Ameriprise 2010 Annual Report Download - page 160

Commission (‘‘SEC’’) and the Minnesota Department of Commerce. The terms of the investment certificates issued by ACC
and the provisions of the 1940 Act also require the maintenance by ACC of qualified assets. Under the provisions of its
certificates and the 1940 Act, ACC was required to have qualified assets (as that term is defined in Section 28(b) of the
1940 Act) in the amount of $3.1 billion and $4.1 billion at December 31, 2010 and 2009, respectively. ACC had
qualified assets of $3.4 billion and $4.5 billion at December 31, 2010 and 2009, respectively. Ameriprise Financial and
ACC entered into a Capital Support Agreement on March 2, 2009, pursuant to which Ameriprise Financial agrees to
commit such capital to ACC as is necessary to satisfy applicable minimum capital requirements, up to a maximum
commitment of $115 million. For the years ended December 31, 2010 and 2009, ACC did not draw upon the Capital
Support Agreement and had met all applicable capital requirements.
Threadneedle’s required capital is predominantly based on the requirements specified by its regulator, the Financial
Services Authority, under its Capital Adequacy Requirements for asset managers.
The Company has five broker-dealer subsidiaries, American Enterprise Investment Services, Inc., Ameriprise Financial
Services, Inc., Securities America, Inc. (‘‘SAI’’), RiverSource Distributors, Inc. and Columbia Management Investment
Distributors, Inc. The broker-dealers are subject to the net capital requirements of the Financial Industry Regulatory
Authority (‘‘FINRA’’) and the Uniform Net Capital requirements of the SEC under Rule 15c3-1 of the Securities Exchange
Act of 1934.
Ameriprise Trust Company is subject to capital adequacy requirements under the laws of the State of Minnesota as
enforced by the Minnesota Department of Commerce.
Ameriprise Bank was required to maintain sufficient capital to provide a Tier 1 (core) capital ratio of 8.0% for the first three
years of operations under the Federal Deposit Insurance Corporation’s (‘‘FDIC’’) de novo guidance. The 8.0% de novo
requirement ended in 2009. In 2010, the Office of Thrift Supervision (‘‘OTS’’) reduced Ameriprise Bank’s core capital
requirement to 7.5%, but also increased Ameriprise Bank’s total risk-based capital requirement from the published OTS
amount of 8.0% of total risk-weighted assets, to 12.0%. The OTS also requires Ameriprise Bank to maintain minimum
ratios of Tier 1 and total capital to risk-weighted assets, as well as Tier 1 capital to adjusted total assets and tangible
capital to adjusted total assets. Under OTS prompt corrective action (‘‘PCA’’) regulations, Ameriprise Bank is required to
have a leverage ratio of core capital to adjusted total assets of at least 4%, a Tier 1 risk-based capital ratio of at least 4%,
a total risk-based ratio of at least 8% and a tangible capital ratio of at least 1.5%. As a thrift, the Company is also
required to maintain 65% of its portfolio assets in qualified thrift investments, which is a provision in the Qualified Thrift
Lender Test, which include mortgage and consumer related loans and investments. As of December 31, 2010 and 2009,
Ameriprise Bank had met all applicable capital requirements.
21. Income Taxes
The components of income tax provision (benefit) were as follows:
Years Ended December 31,
2010 2009 2008
(in millions)
Current income tax:
Federal $ (224) $ 199 $ 50
State and local 13 4 9
Foreign 32 4 17
Total current income tax (179) 207 76
Deferred income tax:
Federal 524 (13) (376)
State and local (5) (7) (22)
Foreign (6) (4) (11)
Total deferred income tax 513 (24) (409)
Total income tax provision (benefit) $ 334 $ 183 $ (333)
The geographic sources of pretax income (loss) were as follows:
Years Ended December 31,
2010 2009 2008
(in millions)
United States $ 1,430 $ 883 $ (442)
Foreign 164 37 19
Total $ 1,594 $ 920 $ (423)
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