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I.
Corporate Fund Financial Statement Results -
Third Quarter 2007
DIF
- For the nine
months ending September 30, 2007, DIF’s
comprehensive income totaled $1.589 billion compared to $1.395
billion for the same period last year, an increase of 14 percent.
Excluding the
recognition of exit fees earned of $345 million (a one-time adjustment),
comprehensive income rose by $539 million, or 51 percent, from
a year ago. This year-over-year increase was primarily due to
a $190 million
increase in interest revenue, a $382 million increase in assessment
revenue, a $139 million decrease in the unrealized loss on AFS
securities, offset
by a $27 million increase in operating expenses and a $157 million
increase in the provision for insurance losses.
- During the third quarter of 2007, DIF’s YTD provision for
insurance losses increased by $132 million to $56 million primarily
due to an $83 million increase in the estimated loss for the NetBank
failure and a $64 million increase in the contingent loss reserve
for anticipated failures.
FRF
- FRF reported net income of $39 million for the third quarter of
2007, decreasing the YTD net loss to $2 million. Net income for the quarter
included: 1) interest on U.S. Treasury obligations of $39 million; 2) tax
benefit recoveries of $4 million; and 3) an expense of $11 million to fund
the fiscal year 2008 goodwill expenses of the Department of Justice (which
was paid on October 1, 2007).
- During the third quarter of 2007, FRF paid $46 million
for two Goodwill cases (which were accrued for as of
June 30, 2007),
bringing the total
year-to-date litigation expenses to $179 million.
- Subsequent
to quarter-end, FRF paid $225 million to the Resolution Funding
Corporation (REFCORP) on October 10, 2007, bringing total
payments to REFCORP to $4.8 billion. The most recent prior payment
to REFCORP
was made on April 10, 2003 for $50 million.
The FDIC must transfer to the REFCORP the net proceeds from the sale
of FRF-RTC assets (once all liabilities of the FRF-RTC have been provided
for) to pay the interest on REFCORP bonds, which were issued to fund
early Resolution Trust Corporation resolutions. Any such payments benefit
the U.S. Treasury, which would otherwise be obligated to pay the interest
on the bonds.
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