<PAGE>
                                    FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                   (Mark one)


[X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2002

                                       or

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

                         Commission File Number: 0-20677

                           FIRSTCITY LIQUIDATING TRUST
             (Exact name of registrant as specified in its charter)

<TABLE>
<S>                                                          <C>
                  Texas                                          06-6414468
    (State or other jurisdiction of                           (I.R.S. Employer
     incorporation or organization)                          Identification No.)

 1001 Fannin, Suite 505, Houston, Texas                             77002
(Address of principal executive offices)                         (Zip Code)
</TABLE>

       Registrant's telephone number, including area code: (713) 651-7841

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 whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). Yes    No X

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: As of September 30, 2002,
2,454,310 units of Class B Beneficial Interests and 725,729 units of Class C
Beneficial Interests were outstanding.
<PAGE>
SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS

This Form 10-Q may include "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. The opinions, forecasts,
projections, guidance or other statements other than statements of historical
fact, are forward-looking statements. These statements are based upon
assumptions that are subject to change and other risks. Although the Trust
believes that the expectations reflected in such forward-looking statements are
reasonable, it can give no assurance that such expectations will prove to have
been correct. Certain risks and uncertainties inherent in the Trust's business
are set forth in the filings of the Trust with the Securities and Exchange
Commission.

PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                  FIRSTCITY LIQUIDATING TRUST AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF NET ASSETS IN LIQUIDATION
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                       SEPTEMBER 30,  DECEMBER 31,
                                                           2002          2001
                                                           ----          ----
                                                        (Unaudited)
<S>                                                    <C>            <C>
        Assets, at estimated fair value
Cash and cash equivalents                                 $ 4,066       $ 3,265
Trust assets, net                                          34,440        35,316
                                                          -------       -------
    Total assets                                           38,506        38,581
                                                          -------       -------
        Less liabilities at face or estimated amount

Payables and accrued liabilities                            1,606         1,681
                                                          -------       -------
    Total liabilities                                       1,606         1,681
                                                          -------       -------
Commitments and contingencies                                  --            --
        Trust net asset value attributable to:

Class "B" Certificate, 2,454,310 units outstanding         36,900        36,900
Class "C" Certificate, 725,729 units outstanding               --            --
                                                          -------       -------
    Total net asset value                                 $36,900       $36,900
                                                          =======       =======
</TABLE>

                    CONSOLIDATED STATEMENTS OF OPERATIONS AND
                    CHANGES IN NET ASSET VALUE IN LIQUIDATION
                        (DOLLARS IN THOUSANDS)(UNAUDITED)

<TABLE>
<CAPTION>
                                                    THREE MONTHS                   NINE MONTHS
                                                 ENDED SEPTEMBER 30,           ENDED SEPTEMBER 30,
                                                 -------------------           -------------------
                                                 2002           2001           2002           2001
                                                 ----           ----           ----           ----
<S>                                            <C>            <C>            <C>            <C>
Changes in fair value of trust assets          $    314       $    289       $  1,098       $  1,714
Interest income on short-term investments            16             20             43             92
Administrative expense                             (330)          (309)        (1,141)        (1,252)
                                               --------       --------       --------       --------
    Net income                                       --             --             --            554
                                               --------       --------       --------       --------
Net asset value, beginning of period             36,900         44,200         36,900         46,100
Distributions on Class "B" Certificate               --             --             --         (2,454)
                                               --------       --------       --------       --------
Net asset value, end of period                 $ 36,900       $ 44,200       $ 36,900       $ 44,200
                                               ========       ========       ========       ========
</TABLE>

See accompanying notes to consolidated financial statements.


