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74
Note 6—Loans to Bank Customers (continued)
Impaired Loans and Troubled Debt Restructurings
When, for economic or legal reasons related to a borrower’s financial difficulties, we grant a concession for other
than an insignificant period of time to a borrower that we would not otherwise consider, the related loan is classified
as a Troubled Debt Restructuring, or TDR. Our TDR modifications related to extensions of the maturity dates at a
stated interest rate lower than the current market rate for new debt with similar risk. The following table presents our
impaired loans and loans that we modified as TDRs as of December 31, 2015 and 2014:
December 31, 2015 December 31, 2014
Unpaid Principal
Balance Carrying Value Unpaid Principal
Balance Carrying Value
(In thousands)
Residential $ 24 $ 19 $ 97 $ 54
Commercial 257 19 270 31
Installment 241 128 367 104
Allowance for Loan Losses
Activity in the allowance for loan losses consisted of the following:
Year Ended December 31,
2015 2014 2013
(In thousands)
Balance, beginning of period $444 $464 $475
Provision (benefit) for loans (38)20 —
Loans charged off (44)(66)(25)
Recoveries of loans previously charged off 64 26 14
Balance, end of period $426 $444 $464
Note 7—Property and Equipment
Property and equipment consisted of the following:
December 31,
2015 2014
(In thousands)
Land $205 $205
Building 605 605
Computer equipment, furniture, and office equipment 45,508 45,525
Computer software purchased 16,900 20,363
Capitalized internal-use software 113,721 89,023
Tenant improvements 9,914 9,172
186,853 164,893
Less accumulated depreciation and amortization (107,976)(87,609)
Property and equipment, net $78,877 $77,284
Depreciation and amortization expense was $38.5 million, $32.5 million and $27.0 million for the years ended
December 31, 2015, 2014 and 2013, respectively. Included in those amounts are depreciation expense related to
internal-use software of $23.0 million, $18.4 million and $15.0 million for the years ended December 31, 2015, 2014
and 2013, respectively. We recorded impairment charges of $5.9 million and $5.2 million for the years ended
December 31, 2015 and 2013, respectively, associated with capitalized internal-use software we determined to no
longer be utilized and any remaining carrying value was written off. There were no such impairment charges for the
year ended December 31, 2014. The net carrying value of capitalized internal-use software was $47.6 million and
$39.8 million at December 31, 2015 and 2014, respectively.