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GREEN DOT CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)
82
Note 14—Fair Value of Financial Instruments (continued)
Deposits
The fair value of demand and interest checking deposits and savings deposits is the amount payable on demand
at the reporting date. We determined the fair value of time deposits by discounting expected future cash flows using
market-derived rates based on our market yields on certificates of deposit, by maturity, at the measurement date. Under
the fair value hierarchy, our deposits are classified as Level 2.
Fair Value of Financial Instruments
The carrying values and fair values of certain financial instruments that were not carried at fair value, excluding
short-term financial instruments for which the carrying value approximates fair value, at December 31,
2013 and December 31, 2012 are presented in the table below.
December 31, 2013 December 31, 2012
Carrying Value Fair Value Carrying Value Fair Value
(In thousands)
Financial Assets
Loans to bank customers, net of allowance $6,902 $5,926 $7,552 $5,719
Financial Liabilities
Deposits $219,580 $ 219,534 $ 198,451 $ 198,369
Note 15—Borrowing Agreements
In connection with the transition of all outstanding customer deposits associated with our card issuing program
with Synovus Bank to our subsidiary bank, in November 2012, our line of credit with Columbus Bank and Trust Company
was terminated. Prior to the termination, we used the line of credit to fund timing differences between funds remitted
by our retail distributors to the banks that issue our cards and funds utilized by our cardholders. For the periods
presented below, our line of credit had the following terms:
Line of Credit Interest Rate Cash Collateral
Requirements
(In millions, except interest rates)
March 2012 - November 2012 $ 10.0 LIBOR + 2.00% $ 10.0
March 2011 - March 2012 $ 10.0 LIBOR + 2.00% $ 10.0
We present our cash collateral requirements on our consolidated balance sheets as restricted cash. There were
no outstanding borrowings at December 31, 2013.
Note 16—Concentrations of Credit Risk
Financial instruments that subject us to concentration of credit risk consist primarily of unrestricted cash and cash
equivalents, restricted cash, investment securities, accounts receivable, loans and settlement assets. We deposit our
unrestricted cash and cash equivalents and our restricted cash with regional and national banking institutions that we
periodically monitor and evaluate for creditworthiness. Credit risk for our investment securities is mitigated by the types
of investment securities in our portfolio, which must comply with strict investment guidelines that we believe appropriately
ensures the preservation of invested capital. Credit risk for our accounts receivable is concentrated with card issuing
banks and our customers, and this risk is mitigated by the relatively short collection period and our large customer
base. We do not require or maintain collateral for accounts receivable. We maintain reserves for uncollectible overdrawn
accounts and uncollectible trade receivables. Approximately 94.1% of our borrowers reside in the state of Utah and
approximately 41.0% in the city of Provo. Consequently, we are susceptible to any adverse market or environmental
conditions that may impact this specific geographic region. Credit risk for our settlement assets is concentrated with
our retail distributors, which we periodically monitor.