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Settlement Assets and Obligations (Tables)

3 Months Ended

Mar. 31, 2022

Schedule of Settlement Assets and Obligations

Settlement assets and obligations consisted of the following (in millions):


	March 31, 2022
Settlement assets:
Cash and cash equivalents	$	685.7
Receivables from agents, Business Solutions customers, and others		1,137.4
Less: Allowance for credit losses		(19.9	)
Receivables from agents, Business Solutions customers, and others, net		1,117.5
Investment securities		1,402.3
Less: Allowance for credit losses		(0.1	)
Investment securities, net		1,402.2
Total settlement assets (a)	$	3,205.4
Settlement obligations:
Money transfer, money order, and payment service payables	$	2,507.9
Payables to agents		697.5
Total settlement obligations (a)	$	3,205.4


	December 31, 2021
Settlement assets:
Cash and cash equivalents	$	835.5
Receivables from agents, Business Solutions customers, and others		1,198.8
Less: Allowance for credit losses		(23.7	)
Receivables from agents, Business Solutions customers, and others, net		1,175.1
Investment securities		1,398.9
Total settlement assets	$	3,409.5
Settlement obligations:
Money transfer, money order, and payment service payables	$	2,838.9
Payables to agents		570.6
Total settlement obligations	$	3,409.5

(a)

Settlement assets and Settlement obligations include Assets held for sale and Liabilities associated with assets held for sale of $205.9 million and $566.0 million as of March 31, 2022 and December 31, 2021, respectively (see Note 4).

Summary of Activity in the Allowance for Credit Losses

The following tables summarize the activity in the allowance for credit losses on receivables from agents and others, and Business Solutions customers (in millions):


	Agents and			Business Solutions
	Others			Customers
Allowance for credit losses as of January 1, 2022	$	18.0		$	5.7
Current period provision for expected credit losses (a)		1.9			0.4
Write-offs charged against the allowance		(3.1	)		(0.4	)
Recoveries of amounts previously written off		1.7			—
Impacts of foreign currency exchange rates, divestitures, and other		(0.1	)		(4.2	)
Allowance for credit losses as of March 31, 2022	$	18.4		$	1.5


	Agents and			Business Solutions
	Others			Customers
Allowance for credit losses as of January 1, 2021	$	49.3		$	3.9
Current period provision for expected credit losses (a)		2.3			1.5
Write-offs charged against the allowance		(3.3	)		(0.4	)
Recoveries of amounts previously written off		1.9			—
Impacts of foreign currency exchange rates and other		(0.5	)		(0.1	)
Allowance for credit losses as of March 31, 2021	$	49.7		$	4.9

(a)

Provision does not include losses from chargebacks or fraud associated with transactions initiated through the Company’s digital channels, as these losses are not credit related. The Company recognized losses that were not credit-related of $10.0 million and $13.7 million for the three months ended March 31, 2022, and 2021, respectively.

Components of Investment Securities

The components of investment securities are as follows (in millions):


					Gross		Gross			Net
	Amortized		Fair		Unrealized		Unrealized			Unrealized
March 31, 2022	Cost		Value		Gains		Losses			Gains/(Losses)
Settlement assets:
Cash and cash equivalents:
Money market funds	$	6.7	$	6.7	$	—	$	—		$	—
Available-for-sale securities:
State and municipal debt securities (a)		1,254.8		1,232.0		5.5		(28.3	)		(22.8	)
State and municipal variable-rate demand notes		79.9		79.9		—		—			—
Corporate debt securities		61.9		58.9		—		(3.0	)		(3.0	)
United States government agency mortgage-backed securities		31.5		31.5		—		—			—
Total available-for-sale securities		1,428.1		1,402.3		5.5		(31.3	)		(25.8	)
Total investment securities	$	1,434.8	$	1,409.0	$	5.5	$	(31.3	)	$	(25.8	)


					Gross		Gross			Net
	Amortized		Fair		Unrealized		Unrealized			Unrealized
December 31, 2021	Cost		Value		Gains		Losses			Gains/(Losses)
Settlement assets:
Cash and cash equivalents:
Money market funds	$	7.9	$	7.9	$	—	$	—		$	—
Available-for-sale securities:
State and municipal debt securities (a)		1,182.6		1,219.9		39.8		(2.5	)		37.3
State and municipal variable-rate demand notes		84.8		84.8		—		—			—
Corporate and other debt securities		58.1		57.8		0.2		(0.5	)		(0.3	)
United States government agency mortgage- backed securities		35.6		36.4		0.8		—			0.8
Total available-for-sale securities		1,361.1		1,398.9		40.8		(3.0	)		37.8
Total investment securities	$	1,369.0	$	1,406.8	$	40.8	$	(3.0	)	$	37.8

The majority of these securities are fixed-rate instruments.

Contractual Maturities of Debt Securities

The following summarizes the contractual maturities of available-for-sale securities within Settlement assets as of March 31, 2022 (in millions):


	Fair Value
Due within 1 year	$	154.5
Due after 1 year through 5 years		540.0
Due after 5 years through 10 years		554.8
Due after 10 years		153.0
Total	$	1,402.3