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EXCEL - IDEA: XBRL DOCUMENT - MERRILL LYNCH PREFERRED FUNDING III LP | Financial_Report.xls |
EX-12 - EXHIBIT 12 - MERRILL LYNCH PREFERRED FUNDING III LP | c20540exv12.htm |
EX-31.2 - EXHIBIT 31.2 - MERRILL LYNCH PREFERRED FUNDING III LP | c20540exv31w2.htm |
EX-32.2 - EXHIBIT 32.2 - MERRILL LYNCH PREFERRED FUNDING III LP | c20540exv32w2.htm |
EX-32.1 - EXHIBIT 32.1 - MERRILL LYNCH PREFERRED FUNDING III LP | c20540exv32w1.htm |
EX-99.1 - EXHIBIT 99.1 - MERRILL LYNCH PREFERRED FUNDING III LP | c20540exv99w1.htm |
EX-31.1 - EXHIBIT 31.1 - MERRILL LYNCH PREFERRED FUNDING III LP | c20540exv31w1.htm |
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended June 30, 2011
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
COMMISSION FILE NO.: 1-7182-06
MERRILL LYNCH PREFERRED CAPITAL TRUST III
(Exact name of Registrant as specified in its certificate of trust)
Delaware | 13-7139561 | |
(State or other jurisdiction of | (I.R.S. Employer Identification No.) | |
incorporation or organization) | ||
4 World Financial Center | ||
New York, New York | 10080 | |
(Address of principal executive offices) | (Zip Code) |
Registrants telephone number, including area code: (212) 449-1000
COMMISSION FILE NO.: 1-7182-05
MERRILL LYNCH PREFERRED FUNDING III, L.P.
(Exact name of Registrant as specified in its
certificate of limited partnership)
certificate of limited partnership)
Delaware | 13-3982448 | |
(State or other jurisdiction of | (I.R.S. Employer Identification No.) | |
incorporation or organization) | ||
4 World Financial Center | ||
New York, New York | 10080 | |
(Address of principal executive offices) | (Zip Code) |
Registrants telephone number, including area code: (212) 449-1000
Indicate by check mark whether the Registrants: (1) have 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
Registrants were required to file such reports), and (2) have been subject to
such requirements for the past 90 days. Yes þ No o
Indicate by check mark whether the Registrants have submitted electronically and
posted on their corporate web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of
this chapter) during the preceding 12 months (or for such shorter period that the
Registrants were required to submit and post such files). Yes þ No o
Indicate by check mark whether the Registrants are large accelerated filers,
accelerated filers, non-accelerated filers, or smaller reporting companies.
See definition of accelerated filer, large accelerated filer and smaller
reporting company in Rule 12b-2 of the Exchange Act.
(Check one)
Large accelerated filer o | Accelerated filer o | Non-accelerated filer þ | Smaller reporting company o | |||
(Do not check if a smaller reporting company) |
Indicate by check mark whether the Registrants are shell companies (as defined
in Rule 12b-2 of the Exchange Act). Yes o No þ
The Registrants meet the conditions set forth in General Instruction H 1 (a) and
(b) of Form 10-Q and are therefore filing this Quarterly Report on Form 10-Q (the Report)
with a reduced disclosure format.
