SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                              ---------------------

                                    FORM 10-Q



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

For the quarterly period ended  June 30, 1997
                                -------------

                         Commission File Number 0-19799
                                                -------


                       PILGRIM AMERICA CAPITAL CORPORATION
                       -----------------------------------
                   F/K/A/ EXPRESS AMERICA HOLDINGS CORPORATION
             (Exact name of Registrant as specified in its charter)



            Delaware                                    86-0670679
-------------------------------             ------------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)


             40 North Central Avenue, Suite 1200, Phoenix, AZ 85004
             ------------------------------------------------------
               (Address of principal executive offices) (Zip Code)


Registrant's telephone number, including area code     (602) 417-8100
                                                  -------------------



         Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
Registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]

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


         3,866,130 Shares of Common Stock outstanding on August 7, 1997
         --------------------------------------------------------------
<PAGE>
                                      INDEX
<TABLE>
<CAPTION>
 PART I.  FINANCIAL INFORMATION                                                                            Page
                                                                                                           ----
<S>        <C>           <C>                                                                                <C>
           Item 1.       Financial Statements

                         (a)    Condensed Consolidated Financial Statements...........................       3

                         (b)    Notes to Condensed Consolidated Financial Statements..................       6


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

PART II.  OTHER INFORMATION

           Item 1.       Legal Proceedings............................................................      11


           Item 6.       Exhibits and Reports on Form 8-K.............................................      11

           Signatures.................................................................................      12
</TABLE>
                                       2
<PAGE>
ITEM 1. FINANCIAL STATEMENTS


PILGRIM AMERICA CAPITAL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except share amounts)


                                                          June 30, September 30,
                                                              1997        1996
--------------------------------------------------------------------------------

Assets
   Cash and cash equivalents                               $    235    $    238
   Investments                                                2,637       2,462
   Accounts receivable                                          331         216
   Notes receivable                                           3,938       3,587
   Costs assigned to management contracts acquired, less
        accumulated amortization of $2,910 and$1,943         29,352      30,320
   Furniture, fixtures and equipment, less accumulated
        depreciation of $330 and $1,378                         521       1,144
   Deferred taxes                                             7,581       1,750
   Deferred acquisition costs, less accumulated amortization
         of $554 and $131                                     4,783       1,939
   Other assets                                               1,000         899
                                                           --------    --------
Total assets                                               $ 50,378    $ 42,555
                                                           ========    ========
--------------------------------------------------------------------------------

Liabilities and stockholders' equity 
Liabilities:
   Net liabilities of discontinued operations              $    707    $  3,392
   Notes payable                                              6,575       3,600
   Accounts payable and accrued expenses                      2,687       5,775
                                                           --------    --------
               Total liabilities                              9,969      12,767
                                                           --------    --------


Stockholders' equity:
   Common stock, $.01 par value, 10,000,000 shares 
       authorized, 5,383,860 shares issued, with 
       3,866,130 shares outstanding                              54          54
   Less:  Treasury stock, 1,517,730 shares                   (8,623)     (8,623)
   Additional paid-in capital                                48,793      48,759
   Unrealized gain on investments                               420         333
   Accumulated deficit                                         (235)    (10,735)
                                                           --------    --------
                Total stockholders' equity                   40,409      29,788
                                                           --------    --------
Total liabilities and stockholders' equity                 $ 50,378    $ 42,555
                                                           ========    ========
--------------------------------------------------------------------------------

See accompanying notes to condensed consolidated financial statements.
                                       3
<PAGE>
PILGRIM AMERICA CAPITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(dollars in thousands except per share amounts)
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------

                                                    Three months ended             Nine months ended
                                                          June 30,                      June 30,
                                                     1997          1996           1997           1996
                                                 -------------------------    --------------------------
<S>                                              <C>           <C>            <C>            <C>        
Revenues
   Management and administrative fees            $     4,456   $     3,084    $    12,630    $     9,077
   Distribution fees                                     656           307          1,675            773
   Investment and other income                           582           214          1,120            567
                                                 -----------   -----------    -----------    -----------
          Total revenues                               5,694         3,605         15,425         10,417
                                                 -----------   -----------    -----------    -----------

--------------------------------------------------------------------------------------------------------
Expenses
     General and administrative                        2,027         1,903          5,818          5,834
     Selling                                           1,212         1,818          3,667          4,941
     Amortization and depreciation                       571           526          1,668          1,477
                                                 -----------   -----------    -----------    -----------
          Total expense                                3,810         4,247         11,153         12,252
                                                 -----------   -----------    -----------    -----------

