SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549



                                    FORM 10-Q
         --------------------------------------------------------------


                QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934


                      For Quarter Ended September 30, 1996
                         Commission File Number 33-42666

                 COLLATERALIZED MORTGAGE SECURITIES CORPORATION
             (Exact name of registrant as specified in its chapter)
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<S>                                                   <C>       
                  Maryland                                         13-3251782
----------------------------------------------        ------------------------------------
(State or other jurisdiction of incorporation)        (I.R.S. Employer Identification No.)


    Park Avenue Plaza, New York, New York                            10055
----------------------------------------------        ------------------------------------
   (Address of principal executive offices)                        (Zip Code)

Registrant's telephone number, including area code                212-322-1811
                                                      ------------------------------------

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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 
    ---      ---

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:

                          10,000 shares of common stock
                       outstanding as of October 25, 1996
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          COLLATERALIZED MORTGAGE SECURITIES CORPORATION AND SUBSIDIARY
                                      INDEX
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<CAPTION>

                                                                                                    Page
                                                                                                 Number

PART I            FINANCIAL INFORMATION

<S>      <C>               <C>                                                                       <C> 
         Item     1.       Financial Statements

                           Consolidated Statements of Financial Condition as of
                                    September 30, 1996 and December 31, 1995                          3

                           Consolidated Statements of Operations for the Nine Months
                                    Ended September 30, 1996 and 1995                                 4

                           Consolidated Statements of Cash Flows for the Nine Months
                                    Ended September 30, 1996 and 1995                                 5

                           Notes to Consolidated Financial Statements                                 6

         Item     2.       Management's Discussion and Analysis of Financial
                                    Condition and Results of Operations                               7

PART II           OTHER INFORMATION

         Item     1.       Legal Proceedings                                                          8

         Item     2.       Changes in Securities                                                      8

         Item     3.       Defaults Upon Senior Securities                                            8

         Item     4.       Submission of Matters to a Vote of Security Holders                        8

         Item     5.       Other Information                                                          8

         Item     6        Exhibits and Reports on Form 8-K                                           8,9

SIGNATURE                                                                                             10

INDEX TO EXHIBITS                                                                                     11

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                                     Page 2
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          COLLATERALIZED MORTGAGE SECURITIES CORPORATION AND SUBSIDIARY
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION


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<CAPTION>

                                                                       September 30,                December 31,
                                                                           1996                         1995
                                                                    --------------------          ------------------
                                                                        (unaudited)
                                                                    (in thousands, except par value and share data)

<S>                                                                   <C>                           <C>
Assets:

Cash                                                                  $       12                    $       12
Receivable from CS First Boston                                   
   Securities Corporation                                                      1                         1,201
                                                                      ----------                    ----------
          Total Assets                                                $       13                    $    1,213
                                                                      ==========                    ==========
                                                                  
                                                                  
Liabilities and Stockholder's Equity:                             
                                                                  
Accrued expenses                                                      $       --                    $       --
                                                                      ----------                    ----------
                                                                                                            
          Total Liabilities                                                   --                            --
                                                                      ----------                    ----------
                                                                  
Stockholder's Equity:                                             
   Common stock and paid in capital, $.01 par value               
   (authorized 15,000,000shares; issued 10,000 shares                         13                         1,213
   at September 30, 1996 and December 31, 1995)                       ----------                    ----------
                                                                  
                                                                  
          Total Liabilities and Stockholder's Equity                  $       13                    $    1,213
                                                                      ==========                    ==========
                                                                 
</TABLE>

                 See Notes to Consolidated Financial Statements.

