Bank of America 2014 Annual Report Download - page 194

192 Bank of America 2014
Credit Card Securitizations
The Corporation securitizes originated and purchased credit card
loans. The Corporation’s continuing involvement with the U.S.
securitization trust includes servicing the receivables, retaining an
undivided interest (seller’s interest) in the receivables, and holding
certain retained interests including senior and subordinate
securities, subordinate interests in accrued interest and fees on
the securitized receivables, and cash reserve accounts. The
seller’s interest in the U.S. trust, which is pari passu to the
investors’ interest, is classified in loans and leases. All debt issued
from the U.K. securitization trust has matured and the credit card
receivables were reconveyed to the Corporation during 2014.
The table below summarizes select information related to
consolidated credit card securitization trusts in which the
Corporation held a variable interest at December 31, 2014 and
2013.
Credit Card VIEs
December 31
(Dollars in millions) 2014 2013
Consolidated VIEs
Maximum loss exposure $ 43,139 $ 49,621
On-balance sheet assets
Derivative assets $1 $ 182
Loans and leases (1) 53,068 61,241
Allowance for loan and lease losses (1,904)(2,585)
Loans held-for-sale —386
All other assets (2) 391 2,281
Total $51,556 $ 61,505
On-balance sheet liabilities
Long-term debt $ 8,401 $ 11,822
All other liabilities 16 62
Total $ 8,417 $ 11,884
(1) At December 31, 2014 and 2013, loans and leases included $36.9 billion and $41.2 billion of seller’s interest.
(2) At December 31, 2014 and 2013, all other assets included restricted cash, certain short-term investments, and unbilled accrued interest and fees.
During 2014, $4.1 billion of new senior debt securities were
issued to third-party investors from the U.S. credit card
securitization trust and none were issued during 2013.
The Corporation held subordinate securities issued by credit
card securitization trusts with a notional principal amount of $7.4
billion and $7.9 billion at December 31, 2014 and 2013. These
securities serve as a form of credit enhancement to the senior
debt securities and have a stated interest rate of zero percent.
There were $662 million of these subordinate securities issued
during 2014 and none issued during 2013.