Cabela's 2010 Annual Report Download - page 91

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81
CABELA’S INCORPORATED AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands Except Share and Per Share Amounts)
The following table presents the components of the consolidated assets and liabilities of the Trust at
January 1, 2011:
Consolidated assets:
Restricted credit card loans, net of allowance of $90,100 $ 2,685,668
Restricted cash 18,575
Total $2,704,243
Consolidated liabilities:
Secured variable funding obligations $ 393,000
Secured long-term obligations 1,590,900
Interest due to third party investors 2,336
Total $1,986,236
4. CREDIT CARD LOANS AND ALLOWANCE FOR LOAN LOSSES
WFB grants individual credit card loans to its customers and is diversified in its lending with borrowers
throughout the United States. With the adoption of ASC Topics 810 and 860, the securitized credit card loans of the
Trust were consolidated as restricted credit card loans as of January 3, 2010. See Note 3 for additional information
on the consolidation of the Trust and a summary of the credit card loans as of January 2, 2010. The following table
reflects the credit card loans at January 1, 2011:
Credit card loans:
Restricted credit card loans of the Trust (1) $ 2,775,768
Unrestricted credit card loans 24,444
Total credit card loans 2,800,212
Allowance for loan losses (90,900)
Credit card loans, net $ 2,709,312
(1) Restricted credit card loans are restricted for repayment of secured borrowings of the Trust.
The allowance for loan losses is intended to cover losses inherent in WFB’s loan portfolio as of the reporting
date. The following table reflects the activity in the allowance for loan losses for the years ended:
2010 2009 2008
Balance, beginning of year $ 1,374 $1,507 $1,197
Change in allowance upon adoption of ASC Topics 810 and 860 114,573 - -
115,947 1,507 1,197
Provision for loan losses 66,814 1,107 1,260
Charge-offs (108,111)(1,429)(1,193)
Recoveries 16,250 189 243
Net charge-offs (91,861)(1,240)(950)
Balance, end of year $ 90,900 $1,374 $1,507
WFB segments the loan portfolio into loans that have been restructured and other credit card loans in order to
facilitate the estimation of the losses inherent in the portfolio as of the reporting date. WFB uses the scores of Fair
Isaac Corporation (“FICO”), a widely-used tool for assessing an individual’s credit rating, as the primary credit