Charles Schwab 2013 Annual Report Download - page 76

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THE CHARLES SCHWAB CORPORATION
Notes to Consolidated Financial Statements
(Tabular Amounts in Millions, Except Per Share Data, Option Price Amounts, Ratios, or as Noted)
- 65 -
determined that these securities were OTTI. The Company does not intend to sell these securities and it is not “more likely
than not” that the Company will be required to sell these securities before anticipated recovery of the unrealized losses on
these securities. The Company recognized an impairment charge equal to the securities’ expected credit losses of $10 million
in 2013. The expected credit losses were measured as the difference between the present value of expected cash flows and the
amortized cost of the securities. Further deterioration in the performance of the underlying loans in the Company’s non-
agency residential mortgage-backed securities portfolio could result in the recognition of additional impairment losses.
The following table is a rollforward of the amount of credit losses recognized in earnings for OTTI securities held by the
Company during the period for which a portion of the impairment was reclassified from or recognized in other
comprehensive (loss) income:
Year Ended December 31, 2013 2012 2011
Balance at beginning of year $ 159 $ 127 $ 96
Credit losses recognized into current year earnings on debt securities for  
which an other-than-temporary impairment was not previously recognized 1 6 6
Credit losses recognized into current year earnings on debt securities for
which an other-than-temporary impairment was previously recognized 9 26 25
Balance at end of year $ 169 $ 159 $ 127
The maturities of securities available for sale and securities held to maturity at December 31, 2013, are as follows:
After 1 year After 5 years
Within through through After
1 year 5 years 10 years 10 years Total
Securities available for sale:
U.S. agency mortgage-backed securities (1) $ - $ 508 $ 4,458 $ 13,679 $ 18,645
Asset-backed securities - 1,219 3,284 10,703 15,206
Corporate debt securities 1,348 7,554 105 - 9,007
U.S. agency notes - 3,896 240 - 4,136
Certificates of deposit 1,826 1,826 - - 3,652
N
o
n
-agency residential mortgage-backed
securities (1) - 4 - 589 593
N
o
n
-agency commercial mortgage-backed
securities (1) - - - 279 279
Other securities 100 - - - 100
Total fair value $ 3,274 $ 15,007 $ 8,087 $ 25,250 $ 51,618
Total amortized cost $ 3,270 $ 15,062 $ 8,041 $ 25,231 $ 51,604
Securities held to maturity:
U.S. agency mortgage-backed securities (1) $ -
$ 555 $ 11,985 $ 15,960 $ 28,500
N
o
n
-agency commercial mortgage-backed
securities (1) -
- 337 553 890
Other securities 100 - - - 100
Total fair value $ 100 $ 555 $ 12,322 $ 16,513 $ 29,490
Total amortized cost $ 100 $ 550 $ 12,894 $ 16,774 $ 30,318
(1) Mortgage-backed securities have been allocated to maturity groupings based on final contractual maturities. Actual
maturities will differ from final contractual maturities because borrowers on a certain portion of loans underlying these
securities have the right to prepay their obligations.