                                       2
<PAGE>
                  FIRSTCITY LIQUIDATING TRUST AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                        (DOLLARS IN THOUSANDS)(UNAUDITED)

<TABLE>
<CAPTION>
                                                                    NINE MONTHS ENDED
                                                                      SEPTEMBER 30,
                                                                      -------------
                                                                    2002          2001
                                                                  -------       -------
<S>                                                               <C>           <C>
Cash flows from operating activities:
    Net income                                                    $    --       $   554
    Adjustments to reconcile net income to net cash provided
    by operating activities:
        Changes in fair value of trust assets                      (1,098)       (1,714)
        Collections on trust assets, net of advances                1,974         3,214
        Decrease in payables and accrued liabilities                  (75)         (306)
                                                                  -------       -------
            Net cash provided by operating activities                 801         1,748
                                                                  -------       -------

Cash flows from financing activities:
    Distributions on Class "B" Certificate                             --        (2,454)
                                                                  -------       -------

        Net cash used in financing activities                          --        (2,454)
                                                                  -------       -------

    Net increase (decrease) in cash and cash equivalents          $   801       $  (706)
    Cash and cash equivalents, beginning of period                  3,265         3,556
                                                                  -------       -------
    Cash and cash equivalents, end of period                      $ 4,066       $ 2,850
                                                                  =======       =======
</TABLE>

See accompanying notes to consolidated financial statements.


                                        3
<PAGE>
                  FIRSTCITY LIQUIDATING TRUST AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                               September 30, 2002

(A)   Basis of Presentation

      The unaudited consolidated financial statements of FirstCity Liquidating
      Trust (the "Trust", formerly the "Debtor") reflect, in the opinion of
      management, all adjustments, consisting only of normal and recurring
      adjustments, necessary to present fairly the Trust's net assets in
      liquidation at September 30, 2002, its changes in net asset value in
      liquidation for the three month and nine month periods ended September 30,
      2002 and 2001, and its cash flows for the nine months ended September 30,
      2002 and 2001.

      Management of the Trust has made certain estimates and assumptions
      relating to the reporting of assets and liabilities and the disclosure of
      contingent assets and liabilities to prepare these consolidated financial
      statements in conformity with accounting principles generally accepted in
      the United States of America. Actual results could differ from those
      estimates.

(B)   Trust Assets

      Trust assets are comprised of the following (dollars in thousands):

<TABLE>
<CAPTION>
                                                   September 30,   December 31,
Estimated Gross Cash Flow by Type of Asset             2002           2001
------------------------------------------             ----           ----
                                                    (Unaudited)
<S>                                                   <C>            <C>
Borrowers' obligation on outstanding balance of:
    Performing loans                                  $    556       $  1,867
    Nonperforming loans                                     16             32
Real estate and other assets                            38,548         38,651
                                                      --------       --------
    Total                                               39,120         40,550
                                                      --------       --------

    Discount required to reflect trust assets at
      estimated fair value                              (4,680)        (5,234)
                                                      --------       --------

Trust assets, net                                     $ 34,440       $ 35,316
                                                      ========       ========
</TABLE>

      For each asset, estimates of income, expense and net cash flow on a
      monthly basis through the expected final disposition date are prepared by
      management of the Trust. The individual asset budget is developed based
      upon factors which include physical inspection of the asset or the
      collateral underlying the related loan, local market conditions,
      contractual payments or rents, and discussions with the relevant borrower.
      The Trust's management and the Portfolio Committee periodically reevaluate
      and revise projected monthly cash flows on an asset by asset basis. At
      September 30, 2002 and December 31, 2001, the projected monthly cash flows
      were discounted at 7% to reflect the Trust assets at estimated fair value.
      The Trust assets are highly concentrated in Texas.


                                       4
<PAGE>
                  FIRSTCITY LIQUIDATING TRUST AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                   (continued)

      On March 15, 2002, two subsidiaries of the Trust settled all existing
      litigation with UIDC Management, Inc. ("UIDC") et al. The Trust and UIDC
      are partners in FC Tower Property Partners, L.P., an entity which owns the
      First City Tower building in Houston, Texas. The dispute between the
      parties traces to a "right of first refusal" issue occurring in 1997.

