $ 15,613 $ 17,992
Income taxes 1,063 1,982
Supplemental disclosure of noncash investing and financing activities
Real estate acquired in foreclosure or in settlement of loans $ 3,992 $ 3,333
</TABLE>
See Notes to Consolidated Financial Statements.
3
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE A--NEW ACCOUNTING PRONOUNCEMENT
In 1998, Beal Financial Corporation ("Beal Financial" and with its
subsidiaries, the "Company") adopted Statement of Financial Accounting Standards
No. 130, "Reporting Comprehensive Income", which requires reporting of
comprehensive income in the financial statements. The components of
comprehensive income are as follows:
Three months ended
March 31,
----------------------
1999 1998
---------- ---------
(In thousands)
Net income ........................... $ 22,601 $ 20,847
Other comprehensive income net
unrealized losses on investment
securities - available for sale.... (718) (32)
-------- --------
Comprehensive income ................. $ 21,883 $ 20,815
======== ========
NOTE B--LOAN TO SHAREHOLDER
In January, 1999, Beal Financial funded a $60,000,000 loan to the majority
shareholder. As of March 31, 1999, interest in the amount of $1,242,500 has been
earned and received on this loan. The aforementioned loan and interest amounts
were not used in the calculation of operating ratios.
NOTE C--INCOME TAXES
On March 15, 1999, Beal Financial filed an application with the Internal
Revenue Service to elect Subchapter S status for federal income tax purposes
effective January 1, 1999, for its subsidiaries, Beal Affordable Housing, Inc.,
BRE-1 Inc., and BRE-N, Inc. Beal Financial and its remaining subsidiaries have
been Subchapter S corporations since January 1, 1997.
Beal Financial and all of its subsidiaries no longer pay federal income
taxes, except for federal taxes related to the recognition of built-in gains
which existed at January 1, 1997, (January 1, 1999, for the above named
subsidiaries.) For the three months ended March 31, 1999, the Company recorded
federal tax expense of $1,434,581, related to the recognition of built-in gains.
Except as discussed above, the liability for federal income taxes of the Company
is the responsibility of its shareholders.
4
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
When used in this Form 10-Q, the words "believes", "anticipates",
"expects", and similar expressions are intended to identify forward looking
statements. Such statements are subject to certain risks and uncertainties which
could cause actual results to differ materially. Readers are cautioned not to
place undue reliance on these forward looking statements which speak only as of
the date hereof, and to advise readers that various factors including regional
and national economic conditions, changes in domestic or foreign markets,
financial or legal conditions, changes in levels of market interest rates,
credit risks of lending activities, and competitive and regulatory factors,
could affect the Company's financial performance and could cause the Company's
actual results for future periods to differ materially from those anticipated or
projected. The Company undertakes no obligation to publicly release the results
of any revisions to forward looking statements which may be made to reflect
events or circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
Financial Condition
Beal Financial Corporation ("Beal Financial" and with its subsidiaries, the
"Company"), the parent company of Beal Bank, ssb, (the "Bank") had total assets
of $1.4 billion at March 31, 1999 representing an increase of $51.9 million or
3.84%, from $1.4 billion at December 31, 1998. The increase resulted primarily
from an increase in net loans receivable of $61.6 million. The increase in net
loans receivable was due to a bulk loan purchase totaling $121.9 million, gross,
of primarily performing, well seasoned, single family residential loans in the
first quarter of 1999. An increase in Federal Home Loan Bank ("FHLB") borrowings
coupled with loan proceeds and cash and cash equivalents were utilized to fund
this loan purchase. (See also - Liquidity and Capital Resources)
Total liabilities increased $90.1 million, or 7.75% from $1.2 billion at
December 31, 1998 to $1.3 billion at March 31, 1999, primarily due to an
increase in FHLB advances of $124.0 million. This increase helped fund the bulk
loan purchase mentioned above and a decrease in deposits of $34.0 million. (See
also - Liquidity and Capital Resources).
Stockholders' equity decreased $38.1 million from $191.2 million at
December 31, 1998 to $153.1 million at March 31, 1999. This decrease was due
primarily to the accounting treatment of a $60.0 million loan made to the
Company's primary shareholder. This loan is shown as a Note Receivable and a
deduction to capital. This decrease was partially offset by net income of $22.6
million for the quarter.
Results of Operations for the Three Months Ended March 31, 1999 and 1998
Net Income. For the three months ended March 31, 1999, net income of $22.6
million represented an increase of $1.8 million, or 8.41% from the three months
ended March 31, 1998. As discussed in more detail below, the increase was
5
<PAGE>
primarily due to an increase in net interest income after provision for loan
losses of $3.3 million, partially offset by a decrease in noninterest income of
$927,000, and an increase in income taxes of $566,000.
