REDEMPTION SETTLEMENT ASSETS, RESTRICTED

9 Months Ended

Sep. 30, 2021

REDEMPTION SETTLEMENT ASSETS, RESTRICTED.

REDEMPTION SETTLEMENT ASSETS, RESTRICTED

6. REDEMPTION SETTLEMENT ASSETS, RESTRICTED

Redemption settlement assets consist of restricted cash, mutual funds, and securities available-for-sale and are designated for settling redemptions by collectors of the AIR MILES Reward Program in Canada under certain contractual relationships with sponsors of the AIR MILES Reward Program. The principal components of redemption settlement assets, which are carried at fair value, are as follows:


		September 30,			December 31,
		2021			2020
		Fair Value			Fair Value

		(in thousands)
Restricted cash		$	58,196		$	55,427
Mutual funds			26,220			26,850
Corporate bonds			649,536			611,184
Total		$	733,952		$	693,461

The following table shows the amortized cost, unrealized gains and losses, and fair value of securities available-for-sale as of September 30, 2021 and December 31, 2020, respectively:


		September 30, 2021												December 31, 2020
		Amortized			Unrealized			Unrealized						Amortized			Unrealized			Unrealized
		Cost			Gains			Losses			Fair Value			Cost			Gains			Losses			Fair Value

		(in thousands)
Corporate bonds		$	641,820		$	10,257		$	(2,541)		$	649,536		$	592,247		$	19,110		$	(173)		$	611,184
Total		$	641,820		$	10,257		$	(2,541)		$	649,536		$	592,247		$	19,110		$	(173)		$	611,184

The following tables show the unrealized losses and fair value for those investments that were in an unrealized loss position as of September 30, 2021 and December 31, 2020, respectively, aggregated by investment category and the length of time that individual securities have been in a continuous loss position:


		September 30, 2021
		Less than 12 months						12 Months or Greater						Total
					Unrealized						Unrealized						Unrealized
		Fair Value			Losses			Fair Value			Losses			Fair Value			Losses

		(in thousands)
Corporate bonds		$	178,215		$	(2,367)		$	14,224		$	(174)		$	192,439		$	(2,541)
Total		$	178,215		$	(2,367)		$	14,224		$	(174)		$	192,439		$	(2,541)


		December 31, 2020
		Less than 12 months						12 Months or Greater						Total
					Unrealized						Unrealized						Unrealized
		Fair Value			Losses			Fair Value			Losses			Fair Value			Losses

		(in thousands)
Corporate bonds		$	46,190		$	(86)		$	10,316		$	(87)		$	56,506		$	(173)
Total		$	46,190		$	(86)		$	10,316		$	(87)		$	56,506		$	(173)

The amortized cost and estimated fair value of the securities available-for-sale at September 30, 2021 by contractual maturity are as follows:


		Amortized			Estimated
		Cost			Fair Value

		(in thousands)
Due in one year or less		$	131,884		$	132,984
Due after one year through five years			505,989			512,567
Due after five years through ten years			3,947			3,985
Total		$	641,820		$	649,536

Market values were determined for each individual security in the investment portfolio. The Company recorded losses associated with the change in fair value of mutual funds of $0.6 million for the nine months ended September 30, 2021. Losses associated with the change in fair value of mutual funds for the three months ended September 30, 2021 were de minimis. The Company recorded gains associated with the change in fair value of mutual funds of $0.3 million and $1.0 million for the three and nine months ended September 30, 2020, respectively.

For available-for-sale debt securities in which fair value is less than cost, ASC 326 requires that credit-related impairment, if any, is recognized through an allowance for credit losses and adjusted each period for changes in credit risk. The Company typically invests in highly-rated securities with low probabilities of default and has the intent and ability to hold the investments until maturity, and the Company performs an assessment each period for credit-related impairment. As of September 30, 2021, the Company does not consider its investments to be impaired.

Losses from the sale of investment securities were $0.2 million for the nine months ended September 30, 2021. There were no realized gains or losses from the sale of investment securities for the three months ended September 30, 2021 and the three and nine months ended September 30, 2020.