      The settlement allows the Trust to market its interest in the partnership.
      UIDC will retain its right of first refusal and may exercise that right at
      a discount from the purchase price. The discount is equal to 50% of the
      amount by which a third party offer exceeds $31 million. The Trust's share
      of any sale proceeds would be $31 million plus 50% of the price in excess
      of $31 million. Further, if the Trust is unsuccessful in (a) obtaining a
      qualified offer by June 2003 and (b) executing on a sale of the interest
      by December 2003, its 67% interest in the partnership will be reduced to
      45% and UIDC's 33% interest will increase to 55%.

      At September 30, 2002, the partnership interest is valued at $38 million
      (based on an estimated sale price of $45 million). The consolidated
      statements of net assets in liquidation have never reflected any value for
      the Class C Certificates, and it is highly unlikely that the Class C
      Certificates will have any value.

(C)   Distribution Priorities

      The Trust is required to apply all proceeds from the liquidation and
      disposition of the Trust's assets first to payment of normal operating
      expenses. Second, Trust proceeds totaling $188 million were distributed to
      FirstCity Financial Corporation ("FirstCity") to retire the Class A
      Certificate in December 1997. The third order of distribution of Trust
      proceeds is payments pursuant to employment and bonus agreements with
      certain former employees of the Debtor. The bonus pool and executive
      long-term incentive plan provides for the payment of bonuses equal to
      4.76% of additional distributions to Class B Certificate holders and (if
      any) Class C Certificate holders.

      Fourth, Class B Certificate holders are entitled to distributions up to
      the Pour-Over Level. The Pour-Over Level (approximately $54 million at
      September 30, 2002) is the liquidation preference on July 3, 1995 of the
      Debtor's Series B and Series E preferred stock, less the nominal stated
      value of FirstCity special preferred stock and the book value of FirstCity
      common stock issued to the Series B and Series E holders, plus interest at
      an annual rate of 6.5% from July 3, 1995. The Pour-Over Level is reduced
      for distributions to Class B Certificate holders. In the first nine months
      of 2001, $2.5 million, or $1.00 per Certificate, was distributed to Class
      B Certificate holders and a $112,000 bonus was paid to certain former
      employees of the Debtor.

      Lastly, Class C Certificate holders receive distributions, if any, after
      any remaining payments to Class B Certificate holders up to the Pour-Over
      Level (approximately $22.08 per unit as of September 30, 2002).


                                        5
<PAGE>
                  FIRSTCITY LIQUIDATING TRUST AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                   (continued)

      The ultimate amounts to be distributed to the holders of the B and C
      Certificates will result from the cash flow actually realized from the
      liquidation of the non-cash Trust assets (principally the partnership
      interest discussed in Note B). The determination of the net asset value of
      the Trust in the accompanying consolidated statements of net assets in
      liquidation is based upon estimates of future cash flows. The actual cash
      flows and the timing of such cash flows may vary significantly from those
      estimates, thus affecting the final distributions to the Certificate
      holders.

(D)   Commitments and Contingencies

      In July 2002, Gordonville Corporation, N.V., New Coronado Investment
      Corp., N.V. and Corona Investments, N.V., companies which claim to own
      approximately 46% of the 725,729 Class C Certificates (acquired in various
      tender offers at prices varying from approximately $1.00 to $1.50) filed a
      lawsuit against the Trustee and individual members of the Portfolio
      Committee of the Trust in the U.S. Bankruptcy Court for the Northern
      District of Texas, Dallas Division (Gordonville Corporation, et al. vs.
      State Street Bank and Trust Company et al., Case No. 392-39474-HCA-11).
      The complaint alleges, among other things, that the Trustee and the
      individual members of the Portfolio Committee breached their fiduciary
      duties to the Class C Certificate holders in a manner which would prevent
      the Class C Certificate holders from realizing any value. The complaint
      seeks $14 million in actual damages, plus punitive damages and attorneys'
      fees. Management of the Trust and the members of the Portfolio Committee
      believe that the lawsuit is entirely without merit and intend to
      vigorously defend against the action.

