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  March  31, 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.


           3,864,130 Shares of Common Stock outstanding on May 9, 1997
           -----------------------------------------------------------
<PAGE>
                                      INDEX


<TABLE>
<CAPTION>
 PART I.  FINANCIAL INFORMATION                                                                            Page
                                                                                                           ----
<S>                      <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............................................................      10

           Item 4.       Submission of Matters to a Vote of Security Holders..........................      10

           Item 6.       Exhibits and Reports on Form 8-K.............................................      10

           Signatures.................................................................................      11
</TABLE>
                                       2
<PAGE>
Item 1.  FINANCIAL STATEMENTS


PILGRIM AMERICA CAPITAL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except share amounts)
<TABLE>
<CAPTION>
                                                                         March 31,        September 30,
                                                                           1997               1996
--------------------------------------------------------------------------------------------------------
<S>                                                                   <C>                <C>           
Assets
     Cash and cash equivalents                                        $          160     $          238
     Investments                                                               2,449              2,462
     Accounts receivable                                                         240                216
     Notes receivable                                                          3,623              3,587
     Costs assigned to management contracts acquired, less
         accumulated amortization of $2,588 and $1,943                        29,675             30,320
     Furniture, fixtures and equipment, less accumulated depreciation 
         of $1,452 and $1,378                                                    983              1,144  
     Deferred taxes                                                            8,539              1,750
     Deferred acquisition costs, less accumulated amortization of
         $368 and $131                                                         3,753              1,939
     Other assets                                                              1,157                899
                                                                      ---------------    ---------------
Total assets                                                          $       50,579             42,555
                                                                      ===============    ===============

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

Liabilities and stockholders' equity
Liabilities:
     Net liabilities of discontinued operations                       $        5,491     $        3,392
     Notes payable                                                             3,915              3,600
     Accounts payable and accrued expenses                                     2,476              5,775
                                                                      ---------------    ---------------
             Total liabilities                                                11,882             12,767
                                                                      ---------------    ---------------


Stockholders' equity:
     Common stock, $.01 par value, 10,000,000 shares authorized,      
         5,377,860 shares issued, with 3,860,130 shares outstanding               54                 54 
     Additional paid-in capital                                               48,759             48,759 
     Less:  Treasury stock, 1,517,730 shares                                  (8,623)            (8,623)
     Unrealized gain on investments                                              266                333 
     Accumulated deficit                                                      (1,759)           (10,735)
                                                                      ---------------    ---------------
             Total stockholders' equity                                       38,697             29,788 
                                                                      ---------------    ---------------
     Total liabilities and stockholders' equity                       $       50,579     $       42,555 
                                                                      ===============    ===============

--------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes to condensed consolidated financial statements.
                                       3
<PAGE>
PILGRIM AMERICA CAPITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
                                                      Three Months Ended               Six Months Ended
                                                          March 31,                       March 31,
-------------------------------------------------------------------------------------------------------------
                                                     1997            1996            1997            1996
-------------------------------------------------------------------------------------------------------------
<S>                                               <C>             <C>             <C>             <C>        
Revenues
    Management and administrative fees            $     4,244     $   3,011       $    8,174      $    5,992 
    Distribution fees                                     552           254            1,018             466 
    Investment and other income                           274           224              538             353 
                                                  ------------    -----------     -----------     -----------
        Total revenues                                  5,070         3,489            9,730           6,811 
                                                  ------------    -----------     -----------     -----------

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

Expenses
    General and administrative                          1,868         1,874            3,791           3,931 
    Selling                                             1,211         1,776            2,455           3,123 
    Amortization and depreciation                         569           483            1,097             951 
                                                  ------------    -----------     -----------     -----------
        Total expenses                                  3,648         4,133            7,343           8,005 
                                                  ------------    -----------     -----------     -----------

    Earnings (loss) before taxes                        1,422          (644)           2,387          (1,194)

    Tax benefit                                         6,589            --            6,589              -- 
                                                  ------------    -----------     -----------     -----------

Net earnings (loss)                               $     8,011     $    (644)      $    8,976      $   (1,194)
                                                  ===========     ==========      ===========     ===========

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

Net earnings (loss) per common and common
    share equivalent                              $      1.97     $   (0.13)            2.24           (0.24)
                                                  ============    ==========     ===========     ===========

Shares used in per share calculation                4,066,328     4,877,860        4,006,047       4,877,860 
                                                  ============    ==========     ===========     ===========