TABLE OF CONTENTS
Table of Contents
PART I FINANCIAL INFORMATION
ITEM 1. | FINANCIAL STATEMENTS (Unaudited) |
MERRILL LYNCH PREFERRED CAPITAL TRUST III
CONDENSED BALANCE SHEETS
(unaudited)
(dollars in thousands, except per security amounts)
June 30, 2011 | December 31, 2010 | |||||||
ASSETS |
||||||||
Investment in affiliate partnership preferred securities |
$ | 773,196 | $ | 773,196 | ||||
Total Assets |
$ | 773,196 | $ | 773,196 | ||||
STOCKHOLDERS EQUITY |
||||||||
Preferred securities (7% Trust Originated Preferred
Securities; 30,000,000 authorized, issued, and
outstanding; $25 liquidation amount per security) |
$ | 750,000 | $ | 750,000 | ||||
Common securities (7% Trust Common Securities;
927,840 authorized, issued, and outstanding;
$25 liquidation amount per security) |
23,196 | 23,196 | ||||||
Total Stockholders Equity |
$ | 773,196 | $ | 773,196 | ||||
See Note to Condensed Financial Statements
2
Table of Contents
MERRILL LYNCH PREFERRED CAPITAL TRUST III
CONDENSED STATEMENTS OF EARNINGS
(unaudited)
(dollars in thousands)
FOR THE THREE MONTHS ENDED | ||||||||
June 30, 2011 | June 30, 2010 | |||||||
EARNINGS |
||||||||
Interest on affiliate partnership preferred securities |
$ | 13,531 | $ | 13,531 | ||||
FOR THE SIX MONTHS ENDED | ||||||||
June 30, 2011 | June 30, 2010 | |||||||
EARNINGS |
||||||||
Interest on affiliate partnership preferred securities |
$ | 27,062 | $ | 27,062 | ||||
See Note to Condensed Financial Statements
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Table of Contents
MERRILL LYNCH PREFERRED CAPITAL TRUST III
CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY
(unaudited)
(dollars in thousands)
FOR THE SIX MONTHS ENDED | ||||||||
June 30, 2011 | June 30, 2010 | |||||||
PREFERRED SECURITIES |
||||||||
Balance, beginning and end of period |
$ | 750,000 | $ | 750,000 | ||||
COMMON SECURITIES |
||||||||
Balance, beginning and end of period |
23,196 | 23,196 | ||||||
UNDISTRIBUTED EARNINGS |
||||||||
Balance, beginning of period |
| | ||||||
Earnings |
27,062 | 27,062 | ||||||
Distributions |
(27,062 | ) | (27,062 | ) | ||||
Balance, end of period |
| | ||||||
Total Stockholders Equity |
$ | 773,196 | $ | 773,196 | ||||
See Note to Condensed Financial Statements
4
Table of Contents
MERRILL LYNCH PREFERRED CAPITAL TRUST III
CONDENSED STATEMENTS OF CASH FLOWS
(unaudited)
(dollars in thousands)
FOR THE SIX MONTHS ENDED | ||||||||
June 30, 2011 | June 30, 2010 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||
Earnings |
$ | 27,062 | $ | 27,062 | ||||
Cash provided by operating activities |
27,062 | 27,062 | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
||||||||
Distributions |
(27,062 | ) | (27,062 | ) | ||||
Cash used for financing activities |
(27,062 | ) | (27,062 | ) | ||||
NET CHANGE IN CASH |
| | ||||||
CASH, BEGINNING OF PERIOD |
| | ||||||
CASH, END OF PERIOD |
$ | | $ | | ||||
See Note to Condensed Financial Statements
5
Table of Contents
MERRILL LYNCH PREFERRED CAPITAL TRUST III
NOTE TO CONDENSED FINANCIAL STATEMENTS (unaudited)
June 30, 2011
Merrill Lynch Preferred Capital Trust III (the Trust) is a statutory business trust formed under
the Delaware Business Trust Act, as amended. Merrill Lynch & Co., Inc. (ML&Co.) is the sole owner
of the Trust common securities.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
For a complete discussion of significant accounting policies, refer to the audited financial
statements included in the Trusts Annual Report on Form 10-K for the year ended December 31,
2010.
BASIS OF PRESENTATION
These unaudited condensed financial statements should be read in conjunction with the audited
financial statements included in the Annual Report on Form 10-K of the Trust for the year ended
December 31, 2010. The interim condensed financial statements for the three- and six-month periods
are unaudited; however, all adjustments necessary for a fair presentation of the condensed
financial statements have been included.
INVESTMENTS
The Trusts investment in Merrill Lynch Preferred Funding III, L.P. (the Partnership) Preferred
Securities represents a limited partnership interest in the Partnership and is recorded at cost.
Income on the Partnership Preferred Securities is accrued when earned.
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Table of Contents
MERRILL LYNCH PREFERRED FUNDING III, L.P.
CONDENSED BALANCE SHEETS
(unaudited)
(dollars in thousands)
(dollars in thousands)
June 30, 2011 | December 31, 2010 | |||||||
ASSETS |
||||||||
Investments: |
||||||||
Affiliate debentures |
$ | 900,547 | $ | 900,547 | ||||
U.S. Government and agencies |
9,112 | 9,101 | ||||||
Total investments |
909,659 | 909,648 | ||||||
Total Assets |
$ | 909,659 | $ | 909,648 | ||||
PARTNERS CAPITAL |
||||||||
Limited partnership interest |
$ | 773,196 | $ | 773,196 | ||||
General partnership interest |
136,463 | 136,452 | ||||||
Total Partners Capital |
$ | 909,659 | $ | 909,648 | ||||
See Note to Condensed Financial Statements
7
Table of Contents
MERRILL LYNCH PREFERRED FUNDING III, L.P.
