Accumulated Other Comprehensive Income (Loss) (Tables)

12 Months Ended

Dec. 31, 2020

Schedule of the changes in the components of accumulated other comprehensive income (loss) balances

The following table presents the changes in the components of AOCI balances for the years ended December 31, 2020, 2019 and 2018:



($ in thousands)	AFS Debt Securities		Cash Flow Hedges		Foreign Currency Translation Adjustments (1)		Total
Balance, December 31, 2017	$	(30,898)	$	—	$	(6,621)	$	(37,519)
Cumulative-effect of change in accounting principle related to marketable equity securities (2)	385		—		—		385
Reclassification of tax effects in AOCI resulting from the new federal corporate income tax rate (3)	(6,656)		—		—		(6,656)
Balance, January 1, 2018, adjusted	(37,169)		—		(6,621)		(43,790)
Net unrealized losses arising during the period	(6,866)		—		(5,732)		(12,598)
Amounts reclassified from AOCI	(1,786)		—		—		(1,786)
Changes, net of tax	(8,652)		—		(5,732)		(14,384)
Balance, December 31, 2018	$	(45,821)	$	—	$	(12,353)	$	(58,174)



Net unrealized gains (losses) arising during the period	46,170		—		(3,636)		42,534
Amounts reclassified from AOCI	(2,768)		—		—		(2,768)
Changes, net of tax	43,402		—		(3,636)		39,766
Balance, December 31, 2019	$	(2,419)	$	—	$	(15,989)	$	(18,408)
Net unrealized gains (losses) arising during the period	63,329		(1,149)		9,297		71,477
Amounts reclassified from AOCI	(8,663)		(81)		—		(8,744)
Changes, net of tax	54,666		(1,230)		9,297		62,733
Balance, December 31, 2020	$	52,247	$	(1,230)	$	(6,692)	$	44,325

(1)Represents foreign currency translation adjustments related to the Company’s net investment in non-U.S. operations, including related hedges. The functional currency and reporting currency of the Company’s foreign subsidiary was RMB and USD, respectively.

(2)Represents the impact of the adoption of ASU 2016-01, Financial Instruments — Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities on January 1, 2018.

(3)Represents the amounts reclassified from AOCI to retained earnings due to the early adoption of ASU 2018-02, Income Statement — Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income on January 1, 2018. ASU 2018-02 permits companies to reclassify the stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 from AOCI to retained earnings on a retrospective basis. The adoption of the guidance resulted in a cumulative-effect adjustment as of January 1, 2018 that increased retained earnings by $6.7 million and reduced AOCI by the same amount.

Schedule of components of other comprehensive income (loss), reclassifications to net income and the related tax effects

The following table presents the components of other comprehensive income (loss), reclassifications to net income and the related tax effects for the years ended December 31, 2020, 2019 and 2018:



($ in thousands)	Year Ended December 31,
	2020						2019						2018
	Before - Tax		Tax Effect		Net-of- Tax		Before - Tax		Tax Effect		Net-of- Tax		Before - Tax		Tax Effect		Net-of- Tax
AFS debt securities:
Net unrealized gains (losses) arising during the period	$	89,868	$	(26,539)	$	63,329	$	65,549	$	(19,379)	$	46,170	$	(9,748)	$	2,882	$	(6,866)
Net realized (gains) reclassified into net income (1)	(12,299)		3,636		(8,663)		(3,930)		1,162		(2,768)		(2,535)		749		(1,786)
Net change	77,569		(22,903)		54,666		61,619		(18,217)		43,402		(12,283)		3,631		(8,652)
Cash flow hedges
Net unrealized gains (losses) arising during the period	(1,604)		455		(1,149)		—		—		—		—		—		—
Net realized (gains) reclassified into net income (2)	(113)		32		(81)		—		—		—		—		—		—
Net change	(1,717)		487		(1,230)		—		—		—		—		—		—
Foreign currency translation adjustments, net of hedges:
Net unrealized gains (losses) arising during the period (3)	7,398		1,899		9,297		290		(3,926)		(3,636)		(5,732)		—		(5,732)
Net change	7,398		1,899		9,297		290		(3,926)		(3,636)		(5,732)		—		(5,732)
Other comprehensive income (loss)	$	83,250	$	(20,517)	$	62,733	$	61,909	$	(22,143)	$	39,766	$	(18,015)	$	3,631	$	(14,384)

(1)For the years ended December 31, 2020, 2019 and 2018, pre-tax amounts were reported in Gains on sales of AFS debt securities on the Consolidated Statement of Income.

(2)For the year ended December 31, 2020, pre-tax amounts were reported in Interest expense on the Consolidated Statement of Income.

(3)The tax effects on foreign currency translation adjustments, net of hedges represent the cumulative net deferred tax liabilities on net investment hedges since its inception.