Discover 2010 Annual Report Download - page 85

The following table provides changes in our allowance for loan losses for the years presented (dollars in thousands):
For the Years Ended November 30,
2010
2009
(As Adjusted1)
2008
(As Adjusted1)
2007
(As Adjusted1)
2006
(As Adjusted1)
Balance at beginning of year, as adjusted ......................................... $ 3,902,360 $ 2,754,357 $ 1,731,655 $ 1,632,291 $ 1,948,823
Additions:
Provision for loan losses .............................................................. 3,206,705 5,123,030 3,476,644 1,896,753 1,438,746
Deductions:
Charge-off related to loans sold ................................................... (25,342) ————
Charge-offs:
Discover card......................................................................... (4,094,236) (4,242,494) (2,832,771) (2,201,741) (2,180,146)
Discover business card ............................................................ (59,986) (62,115) (19,814) (2,418) —
Total credit card loans .......................................................... (4,154,222) (4,304,609) (2,852,585) (2,204,159) (2,180,146)
Personal loans........................................................................ (92,351) (68,590) (7,974) (1,857) (3,962)
Federal student loans............................................................... (719) ————
Private student loans................................................................ (2,783) (468) (8) — —
Other.................................................................................... (1,018) (22) (83) (25) (29)
Total other consumer loans.................................................... (96,871) (69,080) (8,065) (1,882) (3,991)
Total charge-offs .............................................................. (4,251,093) (4,373,689) (2,860,650) (2,206,041) (2,184,137)
Recoveries:
Discover card......................................................................... 466,548 396,483 405,844 407,606 427,799
Discover business card ............................................................ 3,549 1,233 272 35 —
Total credit card loans .......................................................... 470,097 397,716 406,116 407,641 427,799
Personal loans........................................................................ 1,307 906 576 988 974
Private student loans................................................................ 38 2 — — —
Other.................................................................................... 46 38 16 23 86
Total other consumer loans.................................................... 1,391 946 592 1,011 1,060
Total recoveries................................................................ 471,488 398,662 406,708 408,652 428,859
Net charge-offs................................................................ (3,779,605) (3,975,027) (2,453,942) (1,797,389) (1,755,278)
Balance at end of year ................................................................... $ 3,304,118 $ 3,902,360 $ 2,754,357 $ 1,731,655 $ 1,632,291
(1) Information related to Discover card and total loans is presented on an adjusted basis. No adjustments have been made for Discover business card, personal loans, federal and private student
loans or other loans. See reconciliation in “ – Reconciliations of GAAP to As Adjusted Data.”
The following table presents a breakdown of the allowance for loan losses (dollars in thousands):
For the Years Ended November 30,
2010
2009
(As Adjusted1)
2008
(As Adjusted1)
2007
(As Adjusted1)
2006
(As Adjusted1)
Discover card ................................................................................ $3,182,603 $3,731,568 $2,664,986 $1,714,237 $1,627,320
Discover business card .................................................................... 26,285 59,979 32,597 8,279 2,216
Total credit card loans .............................................................. 3,208,888 3,791,547 2,697,583 1,722,516 1,629,536
Personal loans ............................................................................... 76,087 95,056 51,742 8,310 2,178
Federal student loans ...................................................................... — 968 142 4 —
Private student loans ....................................................................... 18,569 13,734 4,292 256 —
Other ........................................................................................... 574 1,055 598 569 577
Total other consumer loans........................................................ 95,230 110,813 56,774 9,139 2,755
Total allowance for loan losses ............................................ $3,304,118 $3,902,360 $2,754,357 $1,731,655 $1,632,291
(1) Information related to Discover card, credit card and total loan receivables is presented on an adjusted basis. No adjustments have been made for Discover business card, federal and private
student loans, personal loans or other loans. See reconciliation in “ – Reconciliations of GAAP to As Adjusted Data.”
-74-