CONDENSED STATEMENTS OF EARNINGS
(unaudited)
(dollars in thousands)
(dollars in thousands)
FOR THE THREE MONTHS ENDED | ||||||||
June 30, 2011 | June 30, 2010 | |||||||
EARNINGS |
||||||||
Interest income: |
||||||||
Affiliate debentures |
$ | 15,759 | $ | 15,759 | ||||
U.S. Government and agencies |
5 | 4 | ||||||
Earnings |
$ | 15,764 | $ | 15,763 | ||||
FOR THE SIX MONTHS ENDED | ||||||||
June 30, 2011 | June 30, 2010 | |||||||
EARNINGS |
||||||||
Interest income: |
||||||||
Affiliate debentures |
$ | 31,519 | $ | 31,519 | ||||
U.S. Government and agencies |
11 | 9 | ||||||
Earnings |
$ | 31,530 | $ | 31,528 | ||||
See Note to Condensed Financial Statements
8
Table of Contents
MERRILL LYNCH PREFERRED FUNDING III, L.P.
CONDENSED
STATEMENTS OF CHANGES IN PARTNERS CAPITAL
(unaudited)
(dollars in thousands)
(dollars in thousands)
FOR THE SIX MONTHS ENDED | ||||||||
June 30, 2011 | June 30, 2010 | |||||||
LIMITED PARTNERS CAPITAL |
||||||||
Balance, beginning of period |
$ | 773,196 | $ | 773,196 | ||||
Earnings allocated to limited partner |
27,062 | 27,062 | ||||||
Distributions |
(27,062 | ) | (27,062 | ) | ||||
Balance, end of period |
773,196 | 773,196 | ||||||
GENERAL PARTNERS CAPITAL |
||||||||
Balance, beginning of period |
136,452 | 136,456 | ||||||
Earnings allocated to general partner |
4,468 | 4,466 | ||||||
Distributions |
(4,457 | ) | (4,470 | ) | ||||
Balance, end of period |
136,463 | 136,452 | ||||||
TOTAL PARTNERS CAPITAL |
$ | 909,659 | $ | 909,648 | ||||
See Note to Condensed Financial Statements
9
Table of Contents
MERRILL LYNCH PREFERRED FUNDING III, L.P.
CONDENSED STATEMENTS OF CASH FLOWS
(unaudited)
(dollars in thousands)
(dollars in thousands)
FOR THE SIX MONTHS ENDED | ||||||||
June 30, 2011 | June 30, 2010 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||
Earnings |
$ | 31,530 | $ | 31,528 | ||||
Accretion of interest on securities issued by
U.S. Government and agencies |
(11 | ) | (9 | ) | ||||
Cash provided by operating activities |
31,519 | 31,519 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES: |
||||||||
Purchase of investment securities |
| (9,095 | ) | |||||
Maturities of investment securities |
| 9,108 | ||||||
Cash provided by investing activities |
| 13 | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
||||||||
Distributions to limited partner |
(27,062 | ) | (27,062 | ) | ||||
Distributions to general partner |
(4,457 | ) | (4,470 | ) | ||||
Cash used for financing activities |
(31,519 | ) | (31,532 | ) | ||||
NET CHANGE IN CASH |
| | ||||||
CASH, BEGINNING OF PERIOD |
| | ||||||
CASH, END OF PERIOD |
$ | | $ | | ||||
See Note to Condensed Financial Statements
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Table of Contents
MERRILL LYNCH PREFERRED FUNDING III, L.P.
NOTE TO CONDENSED FINANCIAL STATEMENTS (unaudited)
June 30, 2011
June 30, 2011
Merrill Lynch Preferred Funding III, L.P. (the Partnership) is a limited partnership formed
under the Delaware Revised Uniform Limited Partnership Act, as amended. Merrill Lynch & Co., Inc.
(ML&Co.) is the sole general partner of the Partnership.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
For a complete discussion of significant accounting policies, refer to the audited financial
statements included in the Partnerships Annual Report on Form 10-K for the year ended December 31,
2010.
BASIS OF PRESENTATION
These unaudited condensed financial statements should be read in conjunction with the audited
financial statements included in the Annual Report on Form 10-K of the Partnership for the year
ended December 31, 2010. The interim condensed financial statements for the three- and six-month
periods are unaudited; however, all adjustments necessary for a fair presentation of the condensed
financial statements have been included.
INVESTMENTS
The Partnerships investment in affiliate debentures is recorded at cost. Its investment in U.S.
Government and agency securities is recorded at accreted cost and matures within one year. At June
30, 2011, the estimated fair value of the investment in affiliate debentures was approximately $884
million. The fair value of the investment in U.S. Government and agency securities approximated
its carrying value.
