Aetna 2006 Annual Report Download - page 65

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Mortgage Loans
At December 31, 2006 and 2005, our mortgage loan balances, net of specific impairment reserves, by geographic
region and property type were as follows:
(Millions) 2006 2005 (Millions) 2006 2005
South Atlantic 439.6$ 373.3$ Office 557.5$ 578.3$
Middle Atlantic 232.4 308.7 Retail 271.1 227.9
New England 92.4 100.7 Apartment 235.5 239.7
South Central 105.9 69.1 Hotel/motel 21.6 25.5
North Central 278.4 259.0 Industrial 442.6 421.6
Pacific and Mountain 439.5 436.7 Mixed use 59.8 54.4
Total 1,588.2$ 1,547.5$ Other .1 .1
Total 1,588.2$ 1,547.5$
There were no material problem, restructured or potential problem loans included in mortgage loans at December
31, 2006 or 2005. We had no reserves on our mortgage loans at December 31, 2006 or 2005.
At December 31, 2006 scheduled mortgage loan principal repayments were as follows:
(Millions)
2007 168.4$
2008 26.4
2009 67.6
2010 106.8
2011 113.5
Thereafter 1,105.5
Variable Interest Entities (“VIEs”)
We do not have any material relationships with VIEs which would require consolidation. We have relationships
with certain real estate and hedge fund partnerships that are considered VIEs. However, we would not be
considered the primary beneficiary of these investments. We record the amount of our investment in these
partnerships as investment real estate and other long-term assets on our Consolidated Balance Sheets and recognize
our share of partnership income or losses in earnings. Our maximum exposure to loss as a result of our investment
in these partnerships is our investment balance at December 31, 2006 and 2005 of approximately $96 million and
$124 million, respectively, and the risk of recapture of tax credits related to the real estate partnerships previously
recognized, which we do not believe is significant. The real estate partnerships construct, own and manage low-
income housing developments and had total assets of approximately $1.9 billion at December 31, 2006 and 2005.
The hedge fund partnerships had total assets of approximately $70 billion and $123 million at December 31, 2006
and 2005, respectively.
Net Investment Income
Sources of net investment income in 2006, 2005 and 2004 were as follows:
(Millions) 2006 2005 2004
Debt securities 811.0$ 838.2$ 872.4$
Mortgage loans 136.9 136.8 133.2
Cash equivalents and other short-term investments 112.7 59.2 30.3
Other 139.1 107.0 65.1
Gross investment income 1,199.7 1,141.2 1,101.0
Less: Investment expenses (35.0) (38.2) (38.5)
Net investment income
(1)
1,164.7$ 1,103.0$ 1,062.5$
(1) Includes amounts related to experience-rated contract holders of $135.1 million, $143.6 million and $156.4 million in 2006, 2005
and 2004, respectively. Interest credited to experience-related contract holders is included in current and future benefits in our
Consolidated Statements of Income.
Page 63