<PAGE>


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

                                    FORM 10-Q

(Mark one)

[X]  Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934

            For the quarterly period ended March 31, 2002

                                       Or

[ ]  Transition Report Pursuant to Section 13 or 15(d) of the Securities
     Exchange Act of 1934

            For the transition period from __________ to ___________

                        Commission File Number 000-24051

                          UNITED PANAM FINANCIAL CORP.
             (Exact name of Registrant as specified in its charter)

            California                                   95-3211687
   (State or other jurisdiction of                    (I.R.S. Employer
    incorporation or organization)                  Identification Number)

                         3990 Westerly Place, Suite 200
                             Newport Beach, CA 92660
               (Address of principal executive offices) (Zip Code)

                                 (949) 224-1917
              (Registrant's telephone number, including area code)


      (Former name, former address and former fiscal year, if changed since
                                  last report)


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
                                                      ---         ---

The number of shares outstanding of the Registrant's Common Stock as of May 1,
2002 was 15,571,400 shares.

<PAGE>

                          UNITED PANAM FINANCIAL CORP.
                                    FORM 10-Q
                                 MARCH 31, 2002

                                      INDEX


PART I.     FINANCIAL INFORMATION                                          Page
                                                                           ----
Item 1.     Financial Statements (unaudited)

            Consolidated Statements of Financial Condition as of
               March 31, 2002 and December 31, 2001                          1

            Consolidated Statements of Operations
               for the three months ended March 31, 2002
               and March 31, 2001                                            2

            Consolidated Statements of Comprehensive Income
               for the three months ended March 31, 2002
               and March 31, 2001                                            3

            Consolidated Statements of Cash Flows
               for the three months ended March 31, 2002
               and March 31, 2001                                            4

            Notes to Consolidated Financial Statements                       6

Item 2.     Management's Discussion and Analysis of

               Financial Condition and Results of Operations                 8

Item 3.     Quantitative and Qualitative Disclosures About Market Risk      18

PART II.    OTHER INFORMATION

Item 1.     Legal Proceedings                                               19

Item 2.     Changes in Securities and Use of Proceeds                       19

Item 3.     Defaults Upon Senior Securities                                 19

Item 4.     Submission of Matters to a Vote of Security Holders             19

Item 5.     Other Information                                               19

Item 6.     Exhibits and Reports on Form 8-K                                19

<PAGE>

PART I.                             FINANCIAL INFORMATION

Item 1.     Financial Statements.
            --------------------

                 United PanAm Financial Corp. and Subsidiaries
                 Consolidated Statements of Financial Condition
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                             March 31,           December 31,
(Dollars in thousands)                                                          2002                 2001
                                                                          -----------------    -----------------
<S>                                                                       <C>                  <C>
Assets

Cash and due from banks                                                           $ 8,236              $ 5,428
Short term investments                                                             44,655              135,267
                                                                          -----------------    -----------------
 Cash and cash equivalents                                                         52,891              140,695
Securities available for sale, at fair value                                      402,060              284,837
Loans, net                                                                        255,503              236,448
Loans held for sale                                                                   119                  194
Premises and equipment, net                                                         2,300                2,124
Federal Home Loan Bank stock, at cost                                               6,581                6,500
Accrued interest receivable                                                         4,491                4,029
Other assets                                                                       14,287               14,746
                                                                          -----------------    -----------------
   Total assets                                                                 $ 738,232             $689,573
                                                                          =================    =================

Liabilities and Shareholders' Equity

Deposits                                                                        $ 372,732             $357,350
Federal Home Loan Bank advances                                                   104,000              130,000
Repurchase agreements                                                             171,466              114,776
Accrued expenses and other liabilities                                             12,264               11,781
                                                                          -----------------    -----------------
   Total liabilities                                                            $ 660,462             $613,907
                                                                          -----------------    -----------------

Common stock (no par value):
   Authorized, 30,000,000 shares
   Issued and outstanding, 15,571,400 shares at March 31, 2002
   and December 31, 2001                                                        $  63,630             $ 63,630
Retained earnings                                                                  13,954               11,287
Unrealized gain on securities available for sale, net                                 186                  749
                                                                          -----------------    -----------------
   Total shareholders' equity                                                      77,770               75,666
                                                                          -----------------    -----------------

   Total liabilities and shareholders' equity                                   $ 738,232            $ 689,573
                                                                          =================    =================
</TABLE>

See notes to consolidated financial statements

                                       1

<PAGE>

                  United PanAm Financial Corp. and Subsidiaries
                      Consolidated Statements of Operations
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                          Three Months
(In thousands, except per share data)                                   Ended March 31,
                                                                  -----------------------------
                                                                     2002             2001
                                                                  ------------     ------------
<S>                                                               <C>              <C>
Interest Income
   Loans                                                            $ 13,037         $ 10,290
   Short term investments                                              2,659            3,640
                                                                  ------------     ------------
        Total interest income                                         15,696           13,930
                                                                  ------------     ------------

Interest Expense
   Deposits                                                            3,232            5,020
   Repurchase agreements                                                 193               --
   Federal Home Loan Bank advances                                       571              515
                                                                  ------------     ------------
         Total interest expense                                        3,996            5,535
                                                                  ------------     ------------
             Net interest income                                      11,700            8,395
   Provision for loan losses                                              85               44
                                                                  ------------     ------------
             Net interest income after provision for loan losses      11,615            8,351
                                                                  ------------     ------------

Non-interest Income
   Services charges and fees                                             191              165
   Loan related charges and fees                                          85               75
   Gain on sale of securities                                             61               --
   Gain on sale of loans                                                  --              357
   Other income                                                           29               33
                                                                  ------------     ------------
         Total non-interest income                                       366              630
                                                                  ------------     ------------

Non-interest Expense
   Compensation and benefits                                           4,810            3,709
   Occupancy                                                             874              764
   Other                                                               2,195            1,979
                                                                  ------------     ------------
        Total non-interest expense                                     7,879            6,452
                                                                  ------------     ------------

Income before income taxes and cumulative effect of change in
accounting principle                                                   4,102            2,529

Income taxes                                                           1,541              985
                                                                  ------------     ------------

Income before cumulative effect of change in accounting
principle                                                              2,561            1,544

Cumulative effect of change in accounting principle, net of tax          106               --

   Net Income                                                       $  2,667         $  1,544
                                                                  ------------     ------------

Earnings per share-basic:

Net income before cumulative effect of change in accounting
principle                                                           $   0.16         $   0.10

Cumulative effect of change in accounting principle                     0.01               --
                                                                  ------------     ------------

    Net Income                                                      $   0.17         $   0.10
                                                                  ============     ============

    Weighted average shares outstanding                               15,571           16,153
                                                                  ============     ============

Earnings per share-diluted:

Net income before cumulative effect of change in accounting
principle                                                           $   0.15         $   0.10

Cumulative effect of change in accounting principle                       --               --
                                                                  ------------     ------------

    Net Income                                                      $   0.15         $   0.10
                                                                  ============     ============

    Weighted average shares outstanding                               17,338           16,227
                                                                  ============     ============
</TABLE>

See notes to consolidated financial statements.

