Sallie Mae 2014 Annual Report Download - page 105

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SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
4.
Investments (Continued)
The following table summarizes the amount of gross unrealized losses for our mortgage-backed securities and the
estimated fair value by length of time the securities have been in an unrealized loss position:
Less than 12 months
12 months or more
Total
Gross
unrealized
losses
Estimated
fair value
Gross
unrealized
losses
Estimated
fair value
Gross
unrealized
losses
Estimated
fair value
As of December 31, 2014:
Mortgage-backed securities ..............
$
(27
)
$
12,147
$
(1,465
)
$
41,462
$
(1,492
)
$
53,609
As of December 31, 2013:
Mortgage-backed securities ..............
$
(3,633
)
$
69,809
$
(1,945
)
$
16,176
$
(5,578
)
$
85,985
Our investment portfolio is comprised of mortgage-backed securities issued by Ginnie Mae, Fannie Mae and Freddie Mac
with amortized costs of $86,329, $65,850, and $15,561, respectively, at December 31, 2014. We own these securities to meet
our requirements under the Community Reinvestment Act. As of December 31, 2014, there were 10 of 13 separate mortgage-
backed securities with unrealized losses in our investment portfolio. Nine of the 13 securities in a net loss position were issued
under Ginnie Mae programs that carry a full faith and credit guarantee from the U.S. Government. The remaining securities in a
net loss position carry a principal and interest guarantee by Fannie Mae. As of December 31, 2013, there were 20 of 33 separate
mortgage-backed securities with unrealized losses in our investment portfolio. Ten of the 20 securities in a net loss position
were issued by Ginnie Mae. We have the ability and the intent to hold these securities for a period of time sufficient for the
market price to recover to at least the adjusted amortized cost of the security.
As of December 31, 2014, the amortized cost and fair value of securities, by contractual maturities, are summarized
below. Contractual maturities versus actual maturities may differ due to the effect of prepayments.
Year of Maturity
Amortized
Cost
Estimated
Fa ir Va lue
2038 ................................
$
604
$
647
2039 ................................
11,298
12,145
2042 ................................
27,721
26,617
2043 ................................
73,534
74,505
2044 ................................
54,583
55,020
Total ................................
$
167,740
$
168,934
In October 2013, we sold our asset-backed security portfolio for a gain of $63,813. We no longer hold asset-backed
securities in our investment portfolio.
The mortgage-backed securities have been pledged to the FRB as collateral against any advances and accrued interest
under the Primary Credit program or any other program sponsored by the FRB. We had $160,949 and $103,049 par value of
mortgage-backed securities pledged to this borrowing facility at December 31, 2014 and 2013, respectively, as discussed further
in Note 10, “Borrowed Funds.”
F-21