Trading securities are recorded at fair value with subsequent changes in fair value recorded as “Fair value losses, net” in our condensed consolidated statements of operations and comprehensive income. The following table displays our investments in trading securities.


	As of
	September 30, 2020			December 31, 2019
	(Dollars in millions)
Mortgage-related securities:
Fannie Mae		$	2,750		$	3,424
Other agency(1)		3,518			4,490
Private-label and other mortgage securities		158			629
Total mortgage-related securities (includes $850 million and $896 million, respectively, related to consolidated trusts)		6,426			8,543
Non-mortgage-related securities:
U.S. Treasury securities		135,972			39,501
Other securities		74			79
Total non-mortgage-related securities		136,046			39,580
Total trading securities		$	142,472		$	48,123


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,

			2020		2019		2020		2019
		(Dollars in millions)
Net trading gains (losses)			$	(91)	$	95	$	691	$	370
Net trading gains (losses) recognized in the period related to securities still held at period end			(71)		82		448		298

We record AFS securities at fair value with unrealized gains and losses, recorded net of tax, as a component of “Other comprehensive income (loss)” and we recognize realized gains and losses from the sale of AFS securities in “Investment gains, net” in our condensed consolidated statements of operations and comprehensive income. We define the amortized cost basis of our AFS securities as unpaid principal balance, net of unamortized premiums and discounts, and other cost basis adjustments. Pursuant to the CECL standard, we record an allowance for credit losses for AFS securities that reflects the impairment for credit losses, which are limited to the amount that fair value is less than the amortized cost. Impairment due to non-credit losses are recorded as unrealized losses within other comprehensive income.

The following tables display the amortized cost, allowance for credit losses, gross unrealized gains and losses in accumulated other comprehensive income (loss) (“AOCI”), and fair value by major security type for AFS securities.


	As of September 30, 2020
	Total Amortized Cost(1)			Allowance for Credit Losses		Gross Unrealized Gains in AOCI		Gross Unrealized Losses in AOCI			Total Fair Value(1)
	(Dollars in millions)
Fannie Mae		$	1,195	$	—	$	102		$	(14)	$	1,283
Other agency(2)		85		—		11			—		96
Alt-A and subprime private-label securities		4		—		2			—		6

Mortgage revenue bonds		249		(3)		9			—		255
Other mortgage-related securities		247		—		8			—		255
Total		$	1,780	$	(3)	$	132		$	(14)	$	1,895


	As of December 31, 2019
	Total Amortized Cost(1)(3)			Gross Unrealized Gains			Gross Unrealized Losses			Total Fair Value(1)
	(Dollars in millions)
Fannie Mae		$	1,445		$	85		$	(10)	$	1,520
Other agency(2)		183			15			—		198
Alt-A and subprime private-label securities		34			23			—		57
Mortgage revenue bonds		309			9			(3)		315
Other mortgage-related securities		310			5			(1)		314
Total		$	2,281		$	137		$	(14)	$	2,404

(1)We exclude from amortized cost and fair value accrued interest of $7 million and $10 million as of September 30, 2020 and December 31, 2019, respectively, which we record in “Other assets” in our condensed consolidated balance sheets.

(3)Prior to our adoption of the CECL standard, total amortized cost represented the unpaid principal balance, unamortized premiums, discounts and other cost basis adjustments, as well as temporary impairments recognized in “Investment gains, net” in our consolidated statements of operations and comprehensive income.

Our Fannie Mae and other agency AFS securities consist of securities issued by us, Freddie Mac, or Ginnie Mae. The principal and interest on these securities are guaranteed by the issuing agency. We believe that the guaranty provided by the issuing agency, the support provided to the agencies by the U.S. government, the importance of the agencies to the liquidity and stability in the secondary mortgage market, and the long history of zero credit losses on agency mortgage-related securities are all indicators that there are currently no credit losses on these securities, even if the security is in an unrealized loss position. In addition, we generally hold these securities that are in an unrealized loss position to recovery. As a result, unless we intend to sell the security, we do not recognize an allowance for credit losses on agency mortgage-related securities.

As of September 30, 2020, substantially all of our non-agency mortgage-related securities were in an unrealized gain position. As a result, we have not recognized an allowance for credit losses on these securities.

The following tables display additional information regarding gross unrealized losses and fair value by major security type for AFS securities in an unrealized loss position, excluding allowance for credit losses.


	As of September 30, 2020
	Less Than 12 Consecutive Months					12 Consecutive Months or Longer
	Gross Unrealized Losses in AOCI			Fair Value		Gross Unrealized Losses in AOCI			Fair Value
	(Dollars in millions)
Fannie Mae		$	(2)	$	72		$	(12)	$	90
Mortgage revenue bonds		—		—			—		—
Other mortgage-related securities		—		—			—		—
Total		$	(2)	$	72		$	(12)	$	90

	As of December 31, 2019
	Less Than 12 Consecutive Months					12 Consecutive Months or Longer
	Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value
	(Dollars in millions)
Fannie Mae		$	—	$	—		$	(10)	$	337
Mortgage revenue bonds		—		—			(3)		3
Other mortgage-related securities		(1)		130			—		—
Total		$	(1)	$	130		$	(13)	$	340


	For the Three Months Ended September 30,		For the Nine Months Ended September 30,

			2020		2019		2020		2019
		(Dollars in millions)
Gross realized gains			$	15	$	—	$	45	$	171

Total proceeds (excludes initial sale of securities from new portfolio securitizations)			137		—		258		376


	As of
	September 30, 2020
	(Dollars in millions)
Net unrealized gains on AFS securities for which we have not recorded an allowance for credit losses	$	93

Other	27
Accumulated other comprehensive income	$	120


	As of
	December 31, 2019
	(Dollars in millions)
Net unrealized gains on AFS securities for which we have not recorded OTTI	$	97

Other	34
Accumulated other comprehensive income	$	131

The following table displays the amortized cost and fair value of our AFS securities by major security type and remaining contractual maturity, assuming no principal prepayments. The contractual maturity of mortgage-backed securities is not a reliable indicator of their expected life because borrowers generally have the right to prepay their obligations at any time.


	As of September 30, 2020
	Total Carrying Amount (1)			Total Fair Value		One Year or Less					After One Year Through Five Years					After Five Years Through Ten Years					After Ten Years
						Net Carrying Amount (1)			Fair Value		Net Carrying Amount (1)			Fair Value		Net Carrying Amount (1)			Fair Value		Net Carrying Amount (1)			Fair Value
	(Dollars in millions)
Fannie Mae		$	1,195	$	1,283		$	—	$	—		$	6	$	6		$	88	$	100		$	1,101	$	1,177
Other agency		85		96			—		—			—		—			10		11			75		85
Alt-A and subprime private-label securities		4		6			—		—			—		—			2		3			2		3

Mortgage revenue bonds		246		255			1		1			28		30			24		24			193		200
Other mortgage-related securities		247		255			—		—			—		—			20		21			227		234
Total		$	1,777	$	1,895		$	1	$	1		$	34	$	36		$	144	$	159		$	1,598	$	1,699