                                       2






<PAGE>

                  United PanAm Financial Corp. and Subsidiaries
                 Consolidated Statements of Comprehensive Income
                                   (Unaudited)

                                                        Three Months
(In thousands)                                         Ended March 31,
                                            ------------------------------------
                                                 2002                2001
                                            ----------------    ----------------

Net income                                         $ 2,667             $ 1,544
Other comprehensive income, net of tax
     Unrealized gain (loss) on securities            (563)                 145
                                            ----------------    ----------------
Comprehensive income                               $ 2,104             $ 1,689
                                            ================    ================


See notes to consolidated financial statements.

                                       3

<PAGE>

                  United PanAm Financial Corp. and Subsidiaries
                      Consolidated Statements of Cash Flows
                                   (Unaudited)
<TABLE>
<CAPTION>

(Dollars in thousands)                                                                           Three Months
                                                                                                Ended March 31,
                                                                                         ------------------------------
                                                                                             2002            2001
                                                                                         --------------  --------------
<S>                                                                                      <C>             <C>
Cash Flows from Operating Activities
Net income                                                                                   $ 2,667        $  1,544

Adjustments to reconcile net income (loss) to net cash provided by (used in)
 operating activities:
   Gain of sale of investment securities                                                         (61)             --
   Sales of mortgage loans (net of gain)                                                          --          14,381
   Provision for loan losses                                                                      85              44
   Depreciation and amortization                                                                 215             248
   FHLB stock dividend                                                                           (82)            (48)
   Increase in accrued interest receivable                                                      (462)         (1,438)
   Decrease in residual interests in securitizations                                              --           8,861
   Writedown of investment in common stock                                                        --             500
   Decrease (increase) in other assets                                                           778            (339)
   Increase (decrease) in accrued expenses and other liabilities                                 483          (1,460)
   Amortization of premiums (discounts) on investment securities                               1,905            (506)
   Other, net                                                                                     --             (24)
                                                                                         --------------  --------------
     Net cash provided by operating activities                                                 5,528          21,763
                                                                                         --------------  --------------

Cash Flows from Investing Activities
   Purchase of investment securities                                                        (202,287)       (107,166)
   Proceeds from maturities of investment securities                                          52,331         140,091
   Proceeds from sale of investment securities                                                30,007              --
   Repayments of mortgage loans                                                                   74             899
   Originations, net of repayments, of non-mortgage loans                                    (19,138)        (15,345)
   Purchase of premises and equipment                                                           (391)           (384)
   Proceeds from sales of real estate owned                                                       --             504
   Other, net                                                                                     --            (124)
                                                                                         --------------  --------------
     Net cash provided by (used in) investing activities                                    (139,404)          18,475
                                                                                         --------------  --------------

Cash Flows from Financing Activities
   Net increase in deposits                                                                   15,382           7,325
   Proceeds of repurchase agreements                                                          56,690              --
   Repayments of FHLB advances                                                               (26,000)             --
                                                                                         --------------  --------------
      Net cash provided by financing activities                                               46,072           7,325
                                                                                         --------------  --------------

Net increase (decrease) in cash and cash equivalents                                         (87,804)         47,563

Cash and cash equivalents at beginning of period                                             140,695          52,643
                                                                                         --------------  --------------

Cash and cash equivalents at end of period                                                   $52,891        $100,206
                                                                                         ==============  ==============
</TABLE>

See notes to consolidated financial statements.

                                       4

<PAGE>

                  United PanAm Financial Corp. and Subsidiaries
                Consolidated Statements of Cash Flows, Continued
                                   (Unaudited)

(Dollars in thousands)
                                                        Three Months Ended
                                                            March 31,
                                                   -----------------------------
                                                       2002            2001
                                                   -------------   -------------
Supplemental Disclosures of Cash Flow Information

     Cash paid for:

       Interest
                                                       $ 10,474         $ 5,087
                                                   =============   =============
       Income taxes
                                                       $    393         $ 1,199
                                                   =============   =============
Supplemental Schedule of Non-cash Investing and
       Financing Activities

       Loans transferred to held for sale                    --         $13,669
                                                   =============   =============


See notes to consolidated financial statements.

                                       5

<PAGE>

                  United PanAm Financial Corp. and Subsidiaries
                   Notes to Consolidated Financial Statements
                   Three Months Ended March 31, 2002 and 2001
                                   (Unaudited)

1.       Organization

         United PanAm Financial Corp. (the "Company") was incorporated in
California on April 9, 1998 for the purpose of reincorporating its business in
that state, through the merger of United PanAm Financial Corp., a Delaware
corporation (the "Predecessor"), into the Company. Unless the context indicates
otherwise, all references herein to the "Company" include the Predecessor. The
Company was originally organized as a holding company for Pan American
Financial, Inc. ("PAFI") and Pan American Bank, FSB (the "Bank") to purchase
certain assets and assume certain liabilities of Pan American Federal Savings
Bank from the Resolution Trust Corporation (the "RTC") on April 29, 1994. The
Company, PAFI and the Bank are considered to be Hispanic owned. PAFI is a wholly
owned subsidiary of the Company, and the Bank is a wholly owned subsidiary of
PAFI.

2.       Basis of Presentation

         The accompanying unaudited consolidated financial statements include
the accounts of United PanAm Financial Corp., Pan American Financial, Inc. and
Pan American Bank, FSB. Substantially all of the Company's revenues are derived
from the operations of the Bank and they represent substantially all of the
Company's consolidated assets and liabilities as of March 31, 2002 and December
31, 2001. Significant inter-company accounts and transactions have been
eliminated in consolidation.

         These consolidated financial statements have been prepared in
accordance with accounting principles generally accepted in the United States of
America ("GAAP") for interim financial information and the instructions to Form
10-Q and Article 10 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 (consisting of normal recurring accruals) considered necessary for a
fair presentation of the Company's financial condition and results of operations
for the interim periods presented in this Form 10-Q have been included.
Operating results for the interim periods are not necessarily indicative of
financial results for the full year. These unaudited consolidated financial
statements should be read in conjunction with the audited consolidated financial
statements and notes thereto included in the Company's Annual Report on Form
10-K for the year ended December 31, 2001.