      The Trust is involved in various other legal proceedings in the ordinary
      course of business. In the opinion of management of the Trust, the
      resolution of such matters will not have a material adverse impact on the
      consolidated financial position, results of operations or liquidity of the
      Trust.

      In 1996 the FDIC closed the receiverships of the Debtor's banks and
      distributed the remaining surplus of those receiverships to the Trust. In
      accordance with a conveyance and indemnification agreement, the Trust is
      required, among other things, to provide indemnity to the FDIC against any
      known or unknown liabilities, obligations or actual expenses associated
      with the receiverships, in an aggregate amount up to $10 million until the
      termination of the Trust. Management of the Trust does not believe that,
      to the extent the Trust is obligated to pay certain claims or expenses
      associated with the past obligations of the Debtor's banks, such payments
      will have a material adverse impact on the consolidated financial
      position, results of operations or liquidity of the Trust.


                                        6
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations.

      The operations of the Trust for the third quarter and first nine months of
2002 and 2001 are summarized below (dollars in thousands):

<TABLE>
<CAPTION>
                                                                                NINE MONTHS
                                                   THIRD QUARTER            ENDED SEPTEMBER 30,
                                                   -------------            -------------------
                                                2002          2001          2002          2001
                                               -------       -------       -------       -------
<S>                                            <C>           <C>           <C>           <C>
Changes in fair value of trust assets          $   314       $   289       $ 1,098       $ 1,714
Interest income on short-term investments           16            20            43            92
Administrative expense                            (330)         (309)       (1,141)       (1,252)
                                               -------       -------       -------       -------
    Net income                                 $    --            $-            $-       $   554
                                               =======       =======       =======       =======
</TABLE>

                THIRD QUARTER 2002 COMPARED TO THIRD QUARTER 2001

      The estimated fair value of the Trust's assets increased $.3 million in
the third quarter of 2002 and 2001. Factors which contributed to the enhancement
of the net asset value of the Trust's assets in the third quarter of 2002 and
2001 include (i) the appreciation in value of certain assets attributable to a
favorable interest rate environment and the effect of such favorable interest
rates on the marketability of real estate and (ii) the increase in the estimated
market value of the Trust's assets that naturally occurs as the remaining life
of the Trust (and concomitantly the discount factor applied in calculating net
asset value) decreases.

      Interest income on short-term investments decreased in the third quarter
of 2002 as compared to the third quarter of 2001 due to lower money market
yields. Administrative expense totaled $.3 million in the third quarter of 2002
and 2001.

                      NINE MONTHS ENDED SEPTEMBER 30, 2002
                COMPARED TO NINE MONTHS ENDED SEPTEMBER 30, 2001

      The estimated fair value of the Trust's assets increased $1.1 million in
the first nine months of 2002 as compared to $1.7 million in the first nine
months of 2001. Factors which contributed to the enhancement of the net asset
value of the Trust's assets in the first nine months of 2002 and 2001 include
(i) the appreciation in value of certain assets attributable to a favorable
interest rate environment and the effect of such favorable interest rates on the
marketability of real estate and (ii) the increase in the estimated market value
of the Trust's assets that naturally occurs as the remaining life of the Trust
(and concomitantly the discount factor applied in calculating net asset value)
decreases.

      Interest income on short-term investments decreased in 2002 as compared to
2001 due to lower money market yields.

      Administrative expense totaled $1.1 million in the first nine months of
2002 as compared to $1.3 million in the first nine months of 2001. A $112,000
bonus, based on distributions to Class B Certificate holders, was paid to
certain former employees of the Debtor in the first nine months of


                                        7
<PAGE>
2001 as compared to no bonus paid to such employees in 2002. Professional fees
totaled $.4 million in 2002 as compared to $.3 million in 2001.

