eTrade 2010 Annual Report Download - page 84

Lending Activities
The following table presents the balance and associated percentage of each major loan category in our
portfolio (dollars in millions):
December 31,
2010 2009 2008 2007 2006
Balance % Balance % Balance % Balance % Balance %
One- to four-family $ 8,170.3 51.0% $10,567.1 52.4% $12,979.8 51.3% $15,607.4 51.5% $11,150.0 42.4%
Home equity 6,410.3 40.0 7,769.7 38.5 10,017.2 39.6 11,901.3 39.2 11,809.1 44.8
Consumer and other: 1,443.4 9.0 1,841.3 9.1 2,298.6 9.1 2,823.3 9.3 3,372.9 12.8
Total loans 16,024.0 100.0% 20,178.1 100.0% 25,295.6 100.0% 30,332.0 100.0% 26,332.0 100.0%
Adjustments:
Premiums (discounts) and
deferred fees on loans 129.1 171.6 236.8 315.5 391.8
Allowance for loan losses (1,031.2) (1,182.7) (1,080.6) (508.1) (67.6)
Total adjustments (902.1) (1,011.1) (843.8) (192.6) 324.2
Loans, net(1)(2) $15,121.9 $19,167.0 $24,451.8 $30,139.4 $26,656.2
(1) Excludes loans-held-for sale of $5.5 million and $7.9 million at December 31, 2010 and 2009, respectively. The third party company
providing this product performs all processing and underwriting of these loans and is responsible for the credit risk associated with these
loans, which minimizes our assumption of any of the typical risks commonly associated with mortgage lending. There is a short period of
time after closing of the loans in which we record the originated loan as held-for-sale prior to the third party company purchasing the
loan.
(2) Includes loans held-for-sale, principally one- to four-family real estate loans of $0.1 billion and $0.3 billion at December 31, 2007 and
2006, respectively. There were no loans held-for-sale at December 31, 2008. Loans held-for-sale are accounted for at lower of cost or fair
value with adjustments recorded in the gains (losses) on loans and securities, net line item and are not considered in the allowance for
loan losses.
The following table shows the contractual maturities of our loan portfolio at December 31, 2010, including
scheduled principal repayments. This table does not, however, include any estimate of prepayments. These
prepayments could significantly shorten the average loan lives and cause the actual timing of the loan repayments
to differ from those shown in the following table (dollars in millions):
Due in(1)
Total< 1 Year 1-5 Years >5 Years
One- to four-family $149.0 $ 686.0 $ 7,335.3 $ 8,170.3
Home equity 246.4 1,114.3 5,049.6 6,410.3
Consumer and other 183.7 457.5 802.2 1,443.4
Total loans(2) $579.1 $2,257.8 $13,187.1 $16,024.0
(1) Estimated scheduled principal repayments are calculated using weighted-average interest rate and weighted-average remaining maturity
of each loan portfolio.
(2) Excludes loans-held-for sale of $5.5 million at December 31, 2010. The third party company providing this product performs all
processing and underwriting of these loans and is responsible for the credit risk associated with these loans, which minimizes our
assumption of any of the typical risks commonly associated with mortgage lending. There is a short period of time after closing of the
loans in which we record the originated loan as held-for-sale prior to the third party company purchasing the loan.
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