Interest Income. Interest income increased $3.4 million, or 8.79%, from
$38.8 million at March 31, 1998 to $42.2 million at March 31, 1999. Of the total
increase in interest income, $5.5 million was due to an increase in interest
income on loans, including fees, partially offset by a decrease in purchase
discount accretion of $2.2 million. The average balance of interest-earning
assets increased $189.6 million during this period, as compared to the same
period a year ago, primarily due to an increase in average net loans receivable
of $163.8 million. In addition, net interest spread decreased from 9.18% for the
three months ended March 31, 1998 to 7.98% for the same period ending March 31,
1999, primarily due to a decrease in yield on average interest-earning assets
from 9.04% to 8.24% for the three month periods ending March 31, 1998 and March
31, 1999, respectively, due primarily to a decline in the amount of purchase
discount accretion taken. (See Note B --Loan to Shareholders).
Interest Expense. Interest expense increased $343,000 or 2.21%, from $15.5
million at March 31, 1998 to $15.9 million at March 31, 1999. Even though the
average balance of interest-bearing liabilities increased $108.2 million to $1.2
billion at March 31, 1999, the average rate of interest bearing liabilities
decreased from 5.88% at March 31, 1998 to 5.45% at March 31, 1999, resulting in
the slight increase in interest expense. The increase in average
interest-bearing liabilities was due to an increase in the average balance of
deposits of $32.7 million and an increase in the average balance of FHLB
advances of $75.9 million.
Provision for Loan Loss Expense is Determined by Management. The provision
for loan losses is determined by management as an amount sufficient to maintain
the allowance for loan losses at a level considered adequate to absorb future
losses inherent in the loan portfolio in accordance with generally accepted
accounting principles. The provision for loan loss expenses decreased $200,000,
to $1.2 million, for the three months ended March 31, 1999, as compared to the
three months ended March 31, 1998 primarily as a result of the decreased level
of non-performing loans.
The Company establishes an allowance for loan losses based upon a
systematic analysis of risk factors in the loan portfolio as well as a specific
analysis of certain impaired loans. This analysis includes an evaluation of the
Company's loan portfolio, past loan loss experience, current economic
conditions, loan volume and growth, composition of the loan portfolio and other
relevant factors. Management's analysis results in the establishment of
allowance amounts by loan type based on allocations by asset classification. The
allowance for loan losses as a percentage of net non-performing loans was 12.26%
at March 31, 1999 as compared to 8.53% at March 31, 1998. Net non-performing
loans decreased $19.2 million from $133.3 million at March 31, 1998 to $114.1
million at March 31, 1999.
Although management believes that it uses the best information available to
determine the allowance, unforeseen market conditions could result in
adjustments and net earnings could be significantly affected if circumstances
differ substantially from the assumptions used in making the final
determination. Future additions to the Company's allowance will be the result of
periodic loan, property and collateral reviews and thus cannot be predicted with
absolute certainty in advance. In addition, regulatory agencies, as an integral
part of the examination process, periodically review the Company's allowance for
6
<PAGE>
loan losses. Such agencies may require the Company to recognize additions to the
allowance level based upon their judgment of the information available to them
at the time of their examination.
Non-interest Income. Total non-interest income decreased $927,000, or
19.97% to $3.7 million at March 31, 1999 from $4.6 million at March 31, 1998.
This decrease was due to an decrease in the income attributable to the gain on
real estate transactions of $1.9 million, a decrease in the income from other
real estate operations of $162,000, partially offset by an increase in other
operating income of $1.1 million.
Non-interest Expense. Non-interest expense remained virtually unchanged at
$4.7 million, increasing a mere $23,000 for the three months ended March 31,
1999 as compared to the three months ended March 31, 1998. Salaries and employee
benefits increased $235,000, partially offset by a decrease in occupancy and
equipment expense of $121,000 and a decrease in other operating expenses of
$88,000.
Federal and State Taxation
On March 15, 1999, the Company filed an application with the Internal
Revenue Service to elect Subchapter S status for federal income tax purposes
effective January 1, 1999. This election covered Beal Affordable Housing, Inc.,
BRE-1 and BRE-N, Inc. The Company's remaining subsidiaries have been Subchapter
S corporations since January 1, 1997. (See also - Note C--Income Taxes).
The future tax liability for the taxable earnings of Beal Financial and all
of its subsidiaries electing Subchapter S status will be the responsibility of
the shareholders of Beal Financial. It is anticipated that future dividends to
shareholders will be declared equal to at least their tax liability related to
the earnings of Beal Financial.
Liquidity and Capital Resources
The Company's primary sources of funds for operations are deposits obtained
from its market area, principal and interest payments on loans, brokered
deposits, and advances from the FHLB of Dallas and to a lesser extent, from the
sale of assets. While maturities and scheduled amortization of loans are
predictable sources of funds, deposit flows and mortgage prepayments are greatly
influenced by general interest rates, economic conditions, and competition.
