Goodwill and Other Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2013

Goodwill and Other Intangible Assets (Tables) [Abstract]

Goodwill and other intangible assets

Goodwill and other intangible assets consist of the following.

(in millions)	Mar 31, 2013		Dec 31, 2012
Goodwill	$	48,067	$	48,175
Mortgage servicing rights	7,949		7,614
Other intangible assets:
Purchased credit card relationships	$	242	$	295
Other credit card-related intangibles	213		229
Core deposit intangibles	305		355
Other intangibles	1,322		1,356
Total other intangible assets	$	2,082	$	2,235

Goodwill attributed to the business segments

The following table presents goodwill attributed to the business segments.

(in millions)	Mar 31, 2013		Dec 31, 2012
Consumer & Community Banking	$	30,951	$	31,048
Corporate & Investment Bank	6,883		6,895
Commercial Banking	2,862		2,863
Asset Management	6,994		6,992
Corporate/Private Equity	377		377
Total goodwill	$	48,067	$	48,175

Changes in the carrying amount of goodwill

The following table presents changes in the carrying amount of goodwill.

	Three months ended March 31,
(in millions)	2013			2012
Balance at beginning of period(a)	$	48,175		$	48,188
Changes during the period from:
Business combinations	25			10
Dispositions	—			—
Other(b)	(133		)	10
Balance at March 31,(a)	$	48,067		$	48,208

(a) Reflects gross goodwill balances as the Firm has not recognized any impairment losses to date.

(b) Includes foreign currency translation adjustments and other tax-related adjustments.

Mortgage servicing rights activity

The following table summarizes MSR activity for the three months ended March 31, 2013 and 2012.

	As of or for the three months ended March 31,
(in millions, except where otherwise noted)	2013				2012
Fair value at beginning of period	$	7,614			$	7,223
MSR activity
Originations of MSRs	690				572
Purchase of MSRs	(6		)		1
Disposition of MSRs	(399		)	(e)	—
Changes due to modeled amortization	(259		)		(353		)
Net additions and amortization	26				220
Changes due to market interest rates	546				644
Other changes in valuation due to inputs and assumptions(a)	(237		)		(48		)
Total change in fair value of MSRs(b)	309				596
Fair value at March 31,(c)	$	7,949			$	8,039
Change in unrealized gains/(losses) included in income related to MSRs held at March 31,	$	309			$	596
Contractual service fees, late fees and other ancillary fees included in income	$	869			$	1,033
Third-party mortgage loans serviced at March 31, (in billions)	$	856			$	892
Servicer advances at March 31, (in billions)(d)	$	10.5			$	11.2

(a) Represents the aggregate impact of changes in model inputs and assumptions such as prepayment speeds (which are in turn affected by other assumptions such as home prices), costs to service, ancillary income and discount rates, as well as changes to the valuation models themselves. For the three-month period ended March 31, 2013, the decrease was driven by changes in the inputs and assumptions used to derive prepayment speeds, primarily increases in home prices.

(b) Included changes related to commercial real estate of $(2) million and $(2) million for the three months ended March 31, 2013 and 2012, respectively.

(c) Included $21 million and $29 million related to commercial real estate at March 31, 2013 and 2012, respectively.

(d) Represents amounts the Firm pays as the servicer (e.g., scheduled principal and interest to a trust, taxes and insurance), which will generally be reimbursed within a short period of time after the advance from future cash flows from the trust or the underlying loans. The Firm’s credit risk associated with these advances is minimal because reimbursement of the advances is senior to all cash payments to investors. In addition, the Firm maintains the right to stop payment to investors if the collateral is insufficient to cover the advance.

(e) Includes excess mortgage servicing rights transferred to an agency-sponsored trust in exchange for stripped mortgage backed securities (“SMBS”). A portion of the SMBS was acquired by third parties at the transaction date; the Firm acquired and has retained the remaining balance of those SMBS as trading securities.

Fees And Commissions, Mortgage Banking And Related, Components [Table Text Block]

The following table presents the components of mortgage fees and related income (including the impact of MSR risk management activities) for the three months ended March 31, 2013 and 2012.