-------------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes to condensed consolidated financial statements.
                                        4
<PAGE>
PILGRIM AMERICA CAPITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands)
<TABLE>
<CAPTION>
                                                                               For the Six Months
                                                                                Ended March 31,
-------------------------------------------------------------------------------------------------------------
                                                                             1997               1996
-------------------------------------------------------------------------------------------------------------
<S>                                                                     <C>               <C>         

Cash flows from operating activities
Net earnings (loss)                                                       $    8,976        $    (1,194)
Adjustments to reconcile net earnings (loss) to net cash used in
     operating activities:
    Amortization and depreciation                                              1,097                951 
    Increase in accounts receivable                                              (60)              (249)
    Decrease in operating liabilities                                         (3,299)              (361)
    Increase in deferred acquisition costs                                    (2,061)              (689)
    Increase in deferred tax asset                                            (6,789)                -- 
    (Increase) decrease in other operating assets                               (279)                36 
                                                                        --------------    ---------------
Net cash used in operating activities                                         (2,415)            (1,506)
                                                                        --------------    ---------------

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

Cash flows from investing activities
    Investment in Pilgrim America Funds                                          (54)                -- 
    Sales of furniture, fixtures and equipment                                     8                115 
    Purchases of furniture, fixtures and equipment                               (31)              (208)
    Cash provided by discontinued operations                                   2,099                779 
                                                                        --------------    ---------------
Net cash provided by investing activities                                      2,022                686 
                                                                        --------------    ---------------

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

Cash flows from financing activities
    Redemption of preferred stock                                                  --               (338)
    Term debt borrowing                                                          315                  -- 
                                                                        --------------    ---------------
    Net cash provided by (used in) financing activities                          315               (338)
                                                                        --------------    ---------------
    Net decrease in cash and cash equivalents                                    (78)            (1,158)
    Cash and cash equivalents, beginning of period                               238              1,858 
                                                                        --------------    ---------------
Cash and cash equivalents, end of period                                  $      160        $       700 
                                                                        ==============    ===============

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

Supplemental disclosures
    Interest paid                                                         $      212       $         35 
    Income taxes paid                                                            --                   2 

-------------------------------------------------------------------------------------------------------------
</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 six months  ended March 31, 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 loss from  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 three months ended March 31, 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 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.

Results of Operations

         The following table presents comparative  quarterly data regarding Fund
assets under  management  and Fund sales for the five  quarters  ended March 31,
1997:
                                       7
<PAGE>
<TABLE>
<CAPTION>
                                                        Pilgrim America Funds
                                                    Selected Fund Data (Unaudited)
                                                              ($000,000)
                             -----------------------------------------------------------------------------
                              March 31,      June 30      September 30,      December 31,       March 31,
                                1996          1996            1996              1996              1997
                             -----------    ---------    ---------------    --------------     -----------
<S>                          <C>            <C>          <C>                <C>                <C>       
    Direct Sales             $     31.5     $   40.5     $         38.3     $        49.0      $     74.0
    Exchanges Out (1)              (1.8)        (1.2)              (0.5)             (1.1)            0.4
    Redemptions                   (11.0)        (9.1)              (9.8)            (15.9)          (16.6)
                             -----------    ---------    ---------------    --------------     -----------
    Net Sales                $     18.7     $   30.2     $         28.0     $        32.0      $     57.8
                             ===========    =========    ===============    ==============     ===========
    Ending Assets Under
    Management (2)           $  1,413.1     $1,451.7     $      1,704.5     $     2,022.6      $  2,138.0
                             ===========    =========    ===============    ==============     ===========
</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 $323 million , $286 million and $179 million at March
    31, 1997, December 31, 1996 and September 30, 1996, respectively.




Quarter Ended March 31, 1997 Compared to the Quarter Ended March 31, 1996

         Net earnings for the March 31, 1997 quarter  amounted to $8.0  million,
or $1.97 per share  compared to a net loss of  $644,000,  or $0.13 per share for
the quarter  ended March 31,  1996.  Net earnings for the March 31, 1997 quarter
consist of pre-tax income from the Company's  continuing  investment  management
business of $1.4 million, or $0.35 per share, and a tax benefit of $6.6 million,
or $1.62 per share, related to prior operating losses.

         Revenues.  Revenues  for the March 31, 1997  quarter  increased by $1.6
million over  revenues for the March 31, 1996 quarter.  This increase  primarily
resulted from an increase in management and administrative fees of $1.2 million.
Management and  administrative  fees are based on assets under  management which
averaged $2.07 billion  during the current  quarter and $1.39 billion during the
March 31, 1996 quarter.

         In addition,  higher sales of open-end funds during the current quarter
as compared to the March 31, 1996  quarter  resulted in  increased  distribution
fees of $298,000.  Distribution  fees are realized from the sale of certain fund
shares.

