<PAGE> 1


==========================================================================


                                UNITED STATES
                     SECURITIES AND EXCHANGE COMMISSION
                           Washington, D.C. 20549

                                  FORM 10-K

[ X ]      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                      SECURITIES EXCHANGE ACT OF 1934

                   For the fiscal year ended June 30, 2000

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

           For the transition period from              to
                                           ----------     ----------
                      Commission File Number 001-12212

                       DRUMMOND FINANCIAL CORPORATION
           (Exact name of Registrant as specified in its charter)

            Delaware                                95-4426690
   (State or other jurisdiction of               (I.R.S. Employer
    incorporation or organization)              Identification  No.)

                 6 Rue Charles-Bonnet, 1206 Geneva, Switzerland
                    (Address of principal executive offices)

   Registrant's telephone number, including area code:  (41 22) 818 2999

     Securities registered pursuant to Section 12(b) of the Act:  None
       Securities registered pursuant to Section 12(g) of the Act:

                        Common Stock, $0.01 Par Value
                                (Title of Class)

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 by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained,
to the best of the Registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-K or any amendment to this Form 10-K.  [ X ]

The aggregate market value of the voting and non-voting common equity held
by non-affiliates of the Registrant was approximately $148,368 as of
September 25, 2000, computed on the basis of the closing price on such
date.

The number of shares outstanding of the Registrant's Common Stock as of
September 25, 2000 was 2,718,600.

                      DOCUMENTS INCORPORATED BY REFERENCE

Portions of the 2000 Proxy Statement to be filed within 120 days of the
fiscal year ended June 30, 2000 are incorporated by reference into Part
III.

==========================================================================


<PAGE> 2


FORWARD-LOOKING STATEMENTS

Statements in this report, to the extent that they are not based on
historical events, constitute forward-looking statements.  Forward-looking
statements include, without limitation, statements regarding the outlook
for future operations, forecasts of future costs and expenditures,
evaluation of market conditions, the outcome of legal proceedings, the
adequacy of reserves, or other business plans. Investors are cautioned
that forward-looking statements are subject to an inherent risk that
actual results may vary materially from those described herein.  Factors
that may result in such variance, in addition to those accompanying the
forward-looking statements, include changes in interest rates, prices, and
other economic conditions; actions by competitors; natural phenomena;
actions by government authorities; uncertainties associated with legal
proceedings; technological development; future decisions by management in
response to changing conditions; and misjudgments in the course of
preparing forward-looking statements.

                                     2


<PAGE> 3


                                TABLE OF CONTENTS
                                                                      PAGE
                                                                      ----

                                    PART I

ITEM 1.     BUSINESS                                                   4

ITEM 2.     PROPERTIES                                                 5

ITEM 3.     LEGAL PROCEEDINGS                                          5

ITEM 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS        5

                                    PART II

ITEM 5.     MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
            STOCKHOLDER MATTERS                                        6

ITEM 6.     SELECTED FINANCIAL DATA                                    7

ITEM 7.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS              8

ITEM 7A.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
            MARKET RISK                                               11

ITEM 8.     FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA               12

ITEM 9.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
            ACCOUNTING AND FINANCIAL DISCLOSURE                       12

                                  PART III

ITEM 10.    DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT        12

ITEM 11.    EXECUTIVE COMPENSATION                                    12

ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
            AND MANAGEMENT                                            13

ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS            13

                                  PART IV

ITEM 14.    EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND
            REPORTS ON FORM 8-K                                       14

SIGNATURES                                                            33


                                      3


<PAGE> 4


                                    PART I
ITEM 1.     BUSINESS

The Corporation

Drummond Financial Corporation was incorporated in June 1993 pursuant to
the laws of the State of Delaware and commenced operations in August 1993.
In October 1996, the Corporation changed its name from "CVD Financial
Corporation" to "Drummond Financial Corporation".

In this document, unless the context otherwise requires, the
"Corporation" refers to Drummond Financial Corporation and its
subsidiaries.

General

The Corporation operates in the financial services business
internationally, engaging primarily in merchant banking activities.  The
Corporation's merchant banking activities include seeking controlling
interests in businesses or assets which the Corporation believes are
undervalued. The Corporation was previously engaged in asset-based
commercial lending, which primarily involved the administration and
realization of an existing loan portfolio comprised of loans to emerging
companies.

During fiscal 1999, the Corporation collected $1.1 million from a
defaulting borrower and fully settled its loan portfolio. As at and from
June 30, 1999, the Corporation  had no loan commitments or finance
receivables.

The Corporation is focusing on expanding its merchant banking activities.
The Corporation is seeking controlling interests in businesses or
operating companies that generate or will potentially generate positive
cash flows from operations as opportunities arise.  The Corporation has
not identified any such opportunities as at the date hereof.  The
Corporation anticipates that substantial capital may be required to
further its merchant banking activities, and anticipates that such capital
will be provided from cash on hand, through the sale or exchange of
assets, or through debt or equity financing.  No assurance can be given
that any necessary capital will be available when required.

Competition

The Corporation competes against investment banks, merchant banks and
other investment managers for appropriate investments.  This business is
highly competitive and is subject to fluctuations based upon many factors
over which the Corporation has no control, such as the condition of public
markets, interest rates and the state of capital markets.  Many of the
Corporation's competitors are national or international companies with far
greater resources, capital and access to information than the Corporation.
As a result, the Corporation may become involved in transactions with more
risk than if it had greater resources.

                                      4

<PAGE> 5


While the Corporation has nominally competed with commercial banks,
leasing companies and asset-based lenders with respect to its asset-based
lending activities, its primary competitors have been venture capital
firms which also invest in emerging growth companies.

As at June 30, 2000, the Corporation had one employee.

ITEM 2.     PROPERTIES

The Corporation's corporate and administrative office is located in
Geneva, Switzerland and is leased.

ITEM 3.     LEGAL PROCEEDINGS

In February 1999, Gibralt Holdings Ltd. ("Gibralt") commenced proceedings
in Delaware Chancery Court seeking access to certain records of the
Corporation for the purpose of investigating alleged mismanagement.  In
May 1999, the Court granted Gibralt's application in part, allowing it
access to some records.  In September 1999, Gibralt commenced a putative
derivative action in Delaware Chancery Court naming the Corporation,
certain of its directors and officers and others as defendants.  The claim
has been filed in the form of a class action on behalf of shareholders,
but has not received Court certification as such.  Gibralt alleges that
the defendants have breached certain fiduciary duties, engaged in self-
dealing and failed in their disclosure obligations. The remedies sought by
Gibralt include, among other things, recovery of funds, judgment for
damages and certain other remedies that may be sought in the hearing of
the claim.  The Corporation believes Gibralt's claims to be entirely
without merit and intends to vigorously defend against the lawsuit.

The Corporation is involved in claims and matters of litigation arising in
the ordinary course of its business, including collection and related
actions concerning delinquent loans made by the Corporation.  The
Corporation does not believe that the outcome of such litigation will have
a material adverse effect on its business or financial condition.

ITEM 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Not applicable.

                                       5


<PAGE> 6

                                   PART II

ITEM 5.     MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
            STOCKHOLDER MATTERS

(a)  Market Information.  In March 1997, the Corporation's common stock
was listed and posted for trading on the Vancouver Stock Exchange (now
known as the Canadian Venture Exchange) under the trading symbol "DFC.U".
Since August 1995, the Corporation's common stock has been quoted on the
OTC Bulletin Board under the trading symbol "DFCU".

The following table sets forth the high and low sales prices per share of
the Corporation's common stock on the OTC Bulletin Board for the periods
indicated:

<TABLE>
<CAPTION>
Fiscal Quarter Ended                               High                Low
--------------------                               ----                ---
<S>                                                <C>                 <C>
1998
September 30                                       0.25               0.07
December 31                                        0.40               0.07

1999
March 31                                           0.31               0.19
June 30                                            0.31               0.16
September 30                                       0.34               0.16
December 31                                        0.37               0.25

2000
March 31                                           0.50               0.25
June 30                                            0.96               0.19
Period Ended September 25                          0.37               0.24
</TABLE>

(b)  Shareholders.  As of September 25, 2000, there were approximately 36
holders of record of the Corporation's common stock.

