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SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark one)

OR

Commission File Number 333-74817

MAIN PLACE FUNDING, LLC

(Exact name of registrant as specified in its charter)

100 North Tryon Street, Charlotte, NC 28255

(Address of principal executive offices) (Zip Code)

(704) 388-8232

(Registrant’s telephone number, including area code)

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  ¨

On May 13, 2003, there were no shares of common stock outstanding. As of May 13, 2003, Bank of America, N.A. holds 100 percent membership interest in Main Place.

THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H (1) (a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED DISCLOSURE FORMAT.

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Main Place Funding, LLC

March 31, 2003 Form 10-Q

Index

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Part I. FINANCIAL INFORMATION

Item 1. Financial Statements

Main Place Funding, LLC

Statement of Income

(Dollars in Thousands)

See accompanying notes to financial statements.

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Main Place Funding, LLC

Balance Sheet

(Dollars in Thousands)

See accompanying notes to financial statements.

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Main Place Funding, LLC

Statement of Cash Flows

(Dollars in Thousands)

See accompanying notes to financial statements.

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Main Place Funding, LLC

Statement of Changes in Members’ Equity

(Dollars in Thousands)

See accompanying notes to financial statements.

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Main Place Funding, LLC

Notes to Financial Statements

Note 1 – Description of Business

Main Place Funding, LLC (“Main Place”), a Delaware limited liability company, is a subsidiary of Bank of America, N.A. (the “Parent”), which is a wholly owned indirect subsidiary of Bank of America Corporation (the “Corporation”).

Main Place was established originally as a Maryland real estate investment trust to consolidate the acquisition, holding and management of certain closed-end residential mortgage loans owned by certain affiliates of the Corporation. The Parent holds a 100 percent membership interest in Main Place. Main Place is also considered a single-member LLC under current tax law.

On October 21, 2002, Main Place adopted an Amended and Restated Limited Liability Company Agreement, filed under cover of Form 8-K, which removed certain restrictions on the business activities of Main Place permitting it to engage in any activity and to exercise any powers permitted to limited liability companies under the laws of the State of Delaware.

Under these expanded powers, Main Place has entered into the business of entering into financial warranty agreements in favor of third parties for a fee. As of March 31, 2003, Main Place has entered into three financial warranty agreements with third-party trusts. These trusts are open-ended diversified, registered investment companies. Under the terms of these warranty agreements, Main Place provides financial warranties in order to ensure that the trusts are able to redeem all of the outstanding shares of specified series on the warranty maturity dates for an amount at least equal to an aggregate protected amount. For each of the agreements entered into by Main Place with a third party, Main Place has also entered into a financial warranty agreement with the Parent. Under the terms of these agreements, the Parent provides financial warranties in favor of Main Place corresponding to Main Place’s obligations under the financial warranties with the third parties.

Note 2 – Summary of Significant Accounting Policies

Basis of Presentation

The information contained in the financial statements is unaudited. In the opinion of management, all normal recurring adjustments necessary for a fair statement of the interim period results have been made. Certain prior period amounts have been reclassified to conform to current period classifications. The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from these estimates. Significant estimates made by management are discussed in these footnotes as applicable. Accounting policies followed in the presentation of interim financial results are presented in Note 2 on pages 16 to 18 of the Annual Report on Form 10-K for the year ended December 31, 2002.

Recently Issued Accounting Pronouncements

FASB Interpretation No. 45, ”Guarantor’s Accounting and Disclosure Requirements for Guarantees”, (FIN 45) was issued in November 2002. FIN 45 requires that a liability be recognized at the inception of certain guarantees for the fair value of the obligation, including the ongoing obligation to stand ready to perform over the term of the guarantee. Guarantees, as defined in FIN 45, include contracts that contingently require Main Place to make payments to a guaranteed party based on changes to an asset, liability or equity security of the guaranteed party, performance guarantees, indemnification agreements or indirect guarantees of indebtedness of others. This new accounting was effective for certain guarantees issued or modified after December 31, 2002. In addition, FIN 45

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requires certain additional disclosures that are located in Note 3. Management does not expect that the adoption of FIN 45 will have a material impact on Main Place’s results of operations or financial condition.

Note 3 – Derivatives – Financial Warranty Agreements

Main Place has entered into the business of entering into financial warranty agreements in favor of third parties for a fee. As of March 31, 2003, Main Place has entered into three financial warranty agreements with third party trusts, in an aggregate amount of $728 million. For each of the agreements entered into by Main Place with a third party, Main Place has also entered into a financial warranty agreement with the Parent. Net trading account profits and fees from these agreements totaled $63 thousand for the first quarter of 2003.

