Table of Contents ADOBE INC.  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The table below represents the preliminary purchase price allocation to the acquired net tangible and intangible assets of Marketo based on their estimated fair values as of the acquisition date and the associated estimated useful lives at that date.
The fair values assigned to assets acquired and liabilities assumed are based on management’s best estimates and assumptions as of the reporting date and are considered preliminary pending finalization of valuation analyses pertaining to intangible assets acquired, deferred revenue and tax liabilities assumed including the calculation of deferred tax assets and liabilities.
## Table 0 ##
(1) Non-deductible for tax-purposes.
Identifiable intangible assets—Customer relationships consist of Marketo’s contractual relationships and customer loyalty related to their enterprise and commercial customers as well as technology partner relationships.
The estimated fair value of the customer contracts and relationships was determined based on projected cash flows attributable to the asset.
Purchased technology acquired primarily consists of Marketo’s cloud-based engagement marketing software platform.
The estimated fair value of the purchased technology was determined based on the expected future cost savings resulting from ownership of the asset.
Backlog relates to subscription contracts and professional services.
Non-compete agreements include agreements with key Marketo employees that preclude them from competing against Marketo for a period of two years from the acquisition date.
Trademarks include the Marketo trade name, which is well known in the marketing ecosystem.
We amortize the fair value of these intangible assets on a straight-line basis over their respective estimated useful lives.
Goodwill—Approximately $3.46 billion has been allocated to goodwill, and has been allocated in full to the Digital Experience reportable segment.
Goodwill represents the excess of the purchase price over the fair value of the underlying acquired net tangible and intangible assets.
The factors that contributed to the recognition of goodwill included securing buyer-specific synergies that increase revenue and profits and are not otherwise available to a marketplace participant, acquiring a talented workforce and cost savings opportunities.
Net liabilities assumed —Marketo’s tangible assets and liabilities as of October 31, 2018 were reviewed and adjusted to their fair value as necessary.
The net liabilities assumed included, among other items, $100.1 million in accrued expenses, $74.8 million in deferred revenue and $182.6 million in deferred tax liabilities, which were partially offset by $54.9 million in cash and cash equivalents and $72.4 million in trade receivables acquired.
Deferred revenue—Included in net liabilities assumed is Marketo’s deferred revenue which represents advance payments from customers related to subscription contracts and professional services.
We estimated our obligation related to the deferred revenue using the cost build-up approach.
The cost build-up approach determines fair value by estimating the direct and indirect costs related to supporting the obligation plus an assumed operating margin.
The sum of the costs and assumed operating profit approximates, in theory, the amount that Marketo would be required to pay a third party to assume the obligation.
The estimated costs to fulfill the obligation were based on the near-term projected cost structure for subscription and professional services.
As a result, we recorded an adjustment to reduce Marketo’s carrying value of deferred revenue to $74.8 million, which represents our estimate of the fair value of the contractual obligations assumed based on a preliminary valuation.
SVB FINANCIAL GROUP AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(Continued) Rent expense for premises and equipment leased under operating leases totaled $11.5 million, $10.7 million and $10.7 million in 2010, 2009 and 2008, respectively.
Commitments to Extend Credit A commitment to extend credit is a formal agreement to lend funds to a client as long as there is no violation of any condition established in the agreement.
Such commitments generally have fixed expiration dates, or other termination clauses, and usually require a fee paid by the client upon us issuing the commitment.
The following table summarizes information related to our commitments to extend credit at December 31, 2010 and 2009, respectively:
## Table 1 ##
(1) Represents commitments which are available for funding, due to clients meeting all collateral, compliance and financial covenants required under loan commitment agreements.
(2) Represents commitments which are currently unavailable for funding, due to clients failing to meet all collateral, compliance and financial covenants under loan commitment agreements.
(3) We extend credit under accounts receivable factoring arrangements when our clients’ sales invoices are deemed creditworthy under existing underwriting practices.
Our potential exposure to credit loss for commitments to extend credit, in the event of nonperformance by the other party to the financial instrument, is the contractual amount of the available unused loan commitment.
We use the same credit approval and monitoring process in extending credit commitments as we do in making loans.
