SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-K

(Mark One)
    |X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
        EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1999
                                       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 1-3521

                      WASHINGTON MUTUAL FINANCE CORPORATION
             (Exact name of registrant as specified in its charter)

                  DELAWARE                               95-4128205
       (State or other jurisdiction of                (I.R.S. Employer
       incorporation or organization)              Identification Number)
      8900 Grand Oak Circle, Tampa, FL                   33637-1050
  (Address of principal executive offices)               (Zip Code)

                                 (813) 632-4500
         (Registrant's telephone number, including area code)

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

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

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed  by  Section  13 or 15 (d) of the  Securities  Exchange  Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.

                    Yes    X                          No
                       ----------                       ------------

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

                                 Not applicable

The aggregate  market value of Common Stock held by  non-affiliates:  None
As of February 28, 2000, there were 1,000 shares of Common Stock outstanding.

Documents incorporated by reference:                  None

Registrant meets the conditions set forth in General  Instruction  (I)(1)(a) and
(b) of Form 10-K and is therefore  filing this Form with the reduced  disclosure
format.


<PAGE> 2





                      WASHINGTON MUTUAL FINANCE CORPORATION

                           ANNUAL REPORT ON FORM 10-K

                                Table of Contents

                                                                           Page

                                     PART I

Item 1.     Business .........................................................3
Item 2.     Properties ......................................................11
Item 3.     Legal Proceedings................................................11
Item 4.     Submission of Matters to a Vote of Security Holders...............*

                                     PART II

Item 5.     Market for the Registrant's Common Equity
               and Related Stockholder Matters...............................12
Item 6.     Selected Financial Data..........................................12
Item 7.     Management's Discussion and Analysis of Financial Condition
               and Results of Operations.....................................13
Item 7A.    Quantitative and Qualitative Disclosures About Market Risk.......22
Item 8.     Financial Statements and Supplementary Data......................24
Item 9.     Changes in and Disagreements with Accountants on
               Accounting and Financial Disclosure...........................44

                                    PART III

Item 10.    Directors and Executive Officers of the Registrant................*
Item 11.    Executive Compensation............................................*
Item 12.    Security Ownership of Certain Beneficial Owners and
               Management.....................................................*
Item 13.    Certain Relationships and Related Transactions....................*

                                    PART IV

Item 14.    Exhibits, Financial Statement Schedules and
               Reports on Form 8-K...........................................45


       *    Items 4, 10, 11, 12 and 13 are not included as per conditions
            met by Registrant set forth in General Instruction I(1)(a) and
            (b) of Form 10-K.


<PAGE> 3


This document  contains  forward-looking  statements,  which are not  historical
facts  and  pertain  to our  future  operating  results.  These  forward-looking
statements are within the meaning of the Private  Securities  Litigation  Reform
Act of 1995. These  forward-looking  statements include, but are not limited to,
statements  about our plan,  objectives,  expectations  and intentions and other
statements  contained in this report that are not historical facts. When used in
this report, the words "expects,"  "anticipate," "intends," "plans," "believes,"
"seeks," "estimates," and similar expressions are generally intended to identify
forward-looking  statements.  These  forward-looking  statements  are inherently
subject to significant  business,  economic and  competitive  uncertainties  and
contingencies,  many of  which  are  beyond  our  control.  In  addition,  these
forward-looking  statements  are subject to  assumptions  with respect to future
business strategies and decisions that are subject to change. Actual results may
differ materially from the results discussed in these forward-looking statements
for the  reasons,  among  others,  discussed  under the  heading  "Business-Risk
Factors" included in this Form 10-K.

                                     PART I

Item 1.      Business

General

Washington Mutual Finance Corporation (the "Company"),  incorporated in Delaware
in 1986 as a successor to a company  incorporated  in 1927, is a holding company
headquartered in Tampa,  Florida whose  subsidiaries are engaged in the consumer
financial  services  business.  All of the Company's equity securities are owned
indirectly by Washington Mutual, Inc. ("Washington Mutual").  Effective March 1,
2000, the Company changed its name from Aristar, Inc.

The Company's  operations consist  principally of a network of approximately 540
branch offices located in 25 states,  primarily in the Southeast,  Southwest and
California.  These offices  generally  operate under the names Blazer  Financial
Services, City Finance Company and First Community Financial Services. Beginning
in November 1999 and  continuing  throughout  the first half of 2000, the office
names are being  changed to Washington  Mutual  Finance.  The  Company's  branch
offices are generally  located in small to medium-sized  communities in suburban
or rural areas and are managed by individuals  who generally  have  considerable
consumer lending experience. The primary market for the Company's consumer loans
consists of households with an annual income of up to $70,000.

The Company makes consumer loans,  secured and unsecured,  and purchases  retail
sales contracts from retail  establishments.  These consumer credit transactions
are  primarily  for  household  purposes.  The Company  also  provides  consumer
financial  services through its industrial banking  subsidiary,  First Community
Industrial  Bank ("FCIB"),  which has branches in Colorado and Utah. In addition
to making consumer loans and purchasing retail sales contracts,  FCIB also takes
customers' savings deposits insured by the Federal Deposit Insurance Corporation
("FDIC").


<PAGE> 4

The Company is managed along two major lines of business:  consumer  finance and
consumer banking. The financial  performance of these business lines is measured
by the Company's profitability reporting processes.

Portfolio Composition

The  following  table  provides an analysis  by type of the  Company's  consumer
finance receivables  (excluding unearned finance charges and deferred loan fees)
at the dates shown:

<TABLE>


(Dollars in thousands)                                                         December 31,
                                                      -------------------------------------------------------------
                                                                 1999                   1998                   1997
                                                      ---------------         --------------         --------------
Notes and contracts receivable:
<S>                                                   <C>                     <C>                    <C>
   Amount                                             $     3,061,757         $    2,574,396         $    2,328,715
   Number of accounts                                       1,001,302                966,048              1,029,532
Type:
   Real estate secured loans                          $     1,432,841         $    1,122,872         $      977,929
   Personal loans                                           1,334,350              1,159,852              1,025,235
   Retail sales contracts                                     294,566                291,672                325,551
Type as a percent of total receivables:

   Real estate secured loans                                     46.8%                  43.6%                  42.0%
   Personal loans                                                43.6                   45.1                   44.0
   Retail sales contracts                                         9.6                   11.3                   14.0
                                                      ---------------         --------------         --------------
                                                                100.0%                 100.0%                 100.0%
                                                      ===============         ==============         ==============

</TABLE>



Consumer  loans  are  typically   fixed-rate  and  are  originated  by  customer
application and periodic purchases of receivable  portfolios.  Loan originations
are a  result  of  business  development  efforts  consisting  of  direct  mail,
telemarketing and branch office sales personnel.

Consumer  loans written in 1999 had original  terms ranging from 3 to 360 months
and  averaged 71 months.  As of December 31, 1999,  53% of the  Company's  total
portfolio  was either  unsecured  or secured by  automobiles  or other  personal
property ("personal loans") and 47% of the Company's total portfolio was secured
by  real  estate.  In  1998,  these  loan  types  comprised  56%  and 44% of the
portfolio.

For the year ended  December 31, 1999,  real estate  secured  loans  outstanding
(excluding  unearned  finance  charges and deferred  loan fees)  increased  $310
million,  or 28%, as  compared to $145  million,  or 15%,  the prior year.  Real
estate  loans  are  typically  secured  by first  or  second  mortgages  and are
primarily used by the customer for purchases,  refinances or debt consolidation.
The Company has focused on growing the real estate  portfolio  due to the better
quality  inherent in the customer  base.  This better than average  quality is a
result of the fact that the primary  source of these loans is existing  personal
and sales  contract  customers  that have  maintained  a high  level of  payment
performance  over an  extended  period  of time.  In  addition,  the  underlying
security in real estate  secured  loans reduces the risk of loss to the Company.
Also,  the larger  average  balance makes this loan type more cost  effective to
originate and service.  As of December 31, 1999 and 1998, the average balance of
a real estate secured loan was approximately $27,700 and $26,600.

<PAGE> 5


During 1999, personal loans outstanding  (excluding unearned finance charges and
deferred loan fees) increased $175 million, or 15%, as compared to $135 million,
or 13%,  in 1998.  Personal  loans  are  either  secured  or  unsecured  and are
primarily  used by the customer to make specific  purchases of consumer goods or
undertake  personal debt  consolidation.  As of December 31, 1999 and 1998,  the
average balance of a personal loan was approximately $2,250 and $2,100.

During 1999,  retail sales contracts  outstanding  (excluding  unearned  finance
charges and deferred loan fees) grew $3 million,  or 1%. Retail sales  contracts
are  generally  acquired  without  recourse  to  the  originating  merchant  and
establish a customer  relationship  for developing  future loan business.  Where
these  contracts  result from the sale of consumer  goods,  payment is generally
secured by such goods. Retail sales contracts are generally acquired through the
originating  merchant;  the  Company  had  such  arrangements  with  over  3,000
merchants  at  December  31,  1999.  The  number of such  arrangements  has been
purposely  reduced  over the past two years,  as the  Company has  attempted  to
eliminate unprofitable relationships. This reduction was substantially completed
in 1999, thus the portfolio runoff  experienced in 1998 has leveled off in 1999.
At December 31, 1999 and 1998,  the average  balance of a retail sales  contract
was approximately $825 and $800.

As part of its consumer  finance line of business,  the Company makes available,
at the option of its customers,  credit life,  credit  accident and health,  and
credit  casualty  insurance  products.  The Company  does not sell  insurance to
non-customers.  Credit  insurance sold by the Company is written by unaffiliated
insurance  companies and is  substantially  all reinsured by the Company,  which
earns reinsurance premiums thereon.

Yield Written

At December 31, 1999, 1998 and 1997 the average portfolio yield written by loan
type was as follows:
<TABLE>
                                              1999         1998           1997
                                              ----         ----           ----

<S>                                          <C>           <C>           <C>
         Real estate secured loans           12.5%         12.7%         12.7%
         Personal loans                      24.8%         25.1%         25.2%
         Retail sales contracts              18.9%         19.0%         19.0%

</TABLE>

See  discussion on yields in  Management's  Discussion and Analysis of Financial
Condition and Results of Operations in Item 7.


<PAGE> 6


Geographic Distribution

Geographic   diversification  of  consumer  finance   receivables   reduces  the
concentration of credit risk associated with a recession in any one region.  The
largest concentrations of consumer finance receivables,  net (excluding unearned
finance charges,  deferred loan fees and allowance for credit losses),  by state
were as follows:
<TABLE>

(Dollars in thousands)                                           December 31,
                             ---------------------------------------------------------------------------------
                                        1999                           1998                        1997
                             ---------------------------    --------------------------  ----------------------
                               Amount        Percent           Amount      Percent        Amount       Percent
                               ------        -------         --------      -------        ------       -------

<S>                          <C>                   <C>    <C>                     <C> <C>                    <C>
Colorado                     $   309,384           10%    $     228,999           9%  $     192,046          9%
Tennessee                        306,499           10           263,923          11         244,716         11
Texas                            293,836           10           341,159          14         241,843         11
North Carolina                   257,719            9           223,935           9         206,796          9
California                       232,493            8           149,316           6         192,081          9
Florida                          229,132            8           104,372           4         120,685          5
Louisiana                        134,303            5           121,239           5         110,135          5
South Carolina                   162,595            5           142,950           6         127,732          6
Virginia                         140,870            5           126,182           5         110,307          5
Mississippi                      121,507            4           106,889           4          98,289          4
Other                            773,111           26           684,939          27         609,759         26
                           -------------    ---------     -------------    --------   -------------    -------
Total                      $   2,961,449          100%    $   2,493,903         100%  $   2,254,389        100%
                           =============    =========     =============    ========      ==========    =======

</TABLE>


The relatively high proportion of the business in Colorado reflects the presence
of the Company's banking subsidiary, FCIB, in that state.

Credit Loss Experience

The Company closely monitors  portfolio  delinquency and loss rates in measuring
the quality of the portfolio and the potential for ultimate  credit  losses.  An
account is considered delinquent for financial reporting purposes when a payment
is 60 days or more past due, based on the original terms of the contract.  Under
the Company's policy, non-real estate secured, delinquent accounts generally are
charged  off when they  become 180 days  contractually  delinquent.  Real estate
secured,   delinquent  accounts  are  handled  on  a  case-by-case  basis,  with
foreclosure proceedings typically beginning when they are between 60 and 90 days
contractually delinquent.  Collection efforts continue after an account has been
charged off until the customer obligation is satisfied or until it is determined
that the obligation is not collectible or that the cost of continuing collection
efforts will not be offset by the potential recovery.

Management  of the Company  attempts  to control  customer  delinquency  through
careful evaluation of each borrower's application and credit history at the time
the loan is made or acquired,  and appropriate  collection activity. The Company
also seeks to reduce its risk by focusing on consumer lending,  making a greater
number of smaller  loans than would be  practical  in  commercial  markets,  and
maintaining disciplined control over the underwriting process.

<PAGE> 7


The Company  maintains an allowance for credit  losses  inherent in the consumer
finance receivables  portfolio.  The allowance is based on an ongoing assessment
of the  probable  estimated  losses  inherent in the  portfolio.  This  analysis
provides a mechanism for ensuring that estimated losses  reasonably  approximate
actual observed losses.  See discussion in "Allowance for Credit Losses" in Item
7.

Funding Composition

A  relatively  high ratio of  borrowings  to invested  capital is  customary  in
consumer  finance  activities due to the quality and term of the assets employed
by the  business.  As a result,  the spread  between the revenues  received from
loans and interest expense is a significant factor in determining the net income
of the Company.

The Company funds its consumer finance operations  principally  through net cash
flows from operating  activities,  short-term borrowings in the commercial paper
market, and issuances of long-term debt and customer  deposits.  The Company had
commercial  paper  outstanding  at December 31, 1999 of $242.2 million at a 6.2%
weighted average interest rate.

