Discover 2011 Annual Report Download - page 114

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102
a decrease in expected losses results in a prospective increase in the accretable yield on PCI student loans rather than an
immediate reduction of the loan loss allowance, the value of the indemnification asset will be adjusted prospectively through a
reduction in the rate of amortization. Amortization and valuation adjustments to the indemnification asset are recorded through
other income on the consolidated statement of income.
5. Investments
The Company’s investment securities consist of the following (dollars in thousands):
U.S. Treasury securities
U.S. government agency securities
States and political subdivisions of states
Other securities:
Certificated retained interests in DCENT and DCMT(1)
Credit card asset-backed securities of other issuers
Corporate debt securities(2)
Asset-backed commercial paper notes
To-be-announced investment securities
Residential mortgage-backed securities
Other debt and equity securities (3)
Total other securities
Total investment securities
November 30,
2011
$ 2,563,800
2,795,223
40,936
—
299,889
449,469
—
50,254
6,482
—
806,094
$ 6,206,053
2010
$ 1,575,403
1,888,701
51,774
—
1,031,112
507,896
—
—
9,800
10,709
1,559,517
$ 5,075,395
2009
$—
—
68,553
4,501,108
381,705
—
58,792
—
12,929
12,210
4,966,744
$ 5,035,297
(1) Upon adoption of Statements No. 166 and 167, the amount outstanding at November 30, 2009 was reclassified to loan receivables. See Note 2: Change
in Accounting Principle for more information.
(2) Amount represents corporate debt obligations issued under the Temporary Liquidity Guarantee Program (TLGP) that are guaranteed by the Federal
Deposit Insurance Corporation (FDIC).
(3) During the year ended November 30, 2011, commercial advances and other Community Reinvestment Act related loan funds were reclassified to be
included in Other Consumer Loans within the statement of financial condition.
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