Western Union 2006 Annual Report Download - page 81

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Notes to Consolidated Financial Statements 79
The unrealized losses as of December 31, 2006 and
2005 on the Company’s investments in state and municipal
obligations were the result of increases in interest rates
and were not related to credit quality. These unrealized
losses were deemed to be not other-than-temporary
because the Company has the ability and intent to hold
these investments until a recovery of fair value occurs,
which may be upon maturity.
All of the Company’s investments in preferred stock
are in government sponsored mortgage entities. Analyses
of the unrealized losses on preferred stock performed
during 2005 and 2004 indicated other-than-temporary
impairments on a portion of the Company’s investments,
resulting in impairment charges of $1.1 million and
$1.0 million for 2005 and 2004, respectively. There were
no charges recorded for other-than-temporary declines
in investment values in 2006.
The following summarizes contractual maturities of state and municipal obligations as of December 31, 2006
(in millions):
Amortized Fair
Cost Value
Due within 1 year $ 33.5 $ 33.6
Due after 1 year through 5 years 70.3 71.0
Due after 5 years through 10 years 8.8 8.8
Due after 10 years 32.9 33.0
$145.5 $146.4
Preferred stock is not included above because the securities do not have fixed maturities. Actual maturities may
differ from contractual maturities because issuers may have the right to call or prepay the obligations.
The following tables present the gross unrealized losses and fair value of Western Union’s investment securities
with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by investment category
and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2006
and 2005 (in millions):
Less than 12 Months Greater than 12 Months
Total
Unrealized Unrealized Total Unrealized
Fair Value Losses Fair Value Losses Fair Value Losses
DECEMBER 31, 2006
State and municipal obligations $ 7.7 $(0.1) $9.7 $ — $17.4 $(0.1)
$ 7.7 $(0.1) $9.7 $ — $17.4 $(0.1)
DECEMBER 31, 2005
State and municipal obligations $18.5 $(0.1) $ — $ — $18.5 $(0.1)
$18.5 $(0.1) $ — $ — $18.5 $(0.1)