Discover 2009 Annual Report Download - page 122

In addition to performance measures associated with the transferred credit card loan receivables, there are other
events or conditions which could trigger an early amortization event. As of November 30, 2009, no economic or other
early amortization events have occurred.
The tables below provide information concerning investors’ interests and related excess spreads at November 30,
2009 (dollars in thousands):
Investors’
Interests(1)
# of Series
Outstanding
Discover Card Master Trust I ......................................................................................................................................... $14,134,204 16
Discover Card Execution Note Trust (DiscoverSeries notes) ................................................................................................. 12,759,358 27
Total investors’ interests............................................................................................................................................. $26,893,562 43
(1) Effective July 31, 2009, all DCMT certificates and all notes issued by DCENT include cash flows derived from merchant discount and interchange revenue earned by Discover card.
3-Month Rolling
Average Excess
Spread(1)(2)
Group excess spread percentage..................................................................................................................................................... 11.43%
DiscoverSeries excess spread percentage .......................................................................................................................................... 10.57%
(1) DCMT certificates refer to the higher of the Group excess spreads (as shown above) or their applicable series excess spreads in assessing whether an economic early amortization has occurred.
DiscoverSeries notes refer to the higher of the Group or DiscoverSeries excess spreads (both of which are shown above) in assessing whether an economic early amortization has occurred.
(2) Discount Series (DCMT 2009-SD), which was issued in September 2009, makes principal collections available for reallocation to other series to cover shortfalls in interest and servicing fees and to
reimburse charge-offs. Three-month rolling average excess spread rates reflected the benefit of these additional collections.
During the years ended November 30, 2009, 2008 and 2007, the Company recognized a net revaluation of its
subordinated retained interests, principally the interest-only strip receivable, consisting of losses of $160.1 million and
$119.3 million and gains of $51.3 million, respectively, in securitization income in the consolidated statements of
income. Included in these amounts are $16.7 million, $71.9 million, and $122.9 million, respectively, of initial gains on
new securitization transactions, net of issuance discounts, as applicable.
The following table summarizes certain cash flow information related to the securitized pool of loan receivables (dollars
in millions):
For the Years Ended
November 30,
2009 2008 2007
Proceeds from third-party investors in new credit card securitizations............................................................................... $ 3,543 $ 5,562 $ 8,434
Proceeds from collections reinvested in previous credit card securitizations ....................................................................... $46,753 $57,495 $58,843
Contractual servicing fees received............................................................................................................................. $ 490 $ 556 $ 534
Cash flows received from retained interests.................................................................................................................. $ 1,980 $ 2,777 $ 2,435
Purchases of previously transferred credit card receivables (securitization maturities).......................................................... $ 5,739 $ 7,739 $ 6,474
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