Shareholders' Equity

12 Months Ended

Dec. 31, 2019

NOTE 15—SHAREHOLDERS' EQUITY

Preferred Stock

The following table presents the preferred stock outstanding (in millions except total shares outstanding and per share data):



						Carrying Value at December 31,
Description	Issuance Date	Per Annum Dividend Rate	Total Shares Outstanding	Liquidation Preference per Share		2019		2018
Series A
Fixed-to-Floating Rate Non-Cumulative	8/25/2016	5.875% to, but excluding, 9/15/2026; 3-mo LIBOR + 4.435% thereafter	400,000	$	1,000	$	394	$	394
Series B
Fixed-to-Floating Rate Non-Cumulative	12/6/2017	5.30% to, but excluding, 3/15/2023; 3-mo LIBOR + 3.16% thereafter	3,000	$	100,000	295		295
Total			403,000			$	689	$	689

Dividend on Preferred Stock

The following table presents the cash dividends paid on preferred stock (in millions except per share data):



Year Ended December 31, 2019
Declaration Date	Record Date	Payment Date	Dividend per Share		Dividend Paid
Series A ⁽¹⁾
2/7/2019	2/28/2019	3/15/2019	$	29.38	$	12
7/25/2019	8/30/2019	9/16/2019	$	29.38	12
Series B ⁽¹⁾
2/7/2019	2/28/2019	3/15/2019	$	2,650.00	8
7/25/2019	8/30/2019	9/16/2019	$	2,650.00	8
Total					$	40

Year Ended December 31, 2018
Declaration Date	Record Date	Payment Date	Dividend per Share		Dividend Paid
Series A ⁽¹⁾
2/8/2018	2/28/2018	3/15/2018	$	29.38	$	12
7/26/2018	8/31/2018	9/17/2018	$	29.38	12
Series B ⁽¹⁾
7/26/2018	8/31/2018	9/17/2018	$	4,107.50	12
Total					$	36

Year Ended December 31, 2017
Declaration Date	Record Date	Payment Date	Dividend per Share		Dividend Paid
Series A ⁽¹⁾
2/2/2017	2/28/2017	3/15/2017	$	32.64	$	13
8/2/2017	8/31/2017	9/15/2017	$	29.38	12
Total					$	25


(1)	Dividends are non-cumulative and payable semi-annually, if declared.

On February 6, 2020, the Company declared a cash dividend of $29.38 per share on its Series A Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock and $2,650.00 per share (equivalent to $26.50 per depository share) on its Series B Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock. The dividends are payable on March 16, 2020, to shareholders of record as of the close of business on March 2, 2020.

Common Stock

Dividend on Common Stock

The following table presents the cash dividends paid on common stock (in millions except per share data):



Year Ended December 31, 2019
Declaration Date	Record Date	Payment Date	Dividend per Share		Dividend Paid
1/23/2019	2/1/2019	2/15/2019	$	0.14	$	35
4/16/2019	5/13/2019	5/20/2019	$	0.14	34
7/17/2019	8/19/2019	8/26/2019	$	0.14	34
10/16/2019	11/8/2019	11/15/2019	$	0.14	32
Total					$	135

Year Ended December 31, 2018
Declaration Date	Record Date	Payment Date	Dividend per Share		Dividend Paid
10/17/2018	10/30/2018	11/15/2018	$	0.14	$	36
Total					$	36

On January 22, 2020, the Company declared a cash dividend for the first quarter of $0.14 per share on its outstanding shares of common stock. The dividend will be payable on March 2, 2020 to shareholders of record as of the close of business on February 25, 2020.

Share Repurchases

In October 2018, the Company announced that its board of directors authorized the repurchase of up to $1 billion of shares of its common stock. During 2019, the Company completed this $1 billion share repurchase program with the repurchase of 10.8 million shares of common stock at an average price of $46.18 per share, or $499 million during the year. In July 2019, the Company announced that its board of directors authorized a new $1.5 billion share repurchase program. As of December 31, 2019, the Company had repurchased 14.0 million shares of common stock at an average price of $41.97 per share, or $586 million under the new program. In total, we utilized $1.1 billion to repurchase 24.8 million shares at an average price of $43.81 under these programs during the year ended December 31, 2019. The Company accounts for share repurchases retired after repurchase by allocating the excess repurchase price over par to additional paid-in-capital.