	Three months ended March 31,
(in millions)	2013			2012
Mortgage fees and related income
Net production revenue:
Production revenue	$	995		$	1,432
Repurchase losses	(81		)	(302		)
Net production revenue	914			1,130
Net mortgage servicing revenue
Operating revenue:
Loan servicing revenue	936			1,039
Changes in MSR asset fair value due to modeled amortization	(258		)	(351		)
Total operating revenue	678			688
Risk management:
Changes in MSR asset fair value due to market interest rates	546			644
Other changes in MSR asset fair value due to inputs or assumptions in model(a)	(237		)	(48		)
Change in derivative fair value and other	(451		)	(406		)
Total risk management	(142		)	190
Net mortgage servicing revenue	536			878
All other	2			2
Mortgage fees and related income	$	1,452		$	2,010

(a) Represents the aggregate impact of changes in model inputs and assumptions such as prepayment speeds (which are in turn affected by other assumptions such as home prices), costs to service, ancillary income and discount rates, as well as changes to the valuation models themselves. For the three-month period ended March 31, 2013, the decrease was driven by changes in the inputs and assumptions used to derive prepayment speeds, primarily increases in home prices.

Key economic assumptions used to determine the fair value of the Firm's Mortgage Servicing Rights (MSRs)

The table below outlines the key economic assumptions used to determine the fair value of the Firm’s MSRs at March 31, 2013 and December 31, 2012, and outlines the sensitivities of those fair values to immediate adverse changes in those assumptions, as defined below.

(in millions, except rates)	Mar 31, 2013			Dec 31, 2012
Weighted-average prepayment speed assumption (“CPR”)	10.65		%	13.04		%
Impact on fair value of 10% adverse change	$	(480	)	$	(517	)
Impact on fair value of 20% adverse change	(926		)	(1,009		)
Weighted-average option adjusted spread	7.81		%	7.61		%
Impact on fair value of 100 basis points adverse change	$	(343	)	$	(306	)
Impact on fair value of 200 basis points adverse change	(662		)	(591		)

CPR: Constant prepayment rate.

Intangible assets components of credit card relationships, core deposits and other intangible assets

The components of credit card relationships, core deposits and other intangible assets were as follows.

	March 31, 2013						December 31, 2012
(in millions)	Gross amount(a)		Accumulated amortization(a)		Net carrying value		Gross amount		Accumulated amortization		Net carrying value
Purchased credit card relationships	$	3,509	$	3,267	$	242	$	3,775	$	3,480	$	295
Other credit card-related intangibles	538		325		213		850		621		229
Core deposit intangibles	4,133		3,828		305		4,133		3,778		355
Other intangibles(b)	2,388		1,066		1,322		2,390		1,034		1,356

(a) The decrease in the gross amount and accumulated amortization from December 31, 2012, was due to the removal of fully amortized assets.

(b) Includes intangible assets of approximately $600 million consisting primarily of asset management advisory contracts, which were determined to have an indefinite life and are not amortized.

Amortization expense related to credit card relationships, core deposits and other intangible assets

The following table presents amortization expense related to credit card relationships, core deposits and other intangible assets.

	Three months ended March 31,
(in millions)	2013		2012
Purchased credit card relationships	$	53	$	69
Other credit card-related intangibles	14		27
Core deposit intangibles	50		61
Other intangibles	35		36
Total amortization expense	$	152	$	193

Estimated future amortization expense related to credit card relationships, core deposits and other intangible assets

The following table presents estimated future amortization expense related to credit card relationships, core deposits and other intangible assets at March 31, 2013.

For the year (in millions)	Purchased credit card relationships		Other credit card-related intangibles		Core deposit intangibles		Other intangibles		Total
2013(a)	$	192	$	57	$	196	$	134	$	579
2014	91		49		102		118		360
2015	7		39		26		98		170
2016	4		34		14		90		142
2017	1		29		13		90		133

(a) Includes $53 million, $14 million, $50 million and $35 million of amortization expense related to purchased credit card relationships, other credit card-related intangibles, core deposit intangibles and other intangibles, respectively, recognized during the three months ended March 31, 2013.