eTrade 2002 Annual Report Download - page 120

Table of Contents
Index to Financial Statements
4.BROKERAGE RECEIVABLES, NET AND BROKERAGE PAYABLES
Brokerage receivables, net and brokerage payables consist of the following (in thousands):
December31,
2002 2001
Receivable from customers and non-customers (less allowance for doubtful accounts of $3,062 and
$3,608)
$ 1,153,000 $ 1,631,845
Receivable from brokers, dealers and clearing organizations:
Net settlement and deposits with clearing organizations 53,912 113,527
Deposits paid for securities borrowed 279,214 371,682
Securities failed to deliver 1,707 776
Other 12,256 21,323
Total brokerage receivables, net $ 1,500,089 $ 2,139,153
Payable to customers and non-customers $ 2,178,175 $ 2,018,352
Payable to brokers, dealers and clearing organizations:
Deposits received for securities loaned 581,534 648,168
Securities failed to receive 3,117 1,491
Other 29,184 31,973
Total brokerage payables $ 2,792,010 $ 2,699,984
Receivable from and payable to brokers, dealers and clearing organizations results from the Company’ s brokerage activities. Receivable from
customers and non-customers represents credit extended to customers and non-customers to finance their purchases of securities on margin as
well as amounts receivable from customers upon settlement of their trades. Credit extended to customers and non-customers with respect to
margin accounts was $980 million at December 31, 2002 and $1,537 million at December 31, 2001. Securities owned by customers and
non-customers are held as collateral for amounts due on margin balances, the value of which is not reflected in the accompanying consolidated
balance sheets. As of December 31, 2002, the Company has received collateral primarily in connection with securities borrowed and customer
margin loans which it can sell or repledge with a market value of $927 million. Of this amount, $677 million has been pledged or sold as of
December 31, 2002 in connection with securities loans, bank borrowings and deposits with clearing organizations. Included in deposits paid for
securities borrowed and deposits received for securities loaned at December 31, 2002 are amounts from transactions involving MJK Clearing
and three other brokers. The parties in this transaction have a dispute over the amounts owed, as more fully described in Note 27. Payable to
customers and non-customers represents free credit balances and other customer and non-customer funds pending completion of securities
transactions. The Company pays interest on certain customer and non-customer credit balances.
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2003. EDGAR Online, Inc.