Discover 2011 Annual Report Download - page 118
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106
Available-for-sale investment securities (1)
U.S Treasury securities
U.S government agency securities
Credit card asset-backed securities of other
issuers
Corporate debt securities
Total available-for-sale investment
securities
Held-to-maturity investment securities
U.S. Treasury securities
State and political subdivisions of states
Residential mortgage-backed securities
To-be-announced securities (2)
Total held-to-maturity investment securities
One Year
or
Less
0.37%
0.47%
2.56%
0.58%
0.65%
0.07%
—%
—%
3.73%
3.69%
After One
Year
Through
Five Years
1.23%
1.43%
3.47%
0.78%
1.39%
—%
2.74%
—%
—%
2.74%
After Five
Years
Through
Ten Years
—%
—%
—%
—%
—%
—%
5.42%
—%
—%
5.42%
After Ten
Years
—%
—%
—%
—%
—%
—%
4.71%
5.50%
—%
4.83%
Total
1.09%
1.16%
3.04%
0.62%
1.18%
0.07%
4.60%
5.50%
3.73%
4.19%
(1) The weighted average yield for available-for-sale investment securities is calculated based on the amortized cost.
(2) The weighted average yield for to-be-announced securities is calculated based on yield applicable to the underlying investment rather than the forward
contract.
The following table presents interest and dividends on investment securities (dollars in thousands):
Taxable interest
Tax exempt interest
Total income from investment securities
For the Years Ended November 30,
2011
$ 57,622
1,743
$ 59,365
2010
$ 23,857
2,365
$ 26,222
2009
$ 65,959
2,735
$ 68,694
Other Investments
As a part of the Company's community reinvestment initiatives, the Company has made equity investments in certain
limited partnerships and limited liability companies that finance the construction and rehabilitation of affordable rental housing,
as well as stimulate economic development in low to moderate income communities. These investments are accounted for
using the equity method of accounting, and are recorded within other assets, and the related commitment for future investments
is recorded in other liabilities within the statement of financial condition. The portion of each investment's operating results
allocable to the Company is recorded in other expense within the statement of income. The Company earns a return primarily
through the receipt of tax credits allocated to the affordable housing projects and the community revitalization projects. These
investments are not consolidated as the Company does not have a controlling financial interest in the entities. As of
November 30, 2011 and 2010, the Company had outstanding investments of $137.9 million and $46.1 million respectively in
these entities, and the related contingent liability was $6.3 million and $3.1 million respectively.
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