On October 29, 2002, Main Place entered into a financial warranty agreement with Pioneer Principal Protection Trust on behalf of its series Pioneer Protected Principal Plus Fund and Pioneer Investment Management, Inc., filed under cover of Form 8-K dated as of October 21, 2002. The trust is an open-ended diversified, registered investment company registered under the Investment Company Act of 1940, as amended. Under the terms of the agreement, Main Place provided a financial warranty to the trust in the amount of up to $180.3 million in order to ensure that the trust is able to redeem all of the outstanding shares of the series on the maturity date, as defined in the financial warranty agreement. The last day upon which the financial warranty may be drawn is January 8, 2010.

On December 20, 2002, Main Place entered into a financial warranty agreement with the Parent, filed on the third quarter 10-Q as Exhibit 10.1. Under the terms of this agreement, the Parent provided a financial warranty in favor of Main Place in the amount of up to $180.3 million, corresponding to Main Place’s obligations under the financial warranty in favor of Pioneer Principal Protection Trust on behalf of its series, Pioneer Protected Principal Plus Fund.

The financial warranty amount of $180.3 million represents the maximum potential exposure of these agreements. There is no specific collateral associated with the financial warranty agreements.

On November 1, 2002, Main Place entered into a financial warranty agreement with Merrill Lynch Principal Protected Trust, on behalf of its series Merrill Lynch Fundamental Growth Principal Protected Fund and Merrill Lynch Investment Managers, L.P., filed under cover of Form 8-K dated as of October 21, 2002. The trust is an open-ended diversified, registered investment company registered under the Investment Company Act of 1940, as amended. Under the terms of the agreement, Main Place provided a financial warranty in the amount of up to $265.9 million in order to ensure that the trust is able to redeem all of the outstanding shares of the series on the maturity date, as defined in the financial warranty agreement. The last day upon which the financial warranty may be drawn is December 1, 2009.

On November 13, 2002, Main Place entered into a financial warranty agreement with the Parent, filed on the third quarter 10-Q as Exhibit 10.2. Under the terms of this agreement, the Parent provided a financial warranty in favor of Main Place in the amount of up to $265.9 million, corresponding to Main Place’s obligations under the financial warranty in favor of Merrill Lynch Principal Protected Trust, on behalf of its series Merrill Lynch Fundamental Growth Principal Protected Fund.

The financial warranty amount of $265.9 million represents the maximum potential exposure of these agreements. There is no specific collateral associated with the financial warranty agreements.

On November 1, 2002, Main Place entered into a financial warranty agreement with Merrill Lynch Principal Protected Trust, on behalf of its series Merrill Lynch Basic Value Principal Protected Fund and Fund Asset Management, L.P., filed under cover of Form 8-K dated as of October 21, 2002. The trust is an open-ended diversified, registered investment company registered under the Investment Company Act of 1940, as amended. Under the terms of the agreement, Main Place provided a financial warranty in the amount of up to $335.8 million in order to ensure that the trust is able to redeem all of the outstanding shares of the series on the maturity date, as defined in the financial warranty agreement. The last day upon which the financial warranty may be drawn is December 1, 2009.

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On November 13, 2002, Main Place entered into a financial warranty agreement with the Parent, filed on the third quarter 10-Q as Exhibit 10.3. Under the terms of this agreement, the Parent provided a financial warranty in favor of Main Place in the amount of up to $335.8 million, corresponding to Main Place’s obligations under the financial warranty in favor of Merrill Lynch Principal Protected Trust, on behalf of its series Merrill Lynch Basic Value Principal Protected Fund.

The financial warranty amount of $335.8 million represents the maximum potential exposure of these agreements. There is no specific collateral associated with the financial warranty agreements.

Note 4 – Affiliate Transactions

Main Place maintains its cash and cash equivalent accounts with the Parent. As of March 31, 2003 and December 31, 2002, Main Place had $7.0 billion and $14.3 billion, respectively, of time deposits placed with the Parent. Remaining amounts disclosed within cash and cash equivalents represent cash balances maintained with the Parent. Interest income on time deposits placed with the Parent for the three months ended March 31, 2003 and 2002 was $34.0 million and $49.8 million, respectively. On February 28, 2003, Main Place distributed $7.5 billion of its time deposits to the Parent as a return of capital.

The Parent has entered into financial warranty agreements with Main Place. Under the terms of these agreements, the Parent provides financial warranties in favor of Main Place in an aggregate amount of $728.0 million, which corresponds with Main Place’s obligations under financial warranty agreements in favor of third parties. During the first quarter of 2003, Main Place paid $1.1 million of fees to the Parent related to these agreements.

