PNC Bank 2014 Annual Report Download - page 143

We also have involvement with certain Agency and Non-
agency commercial securitization SPEs where we have not
transferred commercial mortgage loans. These SPEs were
sponsored by independent third-parties and the loans held by
these entities were purchased exclusively from other third-
parties. Generally, our involvement with these SPEs is as
servicer with servicing activities consistent with those
described above.
We recognize a liability for our loss exposure associated with
contractual obligations to repurchase previously transferred
loans due to breaches of representations and warranties and
also for loss sharing arrangements (recourse obligations) with
the Agencies. Other than providing temporary liquidity under
servicing advances and our loss exposure associated with our
repurchase and recourse obligations, we have not provided nor
are we required to provide any type of credit support,
guarantees, or commitments to the securitization SPEs or
third-party investors in these transactions. See Note 22
Commitments and Guarantees for further discussion of our
repurchase and recourse obligations.
The following table provides certain financial information and cash flows associated with PNC’s loan sale and servicing activities:
Table 56: Certain Financial Information and Cash Flows Associated with Loan Sale and Servicing Activities
In millions
Residential
Mortgages
Commercial
Mortgages (a)
Home Equity
Loans/Lines (b)
FINANCIAL INFORMATION – December 31, 2014
Servicing portfolio (c) $108,010 $186,032 $3,833
Carrying value of servicing assets (d) 845 506
Servicing advances (e) 501 299 31
Repurchase and recourse obligations (f) 107 35 29
Carrying value of mortgage-backed securities held (g) 3,365 1,269
FINANCIAL INFORMATION – December 31, 2013
Servicing portfolio (c) $113,994 $176,510 $4,321(h)
Carrying value of servicing assets (d) 1,087 549
Servicing advances (e) 571 412 11
Repurchase and recourse obligations (f) 131 33 22
Carrying value of mortgage-backed securities held (g) 4,144 1,475
In millions
Residential
Mortgages
Commercial
Mortgages (a)
Home Equity
Loans/Lines (b)
CASH FLOWS – Year ended December 31, 2014
Sales of loans (i) $ 8,344 $ 3,469
Repurchases of previously transferred loans (j) 744 $ 14
Servicing fees (k) 346 132 19
Servicing advances recovered/(funded), net 70 113 (20)
Cash flows on mortgage-backed securities held (g) 934 308
CASH FLOWS – Year ended December 31, 2013
Sales of loans (i) $ 14,650 $ 2,754
Repurchases of previously transferred loans (j) 1,191 $ 9
Servicing fees (k) 362 176 21
Servicing advances recovered/(funded), net 11 93 (6)
Cash flows on mortgage-backed securities held (g) 1,456 411
(a) Represents financial information and cash flows associated with both commercial mortgage loan transfer and servicing activities.
(b) These activities were part of an acquired brokered home equity lending business in which PNC is no longer engaged. See Note 22 Commitments and Guarantees for further
information.
(c) For our continuing involvement with residential mortgages, this amount represents the outstanding balance of loans we service, including loans transferred by us and loans originated
by others where we have purchased the associated servicing rights. For home equity loan/line of credit transfers, this amount represents the outstanding balance of loans transferred
and serviced. For commercial mortgages, this amount represents our overall servicing portfolio in which loans have been transferred by us or third parties to VIEs.
(d) See Note 7 Fair Value and Note 8 Goodwill and Other Intangible Assets for further information.
(e) Pursuant to certain contractual servicing agreements, represents outstanding balance of funds advanced (i) to investors for monthly collections of borrower principal and interest,
(ii) for borrower draws on unused home equity lines of credit, and (iii) for collateral protection associated with the underlying mortgage collateral.
(f) Represents liability for our loss exposure associated with loan repurchases for breaches of representations and warranties for our Residential Mortgage Banking and Non-Strategic
Assets Portfolio segments, and our commercial mortgage loss share arrangements for our Corporate & Institutional Banking segment. See Note 22 Commitments and Guarantees for
further information.
(Continued on following page)
The PNC Financial Services Group, Inc. – Form 10-K 125