As of December 31, 1999, the Company had two revolving credit  facilities with a
group of lenders permitting  aggregate  borrowing of up to $1.2 billion.  Of the
$1.2 billion available credit, Washington Mutual has the ability to borrow up to
$500 million. There were no borrowings under these facilities at year-end 1999.

The Company also obtains funding by issuing debt securities.  Notes  outstanding
totaled  approximately  $2.0  billion at December  31, 1999 and $1.4  billion at
December 31, 1998. As of December 31, 1999, the amount  available to the Company
under its current shelf registration statement totaled $450 million.

The Company also,  through its industrial banking  subsidiary,  borrows from the
Federal Home Loan Bank of Topeka ("FHLB") and accepts  customer  deposits.  FHLB
borrowings  totaled  $115.9  million at December  31, 1999 and $73.9  million at
December 31, 1998. Customer deposits totaled $189.9 million at December 31, 1999
and $187.5  million at  December  31,  1998.  Interest  rate  spread and cost of
borrowed funds is presented in "Results of Operations" in Item 7.

Employee Relations

The Company employs  approximately 2,700 full-time  employees.  The Company also
employs part-time employees. None of these employees are represented by a union.
Management considers relations with its employees to be satisfactory.


<PAGE> 8


Risk Factors

In addition to the other  information  in this Annual  Report on Form 10-K,  the
following factors should be considered carefully:

Decline of Collateral Value May Adversely Affect Portfolio Credit Quality

Approximately 47% of the Company's consumer finance receivables outstanding were
secured by real estate at December 31, 1999. Any material decline in real estate
values reduces the ability of borrowers to use home equity to support borrowings
and  increases  the  loan-to-values  of loans  previously  made by the  Company,
thereby weakening  collateral  coverage and increasing the possibility of a loss
in the event of a borrower  default.  Further,  delinquencies,  foreclosures and
losses generally increase during economic slowdowns or recessions. Any sustained
period of such increased delinquencies,  foreclosures and losses could adversely
affect the Company's results of operations and financial condition.

Change in Delinquency Rate

While the  Company  employs  underwriting  criteria  and  collection  methods to
mitigate the risks inherent in loans made to its customers,  no assurance can be
given that such criteria or methods will afford adequate protection against such
risks.  In the event the  Company's  portfolio of consumer  finance  receivables
experiences higher delinquencies,  foreclosures or losses than anticipated,  the
Company's  results of  operations  or  financial  condition  could be  adversely
affected.

Impact of Regulation and Legislation; Regulatory Enforcement

The Company's  operations are, for the most part, regulated by federal and state
consumer finance laws or similar legislation. All of the states in which finance
subsidiaries  of the Company are licensed to do business  have laws,  which vary
from state to state, regulating the consumer finance business. These laws, among
other things,  typically limit the size of loans, set maximum interest rates and
maximum  maturities  and regulate  certain  lending and  collection  activities.
Although consumer finance laws have been in effect for many years,  amending and
new legislation is frequently proposed. The Company is unable to predict whether
or when any such proposals might ultimately be enacted into law or to assess the
impact any such enactment might have on the Company. In addition,  as it accepts
customers' deposits,  the industrial banking subsidiary is subject to regulation
by the FDIC and the relevant state banking authorities.


<PAGE> 9

The  Company's  lending  activities  are  subject  to the  Truth-in-Lending  Act
(including  the Home  Ownership  and Equity  Protection  Act of 1994),  the Fair
Housing Act, the Equal Credit  Opportunity  Act, the Fair Credit  Reporting Act,
the Real Estate Settlement  Procedures Act, the Home Mortgage Disclosure Act and
the Fair Debt Collection Practices Act and regulations  promulgated  thereunder,
as well as other federal, state and local statutes and regulations affecting the
Company's  activities.  The Company is also subject to the rules and regulations
of,  and  examinations   by,  state  regulatory   authorities  with  respect  to
originating,  processing,  underwriting  and  servicing  loans.  These rules and
regulations,  among  other  things,  (i)  impose  licensing  obligations  on the
Company,  (ii) establish eligibility criteria for mortgage loans, (iii) prohibit
discrimination,  (iv) provide for inspections and appraisals of properties,  (v)
require credit reports on loan applicants, (vi) regulate assessment, collection,
foreclosure and claims handling,  (vii) mandate certain  disclosures and notices
to borrowers and (viii) in some cases, fix maximum interest rates, fees and loan
amounts.  Failure to comply with these  requirements  can lead to termination or
suspension of the Company's ability to make and collect loans, certain rights of
rescission  for  mortgage  loans,   class  action  lawsuits  and  Administrative
enforcement   actions.   Recent  Federal   legislation,   the  Riegle  Community
Development and Regulatory Improvement Act, has focused additional regulation on
mortgage loans having  relatively  higher  origination  fees and interest rates,
such as those made by the  Company,  and the Company  expects its business to be
the focus of additional United States federal and state legislation,  regulation
and possible enforcement in the future.

Additionally, the Company's sale of credit life, credit accident and health, and
credit  casualty  insurance  to its  customers  is subject to state and  federal
statutes and regulations.  Failure to comply with any of the foregoing state and
federal requirements could lead to imposition of civil penalties on the Company,
class action lawsuits and administrative enforcement actions.

The  laws  and   regulations   described   above  are  subject  to  legislative,
administrative  and  judicial  interpretation,  and  certain  of these  laws and
regulations  have  been  infrequently  interpreted  or  only  recently  enacted.
Infrequent  interpretations  of these laws and  regulations or an  insignificant
number  of  interpretations  of  recently  enacted  regulations  can  result  in
ambiguity  with respect to permitted  conduct under these laws and  regulations.
Any ambiguity  under the regulations to which the Company is subject may lead to
regulatory  investigations or enforcement  actions and private causes of action,
such as class action lawsuits, with respect to the Company's compliance with the
applicable laws and regulations. As a consumer lender, the Company has been, and
expects to continue to be, subject to regulatory enforcement actions and private
causes  of  action  from  time to  time  with  respect  to its  compliance  with
applicable laws and  regulations.  The Company's  lending  practices have in the
past  been  and  currently  are  under   regulatory   review  by  various  state
authorities.  Although the Company utilizes systems and procedures to facilitate
compliance with these legal  requirements  and believes that it is in compliance
in all material respects with applicable laws, rules and regulations,  there can
be no assurance that more  restrictive  laws,  rules and regulations will not be
adopted  in the  future,  or that  existing  laws  and  regulations  will not be
interpreted  in a more  restrictive  manner,  which could make  compliance  more
difficult or expensive. See "Governmental Regulation."


<PAGE> 10

Risk of Litigation

In the ordinary  course of its  business,  the Company is subject to claims made
against it by  borrowers  arising  from,  among  other  things,  losses that are
claimed to have been  incurred  as a result of  alleged  breaches  of  fiduciary
obligations, misrepresentations, errors and omissions of employees, officers and
agents of the Company,  incomplete  documentation and failures by the Company to
comply with various laws and regulations applicable to its business. The Company
believes that liability with respect to any currently  asserted  claims or legal
actions is not likely to be material to the  Company's  consolidated  results of
operations or financial  condition.  However,  any claims asserted in the future
may result in legal expenses or liabilities  that could have a material  adverse
effect on the Company's results of operations and financial  condition and could
distract members of management from the general operations of the Company.

Fluctuations in Interest Rates May Adversely Affect Profitability

The profitability of the Company may be adversely  affected during any period of
rapid changes in interest rates, as substantially all consumer loans outstanding
are written at a fixed rate. A substantial  and  sustained  increase in interest
rates could adversely affect the spread between the rate of interest received by
the  Company  on its  loans  and the  interest  rates  payable  under  its  debt
agreements.  Such interest rate  increases  could also affect the ability of the
Company to  originate  loans.  A  significant  decline in  interest  rates could
decrease the balance of the consumer finance receivables portfolio by increasing
the level of loan prepayments.  See  "Quantitative  and Qualitative  Disclosures
About Market Risk" in Item 7A. for sensitivity analysis.

Competition Could Adversely Affect Results of Operations

Competition in the consumer  finance  business is intense.  The consumer lending
market is highly  fragmented and has been serviced by commercial  banks,  credit
unions and savings institutions, as well as by other consumer finance companies.
Many of  these  competitors  have  greater  financial  resources  and  may  have
significantly lower costs of funds than the Company.  Even after the Company has
made a loan to a borrower,  the Company's  competitors may seek to refinance the
Company's loan in order to offer additional loan amounts or reduce payments.  In
addition,  if the Company  expands  into new  geographic  markets,  it will face
competition  from lenders with established  positions in these locations.  There
can be no  assurance  that  the  Company  will be able to  continue  to  compete
successfully in these markets.


<PAGE> 11


Item 2.    Properties

The Company owns its 71,000 square foot headquarters building, which it built in
1994 on 6 acres of land in Tampa, Florida.

The Company's  branch offices,  located in 25 states,  are leased  typically for
terms of three to five years with options to renew.  Typical  locations  include
shopping  centers,  office  buildings  and  storefronts,  and are  generally  of
relatively  small  size  sufficient  to  accommodate  a staff  of four to  eight
employees.

Commencing  October,  1999,  the Company  leases  50,000 square feet of space in
Pensacola,  Florida, which is used for centralized  underwriting,  servicing and
collections activities.

See Note 12 to the Consolidated  Financial Statements for additional information
on rental expense and lease commitments.

Item 3.    Legal Proceedings

The Company and certain of its  subsidiaries are parties to various lawsuits and
proceedings  arising in the ordinary  course of  business.  The Company has also
been named as a defendant in a number of class action  suits,  in which  various
industry-wide  practices  arising from  routine  business  activities  are being
challenged and various  damages are being sought.  Certain of these lawsuits and
proceedings arise in jurisdictions, such as Alabama and Mississippi, that permit
damage awards  disproportionate  to the actual economic damages incurred.  Based
upon  information  presently  available,  the  Company  believes  that the total
amounts that will ultimately be paid arising from these lawsuits and proceedings
will not have a material adverse effect on the Company's consolidated results of
operations  and  financial  condition.  However,  it  should  be noted  that the
frequency of large damage awards,  including large punitive damage awards,  that
bear little or no relation to actual economic  damages incurred by plaintiffs in
jurisdictions like Alabama and Mississippi continues to increase and creates the
potential for an unpredictable judgment in any given suit.


<PAGE> 12


                                     PART II

Item 5.    Market for the Registrant's Common Equity and Related Stockholder
           Matters

The Company is an indirect wholly-owned  subsidiary of Washington Mutual and the
Company's  common stock is not traded on any  national  exchange or in any other
established market.

Payment  of  dividends  is  within  the  discretion  of the  Company's  Board of
Directors.  Provisions of certain of the Company's debt agreements  restrict the
payment of dividends to a maximum prescribed portion of cumulative  earnings and
contributed  capital and otherwise provide for the maintenance of minimum levels
of equity and  maximum  leverage  ratios.  Dividends  will be paid when  capital
exceeds  the  amount  of  debt  to  tangible  capital  (leverage  ratio)  deemed
appropriate  by  management.  This  leverage  ratio  will be  managed  with  the
intention  of  maintaining   the  existing   credit  ratings  on  the  Company's
outstanding obligations.  The Company declared and paid dividends totaling $14.5
million during 1999 and $36.5 million during 1998.

Item 6.  Selected Financial Data

The following selected financial data are taken from the Company's  consolidated
financial  statements.   The  data  should  be  read  in  conjunction  with  the
accompanying  consolidated  financial  statements  and related notes in Item 8.,
Management's  Discussion and Analysis in Item 7. and other financial information
included in this Form 10-K. Per share information is not included because all of
the Company's stock is owned by Washington Mutual.

<TABLE>


                                                      As of, or For the Years Ended December 31,
                               ------------------------------------------------------------------------------------
                                        1999              1998              1997             1996              1995
                               -------------     -------------    --------------    -------------    --------------
                                                                (Dollars in thousands)

<S>                            <C>               <C>              <C>               <C>              <C>
Net interest income            $     224,805     $     203,432    $      180,605    $     196,375    $      204,985

Net income                     $      72,992     $      52,887    $       46,287    $      62,518    $       65,297

Consumer finance
  receivables, net             $   2,961,449     $   2,493,903    $    2,254,389    $   2,123,103    $    2,082,944

Total assets                   $   3,227,557     $   2,744,710    $    2,509,606    $   2,371,376    $    2,328,747

Total debt                     $   2,353,963     $   1,987,990    $    1,830,404    $   1,750,776    $    1,316,685

Total equity                   $     475,158     $     419,330    $      398,184    $     369,240    $      473,684


</TABLE>


<PAGE> 13


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

Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations  should  be read  in  conjunction  with  the  Consolidated  Financial
Statements and related notes in Item 8. and other financial  information in Item
1.