(c)  Dividends.  The Corporation has not paid any dividends on its common
stock and the directors do not contemplate the payment of such dividends.

                                          6


<PAGE> 7


ITEM 6.     SELECTED FINANCIAL DATA

The following table reflects selected consolidated financial data for the
Corporation for the last five fiscal years ended June 30, 2000.  The
information in the table was extracted from the more detailed consolidated
financial statements and related notes included herein and should be read
in conjunction with such financial statements and related notes.

<TABLE>
<CAPTION>
                                        Year Ended June 30,
                                ---------------------------------------
                                2000     1999     1998     1997    1996
                                ----     ----     ----     ----    ----
<S>                            <C>      <C>      <C>      <C>      <C>
                        (dollars in thousands, except per share amounts)
OPERATING DATA
Revenues                     $ 2,650  $ 2,297  $ 1,354  $ 4,253 $ 7,067
Expenses                       2,541    1,960    3,540    4,602   5,388
Income (loss) from
  continuing operations          108      336   (2,607)    (639)  1,678
Net income (loss)                108      336   (2,122)   2,338   1,791

COMMON SHARE DATA<F1>
Income (loss) from continuing
  operations per common share
                               (0.07)    0.01    (1.07)   (0.35)   0.62
Net income (loss) per
  common share                 (0.07)    0.01    (0.89)    0.74    0.66
Weighted average common shares
  outstanding (in thousands)   2,719    2,719    2,719    2,719   2,719

BALANCE SHEET DATA
Total assets                  26,000   25,999   29,535   31,560  48,310
Long-term obligations         21,515   21,515   21,515   23,002  42,047
Total stockholders' equity     3,079    3,271    3,235    5,657   3,641
-------------------
<FN>
<F1>
Basic and diluted common share data is the same.
</FN>

</TABLE>

                                      7


<PAGE> 8


ITEM 7.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
            CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of the financial condition and
results of operations of the Corporation for the three fiscal years ended
June 30, 2000 should be read in conjunction with the consolidated
financial statements and related notes included elsewhere herein.

Results of Operations

Year Ended June 30, 2000 Compared to the Year Ended June 30, 1999

Revenues for the year ended June 30, 2000 increased to $2.7 million from
$2.3 million for the year ended June 30, 1999, primarily as a result of a
net gain on sales of investments.  Revenues from interest and loan fees
increased slightly to $1.1 million for the year ended June 30, 2000 from
$1.0 million for the year ended June 30, 1999.  Revenues from dividends
and other activities were $0.3 million in the years ended June 30, 2000
and 1999.

Costs and expenses for the year ended June 30, 2000 increased to $2.5
million from $2.0 million for the year ended June 30, 1999, primarily as a
result of lower costs in 1999 resulting from recovery of credit loss in
the year. General and administrative expenses increased slightly to $1.2
million for the year ended June 30, 2000 from $1.1 million for the year
ended June 30, 1999.

Interest expense decreased to $1.3 million for the year ended June 30,
2000 from $2.0 million for the year ended June 30, 1999, primarily as a
result of a reduction in the interest rate on indebtedness. Interest on
the Corporation's long-term debt was accrued at the rate of approximately
5.65% per annum for the year ended June 30, 2000, compared to
approximately 8.63% per annum for the year ended June 30, 1999.

No income tax provision was recognized for the years ended June 30, 2000
and 1999, respectively, except for the payment of a minimum tax of $1,000.
The Corporation has deferred tax benefits with respect to net operating
loss carry-forwards which have not been recognized as there is no
assurance that they will be realized.

Net income for the year ended June 30, 2000 was $0.1 million, or $0.07
loss per common share, compared to a net income of $0.3 million, or $0.01
per common share, for the year ended June 30, 1999.

                                      8


<PAGE> 9


Year Ended June 30, 1999 Compared to the Year Ended June 30, 1998

Revenues for the year ended June 30, 1999 increased to $2.3 million from
$1.4 million for the year ended June 30, 1998, primarily as a result of a
net gain on sales of investments.  Revenues from interest and loan fees
decreased to $1.0 million for the year ended June 30, 1999 from $1.4
million for the year ended June 30, 1998, primarily as a result of a
reduction in the dollar amount of outstanding performing loans.  Revenues
from dividends and other activities were $0.3 million in the year ended
June 30, 1999, compared to $0.5 million in the year ended June 30, 1998.

Costs and expenses for the year ended June 30, 1999 decreased to $2.0
million from $3.5 million for the year ended June 30, 1998, primarily as a
result of a recovery of credit losses of $1.1 million during the current
period relating to amounts outstanding under a non-performing loan. The
Corporation recovered credit losses of $0.4 million in the year ended June
30, 1998. General and administrative expenses decreased to $1.1 million
for the year ended June 30, 1999 from $1.4 million for the year ended June
30, 1998, primarily as a result of decreased professional fees and loan
collection costs.

Interest expense decreased to $2.0 million for the year ended June 30,
1999 from $2.5 million for the year ended June 30, 1998, primarily as a
result of a reduction in indebtedness. Interest on the Corporation's long-
term debt was accrued at the rate of approximately 8.63% per annum for the
year ended June 30, 1999, compared to approximately 8.50% per annum for
the year ended June 30, 1998.

No income tax provision was recognized for the years ended June 30, 1999
and 1998, respectively, except for the payment of a minimum tax of $1,000.
The Corporation has deferred tax benefits with respect to net operating
loss carry-forwards which have not been recognized as there is no
assurance that they will be realized.

Net income for the year ended June 30, 1999 was $0.3 million, or $0.01 per
share, compared to a net loss of $2.1 million, or $0.89 per share, for the
year ended June 30, 1998.  The Corporation's results of operations for the
year ended June 30, 1998 included a gain of $0.5 million, or $0.18 per
share, on the extinguishment of debt.

Liquidity and Capital Resources

The Corporation's cash and cash equivalents at June 30, 2000 were $6.2
million, an increase of $2.0 million from June 30, 1999.

                                      9


<PAGE> 10


Cash provided by operating activities for the year ended June 30, 2000 was
$4.3 million, compared to $1.4 million used in the year ended June 30,
1999.  Cash used by operating activities before activities in trading
securities was $0.8 million in the year ended June 30, 2000, compared to
$5.4 million in the year ended June 30, 1999.  A decrease in accounts
payable and accrued liabilities used cash of $81,000 in the year ended
June 30, 2000, compared to $0.6 million in the year ended June 30, 1999.
An increase in receivables used cash of $0.7 million in the year ended
June 30, 2000, compared to $0.4 million in the year ended June 30, 1999.
Repayment of a loan from an affiliate provided cash of $0.9 million in the
year ended June 30, 2000.  Net sales of trading securities provided cash
of $5.0 million in the year ended June 30, 2000, compared to $4.1 million
in the year ended June 30, 1999.

Investing activities for the year ended June 30, 2000 used cash of $2.1
million, compared to $4.8 million provided for the year ended June 30,
1999.  Collections on loan receivables provided cash of $1.1 million in
the year ended June 30, 1999.  No new loans were made since June 30, 1999.
In the year ended June 30, 2000, a net increase in notes receivable used
cash of $2.1 million, compared to a net decrease in same providing cash of
$3.6 million in the year ended June 30, 1999.

Financing activities for the year ended June 30, 2000 used cash of $0.3
million, as a result of the payment of dividends on preferred shares.  For
the year ended June 30, 1999, financing activities used cash of $2.8
million, primarily as a result of partial repayment of an outstanding
loan.

During the year ended June 30, 2000, the Corporation entered into a debt
restructuring agreement with MFC Bancorp Ltd. whereby interest on a
promissory note was reduced from 8.75% to 5% per annum and the promissory
note was secured by way of a general security agreement and securities
pledge agreement on the assets of the Corporation.

The Corporation anticipates that its cash, investments on hand and
interest income will be sufficient to service the Corporation's debt costs
and cover the day-to-day general and administrative expenses of the
Corporation during the short-term.