Historically, the primary investing activity of the Company has been the
purchase of discounted loans from various U.S. government agencies through the
sealed bid process or auctions and other private sector sellers. During the
three month periods ended March 31, 1999, and March 31, 1998 the Company
purchased $123.2 million and $0 million of net loans, respectively. Loan
origination's and disbursements of loans in process for the three months ended
March 31, 1999 and March 31, 1998 totaled $21.8 million and $7.8 million,
respectively.
The Company's primary financing activity has historically been the
attraction of deposits. During the three months ended March 31, 1999, the
Company experienced a net decrease in deposits of $34.0 million, primarily due
to a $54.8 million decrease in retail deposits offset by an increase of $20.8
million in brokered deposits. The decrease in deposits for the three months
7
<PAGE>
ended March 31, 1999 was primarily funded with an increase in FHLB advances of
$124.0 million and cash flow provided from normal operations. By utilizing FHLB
advances and brokered deposits the Bank was able to lower its overall cost of
interest-bearing liabilities. The Company had Senior Notes, net, of $57.3
million and other borrowings of $7.0 million at March 31, 1999.
The Company has the ability to borrow additional funds from the FHLB of
Dallas by pledging assets as collateral, subject to certain restrictions. At
March 31, 1999, the Company had an undrawn advance arrangement with the FHLB for
$54.8 million.
The Bank is required to maintain minimum levels of liquid assets as defined
by the Texas Savings and Loan Department ("Texas Department"). Unless approved
in advance by the Texas Department, a Texas savings bank is required to maintain
a minimum of 10% of the previous quarters average deposits in liquid assets. At
March 31, 1999, the Bank's liquidity ratio was 14.53%.
The Company's most liquid asset is cash and cash equivalents. The level of
cash equivalents is dependent on the Company's operating, financing, and
investing activities during any given period. At March 31, 1999, the Company had
cash and cash equivalents of $68.9 million.
The Company anticipates that it will have sufficient funds available to
meet its current foreseeable commitments. At March 31, 1999, the Company had
commitments to originate loans of $40.9 million and no outstanding commitments
to purchase loans. Certificates of deposits which are scheduled to mature in one
year or less at March 31, 1999 totaled $737.9 million. Due to the Company's high
interest rate spread, management has typically relied upon interest rate
sensitive short-term deposits to fund its loan purchases. The Company believes
the potential interest rate risk is acceptable in view of the Company's belief
that it can maintain an acceptable net interest spread.
At March 31, 1999, the Bank exceeded each of its three capital
requirements. The following is a summary of the Bank's regulatory capital
position at March 31, 1999.
At March 31, 1999
------------------------------------
Required Actual
----------------- -----------------
Amount Percent Amount Percent
-------- ------- -------- -------
(Dollars in Thousands)
Leverage capital ............. $69,797 5.00% $184,237 13.20%
Tier 1 capital ............... 60,420 6.00 184,237 18.30
Total risk-based capital ..... 100,700 10.00 196,842 19.55
The Board of Directors of the Bank declared a dividend of $7.0 million on
April 6, 1999, which was paid on April 12, 1999. The effect of this dividend is
not included in the above schedule.
8
<PAGE>
Impact of Inflation and Changing Prices
The Consolidated Financial Statements and Notes thereto presented herein
have been prepared in accordance with generally accepted accounting principles,
which require the measurement of financial position and operating results in
terms of historical dollars without considering the change in the relative
purchasing power of money over time due to inflation. The impact of inflation is
reflected in the increased cost of the Company's operations. Nearly all the
assets and liabilities of the Company are financial, unlike most industrial
companies. As a result, the Company's performance is directly impacted by
changes in interest rates, which are indirectly influenced by inflationary
expectations. Since the Company has historically placed more emphasis on
increasing net interest margin rather than on matching the maturities of
interest rate sensitive assets and liabilities, changes in interest rates may
have a greater impact on the Company's financial condition and results of
operations. Changes in investment rates do not necessarily move to the same
extent as changes in the price of goods and services.
Ratios of Earning to Fixed Charges
The Company's consolidated ratios of earnings to fixed charges for the
three months ended March 31, 1999 are set forth below. Earnings used in
computing the ratios shown, consist of earnings from continuing operations
before taxes and interest expense. Fixed charges, excluding interest on
deposits, represent interest expense on borrowings. Fixed charges, including
interest on deposits, represent all of the foregoing items plus interest on
deposits. Interest expense (other than on deposits) includes interest on FHLB of
Dallas borrowings, the Senior Notes and other borrowed funds.