         Expenses.  Total expenses for the current quarter decreased by $485,000
compared  to the March 31, 1996  quarter.  This  decrease in expenses  primarily
resulted  from  lower  personnel  costs  due to a  reduction  in staff and lower
selling expenses.

         Amortization and depreciation expenses increased by $86,000 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.
                                       8
<PAGE>
Six Months Ended March 31, 1997 Compared to the Six Months Ended March 31,1996.

         Net earnings for the six months ended March 31, 1997 were $9.0 million,
or $2.24 per share,  compared to a net loss of $1.2 million,  or $0.24 per share
for the six months ended March 31, 1996. Net earnings for the current  reporting
period  consisted of pre-tax  income from the  Company's  continuing  investment
management  business of $2.4 million,  or $0.60 per share,  and a tax benefit of
$6.6 million, or $1.64 per share, related to prior operating losses.

         Revenues. Revenues for the six months ended March 31, 1997 increased by
$2.9  million  over  revenues  for the six months  ended  March 31,  1996.  This
increase  primarily  resulted from an increase in management and  administrative
fees of $2.2 million.  Management  and  administrative  fees are based on assets
under  management  which  averaged $2.0 billion  during the first half of fiscal
1997 and $1.4 billion during the first half of 1996.

         In  addition,  higher  sales  of  open-end  funds  during  the  current
reporting  period as compared to the March 31, 1996 reporting period resulted in
increased distribution fees of $552,000. Distribution fees are realized from the
sale of certain fund shares.

         Expenses.  Total  expenses  for the six  months  ended  March 31,  1997
decreased  by $662,000  compared to the six months  ended March 31,  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 $146,000 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.



Liquidity

         The Company  intends to  continue  funding  its  investment  management
operations with cash provided by operations and with  borrowings  obtained under
its credit  agreement  discussed in the Company's Annual Report on Form 10-K for
the year ended  September  30,  1996.  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.  The
Company's  ability to borrow under its credit  agreement  expires July 1997. The
Company expects to either extend its credit facility,  replace it or simply rely
on cash generated from operations.
                                       9
<PAGE>
                           PART II - OTHER INFORMATION


Item 1.   LEGAL PROCEEDINGS

         The Company  acquired its now discontinued  mortgage banking  operation
from the  Resolution  Trust  Corporation  ("RTC") on May 16,  1991  following  a
competitive bidding process. The Company previously disclosed that the RTC filed
a complaint in the United States District Court, District of Arizona on December
8, 1995,  against the Company and other  defendants.  The RTC asked for at least
$20 million in actual damages and at least $60 million in punitive  damages from
all  defendants.  The RTC ceased  operating on December  31,1995 and the Federal
Deposit Insurance Corporation (the "FDIC") assumed responsibility for the case.

         The Company notified its Officer and Director  liability carrier of the
FDIC  action in January  1996  seeking  coverage as  permitted  by the policy in
connection  with the  losses  which it may  incur  in  connection  with the FDIC
action.  On March 19, 1997, the Company  received a payment from the Officer and
Director liability carrier in settlement of the Company's claim.

         The Company and the FDIC have reached  preliminary  agreement to settle
all claims in this action and a written  settlement  agreement is being prepared
by the FDIC.  Upon  execution  of the  written  agreement,  the  action  will be
dismissed  with  prejudice.   No  charge  to  earnings  will  result  from  this
settlement.


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

         The Company's  annual meeting of stockholders  was held on February 26,
1997,  for the purpose of  electing  two  directors  to the  Company's  Board of
Directors. At the meeting, a quorum being present, votes cast in the election of
directors were as follows:

<TABLE>
<CAPTION>
Nominee                    Votes For        Votes Against       Votes Withheld          Broker Nonvotes
-------                    ---------        -------------       --------------          ---------------
<S>                        <C>                     <C>               <C>                         <C>
Roy A. Herberger, Jr.      3,485,163               0                 23,240                      0

Stephen A McConnell        3,485,163               0                 23,240                      0
</TABLE>

         No matters  other than the  election of two  directors  were before the
meeting.


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

(a)      Exhibits

         10.1     Performance  Share Plan.  Incorporated by reference to Exhibit
                  4.1 in the  Registrant's  Registration  Statement  on Form S-8
                  (SEC File No. 333-23051)

         27.0     Financial Data Schedules

(b)      Reports on Form 8-K.
         None.
                                       10
<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:  May 9, 1997                  By: /s/ James R. Reis 
                                       ------------------------------------
                                       James R. Reis
                                       Vice-Chairman and Chief Financial Officer
                                       (Principal Accounting Officer)
  
                                       11