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Investments | 9 Months Ended
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Jun. 30, 2016
Investments, Debt and Equity Securities [Abstract] |
Investments | Investments The Company’s consolidated investments are summarized as follows:
| June 30, 2016
| Cost or Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value |  | Carrying Value
Asset-based loans | $ | 48.2 |  |  | $ | — |  |  | $ | — |  |  | $ | 48.2 |  |  | $ | 48.2 |
Other invested assets | 2.5 |  |  | — |  |  | — |  |  | 2.5 |  |  | 2.5 |
Total Investments | $ | 50.7 |  |  | $ | — |  |  | $ | — |  |  | $ | 50.7 |  |  | $ | 50.7 |
| September 30, 2015
| (As Adjusted)
| Cost or Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value |  | Carrying Value
Corporate fixed-maturity securities, available-for-sale | $ | 14.1 |  |  | $ | — |  |  | $ | — |  |  | $ | 14.1 |  |  | $ | 14.1 |
Equity securities - held for trading | 18.7 |  |  | 14.1 |  |  | — |  |  | 32.8 |  |  | 32.8 |
Asset-based loans | 226.7 |  |  | — |  |  | — |  |  | 226.7 |  |  | 226.7 |
Other invested assets | 5.3 |  |  | — |  |  | — |  |  | 5.3 |  |  | 5.3 |
Total Investments | $ | 264.8 |  |  | $ | 14.1 |  |  | $ | — |  |  | $ | 278.9 |  |  | $ | 278.9 |
Asset-based Loans As of June 30, 2016 and September 30, 2015, the Company’s portfolio of asset-based loans receivable originated by Salus and its co-lender Front Street consisted of the following:
| June 30, 2016 |  | September 30, 2015
|  |  | (As Adjusted)
Asset-based loans, net of deferred fees, by major industry: |  |  |
Apparel | $ | 34.9 |  |  | $ | 66.0 |
Jewelry | 16.8 |  |  | 36.9 |
Manufacturing | 11.9 |  |  | 32.7 |
Electronics | 5.2 |  |  | 45.9 |
Other | 13.2 |  |  | 93.1 |
Total asset-based loans | 82.0 |  |  | 274.6 |
Less: Allowance for credit losses | 33.8 |  |  | 47.9 |
Total asset-based loans, net | $ | 48.2 |  |  | $ | 226.7 |
The Company establishes its allowance for credit losses through a provision for credit losses based on Salus’ evaluation of the credit quality of its loan portfolio. The following table presents the activity in its allowance for credit losses for the three and nine months ended June 30, 2016 and 2015:
| Three months ended June 30, |  | Nine months ended June 30,
| 2016 |  | 2015 |  | 2016 |  | 2015
Allowance for credit losses: |  |  |  |  |  |  |
Balance at beginning of period | $ | 47.8 |  |  | $ | 22.7 |  |  | $ | 47.9 |  |  | $ | 5.5 |
Provision for credit losses | (11.7 | ) |  | 9.4 |  |  | 2.7 |  |  | 77.7 |
Charge-offs | (5.2 | ) |  | — |  |  | (19.7 | ) |  | (51.1 | )
Recoveries | 2.9 |  |  | — |  |  | 2.9 |  |  | — |
Balance at end of period | $ | 33.8 |  |  | $ | 32.1 |  |  | $ | 33.8 |  |  | $ | 32.1 |
Credit Quality Indicators Salus monitors credit quality as indicated by various factors and utilizes such information in its evaluation of the adequacy of the allowance for credit losses. As of June 30, 2016 and September 30, 2015, there were eleven and nine loans with a net carrying value of $68.4 and $79.8, respectively, considered delinquent by Salus and placed on non-accrual status. It is Salus’ policy to discontinue accruing interest when there is a reasonable doubt as to collectability in the normal course of business. Nonaccrual loans are considered impaired for reporting purposes and are individually evaluated for impairment. During the three and nine months ended June 30, 2016, the Company recognized charge-offs of $5.2 and $19.7, respectively. For the three and nine months ended June 30, 2016, the Company recorded net decreases in the allowance for credit losses of $16.9 and $17.0, respectively, and recoveries of $2.9 for the three and nine months ended June 30, 2016. The internal risk rating of one and seven delinquent loans was categorized as doubtful during the three and nine months ended June 30, 2016, respectively. Salus has assessed the adequacy of its allowance for credit losses and believes the level of allowance for credit losses to be adequate to mitigate inherent losses in the portfolio. During the nine months ended June 30, 2015, the Company recognized charge-offs of $51.1. For the three and nine months ended June 30, 2015, the Company also recorded additional net increases in the provision of credit losses of $9.4 and $26.6, respectively. The internal risk rating of three and four delinquent loan was categorized as doubtful during the three and nine months ended June 30, 2015, respectively. During the fiscal year ended September 30, 2015, the bankruptcy court overseeing the Chapter 11 proceedings of RadioShack Corp. (“RadioShack”) approved the sale of 1,743 of the company’s stores to General Wireless Inc., an affiliate of Standard General LP. Salus was the lender under RadioShack’s $250.0 term loan placed in December 2013 with a net exposure to Salus and Front Street of $93.0 and $7.0, respectively, after giving effect to a $50.0 participation by FGL and a non-qualifying participation of $100.0 held by a third party. During the fiscal year ended September 30, 2015, the $100.0 held by a third party was repaid in full because this third party had the right of first payment in the case of a bankruptcy under an intercreditor agreement with Salus. During the nine months ended June 30, 2015, the Company recognized charge-offs of $51.1, excluding any charge-offs related to FGL’s participations which are included in “(Loss) income from discontinued operations, net of tax” in the accompanying Condensed Consolidated Statements of Operations; and an additional net increase in the provision of credit losses of $19.2 related to the loan with RadioShack. During the three and nine months ended June 30, 2016, Salus and Front Street received a partial repayment on the loan to RadioShack of $43.4, excluding $21.7 repayment on FGL’s participation on the loan. At June 30, 2016, the Company expects additional $5.0 of future recoveries of the loan to RadioShack, excluding $2.5 related to FGL’s participation on the loan that is included in “Assets of business held for sale” in the accompanying Condensed Consolidated Balance Sheets. As a result of the higher than expected recovery rates during the quarter, the Company reversed $18.0 of previously recorded allowance for credit losses, excluding $9.0 of realized gains by FGL recorded in “(Loss) income from discontinued operations, net of tax” in the accompanying Condensed Consolidated Statements of Operations.
| Internal Risk Rating
| Pass |  | Special Mention |  | Substandard |  | Doubtful |  | Total
June 30, 2016 | $ | — |  |  | $ | 1.3 |  |  | $ | 11.2 |  |  | $ | 69.5 |  |  | $ | 82.0 |
September 30, 2015 (As Adjusted) | $ | 69.0 |  |  | $ | 32.4 |  |  | $ | 74.0 |  |  | $ | 99.2 |  |  | $ | 274.6 |

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- Definition The entire disclosure for cash, cash equivalents, investments in debt and equity instruments (including cost and equity investees and related income statement amounts), equity and cost method investments, investments in joint ventures and any other investment. + References No definition available. + Details
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