eTrade 2010 Annual Report Download - page 115

The following table summarizes the expense recognized by the Company as facility restructuring and other
exit activities for the periods presented (dollars in thousands):
Year Ended December 31,
2010 2009 2008
Restructuring of international brokerage business $ 6,846 $15,655 $ —
Restructuring of institutional brokerage business — — 10,292
Other facility restructuring and exit activities 7,500 4,997 19,210
Total facility restructuring and other exit activities $14,346 $20,652 $29,502
Facility restructuring and other exit activities expenses are not allocated to the Company’s operating
segments but are reported as a component of the “Corporate/Other” category within the Company’s segment
information.
Exit of Non-Core Operations
International Brokerage Business
In the fourth quarter of 2009, the Company decided to restructure its international brokerage business, which
provided trading products and services through two primary channels: 1) cross-border trading, where customers
residing outside of the U.S. trade in U.S. securities; and 2) local market trading, where customers residing outside
of the U.S. trade in non-U.S. securities. The Company exited local market trading as it is not a key strategic
component of the Company’s global brokerage product offering. This exit did not qualify for discontinued
operations accounting as the Company has significant continuing involvement in the international brokerage
business with cross-border trading.
The Company entered into agreements to sell the local market trading operations in Germany, the Nordic
region and the United Kingdom. The sale of the local market trading operations in Germany was completed in
December 2009. The Company closed the sales of the local market trading operations in the Nordic region and
United Kingdom in April 2010 and recognized a gain of $3.0 million.
As a result of the international brokerage business restructuring, the Company recognized $6.8 million and
$15.7 million in expense during the years ended December 31, 2010 and 2009, respectively. These costs include
$2.8 million and $7.4 million in severance costs and $4.0 million and $8.3 million in asset write-off and other
restructuring costs for the years ended December 31, 2010 and 2009, respectively. The Company expects to incur
charges in future periods as it periodically evaluates the estimates made in connection with this activity;
however, the Company does not expect these charges to be significant.
Institutional Brokerage Operations
In 2008, the Company announced the decision to exit certain institutional trading operations in the U.S. that
did not align with the core retail business. As a result of these exits, the Company incurred $5.6 million for
facilities consolidation and asset write-off costs, $3.1 million in severance costs and $1.5 million of other costs
related to this exit for the year ended December 31, 2008.
Other Exit Activities
In 2007, the Company decided to consolidate and relocate certain of its facilities, which continued into
2008. The Company incurred $21.4 million of charges for the year ended December 31, 2008, primarily related
to the exit of certain operating leases.
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