                                     Page 3

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          COLLATERALIZED MORTGAGE SECURITIES CORPORATION AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (unaudited)

<TABLE>
<CAPTION>

                                                            Nine Months                  Nine Months
                                                               Ended                        Ended
                                                         September 30, 1996           September 30, 1995
                                                         ------------------           ------------------
                                                                          (in thousands)

<S>                                                      <C>                          <C>    
Revenues:
     Commitment fee and miscellaneous
               income                                    $                  --      $                     --
                                                        -----------------------     ------------------------


Expenses:
     General and administrative expenses                                    --                            --
                                                        -----------------------     ------------------------
                                                                                                            
                                                                            --                            --
                                                        -----------------------     ------------------------

Loss from operations before income tax                                                 
     benefit                                                                --                            --
                                                        

Income tax benefit                                                          --                            --
                                                        -----------------------     ------------------------
                                                        
Net loss                                                $                   --      $                     -- 
                                                        =======================     ======================== 
                                                        

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                 See Notes to Consolidated Financial Statements.

                                     Page 4


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          COLLATERALIZED MORTGAGE SECURITIES CORPORATION AND SUBSIDIARY
                CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (unaudited)

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<CAPTION>

                                                                Nine Months                 Nine Months
                                                                   Ended                       Ended
                                                            September 30, 1996          September 30, 1995
                                                            ------------------          ------------------
                                                                            (in thousands)

<S>                                                       <C>                         <C>   
Cash Flows From Operating Activities:
-------------------------------------
Net loss                                                  $                  --       $                --
                                                                                                         
Adjustments to reconcile net loss                                                    
  to net cash provided by (used for)                                                 
  operating activities:                                                              
Increase (decrease) in accrued expenses                                      --                        --
Decrease in receivable from CS First Boston                                          
     Securities Corporation                                               1,200                        --
                                                          ---------------------       -------------------

Net Cash Flows Provided by Operating Activities                           1,200                        --
                                                          ---------------------       -------------------
Cash Flows From Financing Activities:                                               
------------------------------------

Net proceeds from (payments for):
      Dividends paid                                                    (1,200)                        --
                                                          ---------------------       -------------------
Net Cash Flows Used by Financing Activities                             (1,200)                        --
                                                          ---------------------       -------------------
Net increase (decrease) in cash                                              --                        --

Cash at beginning of period                                                  12                        12
                                                          ---------------------       -------------------
Cash at end of period                                     $                  12       $                12
                                                          =====================       ===================




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                 See Notes to Consolidated Financial Statements.

                                     Page 5

<PAGE>



          COLLATERALIZED MORTGAGE SECURITIES CORPORATION AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (unaudited)


1.       Description of Business


         Collateralized Mortgage Securities Corporation (the "Company") and its
         wholly owned subsidiary Asset Backed Securities Corporation ("ABSC")
         are wholly owned subsidiaries of CS First Boston Securities Corporation
         ("FBSC"), which is a wholly owned subsidiary of CS First Boston, Inc.,
         a privately owned holding company.

         The foregoing financial statements are unaudited; however, in the
         opinion of management, all adjustments (comprising only normal
         recurring accruals) necessary for a fair presentation of the financial
         statements have been included. A summary of the significant accounting
         policies is set forth in Note 3 to the Company's December 31, 1995
         Financial Statements contained in the Company's 1995 Form 10-K.




                                     Page 6


<PAGE>



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

            The principal activities of the Company and ABSC include (i) issuing
            and selling collateralized mortgage obligations and asset backed
            obligations (the "Bonds") and acquiring, owning, holding and
            pledging mortgage-backed securities and receivables, (ii) conveying
            or transferring all or any portion of the Companies' rights, title
            or interest in the Bonds to various entities including trusts and
            (iii) creating, acquiring, owning and selling residual interests in
            such entities.

            Results of Operations

            The Company and ABSC recorded no gains or (losses) on the sale of
            Bonds or beneficial interests in trusts for the nine months ended
            September 30, 1996 and September 30, 1995.

            For the nine months ended September 30, 1996 and 1995 the Company
            had no substantive transactions.

            General and administrative expenses include management fees,
            professional fees and other expenses.

            Liquidity and Capital Resources

            The Company and ABSC utilizes FBSC to facilitate the settlement of
            all transactions and invest all excess cash with FBSC. Such cash is
            available from FBSC on demand and does not earn interest. All gains
            and losses are recognized by FBSC on each transaction.


                                     Page 7


<PAGE>
                           PART II - OTHER INFORMATION

Item 1.      Legal Proceedings

             None.