         The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

                                       6

<PAGE>

3.       Earnings Per Share

         Basic EPS and diluted EPS are calculated as follows for the three
months ended March 31, 2002 and March 31, 2001:

<TABLE>
<CAPTION>


                                                                                                       Three Months

(In thousands, except per share amounts)                                                              Ended March 31,
                                                                                                ----------------------------
                                                                                                   2002            2001
                                                                                                ------------    ------------
<S>                                                                                             <C>             <C>
Earnings per share - basic:
     Income before cumulative effect of change in accounting principle                              $ 2,561         $ 1,544
     Net income                                                                                     $ 2,667         $ 1,544
                                                                                                ============    ============
     Average common shares outstanding                                                               15,571          16,153
                                                                                                ============    ============
     Per share before the cumulative effect of change in accounting principle                       $  0.16         $  0.10
                                                                                                ============    ============
     Per share                                                                                      $  0.17         $  0.10
                                                                                                ============    ============
Earnings per share - diluted:

     Income before cumulative effect of change in accounting principle                              $ 2,561         $ 1,544
     Net income                                                                                     $ 2,667         $ 1,544
                                                                                                ============    ============
     Average common shares outstanding                                                               15,571          16,153
     Add: Stock options                                                                               1,767              74
                                                                                                ------------    ------------
     Average common shares outstanding - diluted                                                     17,338          16,227
     Per share before cumulative effect of change in accounting principle                           $  0.15         $  0.10
                                                                                                ============    ============
     Per share                                                                                      $  0.15         $  0.10
                                                                                                ============    ============
</TABLE>

4.       Accounting Pronouncements

         In July 2001, the Financial Accounting Standards Board (the "FASB")
issued SFAS No. 141, "Business Combinations", and SFAS No. 142, "Goodwill and
Other Intangible Assets." SFAS No.141 requires that the purchase method of
accounting be used for all business combinations initiated after June 30, 2001
as well as all purchase method business combinations completed after June 30,
2001. SFAS No.141 also specifies criteria intangible assets acquired in a
purchase method business combination must meet to be recognized and reported
apart from goodwill. The Company adopted the statement on January 1, 2002. The
adoption of this statement did not have a material effect on UPFC.

         SFAS No.142 requires that goodwill and intangible assets with
indefinite useful lives no longer be amortized, but instead tested for
impairment at least annually in accordance with the provisions of SFAS No.142.
SFAS No.142 also requires that intangible assets with definite useful lives be
amortized over their respective estimated useful lives to their estimated
residual values, and reviewed for impairment. As required by SFAS No.142, UPFC
adopted the new standard in the first quarter of the fiscal year 2002. Beginning
on January 1, 2002, amortization of negative goodwill and intangibles with
indefinite lives ceased. The adoption resulted in an increase in income of
$169,000 before tax and $106,000 after tax.

         In June 2001, the FASB issued SFAS No. 143, "Accounting for Asset
Retirement Obligations," which requires that the fair value of a liability for
an asset retirement obligation be recognized in the period in which it is
incurred if a reasonable estimate of fair value can be made. The associated
asset retirement costs would be capitalized as part of the carrying amount of
the long-lived asset and depreciated over the life of the asset. The liability
is accreted at the end of each period through charges to operating expense. If
the obligation is settled for other than the carrying amount of the liability,
UPFC will recognize a gain or loss on settlement. The provisions of SFAS No.143
are effective for fiscal years beginning after June 15, 2002. The adoption of
this statement will have no impact on UPFC.

5.       Operating Segments

         The Company has three reportable segments: auto finance, insurance
premium finance and banking. The auto finance segment acquires, holds for
investment and services nonprime retail automobile installment sales contracts
generated by franchised and independent dealers of used automobiles. The
insurance premium finance

                                       7

<PAGE>


segment underwrites and finances automobile and commercial insurance premiums in
California. The banking segment operates a four-branch federal savings bank and
is the principal funding source for the Company's auto and insurance premium
finance segments.

         The accounting policies of the segments are the same as those of the
Company's except for funds provided by the banking segment to the other
operating segments which are accounted for at a predetermined transfer price
(including certain overhead costs).

         The Company's reportable segments are strategic business units that
offer different products and services. They are managed and reported upon
separately within the Company.

<TABLE>
<CAPTION>

                                                              At or For Three Months Ended March 31, 2002
                                                       ----------------------------------------------------------
                                                                        Insurance
                                                           Auto          Premium
                                                         Finance         Finance        Banking         Total
                                                       -------------   ------------    -----------    -----------
<S>                                                    <C>             <C>             <C>            <C>
Net interest income                                        $ 8,930          $ 544        $ 2,226        $11,700
Provision for loan losses                                       --             85             --             85
Non-interest income                                             95            128            143            366
Non-interest expense                                         5,934             51          1,894          7,879
                                                       -------------   ------------    -----------    -----------
Segment profit (loss), pre-tax                             $ 3,091          $ 536         $  475        $ 4,102
                                                       =============   ============    ===========    ===========
Total assets                                              $209,692        $40,639       $487,901       $738,232
                                                       =============   ============    ===========    ===========
<CAPTION>

                                                              At or For Three Months Ended March 31, 2001
                                                       ----------------------------------------------------------
                                                                        Insurance
                                                           Auto          Premium
                                                         Finance         Finance        Banking         Total
                                                       -------------   ------------    -----------    -----------
<S>                                                    <C>             <C>             <C>            <C>
Net interest income                                        $ 6,542          $ 716        $ 1,137        $ 8,395
Provision for loan losses                                       --             44             --             44
Non-interest income                                             80            105            445            630
Non-interest expense                                         4,121            175          2,156          6,452
                                                       -------------   ------------    -----------    -----------
Segment profit, pre-tax                                    $ 2,501          $ 602        $ (574)        $ 2,529
                                                       =============   ============    ===========    ===========
Total assets                                              $160,519        $34,183       $302,616       $497,318
                                                       =============   ============    ===========    ===========
</TABLE>


         For the reportable segment information presented, substantially all
expenses are recorded directly to each industry segment

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

         Certain statements in this Annual Report on Form 10-Q, including
statements regarding United PanAm Financial Corp.'s ("UPFC") strategies, plans,
objectives, expectations and intentions, may include forward-looking information
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. These
forward-looking statements involve certain risks and uncertainties that could
cause actual results to differ materially from those expressed or implied in
such forward-looking statements. Such risks and uncertainties include, but are
not limited to, the following factors: our limited operating history; loans we
made to credit-impaired borrowers; our need for additional sources of financing;
concentration of our business in California; estimates involving our
discontinued operations; reliance on operational systems and controls and key
employees; competitive pressure we face in the banking industry; changes in the
interest rate environment; rapid growth of our businesses; general economic
conditions; impact of inflation and changing prices; and other risks, some of
which may be identified from time to time in our filings with the Securities and
Exchange Commission (the "SEC"). See "Item 1. Business - Factors That May Affect
Future Results of Operations."

                                       8

<PAGE>

General

  The Company

     The Company is a specialty finance company engaged primarily in originating
and acquiring retail automobile installment sales contracts and insurance
premium finance contracts financed by bank deposits. The Company markets to
customers who generally cannot obtain financing from traditional lenders. These
customers usually pay higher interest rates than those charged by traditional
lenders to gain access to consumer financing. The Company funds its operations
principally through retail deposits, brokered deposits, repurchase agreements
and Federal Home Loan Bank ("FHLB") advances.

     The Company commenced operations in 1994 by purchasing from the RTC certain
assets and assuming certain liabilities of the Bank's predecessor, Pan American
Federal Savings Bank. The Company has used the Bank as a base for expansion into
its current specialty finance businesses. In 1995, the Company commenced its
insurance premium finance business through an agreement with BPN Corporation
("BPN") and in 1996, the Company commenced its automobile finance business.