Earnings (loss) from continuing operations
before income taxes (benefit)                          1,884          (642)         4,272         (1,835)

Income taxes  (benefit)                                  773             -         (5,815)             -
                                                 -----------   -----------    -----------    -----------

Net earnings (loss) from continuing operations         1,111          (642)        10,087         (1,835)
                                                 -----------   -----------    -----------    -----------

Net earnings  from operations of
discontinued mortgage business, net of tax               413             -            413              -
                                                 -----------   -----------    -----------    -----------

Net earnings (loss)                              $     1,524   ($      642)   $    10,500    ($    1,835)
                                                 ===========   ===========    ===========    ===========

--------------------------------------------------------------------------------------------------------

Earnings (Loss) per Common and
Common Equivalent Share
  Primary:
    Earnings (loss) from continuing operations   $      0.26   ($     0.13)   $      2.46    ($     0.38)
                                                 ===========   ===========    ===========    ===========

    Net earnings (loss)                          $      0.36   ($     0.13)   $      2.56    ($     0.38)
                                                 ===========   ===========    ===========    ===========

Shares used in per share calculation               4,233,411     4,877,860      4,098,060      4,877,860
                                                 ===========   ===========    ===========    ===========

  Fully Diluted:
    Earnings (loss) from continuing operations   $      0.26   ($     0.13)   $      2.35    ($     0.38)
                                                 ===========   ===========    ===========    ===========

    Net earnings (loss)                          $      0.35   ($     0.13)   $      2.45    ($     0.38)
                                                 ===========   ===========    ===========    ===========

Shares used in per share calculation               4,335,799     4,877,860      4,283,279      4,877,860
                                                 ===========   ===========    ===========    ===========

--------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes to condensed consolidated financial statements.
                                       4
<PAGE>
PILGRIM AMERICA CAPTIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands)
<TABLE>
<CAPTION>
                                                                       For the Nine Months
                                                                          Ended June 30,
-------------------------------------------------------------------------------------------
                                                                         1997        1996
-------------------------------------------------------------------------------------------
<S>                                                                    <C>         <C>      
Cash flows from operating activities
Net earnings (loss)                                                    $ 10,500    ($ 1,835)
Adjustments to reconcile net earnings (loss) to net cash provided by
    (used in) operating activities:
    Amortization and depreciation                                         1,668       1,477
    Increase  in accounts receivable                                       (466)       (340)
    Decrease in operating liabilities                                    (3,088)       (865)
    Increase in deferred acquisition costs                               (3,287)     (1,267)
    Increase in deferred tax asset                                       (5,831)       --
    (Increase) decrease  in other operating assets                         (295)        591
                                                                       --------    --------
Net cash used in operating activities                                      (799)     (2,239)
                                                                       --------    --------


-------------------------------------------------------------------------------------------


Cash flows from investing activities
    Investment in Pilgrim America Funds                                     (88)        (22)
    Sales of furniture, fixtures and equipment                               12         129
    Purchases of furniture, fixtures and equipment                          (35)       (235)
    Cash used in discontinued operations                                 (2,103)       (173)
                                                                       --------    --------
Net cash used in investing activities                                    (2,214)       (301)
                                                                       --------    --------


-------------------------------------------------------------------------------------------


Cash flows from financing activities
    Redemption of preferred stock                                          --          (338)
    Proceeds from purchase of stock options                                  35        --
    Term debt borrowing                                                   2,975       1,500
                                                                       --------    --------
    Net cash provided by financing activities                             3,010       1,162
                                                                       --------    --------
    Net  decrease  in cash and cash equivalents                              (3)     (1,378)
    Cash and cash equivalents, beginning of period                          238       1,858
                                                                       --------    --------
Cash and cash equivalents, end of period                               $    235    $    480
                                                                       ========    ========


-------------------------------------------------------------------------------------------


Supplemental disclosures
    Interest paid                                                      $    372    $    103
    Income taxes paid                                                        95           2
    Income tax refund recieved                                             --            12

-------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes to condensed consolidated financial statements.
                                       5
<PAGE>
                       PILGRIM AMERICA CAPITAL CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS



(1) BASIS OF FINANCIAL STATEMENT PRESENTATION

         Name Change.  On April 25, 1997,  Express America Holdings  Corporation
changed its name to Pilgrim  America  Capital  Corporation  (NASDAQ:  PACC) (the
"Company") in order to better reflect that the Company's  operating  business is
managing six open-end and two closed-end  mutual funds under the Pilgrim America
name.

