MoneyGram 2013 Annual Report Download - page 46

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Table of Contents
Contractual and Regulatory Capital
Regulatory Capital Requirements
We have capital requirements relating to government regulations in the U.S. and other countries where we operate. Such regulations typically
require us to maintain certain assets in a defined ratio to our payment service obligations. Through our wholly owned subsidiary and licensed
entity, MPSI, we are regulated in the U.S. by various state agencies that generally require us to maintain a pool of liquid assets and investments
in an amount generally equal to the regulatory payment service obligation measure, as defined by each state, for our regulated payment
instruments, namely teller checks, agent checks, money orders and money transfers. The regulatory requirements do not require us to specify
individual assets held to meet our payment service obligations, nor are we required to deposit specific assets into a trust, escrow or other special
account. Rather, we must maintain a pool of liquid assets. Provided we maintain a total pool of liquid assets sufficient to meet the regulatory and
contractual requirements, we are able to withdraw, deposit or sell our individual liquid assets at will, without prior notice, penalty or limitations.
We were in compliance with all state liquidity requirements in 2013 .
We are also subject to regulatory requirements in various countries outside of the U.S., which typically result in a requirement to either prefund
agent settlements or hold minimum required levels of cash within the applicable country. The most material of these requirements is in the
United Kingdom, where our licensed entity, MoneyGram International Limited, is required to maintain cash, cash equivalent and interest-
bearing
investment balances equal to outstanding payment instruments issued in the European Community. This amount fluctuates based on our level of
activity within the European Community, and is likely to increase over time as our business expands in that region. Assets used to meet these
regulatory requirements support our payment service obligations, but are not available to satisfy other liquidity needs. As of
December 31,
2013 , we had approximately $99.7 million of cash deployed outside of the U.S. to meet regulatory requirements.
We were in compliance with all financial regulatory requirements as of December 31, 2013
. We believe that our liquidity and capital resources
will remain sufficient to ensure ongoing compliance with all financial regulatory requirements.
Other Funding Sources and Requirements
Contractual Obligations
The following table includes aggregated information about the Company’
s contractual obligations that impact our liquidity and capital needs.
The table includes information about payments due under specified contractual obligations, aggregated by type of contractual obligation as of
December 31, 2013 :
The above table reflects the principal and interest that will be paid through the maturity of the debt using the rates in effect on
December 31,
2013 , and assuming no prepayments of principal. Our Consolidated Balance Sheet at December 31, 2013 includes $842.9 million
of debt, net of
unamortized discounts of $0.7 million
. Operating leases consist of various leases for buildings and equipment used in our business. Signing
bonuses are payments to certain agents and financial institution customers as an incentive to enter into long-
term contracts. Marketing represents
contractual marketing obligations with certain agents, billers and corporate sponsorships. Other obligations are the results of agreements with
certain co-
investors to provide funds related to investments in limited partnership interests. We have other commitments as described further
below that are not included in this table as the timing and/or amount of payments are difficult to estimate.
44
Payments due by period
(Amounts in millions) Total
Less than
1 year
1-3 years
4-5 years
More than
5 years
Debt, including interest payments
$
1,067.3
$
45.4
$
89.7
$
88.5
$
843.7
Operating leases
55.3
15.2
18.0
10.4
11.7
Signing bonuses
62.1
33.5
26.1
2.5
—
Marketing
54.6
22.9
25.4
6.3
—
Other obligations
0.3
0.3
—
—
—
Total contractual cash obligations
$
1,239.6
$
117.3
$
159.2
$
107.7
$
855.4