Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2011

Fair Value Measurements (Tables) [Abstract]

Valuation of financial instruments that are marked-to-market on a recurring basis

	Fair Value Measurements on a Recurring											Fair Value Measurements on a Recurring
	Basis as of June 30, 2011											Basis as of December 31, 2010
(Dollars in millions)	Level 1		Level 2			Level 3			Total			Level 1			Level 2			Level 3			Total
Assets
Available-for-sale investments:
U.S. Treasury securities	$	20	$	—		$	—		$	20		$	39		$	—		$	—		$	39
Agency residential mortgage backed securities		—		64			—			64			—			68			—			68
Guaranteed investment contracts		—		21			—			21			—			20			—			20
Other		—		12			—			12			—			12			—			12
Total available-for-sale investments		20		97			—			117			39			100			—			139
Derivative instruments:(1)
Interest rate swaps		—		1,011			119			1,130			—			1,017			150			1,167
Cross currency interest rate swaps		—		447			2,421			2,868			—			427			1,599			2,026
Other		—		—			3			3			—			—			26			26
Total derivative assets		—		1,458			2,543			4,001			—			1,444			1,775			3,219
Counterparty netting										(858	)											(782	)
Subtotal(3)										3,143												2,437
Cash collateral held										(1,003	)											(886	)
Net derivative assets										2,140												1,551
Total	$	20	$	1,555		$	2,543		$	2,257		$	39		$	1,544		$	1,775		$	1,690
Liabilities(2)
Derivative instruments(1)
Interest rate swaps	$	—	$	(135	)	$	(199	)	$	(334	)	$	—		$	(183	)	$	(240	)	$	(423	)
Floor Income Contracts		—		(2,390	)		—			(2,390	)		—			(1,315	)		—			(1,315	)
Cross currency interest rate swaps		—		(37	)		(148	)		(185	)		—			(43	)		(172	)		(215	)
Other		—		—			—			—			(1	)		—			—			(1	)
Total derivative instruments		—		(2,562	)		(347	)		(2,909	)		(1	)		(1,541	)		(412	)		(1,954	)
Counterparty netting										858												782
Subtotal(3)										(2,051	)											(1,172	)
Cash collateral pledged										993												809
Net derivative liabilities										(1,058	)											(363	)
Total	$	—	$	(2,562	)	$	(347	)	$	(1,058	)	$	(1	)	$	(1,541	)	$	(412	)	$	(363	)

(1)	Fair value of derivative instruments excludes accrued interest and the value of collateral.
(2)	Borrowings which are the hedged items in a fair value hedge relationship and which are adjusted for changes in value due to benchmark interest rates only are not carried at full fair value and are not reflected in this table.
(3)	As carried on the balance sheet.

Change in balance sheet carrying value associated with Level 3 financial instruments carried at fair value on a recurring basis

	Three Months Ended June 30, 2011(3)												Three Months Ended June 30, 2010(3)
	Derivative Instruments												Derivative Instruments
				Cross												Cross
				Currency						Total						Currency						Total
	Interest			Interest						Derivative			Interest			Interest						Derivative
(Dollars in millions)	Rate Swaps			Rate Swaps			Other			Instruments			Rate Swaps			Rate Swaps			Other			Instruments
Balance, beginning of period	$	(85	)	$	2,011		$	26		$	1,952		$	(329	)	$	1,548		$	(22	)	$	1,197
Total gains/(losses) (realized and unrealized):
Included in earnings(1)		6			321			33			360			165			(1,086	)		11			(910	)
Included in other comprehensive income		—			—			—			—			—			—			—			—
Settlements		(1	)		(59	)		(56	)		(116	)		2			(39	)		2			(35	)
Transfers in and/or out of Level 3		—			—			—			—			—			—			—			—
Balance, end of period	$	(80	)	$	2,273		$	3		$	2,196		$	(162	)	$	423		$	(9	)	$	252
Change in unrealized gains/(losses) relating to instruments still held at the reporting date(2)	$	5		$	262		$	14		$	281		$	161		$	(1,125	)	$	12		$	(952	)