  Automobile Finance

     In 1996, the Bank commenced its automobile finance business through its
subsidiary, United Auto Credit Corporation (such business, "UACC"). UACC
acquires, holds for investment and services nonprime retail automobile
installment sales contracts ("auto contracts") generated by franchised and
independent dealers of used automobiles. UACC's customers are considered
"nonprime" because they typically have limited credit histories or credit
histories that preclude them from obtaining loans through traditional sources.
As UACC provides all marketing, origination, underwriting and servicing
activities for its loans, income is generated from a combination of spread and
non-interest income and is used to cover all operating costs, including
compensation, occupancy and systems expense.

  Insurance Premium Finance

     In May 1995, the Bank entered into an agreement with BPN under the name
"ClassicPlan" (such business, "IPF"). Under this agreement, which commenced
operations in September 1995, the Bank underwrites and finances private
passenger automobile and small business insurance premiums in California and BPN
markets the financing program and services the loans for the Bank. The Bank
lends to individuals or small businesses for the purchase of single premium
insurance policies and the Bank's collateral is the unearned insurance premium
held by the insurance company. The unearned portion of the insurance premium is
refundable to IPF in the event the underlying insurance policy is canceled. The
Company does not sell or have the risk of underwriting the underlying insurance
policy.

     As a result of BPN performing substantially all marketing and servicing
activities, the Company's role is primarily that of an underwriter and funder of
loans. Therefore, IPF's income is generated primarily on a spread basis,
supplemented by non-interest income generated from late payment and returned
check fees. The Bank uses this income to cover the costs of underwriting and
loan administration, including compensation, occupancy and data processing
expenses.

The Bank

     The Company currently funds its operations through the Bank's deposits,
repurchase agreements and FHLB advances. As of March 31, 2002, the Bank was a
four-branch federal savings bank with $372.7 million in deposits. The Bank
generates spread income not only from loans originated or purchased by each of
the Company's principal businesses, but also from its securities portfolio and
consumer loans originated by its retail deposit branches. This income is
supplemented by non-interest income from its branch banking activities (e.g.,
deposit service charges, safe deposit box fees), and is used to cover operating
costs and other expenses.

                                       9

<PAGE>

Average Balance Sheets

     The following table sets forth information relating to the Company for the
three months ended March 31, 2002 and 2001. The yields and costs are derived by
dividing annualized income or expense by the average balance of assets or
liabilities for the periods shown. The yields and costs include fees, which are
considered adjustments to yields.

<TABLE>
<CAPTION>

                                                                  Three Months Ended March 31,
                                       ---------------------------------------------------------------------
                                                       2002                                2001
                                       --------------------------------     --------------------------------
                                                                Average                              Average
(Dollars in thousands)                   Average                 Yield/      Average                  Yield/
                                       Balance (1)   Interest    Cost       Balance(1)   Interest      Cost
                                       -----------   --------   -------     ----------   --------    -------
<S>                                   <C>           <C>        <C>         <C>          <C>         <C>
Assets
Interest earning assets
   Securities and short term
     investments                          $323,983    $ 2,659     3.33%       $242,219     $3,640      6.01%
   Mortgage loans, net(2)                      163          3     6.47%         13,175        378     11.47%
   IPF loans, net(3)                        39,316      1,332    13.74%         33,998      1,322     15.56%
   Automobile installment
     contracts, net(4)                     205,445     11,702    23.10%        151,984      8,590     22.61%
                                       -----------   --------               ----------   --------
       Total interest earning
         assets                            568,907    $15,696    11.19%        441,376    $13,930     12.62%
                                                     --------                            --------
Non-interest earnings assets                34,678                              23,694
                                       -----------                          ----------
       Total assets                       $603,585                            $465,070
                                       ===========                          ==========
Liabilities and Equity
Interest bearing liabilities
   Customer deposits                      $365,727    $ 3,232     3.58%       $350,201     $5,020      5.81%
   Repurchase agreements                    39,652        193     1.97%             --         --         --
   FHLB advances                           108,701        571     2.13%         33,035        515      6.32%
                                       -----------   --------               ----------   --------
       Total interest bearing
         liabilities                       514,080    $ 3,996     3.15%        383,236     $5,535      5.86%
                                                     --------                            --------
Non-interest bearing liabilities            12,647                              11,735
                                       -----------                          ----------
       Total liabilities                   526,727                             394,971
Equity                                      76,858                              70,099
                                       -----------                          ----------
       Total liabilities and equity       $603,585                            $465,070
                                       ===========                          ==========
Net interest income before
  provision for loan losses                           $11,700                              $8,395
                                                     ========                            ========
Net interest rate spread(5)                                       8.03%                                6.76%
Net interest margin(6)                                            8.34%                                7.71%
Ratio of interest  earning assets to
   interest bearing liabilities                                    111%                                 115%
</TABLE>

------------------------
(1) Average balances computed on a monthly basis.
(2) Net of allowance for loan losses; includes non-performing loans.
(3) Net of allowance for losses; includes non-performing loans.
(4) Net of unearned finance charges and allowance for losses; includes
    non-performing loans.
(5) Net interest rate spread represents the difference between the yield on
    interest earning assets and the cost of interest bearing liabilities.
(6) Net interest margin represents net interest income divided by average
    interest earning assets.

Comparison of Operating Results for the Three Months Ended March 31, 2002 and
March 31, 2001

  General

     Net income increased $1.13 million from $1.54 million for the three months
ended March 31, 2001 to $2.67 million for the three months ended March 31, 2002.

     The increase in net income was due primarily to a $3.3 million increase in
net interest income from $8.4 million in the first quarter of 2001 to $11.7
million during the same quarter of 2002 partially offset by a $1.4 million
increase in non-interest expense. Net interest income was favorably impacted by
the continued expansion and growth of the Company's automobile finance business.

     Auto contracts purchased, including unearned finance charges, increased
$14.2 million from $57.7 million for the three months ended March 31, 2001 to
$71.9 million for the three months ended March 31, 2002, as a result of our
planned growth in the auto finance business, while insurance premium finance
originations increased $3.9 million from $24.3 million for the three months
ended March 31, 2001 to $28.2 million for the three months ended March 31, 2002.

                                       10

<PAGE>

  Interest Income

     Interest income increased from $13.9 million for the three months ended
March 31, 2001 to $15.7 million for the three months ended March 31, 2002 due
primarily to a $127.5 million increase in average interest earning assets
partially offset by a 1.43% decrease in the weighted average interest rate on
interest earning assets. The largest components of growth in average interest
earning assets were securities, which increased $101.8 million and automobile
installment contracts, which increased $53.5 million. The increase in securities
was a result of an increase in commercial borrowings, reflecting the need to
increase assets to meet the 30% qualified thrift lender requirement of the
Office of Thrift Supervision ("OTS"). The increase in auto contracts principally
resulted from the purchasing of additional dealer contracts in existing and new
markets consistent with the planned growth of this business unit.