Overview

The  Company  produced  record  results in 1999,  achieving  net income of $73.0
million, which represents a 38% increase over the $52.9 million reported in 1998
and a 58%  increase  over  1997's  reported  net  income of $46.3  million.  The
following are key highlights of the Company's performance:

o    Return on assets improved to 2.48% from 2.05% in 1998 and 1.94% in 1997.

o    Net consumer finance receivables increased 18.7% during 1999, demonstrating
     very strong growth compared to 10.6% in 1998.

o    Yields earned on consumer finance  receivables  declined from 17.0% in 1998
     to 16.7% in 1999,  however,  this was due to a shift in product mix towards
     lower  yielding real estate  secured loans and  increased  amortization  of
     deferred loan origination costs.

o    Both net interest  spread and net interest  margin were consistent with the
     prior year, in spite of the decline in yields earned discussed above.  This
     is  primarily  due  to a  reduction  in  cost  of  funds  as  discussed  in
     "Consolidated  Results of Operations."  Net interest spread  represents the
     difference between the yield on the Company's  interest-earning  assets and
     the interest rate paid on its borrowings.  Net interest  margin  represents
     the ratio of net interest income to average earning assets.

o    Operating  efficiency,  defined  as the  ratio  of  non-interest  operating
     expenses,  excluding  the  amortization  of  goodwill,  to  total  revenue,
     improved  from  45.3%  and  44.9% in 1997  and  1998 to 37.1% in 1999,  due
     largely to the effect of increasing loan volume while  maintaining  control
     over fixed costs,  coupled  with the impact of  increased  deferral of loan
     origination costs.

o    Delinquencies  (accounts  contractually past-due greater than 60 days) as a
     percentage  of net  consumer  finance  receivables  decreased  from 2.5% at
     December  31, 1998 to 2.3% at December  31,  1999,  as a result of improved
     underwriting and collection  efforts,  coupled with the increased growth in
     the portfolio.

o    Net credit  losses  totaled  $80.8 million in  1999, as  compared to  $73.9
     million  in  1998  and $65.1   million in 1997.   Net credit  losses  as  a
     percentage of  average  consumer finance  receivables  (excluding  unearned
     finance charges and deferred loan fees),  however, were 2.9%, 3.1% and 3.0%
     in 1999, 1998 and 1997.


<PAGE> 14

Segment Results

The Company is managed along two major segments:  consumer finance and consumer
banking.  Following is an overview of the performance of each segment in 1999:

Consumer Finance

o    Net income  increased 41% to $66.5 million in 1999,  from $47.1 million in
     1998.  Net income totaled $40.9 million in 1997.

o    Return on assets in 1999 improved to 2.58% from 2.06% and 1.93% in 1998 and
     1997.

o    The consumer finance receivables portfolio  experienced  significant growth
     during 1999, totaling $407.5 million, or 18%.

o    Net  interest  margin  decreased  as a result of slight  yield  erosion  on
     receivables  caused by the shift in product mix toward real estate  secured
     loans,  coupled with the impact of increased  amortization of deferred loan
     origination costs,  which were significantly  higher in 1999. These factors
     were partially  offset by a reduction in the cost of funds, as discussed in
     "Consolidated Results of Operations."

o    The improved  efficiency  ratio of 36.8% in 1999,  as compared to 45.1% and
     45.6% in 1998 and 1997 was  largely  a result  of tight  cost  control  and
     strong volume growth, coupled with the impact of increased deferral of loan
     origination costs.

o    Net credit losses were controlled during a time of high receivables growth,
     totaling  $80.1  million in 1999,  as compared to $73.0 million in 1998 and
     $64.4  million  in 1997.  Net  credit  losses as a  percentage  of  average
     consumer  finance  receivables  (excluding  unearned  finance  charges  and
     deferred loan fees), were 3.3%, 3.4% and 3.3% in 1999, 1998 and 1997.

Consumer Banking

o    Net income  increased  12% to $6.5  million in 1999,  from $5.8 million in
     1998.  Net income  totaled $5.4 million in 1997.

o    Return on assets in 1999 decreased to 1.78% from 2.01% and 2.02% in 1998
     and 1997.

o    The consumer banking receivables portfolio experienced strong growth during
     1999, totaling $79.9 million, or 27%.

o    Net  interest  margin  decreased  as a result of slight  yield  erosion  on
     receivables,  coupled with an increased cost of funds due to a reduction in
     customer deposits and higher rates paid on FHLB borrowings.

o    Cost control  remains  strong,  as evidenced by the  operating  expenses to
     assets ratio of 1.9% in 1999, 2.0% in 1998 and 2.4% in 1997. This indicates
     that  expenses have  increased at a slower rate than the segment's  growth,
     signifying leverage of its existing infrastructure.

o    Net credit losses remain low, decreasing to $680 thousand in 1999 from $850
     thousand  in 1998 and  $685  thousand  in  1997.  Net  credit  losses  as a
     percentage of average  consumer  finance  receivables  (excluding  unearned
     finance charges and deferred loan fees),  were 0.2%, 0.3% and 0.3% in 1999,
     1998 and 1997.


<PAGE> 15


Consolidated Results of Operations

Net Interest Income before Provision for Credit Losses

Net interest income before provision for credit losses for 1999 increased 15% to
$325.4  million,  compared to $283.2 million in 1998 and $247.2 million in 1997.
Net interest  margin for 1999 was 11.0%,  compared to 11.1% in 1998 and 10.4% in
1997.

The increase in net interest  income before  provision for credit losses in 1999
reflects  growth in average net consumer  finance  receivables  to $2.8 billion,
which was $397 million,  or 17%, greater than the average balance for 1998. This
is  primarily a result of  management's  implementation  of an  internal  growth
initiative  through  the  branch  network,  as well  as an  ongoing  pursuit  of
strategic acquisitions. Partially offsetting this portfolio growth is a 30 basis
point  decrease  in  portfolio  yield.  This  yield  compression  is a result of
remixing the  portfolio to a larger  percentage  of  lower-yielding  real estate
secured loans and the increase in deferred loan  origination  costs as discussed
in "Overview." The other factor adversely  impacting the portfolio yield was the
lower  average  permissible  rate,  due to rising  average loan size,  given the
structure of various state interest rate regulation thresholds.

In  order to  finance  the  growth  in  receivables,  average  debt  outstanding
increased  $311.9  million,  or 15.5%,  to $2.3 billion for 1999, as compared to
1998.  The overall cost of debt  decreased 20 basis  points,  as compared to the
prior  year.  The mix of debt was  shifted to longer  term,  senior  debt due to
management's strategy to better match the behavioral duration of its assets, and
to secure  funding  in  advance of the Year 2000  year-end  liquidity  concerns.
However,  offsetting  this  shift in funding  mix was a  decrease  in rate paid,
primarily for the longer term senior debt.  This  improvement in rate was due to
lower  credit  spreads  which  were  partially  the  result of the  removal of a
"Negative  Watch" by  Moody's  rating  agency.  Further,  the  senior  debt rate
benefited from replacing maturing higher rate debt (issued when the general rate
environment was higher) with lower rate debt in the  environment  experienced in
1999.

<PAGE> 16


The  following  chart  reflects  the average  outstanding  balances  and related
effective yields in 1999, 1998 and 1997, as described above:


<TABLE>

(Dollars in thousands)                                         Year Ended December 31,
                           ------------------------------------------------------------------------------------------
                                       1999                           1998                           1997
                           --------------------------     --------------------------    -----------------------------
                               Average                        Average                       Average
                               Balance           Rate         Balance           Rate        Balance            Rate
                           -----------    -----------    ------------    -----------    ------------     ------------

Earning Assets:
  Real estate secured
<S>                        <C>                    <C>     <C>                    <C>    <C>                     <C>
     loans                 $ 1,275,932           12.6%   $  1,045,671           12.6%   $    929,688             12.5%
  Personal loans             1,217,663           22.2       1,044,251           22.7         935,590             22.4
  Retail sales contracts       280,458           11.9         286,982           12.6         338,405             12.0
                           -----------    -----------    ------------    -----------    ------------     ------------
                             2,774,053           16.7       2,376,904           17.0       2,203,683             16.6

Investment securities          180,005            6.0         172,251            6.6         162,624              6.4
                           -----------    -----------    ------------    -----------    ------------     ------------

Total earning assets       $ 2,954,058           16.1%   $  2,549,155           16.3%   $  2,366,307             15.9%
                           ===========    ============   ============    ===========    ============     ============

Borrowings:
  Senior debt              $ 1,708,555            6.8%   $  1,432,743            7.1%   $  1,314,009              7.3%
  Commercial paper             323,475            5.7         368,855            5.6         406,992             6.1
  Customer deposits            196,583            5.5         172,850            5.8         150,837              5.6
  FHLB borrowings               90,055            5.3          32,362            5.2          18,431              5.9
                           -----------    -----------    ------------    -----------    ------------     ------------

Total borrowings           $ 2,318,668            6.5%   $  2,006,810            6.7%   $  1,890,269              6.8%
                           ===========    ============   ============    ===========    ============     ============

Net interest spread                               9.6%                           9.6%                             9.1%
                                          ============                   ===========                     ============

Net interest margin                              11.0%                          11.1%                            10.4%
                                          ============                   ===========                     ============

</TABLE>



Provision for Credit Losses

The  provision for credit  losses  during 1999 was $100.6  million,  compared to
$79.8  million in 1998 and $66.6  million in 1997.  In 1999,  the  provision for
credit  losses  was 3.6% of  average  consumer  finance  receivables  (excluding
unearned  finance  charges and deferred loan fees), as compared to 3.4% for 1998
and 3.0% in 1997. See further discussion in "Allowance for Credit Losses."

Other Operating Income

Other operating income increased 9% in 1999 to $29.5 million,  compared to $27.1
million in 1998 and $26.6 million in 1997.  Other operating  income is comprised
of revenue  earned from the sale of various  ancillary  products to borrowers at
the branch locations  including life insurance,  accident and health  insurance,
property and casualty insurance,  accidental death and dismemberment  insurance,
involuntary  unemployment  insurance and auto club memberships.  The increase in
1999 is related to the  increase  in the number of loans  originated  during the
year,  offset by the shift in  originations  to loans which tend to have a lower
insurance penetration.


<PAGE> 17

Operating Expenses

Operating expenses in 1999 were 5% lower, or $135.6 million,  compared to $143.0
million in 1998 and $131.1 million in 1997. However,  included in the 1998 total
was $4.5  million for the  settlement  of class action  litigation  in which the
Company was a defendant and various non-recurring charges totaling $3.1 million.
Without  the effect of these  non-recurring  items,  operating  expenses in 1998
would have been $135.4  million.  The company's  ability to maintain  consistent
operating  expenses  during a period of high  growth  reflects  both strong cost
control and the effect of higher deferred loan origination costs.

Provision for Income Taxes

The provision for income taxes in 1999 was $45.7  million,  which  represents an
effective rate of 38.5%.  This compares to $34.7  million,  or 39.6% in 1998 and
$29.7 million, or 39.1% in 1997.

Financial Condition

Allowance for Credit Losses

In order to establish the Company's  allowance for credit  losses,  the consumer
finance  receivables  portfolio is segmented  into two  categories:  real estate
secured and non-real estate secured (personal loans and retail sales contracts).
The  determination  of the  level  of  the  allowance  for  credit  losses  and,
correspondingly,  the provision for loan losses for these homogeneous loan pools
rests  upon  various  judgments  and  assumptions  used to  determine  the  risk
characteristics  of each  portfolio.  These  judgments are supported by analyses
that fall into three general categories:  (i) economic conditions as they relate
to the Company's  current  customer  base and  geographic  distribution;  (ii) a
predictive  analysis  of the  outcome  of the  current  portfolio  (a  migration
analysis); and (iii) prior loan loss experience. Additionally, every real estate
secured  loan that  reaches 60 days  delinquency  is reviewed  by the  Company's
credit administration management to assess collectibility and determine a future
course of action, at times resulting in the Company foreclosing on the property.


<PAGE> 18


Activity in the Company's allowance for credit losses is as follows:

<TABLE>


                                                        Year Ended December 31,
                                        ----------------------------------------------------
(Dollars in thousands)                           1999                1998               1997
                                        -------------       -------------      -------------

<S>              <C>                    <C>                 <C>                <C>
Balance, January 1                      $      80,493       $      74,323      $      70,045
Provision for credit losses                   100,590              79,760             66,600
Amounts charged off:
   Real estate secured loans                   (1,807)             (2,125)             (1,292)
   Personal loans                             (82,438)            (73,210)            (64,460)
   Retail sales contracts                     (12,558)            (14,417)            (13,946)
                                        --------------      --------------     --------------
                                              (96,803)            (89,752)            (79,698)
Recoveries:
   Real estate secured loans                      398                 521                556
   Personal loans                              12,629              12,593             11,538
   Retail sales contracts                       3,001               2,774              2,553
                                        -------------       -------------      -------------
                                               16,028              15,888             14,647
                                        -------------       -------------      -------------
Net charge-offs                               (80,775)            (73,864)            (65,051)

Allowances on notes purchased                    -                    274              2,729
                                        -------------       -------------      -------------
Balance, December 31                    $     100,308       $      80,493      $      74,323
                                        =============       =============      =============




Allowance for credit  losses as a
  percentage  of  December 31 consumer
  finance receivables (excluding unearned
  finance charges and deferred loan fees)         3.3%                3.1%               3.2%

Net charge-offs as a percentage of average
  consumer finance receivables (excluding
  unearned finance charges and deferred
  loan fees)                                      2.9%                3.1%               3.0%

Provision for credit losses as a percentage
  of average consumer finance receivables
  (excluding unearned finance charges and
  deferred loan fees)                             3.6%                3.4%               3.0%
</TABLE>



While  charge-offs as a percentage of average consumer finance  receivables have
decreased  in  recent  years,  a number  of  underlying  factors  have  prompted
management  to  increase  the  allowance  for  credit  losses.  Included  in the
assessment to determine the allowance for credit losses at December 31, 1999 are
the following qualitative factors:

o    Changing  economic  conditions - although the Company's  economic  forecast
     indicates that overall,  the U.S.  economy should remain strong,  there are
     several  underlying trends which are beginning to impact the performance of
     the Company's portfolio.  Current rising interest rates may have the effect
     of overextending some customers, many of whom maintain variable-rate credit
     cards and first mortgages from other lenders.

o    There has recently  been a slight  deterioration  in late stage (60 days or
     more)   delinquency   and  increasing   bankruptcy  in  the  personal  loan
     portfolios. These trends are being closely monitored and appropriate action
     is  being  taken.   Nonetheless,   these  factors  are  considered  in  the
     establishment of the allowance.