Due to affiliates as of March 31, 2003 and December 31, 2002 were $167.6 million and $1.1 billion, respectively. The March 31, 2003 balance is composed entirely of income tax payable to the Parent of $167.6 million. The December 31, 2002 balance was composed primarily of a $900.5 million payable that was a result of an operational error made during the distribution of loans to the Parent in December 2002. The $900.5 million payable was settled during January 2003.

The Parent performs all of the operational services for Main Place and since Main Place is a wholly-owned subsidiary of the Parent, no charges are incurred by Main Place. Main Place would be required to pay for these services if they were performed by a party other than the Parent.

Note 5 – Fair Values of Financial Instruments

Statement of Financial Accounting Standards No. 107, “Disclosures About Fair Value of Financial Instruments,” requires the disclosure of the estimated fair values of financial instruments. The fair value of an instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. Quoted market prices, if available, are utilized as estimates of the fair values of financial instruments. Fair values of items for which no quoted market prices exist have been derived based on management’s assumptions, the estimated amount and timing of future cash flows and estimated discount rates. The estimation methods for individual classifications of financial instruments are more fully described below. Different assumptions could significantly affect these estimates. Accordingly, the net realizable values could be materially different from the estimates presented below. In addition, the estimates are only indicative of individual instruments’ values and should not be considered an indication of the fair value of Main Place.

Short – Term Financial Instruments

The carrying value of short-term financial instruments and derivatives, including cash and cash equivalents, repurchase agreements, accounts receivable from affiliates and interest receivable approximates the fair value. These financial instruments generally expose Main Place to limited credit risk, have no stated maturities or have maturities of less than 90 days and carry interest rates which approximate market.

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Derivatives

All derivatives are recognized on the balance sheet at fair value.

Item 2. Management’s Discussion and Analysis of Results of Operations and Financial Condition

Total net income was $21.7 million and $85.7 million for the first quarter of 2003 and 2002, respectively. The decrease primarily resulted from decreases in interest income, partially offset by decreases in interest expense on long term debt, reduced funding costs associated with the repurchase agreements and lower operating and tax expenses. Income tax expense was $12.2 million for the three months ended March 31, 2003, compared to $48.2 million for the three months ended March 31, 2002.

Total income for the first quarter of 2003 was $34.0 million, representing a decrease of $114.5 million from the corresponding period in 2002. The decrease was primarily a result of the change in business activities of Main Place, as the remaining loan and available-for-sale securities portfolios were distributed to the Parent on December 20, 2002. Due to this distribution, no loan or securities income was recorded in the quarter ended March 31, 2003. The decrease in total income also includes declines in interest on time deposits placed of $15.8 million, resulting from a reduction of 52 basis points in average yields to 1.19 percent and a reduction in the time deposits placed balance for the $7.5 billion return of capital to the Parent on February 28, 2003.

Total expenses (excluding income taxes) for the first quarter of 2003 were $98 thousand, representing a decrease of $14.4 million compared to the same period in 2002. The decrease includes a decline in interest expense on securities sold under agreements to repurchase of $1.7 million, resulting from the termination of the repurchase agreements in conjunction with the securities distribution to the Parent. Interest expense on long-term debt also declined $8.3 million the first quarter of 2003 as Main Place repaid its remaining debt obligations on May 28, 2002. Due to the distribution of loans to the Parent, no servicing fees on loans were recorded for the quarter ended March 31, 2003. Servicing fees paid to the Parent approximated $4.0 million for the three months ended March 31, 2002 and were included in other operating expenses.

Critical Accounting Estimates and Principles

Main Place’s significant accounting principles are presented in item 7 on page 4 of the Annual Report on Form 10-K for the year ended December 31, 2002 and are essential to understanding Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Item 4. Controls and Procedures

Within the 90 days prior to the filing date of this report, Main Place carried out an evaluation, under the supervision and with the participation of Main Place’s management, including Main Place’s president and principal financial and accounting officer, of the effectiveness of the design and operation of Main Place’s disclosure controls and procedures pursuant to Rule 13a-14 under the Securities Exchange Act of 1934. Based upon that evaluation, Main Place’s president and principal financial and accounting officer concluded that Main Place’s disclosure controls and procedures are effective in timely alerting them to material information relating to Main Place required to be included in Main Place’s periodic SEC filings.

Since the date of the evaluation, there have been no significant changes in Main Place’s internal controls or in other factors that could significantly affect these controls.

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Part II. OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K

None.

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SIGNATURE

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.

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CERTIFICATIONS

Main Place Funding, LLC

Certification Pursuant to Section 302 of The Sarbanes-Oxley Act of 2002

I, Jonathan Sandelman, certify that:

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CERTIFICATIONS

Main Place Funding, LLC

Certification Pursuant to Section 302 of The Sarbanes-Oxley Act of 2002

I, Michael Coppins, certify that:

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Main Place Funding, LLC

Form 10-Q

Index to Exhibits

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