The actual liquidity needs and the credit risk that we have experienced have historically been lower than the contractual amount of commitments to extend credit because a significant portion of these commitments expire without being drawn upon.
We evaluate each potential borrower and the necessary collateral on an individual basis.
The type of collateral varies, but may include real property, intellectual property, bank deposits, or business and personal assets.
The potential credit risk associated with these commitments is considered in management’s evaluation of the adequacy of the reserve for unfunded credit commitments.
Commercial and Standby Letters of Credit Commercial and standby letters of credit represent conditional commitments issued by us on behalf of a client to guarantee the performance of the client to a third party when certain specified future events have occurred.
Commercial letters of credit are issued primarily for inventory purchases by a client and are typically short-term in nature.
We provide two types of standby letters of credit: performance and financial standby letters of credit.
Performance standby letters of credit are issued to guarantee the performance of a client to a third party when certain specified future events have occurred and are primarily used to support performance instruments such as bid bonds, performance bonds, lease obligations, repayment of loans, and past due notices.
Financial standby letters of credit are conditional commitments issued by us to guarantee the payment by a client to a third
Table of Contents SVB FINANCIAL GROUP AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(Continued) 20.
Regulatory Matters The Company and the Bank are subject to various regulatory capital adequacy requirements administered by the Federal Reserve Board and the California Department of Financial Institutions (“DFI”).
The Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”) required that the federal regulatory agencies adopt regulations defining five capital tiers for banks: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized and critically undercapitalized.
Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on our consolidated financial statements.
Quantitative measures, established by the regulators to ensure capital adequacy, require that SVB Financial Group and the Bank maintain minimum ratios (set forth in the table below) of capital to risk-weighted assets.
There are three categories of capital under the guidelines.
Tier 1 capital includes common stockholders’ equity, qualifying preferred stock and trust preferred securities, less goodwill and certain other deductions (including the unrealized net gains and losses, after applicable taxes, on securities available-for-sale carried at fair value).
Tier 1 capital must comprise at least half of total capital.
Components of Tier 2 capital include preferred stock not qualifying as Tier 1 capital, subordinated debt, the allowance for credit losses and net unrealized gains on available-for-sale securities, subject to limitations by the guidelines.
Tier 3 capital includes certain qualifying unsecured subordinated debt.
We did not have any Tier 3 capital as of December 31, 2010 and December 31, 2009.
Under these capital guidelines, being considered a “well capitalized” institution requires SVB Financial and the Bank to maintain minimum total risk-based capital and Tier 1 risk-based capital ratios of ten percent and six percent, respectively.
The Federal Reserve Board has also established minimum capital leverage ratio guidelines for state member banks.
The ratio is determined using Tier 1 capital divided by quarterly average total assets.
The guidelines require a minimum of five percent to remain classified as a “well-capitalized” depository institution.
The most recent joint notification from the DFI and the Federal Reserve Board categorized the Bank as well-capitalized under the FDICIA prompt corrective action provisions applicable to banks.
There are no conditions or events since that notification that management believes have changed the Bank’s category.
The following table presents the capital ratios for the Company and the Bank under federal regulatory guidelines, compared to the minimum regulatory capital requirements for an adequately capitalized depository institution, as of December 31, 2010 and 2009:
## Table 2 ##
making decisions and assessing performance as the source of our reporting segments.
Please refer to Note 21- “Segment Reporting” of the “Notes to Consolidated Financial Statements” under Part II, Item 8 of this report for further details.
Our operating segments’ primary source of revenue is from net interest income, which is primarily the difference between interest earned on loans, net of funds transfer pricing (“FTP”), and interest paid on deposits, net of FTP.
Accordingly, our segments are reported using net interest income, net of FTP.
FTP is an internal measurement framework designed to assess the financial impact of a financial institution’s sources and uses of funds.
It is the mechanism by which an earnings credit is given for deposits raised, and an earnings charge is made for funded loans.
FTP is calculated by applying a transfer rate to pooled, or aggregated, loan and deposit volumes.
We also evaluate performance based on provision for loan losses, noninterest income and noninterest expense, which are presented as components of segment operating profit or loss.
In calculating each operating segment’s noninterest expense, we consider the direct costs incurred by the operating segment as well as certain allocated direct costs.
