Western Union 2015 Annual Report Download - page 234

THE WESTERN UNION COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
132
Balance Sheet
The following table summarizes the fair value of derivatives reported in the Consolidated Balance Sheets as of December 31,
2015 and December 31, 2014 (in millions):
Derivative Assets Derivative Liabilities
Fair Value Fair Value
Balance Sheet
Location
December 31,
2015
December 31,
2014
Balance Sheet
Location
December 31,
2015
December 31,
2014
Derivatives — hedges:
Interest rate fair value
hedges — Corporate . . . . . . . . . . . Other assets $ 7.6 $ 3.5 Other liabilities $ — $ 1.9
Foreign currency cash flow hedges
— Consumer-to-Consumer . . . . . . Other assets 59.7 66.1 Other liabilities 2.4 3.5
Total . . . . . . . . . . . . . . . . . . . . . . . . . . $ 67.3 $ 69.6 $ 2.4 $ 5.4
Derivatives — undesignated:
Foreign currency — Business
Solutions (a) . . . . . . . . . . . . . . . . . Other assets $ 326.1 $ 349.4 Other liabilities $ 277.1 $ 310.2
Foreign currency — Consumer-to-
Consumer. . . . . . . . . . . . . . . . . . . . Other assets 2.9 4.0 Other liabilities 4.2 1.5
Total . . . . . . . . . . . . . . . . . . . . . . . . . . $ 329.0 $ 353.4 $ 281.3 $ 311.7
Total derivatives . . . . . . . . . . . . . . . . . . $ 396.3 $ 423.0 $ 283.7 $ 317.1
____________________
(a) In many circumstances, the Company allows its Business Solutions customers to settle part or all of their derivative contracts
prior to maturity. However, the offsetting positions originally entered into with financial institution counterparties do not allow
for similar settlement. To mitigate this, additional foreign currency contracts are entered into with financial institution
counterparties to offset the original economic hedge contracts. This frequently results in increases in our derivative assets and
liabilities that may exceed the growth in the underlying derivatives business.
The following table summarizes the net fair value of derivatives held as of December 31, 2015 and their expected
maturities (in millions):
Total 2016 2017 2018 2019 2020 Thereafter
Foreign currency cash flow hedges — Consumer-to-Consumer. . . . $ 57.3 $ 50.3 $ 7.0 $ — $ — $ — $ —
Foreign currency undesignated hedges — Consumer-to-Consumer .(1.3) (1.3) — — — — —
Foreign currency undesignated hedges — Business Solutions . . . . . 49.0 46.6 2.4 — — — —
Interest rate fair value hedges — Corporate . . . . . . . . . . . . . . . . . . . 7.6 — 1.2 1.6 — 4.8 —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 112.6 $ 95.6 $ 10.6 $ 1.6 $ — $ 4.8 $ —
The fair values of derivative assets and liabilities associated with contracts that include netting language that the Company
believes to be enforceable have been netted in the following tables to present the Company's net exposure with these counterparties.
The Company's rights under these agreements generally allow for transactions to be settled on a net basis, including upon early
termination, which could occur upon the counterparty's default, a change in control, or other conditions.
In addition, certain of the Company's other agreements include netting provisions, the enforceability of which may vary from
jurisdiction to jurisdiction and depending on the circumstances. Due to the uncertainty related to the enforceability of these
provisions, the derivative balances associated with these agreements are included within "Derivatives that are not or may not be
subject to master netting arrangement or similar agreement" in the following tables. In certain circumstances, the Company may
require its Business Solutions customers to maintain collateral balances which may mitigate the risk associated with potential
customer defaults.
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