SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 15, 1997
________________________ADVANTA Corp.____________________________
(Exact name of registrant as specified in its charter)
_______Delaware__________ _____0-14120________ ______23-1462070__
(State or other jurisdic- (Commission File (IRS Employer
tion of incorporation or Number) Identification No.)
Organization)
Welsh and McKean Roads, P.O. Box 844, Spring House, PA _
(Address of principal executive offices)
19477
(Zip Code)
Registrant's telephone number, including area code: (215) 657-4000
<PAGE>
5. Other Events.
On October 15, 1997 Advanta Corporation continues to report
dramatically improved profitability as it today announced that net
income for the third quarter 1997 totaled $42.4 million or earnings
per share of $0.92. For the third quarter 1996 net income totaled
$44.4 million for $0.98 per share. Earnings for the third quarter
1997 rose significantly from the $5.4 million or $0.12 per share
reported for the second quarter 1997. For the third quarter 1997,
Advanta reported increased net revenues of $254.3 million versus
$232.8 million recorded in the third quarter 1996 and $216.1 million
in the second quarter 1997.
<PAGE>
Highlights for the third quarter include the following items:
Managed net interest margin increased to 8.01%, above the
7.60% recorded in the second quarter, and the 6.19% posted
in the comparable period of 1996. The impact of the
Company's repricing efforts contributed to a higher
average yield in the credit card portfolio.
The absolute level of net managed credit card charge-offs
in the third quarter, $202 million, declined from the $210
million charged-off during second quarter 1997, compared
to the $119 million charged-off in third quarter 1996.
The charge-off rate on managed credit cards was 7.39% for
the quarter, compared to 7.24% in the prior quarter and
above the 3.70% of a year ago. Similar to the charge-off
figures, the absolute level of managed credit card 30+
delinquencies in the third quarter, $549 million, declined
versus the $554 million at the end of June 1997, and rose
versus the $494 million at September 1996. The managed
credit card 30+ day delinquency rate was 5.20%, above the
4.95% registered at June 30, and above the 3.89% of the
year ago period.
Advanta Personal Finance originated $950 million in new
business during the third quarter, more than double the
year ago level. This record volume helped to increase the
balance of managed receivables to $4.6 billion, up 95.3%
over September 1996. In addition, the Company services
$8.9 billion on a third party contract basis, bringing the
total portfolio serviced to $13.5 billion.
Total managed receivables of $16.4 billion as of
September 30, 1997 rose 3.7% over the $15.8 billion at the end
of September 1996. Managed credit card receivables at
September 30 of $10.5 billion recorded a decrease of 17.0%
from the $12.7 billion level last September. Compared to the
$11.2 billion at the close of June, the managed credit card
receivables balance declined 5.7%. The Company now expects to
end 1997 with credit card receivables in the range of
approximately $11 billion to $12 billion and total receivables
in the range of $17.5 billion to $18.5 billion.
Other noteworthy items in the quarter included a cash
rebate of $10 million for prior periods' performance on
credit card processing, the addition of approximately $10
million to the Company's on-balance sheet reserve for
credit losses, and the bolstering of the Company's
prepayment reserves by $6 million.
Any statements released by Advanta that are forward looking are
made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Investors are cautioned
that forward-looking statements involve risks and uncertainties
which may affect the Company's business and prospects. At
present, significant risks and uncertainties include: the
Company's managed net interest margin, which in turn is affected
by the Company's success in originating new credit card accounts,
receivables volume and initial pricing of new accounts, the impact
of repricing existing accounts and account attrition, the mix of
account types and interest rate fluctuations; the level of
delinquencies, customer bankruptcies, and charge-offs; and the
amount and rate of growth in the Company's expenses. Earnings may
also be significantly affected by factors that affect consumer
debt, competitive pressures from other providers of financial
services, the effects of governmental regulation, the amount and
cost of financing available to the Company and its subsidiaries,
the difficulty or inability to securitize the Company's
receivables, and the impact of the ratings on debt of the Company
and its subsidiaries. Additional risks that may affect future
performance are detailed in the Company's filings with the SEC.
<PAGE>
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
The following exhibit is filed as part of this Report on
Form 8-K:
27 Financial Data Schedules.
99 Selected summary financial data.
<PAGE>
Exhibit 99
ADVANTA AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
($ in millions, except per share data)
Three Months Ended % Change
September 30, 1997 versus
1997 1996 1996
OPERATING RESULTS
Net Revenues $254.3 $232.8 9%
Provision for Losses $ 48.2 $ 24.2 99%
Operating Expenses $148.9 $141.3 5%
Net Income $ 42.4 $ 44.4 (4%)
Earnings Per Common Share $ 0.92 $ 0.98 (6%)
Average Shares (Millions) 46.1 45.2 2%
Return on Common Equity 21.3% 25.0% (15%)
Managed Net Interest Margin 8.01% 6.19% 29%
Nine Months Ended % Change
September 30, 1997 versus
1997 1996 1996
OPERATING RESULTS
Net Revenues(A) $652.9 $610.1 7%
Provision for Losses $158.9 $ 67.0 137%
Operating Expenses $456.3 $379.2 20%
Net Income $ 28.0 $130.5 (79%)
Earnings Per Common Share $ 0.60 $ 2.89 (79%)
Average Shares (Millions) 46.1 45.1 2%
Return on Common Equity 4.1% 26.0% (84%)
Managed Net Interest Margin 7.55% 6.08% 24%
(A) Excludes $33.8 million gain on sale of credit card
relationships in the second quarter of 1996.
<PAGE>
Exhibit 99
ADVANTA AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
($ in millions, except per share data)
% Change
Sept. 1997
Sept. 30, June 30, Sept. 30, versus
1997 1997 1996 Sept. 1996
FINANCIAL CONDITION
Managed Receivables*
Credit Cards(A) $10,547 $11,186 $12,711 (17%)
Personal Finance(B) $ 4,582 $ 3,934 $ 2,346 95%
Business Loans(C) $ 1,201 $ 1,090 $ 725 66%
Other Loans $ 57 $ 54 $ 15 274%
Total Managed
Receivables $16,387 $16,264 $15,797 4%
Total Managed Assets $20,796 $20,655 $18,357 13%
Stockholders' Equity $ 880 $ 838 $ 798 10%
Book Value Per
Common Share $ 18.04 $ 17.32 $ 17.14 5%
Equity/Managed Assets 4.71% 4.54% 4.35% 8%
Reserve for Credit
Losses $ 126.6 $ 116.9 $ 77.6 63%
Customer Accounts 6,256,152 6,487,588 5,854,627 7%
CREDIT QUALITY
Managed Net Charge-off Rate
Credit Cards 7.39% 7.24% 3.70%
Personal Finance 0.85% 0.63% 0.74%
Total Receivables 5.38% 5.54% 3.21%
Managed 30+ Day Delinquency Rate
Credit Cards 5.20% 4.95% 3.89%
Personal Finance 7.05% 6.36% 5.37%
Total Receivables 5.74% 5.35% 4.23%
(A) Figures do not include Advanta's portion of joint venture
receivables which at September 30, 1997 approximated $394.3
million.
(B) Includes Mortgages and Auto loans.
(C) Includes Leases and Business Cards.
* Managed receivables combine owned and securitized receivables.
<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 thereunto duly authorized.
ADVANTA Corp.
Date: October 15, 1997 By: /s/ Elizabeth H. Mai
Elizabeth H. Mai, Senior
Vice President & General
Counsel
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