eTrade 2009 Annual Report Download - page 118

in the Canadian brokerage business, and its operations and cash flows were eliminated from the ongoing
operations of the Company. The Company’s results of operations, net of income tax, include the Canadian
brokerage business as a discontinued operation on the Company’s consolidated statement of loss for all periods
presented. Prior to the Canadian brokerage business being recorded as a discontinued operation, it was included
in the results of operations of both the Company’s former retail and institutional segments.
The following table summarizes the results of discontinued operations for the Canadian brokerage business
(dollars in thousands):
For the year ended
December 31,
2008 2007
Net revenue $ 59,404 $85,175
Income from discontinued operations before income tax expense (benefit) $ 15,558 $33,032
Income tax expense (benefit) (19,473) 10,837
Income from discontinued operations, net of tax $ 35,031 $22,195
Exit of the Direct Retail Lending Business
In 2008, the Company exited its direct retail lending business, which was the Company’s last remaining
loan origination channel (the Company exited the wholesale mortgage lending business in 2007). The entire
direct retail lending business, including the wholesale mortgage lending business, met the requirements under the
discontinued operations accounting guidance to be recorded and reported as a discontinued operation. The
operations and cash flows of the direct retail lending business were eliminated from the ongoing operations of the
Company, and the Company does not have any significant continuing involvement in the direct retail lending
business after its closure. Therefore, the Company’s results of operations, net of income tax, include the direct
retail lending business as a discontinued operation on the Company’s consolidated statement of loss for all
periods presented. Prior to the direct retail lending business being recorded as a discontinued operation, it was
included in the results of operations of the Company’s former retail segment.
The following table summarizes the results of discontinued operations for the direct retail lending business
(dollars in thousands):
For the year ended
December 31,
2008 2007
Net revenue $ 1,300 $ 10,001
Loss from discontinued operations before income tax benefit $(9,932) $(35,450)
Income tax benefit (3,697) (13,838)
Loss from discontinued operations, net of tax $(6,235) $(21,612)
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