         Principles of Consolidation.  The accompanying  condensed  consolidated
financial  statements of the Company were prepared in accordance  with generally
accepted  accounting  principles for interim financial  information and with the
instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do
not include all of the information and footnotes  required by generally accepted
accounting  principles  for  complete  financial  statements.  In the opinion of
management, all adjustments considered necessary for fair presentation have been
included.  Operating  results for the three and nine months  ended June 30, 1997
are not  necessarily  indicative  of the results  which may be expected  for the
fiscal year ending September 30, 1997. For additional information,  refer to the
consolidated  financial  statements for the fiscal year ended September 30, 1996
which are included in the Company's Form 10-K.

         The condensed  consolidated  financial statements include the Company's
wholly  owned  subsidiary,   Pilgrim  America  Group,  Inc.  ("PAG")  and  PAG's
subsidiaries,   Pilgrim  America  Investments,  Inc.,  a  registered  investment
advisor,  and Pilgrim  America  Securities,  Inc.,  a  registered  broker/dealer
(collectively "Pilgrim America").  Pilgrim America commenced operations upon the
acquisition  (the  "Acquisition")  of certain assets of Pilgrim  Group,  Inc. on
April 7, 1995. The condensed  consolidated financial statements also include the
Company's wholly-owned mortgage banking subsidiaries,  Express America TC, Inc.,
EAMC  Liquidation  Corp.,  the  successor  (as of December  27, 1996) to Express
America Mortgage  Corporation  ("EAMC"),  and EAMC's wholly-owned  subsidiaries,
Wesav Investment Corporation and Wesav Investment Inc.-2.

         Prior to April 7, 1995, the Company's  principal  business consisted of
mortgage banking activities,  including the origination,  sale, and servicing of
loans  collateralized by first mortgages on residential real estate. On February
28,  1995 the Company  announced  the  discontinuance  of the  remainder  of its
mortgage banking operations.  Consequently,  all of the operating results of the
Company's mortgage banking activities are reported as discontinued operations.

         After the  Acquisition,  the  continuing  operating  activities  of the
Company  consist  primarily  of  providing  investment  management  and  related
services to various open-end and closed-end investment companies operating under
the Pilgrim and Pilgrim  America names (the "Funds").  The results of continuing
operations reported in the condensed  consolidated  financial statements reflect
these investment management activities.

         Reclassifications.  Certain  reclassifications  have been made to prior
period financial statements to conform with current period presentation.
                                       6
<PAGE>
                       PILGRIM AMERICA CAPITAL CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS



         Costs  Assigned to Management  Contracts  Acquired.  Costs  assigned to
management  contracts  acquired  represents  the fair  value  of the  investment
management  rights  acquired  through the  Acquisition  and also  represents the
excess of the purchase price (including liabilities assumed) over the fair value
of net assets acquired and resulting costs from the  Acquisition.  These amounts
are being amortized on a straight-line basis over 25 years.

         The Company  analyzes costs assigned to management  contracts  acquired
periodically  to determine  whether any impairment in value has occurred.  Based
upon  anticipated  future income from  operations,  in the opinion of management
there has been no impairment.

         Income Tax. Deferred tax assets are initially  recognized for temporary
differences between the consolidated financial statement carrying amount and the
tax bases of assets  and  liabilities  which  will  result in future  deductible
amounts and operating loss and tax credit  carryforwards.  A valuation allowance
is then established to reduce the deferred tax asset to the level at which it is
"more  likely  than not" that the tax  benefits  will be  realized.  The Company
recorded an income tax benefit  during the nine months  ended June 30, 1997 as a
result of a change in the valuation  allowance  for the  Company's  deferred tax
asset.  The  change  in  the  valuation  allowance  resulted  from  management's
determination  that it is more likely than not that the  deferred  asset will be
realized.



Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS.

General

         The  Company  is a  holding  company  that,  through  its  wholly-owned
subsidiaries,  provides  investment  management  and  related  services  for six
open-end and two closed-end  funds (each a "Fund" and  collectively the "Pilgrim
America Funds" or the "Funds").  The Board of Directors of Pilgrim  America Bank
and  Thrift  Fund  approved  converting  the Fund from a  closed-end  fund to an
open-end fund subject to obtaining  shareholder  approval at a meeting scheduled
for October 16, 1997.

         The Company commenced its investment  management operations on April 7,
1995, when it consummated the acquisition (the  "Acquisition") of certain of the
net assets of Pilgrim Group, Inc. (now known as Atlas Financial Group, Inc.) for
$28.1 million.