Finance Receivables

The Corporation fully settled its loan portfolio during fiscal 1999 and
since then it has had no loan commitments or finance receivables
(principal plus interest and reimbursable costs less unamortized
commitment fees).

Year 2000

The Corporation did not experience any difficulties associated with the
changeover to the year 2000.  While management of the Corporation believes
that it took adequate steps to address the year 2000 issue, and are not
aware of any difficulties experienced by the Corporation's clients
associated with the changeover to the year 2000, there can be no assurance
that difficulties associated with the year 2000 may not arise in the
future.

                                     10


<PAGE> 11


ITEM 7A.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
            MARKET RISK

The Corporation is exposed to market risks from changes in interest rates
and equity prices which may affect its results of operations and financial
condition. The Corporation manages these risks through internal risk
management policies.  The Corporation does not enter into derivative
contracts for its own account to hedge against these risks.

Interest Rate Risk

Fluctuations in interest rates may affect the fair value of financial
instruments sensitive to interest rates. An increase in interest rates may
decrease the fair value and a decrease in interest rates may increase the
fair value of such financial instruments. The Corporation's financial
instruments which may be sensitive to interest rate fluctuations are
investments, note receivable and debt obligations. The following table
provides information about the Corporation's exposure to interest rate
fluctuations for the carrying amount of financial instruments that may be
sensitive to such fluctuations as at June 30, 2000 and 1999 and expected
cash flows from these instruments:

Year ended June 30, 2000

<TABLE>
<CAPTION>
                                        Expected Future Cash Flow
                                        -------------------------
                    Carrying  Fair
                     Value    Value      2001     2002   2003    2004    2005
    Thereafter                    --------  -----      ----     ----   ----    ----    ----    ----------
<S>                 <C>        <C>    <C>      <C>    <C>     <C>     <C>     <C>
                                             (in thousands)
Investments<F1>     $ 9,371   $ 9,371 $ 3,371    $  -  $  -   $  -   $  -      $ 6,000
Notes receivable      6,689     6,689   6,689       -     -      -      -           -
Debt obligations<F2> 21,515    21,515       -       -     -      -      -     21,515
----------
<FN>
<F1>
Investments consist of debt securities and fixed yield securities.

<F2>
Debt obligations consist of a promissory note bearing interest at
5.00% per annum and maturing on July 31, 2008.
</FN>

</TABLE>

Year ended June 30, 1999

<TABLE>
<CAPTION>
                                      Expected Future Cash Flow
                                      -------------------------
                   Carrying    Fair
                     Value     Value      2000  2001    2002    2003    2004
Thereafter
                   --------    -----      ----  ----    ----    ----    ----
----------
<S>                <C>        <C>       <C>     <C>     <C>     <C>     <C>
<C>
                                            (in thousands)
Investments<F1>     $ 7,775   $ 7,775  $ 1,775  $  -   $  -   $  -   $  -
$    6,000
Notes receivable      4,617     4,617    4,617     -      -      -      -
         -
Debt obligations<F2> 21,515    21,515        -     -      -      -      -
     21,515
-----------
<FN>
<F1>   Investments consist of debt securities and fixed yield securities.
<F2>   Debt obligations consist of a promissory note bearing interest at
       8.75% per annum and maturing on July 31, 2008.
</FN>

</TABLE>

Equity Price Risk

Changes in trading prices of equity securities may affect the fair value
of equity securities.  An increase in trading prices will increase the
fair value and a decrease in trading prices will decrease the fair value
of equity securities. The Corporation's financial instruments which may be
sensitive

                                        11


<PAGE> 12


to fluctuations in equity prices are investments. The following table
provides information about the Corporation's exposure to fluctuations in
equity prices for the carrying amount of financial instruments sensitive
to such fluctuations and expected cash flows from these instruments:

Year ended June 30, 2000

<TABLE>
<CAPTION>

                                   Expected Future Cash Flow
                                   -------------------------
               Carrying    Fair
                 Value     Value      2001    2002    2003    2004    2005
 Thereafter
               --------    -----      ----    ----    ----    ----    ----
----------
<S>            <C>        <C>         <C>     <C>     <C>     <C>     <C>
<C>
                                        (in thousands)
Investments<F1> $ 1,701  $ 1,701   $ 1,701    $  -   $  -   $  -   $  -   $
         -
----------
<FN>
<F1>
Investments consist of equity securities.
</FN>

</TABLE>

Year ended June 30, 1999

<TABLE>
<CAPTION>
                                  Expected Future Cash Flow
                                  -------------------------
               Carrying    Fair
                 Value     Value      2000    2001    2002    2003    2004
Thereafter
               --------    -----      ----    ----    ----    ----    ----
 ----------
<S>            <C>         <C>        <C>    <C>     <C>      <C>     <C>
<C>
                                        (in thousands)
Investments<F1> $ 4,397  $ 4,397   $ 4,397    $  -   $  -   $  -   $  -   $
         -
----------
<FN>
<F1>
Investments consist of equity securities.
</FN>

</TABLE>

ITEM 8.     FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The consolidated financial statements and supplementary data required
pursuant to this Item 8, and as listed in Item 14 of this annual report,
are included in this annual report commencing on page 16.

ITEM 9.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
            ACCOUNTING AND FINANCIAL DISCLOSURE

Not applicable.

                                  PART III

ITEM 10.     DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Incorporated by reference from the Registrant's definitive proxy statement
to be filed within 120 days of the end of the Registrant's fiscal year.

ITEM 11.     EXECUTIVE COMPENSATION

Incorporated by reference from the Registrant's definitive proxy statement
to be filed within 120 days of the end of the Registrant's fiscal year.

                                      12


<PAGE> 13


ITEM 12.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
             AND MANAGEMENT

Incorporated by reference from the Registrant's definitive proxy statement
to be filed within 120 days of the end of the Registrant's fiscal year.

ITEM 13.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Incorporated by reference from the Registrant's definitive proxy statement
to be filed within 120 days of the end of the Registrant's fiscal year.

                                      13


<PAGE> 14


                                      PART IV

ITEM 14.     EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND
             REPORTS ON FORM 8-K

(a)     (1)     Index to Financial Statements

                Independent Auditors' Report
                Consolidated Balance Sheet
                Consolidated Statement of Operations
                Consolidated Statement of Cash Flows
                Consolidated Statement of Shareholders' Equity
                Notes to the Consolidated Financial Statements

        (2)     Financial Statement Schedules

                None.

        (3)     Exhibits

                2.1  Arrangement Agreement among Drummond Financial
                     (B.C.) Ltd., MFC Bancorp Ltd. and Drummond Financial
                     Corporation dated February 23, 1998. Incorporated by
                     reference to Form T-3 of MFC Bancorp Ltd. dated March
                     2, 1998.
                2.2  Amendment Agreement among Drummond Financial (B.C.)
                     Ltd., MFC Bancorp Ltd. and Drummond Financial
                     Corporation dated March 23, 1998. Incorporated by
                     reference to Form 10-KSB dated September 28, 1998.
                3.1  Certificate of Incorporation dated June 1, 1993.
                     Incorporated by reference to Form S-1 filed June 7,
                     1993.
                3.2  Certificate of Designations dated July 19, 1996.
                     Incorporated by reference to Form 10-KSB dated
                     September 20, 1996.
                3.3  Certificate of Amendment to the Certificate of
                     Incorporation of Drummond Financial Corporation dated
                     October 14, 1996. Incorporated by reference to Form
                     10-QSB dated November 11, 1996.
                3.4  Bylaws.  Incorporated by reference to Form S-1 filed
                     June 7, 1993.
                3.5  Amendment to the Bylaws adopted as of July 20, 1993.
                     Incorporated by reference to Amendment No. 1 to Form
                     S-1 filed July 26, 1993.
                4.1  Form of Indenture between CVD Financial Corporation
                     and Harris Trust Company of New York, as Trustee.
                     Incorporated by reference to Form S-1 filed June 7,
                     1993.
                4.2  Second Supplemental Indenture between Drummond
                     Financial Corporation and Harris Trust Company of New
                     York, as Trustee, dated for reference October 23,
                     1996.  Incorporated by reference to Form 10-QSB dated
                     November 11, 1996.