<PAGE> 19

o    Recent  rapid  growth in the  portfolio - there is some  potential  risk in
     strong growth via the extension of additional credit to existing customers.
     In addition,  there is a natural lag effect in  charge-offs  as a portfolio
     grows.  Loans tend not to become  delinquent  until after they have been in
     the portfolio for some time. Thus, the charge-off rate in a rapidly growing
     portfolio  will tend to  over-state  the credit  quality of the  portfolio.
     Management  analyzes  the  portfolio  on a  vintage  basis  (by  period  of
     origination)  and  has not  detected  any  areas  of  significant  concern.
     Nonetheless,  the  charge-off  ratio  can not be relied  upon  solely as an
     indicator of portfolio credit quality.

o    Recent  expansion  into new markets - the Company has  recently  opened new
     branches  in  Illinois  and  acquired  several  branches  in new markets in
     Kentucky.  While  due  diligence  and care was  taken  with  assessing  the
     creditworthiness  of  these  geographic  areas  and  acquired   portfolios,
     management  expects higher losses initially upon entry into new markets and
     from  the  recent  acquisition,  and  accordingly  has  established  higher
     allowance for credit losses

Due to the significant growth in the portfolio during the year, coupled with the
presence of the above  factors at December 31, 1999,  the  allowance  for credit
losses  increased 24.6% as compared to December 31, 1998.  Management  considers
the allowance for credit  losses  adequate to cover losses  inherent in the loan
portfolio at December 31, 1999.  No assurance can be given that the Company will
not,  in any  particular  period,  sustain  credit  losses  that are  sizable in
relation to the amount reserved, or that subsequent evaluation of the portfolio,
in light of the factors then prevailing,  including economic  conditions and our
ongoing  examinations  process  and that of our  regulators,  will  not  require
significant increases in the allowance for credit losses.

The  following  table  sets  forth,  by loan  type,  the  amount of  receivables
delinquent  for 60 days or more, on a contractual  basis,  and the ratio of that
amount to gross consumer finance receivables outstanding:

<TABLE>


(Dollars in thousands)                                          December 31,
                                ------------------------------------------------------------------------
                                          1999                       1998                     1997
                                ----------------------     ---------------------     -------------------
<S>                             <C>                <C>     <C>               <C>     <C>             <C>
Real estate secured loans       $     9,259        0.6%    $    8,093        0.6%    $   8,473       0.8%
Personal loans                       62,875        4.0         56,449        4.1        51,613       4.3
Retail sales contracts                9,137        2.8         10,171        3.1        11,498       3.2
                                -----------    --------     ---------    --------     --------    ------

Total                           $    81,271        2.3%    $   74,713        2.5%    $  71,584       2.7%
                                ===========    =======     ==========    =======     =========    ======

</TABLE>


<PAGE> 20


At  December  31,  1999 and 1998,  the  Company  held  foreclosed  single-family
dwellings with a carrying value of approximately  $3.6 million and $2.6 million.
These balances total 0.3% and 0.2% of the real estate secured loans  outstanding
as of these dates.

Asset / Liability Management

The Company's  long-range  profitability  depends not only on the success of the
services  offered to its customers and the credit quality of its portfolio,  but
also the extent to which  earnings  are not  negatively  affected  by changes in
interest  rates.  Accordingly,  the  Company's  philosophy  is  to  maintain  an
approximate match of the interest rate sensitivity between its  interest-bearing
assets and liabilities. The Company's consumer finance receivables are primarily
fixed rate and have initial terms ranging from 3 to 360 months.  However,  loans
are generally paid off or refinanced prior to their stated maturity.  Therefore,
the Company's asset/liability  management requires a high degree of analysis and
estimation.   The  Company  funds  its  interest-bearing   assets  through  both
internally  generated  equity  and  external  debt  financing.  See Item 7a. for
further discussion.

Liquidity

The Company funds its operations through a variety of corporate borrowings.  The
primary source of these  borrowings is corporate debt  securities  issued by the
Company.  At December 31, 1999,  twelve different  fixed-rate senior debt issues
totaling $2.0 billion were outstanding, with a weighted average cost of 6.7%. To
meet the Company's  short-term  funding needs,  daily trades of commercial paper
are executed. The Company has a commercial paper program with several investment
banks which provides $700 million in borrowing  capacity.  At December 31, 1999,
twenty-two  different  commercial paper borrowings  totaling $242.2 million were
outstanding,  with a  weighted  average  cost of 6.2%.  The  Company's  targeted
funding strategy is to maintain a mix between long and short-term  borrowings of
75% to 25%. At December 31, 1999,  the split  between  long and  short-term  was
approximately  84% to 16%.This mix arose  because,  towards the end of 1999, the
Company  intentionally  shifted to long-term  debt, in part to mitigate the Year
2000 funding risk.

FCIB raises funds through both customer deposits and borrowings with the Federal
Home  Loan  Bank  of  Topeka  ("FHLB").   At  December  31,  1999,  the  banking
subsidiary's  outstanding  debt totaled $305.8 million,  with a weighted average
cost of 5.7%.

The Company also  maintains  two revolving  credit  agreements  with  twenty-one
syndicate lenders which provide a credit line of up to $1.2 billion primarily to
support  the  commercial  paper  borrowings,  thus  providing  greater  than 1:1
coverage  of the  outstanding  borrowings  at any given  time.  Of this  amount,
Washington  Mutual has the ability to borrow up to $500  million.  There were no
borrowings under these revolving credit agreements at December 31, 1999.


<PAGE> 21


The following table shows selected sources (uses) of cash:

<TABLE>


(Dollars in thousands)                                        Year Ended December 31,
                                          ----------------------------------------------------
                                               1999                  1998               1997
                                          ------------         --------------       ----------

<S>                                       <C>                  <C>                  <C>
Operations                                $   230,737          $     170,668        $  143,193
Net issuances and repayments of debt      $   367,500          $     181,277        $   96,117
Net originations and purchases
   of consumer finance receivables        $  (573,333)         $    (321,992)       $ (199,898)
Dividends paid                            $   (14,500)         $     (36,500)       $  (17,500)


</TABLE>

Capital Management

The Company  establishes  equity  leverage  targets based upon the ratio of debt
(including  customer  deposits) to tangible equity.  The debt to tangible equity
ratio at December 31, 1999 of 6.00:1 was intentionally  increased from 5.86:1 at
December 31, 1998.  The  determination  of the Company's  dividend  payments and
resulting  capital leverage is managed in a manner consistent with the Company's
desire to maintain strong and improving credit ratings. In addition,  provisions
of certain of the Company's debt agreements restrict the payment of dividends to
a maximum prescribed  proportion of cumulative earnings and contributed capital.
At December 31, 1999,  approximately  $126 million was available  under the debt
agreement restriction for future dividends.

In  addition,  FCIB  met  all  FDIC  requirements  to  be  categorized  as  well
capitalized at December 31, 1999.

Year 2000

This section contains forward-looking  statements that have been prepared on the
basis of  management's  best judgments and currently  available  information and
constitutes a Year 2000 Readiness Disclosure within the meaning of the Year 2000
Readiness  Disclosure  Act  of  1998.  These   forward-looking   statements  are
inherently   subject  to  significant   business,   third-party  and  regulatory
uncertainties  and  contingencies,  many of which are beyond the  control of the
Company.  In addition,  these  forward-looking  statements  are based on current
assessments and remediation plans that are subject to  representations  of third
party service providers and are subject to change. Accordingly,  there can be no
assurance  that the  Company's  results  of  operations  will  not be  adversely
affected by damages resulting from the Year 2000 issue.

The Company  implemented a company-wide  program to renovate,  test and document
the  readiness of its  electronic  systems,  programs and  processes  ("Computer
Systems")  and  facilities to properly  recognize  dates to and through the year
2000.  To date,  neither  the  Company  nor any of its  service  providers  have
experienced any significant  Computer  Systems  failures as a result of the Year
2000 issue.  To date,  the Company  has not had any claims from  customers  with
respect to any damages resulting from Year 2000 issues.


<PAGE> 22

Item 7A.  Quantitative and Qualitative Disclosures About Market Risk.

The tables below represent in tabular form contractual balances of the Company's
financial instruments at their expected maturity dates as well as the fair value
of those  financial  instruments  at December  31, 1999 and 1998.  The  expected
maturity categories take into consideration historical prepayment speeds as well
as  actual  amortization  of  principal  and  do  not  take  into  consideration
reinvestment  of  cash.  Principal  prepayments  are the  amounts  of  principal
reduction  over and above normal  amortization.  The weighted  average  interest
rates for the various assets and liabilities presented are actual as of December
31, 1999 and 1998. The principal / notional amounts and fair values presented in
the table do not include the reserve for loan losses or recourse liability.  See
"Notes to Consolidated  Financial  Statements - Note 16: Approximate Fair Values
of Financial Instruments."

<TABLE>

                                           Principal/Notional Amount Maturing in:
                             -------------------------------------------------------------------                Fair Value
                                                                                                              December 31,
                                 2000       2001       2002       2003        2004    Thereafter      Total           1999
                             ----------  ---------   --------   ---------   --------  ----------   ---------    ----------
Rate sensitive assets:
<S>                           <C>         <C>        <C>        <C>        <C>       <C>        <C>         <C>
  Adjustable rate loans      $   69,063  $  38,136   $ 22,462   $  13,573   $  8,426   $   5,370   $  157,030   $  150,957
    Average interest rate         11.98%     11.68%     11.36%      11.02%     10.67%      10.37%       11.61%
  Fixed rate loans            1,392,480    845,722    398,112     136,991     61,554      69,868    2,904,727    2,902,628
    Average interest rate         19.64      19.30      17.75       14.50      13.10       11.70        18.71
  Adjustable rate securities      5,984        -          -           -         -           -           5,984        5,984
    Average interest rate          7.00        -          -           -         -           -            7.00
Fixed rate securities            24,160     22,586     17,399      26,591     18,315      13,929      122,980      122,980
    Average interest rate          8.05       5.91       5.28        6.25       7.11        6.14         6.52
Cash and cash equivalents        40,008        -          -           -          -           -         40,008       40,008
    Average interest rate          5.90        -          -           -          -           -          5.90
                             ----------  ---------   --------   ---------    -------   ---------   -- -------
                             $1,531,695  $ 906,444   $437,973   $ 177,155$    88,295   $  89,167   $3,230,729$   3,222,557
                             ==========  =========   ========   =========    =======   =========   ==========   ==========
                                  18.70%     18.65%     16.93%      13.00%     11.63%      10.75%       17.72%
                                  =====      =====      =====       =====      =====       =====        =====

Rate sensitive liabilities:
  Savings and money
     market accounts         $   10,076  $   4,216   $    144   $     143   $    143   $     287   $   15,009   $   15,009
  Average interest rate            3.86%      3.86%      3.62%       3.62%      3.62%       3.62%       3.85%
Time deposit accounts           129,229     11,519     11,519       8,914      6,309       7,435     174,925       172,490
  Average interest rate            4.71       5.74       5.71        5.65       5.57        5.59       4.96
Short-term and adjustable-
    rate borrowings             284,175     63,900        -        10,000         -          -      358,075        358,099
  Average interest rate            6.20       5.40        -          5.30         -          -         6.03
Fixed-rate borrowings           245,888    550,000    300,000     150,000    500,000     250,000   1,995,888     1,969,769
  Average interest rate            6.33       6.76       6.15        6.50       6.77        7.25       6.66
                             ----------  ---------   --------   ---------    -------   ---------     ------
                             $  669,368  $ 629,635   $311,663   $ 169,057   $506,452   $ 257,722   $2,543,897   $2,515,367
                             ==========  =========   ========   =========   ========   =========   ==========   ==========
                                   5.92%      6.58%      6.13%      6.38%       6.75%       7.20%       6.44%
                                   ====       ====       ====       ====        ====        ====       ====

</TABLE>



<PAGE> 23

<TABLE>


                                              Principal/Notional Amount Maturing in:
                               ----------------------------------------------------------------             Fair Value
                                                                                                          December 31,
                                   1999       2000       2001       2002       2003  Thereafter     Total         1998
                               --------  ---------   --------  ---------  ---------  ---------- ---------  -----------
Rate sensitive assets:
<S>                           <C>         <C>        <C>       <C>        <C>        <C>        <C>         <C>
  Adjustable rate loans       $  82,224   $ 44,119   $ 28,094  $  17,836  $  11,211  $   7,029  $ 190,513   $  160,531
    Average interest rate         11.66%     10.77%     10.68%     10.62%     10.56%     10.65%     11.11%
  Fixed rate loans            1,148,636    700,615    326,380    106,794     46,347     55,111  2,383,883    2,369,955
    Average interest rate         19.94      19.61      18.17      14.67      13.08      10.37      19.01
  Adjustable rate securities      3,723        -         -          -          -          -         3,723        3,723
    Average interest rate          7.00        -         -          -          -          -          7.00
Fixed rate securities            14,807     14,151     16,203     17,574     31,116     53,246    147,097      147,097
    Average interest rate          4.03       6.11       6.75       7.04       6.79       6.76       6.46
Cash and cash equivalents        24,180        -         -          -          -          -         24,180      24,180
    Average interest rate           -          -         -          -          -          -           -
                             ----------   --------   --------  ---------  ---------  --------- ----------
                             $1,273,570   $758,885   $370,677  $ 142,204  $  88,674  $ 115,386 $2,749,396   $2,705,486
                             ==========   ========   ========  =========   ========  ========= ==========   ==========
                                  18.80%     18.84%     17.10%     13.22%     10.55%      8.72%     17.61%
                                  =====      =====      =====      =====      =====       ====      =====

Rate sensitive liabilities:
  Savings and money
     market accounts           $ 11,303  $   4,749   $    134  $     134  $     134  $     268  $  16,722  $    16,722
  Average interest rate            3.84%      3.84%      3.66%      3.66%      3.66%      3.66%      3.83%
Time deposit accounts           118,518     12,461     12,461     12,461     12,461      2,434    170,796      172,995
  Average interest rate            5.80       5.94       5.99       5.99       5.99       6.01       5.85
Short-term and adjustable-
    rate borrowings             560,823        -       18,900       -        10,000        -      589,723      589,723
  Average interest rate            5.67        -         4.91       -          5.30        -         5.64
Fixed-rate borrowings           299,430    249,497    549,669    149,790    149,881        -    1,398,267    1,422,804
  Average interest rate            7.02       6.40       6.81       6.37       6.59        -         6.71
                               --------  ---------   --------  ---------  ---------  ---------  ---------
                               $990,074  $ 266,707   $581,164  $ 162,385  $ 172,476  $   2,702  $2,175,508 $ 2,202,244
                               ========  =========   ========  =========  =========  =========  ========== ===========
                                   6.07%      6.33%      6.73%      6.34%      6.47%      5.78%      6.33%
                                   ====       ====       ====       ====       ====       ====       ====


</TABLE>

The differences in the asset balances between December 31, 1998 and December 31,
1999 relate primarily to the $481.3 million increase in interest-rate  sensitive
assets  due to growth in the loan  portfolio.  The asset  maturity  profile  has
remained consistent with prior years.