         Prior to the  Acquisition,  the  Company  was  engaged in the  mortgage
banking business,  deriving revenues  primarily from mortgage loan servicing and
origination.  On February 28, 1995, the Company announced the  discontinuance of
all  remaining  mortgage  banking  operations  and  continues to  wind-down  its
mortgage operations by selling its remaining mortgage banking related assets.
                                       7
<PAGE>
Results of Operations

         The following table presents comparative  quarterly data regarding Fund
assets  under  management  and Fund sales for the five  quarters  ended June 30,
1997:
<TABLE>
<CAPTION>
                                              Pilgrim America Funds
                                        Selected Fund Data (Unaudited)
                                                  ($000,000)
                        -----------------------------------------------------------------
                        June 30,      September 30,  December 31,  March 31,     June 30,
                          1996            1996          1996        1997          1997
-------------------     --------      -------------  ------------  ---------     --------
<S>                     <C>           <C>            <C>           <C>           <C>     
Direct Sales            $   40.5      $   38.3       $   49.0      $   74.0      $   60.7
Exchanges Out (1)           (1.2)         (0.5)          (1.1)          0.4          (1.1)
Redemptions                 (9.1)         (9.8)         (15.9)        (16.6)        (30.8)
                        --------      --------       --------      --------      --------
Net Sales               $   30.2      $   28.0       $   32.0      $   57.8      $   28.8
                        ========      ========       ========      ========      ========
Ending Assets Under
Management (2)          $1,451.7      $1,704.5       $2,022.6      $2,138.0      $2,288.9
                        ========      ========       ========      ========      ========
</TABLE>

(1)  Net Exchanges from (to) the Company's sponsored money market fund.
(2)  Includes net assets plus borrowings by Pilgrim America Prime Rate Trust for
     investment  purposes of $345 million,  $323 million,  $286 million and $179
     million at June 30, 1997,  March 31, 1997,  December 31, 1996 and September
     30, 1996, respectively.



Quarter Ended June 30, 1997 Compared to the Quarter Ended June 30, 1996

         Net earnings for the June 30, 1997 quarter amounted to $1.5 million, or
$0.36 per share  compared to a net loss of $642,000,  or $0.13 per share for the
quarter ended June 30, 1996. Net earnings for the June 30, 1997 quarter  consist
of net earnings from the Company's continuing  investment management business of
$1.1 million,  or $0.26 per share,  and net earnings from the  operations of the
discontinued mortgage business of $413,000 or $0.10 per share.

         Revenues.  Revenues  for the June 30, 1997  quarter  increased  by $2.1
million over  revenues for the June 30, 1996 quarter.  This  increase  primarily
resulted from an increase in management and administrative fees of $1.4 million.
Management and  administrative  fees are based on assets under  management which
averaged $2.20 billion  during the current  quarter and $1.43 billion during the
June 30, 1996 quarter.

         In addition,  higher sales of open-end funds during the current quarter
as compared to the June 30, 1996 quarter resulted in increased distribution fees
of  $349,000.  Distribution  fees are  realized  from the sale of  certain  fund
shares.

         Investment and other income for the June 30, 1997 quarter  increased by
$368,000  primarily as a result of a reduction of loss  allowances  related to a
certain  note  receivable  held in  connection  with the  Company's  sale of the
mortgage banking servicing operations.

         Expenses.  Total expenses for the current quarter decreased by $437,000
compared  to the June 30, 1996  quarter.  This  decrease  in expenses  primarily
resulted  from  lower  personnel  costs  due to a  reduction  in staff and lower
selling expenses.
                                       8
<PAGE>
         Amortization and depreciation expenses increased by $45,000 between the
two  quarters  primarily  as a result  of an  increase  in the  amortization  of
deferred  acquisition costs.  Deferred acquisition costs are commissions paid on
the sale of certain fund shares. These commissions are capitalized and amortized
over a six-year period.

         Earnings from discontinued  mortgage  operations,  net of tax. Earnings
from discontinued mortgage operations,  net of tax increased by $413,000 for the
current quarter  compared to the quarter ended June 30, 1996, as a result of the
reduction of certain loss allowances related to that business.


Nine Months Ended June 30, 1997 Compared to the Nine Months Ended June 30, 1996.

         Net  earnings  for the nine  months  ended  June 30,  1997  were  $10.5
million,  or $2.56 per share,  compared to a net loss of $1.8 million,  or $0.38
per share for the nine months ended June 30, 1996.  Net earnings for the current
reporting  period  consisted  of net  earnings  from  the  Company's  continuing
investment  management  business of $10.1 million,  or $2.46 per share,  and net
earnings from the operation of the discontinued mortgage business of $413,000 or
$0.10 per share.