Other Common Stock Activity

Other common stock activity includes shares withheld to pay taxes for share-based compensation, employee stock purchase plan and other activity. During the year ended December 31, 2017, it also includes a $3 million conversion of the Company's convertible debentures into 0.3 million shares of common stock. There were no conversions of convertible debentures during the years ended December 31, 2018 and 2019.

Accumulated Other Comprehensive Loss

The following tables present after-tax changes in each component of accumulated other comprehensive loss (dollars in millions):



	2019			2018
Accumulated other comprehensive loss, beginning of period⁽¹⁾	$	(275	)	$	(26	)
Other comprehensive income (loss) before reclassifications	224			(203		)
Amounts reclassified from accumulated other comprehensive loss	23			(31		)
Transfer of held-to-maturity securities to available-for-sale securities⁽²⁾	—			6
Net change	247			(228		)
Cumulative effect of hedge accounting adoption	—			(7		)
Reclassification of tax effects due to federal tax reform	—			(14		)
Accumulated other comprehensive loss, end of period⁽¹⁾⁽³⁾	$	(28	)	(275		)


(1)	The accumulated other comprehensive loss balances and activities were related to available-for-sale securities in both periods.


(2)	Securities with a carrying value of $4.7 billion and related unrealized pre-tax gain of $7 million, or $6 million net of tax, were transferred from held-to-maturity securities to available-for-sale securities during the year ended December 31, 2018, as part of a one-time transition election for early adopting the new derivatives and hedge accounting guidance.


(3)	Includes unamortized unrealized pre-tax losses of $21 million at December 31, 2019 of which $1 million and $14 million are related to the transfer of available-for-sale securities to held-to-maturity securities during the years ended December 31, 2019 and 2018, respectively.



	Available-for-Sale Securities			Foreign Currency Translation			Total
Balance, December 31, 2016	$	(139	)	$	2		$	(137	)
Other comprehensive income before reclassifications	137			—			137
Amounts reclassified from accumulated other comprehensive loss	(24		)	(2		)	(26		)
Net change	113			(2		)	111
Balance, December 31, 2017	$	(26	)	$	—		$	(26	)

The following table presents other comprehensive income (loss) activity and the related tax effect (dollars in millions):



	Year Ended December 31,
	2019							2018									2017
	Before Tax		Tax Effect			After Tax		Before Tax			Tax Effect			After Tax			Before Tax			Tax Effect			After Tax
Other comprehensive income (loss)
Available-for-sale securities:
Unrealized gains (losses), net	$	300	$	(76	)	$	224	$	(272	)	$	69		$	(203	)	$	213		$	(76	)	$	137
Reclassification into earnings, net	32		(9		)	23		(42		)	11			(31		)	(39		)	15			(24		)
Transfer of held-to-maturity securities to available-for-sale securities	—		—			—		7			(1		)	6			—			—			—
Net change from available-for-sale securities	332		(85		)	247		(307		)	79			(228		)	174			(61		)	113
Reclassification of foreign currency translation into earnings, net	—		—			—		—			—			—			(2		)	—			(2		)
Other comprehensive income (loss)	$	332	$	(85	)	$	247	$	(307	)	$	79		$	(228	)	$	172		$	(61	)	$	111

The following table presents the consolidated statements of income line items impacted by reclassifications out of accumulated other comprehensive loss (dollars in millions):



Accumulated Other Comprehensive Loss Components	Amounts Reclassified from Accumulated Other Comprehensive Loss									Affected Line Items in the Consolidated Statements of Income
	Year Ended December 31,
	2019			2018			2017
Available-for-sale securities:	$	(29	)	$	45		$	39		Gains (losses) on securities and other, net
	(3		)	(3		)	—			Interest income
	(32		)	42			39			Reclassification into earnings, before tax
	9			(11		)	(15		)	Income tax benefit (expense)
	$	(23	)	$	31		$	24		Reclassification into earnings, net

Foreign currency translation:	$	—		$	—		$	2		Other non-interest expenses
	$	—		$	—		$	2		Reclassification into earnings, net