     The decline in the average yield on interest earning assets was due to a
general decline in market interest rates and an increased concentration of lower
yielding securities in the three months ended March 31, 2002 compared to the
three months ended March 31, 2001. Average short term investments and investment
securities, with an average yield of 3.33%, comprised 60.5% of average interest
earning assets in the three months ended March 31, 2002 compared with 54.9% of
average interest earning assets in the three months ended March 31, 2001.

  Interest Expense

     Interest expense decreased from $5.5 million for the three months ended
March 31, 2001 to $4.0 million for the three months ended March 31, 2002 due to
a general decline in market interest rates, partially offset by a $130.8 million
increase in average interest bearing liabilities. The largest component of
average interest bearing liabilities was deposits of the Bank, which increased
from an average balance of $350.2 million during the quarter ended March 31,
2001 to $365.7 million during the quarter ended March 31, 2002 and FHLB advances
which increased from $33.0 million for the quarter ended March 31, 2001 to
$108.7 million during the quarter ended March 31, 2002. The average cost of
liabilities decreased from 5.86% for the three months ended March 31, 2001 to
3.15% for the comparable period in 2002 generally as a result of a decrease in
market interest rates.

  Provision for Loan Losses

     Provision for loan losses was $85,000 for the three months ended March 31,
2002 compared to $44,000 for the three months ending March 31, 2001. The
provision for loan losses reflects estimated losses associated with the
Company's insurance premium finance business. The total allowance for loan
losses was $18.6 million at March 31, 2002 compared with $16.4 million at March
31, 2001, representing 7.26% of loans held for investment at March 31, 2002 and
7.38% at March 31, 2001. Annualized net charge-offs to average loans were 6.63%
for the three months ended March 31, 2002 compared with 4.11% for the three
months ended March 31, 2001 and 6.77% for the three months ended December 31,
2001.

     In addition to its provision for losses, the Company's allowance for loan
losses is also increased by its allocation of acquisition discounts related to
the purchase of automobile installment contracts. The Company allocates the
estimated amount of its acquisition discounts attributable to credit risk to the
allowance for loan losses. At March 31, 2002, the Company was allocating 10.5%
of the net loan amount of all new loans to allowance for loan losses.

     A provision for loan losses is charged to operations based on the Company's
regular evaluation of its loans and the adequacy of its allowance for loan
losses. While management believes it has adequately provided for losses and does
not expect any material loss on its loans in excess of allowances already
recorded, no assurance can be given that economic or real estate market
conditions or other circumstances will not result in increased losses in the
loan portfolio.

                                       11

<PAGE>

  Non-interest Income

     Non-interest income decreased $264,000, from $630,000 for the three months
ended March 31, 2001 to $366,000 for the three months ended March 31, 2002 as a
result of a $357,000 gain on the sale of loans in 2001 which was not repeated in
2002, partially offset by a $61,000 gain on the sale of securities and an
increase in service charges and fee income.

  Non-interest Expense

     Non-interest expense increased $1.4 million from $6.5 million for the three
months ended March 31, 2001 to $7.9 million for the three months ended March 31,
2002. The increase in non-interest expense was driven primarily by an increase
in salaries, employee benefit costs and occupancy expenses associated with the
planned growth of the auto finance business. During the last 12 months, the
Company expanded its automobile finance operations, resulting in an increase
from 213 employees in 31 offices, as of March 31, 2001, to 294 employees in 42
offices, as of March 31, 2002.

Income Taxes

     Income taxes increased $619,000 from $985,000 for the three months ended
March 31, 2001 to $1,604,000 for the three months ended March 31, 2002. This
increase occurred as a result of a $1.7 million increase in income before income
taxes between the two periods.

Comparison of Financial Condition at March 31, 2002 and December 31, 2001

     Total assets increased $48.7 million, from $689.6 million at December 31,
2001 to $738.3 million at March 31, 2002. The increase resulted primarily from a
$29.5 million increase in cash and cash equivalents and investment securities
from $425.5 million at December 31, 2001 to $455.0 million at March 31, 2002 and
a $19.1 million increase in auto loans from $236.4 at December 31, 2001 to 255.5
at March 31, 2002.

     Deposits increased $15.3 million from $357.4 million at December 31, 2001
to $372.7 million at March 31, 2002. Retail deposits decreased $5.2 million from
$278.0 million at December 31, 2201 to $272.8 million at March 31, 2002.
Wholesale deposits increased $20.6 million from $79.4 million at December 31,
2001 to $100.0 million at March 31, 2002.

     Shareholders' equity increased from $75.7 million at December 31, 2001 to
$77.8 million at March 31, 2002, primarily as a result of net income of $2.7
million during the three months ended March 31, 2002, partially offset by a
$563,000 decrease in unrealized gains on securities.

Management of Interest Rate Risk

     The principal objective of the Company's interest rate risk management
program is to evaluate the interest rate risk inherent in the Company's business
activities, determine the level of appropriate risk given the Company's
operating environment, capital and liquidity requirements and performance
objectives and manage the risk consistent with guidelines approved by the Board
of Directors. Through such management, the Company seeks to reduce the exposure
of its operations to changes in interest rates. The Board of Directors reviews
on a quarterly basis the asset/liability position of the Company, including
simulation of the effect on capital of various interest rate scenarios.

     The Company's profits depend, in part, on the difference, or "spread,"
between the effective rate of interest received on the loans it originates and
the interest rates paid on deposits and other financing facilities, which can be
adversely affected by movements in interest rates.

     The Bank's interest rate sensitivity is monitored by the Board of Directors
and management through the use of a model, which estimates the change in the
Bank's net portfolio value ("NPV") over a range of interest rate scenarios. NPV
is the present value of expected cash flows from assets, liabilities and
off-balance sheet instruments, and "NPV Ratio" is defined as the NPV in that
scenario divided by the market value of assets in the

                                       12

<PAGE>

same scenario. The Company reviews a market value model (the "OTS NPV model")
prepared quarterly by the OTS, based on the Bank's quarterly Thrift Financial
Reports filed with the OTS. The OTS NPV model measures the Bank's interest rate
risk by approximating the Bank's NPV under various scenarios which range from a
300 basis point increase to a 300 basis point decrease in market interest rates.
The OTS has incorporated an interest rate risk component into its regulatory
capital rule for thrifts. Under the rule, an institution whose sensitivity
measure, as defined by the OTS, in the event of a 200 basis point increase or
decrease in interest rates exceeds 20% would be required to deduct an interest
rate risk component in calculating its total capital for purposes of the
risk-based capital requirement.

     At December 31, 2001, the most recent date for which the relevant OTS NPV
model is available, the Bank's sensitivity measure resulting from a 100 basis
point decrease in interest rates was 25 basis points and would result in a $2.5
million increase in the NPV of the Bank and a 200 basis point increase in
interest rates was 126 basis points and would result in a $11.1 million decrease
in the NPV of the Bank. At December 31, 2001, the Bank's sensitivity measure was
below the threshold at which the Bank could be required to hold additional
risk-based capital under OTS regulations.

