Capital One 2009 Annual Report Download - page 79

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As part of the purchase accounting adjustments related to the Chevy Chase Bank acquisition, the Company recorded net expected
principal losses of $2.2 billion related to the acquired loan portfolio. Since the acquisition date, $371.3 million of losses have been
applied to the expected principal losses, as follows:
(Dollars in thousands)
Balance at
January 1,
2009 Additions Less: losses on
acquired loans
Balance at
December 31,
2009
Option adjustable rate mortgages ............................................................. $ — $ 1,375,000 $ 238,349 $ 1,136,651
Hybrid adjustable rate mortgages ............................................................ — 485,924 — 485,924
Construction to permanent loans .............................................................. — 100,767 25,470 75,297
Home equity lines of credit and fixed mortgages .................................... — 164,095 83,464 80,631
Total included in mortgages ........................................................... $ — $ 2,125,786 $ 347,283 $ 1,778,503
Automobile .............................................................................................. — 15,469 6,145 9,324
Other retail ............................................................................................... — 1,531 — 1,531
Total included in Consumer Banking ................................... — 2,142,786 353,428 1,789,358
Commercial loans .................................................................................... — 64,358 17,899 46,459
Total included in loans held for investment ............................................. $ — $ 2,207,144 $ 371,327 $ 1,835,817
The acquired loans continue to accrue interest under the accretable yield method specified in ASC 805-10/SFAS 141(R) and ASC
310-1-/SOP 03-3 and considered performing unless they perform different than our initial expectation at acquisition. Since the
acquisition date, the Company has recorded $293.2 million of interest income related to the acquired loan portfolio.
Deposits
As of December 31, 2009, the Company had $115.8 billion of deposits compared to $108.6 billion at December 31, 2008. The
increase in deposits is due to the acquisition of Chevy Chase Bank, which added $13.6 billion in deposits during the first quarter of
2009. Without the addition of Chevy Chase Bank, overall deposit volumes would declined $6.4 billion during the year as the
Company managed down the overall level of brokered and time deposits in favor of more branch and commercial customer deposits.
Table 20: Deposits
As of December 31,
(Dollars in thousands) 2009 2008
N
on-interest bearing..........................................................................................................................
.
$ 13,438,659 $ 11,293,852
N
OW accounts ..................................................................................................................................
.
12,077,480 10,522,219
Savings accounts ...............................................................................................................................
.
17,019,187 7,119,510
Money market deposit accounts ........................................................................................................
.
38,094,228 29,171,168
Other consumer time deposits ...........................................................................................................
.
25,455,636 36,509,357
Total core deposits...................................................................................................................
.
$ 106,085,190 $ 94,616,106
Public fund certificates of deposit $100,000 or more .......................................................................
.
578,536 1,174,294
Certificates of deposit $100,000 or more ..........................................................................................
.
8,248,008 10,084,750
Foreign time deposits ........................................................................................................................
.
897,362 2,745,639
Total company deposits ...........................................................................................................
.
$ 115,809,096 $ 108,620,789
Senior and Subordinated Notes and Other Borrowings
At December 31, 2009, the Company had $9.0 billion of senior and subordinated notes and $12.0 billion in other borrowings,
compared to $8.3 billion of senior and subordinated notes and $14.9 billion of other borrowings at December 31, 2008. During 2009,
the Company issued $2.5 billion of senior and subordinated notes and $ 2.0 billion of other borrowings. See “Note 11 – Deposits and
Borrowings” for further details.
Discontinued Operations — GreenPoint Mortgage Loan Origination Operations
The Company acquired GreenPoint in December 2006 as part of the North Fork acquisition. Prior to ceasing residential mortgage loan
origination operations in the third quarter of 2007, GreenPoint originated primarily residential mortgage loans and sold them to
various purchasers. Most of these mortgage loans were resold to securitization trusts and others. In connection with its sales,
GreenPoint entered into agreements containing representations and warranties about, among other things, the mortgage loans and the
origination process. GreenPoint may be required to repurchase the mortgage loans in the event of certain breaches of these