latest rankings of nonbank finance companies.

The disappearance of three companies from American Banker's semiannual top 25 list reflects consolidation in the sector (Avco Financial Services Inc.), the increasing influence of commercial banks (Commercial Credit Corp.), and financial problems (Aames Financial Corp.).

The top four places in the ranking by total capital funds at midyear have the same occupants as at yearend.

General Electric Capital Services is on top, despite a 9.87% decline in 12 months, to just under $199 billion. Total capital funds -- stockholder equity plus noncurrent subordinated debt -- provides an indication of the companies' ability to fund loans.

Finova Group Inc. of Phoenix made the largest gain in total capital funds -- 40.6%, to $5.8 billion -- to rank seventh.

Case Capital Corp. of Racine, Wis., made the list or the first time, at No. 9, with just over $3 billion. The company is the finance arm of Case Corp., a construction equipment manufacturer in Lincolnshire, Ill. (Tables appear on page 21.)

Commercial Credit, No. 5 in the nonbank finance company rankings at yearend, fell off the list because its parent, Travelers Group, merged with Citicorp. But not making the nonbank rankings does not mean that Baltimore-based Commercial Credit has done badly.

On the contrary, revenue has risen every quarter since 1995, to $587.3 million in the first quarter. And in April the company said that its first-quarter profits were 37% higher than a year earlier, at $81 million, helped by the cross-sales of products through Citigroup Inc.'s Primerica Financial Services.

In late April, Commercial Credit bought 41 Canadian branches from Associates First Capital Corp., having bought 100 in March. The Citigroup unit has more than 1,100 branches in 45 states.

Avco, which is based in Irvine, Calif., also dropped off the list because of an acquisition. Textron Inc. sold it to Associates First Capital on Jan. 7 for $3.9 billion. The purchase was Associates' biggest ever and brought it $6.2 billion of assets. The price was almost three times book value at the time, and 20 times Avco's earnings last year.

Subsequently, Associates sold 128 Avco branches to Citigroup's Commercial Credit. Then GE Capital bought all 160 Avco branches in Australia and New Zealand from Associates. Those 160 branches were said to have more than $1.2 billion of assets.

Dallas-based Associates retained its No. 4 ranking with a 34.2% increase in capital funds from one year earlier. The company's assets also grew by 35.46% to $85.89 billion from the previous June.

As the biggest home equity lender, Associates is an exception as a nonbank that is also a portfolio lender. It has been vying with Household International for the No. 1 rank in home equity lending, but Associates has a big lead in capital funds. It had $9.5 billion in total capital funds at midyear; Household had $6.4 billion.

In mid-June, Countrywide Credit Industries paid Associates $425 million for Balboa Life and Casualty Group, which Associates acquired in the Avco purchase.

Shares of Los Angeles-based Aames, the third absentee from the latest rankings, nosedived after the company ran into financial problems. Aames recorded a $248 million net loss for the fiscal year that ended June 30.

It has now joined forces with New York Capital Z Partners, which has pledged $125 million to the ailing company. The deal amounted to an out-of-court bankruptcy reorganization; it offered Capital Z a potential majority on Aames' board and options to buy to 76% of its shares at a fraction of their December trading value for an aggregate $76.5 million.

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