As part of this review, we allocate certain corporate overhead costs to a corporate account.
We do not allocate income taxes to our segments.
Additionally, our management reporting model is predicated on average asset balances; therefore, period-end asset balances are not presented for segment reporting purposes.
Changes in an individual client’s primary relationship designation have resulted, and in the future may result, in the inclusion of certain clients in different segments in different periods.
The following is our segment information for 2010, 2009 and 2008, respectively.
Global Commercial Bank
## Table 3 ##
2010 compared to 2009 Net interest income from our Global Commercial Bank (“GCB”) decreased by $13.5 million in 2010, primarily due a decrease in loan interest income of $15.9 million resulting primarily from a decrease in average loan balances, and a decrease in the FTP earned for deposits of $44.8 million due to decreases in market interest rates.
These decreases were partially offset by an increase in the FTP earned for deposits of $36.7 million due to significant deposit growth, as well as a decrease in interest expense from deposits of $6.6 million resulting primarily from decreases in our deposit rates.
The provision for loan losses for GCB was $39.3 million in 2010, a decrease of $36.7 million from 2009.
The decrease was primarily due a decrease in net charge-offs as a result of an overall improvement in our credit quality.
The provision for loan losses of $39.3 million in 2010 was primarily attributable to gross loan charge-offs from our life science, software and hardware client portfolios, partially offset by loan recoveries primarily from our software, hardware and life science client portfolios.
Table of Contents Credit Quality and Allowance for Loan Losses The following table presents a summary of the activity for the allowance for loan losses as of the five most recent year-ends:
## Table 4 ##
The following table summarizes the allocation of the allowance for loan losses among specific classes of loans as of the five most recent year-ends:
## Table 5 ##
Represents loan category as a percentage of total gross loans as of year end.

<table><tr><td>(in thousands)</td><td>Amount</td><td>Weighted Average Useful Life (years)</td></tr><tr><td>Customer contracts and relationships</td><td>$576,900</td><td>11</td></tr><tr><td>Purchased technology</td><td>444,500</td><td>7</td></tr><tr><td>Backlog</td><td>105,800</td><td>2</td></tr><tr><td>Non-competition agreements</td><td>12,100</td><td>2</td></tr><tr><td>Trademarks</td><td>328,500</td><td>9</td></tr><tr><td>Total identifiable intangible assets</td><td>1,467,800</td><td></td></tr><tr><td>Net liabilities assumed</td><td>-191,288</td><td>N/A</td></tr><tr><td>Goodwill<sup>-1</sup></td><td>3,459,751</td><td>N/A</td></tr><tr><td>Total estimated purchase price</td><td>$4,736,263</td><td></td></tr></table>
<table><tr><td></td><td colspan="2"> December 31,</td></tr><tr><td> (Dollars in thousands)</td><td> 2010</td><td> 2009</td></tr><tr><td>Commitments available for funding: -1</td><td></td><td></td></tr><tr><td>Fixed interest rate commitments</td><td>$386,055</td><td>$539,986</td></tr><tr><td>Variable interest rate commitments</td><td>5,884,450</td><td>4,798,740</td></tr><tr><td>Total commitments available for funding</td><td>$6,270,505</td><td>$5,338,726</td></tr><tr><td>Commitments unavailable for funding -2</td><td>$963,847</td><td>$1,103,489</td></tr><tr><td>Maximum lending limits for accounts receivable factoring arrangements -3</td><td>697,702</td><td>535,257</td></tr><tr><td>Reserve for unfunded credit commitments</td><td>17,414</td><td>13,331</td></tr></table>