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Table of Contents
ITEM 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
No disclosure is required for this Item pursuant to General Instruction H of Form 10-Q. There were
no material changes in the amount of revenue and expense items between the most recent calendar
year-to-date period presented and the corresponding period in the preceding year.
ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
No disclosure is required for this Item pursuant to General Instruction H of
Form 10-Q.
ITEM 4. | CONTROLS AND PROCEDURES |
The Trust
The person who functions as the equivalent of the Chief Executive Officer and the Chief Financial
Officer of the Trust has evaluated the effectiveness of the Trusts disclosure controls and
procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of the end
of the period covered by this Report. Based on this evaluation, the person who functions as the
equivalent of the Chief Executive Officer and the Chief Financial Officer of the Trust has
concluded that the Trusts disclosure controls and procedures are effective as of the end of the
period covered by this Report.
In addition, no change in the Trusts internal control over financial reporting (as defined in Rule
13a-15(f) under the Securities Exchange Act of 1934) occurred during the three months ended June
30, 2011 that has materially affected, or is reasonably likely to materially affect, the Trusts
internal control over financial reporting.
The Partnership
The person who functions as the equivalent of the Chief Executive Officer and the Chief Financial
Officer of the Partnership has evaluated the effectiveness of the Partnerships disclosure controls
and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of the
end of the period covered by this Report. Based on this evaluation, the person who functions as the
equivalent of the Chief Executive Officer and the Chief Financial Officer of the Partnership has
concluded that the Partnerships disclosure controls and procedures are effective as of the end of
the period covered by this Report.
In addition, no change in the Partnerships internal control over financial reporting (as defined
in Rule 13a-15(f) under the Securities Exchange Act of 1934) occurred during the three months ended
June 30, 2011 that has materially affected, or is reasonably likely to materially affect, the
Partnerships internal control over financial reporting.
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Table of Contents
PART II OTHER INFORMATION
Item 1A. | Risk Factors |
There are no material changes from the risk factors set forth under Part I, Item 1A. Risk Factors
in the Trusts and the Partnerships 2010 Annual Report on Form 10-K, other than the addition of
the risk factors included in ML&Co.s Quarterly Report on Form 10-Q for the quarterly period ended
June 30, 2011, which are incorporated by reference from Exhibit 99.1 to this Report.
ITEM 6. | EXHIBITS |
An exhibit index has been filed as part of this Report and is incorporated herein by reference.
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Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrants have duly
caused this Report to be signed on their behalf by the undersigned thereunto duly authorized.
MERRILL LYNCH PREFERRED CAPITAL TRUST III* |
||||
By: | /s/ ANGELA C. JONES | |||
Name: | Angela C. Jones | |||
Title: | Regular Trustee | |||
MERRILL LYNCH PREFERRED FUNDING III, L.P.* |
||||
By: | MERRILL LYNCH & CO., INC., as General Partner | |||
By: | /s/ PETER D. TAUBE | |||
Name: | Peter D. Taube | |||
Title: | Chief Accounting Officer and Controller, Merrill Lynch & Co., Inc. |
Date: August 12, 2011
* | There is no principal executive officer(s), principal financial officer, controller, principal accounting officer or board of directors of the Registrants. The Trustees of the Trust (which include the Regular Trustees, the Property Trustee and the Delaware Trustee) together exercise all powers and perform all functions with respect to the Trust. |
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Table of Contents
INDEX TO EXHIBITS
EXHIBITS | ||||
12 | Statement re: Computation of Ratios of Earnings to Combined Fixed Charges and Preferred
Securities Distributions.(1) |
|||
31.1 | Rule 13a-14(a) Certification(1) |
|||
31.2 | Rule 13a-14(a) Certification(1) |
|||
32.1 | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(1) |
|||
32.2 | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(1) |
|||
99.1 | Excerpt of Merrill Lynch & Co., Inc. Quarterly Report on Form 10-Q
for the period ended June 30, 2011.(1) |
|||
101 | The following materials from Merrill Lynch Preferred Capital Trust III and Merrill Lynch
Preferred Funding III, L.P. Quarterly Reports on Form 10-Q for the three and six month periods
ended June 30, 2011, formatted in XBRL (Extensible Business Reporting Language): (i) the
Condensed Balance Sheets, (ii) the Condensed Statements of Earnings, (iii) the Condensed
Statements of Changes in Stockholders Equity, (iv) the Condensed Statements of Cash Flows,
and (v) the Note to Condensed Financial Statements, tagged as blocks of
text.(1,2) |
(1) | Included herewith. | |
(2) | These interactive data files shall not be deemed filed for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, or Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liability under those sections. |
15