Prudential 2012 Annual Report Download - page 140

PRUDENTIAL FINANCIAL, INC.
Notes to Consolidated Financial Statements
4. INVESTMENTS (continued)
As of December 31, 2011
Current
30-59 Days
Past Due
60-89 Days
Past Due
Greater
Than 90
Days -
Accruing
Greater
Than 90
Days-Not
Accruing
Total Past
Due
Total
Commercial
Mortgage
and other
Loans
Non
Accrual
Status
(in millions)
Commercial mortgage loans ................... $30,060 $18 $12 $0 $129 $159 $30,219 $626
Agricultural property loans .................... 2,005 0 1 1 39 41 2,046 44
Residential property loans ..................... 988 22 6 0 18 46 1,034 18
Other collateralized loans ..................... 174 0 0 0 2 2 176 15
Uncollateralized loans ........................ 2,323 0 0 0 0 0 2,323 8
Total .................................. $35,550 $40 $19 $1 $188 $248 $35,798 $711
See Note 2 for further discussion regarding nonaccrual status loans.
For the year ended December 31, 2012, there were $47 million of commercial mortgage and other loans acquired, other than those
through direct origination. Additionally, there were no commercial mortgage and other loans sold, other than those classified as held-for-
sale. For the year ended December 31, 2011, there were $838 million of commercial mortgage and other loans acquired, other than those
through direct origination. Additionally, there were $183 million of commercial mortgage and other loans sold, other than those classified
as held-for-sale.
The commercial mortgage and other loans involved in a trouble debt restructuring pre-modification outstanding recorded investment
have been adjusted for any partial payoffs, and exclude troubled debt restructurings where the Company has received assets, other than
loans, in full satisfaction of the loan. See Note 2 for additional information relating to the accounting for troubled debt restructurings.
For the years ended December 31, 2012 and 2011, there was an adjusted pre-modification outstanding recorded investment of $20
million and $383 million respectively, and post-modification outstanding recorded investment of $18 million and $338 million
respectively, related to commercial mortgage loans. The amount of payment defaults during the period on commercial mortgage and other
loans that were modified as a troubled debt restructuring within the last 12 months was less than $1 million as of December 31, 2012.
As of December 31, 2012, the Company committed to fund $6 million to borrowers that have been involved in a troubled debt
restructuring.
Other Long-Term Investments
“Other long-term investments” are comprised as follows at December 31:
2012 2011
(in millions)
Joint ventures and limited partnerships:
Real estate-related ......................................................................... $ 1,250 $1,182
Non-real estate-related ...................................................................... 5,623 3,304
Total joint ventures and limited partnerships ......................................................... 6,873 4,486
Real estate held through direct ownership ............................................................... 2,108 2,460
Other ........................................................................................... 1,047 874
Total other long-term investments ............................................................. $10,028 $7,820
In certain investment structures, the Company’s asset management business invests with other co-investors in an investment fund
referred to as a feeder fund. In these structures, the invested capital of several feeder funds is pooled together and used to purchase
ownership interests in another fund, referred to as a master fund. The master fund utilizes this invested capital and, in certain cases, other
debt financing, to purchase various classes of assets on behalf of its investors. Specialized industry accounting for investment companies
calls for the feeder fund to reflect its investment in the master fund as a single net asset equal to its proportionate share of the net assets of
the master fund, regardless of its level of interest in the master fund. In cases where the Company consolidates the feeder fund, it retains the
feeder fund’s net asset presentation and reports the consolidated feeder fund’s proportionate share of the net assets of the master fund in
“Other long-term investments,” with any unaffiliated investors’ noncontrolling interest in the feeder fund reported in “Other liabilities” or
“Noncontrolling interests.” The consolidated feeder funds’ investments in these master funds, reflected on this net asset basis, totaled $97
million and $172 million as of December 31, 2012 and 2011, respectively. The unaffiliated interest in the consolidated feeder funds was $2
million as of both December 31, 2012 and 2011, and the master funds had gross assets of $1,049 million and $819 million, respectively,
and gross liabilities of $791 million and $565 million, respectively, which are not included on the Company’s balance sheet.
138 Prudential Financial, Inc. 2012 Annual Report