<table><tr><td> (Dollars in thousands)</td><td>Actual Ratio</td><td> Actual Amount</td><td>Capital Adequacy Minimum Ratio</td><td> Capital Adequacy Minimum Capital Requirement</td></tr><tr><td> December 31, 2010:</td><td></td><td></td><td></td><td></td></tr><tr><td>Total risk-based capital ratio:</td><td></td><td></td><td></td><td></td></tr><tr><td>SVB Financial</td><td>17.35%</td><td>$1,632,469</td><td>8.0%</td><td>$752,534</td></tr><tr><td>Bank</td><td>15.48</td><td>1,400,256</td><td>8.0</td><td>723,832</td></tr><tr><td>Tier 1 risk-based capital ratio:</td><td></td><td></td><td></td><td></td></tr><tr><td>SVB Financial</td><td>13.63</td><td>1,282,417</td><td>4.0</td><td>376,267</td></tr><tr><td>Bank</td><td>11.61</td><td>1,050,745</td><td>4.0</td><td>361,916</td></tr><tr><td>Tier 1 leverage ratio:</td><td></td><td></td><td></td><td></td></tr><tr><td>SVB Financial</td><td>7.96</td><td>1,282,417</td><td>4.0</td><td>644,041</td></tr><tr><td>Bank</td><td>6.82</td><td>1,050,745</td><td>4.0</td><td>615,992</td></tr></table>
<table><tr><td></td><td colspan="5">Year ended December 31,</td></tr><tr><td> (Dollars in thousands)</td><td>2010</td><td>2009</td><td>% Change 2010/2009</td><td>2008</td><td>% Change 2009/2008</td></tr><tr><td>Net interest income</td><td>$346,858</td><td>$360,391</td><td>-3.8%</td><td>$332,807</td><td>8.3%</td></tr><tr><td>Provision for loan losses</td><td>-39,285</td><td>-76,011</td><td>-48.3</td><td>-85,238</td><td>-10.8</td></tr><tr><td>Noninterest income</td><td>121,980</td><td>108,307</td><td>12.6</td><td>133,264</td><td>-18.7</td></tr><tr><td>Noninterest expense</td><td>-235,295</td><td>-181,814</td><td>29.4</td><td>-153,470</td><td>18.5</td></tr><tr><td>Income before income tax expense</td><td>$194,258</td><td>$210,873</td><td>-7.9</td><td>$227,363</td><td>-7.3</td></tr><tr><td>Total average loans</td><td>$3,444,496</td><td>$3,714,886</td><td>-7.3</td><td>$3,663,646</td><td>1.4</td></tr><tr><td>Total average assets</td><td>3,715,739</td><td>3,850,762</td><td>-3.5</td><td>3,747,617</td><td>2.8</td></tr><tr><td>Total average deposits</td><td>11,847,355</td><td>8,619,077</td><td>37.5</td><td>4,714,291</td><td>82.8</td></tr></table>
<table><tr><td></td><td colspan="5">Year ended December 31,</td></tr><tr><td> (Dollars in thousands)</td><td>2010</td><td>2009</td><td>2008</td><td>2007</td><td>2006</td></tr><tr><td>Balance, beginning of year</td><td>$72,450</td><td>$107,396</td><td>$47,293</td><td>$42,747</td><td>$36,785</td></tr><tr><td>Charge-offs:</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Commercial loans:</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Software</td><td>-16,230</td><td>-38,869</td><td>-26,702</td><td>-12,088</td><td>-4,418</td></tr><tr><td>Hardware</td><td>-10,568</td><td>-58,261</td><td>-8,077</td><td>-6,044</td><td>-9,430</td></tr><tr><td>Venture capital/private equity</td><td>—</td><td>-10,635</td><td>—</td><td>-326</td><td>—</td></tr><tr><td>Life science</td><td>-17,629</td><td>-16,853</td><td>-2,725</td><td>-787</td><td>—</td></tr><tr><td>Premium wine</td><td>-1,457</td><td>-3,107</td><td>-309</td><td>-4</td><td>-18</td></tr><tr><td>Other</td><td>-4,866</td><td>-2,245</td><td>-2,326</td><td>-29</td><td>—</td></tr><tr><td>Total commercial loans</td><td>-50,750</td><td>-129,970</td><td>-40,139</td><td>-19,278</td><td>-13,866</td></tr><tr><td>Consumer loans</td><td>-489</td><td>-13,600</td><td>-7,676</td><td>-100</td><td>-199</td></tr><tr><td>Total