The differences in the maturities of liabilities  were primarily  related to the
increase of  longer-term  maturities,  with a relative  decrease  of  short-term
maturities.  This difference is a result of the intentional decision to lengthen
maturities  in  advance  of the 1999  year-end  to offset  Year  2000  liquidity
concerns.

<PAGE> 24


Item 8.    Financial Statements and Supplementary Data

Report of Independent Certified Public Accountants

To  the  Board  of  Directors  and  Stockholder  of  Washington  Mutual  Finance
Corporation:

We have audited the accompanying  consolidated statements of financial condition
of Washington Mutual Finance Corporation  (formerly known as Aristar,  Inc.) and
subsidiaries  (the  "Corporation")  as of December  31,  1999 and 1998,  and the
related consolidated statements of operations, comprehensive income and retained
earnings,  and cash  flows  for each of the  three  years  in the  period  ended
December  31,   1999.   These   consolidated   financial   statements   are  the
responsibility of the Corporation's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audits.

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

In our opinion,  such consolidated  financial  statements present fairly, in all
material  respects,   the  financial  condition  of  Washington  Mutual  Finance
Corporation  and  subsidiaries as of December 31, 1999 and 1998, and the results
of their  operations  and their  cash  flows for each of the three  years in the
period ended December 31, 1999, in conformity with generally accepted accounting
principles.

DELOITTE & TOUCHE LLP

Tampa, Florida
January 18, 2000


<PAGE> 25


WASHINGTON MUTUAL FINANCE CORPORATION and Subsidiaries

Consolidated Statements of Financial Condition

<TABLE>

(Dollars in thousands, except par value)                                      December 31,
                                                              --------------------------------------
                                                                       1999                1998
                                                              ------------------    ----------------
ASSETS

<S>                                                              <C>                 <C>
Consumer finance receivables, net                                $     2,961,449     $     2,493,903
Investment securities                                                    128,964             150,820
Cash and cash equivalents                                                 40,008              24,180
Property, equipment and leasehold improvements, net                       22,112             12,411
Goodwill, net                                                             51,340              48,166
Other assets                                                              23,684              15,230
                                                                  --------------      --------------

    TOTAL ASSETS                                                 $     3,227,557     $     2,744,710
                                                                 ===============     ===============

LIABILITIES AND STOCKHOLDER'S EQUITY

Liabilities

Short-term debt                                                   $      284,175      $      560,823
Long-term debt                                                         2,069,788           1,427,167
                                                                  --------------      --------------
    Total debt                                                         2,353,963           1,987,990
Customer deposits                                                        189,934             187,518
Accounts payable and other liabilities                                   208,502             149,872
                                                                  --------------      --------------
    Total liabilities                                                  2,752,399           2,325,380
                                                                  --------------      --------------

Commitments and contingencies
  (Notes 12 and 13)

Stockholder's equity
Common stock: $1.00 par value;
  10,000 shares authorized; 1,000
  shares issued and outstanding                                                1                   1
Paid-in capital                                                           48,960              48,960
Retained earnings                                                        427,635             369,143
Accumulated other comprehensive (loss) income                             (1,438)              1,226
                                                                  ---------------     --------------
      Total stockholder's equity                                         475,158             419,330
                                                                  --------------      --------------

    TOTAL LIABILITIES AND
      STOCKHOLDER'S EQUITY                                        $    3,227,557      $    2,744,710
                                                                  ==============      ==============
</TABLE>


See Notes to Consolidated Financial Statements.


<PAGE> 26


WASHINGTON MUTUAL FINANCE CORPORATION and Subsidiaries

Consolidated Statements of Operations, Comprehensive Income
and Retained Earnings

<TABLE>

                                                                 Year Ended December 31,
                                                     -------------------------------------------
(Dollars in thousands)                                      1999         1998             1997
                                                     -----------     -----------     -----------

<S>                                                  <C>             <C>             <C>
Loan interest and fee income                         $   464,179     $   404,954     $   365,719
Investment securities income                              10,825          11,449          10,373
                                                     -----------     -----------     -----------
   Total interest income                                 475,004         416,403         376,092

Interest and debt expense                                149,609         133,211         128,887
                                                     -----------     -----------     -----------

Net interest income before
   provision for credit losses                           325,395         283,192         247,205

Provision for credit losses                              100,590          79,760          66,600
                                                     -----------     -----------     -----------

   Net interest income                                   224,805         203,432         180,605
                                                     -----------     -----------     -----------

Other operating income                                    29,501          27,147          26,555
                                                     -----------     -----------     -----------

Operating expenses:
   Personnel                                              78,259          76,664          69,468
   Occupancy                                              11,414          10,434          10,068
   Advertising                                             8,072           6,516           5,807
   Goodwill amortization                                   3,960           3,617           7,064
   Other                                                  33,889          45,761          38,722
                                                     -----------     -----------     -----------
                                                         135,594         142,992         131,129
                                                     -----------     -----------     -----------

Income before income taxes                               118,712          87,587          76,031

Provision for federal and state income taxes              45,720          34,700          29,744
                                                     -----------     -----------     -----------

Net income                                                72,992          52,887          46,287

Net unrealized holding (losses) gains on
   securities arising during period, net of tax           (2,664)            693             157
                                                     -----------     -----------     -----------

Comprehensive income                                 $    70,328     $    53,580     $    46,444
                                                     ===========     ===========     ===========

Retained earnings

   Beginning of year                                 $   369,143     $   352,756     $   323,969
   Net income                                             72,992          52,887          46,287
   Dividends                                             (14,500)        (36,500)        (17,500)
                                                     -----------     -----------     -----------
   End of year                                       $   427,635     $   369,143     $   352,756
                                                     ===========     ===========     ===========


</TABLE>

See Notes to Consolidated Financial Statements.


<PAGE> 27


WASHINGTON MUTUAL FINANCE CORPORATION and Subsidiaries

Consolidated Statements of Cash Flows

<TABLE>

                                                                             Year Ended December 31,
                                                             ---------------------------------------------------
(Dollars in thousands)                                                 1999                1998             1997
                                                             --------------        ------------     ------------

Operating activities

<S>                                                          <C>                   <C>              <C>
   Net income                                                $       72,992        $     52,887     $     46,287
   Adjustments to reconcile net income to net
       cash provided by operating activities:
      Provision for credit losses                                   100,590              79,760           66,600
      Depreciation and amortization                                  12,577               8,611           11,282
      Increase in accounts payable
         and other liabilities                                       60,165              31,622           12,491
        (Increase) decrease in other assets                         (15,587)             (2,212)           6,533
                                                             --------------        ------------     ------------

   Net cash provided by operating activities                        230,737             170,668          143,193
                                                             --------------        ------------     ------------

Investing activities

   Investment securities purchased                                  (46,460)            (91,477)          (62,582)
   Investment securities matured and sold                            64,131              96,275            45,454
   Net (increase) in consumer finance receivables                  (573,333)           (321,992)         (199,898)
   Net (increase) in property, equipment and leasehold
      improvements                                                  (12,247)             (4,583)             (998)
                                                             --------------        ------------     -------------

   Net cash used in investing activities                           (567,909)           (321,777)         (218,024)
                                                             ---------------       ------------     -------------

Financing activities

   Net increase in customer deposits                                  2,416              24,333           17,047
   Net (decrease) increase in short-term debt                      (276,648)            203,291           (40,474)
   Proceeds from issuance of long-term debt                         941,732             209,653           326,344
   Repayments of long-term debt                                    (300,000)           (256,000)         (206,800)
   Dividends paid                                                   (14,500)            (36,500)          (17,500)
   Proceeds from affiliate transfer                                   -                   4,066               -
                                                             --------------        ------------     -------------

   Net cash provided by financing activities                        353,000             148,843           78,617
                                                             --------------        ------------     ------------

Net increase (decrease) in cash and cash equivalents                 15,828              (2,266)           3,786

Cash and cash equivalents

   Beginning of year                                                 24,180              26,446           22,660
                                                             --------------        ------------     ------------
   End of year                                               $       40,008        $     24,180     $     26,446
                                                             ==============        ============     ============

Supplemental disclosures of cash flow information

   Interest paid                                             $      140,127        $    133,160     $    125,841
   Intercompany payments in lieu of federal and state
    income taxes, net of refunds                             $       38,794        $     30,881     $     23,011

</TABLE>

See Notes to Consolidated Financial Statements.


<PAGE> 28


WASHINGTON MUTUAL FINANCE CORPORATION and Subsidiaries
Notes to Consolidated Financial Statements

Note 1            Ownership and Operations

At June  30,  1997,  Washington  Mutual  Finance  Corporation  was an  indirect,
wholly-owned subsidiary of Great Western Financial Corporation ("GWFC"). On July
1, 1997,  GWFC  merged with and into a  wholly-owned  subsidiary  of  Washington
Mutual, Inc.  ("Washington Mutual") (the "Great Western Merger"). As a result of
this  merger,  the  Company  became  an  indirect,  wholly-owned  subsidiary  of
Washington  Mutual.  The Great Western  Merger was accounted for as a pooling of
interests.  Accordingly,  these financial  statements  reflect  historical cost.
Washington  Mutual Finance  Corporation and its  subsidiaries,  all of which are
wholly-owned,  are referred to hereinafter as the "Company."  Effective March 1,
2000, the Company changed it's name from Aristar, Inc.

The Company is engaged primarily in the consumer financial services business and
its  operations  consist  principally of a network of  approximately  540 branch
offices  located in 25 states,  primarily in the Southeast and Southwest.  These
offices  generally  operate  under the names  Blazer  Financial  Services,  City
Finance Company and First Community  Financial  Services.  Beginning in November
1999 and  continuing  throughout  the first half of 2000,  the office  names are
being  changed to  Washington  Mutual  Finance.  The Company  makes  secured and
unsecured consumer installment loans and purchases retail installment  contracts
from  local  retail  establishments.  These  consumer  credit  transactions  are
primarily for personal,  family or household purposes.  The Company also engages
in the industrial  banking  business  through its  subsidiary,  First  Community
Industrial  Bank ("FCIB"),  which has branches in Colorado and Utah. In addition
to  making  consumer   installment  loans  and  purchasing  retail   installment
contracts, FCIB also takes customers' savings deposits.

Note 2   Summary of Significant Accounting Policies

Principles of Consolidation.  The consolidated  financial statements include the
accounts of Washington Mutual Finance  Corporation and its subsidiaries,  all of
which are  wholly-owned,  after  elimination  of all  intercompany  balances and
transactions.  Certain amounts in prior years have been  reclassified to conform
to the current year's presentation.

Estimates.  The preparation of financial statements in conformity with generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.

Income  Recognition  from Finance  Operations.  Unearned  finance charges on all
types of consumer finance  receivables are recognized on an accrual basis, using
the interest method.  Accrual generally is suspended when payments are more than
three months contractually overdue. Loan fees and directly related lending costs
are deferred and amortized using the interest  method over the contractual  life
of the related  receivables.


<PAGE> 29

Provision and Allowance  for Credit  Losses.  The allowance for credit losses is
maintained at a level sufficient to provide for estimated credit losses based on
evaluating  known  and  inherent  risks  in  the  consumer  finance  receivables
portfolio.  The Company  provides,  through charges to income,  an allowance for
credit losses which,  based upon  management's  evaluation of numerous  factors,
including  economic  conditions,  a  predictive  analysis  of the outcome of the
current portfolio and prior credit loss experience,  is deemed adequate to cover
reasonably  expected losses inherent in outstanding  receivables.  The Company's
consumer finance receivables are a large group of small-balance homogenous loans
that are collectively evaluated for impairment.  Additionally, every real estate
secured  loan that  reaches 60 days  delinquency  is reviewed  by the  Company's
credit  administration  management to assess collectibility and future course of
action.

Losses on receivables  are charged to the allowance for credit losses based upon
the number of days delinquent or when  collectibility  becomes  doubtful and the
underlying  collateral,  if any, is  considered  insufficient  to liquidate  the
receivable  balance.   Non-real  estate  secured,   delinquent  receivables  are
generally  charged  off  when  they  are  180  days  contractually   delinquent.
Recoveries on previously written-off receivables are credited to the allowance.

Investment  Securities.  Debt and equity  securities are classified as available
for sale and are  reported  at fair  value,  with  unrealized  gains and  losses
excluded from earnings and reported,  net of taxes,  as a separate  component of
stockholder's  equity and comprehensive  income.  Gains and losses on investment
securities are recorded when realized on a specific  identity basis.  Investment
security transactions are recorded using trade date accounting.

Property,   Equipment  and  Leasehold  Improvements.   Property,  equipment  and
leasehold  improvements  are stated at cost,  net of  accumulated  depreciation.
Depreciation  is provided for principally on the  straight-line  method over the
estimated useful life, ranging from three to thirty years, or, if less, the term
of the lease.  At  December  31,  1999 and 1998,  accumulated  depreciation  and
amortization totaled $26.3 million and $24.1 million.

