Index First American Profile Financial Highlights Letter to Stockholders First American's Strength in Numbers Title Information and Services Real Estate Information and Services Consumer Information and Services Management's Discussion and Analysis Selected Financial Data Common Stock Prices and Dividends Quarterly Financial Data Consolidated Balance Sheets Consolidated Statements of Income Consolidated Statements of Stockholders' Equity Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements Report of Independent Accountants Officers Board of Directors Primary Companies Stockholder Information Back Cover

consumer information and services (cont.)


First American Home Buyers Protection Corporation remained a leading provider of home warranties that protect homeowners from the cost of repair or replacement of major operating systems and appliances.

The company wrote 9 percent more in premiums last year than in 2000. Renewals, which are not dependent on real estate markets, provided a steady 40 percent of the company’s business. The companyestablished business in 6 additional states last year, bringing its total to 19. And, it made its second call center fully operational, providing the infrastructure to handle forecasted growth.

First American Property & Casualty Insurance Company, which offers complete homeowner’s coverage, had a transition year as it shifted from lender-placed to consumer-directed insurance products. This company provides a long-term and less-cyclical stream of business for First American. To build the business further, the company last year integrated its services into First American distribution channels, allowing for the cross selling of this insurance through existing closing-service activities. It also acquired rights to offer renewals on a $38 million homeowner book of business in 2001. The company, which earned an “A” rating from the recognized rating service A.M. Best Company, also expanded its services into three new states last year.

First American Trust, FSB, a federal savings bank, realized its highest pretax profits in its more than four-decade history. The company markets investment advisory and fiduciary services to corporations, individuals, and nonprofit organizations. New business, spurred by sales and marketing efforts initiated a year earlier, rose 40 percent over the previous year. First American Trust expanded its banking services relationship with First American Title Insurance Company in 2001 and expects to begin administering The First American Corporation’s Dividend Reinvestment and Direct Purchase Plan in the second quarter of 2002. First American Trust opened an office in San Francisco during 2001 to expand its business into Northern California.

First American Capital Management, an SECregistered investment management firm that manages equity and fixed-income securities, reported that its equity portfolios beat its benchmark, the Standard & Poor’s 500, for the sixth consecutive year—one of the few largecapitalization core investment managers to accomplish this. In an effort to expand its market reach, the company recently added institutional salespeople who are offering First American Capital Management products to consultants and plan sponsors unaffiliated with First American.

First Security Thrift increased its earnings last year, as it has for more than a decade. This California-based F.D.I.C.-insured industrial bank accepts deposits, originates and purchases loans secured by commercial properties, and makes loans to complete tax-deferred real estate exchanges. The company increased its net receivables by 10 percent in 2001 and ended the year without a single delinquent account. It has earned a five-star rating, the highest given, from Bauer Financial Reports each quarter for nearly nine consecutive years.