eTrade 2004 Annual Report Download - page 95

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Table of Contents
Index to Financial Statements
The Company actively sells loans originated by the Bank and correspondents. From time-to-time, the Company also sells loans that it
originally purchased from others. A summary of these activities is presented below (in thousands):
The following is the relative breakout of nonperforming loans (in thousands):
Interest income is not accrued for loans classified as nonperforming and any income accrued through the initial 90-day delinquency is
reversed. We classify loans as nonperforming whenever principal or interest payments are more than 90 days past due or when we have reason
to believe the loan is uncollectible. Had these loans been current at December 31, 2004, the Company would have recognized $1.0 million, $1.1
million and $1.4 million of additional income in 2004, 2003 and 2002, respectively. During 2004, the Company recognized $1.3 million of
interest on loans that were in nonperforming status at December 31, 2004. At December 31, 2004, there were no commitments to lend
additional funds to any of these borrowers.
Activity in the allowance for loan losses is summarized as follows (in thousands):
At December 31, 2004 and 2003, the Company had $15.3 million and $3.0 million of impaired loans, respectively, which consist
primarily of loans secured by one- to four-family residences. The average recorded investment was $15.4 million for 2004 and $2.5 million for
2003.
86
Year Ended December 31,
2004
2003
2002
Loans sold:
Correspondent
$
2,395,886
$
4,114,563
$
6,011,964
Origination
$
4,339,901
$
9,401,248
$
5,999,900
Gain (loss) on sales of loans:
Correspondent loan sales
$
(3,447
)
$
186
$
26,104
Origination loan sales
$
71,561
$
192,467
$
128,506
December 31,
2004
2003
First mortgage loans, secured by one
-
to four
-
family residences
$
11,029
$
18,094
Home equity lines of credit and second mortgage
2,755
269
Recreational vehicle
1,416
1,399
Marine
908
1,067
Automobile
826
1,602
Credit card
2,999
2,147
Other
22
16
Total nonperforming loans
$
19,955
$
24,594
Year Ended December 31,
2004
2003
2002
Allowance for loan losses, beginning of year
$
37,847
$
27,666
$
19,874
Provision for loan losses
38,121
38,523
14,664
Acquired through acquisitions
1,547
2,748
14,428
Charge
-
offs
(50,341
)
(53,734
)
(31,962
)
Recoveries
20,507
22,644
10,662
Allowance for loan losses, end of year
$
47,681
$
37,847
$
27,666