Goodwill.  The  excess of cost over the fair  value of net  assets of  companies
acquired is amortized on a straight-line  basis,  generally over periods of 6 to
25 years. The carrying value of goodwill is regularly reviewed for indicators of
impairment  in  value,  which in  management's  view are other  than  temporary,
including  unexpected or adverse  changes in the  following:  1) the economic or
competitive  environments  in  which  the  Company  operates;  2)  profitability
analyses;  and 3) cash flow analyses.  If facts and  circumstances  suggest that
goodwill is  impaired,  the Company  assesses  the fair value of the  underlying
business based on expected  undiscounted  net cash flows and reduces goodwill to
the  estimated  fair  value.   At  December  31,  1999  and  1998,   accumulated
amortization totaled $69.3 million and $65.3 million.

Income Taxes.  The Company is included in the  consolidated  Federal  income tax
return filed by Washington  Mutual.  Federal income taxes are paid to Washington
Mutual.  Federal income taxes are allocated  between  Washington  Mutual and its
subsidiaries in proportion to the respective contribution to consolidated income
or loss. State income tax expense  represents the amount of taxes either owed by
the Company or that the Company would have paid on a separate entity basis, when
the Company is included in  Washington  Mutual's  consolidated  state income tax
returns.  Deferred  income  taxes are  provided on elements of income or expense
that are  recognized  in  different  periods  for  financial  and tax  reporting
purposes.

Taxes on income are  determined  by using the asset and liability  method.  This
approach requires the recognition of deferred tax assets and liabilities for the
expected  future tax  consequences  of events that have been  recognized  in the
Company's  financial  statements  or  tax  returns.  In  estimating  future  tax
consequences, the Company considers expected future events other than enactments
of changes in the tax law or rates.


<PAGE> 30

Statements  of Cash Flows.  For  purposes of reporting  cash flows,  the Company
considers all highly liquid  investments with a maturity of three months or less
when purchased to be cash equivalents.

Fair Value  Disclosures.  Quoted market  prices are used,  where  available,  to
estimate  the fair  value of the  Company's  financial  instruments.  Because no
quoted market prices exist for a significant  portion of the Company's financial
instruments,  fair value is estimated using comparable market prices for similar
instruments or using  management's  estimates of appropriate  discount rates and
cash  flows for the  underlying  asset or  liability.  A change in  management's
assumptions  could  significantly  affect  these  estimates.   Accordingly,  the
Company's fair value estimates are not necessarily indicative of the value which
would be realized upon disposition of the financial instruments.

Recently Issued Accounting  Standard Not Yet Adopted.  SFAS No.133,  "Accounting
for Derivative  Instruments and Hedging Activities," was issued in June 1998 and
establishes  accounting  and  reporting  standards for  derivative  instruments,
including certain derivative  instruments  embedded in other contracts,  and for
hedging activities. The Financial Accounting Standards Board has issued SFAS No.
137, "Accounting for Derivative Instruments and Hedging Activities - Deferral of
the  Effective  Date of SFAS No. 133," which delays the  implementation  date of
SFAS No. 133 for one year, to fiscal years  beginning  after June 15, 2000.  The
Company will  implement  this  statement  on January 1, 2001.  The impact of the
adoption  of the  provisions  of this  statement  on the  Company's  results  of
operations or financial condition has not yet been determined.

Note 3   Transfers from Related Parties

In May 1999,  Washington  Mutual  transferred  to the  Company a portion  of its
consumer finance business,  hereinafter  referred to as Home Consumer Finance of
America  ("HCFA").  HCFA was a division  of H.F.  Ahmanson & Company,  which was
acquired by Washington Mutual in October,  1998. HCFA was comprised primarily of
approximately  $48.5 million in net consumer finance  receivables,  and 6 branch
locations.  The Company paid an amount which  approximated the book value of the
assets acquired.


<PAGE> 31


Note 4            Business Combinations

On October 29, 1999,  the Company  acquired  substantially  all of the assets of
Peoples Security Finance Company, Inc., a subsidiary of CNB Bancshares,  Inc. As
a result,  the Company added  twenty-one  new branches in Kentucky and Tennessee
with net  consumer  finance  receivables  of  approximately  $45  million.  This
acquisition  also provided the Company with an  opportunity to gain market share
in  geographical  areas in which the Company had little  presence and strengthen
its share of other  markets.  The  acquisition  was accounted for as a purchase.
Accordingly,  the assets  acquired were recorded on the Company's books at their
respective  fair values at the time of  acquisition.  Goodwill of  approximately
$6.8 million was recorded, which is being amortized over 10 years.

Note 5            Consumer Finance Receivables

Consumer  finance  receivables  at December 31, 1999 and 1998 are  summarized as
follows:

<TABLE>

(Dollars in thousands)                               1999                 1998
                                            -------------        -------------

Consumer finance receivables:
<S>                                         <C>                  <C>
  Real estate secured loans                 $   1,630,496        $   1,269,439
  Personal loans                                1,566,682            1,361,820
  Retail sales contracts                          327,914              328,254
                                            -------------        -------------

    Gross consumer finance receivables          3,525,092            2,959,513
Less:    Unearned finance charges and

          deferred loan fees                     (463,335)            (385,117)
         Allowance for credit losses             (100,308)             (80,493)
                                            -------------        -------------
Consumer finance receivables, net           $   2,961,449        $   2,493,903
                                            =============        =============

</TABLE>

The amount of gross nonaccruing  consumer finance  receivables was approximately
$59.4  million and $53.4  million at December  31, 1999 and 1998.  The amount of
interest that would have been accrued on these consumer finance  receivables was
approximately $9.5 million and $8.9 million.


<PAGE> 32


Activity in the Company's allowance for credit losses is as follows:

<TABLE>

                                                 Year Ended December 31,
                                   ----------------------------------------------
(Dollars in thousands)                      1999             1998            1997
                                   -------------    -------------   -------------

<S>              <C>               <C>              <C>             <C>
Balance, January 1                 $      80,493    $      74,323   $      70,045
Provision for credit losses              100,590           79,760          66,600
Amounts charged off:
   Real estate secured loans              (1,807)          (2,125)         (1,292)
   Personal loans                        (82,438)         (73,210)        (64,460)
   Retail sales contracts                (12,558)         (14,417)        (13,946)
                                   --------------   -------------   -------------
                                         (96,803)         (89,752)        (79,698)
Recoveries:
   Real estate secured loans                 398              521             556
   Personal loans                         12,629           12,593          11,538
   Retail sales contracts                  3,001            2,774           2,553
                                   -------------    -------------   -------------
                                          16,028           15,888          14,647
                                   -------------    -------------   -------------
Net charge-offs                          (80,775)         (73,864)         65,051)

Allowances on notes purchased             -                   274           2,729
                                   -------------    -------------   -------------
Balance, December 31               $     100,308    $      80,493   $      74,323
                                   =============    =============   =============

</TABLE>

Contractual  maturities,  excluding  unearned  finance charges and deferred loan
fees, at December 31, 1999 are as follows:

<TABLE>

                                                  Over 1 But
                                     Within           Within            Over
(Dollars in thousands)               1 year          5 years          5 years             Total
                                -----------    -------------    -------------    --------------

<S>                             <C>            <C>              <C>              <C>
Real estate secured loans       $   168,498    $     395,885    $     868,458    $    1,432,841
Personal loans                       78,598        1,247,134            8,618         1,334,350
Retail sales contracts               33,679          256,235            4,652           294,566
                                -----------    -------------    -------------    --------------
                                $   280,775    $   1,899,254    $     881,728    $    3,061,757
                                ===========    =============    =============    ==============

</TABLE>

Consumer  loans have maximum terms of 360 months,  while retail sales  contracts
have maximum terms of 60 months.  The weighted  average  contractual term of all
consumer  finance  receivables  written during the years ended December 31, 1999
and 1998 was 71 months and 56 months with the majority of loans  providing for a
fixed rate of interest over the  contractual  life of the loan.  Experience  has
shown that a substantial  portion of the consumer  finance  receivables  will be
renewed  or repaid  prior to  contractual  maturity.  Therefore,  the  preceding
information as to contractual maturities should not be regarded as a forecast of
future cash collections.


<PAGE> 33


Because the Company  primarily lends to consumers,  it did not have  receivables
from any  industry  group that  comprised  10 percent or more of total  consumer
finance receivables at December 31, 1999. Geographic diversification of consumer
finance  receivables  reduces the concentration of credit risk associated with a
recession in any one region.

The largest concentrations of net consumer finance receivables, by state were as
follows:

<TABLE>

(Dollars in thousands)                 December 31,
                   -------------------------------------------------
                             1999                         1998
                   ----------------------        -------------------
                        Amount    Percent          Amount    Percent
                   -----------   --------     ------------  ---------
<S>                <C>                <C>    <C>                   <C>
Colorado           $   309,384         10%    $    228,999         9%
Tennessee              306,499         10          263,923        11
Texas                  293,836         10          341,159        14
North Carolina         257,719          9          223,935         9
California             232,493          8          149,316         6
Florida                229,132          8          104,372         4
Louisiana              134,303          5          121,239         5
South Carolina         162,595          5          142,950         6
Virginia               140,870          5          126,182         5
Mississippi            121,507          4          106,889         4
Other                  773,111         26          684,939        27
                    ----------   --------       ----------  --------

Total              $ 2,961,449        100%    $  2,493,903        100%
                   ===========   ========     ============  ========


</TABLE>


<PAGE> 34


Note 6            Investment Securities

At December 31, 1999 and 1998,  all  investment  securities  were  classified as
available-for-sale  and  reported at fair  value.  Investment  securities  as of
December 31, 1999 and 1998 are as follows:

<TABLE>

(Dollars in thousands)                             December 31, 1999
                              ------------------------------------------------------------
                                                           Gross Unrealized    Approximate
                              Original      Amortized      ----------------           Fair
                                Cost           Cost        Gains    Losses           Value
                              -----------  -----------   ---------  --------    ----------
<S>                           <C>          <C>           <C>      <C>        <C>
Government obligations        $    37,875  $    37,887   $      28  $    629    $   37,286
Corporate obligations              80,392       80,756          96     1,420        79,432
Certificates of deposit
 and other                         12,789       12,452         114       320        12,246
                              -----------  -----------   ---------  --------    ----------
                              $   131,056  $   131,095   $     238  $  2,369    $  128,964
                              ===========  ===========   =========  ========    ==========


 (Dollars in thousands)                            December 31, 1998
                              ------------------------------------------------------------
                                                           Gross Unrealized    Approximate
                                Original    Amortized      ----------------           Fair
                                  Cost        Cost         Gains     Losses          Value
                              -----------  -----------   ---------  --------    ----------
Government obligations        $    18,637  $    18,649   $     183  $     42    $   18,790
Corporate obligations              95,813       96,075       1,739        93        97,721
Certificates of deposit
 and other                         34,489       34,028         443       162        34,309
                              -----------  -----------   ---------  --------    ----------
                              $   148,939  $   148,752   $   2,365  $    297    $  150,820
                              ===========  ===========   =========  ========    ==========

</TABLE>

There were no significant realized gains or losses during 1999, 1998 or 1997.

The  following  table  presents the  maturity of the  investment  securities  at
December 31, 1999:

<TABLE>

(Dollars in thousands)                                         Approximate
                                             Amortized            Fair
                                               Cost               Value
                                            ------------      --------------
<S>                                         <C>               <C>
Due in one year or less                     $     23,257      $      23,210
Due after one year through five years             75,104             73,271
Due after five years through ten years            29,784             29,533
Due after ten years                                2,950              2,950
                                            ------------      -------------
                                            $    131,095      $     128,964
                                            ============      =============

</TABLE>


<PAGE> 35

Note 7            Short-term Debt

Short-term debt at December 31, 1999 and 1998 consisted  primarily of commercial
paper.  Interest  expense in 1999 and 1998 related to commercial paper was $18.5
million and $20.6 million.

In addition,  during the year, the Company maintained short-term borrowings from
the Federal Home Loan Bank of Topeka  ("FHLB").  As of December  31,  1999,  two
short-term fixed advances were outstanding,  one in the amount of $31.5 million,
maturing  January 24, 2000, with an interest rate of 5.89%.  The other borrowing
was $10.5 million,  maturing March 2, 2000, with a fixed interest rate of 5.96%.
Interest  expense in 1999,  1998 and 1997 related to short-term  FHLB borrowings
was $1.4  million,  $26  thousand,  and $0.  FHLB  borrowings  (both  short  and
long-term)  are secured by  residential  mortgage loans with a carrying value at
December 31, 1999 of $178.3 million.

Additional information concerning total short-term borrowings is as follows:

<TABLE>

                                                      Year Ended December 31,
                                         ----------------------------------------------------
(Dollars in thousands)                        1999               1998                1997
                                         -------------    ---------------      --------------

Outstanding during the year
<S>                                      <C>              <C>                    <C>
   Maximum amount at any month end       $     472,945    $       560,823        $    471,980
   Average amount                        $     346,785    $       372,317        $    406,992
   Weighted average interest rate                  5.3%               5.5%                5.8%

Balance at end of year
   Amount                                $     284,175    $       560,823        $    357,532
   Weighted average interest rate                  6.2%               5.7%                6.1%

</TABLE>

Weighted average interest rates include the effect of commitment fees.

Short-term  notes totaling $116 million and $74 million were issued in December,
1999 and 1998.  The  proceeds of these  notes were used to  purchase  investment
securities and were repaid through  liquidation of these securities in the month
following  issuance.  This  short-term  debt  has  been  reflected  net  of  the
securities  balances in the  accompanying  Consolidated  Statements of Financial
Condition.