     Although the NPV measurement provides an indication of the Bank's interest
rate risk exposure at a particular point in time, such measurement is not
intended to and does not provide a precise forecast of the effect of changes in
market interest rates on the Bank's net interest income and will differ from
actual results. Management monitors the results of this modeling, which are
presented to the Board of Directors on a quarterly basis.

     The following table shows the NPV and projected change in the NPV of the
Bank at December 31, 2001 assuming an instantaneous and sustained change in
market interest rates of 100, 200 and 300 basis points ("bp"). This table is
prepared by the OTS. The table does not include data for -200 and -300 basis
points because these changes in rates would infer negative interest rates and
are therefore not relevant.

                Interest Rate Sensitivity of Net Portfolio Value
<TABLE>
<CAPTION>


                                                                                NPV as % of Portfolio
                                              Net Portfolio Value                  Value of Assets
                                     ------------------------------------     --------------------------
         Change in Rates             $ Amount    $ Change      % Change       NPV Ratio         % Change
         ---------------             --------    --------     -----------     ---------         --------
                                                          (Dollars in thousands)
<S>                                  <C>         <C>                   <C>        <C>             <C>
+300 bp                              $ 75,034    $(19,212)            -20%        10.59%         -223 bp
+200 bp                                83,139     (11,107)            -12%        11.57%         -126 bp
+100 bp                                89,713      (4,533)             -5%        12.33%          -50 bp
0 bp                                   94,246          --              --%        12.83%            --bp
-100 bp                                96,738       2,492               3%        13.08%          +25 bp
-200 bp                                    --          --              --%           --%            --bp
-300 bp                                    --          --              --%           --%            --bp
</TABLE>

Liquidity and Capital Resources

  General

     The Company's primary sources of funds are deposits at the Bank, FHLB
advances, commercial repurchase agreements and, to a lesser extent, interest
payments on short-term investments and proceeds from the maturation and sale of
securities. While maturities and scheduled amortization of loans are a
predictable source of funds, deposit flows and loan prepayments are greatly
influenced by general interest rates, economic conditions and competition.
However, the Company has continued to maintain adequate levels of liquid assets
to fund its operations. Management, through its Asset and Liability Committee,
monitors rates and terms of competing sources of funds to use the most
cost-effective source of funds wherever possible.

     The major source of funds is deposits obtained through the Bank's four
retail branches in California. The Bank offers checking accounts, various money
market accounts, regular passbook accounts, fixed interest rate certificates
with varying maturities and retirement accounts. Deposit account terms vary by
interest rate, minimum balance requirements and the duration of the account.
Interest rates paid, maturity terms, service fees and withdrawal penalties are
established by the Bank periodically based on liquidity and financing
requirements, rates paid by competitors, growth goals and federal regulations.
At March 31, 2002, such retail deposits were $272.8 million or 73.2% of total
deposits.

                                       13

<PAGE>

     The Bank uses wholesale and broker-originated deposits to supplement its
retail deposits and, at March 31, 2002, these deposits totaled $99.9 million or
26.8% of total deposits. The Bank solicits wholesale deposits by posting its
interest rates on a national on-line service, which advertises the Bank's
wholesale products to investors. Generally, most of the wholesale deposit
account holders are institutional investors, commercial businesses or public
sector entities. Broker deposits are originated through major dealers
specializing in such products. Brokered deposits at March 31, 2002 totaled $51.5
million.

     The following table sets forth the balances and rates paid on each category
of deposits for the dates indicated.

<TABLE>
<CAPTION>


                                                                         Years Ended
                                   Three Months Ended                    December 31,
                                        March 31,        ------------------------------------------
                                          2002                    2001                  2000
                                  --------------------   --------------------   -------------------
                                              Weighted               Weighted              Weighted
                                               Average               Average                Average
                                   Balance      Rate     Balance       Rate     Balance      Rate
                                  --------    --------   --------    --------   -------    --------
                                                        (Dollars in thousands)
<S>                              <C>           <C>      <C>            <C>     <C>          <C>
  Passbook accounts               $ 54,007      2.35%    $ 47,931       2.31%   $ 38,730     4.32%
  Checking accounts                 17,950      1.02%      13,795       1.06%     15,250     2.25%
  Certificates of deposit
     Under $100,000                214,477      3.87%     212,981       4.43%    211,427     6.40%
     $100,000 and over              86,298      3.51%      82,643       4.33%     82,823     6.57%
                                  --------               --------               --------
       Total                      $372,732      3.43%    $357,350       3.99%   $348,230     6.03%
</TABLE>


     The following table sets forth the time remaining until maturity for all
CDs for the dates indicated.

                                  March 31,      December 31,     December 31,
                                    2002            2001             2000
                                  --------       -----------      -----------
                                            (Dollars in thousands)
Maturity within one year          $207,707          $237,683         $257,710
Maturity within two years           63,780            46,170           36,440
Maturity within three years         18,973             7,657              100
Maturity over three years           10,315             4,117               --
                                  --------       -----------      -----------
Total certificates of deposit     $300,775          $295,624         $294,250
                                  ========       ===========      ===========

     Although the Bank has a significant amount of deposits maturing in less
than one year, the Company believes that the Bank's current pricing strategy
will enable it to retain a significant portion of these accounts at maturity and
that it will continue to have access to sufficient amounts of CDs which,
together with other funding sources, will provide the necessary level of
liquidity to finance its lending businesses. However, as a result of these
shorter-term deposits, the rates on these accounts may be more sensitive to
movements in market interest rates, which may result in a higher cost of funds.

     At March 31, 2002, the Bank exceeded all of its regulatory capital
requirements with tangible capital of $68.6 million, or 9.29% of total adjusted
assets, which is above the required level of $11.1 million, or 1.5%; core
capital of $68.6 million, or 9.29% of total adjusted assets, which is above the
required level of $22.2 million, or 3.0%; and risk-based capital of $73.2
million, or 20.34% of risk-weighted assets, which is above the required level of
$28.8 million, or 8.0%.

     As used herein, leverage or core ratio means the ratio of core capital to
adjusted total assets, Tier 1 risk-based capital ratio means the ratio of core
capital to risk-weighted assets, and total risk-based capital ratio means the
ratio of total capital to risk-weighted assets, in each case as calculated in
accordance with current OTS capital regulations. Under the Federal Deposit
Insurance Corporation Act of 1991 ("FDICIA"), the Bank is deemed to be "well
capitalized" at March 31, 2002.

                                       14

<PAGE>

         The Company has other sources of liquidity, including FHLB advances,
repurchase agreements and its liquidity and investments portfolio. Through the
Bank, the Company can obtain advances from the FHLB, collateralized by its
securities. The FHLB functions as a central reserve bank providing credit for
thrifts and certain other member financial institutions. Advances are made
pursuant to several programs, each of which has it's own interest rate and range
of maturities. Limitations on the amount of advances are based generally on a
fixed percentage of total assets or on the FHLB's assessment of an institution's
credit-worthiness. As of March 31, 2002, the Bank's total borrowing capacity
under this credit facility was $147.6 million, of which $43.6 million was
available.