                                      14


<PAGE> 15


                4.3  Third Supplemental Indenture among Drummond Financial
                     Corporation, Harris Trust Company of New York and The
                     Bank of Nova Scotia Trust Company of New York dated
                     for reference May 13, 1997.  Incorporated by
                     reference to Form 10-KSB dated September 24, 1997.
                4.4  Fourth Supplemental Indenture among Drummond
                     Financial Corporation, The Bank of Nova Scotia Trust
                     Company of New York and Drummond Financial (B.C.)
                     Ltd. dated for reference February 4, 1998.
                     Incorporated by reference to Form10-KSB dated
                     September 28, 1998.
               10.1  1993 Stock Option Plan.  Incorporated by
                     reference to Form S-1 filed June 7, 1993.
               10.2  Profit Sharing Plan.  Incorporated by reference to
                     Amendment No. 1 to Form S-1 filed July 26, 1993.
               10.3  Debt Restructuring Agreement between MFC Bancorp Ltd.
                     and Drummond Financial Corporation dated August 30,
                     1999.  Incorporated by reference to Form 10-K dated
                     September 24, 1999.
               21    List of subsidiaries of the Registrant.
               27    Article 5 - Financial Data Schedule for year ended
                     June 30, 2000 - Form 10-K.

(b)     Reports on Form 8-K

None.


                                      15


<PAGE> 16


                        DRUMMOND FINANCIAL CORPORATION


                       CONSOLIDATED FINANCIAL STATEMENTS


                                JUNE 30, 2000


                                      16


<PAGE> 17


                          INDEPENDENT AUDITORS' REPORT





To the Shareholders of
Drummond Financial Corporation


We have audited the consolidated balance sheets of Drummond Financial
Corporation as at June 30, 2000 and 1999 and the related consolidated
statements of operations, cash flows and shareholders' equity for the
years ended June 30, 2000, 1999 and 1998.  These consolidated financial
statements are the responsibility of the Company's management.  Our
responsibility is to express an opinion on these consolidated financial
statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards in the United States of America.  Those standards require that
we plan and perform an audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.  An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements.  An audit also includes assessing
the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation.  We believe that our audits provide a reasonable basis for
our opinion.

In our opinion, these consolidated financial statements present fairly, in
all material respects, the financial position of the Company as at June
30, 2000 and 1999 and the results of its operations and cash flows for the
years ended June 30, 2000, 1999 and 1998 in accordance with generally
accepted accounting principles in the United States of America.



                                                    Davidson & Company
Vancouver, Canada                                   Chartered Accountants

September 18, 2000

                                      17


<PAGE> 18


DRUMMOND FINANCIAL CORPORATION
CONSOLIDATED BALANCE SHEETS
(Dollars stated in thousands)
AS AT JUNE 30
<TABLE>
<CAPTION>

==========================================================================

                                                          2000        1999
--------------------------------------------------------------------------
<S>                                                  <C>              <C>

ASSETS

Cash and cash equivalents                            $   6,238   $   4,280

Other receivables (Note 5)                               9,508       5,450

Due from affiliates                                          -       3,080

Investments (Note 6)                                     9,371      12,172

Deferred debt issuance costs, net of accumulated
  amortization of $730 (1999 - $597)                       883       1,017
                                                     ---------   ---------
                                                     $  26,000   $  25,999
==========================================================================


LIABILITIES AND SHAREHOLDERS' EQUITY

Accounts payable and accrued liabilities            $      50   $     131

Interest payable                                        1,207         933

Accrued dividends payable                                 149         149

Debt (Note 8)                                          21,515      21,515
                                                    ---------   ---------
                                                       22,921      22,728
                                                    ---------   ---------
Shareholders' equity (Note 9)
   Capital stock
      Preferred stock, $0.01 par value
         5,000,000 shares authorized
         3,000,000 shares issued and outstanding
           at June 30, 2000 and 1999                       30          30
   Additional paid-in capital                           5,970       5,970
                                                    ---------   ---------
                                                        6,000       6,000
                                                    ---------   ---------
   Common stock, $0.01 par value
      10,000,000 shares authorized
      2,718,600 shares issued and outstanding at
        June 30, 2000 and 1999                             27          27
   Additional paid-in capital                          14,727      14,727
                                                    ---------   ---------
                                                       14,754      14,754

Deficit                                               (17,675)    (17,483)
                                                    ---------   ---------
                                                        3,079       3,271
                                                    ---------   ---------
                                                    $  26,000   $  25,999
==========================================================================
</TABLE>

   The accompanying notes are an integral part of these consolidated
                           financial statements.

                                       18


<PAGE> 19


DRUMMOND FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars stated in thousands; except per share amounts)
YEAR ENDED JUNE 30
<TABLE>
<CAPTION>

========================================================================
                                       2000           1999          1998
------------------------------------------------------------------------
<S>                                    <C>             <C>           <C>

REVENUE
   Interest and loan fees        $    1,075     $      993    $    1,405
   (Loss) gain on investments,
     net                              1,272          1,004          (507)
   Dividend income                      300            300           300
   Other                                  3              -           156
                                 ----------     ----------    ----------
                                      2,650          2,297         1,354
                                 ----------     ----------    ----------
COST AND EXPENSES
   Interest                           1,349          2,029         2,470
   Recovery of credit losses              -         (1,139)         (360)
   General and administrative         1,192          1,070         1,430
                                 ----------     ----------    ----------
                                      2,541          1,960         3,540
                                 ----------     ----------    ----------
Equity in loss of investee                -              -          (420)
                                 ----------     ----------    ----------
Income (loss) from operations           109            337        (2,606)

Income tax expense                       (1)            (1)           (1)
                                 ----------     ----------    ----------
Income (loss)  before
  extraordinary gain                    108            336        (2,607)

Extraordinary gain on early
  extinguishment of debt,
    net of $Nil provision for
    income taxes for 2000, 1999
    and 1998                              -              -           485
                                 ----------     ----------    ----------
Net income (loss) for the year   $      108     $      336    $   (2,122)
========================================================================

Basic earnings (loss) per share
  Income (loss) before
    extraordinary gain           $    (0.07)    $     0.01    $    (1.07)
  Extraordinary gain                      -              -          0.18
                                 ----------     ----------    ----------
                                 $    (0.07)    $     0.01    $    (0.89)
========================================================================

Weighted average number of
  shares outstanding              2,718,600      2,718,600     2,718,600
========================================================================

</TABLE>

    The accompanying notes are an integral part of these consolidated
                            financial statements.

                                      19


<PAGE> 20


DRUMMOND FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars stated in thousands)
YEAR ENDED JUNE 30
<TABLE>
<CAPTION>

=========================================================================
                                       2000           1999           1998
-------------------------------------------------------------------------
<S>                                    <C>            <C>            <C>


CASH FLOWS FROM OPERATING ACTIVITIES:

   Net income (loss) for the
     year                         $     108     $     336      $   (2,122)
   Adjustments to reconcile income
     (loss) to cash from operating
     activities:
     Extraordinary gain on early
       extinguishments of debt            -             -            (485)
     Loss (gain) on investments,
       net                           (1,272)       (1,004)            507
     Recovery of credit losses            -        (1,139)           (360)
     Equity loss of investee              -             -             420
     Amortization of deferred debt
       issuance costs                   134           134             138

   Changes in non-cash working
     capital balances:
     Interest receivable               (576)            -             976
     Commitment fees                      -             -             (25)
     Other receivable                  (168)         (407)         (1,605)
     Due from affiliate                 860        (2,300)           (239)
     Interest payable                   274          (416)            438
     Accounts payable and accrued
       liabilities                      (81)         (630)         (1,277)
     Other                                6             -               3
                                  ---------     ---------       ---------
                                       (715)       (5,426)         (3,631)

   Purchase of trading securities      (328)       (4,405)        (10,500)
   Proceeds from sales of trading
     securities                      5 ,373         8,480           6,197
                                  ---------     ---------       ---------
   Net cash provided by (used in)
     operating activities             4,330        (1,351)         (7,934)
                                  ---------     ---------       ---------

CASH FLOWS FROM INVESTING ACTIVITIES:

   Advances on loans                      -             -          (9,700)
   Payments collected on loans            -         1,139          17,407
   Decrease (increase) in notes
     receivable, net                 (2,072)        3,619          (3,407)
                                  ---------     ---------       ---------
   Net cash provided by (used in)
     investing activities            (2,072)        4,758           4,300
                                  ---------     ---------       ---------
</TABLE>

     The accompanying notes are an integral part of these consolidated
                             financial statements.