In August 1999,  the Company and  Washington  Mutual  entered into two revolving
credit agreements with the Chase Manhattan Bank as administrative  agent: a $600
million 364-day facility and a $600 million four-year facility,  each to be used
for  general  corporate  purposes,  including  back-up  for  the  Company's  and
Washington Mutual's commercial paper programs. The Company may borrow a total of
$1.2 billion under these facilities, and Washington Mutual may borrow a total of
$500 million  under these  facilities.  These credit  agreements  replace a $550
million  revolving  credit line which was  previously  available.  There were no
borrowings  under  these  revolving  credit  agreements  in 1999 or 1998.  These
revolving credit agreements have restrictive  covenants which include: a minimum
consolidated net worth test; a limit on senior debt to the borrowing base (up to
10:1); and subsidiary debt (excluding bank deposits and  intercompany  debt) may
not exceed 15% of total  debt.  As of  December  31,  1999,  the  Company was in
compliance with all restrictive covenants.


<PAGE> 36


Note 8            Long-term Debt

Long-term debt at December 31, 1999 and 1998 was comprised of the following:

<TABLE>

(Dollars in thousands)                                         1999           1998
                                                       ------------    -----------

Senior notes and debentures (unsecured)
<S>                     <C> <C>                        <C>             <C>
   7.875%, due February 15, 1999                       $     -         $     99,995
   6.75%, due May 15, 1999                                   -               99,998
   6.3%, due July 15, 2000                                   99,988          99,968
   6.125%, due December 1, 2000                             149,901         149,800
   7.75%, due June 15, 2001                                 149,975         149,959
   7.25%, due June 15, 2001                                  99,949          99,916
   6.0%, due August 1, 2001                                 199,812         199,697
   6.75%, due August 15, 2001                                99,968          99,950
   6.0%, due May 15, 2002                                   149,744          -
   6.30%, due October 1, 2002                               149,733         149,644
   6.50%, due November 15, 2003                             149,526         149,415
   5.85%, due January 27, 2004                              199,754          -
   7.375%, due September 1, 2004                            298,935          -
   7.25%, due June 15, 2006                                 248,603          -
                                                       ------------    ------------

     Total senior debt                                    1,995,888       1,298,342
                                                       ------------    ------------

Senior subordinated notes and debentures (unsecured)
   7.5%, due July 1, 1999                                    -               99,925
                                                       ------------    ------------

Federal Home Loan Bank notes (secured)
   6.08%, due March 29, 2001                                 60,000          -
   5.50%, due May 1, 2001                                     3,900          18,900
   5.92%, due March 20, 2003                                 10,000          10,000
                                                       ------------    ------------

     Total Federal Home Loan Bank notes                      73,900          28,900
                                                       ------------    ------------

     Total long-term debt                              $  2,069,788    $  1,427,167
                                                       ============    ============
</TABLE>


<PAGE> 37


Aggregate maturities of long-term debt at December 31, 1999 are as follows:

<TABLE>

(Dollars in thousands)                   Federal
                          Senior        Home Loan
                           Debt         Bank Notes       Total
                       ------------    ------------  ------------
<S>                    <C>             <C>           <C>
2000                   $    249,889    $       -     $    249,889
2001                        549,704          63,900       613,604
2002                        299,477            -          299,477
2003                        149,526          10,000       159,526
2004                        498,689            -          498,689
2005 and thereafter         248,603            -          248,603
                       ------------    ------------  ------------
                       $  1,995,888    $     73,900  $  2,069,788
                       ============    ============  ============

</TABLE>

Interest expense related to senior notes  outstanding in 1999, 1998 and 1997 was
$115.5 million, $100.9 million, and $95.6 million.

On May 1, 1997, the Company obtained an adjustable rate advance from the FHLB in
the amount of $21.5 million.  Under the credit  agreement,  which matures May 1,
2001,  interest is payable  monthly and adjusts every seven days to a rate equal
to the FHLB's One Week Repo rate plus 10 basis  points  (5.50% at  December  31,
1999). As a result of prepayments made in 1998 and 1999, the outstanding balance
as of December 31, 1999 was $3.9 million.

On March 20, 1998, the Company  obtained an adjustable  advance from the FHLB in
the amount of $10 million.  On a specified  day each  quarter,  the FHLB has the
option to call the advance at par.  Under the credit  agreement,  which  matures
March 20, 2003,  interest is payable monthly and adjusts monthly to a rate equal
to the FHLB's One-Month Short-Term Advance Rate (5.68% at December 31, 1999).

On March 26, 1999, the Company obtained an adjustable rate advance from the FHLB
in the amount of $60 million.  Under the credit  agreement,  which matures March
29, 2001,  interest is payable monthly and adjusts every quarter to a rate equal
to the 3 month LIBOR rate less 10 basis points (6.08% at December 31, 1999).

Interest  expense related to long-term FHLB debt in 1999, 1998 and 1997 was $3.4
million, $1.7 million, and $1.1 million.


<PAGE> 38


Note 9            Customer Deposits

The book value of the  Company's  customer  deposits as of December 31, 1999 and
1998 are as follows:

<TABLE>

(Dollars in thousands)               1999       1998
                                ---------   ----------

<S>                             <C>         <C>
Money market accounts           $  13,576   $   15,382
Savings accounts                    1,434        1,340
Certificates of deposit
  under $100,000                  153,524      155,287
Certificates of deposit
  $100,000 and over                21,400       15,509
                               ----------   ----------
                               $  189,934   $  187,518
                               ==========   ==========

</TABLE>

Maturities of time deposits are $129.2  million in 2000,  $35.1 million in 2001,
$3.6 million in 2002 and $7.0 million thereafter.

Note 10           Income Taxes

The components of income tax expense (benefit) are as follows:
<TABLE>


                                           Year Ended December 31,
                              ------------------------------------------------
(Dollars in thousands)                1999               1998             1997
                              ------------       ------------       ----------

Current

<S>                          <C>                <C>                 <C>
   Federal                   $      35,896      $      38,808       $   28,567
   State                             8,032              6,900            5,237
Deferred                             1,792            (11,008)          (4,060)
                             -------------      -------------       ----------
                             $      45,720      $      34,700       $   29,744
                             =============      =============       ==========

</TABLE>

The  provisions  for  income  taxes  differ  from  the  amounts   determined  by
multiplying  pre-tax income by the statutory  Federal income tax rate of 35% for
1999, 1998 and 1997. A reconciliation between these amounts is as follows:
<TABLE>

                                                          Year Ended December 31,
                                      ---------------------------------------------------------------------------
(Dollars in thousands)                           1999                     1998                      1997
                                      ----------------------    ----------------------    ----------------------
                                                        % of                      % of                      % of
                                                      Pretax                    Pretax                    Pretax
                                         Amount       Income       Amount       Income       Amount       Income
                                      ---------    ---------    ---------    ---------    ---------     --------
<S>                                   <C>               <C>     <C>               <C>      <C>               <C>
Income taxes at statutory rates       $  41,549         35.00%  $  30,655        35.00%   $  26,611        35.00%
Increase (reduction) in taxes
   resulting from:
    State income taxes, net of
     Federal benefit                      4,172         3.52        4,025         4.60        2,972         3.91
    Other                                   (1)         (.01)          20          .01          161          .21
                                      ---------    ----------   ---------    ---------     --------     --------
                                      $  45,720         38.51%  $  34,700        39.61%   $  29,744        39.12%
                                      =========    ==========   =========    =========    =========     ========

</TABLE>


<PAGE> 39

Deferred taxes result from temporary  differences in the  recognition of certain
items for tax and financial  reporting purposes.  The significant  components of
the Company's net deferred tax asset (liability) were as follows:

<TABLE>

                                                        December 31,
                                                 ----------------------------
(Dollars in thousands)                                  1999             1998
                                                 -----------     ------------

Deferred tax assets:
<S>                                              <C>             <C>
   Credit loss reserves                          $    40,970     $     31,564
   Employee benefits accruals                          5,892              577
   Unearned insurance commissions                      4,678            7,466
   Basis differences on premises and equipment           170               81
   State taxes                                          -               2,543
   Other                                               2,616            8,669
                                                 -----------     ------------
     Total deferred tax assets                        54,326           50,900
                                                 -----------     ------------

Deferred tax liabilities:
   Amortization of intangibles                   $   (10,877)    $    (11,614)
   State taxes                                        (2,439)            -
   Loan interest and fee income                       (3,471)            (511)
   Other                                                (674)          (1,652)
                                                 -----------     ------------
     Total deferred tax liabilities                  (17,461)         (13,777)
                                                 -----------     ------------
Net deferred tax asset                           $    36,865     $     37,123
                                                 ===========     ============

</TABLE>


<PAGE> 40

Note 11           Retirement and Savings Plans

Substantially  all of the Company's  employees  participate in a noncontributory
defined  contribution pension plan maintained by Washington Mutual ("the Plan").
Accumulated plan benefits and annual pension cost are derived from an allocation
formula  based  on  the  Company's  total  participants  and  the  Plan's  total
participants.

Pension  cost  (benefit)  for the  Company's  participants  for the years  ended
December 31, 1999, 1998, and 1997 was $1,074,000, $(150,000) and $(150,000). Due
to  the  Company's  participation  in a  multi-employer  defined  benefit  plan,
information as to separate Company participant assets and vested benefits is not
presented.

The Company's  employees also participate in an employee savings plan maintained
by  Washington  Mutual,  which allows  employees to defer part of their  pre-tax
compensation  until  retirement.   Company   contributions   equal  50%  of  the
contributions  made by  employees  up to 6% of salary plus annual  discretionary
amounts, if any, as determined by management. The Company's cost is based on the
actual contribution  related to its participating  employees.  Total expense was
approximately  $3.0  million,  $2.5 million and $1.0 million for the years ended
December 31, 1999, 1998 and 1997.


The Company's  employees who retired prior to July 1, 1997 also  participate  in
GWFC's defined benefit  postretirement  plan ("the Benefit Plan") which covers a
portion  of the  costs  of  medical  and life  insurance  coverage  to  eligible
employees and dependents  based on age and length of service.  Medical  coverage
options  are  the  same  as  available  to  active  employees.  The  accumulated
postretirement  benefit  obligation  and related  expense  are  derived  from an
allocation  formula based on the Company's  total  participants  and the Benefit
Plan's total participants.

The net  postretirement  medical and life  insurance  expense  allocated  to the
Company for the years ended December 31, 1999,  1998 and 1997 was  approximately
$245,000, $344,000 and $358,000.

Note 12           Leases

The Company leases office space,  computers,  office  equipment and automobiles,
generally for terms of five or fewer years.

The Company has no material  capital leases.  Under  operating  leases that have
initial  or  remaining   noncancelable  lease  terms  in  excess  of  one  year,
approximate  aggregate  annual  minimum  rentals are $8.8 million in 2000;  $6.8
million in 2001; $5.2 million in 2002; $3.3 million in 2003; and $1.7 million in
2004.  Rent expense for the years ended  December  31,  1999,  1998 and 1997 was
$11.9

Note 13           Contingencies

The Company and certain of its  subsidiaries are parties to various lawsuits and
proceedings  arising in the ordinary  course of  business.  The Company has also
been named as a defendant in a number of class action  suits,  in which  various
industry-wide  practices  arising from  routine  business  activities  are being
challenged and various  damages are being sought.  Certain of these lawsuits and
proceedings arise in jurisdictions, such as Alabama and Mississippi, that permit
damage awards  disproportionate  to the actual economic damages incurred.  Based
upon  information  presently  available,  the  Company  believes  that the total
amounts that will  ultimately be paid, if any,  arising from these  lawsuits and
proceedings   will  not  have  a  material   adverse  effect  on  the  Company's
consolidated results of operations and financial position. However, it should be
noted that the frequency of large damage awards, including large punitive damage
awards,  that bear little or no relation to actual economic  damages incurred by
plaintiffs in jurisdictions  like Alabama and Mississippi  continues to increase
and creates the potential for an unpredictable judgment in any given suit.


<PAGE> 41


Note 14           Transactions with Related Parties

Significant  transactions with Washington Mutual or its subsidiaries in addition
to those described in Note 3 are identified as follows:

o    Washington  Mutual  Bank  FA,  another  subsidiary  of  Washington  Mutual,
     provided the Company with certain administrative services,  including human
     resources and cash  management,  for which the Company paid management fees
     of $1.7 million in 1999, $1.1 million in 1998 and $1.9 million in 1997.

o    The Company made payments to Washington Mutual pursuant to a tax allocation
     policy and in connection with the retirement and savings plans.

o    Included  in  accounts  payable  and other  liabilities  are amounts due to
     Washington  Mutual.  At December 31, 1999 and 1998,  these amounts  totaled
     $35.8 million and $6.7 million.

Note 15   Lines of Business

The Company is managed along two major lines of business:  consumer  finance and
consumer banking.  The Company provides  information on the performance of these
business segments which are strategic lines of business managed by the Executive
Committee  under the  direction of the Chief  Executive  Officer.  The financial
performance of these  business lines is measured by the Company's  profitability
reporting processes.

The Company's  business  segments are managed  through its Executive  Committee,
which  is the  senior  decision  making  group  of the  Company.  The  Executive
Committee  is  comprised  of eleven  members  including  the  Chairman and Chief
Executive Officer, the President and Vice Presidents who manage key business and
operational areas within the Company.

Both segments are managed by an executive  team that is  responsible  for sales,
marketing, sales support,  operations and certain administrative functions. Back
office support is provided to each segment  through  executives  responsible for
lending administration, information systems, finance, legal, marketing and human
resources.

Operating  revenues and expenses are directly  assigned to business  segments in
determining  their operating  income.  The financial results of each segment are
derived from the Company's general ledger systems. Certain adjustments have been
made to recorded  general ledger  accounts to  appropriately  reflect results of
operations and financial position transfers among segments.

The organizational structure of the institution and the allocation methodologies
it employs  result in business line financial  results that are not  necessarily
comparable  across companies.  As such, the Company's  business line performance
may not be directly  comparable  with similar  information  from other  consumer
finance companies.