charge-offs</td><td>-51,239</td><td>-143,570</td><td>-47,815</td><td>-19,378</td><td>-14,065</td></tr><tr><td>Recoveries:</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Commercial loans:</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Software</td><td>5,838</td><td>2,284</td><td>3,931</td><td>3,253</td><td>1,637</td></tr><tr><td>Hardware</td><td>5,715</td><td>12,645</td><td>2,441</td><td>3,377</td><td>2,497</td></tr><tr><td>Venture capital/private equity</td><td>—</td><td>—</td><td>294</td><td>28</td><td>—</td></tr><tr><td>Life science</td><td>3,738</td><td>2,708</td><td>252</td><td>11</td><td>1,150</td></tr><tr><td>Premium wine</td><td>222</td><td>55</td><td>170</td><td>66</td><td>1,415</td></tr><tr><td>Other</td><td>737</td><td>413</td><td>113</td><td>353</td><td>3,359</td></tr><tr><td>Total commercial loans</td><td>16,250</td><td>18,105</td><td>7,201</td><td>7,088</td><td>10,058</td></tr><tr><td>Consumer loans</td><td>538</td><td>339</td><td>4</td><td>—</td><td>92</td></tr><tr><td>Total recoveries</td><td>16,788</td><td>18,444</td><td>7,205</td><td>7,088</td><td>10,150</td></tr><tr><td>Provision for loan losses</td><td>44,628</td><td>90,180</td><td>100,713</td><td>16,836</td><td>9,877</td></tr><tr><td>Balance, end of year</td><td>$82,627</td><td>$72,450</td><td>$107,396</td><td>$47,293</td><td>$42,747</td></tr></table>
<table><tr><td></td><td colspan="10"> December 31,</td></tr><tr><td></td><td colspan="2">2010</td><td colspan="2">2009</td><td colspan="2">2008</td><td colspan="2">2007</td><td colspan="2"> 2006</td></tr><tr><td> (Dollars in thousands)</td><td> Amount</td><td>Percent of Total Loans -1</td><td> Amount</td><td>Percent of Total Loans -1</td><td> Amount</td><td>Percent of Total Loans -1</td><td> Amount</td><td>Percent of Total Loans -1</td><td> Amount</td><td> Percent of Total Loans -1</td></tr><tr><td>Commercial loans:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Software</td><td>$29,288</td><td>33.0%</td><td>$24,209</td><td>30.4%</td><td>$29,007</td><td>31.4%</td><td>$16,155</td><td>31.6%</td><td>$17,596</td><td>28.8%</td></tr><tr><td>Hardware</td><td>14,688</td><td>11.6</td><td>16,194</td><td>13.2</td><td>21,604</td><td>16.7</td><td>12,826</td><td>15.0</td><td>16,753</td><td>22.2</td></tr><tr><td>Venture capital/private equity</td><td>8,241</td><td>18.8</td><td>5,664</td><td>20.4</td><td>30,540</td><td>19.2</td><td>7,200</td><td>18.5</td><td>2,736</td><td>13.7</td></tr><tr><td>Life science</td><td>9,077</td><td>10.5</td><td>9,651</td><td>11.4</td><td>7,989</td><td>10.8</td><td>3,370</td><td>9.8</td><td>2,960</td><td>10.0</td></tr><tr><td>Premium wine</td><td>5,492</td><td>8.2</td><td>4,652</td><td>9.7</td><td>4,094</td><td>7.6</td><td>3,358</td><td>9.0</td><td>724</td><td>10.7</td></tr><tr><td>Other</td><td>5,318</td><td>7.9</td><td>3,877</td><td>5.3</td><td>3,717</td><td>4.9</td><td>2,289</td><td>6.5</td><td>1,139</td><td>4.7</td></tr><tr><td>Total commercial loans</td><td>72,104</td><td>90.0</td><td>64,247</td><td>90.4</td><td>96,951</td><td>90.6</td><td>45,198</td><td>90.4</td><td>41,908</td><td>90.1</td></tr><tr><td>Consumer loans</td><td>10,523</td><td>10.0</td><td>8,203</td><td>9.6</td><td>10,445</td><td>9.4</td><td>2,095</td><td>9.6</td><td>839</td><td>9.9</td></tr><tr><td>Total</td><td>$82,627</td><td>100.0%</td><td>$72,450</td><td>100.0%</td><td>$107,396</td><td>100.0%</td><td>$47,293</td><td>100.0%</td><td>$42,747</td><td>100.0%</td></tr></table>

Question: What's the current increasing rate of Balance, beginning of year?
Answer: -0.32539