	Six Months Ended June 30, 2011(3)
	Derivative Instruments
				Cross
				Currency						Total
	Interest			Interest						Derivative
(Dollars in millions)	Rate Swaps			Rate Swaps			Other			Instruments
Balance, beginning of period	$	(90	)	$	1,427		$	26		$	1,363
Total gains/(losses) (realized and unrealized):
Included in earnings(1)		34			954			35			1,023
Included in other comprehensive income		—			—			—			—
Settlements		(24	)		(108	)		(58	)		(190	)
Transfers in and/or out of Level 3		—			—			—			—
Balance, end of period	$	(80	)	$	2,273		$	3		$	2,196
Change in unrealized gains/(losses) relating to instruments still held at the reporting date(2)	$	10		$	844		$	13		$	867

	Six Months Ended June 30, 2010
				Derivative Instruments
										Cross
										Currency						Total
	Residual			Interest			Floor Income			Interest						Derivative
(Dollars in millions)	Interests			Rate Swaps			Contracts			Rate Swaps			Other			Instruments			Total
Balance, beginning of period	$	1,828		$	(272	)	$	(54	)	$	1,596		$	(18	)	$	1,252		$	3,080
Total gains/(losses) (realized and unrealized):
Included in earnings(1)		—			160			3			(1,959	)		4			(1,792	)		(1,792	)
Included in other comprehensive income		—			—			—			—			—			—			—
Settlements		—			6			51			(87	)		5			(25	)		(25	)
Cumulative effect of accounting change(3)		(1,828	)		(56	)		—			873			—			817			(1,011	)
Transfers in and/or out of Level 3		—			—			—			—			—			—			—
Balance, end of period	$	—		$	(162	)	$	—		$	423		$	(9	)	$	252		$	252
Change in unrealized gains/(losses) relating to instruments still held at the reporting date(2)	$	—		$	161		$	—		$	(2,047	)	$	6		$	(1,880	)	$	(1,880	)

     ⁽¹⁾ “Included in earnings” comprises the following amounts recorded in the specified line item in the consolidated statements of income:

Included in earnings

	Three Months Ended					Six Months Ended
	June 30,					June 30,
(Dollars in millions)	2011		2010			2011		2010
Gains (losses) on derivative and hedging activities, net	$	303	$	(948	)	$	916	$	(1,876	)
Interest expense		57		38			107		84
Total	$	360	$	(910	)	$	1,023	$	(1,792	)

(2)	Recorded in “gains (losses) on derivative and hedging activities, net” in the consolidated statements of income.
(3)	Upon adoption of new consolidation accounting guidance on January 1, 2010, we consolidated previously off-balance sheet securitization trusts. This resulted in the removal of the Residual Interests and the recording of the fair value of swaps previously not in our consolidated results.

Fair values of financial assets and liabilities, including derivative financial instruments

	June 30, 2011									December 31, 2010
	Fair			Carrying						Fair			Carrying
(Dollars in millions)	Value			Value			Difference			Value			Value			Difference
Earning assets
FFELP loans	$	140,341		$	142,635		$	(2,294	)	$	147,163		$	148,649		$	(1,486	)
Private Education Loans		33,086			35,753			(2,667	)		30,949			35,656			(4,707	)
Other loans (presented in “other assets” on the balance sheet)		84			232			(148	)		88			270			(182	)
Cash and investments(1)		11,359			11,359			—			11,553			11,553			—
Total earning assets		184,870			189,979			(5,109	)		189,753			196,128			(6,375	)
Interest-bearing liabilities
Short-term borrowings		30,748			30,766			18			33,604			33,616			12
Long-term borrowings		151,843			160,765			8,922			154,355			163,544			9,189
Total interest-bearing liabilities		182,591			191,531			8,940			187,959			197,160			9,201
Derivative financial instruments
Floor Income/Cap contracts		(2,390	)		(2,390	)		—			(1,315	)		(1,315	)		—
Interest rate swaps		796			796			—			744			744			—
Cross currency interest rate swaps		2,683			2,683			—			1,811			1,811			—
Other		3			3			—			25			25			—
Excess of net asset fair value over carrying value							$	3,831								$	2,826

(1) “Cash and investments” includes available-for-sale investments that consist of investments that are primarily U.S. Treasury or U.S. agency securities whose cost basis is $113 million and $137 million at June 20, 2011 and December 31, 2010, respectively, versus a fair value of $117 million and $139 million at June 30, 2011 and December 31, 2010, respectively.