      Net collections on Trust assets in the first nine months of 2002 totaled
$2.0 million as compared to $3.2 million in 2001. The Class B Beneficial
Interests were valued at $36.9 million at September 30, 2002.

      Non-cash trust assets at September 30, 2002 and December 31, 2001 were
comprised of the following (dollars in thousands):

<TABLE>
<CAPTION>
                `                                   September 30,  December 31,
Estimated Gross Cash Flow by Type of Asset              2002           2001
------------------------------------------            --------       --------
<S>                                                 <C>            <C>
Borrowers' obligation on outstanding balance of:
    Performing loans                                  $    556       $  1,867
    Nonperforming loans                                     16             32
Real estate and other assets                            38,548         38,651
                                                      --------       --------
    Total                                               39,120         40,550
                                                      --------       --------
    Discount required to reflect trust assets at
      estimated fair value                              (4,680)        (5,234)
                                                      --------       --------
Trust assets, net                                     $ 34,440       $ 35,316
                                                      ========       ========
</TABLE>

      For each asset, estimates of income, expense and net cash flow on a
monthly basis through the expected final disposition date are prepared by
management of the Trust. The individual asset budget is developed based upon
factors which include physical inspection of the asset or the collateral
underlying the related loan, local market conditions, contractual payments or
rents, and discussions with the relevant borrower. The Trust's management and
the Portfolio Committee periodically reevaluate and revise projected monthly
cash flows on an asset by asset basis. At September 30, 2002 and December 31,
2001, the projected monthly cash flows were discounted at 7% to reflect the
Trust assets at estimated fair value. The Trust assets are highly concentrated
in Texas.

      On March 15, 2002, two subsidiaries of the Trust settled all existing
litigation with UIDC Management, Inc. ("UIDC") et al. The Trust and UIDC are
partners in FC Tower Property Partners, L.P., an entity which owns the First
City Tower building in Houston, Texas. The dispute between the parties traces to
a "right of first refusal" issue occurring in 1997.

      The settlement allows the Trust to market its interest in the partnership.
UIDC will retain its right of first refusal and may exercise that right at a
discount from the purchase price. The discount is equal to 50% of the amount by
which a third party offer exceeds $31 million. The Trust's share of any sale
proceeds would be $31 million plus 50% of the price in excess of $31 million.
Further, if the Trust is unsuccessful in (a) obtaining a qualified offer by June
2003 and (b) executing on a sale of the interest by December 2003, its 67%
interest in the partnership will be reduced to 45% and UIDC's 33% interest will
increase to 55%.

      At September 30, 2002, the partnership interest is valued at $38 million
(based on an estimated sale price of $45 million). The consolidated statements
of net assets in liquidation have never reflected any value for the Class C
Certificates, and it is highly unlikely that the Class C Certificates will have
any value.


                                        8
<PAGE>
Item 4. Controls and Procedures.

      As of September 30, 2002, management of the Trust performed an evaluation
of disclosure controls and procedures. Based on that evaluation, management of
the Trust concluded that the disclosure controls and procedures of the Trust
were effective. There have been no significant changes in the Trust's internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of their evaluation.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

      In July 2002, Gordonville Corporation, N.V., New Coronado Investment
Corp., N.V. and Corona Investments, N.V., companies which claim to own
approximately 46% of the 725,729 Class C Certificates (acquired in various
tender offers at prices varying from approximately $1.00 to $1.50) filed a
lawsuit against the Trustee and individual members of the Portfolio Committee of
the Trust in the U.S. Bankruptcy Court for the Northern District of Texas,
Dallas Division (Gordonville Corporation, et al. vs. State Street Bank and Trust
Company et al., Case No. 392-39474-HCA-11). The complaint alleges, among other
things, that the Trustee and the individual members of the Portfolio Committee
breached their fiduciary duties to the Class C Certificate holders in a manner
which would prevent the Class C Certificate holders from realizing any value.
The complaint seeks $14 million in actual damages, plus punitive damages and
attorneys' fees. Management of the Trust and the members of the Portfolio
Committee believe that the lawsuit is entirely without merit and intend to
vigorously defend against the action.

