Cash America 2011 Annual Report Download - page 129

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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
98
Other
The following table provides information concerning other acquisitions of domestic and foreign pawn lending
locations made during the years ended December 31, 2011, 2010 and 2009 (excluding locations acquired in connection
with the acquisitions described above related to Pawn Partners, Maxit and Prenda Fácil). All assets are included in the
retail services segment (dollars in thousands):
Year Ended December 31,
2011 2010 2009
N
umber of stores acquired:
Pawn lending locations 1 5 3
Purchase price allocated to:
Pawn loans $ 146 $ 803 $ 235
Merchandise held for disposition, net 74 422 148
Pawn loan fees and service charges receivable 34 118 23
Property and equipment 10 40 51
Goodwill - 1,227 372
Intangible assets 55 341 124
Other assets - 3 -
Other liabilities (9) (14) (43)
Customer deposits - (13) -
Total $ 310 $ 2,927 $ 910
Gain on bargain purchase(a) (44) - -
Purchase price adjustment for prior year acquisitions 12 - -
Total cash paid for acquisitions $ 278 $ 2,927 $ 910
(a) Gain on bargain purchase is recognized in “Other revenue” in the consolidated statements of income.
4. Credit Quality Information on Pawn Loans
The Company manages the pawn loan portfolio by monitoring the type and adequacy of collateral compared to
historical gross profit margins. If a pawn loan defaults, the Company must rely on the disposition of pawned property
to recover the principal amount of an unpaid pawn loan, plus a yield on the investment, because pawn loans are non-
recourse against the customer. As a result, the customer’s creditworthiness is not a significant factor in the loan
decision, and a decision to redeem pawned property does not affect the customer’s personal credit status with other
third-party creditors. In addition, the customer’s creditworthiness does not affect the Company’s financial position or
results of operations, because generally, forfeited merchandise has historically sold for an amount in excess of the cost
of goods sold (which is the lower of the cash amount loaned or market value). Goods pledged to secure pawn loans
are tangible personal property items such as jewelry, tools, televisions and other electronics, musical instruments, and
other miscellaneous items. A pawn loan is considered nonperforming if the customer does not make a payment in
accordance with the contractual requirements. Any accrued pawn loan fees and service charges are reversed on
nonperforming loans. As of December 31, 2011 and 2010, the Company had performing pawn loans outstanding of
$248.4 million and $213.5 million, respectively, and nonperforming pawn loans outstanding of $5.1 million and $4.9
million, respectively.