                                      20


<PAGE> 21


DRUMMOND FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
(Dollars stated in thousands)
YEAR ENDED JUNE 30
<TABLE>
<CAPTION>

=========================================================================
                                         2000          1999          1998
-------------------------------------------------------------------------
<S>                                      <C>           <C>           <C>

CASH FLOWS FROM FINANCING ACTIVITIES:

  Note payable, net                 $       -      $ (2,526)     $  7,000
  Purchase of treasury bond payable         -             -          (992)
  Dividends paid on preferred shares     (300)         (300)         (300)
                                    ---------     ---------     ---------
  Net cash provided by (used in)
    financing activities                 (300)       (2,826)        5,708
                                    ---------     ---------     ---------

Increase in cash and cash
  equivalents for the year              1,958           581         2,074


Cash and cash equivalents,
  beginning of year                     4,280         3,699         1,625
                                    ---------      --------      --------

Cash and cash equivalents,
  end of year                       $   6,238      $  4,280      $  3,699
=========================================================================

Cash paid during the year for:

  Interest expense                  $     941      $  2,311      $  1,915
  Income taxes                              1             1             1
=========================================================================
</TABLE>

Supplemental disclosure with respect to non-cash investing and financing
activities (Note 15)


      The accompanying notes are an integral part of these consolidated
                           financial statements.

                                      21


<PAGE> 22>

DRUMMOND FINANCIAL CORPORATION
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
(Dollars stated in thousands)
<TABLE>
<CAPTION>

=========================================================================
         Preferred Stock                      Common Stock
         ---------------                      ------------

Total
                                 Additional                     Additional
Accum-
Share-
            Number                Paid-in      Number             Paid-in
lated   Treasury
holders
            of Shares   Amount    Capital   of Shares   Amount   Capital
Deficit   Stock
Equity
            ---------   ------  ----------  ---------   ------  ----------
-------  -------- -
-------
<S>         <C>         <C>     <C>         <C>         <C>     <C>
<C>      <C>
<C>
Balance at
  June 30,
  1997      3,000,000   $   30   $  5,970  4,264,000  $    43  $  17,767
$(15,097) $(3,056) $  5,657

Net loss for
  the year          -        -           -          -       -          -
(2,122)       -   (2,122)

            ---------  -------  ---------   --------  -------  ---------
-------- --------
Dividends
  paid and
  payable           -        -          -          -        -          -
(300)       -      (300)
           ----------  -------  ---------  ---------  -------  ---------
-------- --------  --------
Balance at
  June 30,
  1998      3,000,000       30      5,970  4,264,000       43     17,767
(17,519)  (3,056)    3,235

Net income
  for the
  year              -        -          -          -        -          -
336        -       336

Retirement
  of treasury
  stock             -        -          -  (1,545,400)    (16)    (3,040)
-     3,056        -

Dividends
  paid and
  payable           -        -          -           -       -          -
(300)       -      (300)
           ----------  -------  ---------  ----------  ------  ---------
-------- --------  --------

Balance at
  June 30,
  1999      3,000,000       30      5,970   2,718,600      27     14,727
(17,483)       -     3,271

Net income
  for the
  year              -        -          -           -       -          -
108        -       108

Dividends
  paid and
  payable           -        -          -           -       -          -
(300)       -      (300)
           ----------  -------  ---------  ----------  ------  ---------
-------- --------  --------

Balance
  at June 30,
  2000      3,000,000  $    30  $   5,970   2,718,600  $   27  $  14,727
$ (17,675) $    -  $   3,079
         ========  =====  =======  =======  ====  =======  ======= =====
=======
</TABLE>


    The accompanying notes are an integral part of these consolidated
                              financial statements.

                                      22


<PAGE> 23


DRUMMOND FINANCIAL CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in tables stated in thousands)
JUNE 30, 2000

==========================================================================

1.     NATURE OF OPERATIONS

Drummond Financial Corporation (the "Company"), a Delaware corporation,
was formed in June 1993.  In August 1993, the Company completed an initial
public offering of common stock concurrent with a debenture offering.

The Company presently operates in the financial services industry, which
is comprised of investment and merchant banking activities and asset-based
commercial lending.  The merchant banking activities are expected to
include the acquisition of controlling interests in businesses or assets
which the Company believes are under-valued.  The asset-based commercial
lending primarily involves the administration and realization of an
existing loan portfolio comprised of loans to emerging companies. The
Company now focuses on investment and merchant banking activities while
de-emphasizing asset-based commercial lending.


2.     BASIS OF PRESENTATION

These consolidated financial statements have been prepared by management
in conformity with generally accepted accounting principles applicable in
the United States of America, and are stated in United States dollars.


3.     SIGNIFICANT ACCOUNTING POLICIES


In preparing these financial statements, management is required to make
estimates and assumptions that affect the reported amounts of assets and
liabilities as of the date of the balance sheet and revenues and expenses
for the year.  Actual results in future periods could be different from
these estimates made in the current year.  The following is a summary of
the significant accounting policies of the Company:


Basis of consolidation

These consolidated financial statements included the accounts of the
Company and its subsidiaries.  Significant inter-company accounts and
transactions have been eliminated.


Cash and cash equivalents

Cash equivalents consist of highly liquid investments with an original
maturity of three months or less.  These are recorded at cost which
approximates fair value based on the reported market value.  Occasionally,
the Company maintains cash balances at foreign financial institutions in
excess of insured limits.


Financial instruments

The Company's financial instruments consist of cash and cash equivalents,
other receivables, due from affiliates, investments,  accounts payable and
accrued liabilities, interest payable, note payable, accrued dividends
payable and debt.  Unless otherwise noted, it is management's opinion that
the Company is not exposed to significant interest, currency or credit
risks arising from these financial instruments.  The fair value of these
financial instruments approximate their carrying value, unless otherwise
noted.

                                      23


<PAGE> 24


DRUMMOND FINANCIAL CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in tables stated in thousands)
JUNE 30, 2000

==========================================================================

3.     SIGNIFICANT ACCOUNTING POLICIES (continued.....)


Finance receivables and allowance for credit losses

Finance receivables, also known as recorded investments in loans, include
the outstanding loan balance (net of any charge-offs), accrued interest,
reimbursable expenses and are net of deferred loan fees.

The Company maintains an allowance for credit losses at an amount
estimated to cover potential losses on finance receivables which have
experienced an event of impairment or for which future collection of
outstanding principal, interest and reimbursable expenses has become
doubtful. Amounts deemed to be uncollectible are charged off against the
allowance and subsequent recoveries, if any, are credited to the
allowance.  The amount of the allowance is based on the Company's
evaluation of numerous factors, including the adequacy of the collateral
securing the loans, the operating environments of the various borrowers
and the historical experience of the various borrowers' management, and
reflect the Company's best estimate of the necessary level of the
allowance for credit losses.

Under the provisions of Financial Accounting Standards Board ("FASB")
Statement No. 114, "Accounting by Creditors for Impairment of a Loan",
when a loan is impaired as defined in the statement, a lender shall
measure impairment at the present value of expected future cash flows
discounted at the loan's effective interest rate, or as a practical
expedient, based on a loan's observable market price or the fair value of
the collateral if the loan is collateral dependent.  The Company has
adopted a measurement method on a loan-by-loan basis.   By definition, the
Company's non-performing loans are impaired.  A specific reserve is
established for each impaired loan equal to the amount by which the
Company's recorded investment in the loan exceeds the net present value of
the loan determined in accordance with FASB Statement No. 114.

The Company continues to apply FASB Statement No. 5 "Accounting for
Contingencies" to provide an allowance on a pool of unimpaired loans.

