HR Block 2009 Annual Report Download - page 38

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INVESTMENT PORTFOLIO –The following table presents the cost basis and fair value of HRB Bank’s
investment portfolio at April 30, 2009, 2008 and 2007:
Cost Basis Fair Value Cost Basis Fair Value Cost Basis Fair Value
April 30, 2009 2008 2007
(in 000s)
Mortgage-backed securities $ 27,466 $ 26,793 $ 30,809 $ 29,401 $ 35,122 $ 35,084
Federal funds sold 157,326 157,326 9,938 9,938 53,946 53,946
FHLB stock 6,730 6,730 7,536 7,536 9,091 9,091
Trust preferred security 3,454 292 3,500 2,809 3,500 3,500
$ 194,976 $ 191,141 $ 51,783 $ 49,684 $ 101,659 $ 101,621
The following table shows the cost basis, scheduled maturities and average yields for HRB Bank’s investment
portfolio at April 30, 2009:
Cost
Basis
Balance
Due
Average
Yield
Balance
Due
Average
Yield
Balance
Due
Average
Yield
Less Than One Year After Ten Years Total
(dollars in 000s)
Mortgage-backed securities $ 27,466 $ – – % $ 27,466 2.68% $ 27,466 2.68%
Federal funds sold 157,326 157,326 0.26% – – % 157,326 0.26%
FHLB stock 6,730 – – % 6,730 1.93% 6,730 1.93%
Trust preferred security 3,454 – – % 3,454 2.37% 3,454 2.37%
$ 194,976 $ 157,326 $ 37,650 $ 194,976
LOAN PORTFOLIO AND SUMMARY OF LOAN LOSS EXPERIENCE –The following table shows the
composition of HRB Bank’s mortgage loan portfolio as of April 30, 2009, 2008 and 2007, and information on
delinquent loans:
April 30, 2009 2008 2007
(in 000s)
Residential real estate mortgages $ 821,583 $ 1,004,283 $ 1,350,612
Home equity lines of credit 254 357 280
$ 821,837 $ 1,004,640 $ 1,350,892
Loans and TDRs on non-accrual $ 222,382 $ 110,759 $ 22,909
Loans past due 90 days or more 121,685 73,600 22,909
Total TDRs 160,741 37,159 –
Of total loans outstanding at April 30, 2009, 65% were adjustable-rate loans and 35% were fixed-rate loans.
Concentrations of loans to borrowers located in a single state may result in increased exposure to loss as a result
of changes in real estate values and underlying economic or market conditions related to a particular geographical
location. The table below presents outstanding loans by state for our portfolio of mortgage loans held for
investment as of April 30, 2009:
Loans
Purchased
from SCC
Loans
Purchased
from Other
Parties Total
Percent
of Total
Delinquency
Rate (30+ Days)
(dollars in 000s)
Florida $ 68,080 $ 91,707 $ 159,787 19.4% 19.78%
California 124,750 14,965 139,715 17.0% 30.10%
New York 103,325 9,386 112,711 13.7% 22.84%
Wisconsin 2,241 65,882 68,123 8.3% 2.54%
All others 232,837 108,664 341,501 41.6% 19.07%
Total $ 531,233 $ 290,604 $ 821,837 100.0% 20.23%
34 H&R BLOCK 2009 Form 10K