5 unchanged sentences
We are exposed to interest-rate risk relating to our investment portfolio and from interest-rate sensitive assets underlying the customer balances we hold on our condensed consolidated balance sheets as customer accounts.
−Removed: As of June 30, 2020 and December 31, 2019, approximately 47% and 63%, respectively, of our total cash, cash equivalents, and investment portfolio (excluding restricted cash and strategic investments) was held in cash and cash equivalents.
+Added: As of September 30, 2020 and December 31, 2019, approximately 40% and 63%, respectively, of our total cash, cash equivalents, and investment portfolio (excluding restricted cash and strategic investments) was held in cash and cash equivalents.
The assets underlying the customer balances which we hold on our condensed consolidated balance sheets as customer accounts are maintained in interest and non-interest bearing bank deposits, time deposits, U.S.
2 unchanged sentences
We do not pay interest on amounts due to customers.
+Added: If interest rates increased by 100 basis points, the fair value of our available-for-sale debt securities investment portfolio would decrease by approximately $104 million and $68 million at September 30, 2020 and December 31, 2019, respectively.
We have $9.0 billion in fixed rate debt with varying maturity dates.
1 unchanged sentence
However, the fair value of these notes fluctuates when interest rates change.
−Removed: We also have various committed credit facilities available to us aggregating to $6.0 billion.
−Removed: We are obligated to pay interest on borrowings under these facilities as well as other customary fees, including an upfront fee and an unused commitment fee based on our debt rating.
−Removed: Borrowings under these facilities, if any, bear interest at floating rates.
+Added: We also have a committed credit facility of $5.0 billion available to us.
+Added: We are obligated to pay interest on borrowings under this facility as well as other customary fees, including an upfront fee and an unused commitment fee based on our debt rating.
+Added: Borrowings under this facility, if any, bear interest at floating rates.
As a result, we are exposed to the risk related to fluctuations in interest rate to the extent of our borrowings.
−Removed: As of both June 30, 2020 and December 31, 2019, we had no amounts outstanding under these credit facilities.
+Added: As of both September 30, 2020 and December 31, 2019, we had no amount outstanding under this credit facility.
For additional information, see “Note 12—Debt” in the notes to the condensed consolidated financial statements in Part I, Item 1 of this Form 10-Q.
1 unchanged sentence
Higher interest rates often lead to higher payment obligations by customers of our credit products to us, or to lenders under mortgage, credit card, and other consumer and merchant loans, which may reduce our customers’ ability to remain current on their obligations to us and therefore lead to increased delinquencies, charge-offs, and allowances for loans and interest receivable, which could have an adverse effect on our net income.
−Removed: A 100 basis point increase in interest rates would not have had a material impact on our financial assets or liabilities at June 30, 2020 and December 31, 2019.
Foreign Currency Exchange Rate Risk
17 unchanged sentences
We considered the historical trends in foreign currency exchange rates and determined that it was reasonably possible that changes in exchange rates of 20% for all currencies could be experienced in the near term.
−Removed: dollar weakened by 20% at June 30, 2020 and December 31, 2019, the amount recorded in AOCI related to our foreign currency exchange forward contracts, before taxes, would have been approximately $736 million and $900 million lower, respectively.
−Removed: dollar strengthened by 20% at June 30, 2020 and December 31, 2019, the amount recorded in AOCI related to our foreign currency exchange forward contracts, before taxes, would have been approximately $736 million and $900 million higher, respectively.
+Added: dollar weakened by 20% at September 30, 2020 and December 31, 2019, the amount recorded in AOCI related to our foreign currency exchange forward contracts, before taxes, would have been approximately $821 million and $900 million lower, respectively.
+Added: dollar strengthened by 20% at September 30, 2020 and December 31, 2019, the amount recorded in AOCI related to our foreign currency exchange forward contracts, before taxes, would have been approximately $821 million and $900 million higher, respectively.
We have an additional foreign currency exchange management program in which we use foreign currency exchange contracts to offset the foreign currency exchange risk on our assets and liabilities denominated in currencies other than the functional currency of our subsidiaries.
1 unchanged sentence
The foreign currency exchange gains and losses on our assets and liabilities are recorded in other income (expense), net, and are offset by the gains and losses on the foreign currency exchange contracts.
−Removed: Adverse changes in exchange rates of 20% for all currencies would have resulted in an adverse impact on income before income taxes of approximately $267 million and $147 million at June 30, 2020 and December 31, 2019, respectively, without considering the offsetting effect of hedging.
−Removed: Foreign currency exchange contracts in place as of June 30, 2020 would have positively impacted income before income taxes by approximately $269 million, resulting in a net positive impact of approximately $2 million.
+Added: Adverse changes in exchange rates of 20% for all currencies would have resulted in an adverse impact on income before income taxes of approximately $278 million and $147 million at September 30, 2020 and December 31, 2019, respectively, without considering the offsetting effect of hedging.
+Added: Foreign currency exchange contracts in place as of September 30, 2020 would have positively impacted income before income taxes by approximately $267 million, resulting in a net negative impact of approximately $11 million.
Foreign currency exchange contracts in place as of December 31, 2019 would have positively impacted income before income taxes by approximately $153 million, resulting in a net positive impact of approximately $6 million.
2 unchanged sentences
Our strategic investments are subject to a variety of market-related risks that could substantially reduce or increase the carrying value of the portfolio.
−Removed: As of June 30, 2020 and December 31, 2019, our strategic investments totaled $2.6 billion and $1.8 billion, respectively, which represented approximately 16% and 13% of our total cash, cash equivalents, and investment portfolio at those respective dates.
+Added: As of September 30, 2020 and December 31, 2019, our strategic investments totaled $2.2 billion and $1.8 billion, respectively, which represented approximately 13% of our total cash, cash equivalents, and investment portfolio at each of those respective dates.
Our strategic investments include marketable equity securities, which are publicly traded, and non-marketable equity securities, which are investments in privately held companies that are not publicly traded.
2 unchanged sentences
These changes could be material based on market conditions.
−Removed: A hypothetical adverse change of 10% in the carrying value of our strategic investments as of June 30, 2020, which could be experienced in the near term, would have resulted in a decrease of approximately $263 million to the carrying value of the portfolio.
+Added: A hypothetical adverse change of 10% in the carrying value of our strategic investments as of September 30, 2020, which could be experienced in the near term, would have resulted in a decrease of approximately $222 million to the carrying value of the portfolio.
We review our non-marketable equity investments accounted for under the Measurement Alternative for impairment when events and circumstances indicate a decline in fair value of such assets below carrying value.
1 unchanged sentence
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.