For the Three Months Ended
March 31, 1999
---------------------------
Excluding interest on deposits . . . . . 8.3:1
Including interest on deposits . . . . . 1.7:1
Year 2000
The Year 2000 issue is the result of computer programs being written using
two digits rather than four to define the applicable year. Any of the computer
programs used by the Company that have time-sensitive software may recognize a
date using "00" as the year 1900 rather than the year 2000. This could result in
system failure or miscalculations. Management anticipates that the enhancements
necessary to prepare its systems for the year 2000 will be completed in a timely
manner.
9
<PAGE>
The Company's Year 2000 project team ensures that all Company systems are
identified, analyzed for Year 2000 compliance, and corrected, if necessary by
September 30, 1999. The Year 2000 project team members represent all functional
areas of the company. The Company's Board of Directors oversees the year 2000
plan and provides guidance and resources to, and receives monthly updates from
the Year 2000 coordinator.
The Company is expensing the cost of all required system changes and such
costs are funded through operating cash flows. The total estimated cost of the
Year 2000 conversion project is approximately $150,000. The Company does not
expect significant increases in future data processing costs relating to Year
2000 compliance.
The Company is in the process of developing contingency plans. These plans
will be completed by June 30, 1999 and tested in compliance with the Interagency
Regulatory Guidelines. The Company's core banking system is used by a number of
other financial institutions and has informed the Company that they are Year
2000 compliant. The Company has satisfactorily tested the system.
10
<PAGE>
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Market Risk
The Company's estimated sensitivity to interest rate risk, as measured by
the estimated interest earnings sensitivity profile and the interest sensitivity
gap analysis, has not changed materially from the information disclosed in the
Company's Form-10K for the period ended December 31, 1998.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
The Company is not currently involved in any material legal proceedings.
The Bank is involved in various legal proceedings occurring in the ordinary
course of business. Management of the Bank, based on discussions with litigation
counsel, believes that such proceedings will not have a material adverse effect
on the financial condition or operations of the Bank. There can be no assurance,
however, that any of the outstanding legal proceedings to which the Bank is a
party will not be decided adversely to the Company's interests and have a
material adverse effect on the financial position or results of operations of
the Company.
Item 2. Changes in Securities
None.
Items 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. Exhibits and Reports On Form 8-K
The following exhibit is filed herewith:
(a) Exhibit 27--Financial Data Schedule
(b) Reports on Form 8-K.
During the quarter ended March 31, 1999, the Company filed a Current Report
on Form 8-K dated March 11, 1999 to report under Item 5 of Form 8-K the
Company's earnings for the quarter ended December 31, 1998.
During the quarter ended March 31, 1999, the Company filed a Current Report
on Form 8-K dated January 29, 1999 to report under Item 5 of Form 8-K a $60.0
million loan to its primary stockholder, D. Andrew Beal.
11
<PAGE>
Pursuant to the requirement 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.
BEAL FINANCIAL CORPORATION
Registrant
Date: May 18, 1999 /S/ D. ANDREW BEAL
--------------------------------------
D. Andrew Beal, Chairman and
President
(Duly Authorized Representative)
Date: May 18, 1999 /S/ JAMES W. LEWIS, JR.
--------------------------------------
James W. Lewis, Jr., Chief Accounting
Officer
(Principal Financial Officer)
12
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
The financial data schedule contains financial information from the Company's
interim consolidated financial statements contained in its quarterly report on
Form 10-Q for the period ended March 31, 1999 and is qualified in its entirety
by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 730
<INT-BEARING-DEPOSITS> 68,123
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 83,664
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 1,121,028
<ALLOWANCE> 13,984
<TOTAL-ASSETS> 1,405,411
<DEPOSITS> 971,594
<SHORT-TERM> 204,000
<LIABILITIES-OTHER> 12,418
<LONG-TERM> 64,290
0
0
<COMMON> 300
<OTHER-SE> 159,040
<TOTAL-LIABILITIES-AND-EQUITY> 1,405,411
<INTEREST-LOAN> 39,619
<INTEREST-INVEST> 2,622
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 42,241
<INTEREST-DEPOSIT> 12,529
<INTEREST-EXPENSE> 15,854
<INTEREST-INCOME-NET> 26,387
<LOAN-LOSSES> 1,173
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 2,122
<INCOME-PRETAX> 24,195
<INCOME-PRE-EXTRAORDINARY> 24,195
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 22,601
<EPS-PRIMARY> 75.34
<EPS-DILUTED> 75.34
<YIELD-ACTUAL> 8.24
<LOANS-NON> 106,567
<LOANS-PAST> 7,534
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 13,867
<CHARGE-OFFS> 1,134
<RECOVERIES> 78
<ALLOWANCE-CLOSE> 13,984
<ALLOWANCE-DOMESTIC> 13,984
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