<PAGE> 42


Financial highlights by lines of business were as follows:

<TABLE>

(Dollars in thousands)                                             Year Ended December 31,
                              ------------------------------------------------------------------------------------------------
                                           1999                            1998                             1997
                              --------------------------------  -----------------------------    -----------------------------
                               Consumer   Consumer              Consumer   Consumer              Consumer   Consumer
                               Finance    Banking      Total    Finance    Banking      Total    Finance    Banking   Total
                              ----------  --------  ----------  ---------  --------   --------  ---------  --------  ---------

Condensed income statement:
Net interest income after
<S>                           <C>         <C>       <C>         <C>        <C>       <C>        <C>        <C>      <C>
   provision for loan losses  $  207,160  $ 17,645  $  224,805  $ 188,051  $ 15,381  $ 203,432  $ 165,702  $ 14,903  $ 180,605
Other operating income            29,032       469      29,501     26,380       767     27,147     26,063       492     26,555
Operating expenses               128,049     7,545     135,594    136,275     6,717    142,992    124,554     6,575    131,129
                              ----------  --------  ----------  ---------  --------  ---------  ---------  --------  ---------

Income before income
   taxes                         108,143    10,569     118,712     78,156     9,431     87,587     67,211     8,820     76,031
Income taxes                      41,678     4,042      45,720     31,092     3,608     34,700     26,370     3,374     29,744
                              ----------  --------  ----------  ---------  --------  ---------  ---------  --------  ---------

Net income                    $   66,465  $  6,527  $   72,992  $  47,064  $  5,823  $  52,887  $  40,841  $  5,446  $  46,287
                              ==========  ========  ==========  =========  ========  =========  =========  ========  =========

</TABLE>

Other disclosures:

<TABLE>

                                              December 31,
                    -----------------------------------------------------------------
                                1999                               1998
                    -------------------------------   -------------------------------
                       Consumer Consumer              Consumer   Consumer
                       Finance   Banking      Total    Finance    Banking       Total
                    ---------- ---------  ---------- ---------- ---------  ----------
<S>                 <C>        <C>        <C>        <C>        <C>        <C>
Total assets        $2,821,116 $ 406,441  $3,227,557 $2,415,476 $ 329,234  $2,744,710

Total equity        $ 422,650  $  52,508  $ 475,158  $ 373,190  $  46,140  $  419,330

</TABLE>

Note 16     Approximate Fair Values of Financial Instruments

A summary of the approximate fair values of the Company's financial instruments,
as compared to their carrying values, is set forth in the following table:

<TABLE>

(Dollars in thousands)
                                    December 31, 1999          December 31, 1998
                             --------------------------    ------------------------
                                 Carrying   Approximate      Carrying   Approximate
                                    Value    Fair Value         Value    Fair Value
                             ------------  ------------    -----------  -----------
<S>                          <C>           <C>             <C>          <C>
Consumer finance receivables $  3,061,757  $  3,053,585    $ 2,574,396  $ 2,530,486
Investment securities             128,964       128,964        150,820      150,820
Short-term debt                   284,175       284,175        560,823      560,823
Long-term debt                  2,069,788     2,043,693      1,427,167    1,451,704
Customer deposits                 189,934       187,499        187,518      189,717

</TABLE>


<PAGE> 43


The following methods and assumptions were used by the Company in estimating its
fair value disclosures for financial instruments:

         Consumer  finance  receivables.  The approximate fair value of consumer
         finance  receivables is estimated by discounting  the future cash flows
         using  current  rates at which similar loans would be made with similar
         maturities to borrowers with similar credit ratings.  The fair value is
         not adjusted for the value of potential  loan  renewals  from  existing
         borrowers.

         Investment securities.  Fair values for investment securities are based
         on quoted market prices,  where available.  If quoted market prices are
         not  available,  fair  values  are  based on  quoted  market  prices of
         comparable instruments.

         Cash  and  cash  equivalents.  The  carrying  amount  reported  in  the
         statement  of  financial   condition  for  cash  and  cash  equivalents
         approximates its fair value given its highly liquid nature.

         Debt.  The  carrying  amount  reported in the  statement  of  financial
         condition for  short-term  debt  approximates  its fair value given its
         brief maximum term.  The  approximate  fair value for long-term debt is
         estimated using rates currently  available to the Company for debt with
         similar terms and remaining maturities.

         Customer  deposits.  The fair values  disclosed for fixed-rate  savings
         certificates  of deposit are  estimated  using a  discounted  cash flow
         calculation  that applies  interest  rates  currently  being offered on
         certificates  to a schedule of aggregate  expected  maturities  on time
         deposits.  The fair  values  disclosed  for  savings  and money  market
         accounts are, by  definition,  equal to the amount payable on demand at
         the reporting date.

         Accounts payable and other liabilities. The carrying amount reported in
         the  statement of financial  condition  for accounts  payable and other
         liabilities  approximates its fair value given its settlement on demand
         nature.


<PAGE> 44


Note 17       Selected Quarterly Financial Data (Unaudited)

A summary of the quarterly  results of operations  for the years ended  December
31, 1999 and 1998 is set forth below:

<TABLE>
                                                         As of and for the Quarter Ended
                              ----------------------------------------------------------------------------------------------
                                     March 31,                June 30,           September 30,          December 31,
                              ----------------------  ----------------------  ----------------------  ----------------------
(Dollars in thousands)           1999        1998       1999         1998        1999        1998        1999        1998
                              ----------  ----------  ----------  ----------  ----------  ----------  ----------  ----------

Net interest income before
<S>                           <C>         <C>         <C>         <C>         <C>         <C>         <C>         <C>
 Provision for credit losses  $   78,388  $   66,907  $   80,494  $   67,957  $   81,429  $   71,791  $   85,084  $   76,537
                              ----------  ----------  ----------  ----------  ----------  ----------  ----------  ----------

Provision for credit losses       25,600      18,000      26,040      18,300      25,100      21,800      23,850      21,660
Other operating income             6,655       6,489       6,868       5,777       7,415       7,844       8,563       7,037
Other operating expenses          33,712      32,941      32,065      32,026      32,618      32,456      33,239      41,952
Goodwill amortization
 Expense                             935       1,019         971         866         970         866       1,084         866
                              ----------  ----------  ----------  ----------  ----------  ----------  ----------   ---------

Income before income taxes        24,796      21,436      28,286      22,542      30,156      24,513      35,474      19,096

Income tax provision               9,670       8,500      11,030       8,900      11,760       9,700      13,260       7,600
                              ----------  ----------  ----------  ---------   ----------  ---------   ----------   ---------

Net income                    $   15,126  $   12,936  $   17,256  $   13,642  $   18,396  $   14,813  $   22,214  $   11,496
                              ==========  ==========  ==========  ==========  ==========  ==========  ==========  ==========

Consumer finance
 Receivables, net             $2,539,015  $2,215,439  $2,648,241  $2,242,928  $2,792,908  $2,353,441  $2,961,449  $2,493,903
                              ==========  ==========  ==========  ==========  ==========  ==========  ==========  ==========

</TABLE>

Item  9.  Changes  in and  Disagreements  with  Accountants  on  Accounting  and
Financial Disclosure.

None.



<PAGE> 45



                                     PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K.

(a)  Index of Documents filed as a part of this Report:

  1.    Financial Statements

        Included in Part II of this Report:

                                                                           PAGE

        Report of Independent Certified Public Accountants...................24

        Washington Mutual Finance Corporation and Subsidiaries:
          Consolidated Statements of Financial Condition
           at December 31, 1999 and 1998.....................................25
          Consolidated Statements of Operations, Comprehensive Income
           and Retained Earnings for the Years Ended December 31, 1999,
           1998 and 1997.....................................................26
          Consolidated Statements of Cash Flows
           for the Years Ended December 31, 1999, 1998 and 1997..............27
          Notes to Consolidated Financial Statements.........................28

  2.    Financial Statement Schedules

        All schedules are omitted because of the absence of the conditions
        under which they are required or because the required  information
        is set forth in the financial statements or related notes.

  3.    Exhibits

        Included in Part IV of this Report:

     Exhibit Number

      (2)    (a)  Agreement   dated  as  of  April  30,  1996,   between   Great
                  Western Bank and First  Community Financial Services, Inc. (i)
             (b)  Amendment to Exhibit (2) (a) dated as of August 31, 1996. (ii)
             (c)  Agreement  dated as of April 30, 1996,  between Great  Western
                  Bank and Blazer  Financial Services, Inc. (i)
             (d)  Amendment to Exhibit (2) (c) dated as of August 31, 1996. (ii)
             (e)  Agreement  dated  as  of  April   30,   1996,  between   Great
                  Western   Bank  and   Blazer   Financial  Services,  Inc.   of
                  Florida. (i)

<PAGE> 46
             (f)  Amendment to Exhibit (2) (e) dated as of August 31, 1996. (ii)
             (g)  Agreement  dated  as  of   December  31, 1996,  between  Great
                  Western  Financial  Corporation  and Aristar, Inc. (iii)
      (3)    (a)  Certificate  of  Incorporation  of  Washington  Mutual Finance
                  Corporation as presently in effect.  (iv)
             (b)  By-Laws of Washington Mutual Finance Corporation as  presently
                  in effect.  (iv)
      (4)    (a)  Indenture dated as of July 1, 1992 between  Aristar,  Inc. and
                  The Chase Manhattan Bank, N.A., as trustee. (v)
             (b)  Indenture dated as of July 1, 1995 between  Aristar, Inc.  and
                  The Bank of New York, as trustee. (vi)
             (c)  Indenture  dated as of October 1, 1997 between  Aristar,  Inc.
                  and First Union  National Bank, as trustee. (vii)
             (d)  Indenture dated as of November 15, 1997 between  Aristar, Inc.
                  and First Union National Bank, as trustee. (vii)
             (e)  Indenture dated as of June 23, 1999 between  Aristar, Inc. and
                  Harris Trust and Savings Bank, as trustee.(viii)
             (f)  The registrant   hereby  agrees  to furnish the Securities and
                  Exchange   Commission  upon   request   with   copies  of  all
                  instruments  defining  rights of holders of  long-term debt of
                  Washington  Mutual  Finance  Corporation  and its consolidated
                  subsidiaries.
     (10)    (a)  Income  Tax  Allocation  Agreement  between  Aristar, Inc. and
                  Washington  Mutual, as successor  to  Great  Western Financial
                  Corporation (as amended effective August 31, 1999). (ix)
             (b)  364-Day Credit  Agreement by  and among Washington  Mutual and
                  Aristar,  Inc. and The Chase Manhattan Bank, as Administrative
                  Agent. (x)
             (c)  Four-Year  Credit  Agreement  by and  among  Washington Mutual
                  and   Aristar,   Inc.  and  The  Chase  Manhattan   Bank,   as
                  Administrative Agent. (x)
     (12)         Statement Re: Computation of Ratios.
     (23)         Consent of Deloitte & Touche LLP.
     (24)         Power of Attorney included on Page 48 of the Form 10-K.
     (27)         Financial Data Schedule.


<PAGE> 47


                (i)   Incorporated by reference to Registrant's Quarterly Report
                      on Form  10-Q  for  the  quarter  ended  March  31,  1996,
                      Commission file number 1-3521.
                (ii)  Incorporated by reference to Registrant's Quarterly Report
                      on Form 10-Q for the quarter  ended  September  30,  1996,
                      Commission file number 1-3521.
                (iii) Incorporated by reference to  Registrant's  Current Report
                      on Form 8-K  dated  December  31,  1996,  Commission  file
                      number 1-3521.
                (iv)  Incorporated by reference to Registrant's Annual Report on
                      Form 10-K for the year ended December 31, 1987, Commission
                      file number 1-3521.
                (v)   Incorporated by reference to  Registrant's  Current Report
                      on Form 8-K dated June 24,  1992,  Commission  file number
                      1-3521.
                (vi)  Incorporated by reference to Registrant's Quarterly Report
                      on  Form  10-Q  for  the  quarter  ended  June  30,  1995,
                      Commission file number 1-3521.
                (vii) Incorporated by reference to  Registrant's  Current Report
                      on Form 8-K dated October 6, 1997,  Commission file number
                      1-3521.
                (viii)Incorporated by reference to  Registrant's  Report on Form
                      424B2  dated  November  6, 1997,  Commission  file  number
                      1-3521.
                (ix)  Incorporated  by reference  to  Washington  Mutual, Inc.'s
                      Annual Report on Form 10-K for the year ended December 31,
                      1999, Commission file number 1-14667.
                (x)   Incorporated  by reference  to  Washington  Mutual, Inc.'s
                      Quarterly  Report on Form 10-Q for the quarter ended
                      September 30, 1999, Commission File No. 1-14667.

         (b)      Reports on Form 8-K

                  No reports on Form 8-K were filed  during  the period  covered
                  by this Report.


<PAGE> 48



                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  Registrant  has duly  caused  this report to be signed on its
behalf by the undersigned thereunto duly authorized.

WASHINGTON MUTUAL FINANCE CORPORATION

By    /s/ H. Philip Goodeve                              March 30, 2000
----------------------------------------                 ----------------------
H. Philip Goodeve, Senior Vice President                 Date
and Chief Financial Officer
(Principal Accounting Officer)

                                      POWER OF ATTORNEY

Each person whose signature appears below hereby authorizes H. Philip Goodeve as
attorney-in-fact  to sign on his behalf as an individual  and in every  capacity
stated below, and to file all amendments to the registrant's  Form 10-K, and the
registrant hereby confers like authority to sign and file in its behalf.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following  persons on behalf of the  registrant and
in the capacities indicated on March 30, 2000.

/s/ Craig J. Chapman
----------------------------------------
Craig J. Chapman, President and Director
(Principal Executive Officer)


/s/ Craig E. Tall
----------------------------------------
Craig E. Tall, Director


/s/ Fay L. Chapman
----------------------------------------
Fay L. Chapman, Director


/s/ James B. Fitzgerald
----------------------------------------
James B. Fitzgerald, Director


/s/ William A. Longbrake
----------------------------------------
William A. Longbrake, Director