Item 6. Exhibits and Reports on Form 8-K.

      (a) Exhibits

<TABLE>
<CAPTION>
Exhibit
  No.                                 Description
-------                               -----------
<S>      <C>
2.1(1)   Joint Plan of Reorganization for First City Bancorporation of Texas,
         Inc., as modified, under Chapter 11 of the United States Bankruptcy
         Code, as confirmed by the U.S. Bankruptcy Court for the Northern
         District of Texas, Dallas Division, on May 31, 1995.

2.2(5)   Order To Extend Term of FirstCity Liquidating Trust, dated June 11,
         2001.

3.1(1)   The Liquidating Trust Agreement, dated as of July 3, 1995, by and
         between First City Bancorporation of Texas, Inc. and Shawmut Bank
         Connecticut, National Association (subsequently Fleet National Bank,
         now State Street Bank and Trust Company), as Trustee.

10.1(3)  Employment Agreement, effective as of July 3, 1995, by and between FCLT
         Loans Asset Corp. and Robert W. Brown, as amended May 1, 1996.

10.2(2)  Settlement Agreement, dated as of June 22, 1994, as amended as of
         January 30, 1995, by and among FDIC-Corporate, the FDIC-Receivers and
         the First City Parties.
</TABLE>


                                       9
<PAGE>
<TABLE>
<S>      <C>
10.3(3)  Conveyance and Indemnification Agreement, dated December 23, 1996,
         between FDIC-Corporate, the FDIC-Receivers, FCLT Loans, L.P. and the
         Trust.

10.4(4)  Extension of Conveyance and Indemnification Agreement, dated in April
         1999, between FDIC-Corporate, the FDIC-Receivers, FCLT Loans, L.P. and
         the Trust.
</TABLE>

      (1) Filed as the exhibit indicated to the Registration Statement on Form
      10 filed with the Securities and Exchange Commission on May 1, 1996 and
      incorporated herein by reference.

      (2) Filed as the exhibit indicated to the Registration Statement on Form
      10/A filed with the Securities and Exchange Commission on July 10, 1996
      and incorporated herein by reference.

      (3) Filed as the exhibit indicated to the Form 10-K for the fiscal year
      ended December 31, 1996 filed with the Securities and Exchange Commission
      and incorporated herein by reference.

      (4) Filed as the exhibit indicated to the Form 10-Q for the quarter ended
      March 31, 1999 filed with the Securities and Exchange Commission and
      incorporated herein by reference.

      (5) Filed as the exhibit indicated to the Form 10-Q for the quarter ended
      June 30, 2001 filed with the Securities and Exchange Commission and
      incorporated herein by reference.

      (b) Reports on Form 8-K. No report on Form 8-K was filed by the Registrant
      with the Commission during the quarterly period ended September 30, 2002.


                                       10
<PAGE>
                                   SIGNATURES

      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.

                                        STATE STREET BANK AND TRUST COMPANY,
                                        as Trustee

Date: October 23, 2002                  /s/ Cauna Silva
                                        ----------------------------------------
                                        Name: Cauna Silva
                                             -----------------------------------
                                        Title: Assistant Vice President
                                              ----------------------------------


                                 CERTIFICATIONS

I, Robert W. Brown, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of FirstCity
      Liquidating Trust;

2.    Based on my knowledge, this quarterly report does not contain any untrue
      statement of a material fact or omit to state a material fact necessary to
      make the statements made, in light of the circumstances under which such
      statements were made, not misleading with respect to the period covered by
      this quarterly report;

3.    Based on my knowledge, the financial statements, and other financial
      information included in this quarterly report, fairly present in all
      material respects the financial condition, results of operations and cash
      flows of the registrant as of, and for, the periods presented in this
      quarterly report;