Item 2.      Changes in Securities

             Not applicable.

Item 3.      Defaults Upon Senior Securities

             Not applicable.

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

                  (a)    Exhibits:

                         Indenture (incorporated by reference to Exhibit 1 of
                         Company's Form 8-K dated February 14, 1992 for Series
                         1992-1) dated as of January 1, 1987 as amended by
                         Amendment No. 1 dated as of April 30, 1987 and
                         Amendment No. 2 dated as of October 15, 1987, as
                         amended and restated as of August 1, 1988, between the
                         Company and State Street Bank and Trust Company, as
                         Trustee.

                         Articles of Incorporation of the Company as amended as
                         of January 7, 1986 (incorporated by reference to
                         Exhibit 3.1 of the Company's Form S-3 Registration
                         Statement dated January 31, 1985).

                         By-laws of the Company as amended and restated as of
                         January 7, 1986 (incorporated by reference to Exhibit
                         3.2 of the Company's Form S-3 Registration Statement
                         dated January 31, 1985).

                         Restated Certificate of Incorporation of Asset Backed
                         Securities Corporation (incorporated by reference to
                         Exhibit 3.1 of the Company's Form S-3 Registration
                         Statement (No. 0-14811)).


                                     Page 8


<PAGE>
Item 6.      Exhibits and Reports on Form 8-K (continued)

                         By-laws of Assets Backed Securities Corporation
                         (incorporated by reference to Exhibit 3.2 of the
                         Company's Form S-3 Registration Statement (No.
                         33-7382)).

                         Indenture, dated as of October 30, 1986, between Asset
                         Backed Securities Corporation and State Street Bank and
                         Trust Company, the Trustee (incorporated by reference
                         to Exhibit 1 of the Current Report on Form 8-K dated
                         October 30, 1986).

                  (b)    Reports on Form 8-K

                             None.



                                     Page 9


<PAGE>



                                    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.


                                            Collateralized Mortgage
                                            Securities Corporation


                                            By: /s/ THOMAS M. ZINGALLI
                                                -----------------------------
                                                Thomas M. Zingalli
                                                Controller and Principal
                                                  Accounting Officer
                                                (Duly Authorized Officer and
                                                Principal Accounting Officer)

Dated:  October 25, 1996











                                     Page 10


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                                INDEX TO EXHIBITS

Exhibit
Number            Description of Exhibit                                                         Page

<C>               <C>                                                                            <C>  
1                 Indenture dated as of January 1, 1987 as amended by
                  Amendment No. 1 dated as of April 30, 1987 and Amendment
                  No. 2 dated as of October 15, 1987, as amended and restated as
                  of August 1, 1988, between the Company and State Street Bank
                  and Trust Company, as Trustee.                                                 ****

1                 Indenture, dated as of October 30, 1986, between Asset Backed
                  Securities Corporation and State Street Bank and Trust Company,
                  as Trustee.                                                                      **

3.1               Articles of Incorporation of the Company as amended as of
                  January 7, 1986.                                                                  *

3.1               Restated Certificate of Incorporation of Asset Backed Securities
                  Corporation.                                                                    ***

3.2               By-Laws of the Company as amended and restated as of
                  January 7, 1986.                                                                  *

3.2               By-Laws of Asset Backed Securities Corporation.                                ****


 *       Incorporated by reference to the same Exhibits in Registration
         Statement No. 0-13156 on Form 10 filed with the Securities and Exchange
         Commission on January 31, 1985.

 **      Incorporated by reference to the same Exhibit in the Current Report
         on Form 8-K filed with the Securities and Exchange Commission on
         November 14, 1986.

 ***     Incorporated by reference to the same Exhibit in the Registration
         Statement No. 0-14811 of the Company's Form S-3 filed with the
         Securities and Exchange Commission on July 21, 1986.

 ****    Incorporated by reference to the same Exhibit in the Registration
         Statement No. 33-7382 of the Company's Form S-3 filed with the
         Securities and Exchange Commission on November 12, 1986.

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                                     Page 11