         The following table sets forth certain information regarding the
Company's short-term borrowed funds (consisting of FHLB advances, repurchase
agreements and warehouse lines of credit) at or for the periods ended on the
dates indicated.

<TABLE>
<CAPTION>
                                                                                                  December 31,
                                                                      March 31,     -----------------------------------
                                                                       2002               2001                2000
                                                                  --------------    ----------------    ---------------
                                                                                   (Dollars in thousands)
<S>                                                               <C>               <C>                 <C>
FHLB advances
  Maximum month-end balance                                          $130,000           $ 130,000           $ 60,000
  Balance at end of period                                            104,000             130,000             60,000
  Average balance for period                                          108,701              38,830             22,877
  Weighted average interest rate on balance at end of period             2.03%               1.97%              6.81%
  Weighted average interest rate on average balance for period           2.13%               4.04%              6.58%
Repurchase Agreements
  Maximum month-end balance                                           171,466             114,776                 --
  Balance at end of period                                            171,466             114,776                 --
  Average balance for period                                           39,652               4,503                 --
  Weighted average interest rate on balance at end of period             1.86%              2.37%                 --%
  Weighted average interest rate on average balance for period           1.97%              3.46%                 --%
Warehouse lines of credit
  Maximum month-end balance                                                --                  --           $ 26,623
  Balance at end of period                                                 --                  --                 --
  Average balance for period                                               --                  --              1,796
  Weighted average interest rate on balance at end of period               --%                 --%                --%
  Weighted average interest rate on average balance for period             --%                 --%              6.27%
</TABLE>

         The Company had no material contractual obligations or commitments for
capital expenditures at March 31, 2002.

                                       15

<PAGE>

         Summary of Loan Portfolio. At March 31, 2002, the Company's loan
portfolio constituted $255.6 million, or 34.6% of the Company's total assets.

         The following table sets forth the composition of the Company's loan
portfolio at the dates indicated.

<TABLE>
<CAPTION>
                                                               March 31,            December 31,          December 31,
                                                                 2002                   2001                  2000
                                                           ------------------    -------------------    ------------------
<S>                                                        <C>                   <C>                    <C>
Consumer Loans
Automobile installment contracts                                   $250,560               $232,902              $176,255
Insurance premium finance                                            29,862                 28,710                25,843
Other consumer loans                                                     64                     98                   577
                                                           ------------------    -------------------    ------------------
      Total consumer loans                                          280,486                261,710               202,675
                                                           ------------------    -------------------    ------------------

Mortgage Loans
Mortgage loans (purchased primarily from RTC)                            --                     --                16,784
Subprime mortgage loans                                                 278                    352                 1,845
                                                           ------------------    -------------------    ------------------
      Total mortgage loans                                              278                    352                18,629
                                                           ------------------    -------------------    ------------------

Commercial Loans
Insurance premium finance                                            10,777                 10,921                 8,342
Other commercial loans                                                   --                     --                    55
                                                           ------------------    -------------------    ------------------
      Total commercial loans                                         10,777                 10,921                 8,397
                                                           ------------------    -------------------    ------------------

      Total loans                                                   291,541                272,983               229,701
Unearned discounts and premium                                           --                     --                  (728)
Unearned finance charges                                            (17,364)               (18,881)              (20,737)
Allowance for loan losses                                           (18,555)               (17,460)              (15,156)
                                                           ------------------    -------------------    ------------------
      Total loans, net                                             $255,622               $236,642              $193,080
                                                           ==================    ===================    ==================
</TABLE>

         Loan Maturities. The following table sets forth the dollar amount of
loans maturing in the Company's loan portfolio at March 31, 2002 based on
scheduled contractual amortization. Loan balances are reflected before unearned
discounts and premiums, unearned finance charges and allowance for loan losses.

<TABLE>
<CAPTION>

                                                                March 31, 2002
                       --------------------------------------------------------------------------------------------------
                                       More Than 1   More Than 3    More Than 5     More Than
                        One Year or      Year to       Years to       Years to      10 Years      More Than       Total
                           Less          3 Years       5 Years        10 Years     to 20 Years     20 Years       Loans
                       -------------  ------------- -------------  -------------  ------------  -------------  ----------
                                                            (Dollars in thousands)
<S>                     <C>           <C>           <C>                <C>          <C>              <C>    <C>
Consumer Loans              $37,170       $101,550      $141,462           $304         $  --            $ -    $280,486
Mortgage loans                   --             --            --             --           278             --         278
Commercial loans             10,777             --            --             --            --             --      10,777
                       -------------  ------------- -------------  -------------  ------------  -------------  ----------
      Total                 $47,947       $101,550      $141,462           $304          $278            $ -    $291,541
                       =============  ============= =============  =============  ============  =============  ==========
</TABLE>


      Classified Assets and Allowance for Loan Losses

         The Company's policy is to maintain an allowance for loan losses to
absorb inherent losses, which may be realized on its loan portfolio. These
allowances include specific allowances for identifiable impairments of
individual loans and general valuation allowances for estimates for probable
losses not specifically identified. In addition, the Company's allowance for
loan losses is increased by a percentage of each new auto loan, currently 10.5%
of the net contract amount. For IPF loans, management established a level of
allowance for loan losses based on recent trends in delinquencies and historical
charge offs, currently 1.25% of loans, that it feels adequate for the risk in
the portfolio. Each month an amount necessary to reach that level is charged
against current earnings and added to allowance for loan losses.

         Periodically, management reviews the level of allowance for loan losses
to determine adequacy. The determination of the adequacy of the allowance for
loan losses is based on a variety of factors including an assessment of the
credit risk inherent in the portfolio, prior loss experience, the levels and
trends of non-performing loans, current and prospective economic conditions and
other factors.

                                       16

<PAGE>

         The Company's management uses its best judgment in providing for
possible loan losses and establishing allowances for loan losses. However, the
allowance is an estimate, which is inherently uncertain and depends on the
outcome of future events. In addition, regulatory agencies, as an integral part
of their examination process, periodically review the Bank's allowance for loan
losses. Such agencies may require the Bank to increase the allowance based upon
their judgment of the information available to them at the time of their
examination. The Bank's most recent examination by its regulatory agencies was
completed in April 2001 and no adjustment to the Bank's allowance for loan
losses was required.

         The following table sets forth the remaining balances of all loans
(before specific allowances for losses) that were more than 30 days delinquent
at March 31, 2002, December 31, 2001 and 2000.