Investments

The Company's available-for-sale and trading securities are stated at
their fair values.  Any unrealized holding gains or losses of available-
for-sale securities are excluded from earnings and reported as a separate
component of shareholders' equity until realized.  If a loss in value in
available-for-sale securities is considered to be other than temporary, it
is recognized in the determination of net income.  Gains and losses on
trading securities are included in earnings.  Cost is based on the
specific identification method to determine realized gains or losses.

Warrants to acquire common stock of the various borrowers held by the
Company for which a readily determinable fair market value is available
and the Company has an unrestricted right to sell the warrant and/or
underlying securities within one year are included in trading securities.

Investments in other companies where control is temporary or ownership is
less than 20% are carried using the cost method of accounting.  The
Company accounts for its investments in companies where the ownership is
20% or more under the equity method.

Deferred debt issuance costs

Deferred debt issuance costs consist of underwriter's fees and expenses
and other costs capitalized in connection with the Company's August 1993
debt offering.  These costs are being amortized on a straight-line basis
which approximates the interest method over the term of the related debt.
The amortization is included in interest expense.

                                     24


<PAGE> 25


DRUMMOND FINANCIAL CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in tables stated in thousands)
JUNE 30, 2000

==========================================================================

3.     SIGNIFICANT ACCOUNTING POLICIES (continued.....)

Revenue recognition

Revenue consists principally of interest income from finance receivables,
other receivables, temporary investments of cash and cash equivalents, and
amortization of loan commitment fees, net of related costs, received in
connection with the making of loans, as well as sales of trading
securities.  Interest income is recognized when earned using the interest
method.  The Company, as a general policy, suspends the recognition of
income on loans which are more than 90 days contractually delinquent or
earlier if the Company has material evidence of the borrower's inability
to meet its commitments under the loan agreement (e.g. the borrower files
for bankruptcy protection).  The recognition of income is generally
resumed, and suspended income is recognized as interest revenue, when the
loan becomes contractually current or collection of suspended amounts is
assured.  Loan commitment fees, net of related costs, are deferred and
recognized over the term of the loan using the interest method.  For
delinquent loans, amortization of the corresponding net loan commitment
fees is suspended and subsequently resumed concurrently with  the related
recognition of interest income.

Income taxes

Certain revenue and expense items, primarily related to the allowance for
credit losses, are accounted for in different time periods for financial
reporting purposes as compared to income tax reporting purposes.  Deferred
taxes are recognized using the liability method, and tax rates are applied
to cumulative temporary differences based on when and how they are
expected to be included for income tax reporting purposes.  Valuation
allowances are established, when necessary, to reduce deferred tax assets
to the amount which management believes is more likely than not to be
realized.

Earnings per share

Basic earnings per share is computed by dividing income available to
common shareholders by the weighted average number of common shares
outstanding in the period.  Diluted earnings per share takes into
consideration common shares outstanding (computed under basic earnings per
share) and potentially dilutive common shares.

Warrants and options were not included in the computation of diluted
earnings (loss) per share for the fiscal years  because their exercise
prices was greater than their market prices.  There were no warrants nor
options outstanding in the fiscal years 2000 and 1999.

Stock-based compensation

FASB Statement No. 123, "Accounting for Stock-Based Compensation",
encourages, but does not require, companies to record compensation cost
for stock-based employee compensation plans at fair value.  The Company
has chosen to account for stock-based compensation using Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to
Employees".  Accordingly, compensation cost for stock options is measured
as the excess, if any, of the quoted market price of the Company's stock
at the date of the grant over the amount an employee is required to pay
for the stock.

Comprehensive income

In June 1997, the FASB issued Statement No. 130 "Reporting Comprehensive
Income", which establishes standards for the reporting and display of
comprehensive income and its components (revenues, expenses, gains and
losses).  The purpose of reporting comprehensive income is to present a
measure of all changes in shareholders' equity other than transactions
with owners in their capacity as owners.  The Company does not have any
other comprehensive income during the years ended June 30, 2000, 1999 and
1998.

Comparative figures

Certain comparative figures have been reclassified to conform with the
current year's presentation.

                                     25


<PAGE> 26


DRUMMOND FINANCIAL CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in tables stated in thousands)
JUNE 30, 2000

==========================================================================
4.     FINANCE RECEIVABLES

The Company engages in the asset-based commercial lending business.
Generally, loans are due over periods of one to five years and are
collateralized by security agreements on various types of equipment,
commercial real estate, borrowers' eligible accounts receivable and
inventory and other tangible assets.  The loans generally earn interest at
a major bank's (the "Bank") prime rate plus two to seven percent.  The
Company did not have any finance receivables outstanding as at June 30,
2000 and 1999.

The Company has established allowances for credit losses at June 30, 1999
and 1998 as follows:

<TABLE>
<CAPTION>
==========================================================================
                                               1999                  1998
--------------------------------------------------------------------------
<S>                                            <C>                   <C>

Balance, beginning of year                $   2,100             $   3,293
Recovery for the year                        (1,139)                 (360)
Charge-offs for the year, net                  (961)                 (833)
                                          ---------             ---------
Balance, end of year                      $       -             $   2,100
==========================================================================
</TABLE>

At June 30, 2000 and 1999, the Company does not have any unfunded loan
commitments.


5.     OTHER RECEIVABLES

<TABLE>
<CAPTION>
==========================================================================
                                               2000                  1999
--------------------------------------------------------------------------
<S>                                            <C>                   <C>

Notes receivable                          $   6,689             $   4,617
Accrued dividend receivable                     149                   149
Other receivables                             2,670                   684
                                          ---------             ---------
                                          $   9,508             $   5,450
==========================================================================
</TABLE>
The carrying  amount of the receivables approximates their fair value
which is based on the discounted present value of their estimated future
cash flows.


6.	INVESTMENTS

<TABLE>
<CAPTION>
==========================================================================
                                               2000                  1999
--------------------------------------------------------------------------
<S>                                            <C>                   <C>

Trading securities:
  Bonds and debentures                    $   1,670             $   1,775
  Equity securities                           1,701                 4,397
                                          ---------             ---------
                                              3,371                 6,172
Available-for-sale security                   6,000                 6,000
                                          ---------             ---------
                                          $   9,371             $  12,172
=========================================================================
</TABLE>

                                     26


<PAGE> 27

DRUMMOND FINANCIAL CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in tables stated in thousands)
JUNE 30, 2000


==========================================================================

6.     INVESTMENTS (continued...)

For the year ended June 30, 2000, the Company recognized an unrealized
holding loss of $40,000 (1999 - $272,000 gain; 1998 - $186,000 loss) and a
realized loss of $846,000 (1999 - $732,000 gain; 1998 - $321,000 loss) on
sales of trading securities.

Available-for-sale  securities consist of preferred shares in an
affiliate. The preferred shares are stated at cost of $6,000,000 at June
30, 2000 and 1999 because there is no ready market for the shares.  The
carrying amount approximates their fair value which is based on their
retractibility feature and dividend rate compared to market rate.


7.     INVESTMENT - AT EQUITY

As at June 30, 1998, the Company's investment was comprised of 1,070,320
shares of Ichor Corporation which represented 21.81% of the total
outstanding shares.  The Company has accounted for its investment using
the equity method of accounting.  During 1999, the Company sold the
investment to an affiliate for consideration of 94% of the proceeds from
the future sales by the affiliate of all or part of the investment on or
before December 31, 2003.  During 2000, 779,435 shares of Ichor
Corporation were sold for an accounting gain of $2,158,000.


8.     DEBT

Under an indenture dated August 26, 1993 (the "Master Indenture") the
Company was authorized to issue up to $500 million of unsecured,
subordinated variable rate bonds (the "Bonds").  The Bonds could have been
issued in series, each substantially identical in form pari passu in right
and having substantially identical terms except for the date of issuance.
The Company could not issue any subsequent series of Bonds unless no event
of default under the Master Indenture had occurred or had been continuing
with respect to any Bond previously issued within the 12 month period
immediately preceding the date of issuance of such subsequent series, and
not less than 75 percent of the net proceeds received from the issuance of
the immediately preceding series of Bonds had been utilized or formally
committed.