4.    The registrant's other certifying officers and I are responsible for
      establishing and maintaining disclosure controls and procedures (as
      defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we
      have:

      a)    Designed such disclosure controls and procedures to ensure that
            material information relating to the registrant, including its
            consolidated subsidiaries, is made known to us by others within
            those entities, particularly during the period in which this
            quarterly report is being prepared;

      b)    Evaluated the effectiveness of the registrant's disclosure controls
            and procedures as of a date within 90 days prior to the filing date
            of this quarterly report (the "Evaluation Date"); and

      c)    Presented in this quarterly report our conclusions about the
            effectiveness of the disclosure controls and procedures based on our
            evaluation as of the Evaluation Date;


                                       11
<PAGE>
5.    The registrant's other certifying officers and I have disclosed, based on
      our most recent evaluation, to the registrant's auditors and the audit
      committee of registrant's board of directors (or persons performing the
      equivalent function):

      a)    All significant deficiencies in the design or operation of internal
            controls which could adversely affect the registrant's ability to
            record, process, summarize and report financial data and have
            identified for the registrant's auditors any material weaknesses in
            internal controls; and

      b)    Any fraud, whether or not material, that involves management or
            other employees who have a significant role in the registrant's
            internal controls; and

6.    The registrant's other certifying officers and I have indicated in this
      quarterly report whether or not there were significant changes in internal
      controls or in other factors that could significantly affect internal
      controls subsequent to the date of our most recent evaluation, including
      any corrective actions with regard to significant deficiencies and
      material weaknesses.

Date: October 23, 2002

                                          /s/ Robert W. Brown
                                          ---------------------------
                                          Robert W. Brown
                                          Principal Executive Officer


I, Stephen J. Barta, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of FirstCity
      Liquidating Trust;

2.    Based on my knowledge, this quarterly report does not contain any untrue
      statement of a material fact or omit to state a material fact necessary to
      make the statements made, in light of the circumstances under which such
      statements were made, not misleading with respect to the period covered by
      this quarterly report;

3.    Based on my knowledge, the financial statements, and other financial
      information included in this quarterly report, fairly present in all
      material respects the financial condition, results of operations and cash
      flows of the registrant as of, and for, the periods presented in this
      quarterly report;

4.    The registrant's other certifying officers and I are responsible for
      establishing and maintaining disclosure controls and procedures (as
      defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we
      have:

      a)    Designed such disclosure controls and procedures to ensure that
            material information relating to the registrant, including its
            consolidated subsidiaries, is made known to us


                                       12
<PAGE>
            by others within those entities, particularly during the period in
            which this quarterly report is being prepared;

      b)    Evaluated the effectiveness of the registrant's disclosure controls
            and procedures as of a date within 90 days prior to the filing date
            of this quarterly report (the "Evaluation Date"); and

      c)    Presented in this quarterly report our conclusions about the
            effectiveness of the disclosure controls and procedures based on our
            evaluation as of the Evaluation Date;

5.    The registrant's other certifying officers and I have disclosed, based on
      our most recent evaluation, to the registrant's auditors and the audit
      committee of registrant's board of directors (or persons performing the
      equivalent function):

      a)    All significant deficiencies in the design or operation of internal
            controls which could adversely affect the registrant's ability to
            record, process, summarize and report financial data and have
            identified for the registrant's auditors any material weaknesses in
            internal controls; and

      b)    Any fraud, whether or not material, that involves management or
            other employees who have a significant role in the registrant's
            internal controls; and

6.    The registrant's other certifying officers and I have indicated in this
      quarterly report whether or not there were significant changes in internal
      controls or in other factors that could significantly affect internal
      controls subsequent to the date of our most recent evaluation, including
      any corrective actions with regard to significant deficiencies and
      material weaknesses.

Date: October 23, 2002

                                          /s/ Stephen J. Barta
                                          ----------------------------
                                          Stephen J. Barta
                                          Principal Financial Officer


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