Navy Federal Credit Union 2009 Annual Report Download - page 20

Navy Federal has obligations under a number of non-cancelable operating leases for premises. The future
minimum payments under the terms of the leases as of December 31, 2009 were:
Rent expense was $18.6 million and $18.2 million in 2009 and 2008, respectively. In 2009, Navy Federal
received income from sublease contracts of $75,000 while it received $73,000 from sublease contracts in 2008.
Note 10: Goodwill
Goodwill acquired in business combinations is tested for impairment quarterly in accordance with ASC 350-35,
Goodwill and Other Intangible Assets (formerly known as SFAS No. 142).Navy Federal uses the number of
new accounts opened at acquired office locations to estimate the fair value of the goodwill. The carrying value
of the goodwill was $14.9 million at December 31, 2009 and 2008, and is included in “Other assets” in the
Consolidated Statements of Financial Condition.
Note 11: Members’ Accounts
Member deposit accounts as of December 31, 2009 and 2008 were summarized as follows:
The Helping Families Save Their Homes Act of 2009, signed into law May 20, 2009, includes a provision
extending the $250,000 share insurance coverage provided by the National Credit Union Share Insurance
Fund through December 31, 2013. Previously, this level of coverage was set to expire on December 31, 2009.
As such, the total uninsured amount of members’ accounts was $1.6 billion and $1.3 billion at December 31,
2009 and 2008, respectively. Based on the original insurance coverage of $100,000 per non-IRA account and
$250,000 per IRA account, the amount of members’ accounts exceeding the original coverage limits was
$4.9 billion and $3.8 billion at December 31, 2009 and 2008, respectively.
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2009 Financial Section
Note 7: Legal Contingencies
Navy Federal is a party to various legal actions normally associated with financial institutions, the aggregate
effect of which, in management’s and legal counsel’s opinion, would not be material to the financial condition
or results of operations of Navy Federal.
Note 8: Commitments
Navy Federal is a party to conditional commitments to lend funds in the normal course of business to meet the
financing needs of its members. Unused commitments for loans to members are amounts which Navy Federal
has agreed to lend a member as long as the member does not default on existing loans or violate any condition
of the loan agreement. Commitments generally have fixed expiration dates or other termination clauses. Since
many of the commitments are expected to expire without being drawn upon, the total commitment amounts
do not necessarily represent future cash requirements. Navy Federal uses the same credit policies in making
commitments as it does for all loans to members and, accordingly, at December 31, 2009, the credit risk
related to these commitments was similar to that on its existing loans.
Unused commitment balances as of December 31, 2009 and 2008 were as follows:
Note 9: Fixed Assets
The following is a summary of property and equipment Navy Federal owned at December 31, 2009 and 2008:
Navy Federal Credit Union
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(dollars in thousands) 2009 2008
Unused Commitments
Credit cards $ 5,707,412 $ 5,222,057
NAVchek lines of credit 577,302 564,354
Home equity lines of credit 1,113,517 1,247,390
Pre-approved auto loans 177,905 195,712
Utility deposit guarantee programs 3,281 3,146
Letter of credit 7,500 7,500
Total $ 7,586,917 $ 7,240,159
(dollars in thousands) 2009 2008
Property and Equipment
Land and buildings $ 607,387 $ 554,339
Equipment, furniture and fixtures 550,836 517,207
Leasehold improvements 107,850 107,200
Subtotal 1,266,073 1,178,746
Less: Accumulated depreciation (547,487) (472,319)
Total $ 718,586 $ 706,427
(dollars in thousands) Amount
2010 $ 14,945
2011 13,751
2012 11,695
2013 9,946
Thereafter 23,118
Total $ 73,455
2009
(dollars in thousands)
Weighted
Average Rate
for 2009
2009
Weighted
Average Rate
for 2008
2008
Money market 1.11% $ 5,179,419 2.32% $ 4,260,542
Share savings 0.44% 5,673,060 0.89% 4,826,346
Member escrow 0.23% 115,464 0.56% 109,582
Sharechek 0.26% 4,215,143 0.43% 3,579,195
Share and IRA certificates 3.61% 12,683,923 4.51% 11,470,990
IRA shares 0.56% 394,303 1.30% 364,409
IRA MMSA 0.94% 86,980 2.02% 52,422
Investor custodial accounts 0.00% 97,466 0.00% 62,029
Total deposits $ 28,445,758 $ 24,725,515