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H&R Block, Inc. | 2014 Form 10-K 39
LOAN PORTFOLIO AND SUMMARY OF LOAN LOSS EXPERIENCE – The following table shows the composition of
HRB Bank's mortgage loan portfolio and information on delinquent loans:
(in 000s)
As of April 30, 2014 2013 2012 2011 2010
Residential real estate mortgages $ 277,253 $ 349,841 $ 428,568 $ 569,610 $ 683,452
Home equity lines of credit 170 170 174 183 232
$ 277,423 $ 350,011 $ 428,742 $ 569,793 $ 683,684
Loans and TDRs on non–accrual $ 79,894 $ 89,230 $ 108,839 $ 155,645 $ 185,209
Loans past due 90 days or more 57,882 74,992 99,044 149,501 153,703
Total TDRs 43,865 55,061 71,949 106,328 144,977
Interest income recorded on non-
accrual loans 3,575 4,025 5,682 6,311 7,452
Concentrations of loans to borrowers located in a single state may result in increased exposure to loss as a result
of changes in real estate values and underlying economic or market conditions related to a particular geographical
location. The table below presents outstanding loans by state, for states with a concentration of 5% or greater, for
our portfolio of mortgage loans held for investment as of April 30, 2014:
(dollars in 000s)
Loans
Purchased
from SCC
Loans
Purchased
from Other
Parties Total Percent
of Total Delinquency
Rate (30+ Days)
Florida $ 14,040 $ 39,945 $ 53,985 20% 10%
New York 51,264 7,173 58,437 21% 16%
California 23,397 5,560 28,957 10% 41%
Wisconsin 1,358 19,273 20,631 7% 9%
All others 69,507 45,906 115,413 42% 21%
Total $ 159,566 $ 117,857 $ 277,423 100%
A rollforward of HRB Bank's allowance for loss on mortgage loans is as follows:
(dollars in 000s)
Year ended April 30, 2014 2013 2012 2011 2010
Balance as of the beginning of the year $ 14,314 $ 26,444 $ 90,487 $ 93,535 $ 84,073
Provision 8,271 13,250 23,875 35,200 47,750
Recoveries 4,040 3,253 252 272 88
Charge-offs and transfers (15,353) (28,633) (88,170) (38,520) (38,376)
Balance as of the end of the year $ 11,272 $ 14,314 $ 26,444 $ 90,487 $ 93,535
Ratio of net charge-offs to average loans
outstanding during the year 3.74% 6.37% 19.61% 5.96% 4.95%