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Settlement Assets and Obligations (Tables) | 6 Months Ended
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Jun. 30, 2023
Investments, Debt and Equity Securities [Abstract] |
Schedule of Settlement Assets and Obligations | Settlement assets and obligations consisted of the following (in millions):
|  | June 30, 2023 |
Settlement assets: |  |  |
Cash and cash equivalents |  | $ | 11.1 |
Receivables from agents, Business Solutions customers, and others |  |  | 2,000.6 |
Less: Allowance for credit losses |  |  | (11.7 | )
Receivables from agents, Business Solutions customers, and others, net |  |  | 1,988.9 |
Investment securities |  |  | 1,420.0 |
Less: Allowance for credit losses |  |  | (0.3 | )
Investment securities, net |  |  | 1,419.7 |
Total settlement assets (a) |  | $ | 3,419.7 |
Settlement obligations: |  |  |
Money transfer, money order, and payment service payables |  | $ | 2,759.5 |
Payables to agents |  |  | 660.2 |
Total settlement obligations (a) |  | $ | 3,419.7 |
|  | December 31, 2022 |
Settlement assets: |  |  |
Cash and cash equivalents |  | $ | 708.1 |
Receivables from agents, Business Solutions customers, and others |  |  | 1,533.2 |
Less: Allowance for credit losses |  |  | (13.0 | )
Receivables from agents, Business Solutions customers, and others, net |  |  | 1,520.2 |
Investment securities |  |  | 1,333.7 |
Less: Allowance for credit losses |  |  | (0.3 | )
Investment securities, net |  |  | 1,333.4 |
Total settlement assets (a) |  | $ | 3,561.7 |
Settlement obligations: |  |  |
Money transfer, money order, and payment service payables |  | $ | 2,843.3 |
Payables to agents |  |  | 718.4 |
Total settlement obligations (a) |  | $ | 3,561.7 |
(a) Settlement assets and Settlement obligations include Assets held for sale and Liabilities associated with assets held for sale of $91.6 million and $74.9 million as of June 30, 2023 and December 31, 2022, 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, 2023 |  | $ | 11.4 |  |  | $ | 1.6 |
Current period provision for expected credit losses (a) |  |  | (0.4 | ) |  |  | 0.4 |
Write-offs charged against the allowance |  |  | (4.2 | ) |  |  | (0.7 | )
Recoveries of amounts previously written off |  |  | 1.8 |  |  |  | — |
Impacts of foreign currency exchange rates and other |  |  | 0.1 |  |  |  | 0.7 |
Allowance for credit losses as of March 31, 2023 |  |  | 8.7 |  |  |  | 2.0 |
Current period provision for expected credit losses (a) |  |  | 5.3 |  |  |  | 1.0 |
Write-offs charged against the allowance |  |  | (4.1 | ) |  |  | (2.4 | )
Recoveries of amounts previously written off |  |  | 1.4 |  |  |  | — |
Impacts of foreign currency exchange rates and other |  |  | 0.4 |  |  |  | (0.6 | )
Allowance for credit losses as of June 30, 2023 |  | $ | 11.7 |  |  | $ | — |
|  | 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 |
Current period provision for expected credit losses (a) |  |  | 1.8 |  |  |  | 2.1 |
Write-offs charged against the allowance |  |  | (1.3 | ) |  |  | (1.4 | )
Recoveries of amounts previously written off |  |  | 1.0 |  |  |  | — |
Impacts of foreign currency exchange rates and other |  |  | (3.0 | ) |  |  | (0.5 | )
Allowance for credit losses as of June 30, 2022 |  | $ | 16.9 |  |  | $ | 1.7 |
(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 $9.1 million and $6.1 million for the three months ended March 31, 2023 and June 30, 2023, respectively, and $10.0 million and $7.7 million for the three months ended March 31, 2022 and June 30, 2022, respectively.