         Revenues. Revenues for the nine months ended June 30, 1997 increased by
$5.0  million  over  revenues  for the nine  months  ended June 30,  1996.  This
increase  primarily  resulted from an increase in management and  administrative
fees of $3.6 million.  Management  and  administrative  fees are based on assets
under  management  which  averaged $2.0 billion  during the first nine months of
fiscal 1997 and $1.4 billion during the first nine months of fiscal 1996.

         In  addition,  higher  sales  of  open-end  funds  during  the  current
reporting  period as compared to the June 30, 1996 reporting  period resulted in
increased distribution fees of $902,000. Distribution fees are realized from the
sale of certain fund shares.

         Investment  and other  income for the nine  months  ended June 30, 1997
increased by $553,000  primarily  as a result of a reduction of loss  allowances
related to a certain note  receivable held in connection with the Company's sale
of the mortgage banking servicing operations.

         Expenses.  Total  expenses  for the nine  months  ended  June 30,  1997
decreased by $1.1 million  compared to the nine months ended June 30, 1996. This
decrease  primarily  resulted from lower  personnel  costs due to a reduction in
staff and lower selling expenses.

         Amortization  and depreciation  expenses  increased by $191,000 between
the  two  reporting  periods  primarily  as a  result  of  an  increase  in  the
amortization  of deferred  acquisition  costs.  Deferred  acquisition  costs are
commissions  paid on the sale of certain  fund  shares.  These  commissions  are
capitalized and amortized over a six year period.

         Earnings from discontinued  mortgage  operations,  net of tax. Earnings
from discontinued mortgage operations,  net of tax increased by $413,000 for the
current nine months compared to the nine months ended June 30, 1996, as a result
of the reduction of certain loss allowances related to that business.
                                       9
<PAGE>
Liquidity

         The Company  intends to  continue  funding  its  investment  management
operations with cash provided by operations and with  borrowings  obtained under
its credit  agreement.  The Company  believes  that it will have  adequate  cash
necessary to meet expected cash needs both from cash generated  from  operations
and borrowings available under its credit agreement.

         On July 31, 1997,  the Company and its lender  amended and restated its
credit  agreement.  The new  agreement  allows  the  Company to borrow up to $20
million for any  corporate  purpose  including:  (i) general  corporate  working
capital,  (ii) acquisition of investment  management rights,  (iii) financing of
commissions  paid  by the  Company  on  certain  mutual  fund  shares  and  (iv)
repurchasing the Company's stock.

         On  August  5,  1997,  the  Company's   Board  of  Directors   approved
repurchasing  up to 500,000 shares of its common stock from time to time in open
market  transactions.  The Company will use cash  generated  from  operations or
borrowings obtained under its credit agreement to acquire the shares.
                                       10
<PAGE>
                           PART II - OTHER INFORMATION


Item 1. LEGAL PROCEEDINGS

         On May 23, 1997 the Company  entered into an agreement with the Federal
Deposit  Insurance  Corporation  ("FDIC") to settle all claims in a civil action
filed in December 1995 by the FDIC in the United States District Court, District
of Arizona.  The FDIC action against the Company and other defendants  sought at
least $20 million in actual  damages and $80 million in punitive  damages.  This
settlement  covers all FDIC claims  asserted  against the Company and certain of
its officers and directors.

The Company settled with its Director and Officer  liability  insurance  carrier
under the policy providing coverage for this matter.

No charge to earnings resulted from this settlement.


Item 6. EXHIBITS AND REPORTS ON FORM 8-K.

(a)      Exhibits

         10.1     Second Amended and Restated Credit  Agreement dated as of July
                  31, 1997 by and between Pilgrim America Group,  Inc. and First
                  Bank National Association.

         27.0     Financial Data Schedules

(b)      Reports on Form 8-K.

         During the quarter  ended June 30, 1997,  the Company filed one Current
         Report on Form 8-K relating to an event of April 25, 1997.
                                       11
<PAGE>
                                   SIGNATURES



         Pursuant to the  requirements of Section 13 of the Securities  Exchange
Act of 1934,  the Company has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.




                                        PILGRIM AMERICA CAPITAL CORPORATION



Date:  August 7, 1997                        /s/ James R. Reis
                                             -----------------
                                              James R. Reis
                                              Vice-Chairman and Chief Financial
                                              Officer (Principal Accounting 
                                              Officer)