<TABLE>
<CAPTION>

Loan
-----                  March 31,     % of Total       December 31,       % of Total      December 31,      % of Total
Delinquencies           2002            Loans             2001              Loans            2000            Loans
-------------     ---------------- --------------- ------------------ ---------------- ---------------- ---------------
                                                                (Dollars in thousands)
<S>               <C>              <C>             <C>                <C>              <C>              <C>
30 to 59 days             $1,320            0.5%            $ 1,368             0.6%            $ 953            0.5%
60 to 89 days                519            0.2%                776             0.3%              494            0.3%
90+ days                     905            0.4%                942             0.4%            2,374            1.2%
                  ---------------- --------------- ------------------ ---------------- ---------------- ---------------
Total                     $2,744            1.1%            $ 3,086             1.3%          $ 3,821            2.0%
                  ================ =============== ================== ================ ================ ===============
</TABLE>

         Nonaccrual and Past Due Loans. A non-mortgage loan is placed on
nonaccrual status when it is delinquent for 120 days or more. When a loan is
reclassified from accrual to nonaccrual status, all previously accrued interest
is reversed. Interest income on nonaccrual loans is subsequently recognized only
to the extent that cash payments are received or the borrower's ability to make
periodic interest and principal payments is in accordance with the loan terms,
at which time the loan is returned to accrual status. Accounts, which are deemed
fully or partially uncollectible by management, are generally fully reserved or
charged off for the amount that exceeds the estimated fair value (net of selling
costs) of the underlying collateral.

     The following table sets forth the aggregate amount of nonaccrual loans
(net of unearned discounts, premiums and unearned finance charges.) at March 31,
2002, December 31, 2001 and 2000.

<TABLE>
<CAPTION>
                                                                                                   December 31,
                                                                     March 31,      -------------------------------------
                                                                       2002               2001                2000
                                                                 -----------------  ------------------  -----------------
                                                                                 (Dollars in thousands)
Nonaccrual loans
<S>                                                              <C>                <C>                 <C>
  Single-family residential                                              $ 278             $   352            $ 2,281
  Consumer and other loans                                                 599                 688              1,323
                                                                 -----------------  ------------------ ------------------
     Total                                                               $ 877             $ 1,040            $ 3,604
                                                                 =================  ==================  =================

Nonaccrual loans as a percentage of
  Total loans held for investment                                         0.34%               0.44%              1.87%
  Total assets                                                            0.12%               0.15%              0.74%

Allowance for loan losses as a percentage of
  Total loans held for investment                                         7.26%               7.38%              7.88%
  Nonaccrual loans                                                     2115.74%            1678.84%            420.53%
</TABLE>

                                       17

<PAGE>

     Allowance for Loan Losses. The following is a summary of the changes in the
consolidated allowance for loan losses of the Company for the periods indicated.

<TABLE>
<CAPTION>

                                                                                          At or For the
                                                            At or For the                  Year Ended
                                                            Three Months                  December 31,
                                                           Ended March 31,    -------------------------------------
                                                                2002                2001               2000
                                                          ------------------  -----------------  ------------------
                                                                           (Dollars in thousands)
<S>                                                       <C>                 <C>                <C>
Allowance for Loan Losses

Balance at beginning of period                                  $ 17,460           $ 15,156            $ 14,139
     Provision for loan losses - continuing operations                85                615                 201
     Provision for loan losses - discontinued operations              --                 --               2,396
     Charge-offs
          Mortgage loans                                             (10)            (1,713)             (6,402)
          Consumer loans                                          (4,390)            (9,173)             (6,025)
                                                          ------------------  -----------------  ------------------
                                                                  (4,400)           (10,886)            (12,427)
     Recoveries
          Mortgage loans                                              --                140                 327
          Consumer loans                                             233                266                 286
                                                          ------------------  -----------------  ------------------
                                                                     233                406                 613
                                                          ------------------  -----------------  ------------------
     Net charge-offs                                              (4,167)           (10,480)            (11,814)
     Acquisition discounts allocated to loss allowance             5,177             12,169              10,234
                                                          ------------------  -----------------  ------------------
Balance at end of period                                        $ 18,555           $ 17,460            $ 15,156
                                                          ==================  =================  ==================
     Annualized net charge-offs to average loans                    6.63%              4.94%               5.03%
     Ending allowance to period end loans, net                      7.26%              7.38%               7.88%
</TABLE>

Cash Equivalents and Securities Portfolio

         The Company's short term investments and securities portfolios are used
primarily for liquidity purposes and secondarily for investment income. Cash
equivalents and securities satisfy regulatory requirements for liquidity.

     The following is a summary of the Company's cash equivalents and securities
portfolios as of the dates indicated.

<TABLE>
<CAPTION>

                                                                                                 December 31,
                                                                March 31,         ------------------     -------------------
                                                                 2002                   2001                    2000
                                                           ------------------     ------------------     -------------------
                                                                                (Dollars in thousands)
<S>                                                        <C>                    <C>                    <C>
Balance at end of period
     Short term investments                                         $ 44,655              $ 135,267                $ 36,477
     U.S. agency securities                                          310,847                229,660                 166,838
     U.S. agency mortgage backed securities                           71,051                 35,016                  46,376
     Mutual funds                                                     20,162                 20,162                  10,051
                                                           ------------------     ------------------     -------------------
     Total                                                         $ 446,715              $ 420,104               $ 259,742
                                                           ==================     ==================     ===================
Weighted average yield at end of period
     Overnight deposits                                                0.91%                  1.23%                   5.69%
     U.S. agency securities                                            2.75%                  3.35%                   6.27%
     U.S. agency mortgage backed securities                            4.06%                  6.60%                   7.35%
     Mutual funds (mortgage-backed securities)                         3.23%                  3.59%                   6.59%
Weighted average maturity at end of period
     Overnight deposits                                                1 day                  1 day                   1 day
     U.S. agency securities                                        81 months              85 months                5 months
     U.S. agency mortgage-backed securities                       308 months             254 months              267 months
     Mutual funds (mortgage backed securities)                         1 day                  1 day                   1 day
</TABLE>

Item 3.           Quantitative and Qualitative Disclosures About Market Risk.
                  -----------------------------------------------------------

     See "Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations - Management of Interest Rate Risk.

                                       18




<PAGE>

PART II.                            OTHER INFORMATION

Item 1.           Legal Proceedings.
                  -----------------

         Not applicable

Item 2.           Changes in Securities and Use of Proceeds.
                  -----------------------------------------

         Not applicable

Item 3.           Defaults Upon Senior Securities.
                  -------------------------------

         Not applicable

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

         Not applicable

Item 5.           Other Information.
                  -----------------

         Not applicable

Item 6.           Exhibits and Reports on Form 8-K.
                  --------------------------------
         (a)      List of Exhibits
                  10.110 Employment agreement dated March 15, 2002 between
                  Pan American Bank, FSB and Guillermo Bron.

         (b)      Reports on Form 8-K

                  Not applicable

                                       19

<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.

                                      United PanAm Financial Corp.


Date:      May 9, 2002                By:    /s/    Guillermo Bron
                                             -----------------------------------

                                      Guillermo Bron
                                      Chairman
                                      and Chief Executive Officer
                                      (Principal Executive Officer)

           May 9, 2002                By:    /s/    Garland W. Koch
                                             -----------------------------------

                                      Garland W. Koch
                                      Senior Vice President
                                      and Chief Financial Officer
                                      (Principal Financial and Accounting
                                      Officer)