In August 1993, the Company made an initial issuance of Bonds at par in
the aggregate principal amount of $50 million  in a public offering
concurrent with the Company's initial public offering of Common Stock.
The sale of the Bonds generated net proceeds of $46.9 million after
related debt issuance costs.  No other issuances of Bonds had since
occurred.

Interest on the Bonds was payable semi-annually on January 25 and July 25
to holders of record on the preceding December 31, and June 30,
respectively.  The interest paid for each semi-annual period was the
greater of: (i) the Bank's prime rate as of the first day of the semi-
annual period, (ii) the Bank's weighted daily average prime rate during
the semi-annual period, (iii) a rate specified by the Company prior to the
commencement of the semi-annual period, and, (iv) 80 percent of the
"portfolio yield".  Portfolio yield was defined as: (i) the aggregate of
interest received from the Company's loan portfolio and gains less losses,
if any, realized from the disposition of equity securities or warrants to
acquire equity securities received in connection with the making or
purchasing of loans; less (ii) the provision for credit losses.

The Bonds were to mature on July 31, 2008 and were subject to mandatory
redemption by the Company in annual instalments commencing July 31, 2004
through July 31, 2008.  The annual instalment amount was equal to 20
percent of the outstanding principal on June 30, 2004.  The Bonds were
also subject to mandatory redemption generally upon the sale or transfer
of substantially all of the assets of the Company.

During the year ended June 30, 1998, $1,487,000 in aggregate principal
amount of Bonds were repurchased, resulting in an extraordinary gain of
$485,000.  No repurchase had occurred in fiscal years 1999 and 2000.

In February 1998, MFC Bancorp Ltd. owned all of the Bonds, which had a
face value of $21,515,000, as approved by a court order.

                                     27


<PAGE> 28


DRUMMOND FINANCIAL CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in tables stated in thousands)
JUNE 30, 2000


==========================================================================

8.     DEBT (cont'd...)

On January 25, 1999, MFC Bancorp Ltd. delivered all of the outstanding
Bonds to the Company in exchange for a promissory note.  The promissory
note was to pay interest at 8.75% per annum payable semi-annually on
January 25 and July 25 of each year and matures on July 31, 2008.  In
August 1999, The Company entered into a debt restructuring agreement with
MFC Bancorp Ltd., pursuant to which the rate of interest is reduced to 5%
per annum and the debt is secured by fixed liens upon the assets of the
Company.  The promissory note had a fair value of approximately
$21,515,000 as of June 30, 2000 and 1999.


9.     SHAREHOLDERS' EQUITY

In June 1996, the Company issued 3,000,000 shares of its Preferred Stock,
Series 1 for $6,000,000 cash.  The Preferred Stock, Series 1 pays a
cumulative dividend at 5% per annum on paid-up amount; accrued interest at
8% per annum on accrued and unpaid dividends; is redeemable by the Company
at any time at the paid-up amount plus 10% premium; and has variable
voting rights.

MFC Bancorp Ltd. owns directly and indirectly 49.4% (1999 - 49.4%) of the
Company's Common Stock and 100% (1999 - 100%) of the Company's Preferred
Stock.

In connection with its initial public offering, the Company issued
warrants to its underwriters representing the right to purchase 200,000
shares of the Company's Common Stock at $4.50 per share.  The number of
shares and exercise price are subject to adjustment for certain changes in
the Company's capital structure.  These warrants expired unexercised on
August 16, 1998.


10.     STOCK OPTION PLAN

In June 1993, the Board of Directors approved the adoption of the Stock
Option Plan.  Under the plan, substantially all employees, consultants and
non-employee directors are eligible to receive options to purchase up to
an aggregate of shares of the Company's common stock at exercise prices
which cannot be less than the fair market value of the shares on the date
the options are granted.  The term of each option can be no more than 10
years.  Non-employee directors of the Company can be granted options to
purchase 25,000 shares of common stock on the date they become a director
and additional options to purchase 3,500 shares of common stock are
granted upon the completion of each full year of service and at the Annual
Meeting of Shareholders thereafter.  Information with respect to options
granted under the plan is as follows:

<TABLE>
<CAPTION>
==========================================================================
                                                           Exercise Price
                                                               Per Share
                                                 Number         (Not in
                                               of Shares      Thousands)
                                               ---------   --------------
<S>                                            <C>         <C>

Outstanding, June 30, 1997                        25,000          $1.88
  Expired                                        (25,000)         $1.88
                                                --------
Outstanding, June 30, 1998, 1999 and 2000              -
==========================================================================
</TABLE>

                                     28


<PAGE> 29


DRUMMOND FINANCIAL CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in tables stated in thousands)
JUNE 30, 2000

==========================================================================

10.     STOCK OPTION PLAN (continued)

At June 30, 2000, 1999 and 1998 options to purchase 375,000 shares of the
Company's Common Stock are available for future grant.  There were no
options granted in either 2000, 1999 or 1998.

The disclosure requirements of FASB Statement No. 123 are effective for
the Company's financial statements starting from the fiscal year ended
June 30, 1997.  No pro forma disclosures are presented because there have
been no options granted after the fiscal year ended June 30, 1995.


11.     INCOME TAXES

There was no provision for income taxes for the years ended June 30, 2000,
1999 and 1998 (other than the payment of state minimum income tax of
$1,000 each in 2000, 1999 and 1998).

Differences between the United States federal statutory and the Company's
effective tax rates are as follows:

<TABLE>
<CAPTION>
=========================================================================
                                  2000              1999             1998
-------------------------------------------------------------------------
<S>                               <C>               <C>              <C>

United States federal statutory
  rate on income (loss) from
  operations                   $    37          $   114          $   (721)
Timing differences on credit
  losses                             -             (714)             (406)
Other                             (223)            (243)              315
Valuation allowance                186              843               812
                               -------          -------          --------
                               $     -          $     -          $      -
==========================================================================
</TABLE>

The net deferred tax assets at June 30, 2000 and 1999 consist of the
following:

<TABLE>
<CAPTION>
==========================================================================
                                                    2000             1999
--------------------------------------------------------------------------
<S>                                                 <C>              <C>

Net operating loss carryforwards               $   2,930        $   3,067
Other timing differences                             319              469
Valuation allowance                               (3,249)          (3,536)
                                               ---------        ---------
Deferred tax asset, net                        $       -        $       -
==========================================================================
</TABLE>

At June 30, 2000, the Company has $9.0 million in net operating loss
carryforwards for United States federal income tax purposes and $3.1
million for California income tax purposes.  The carryforwards expire in
the fiscal years ending in 2009 to 2019 for United States federal income
tax purposes and 1999 to 2001 for California income tax purposes.
Utilization of net operating loss carryforwards for United States federal
income tax purposes may be limited by the Internal Revenue Code because of
changes in the ownership of the Company.


12.     SEGMENTED INFORMATION

The Company conducted substantially all of its business of investment and
merchant banking activities and asset-based commercial lending in North
America as one business segment.

                                     29


<PAGE> 30


DRUMMOND FINANCIAL CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in tables stated in thousands)
JUNE 30, 2000

==========================================================================


13.     RELATED PARTY TRANSACTIONS

During the year ended June 30, 2000, the Company incurred $300,000  (1999
- $300,000; 1998 - $300,000) in fees payable to MFC Bancorp Ltd. and
$300,000 (1999 - $300,000; 1998 - $300,000) to Logan International Corp.,
both of which have a common director with the Company.  These fees were
paid for the accounting and administration of the Company and
reimbursement of office expenses.  The Company also paid $Nil (1999 -
$Nil; 1998 - $22,000) in consulting fees and expense reimbursements to a
company which is owned and controlled by a former officer of the Company.
During fiscal year 2000, the Company paid $300,000 (1999 - $300,000; 1998
- $300,000) of dividends on its preferred shares held by a subsidiary of
MFC Bancorp Ltd.  The Company also collected $300,000 (1999 - $300,000;
1998 - $300,000) of dividends on its investments in preferred shares
issued by another subsidiary of MFC Bancorp Ltd.  The Company has an
amount of $Nil (1999 - $780,000; 1998 - $780,000) due from Ichor
Corporation.  The Company also has an amount of $Nil (1999 - $2,300,000;
1998 - $Nil) due from a company which had a common director with the
Company and the Company accrued $Nil (1999 - $82,000; 1998 - $Nil) in
interest income thereon; and the amount due bears interest at the U.S.
base rate plus 3% per annum, matures on December 31, 2001 and is secured
by assets of the company.