Components of Investment Securities | The components of investment securities are as follows (in millions):
|  |  |  |  |  |  |  | Gross |  |  | Gross |  |  | Net |
|  | Amortized |  |  | Fair |  |  | Unrealized |  |  | Unrealized |  |  | Unrealized |
June 30, 2023 |  | Cost |  |  | Value |  |  | Gains |  |  | Losses |  |  | Losses |
Settlement assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Money market funds |  | $ | 7.6 |  |  | $ | 7.6 |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Available-for-sale securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
State and municipal debt securities (a) |  |  | 1,085.6 |  |  |  | 1,019.3 |  |  |  | 1.8 |  |  |  | (68.1 | ) |  |  | (66.3 | )
Asset-backed securities |  |  | 191.3 |  |  |  | 190.9 |  |  |  | 0.4 |  |  |  | (0.8 | ) |  |  | (0.4 | )
Corporate debt securities |  |  | 153.7 |  |  |  | 147.5 |  |  |  | 0.3 |  |  |  | (6.5 | ) |  |  | (6.2 | )
State and municipal variable-rate demand notes |  |  | 46.3 |  |  |  | 46.3 |  |  |  | — |  |  |  | — |  |  |  | — |
United States government agency mortgage-backed securities |  |  | 16.8 |  |  |  | 16.0 |  |  |  | — |  |  |  | (0.8 | ) |  |  | (0.8 | )
Total available-for-sale securities |  |  | 1,493.7 |  |  |  | 1,420.0 |  |  |  | 2.5 |  |  |  | (76.2 | ) |  |  | (73.7 | )
Total investment securities |  | $ | 1,501.3 |  |  | $ | 1,427.6 |  |  | $ | 2.5 |  |  | $ | (76.2 | ) |  | $ | (73.7 | )
|  |  |  |  |  |  |  | Gross |  |  | Gross |  |  | Net |
|  | Amortized |  |  | Fair |  |  | Unrealized |  |  | Unrealized |  |  | Unrealized |
December 31, 2022 |  | Cost |  |  | Value |  |  | Gains |  |  | Losses |  |  | Gains/(Losses) |
Settlement assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Money market funds |  | $ | 11.7 |  |  | $ | 11.7 |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Available-for-sale securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
State and municipal debt securities (a) |  |  | 1,010.5 |  |  |  | 933.3 |  |  |  | 0.3 |  |  |  | (77.5 | ) |  |  | (77.2 | )
Asset-backed securities |  |  | 183.4 |  |  |  | 184.1 |  |  |  | 0.8 |  |  |  | (0.1 | ) |  |  | 0.7 |
Corporate debt securities |  |  | 153.5 |  |  |  | 146.9 |  |  |  | 0.3 |  |  |  | (6.9 | ) |  |  | (6.6 | )
State and municipal variable-rate demand notes |  |  | 48.9 |  |  |  | 48.9 |  |  |  | — |  |  |  | — |  |  |  | — |
United States government agency mortgage-backed securities |  |  | 21.5 |  |  |  | 20.5 |  |  |  | — |  |  |  | (1.0 | ) |  |  | (1.0 | )
Total available-for-sale securities |  |  | 1,417.8 |  |  |  | 1,333.7 |  |  |  | 1.4 |  |  |  | (85.5 | ) |  |  | (84.1 | )
Total investment securities |  | $ | 1,429.5 |  |  | $ | 1,345.4 |  |  | $ | 1.4 |  |  | $ | (85.5 | ) |  | $ | (84.1 | )
(a) The majority of these securities are fixed-rate instruments.
Summary of Investment Securities in Unrealized Position | The following summarizes investment securities that were in an unrealized loss position as of June 30, 2023, by the length of time the securities were in a continuous loss position (in millions):
Less Than One Year |  | Number of Securities |  |  | Fair Value |  |  | Unrealized Losses |
State and municipal debt securities |  |  | 111 |  |  | $ | 296.5 |  |  | $ | (5.6 | )
Asset-backed securities |  |  | 28 |  |  |  | 163.8 |  |  |  | (0.8 | )
Corporate debt securities |  |  | 28 |  |  |  | 84.3 |  |  |  | (1.3 | )
United States government agency mortgage-backed securities |  |  | 6 |  |  |  | 5.2 |  |  |  | (0.2 | )
One Year or Greater |  | Number of Securities |  |  | Fair Value |  |  | Unrealized Losses |
State and municipal debt securities |  |  | 267 |  |  | $ | 609.4 |  |  | $ | (62.5 | )
Corporate debt securities |  |  | 11 |  |  |  | 40.5 |  |  |  | (5.2 | )
United States government agency mortgage-backed securities |  |  | 7 |  |  |  | 10.7 |  |  |  | (0.6 | )
Contractual Maturities of Debt Securities | The following summarizes the contractual maturities of available-for-sale securities within Settlement assets as of June 30, 2023 (in millions):
|  | Fair Value |
Due within 1 year |  | $ | 115.9 |
Due after 1 year through 5 years |  |  | 676.8 |
Due after 5 years through 10 years |  |  | 437.6 |
Due after 10 years |  |  | 189.7 |
Total |  | $ | 1,420.0 |

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