14.     COMMITMENTS AND CONTINGENCIES

In February 1999, Gibralt Holdings Ltd. ("Gibralt") commenced proceedings
in Delaware Chancery Court seeking access to certain records of the
Company for the purpose of investigating alleged mismanagement. In May
1999, the Court granted Gibralt's application in part, allowing it access
to some records. In September 1999, Gibralt commenced a putative
derivative action in Delaware Chancery Court naming the Company, certain
of its directors and officers and others as defendants.  The claim has
been filed in the form of a class action on behalf of  shareholders, but
has not received Court certification as such.  Gibralt alleges that the
defendants have breached certain fiduciary duties, engaged in self-dealing
and failed in their disclosure obligations.  The remedies sought by
Gibralt include, among other things, recovery of funds, judgement for
damages and certain other remedies that may be sought in the hearing of
the claim. The Company believes Gibralt's claims to be entirely without
merit and intends to vigorously defend against the lawsuit.


15.     SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CONSOLIDATED
        STATEMENT OF CASH FLOWS

Significant non-cash transactions in 2000 include:

a)     The Company received securities with fair value of $972,060 as
       settlement of an amount due from Ichor Corporation plus related
       accrued interest.

Significant non-cash transactions in 1999 include:

a)     The Company exchanged bonds payable with a carrying value of
       $21,515,000 for a note payable of $21,515,000.

b)     The Company cancelled 1,545,400 common shares held as treasury
       stock valued at $3,056,000.

Significant non-cash transaction in 1998 include:

a)     The Company received securities with fair value of $2,915,000 as a
       partial settlement of a note receivable.

b)     The Company's note receivable in the amount of $4,474,000 was
       partially offset against its note payable.

                                     30


<PAGE> 31


DRUMMOND FINANCIAL CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in tables stated in thousands)
JUNE 30, 2000

==========================================================================

16.     DIFFERENCES BETWEEN UNITED STATES AND CANADIAN GENERALLY
        ACCEPTED ACCOUNTING PRINCIPLES

The Company's consolidated financial statements have been prepared in
accordance with United States Generally Accepted Accounting Principles
("U.S. GAAP") which conform in all material respects with Canadian
Generally Accepted Accounting Principles ("Canadian GAAP") except as set
forth below:

<TABLE>
<CAPTION>
==========================================================================
                                   June 30,       June 30,       June 30
                                      2000           1999           1998
--------------------------------------------------------------------------
<S>                                <C>            <C>            <C>

Net income (loss) for the year
  in accordance with U.S. GAAP  $      108     $      336     $   (2,122)

Reconciliation                           -              -              -
                                ----------     ----------     ----------
Net income (loss) for the year
  in accordance with Canadian
  GAAP                                 108            336         (2,122)

Accumulated deficit, beginning
  of year                          (17,483)       (17,519)       (15,097)

Dividends paid and payable            (300)          (300)          (300)
                                ----------     ----------     ----------
Accumulated deficit, end of year
  in accordance with Canadian
  GAAP                          $  (17,675)     $ (17,483)    $  (17,519)
==========================================================================
Basic earnings (loss) per share
  in accordance with Canadian
  GAAP                          $    (0.07)     $    0.01     $    (0.89)
==========================================================================
Fully diluted earnings (loss)
  per share in accordance with
  Canadian GAAP                 $    (0.07)     $    0.01     $    (0.89)
==========================================================================
</TABLE>

(a)     Investments

U.S. GAAP require that trading securities be carried at fair market value
with holding gains and losses included in the net income or loss.
Warrants to acquire common stock for which a readily determinable fair
market value is available and the Company has an unrestricted right to
sell the warrant and/or underlying securities within one year are included
in trading securities.  Canadian GAAP would require that such securities
be carried at the lower of cost or market with gains recorded only as
realized.  There were no differences between U.S. and Canadian GAAP in the
determination of net income (loss) for the years ended June 30, 2000, 1999
and 1998.

(b)     Extinguishment of Debt

U.S. GAAP require gains and losses on the extinguishment of debt to be
classified as an extraordinary item.  Under Canadian GAAP, the gain or
loss would be included in income (loss) from operations.

                                       31


<PAGE> 32


                                   SIGNATURES


Pursuant to the requirements of Section 13 or 15(d) 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.

                                  DRUMMOND FINANCIAL CORPORATION


Date: September 25, 2000          By: /s/ Michael J. Smith
                                      --------------------
                                      Michael J. Smith
                                      President, Chief Executive Officer,
                                      Chief Financial Officer and Director

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.


/s/ Michael J. Smith                  Date:   September 25, 2000
--------------------
Michael J. Smith
President, Chief Executive Officer,
Chief Financial Officer and Director


/s/ Young-Soo Ko                      Date:   September 25, 2000
--------------------
Young-Soo Ko
Director


/s/ Oq-Hyun Chin                      Date:   September 25, 2000
--------------------
Oq-Hyun Chin
Director

                                       32


<PAGE> 33


                                 EXHIBIT INDEX

Exhibit No.                         Document

   2.1      Arrangement Agreement among Drummond Financial (B.C.) Ltd.,
            MFC Bancorp Ltd. and Drummond Financial Corporation dated
            February 23, 1998. Incorporated by reference to Form T-3 of
            MFC Bancorp Ltd. dated March 2, 1998.
   2.2      Amendment Agreement among Drummond Financial (B.C.) Ltd., MFC
            Bancorp Ltd. and Drummond Financial Corporation dated March
            23, 1998.  Incorporated by reference to Form 10-KSB dated
            September 28, 1998.
   3.1      Certificate of Incorporation dated June 1, 1993.  Incorporated
            by reference to Form S-1 filed June 7, 1993.
   3.2      Certificate of Designations dated July 19, 1996.  Incorporated
            by reference to Form 10-KSB dated September 20, 1996.
   3.3      Certificate of Amendment to the Certificate of Incorporation
            of Drummond Financial Corporation dated October 14, 1996.
            Incorporated by reference to Form 10-QSB dated November 11,
            1996.
   3.4      Bylaws.  Incorporated by reference to Form S-1 filed June 7,
            1993.
   3.5      Amendment to the Bylaws adopted as of July 20, 1993.
            Incorporated by reference to Amendment No. 1 to Form S-1 filed
            July 26, 1993.
   4.1      Form of Indenture between CVD Financial Corporation and Harris
            Trust Company of New York, as Trustee.  Incorporated by
            reference to Form S-1 filed June 7, 1993.
   4.2      Second Supplemental Indenture between Drummond Financial
            Corporation and Harris Trust Company of New York, as Trustee,
            dated for reference October 23, 1996.  Incorporated by
            reference to Form 10-QSB dated November 11, 1996.
   4.3      Third Supplemental Indenture among Drummond Financial
            Corporation, Harris Trust Company of New York and The Bank of
            Nova Scotia Trust Company of New York dated for reference May
            13, 1997.  Incorporated by reference to Form 10-KSB dated
            September 24, 1997.
   4.4      Fourth Supplemental Indenture among Drummond Financial
            Corporation, The Bank of Nova Scotia Trust Company of New York
            and Drummond Financial (B.C.) Ltd. dated for reference
            February 4, 1998.  Incorporated by reference to Form 10-KSB
            dated September 28, 1998.
   10.1     1993 Stock Option Plan.  Incorporated by reference to Form S-1
            filed June 7, 1993.
   10.2     Profit Sharing Plan.  Incorporated by reference to Amendment
            No. 1 to Form S-1 filed July 26, 1993.
   10.3     Debt Restructuring Agreement between MFC Bancorp Ltd. and
            Drummond Financial Corporation dated August 30, 1999.
            Incorporated by reference to Form 10-K dated September 24,
            1999.
   21       List of subsidiaries of the Registrant.
   27       Article 5 - Financial Data Schedule for year ended June 30,
            2000 - Form 10-K.