Comprehensive income

12 Months Ended

Dec. 31, 2018

15. Comprehensive income

In February 2018, the Financial Accounting Standards Board issued accounting guidance related to reclassification of certain tax effects from AOCI so that following enactment of the Tax Act the tax effects of items within AOCI reflect the appropriate tax. The guidance provided for a reclassification from AOCI to retained earnings for the effect of remeasuring deferred tax assets and liabilities related to items within AOCI at the 21 percent corporate tax rate established by the Tax Act. The impact of that reclassification was an increase in retained earnings as of December 31, 2017 resulting from items remaining in AOCI as of that date as follows:

	(In thousands)

Net unrealized losses on investment securities	$	8,065
Defined benefit plans liability adjustments		53,960
Cash flow hedges and other		2,004
Increase to retained earnings	$	64,029

The following tables display the components of other comprehensive income (loss) and amounts reclassified from accumulated other comprehensive income (loss) to net income:

	Investment			Defined Benefit						Total Amount				Income
	Securities (a)			Plans			Other			Before Tax				Tax			Net
	(In thousands)

Balance — January 1, 2018	$	(59,957	)		(413,168	)		(20,165	)	$	(493,290	)			129,476		$	(363,814	)
Cumulative effect of change in accounting principle — equity securities		(22,795	)		—			—			(22,795	)			5,942			(16,853	)
Other comprehensive income before reclassifications:
Unrealized holding losses, net		(121,589	)		—			—			(121,589	)			31,946			(89,643	)
Foreign currency translation adjustment		—			—			(2,817	)		(2,817	)			592			(2,225	)
Unrealized losses on cash flow hedges		—			—			(4,965	)		(4,965	)			1,306			(3,659	)
Current year benefit plans gains		—			19,871			—			19,871				(5,224	)		14,647
Total other comprehensive income (loss) before reclassifications		(121,589	)		19,871			(7,782	)		(109,500	)			28,620			(80,880	)
Amounts reclassified from accumulated other comprehensive income that (increase) decrease net income:
Amortization of unrealized holding losses on held-to-maturity (“HTM”) securities		4,252			—			—			4,252		(c)		(1,118	)		3,134
Gains realized in net income		(18	)		—			—			(18	)	(d)		4			(14	)
Accretion of net gain on terminated cash flow hedges		—			—			(111	)		(111	)	(e)		29			(82	)
Net yield adjustment from cash flow hedges currently in effect		—			—			13,339			13,339		(c)		(3,507	)		9,832
Amortization of prior service credit		—			(4,172	)		—			(4,172	)	(f)		1,097			(3,075	)
Amortization of actuarial losses		—			42,967			—			42,967		(f)		(11,296	)		31,671
Total other comprehensive income (loss)		(117,355	)		58,666			5,446			(53,243	)			13,829			(39,414	)
Balance — December 31, 2018	$	(200,107	)		(354,502	)		(14,719	)	$	(569,328	)			149,247		$	(420,081	)

	Investment Securities						Defined Benefit						Total Amount				Income
	With OTTI (b)			All Other			Plans			Other			Before Tax				Tax			Net
	(In thousands)

Balance — January 1, 2017	$	46,725			(73,785	)		(449,917	)		(8,268	)	$	(485,245	)			190,609		$	(294,636	)
Other comprehensive income before reclassifications:
Unrealized holding gains (losses), net		(8,746	)		(6,259	)		—			—			(15,005	)			7,269			(7,736	)
Foreign currency translation adjustment		—			—			—			4,447			4,447				(2,206	)		2,241
Unrealized losses on cash flow hedges		—			—			—			(12,291	)		(12,291	)			4,837			(7,454	)
Current year benefit plans gains		—			—			9,276			—			9,276				(3,650	)		5,626
Total other comprehensive income (loss) before reclassifications		(8,746	)		(6,259	)		9,276			(7,844	)		(13,573	)			6,250			(7,323	)
Amounts reclassified from accumulated other comprehensive income that (increase) decrease net income:
Amortization of unrealized holding losses on HTM securities		—			3,387			—			—			3,387		(c)		(1,333	)		2,054
Gains realized in net income		(18,351	)		(2,928	)		—			—			(21,279	)	(d)		7,195			(14,084	)
Accretion of net gain on terminated cash flow hedges		—			—			—			(137	)		(137	)	(e)		54			(83	)
Net yield adjustment from cash flow hedges currently in effect		—			—			—			(3,916	)		(3,916	)	(c)		1,541			(2,375	)
Amortization of prior service credit		—			—			(802	)		—			(802	)	(f)		315			(487	)
Amortization of actuarial losses		—			—			28,275			—			28,275		(f)		(11,126	)		17,149
Total other comprehensive income (loss)		(27,097	)		(5,800	)		36,749			(11,897	)		(8,045	)			2,896			(5,149	)
Reclassification of income tax effects to retained earnings		—			—			—			—			—				(64,029	)		(64,029	)
Balance — December 31, 2017	$	19,628			(79,585	)		(413,168	)		(20,165	)	$	(493,290	)			129,476		$	(363,814	)

Balance — January 1, 2016	$	16,359			62,849			(489,660	)		(4,093	)	$	(414,545	)			162,918		$	(251,627	)
Other comprehensive income before reclassifications:
Unrealized holding gains (losses), net		30,366			(110,316	)		—			—			(79,950	)			31,509			(48,441	)
Foreign currency translation adjustment		—			—			—			(4,020	)		(4,020	)			1,406			(2,614	)
Current year benefit plans gains		—			—			14,125			—			14,125				(5,557	)		8,568
Total other comprehensive income (loss) before reclassifications		30,366			(110,316	)		14,125			(4,020	)		(69,845	)			27,358			(42,487	)
Amounts reclassified from accumulated other comprehensive income that (increase) decrease net income:
Amortization of unrealized holding losses on HTM securities		—			3,996			—			—			3,996		(c)		(1,572	)		2,424
Gains realized in net income		—			(30,314	)		—			—			(30,314	)	(d)		11,925			(18,389	)
Accretion of net gain on terminated cash flow hedges		—			—			—			(155	)		(155	)	(e)		61			(94	)
Amortization of prior service credit		—			—			(4,587	)		—			(4,587	)	(f)		1,805			(2,782	)
Amortization of actuarial losses		—			—			30,205			—			30,205		(f)		(11,886	)		18,319
Total other comprehensive income (loss)		30,366			(136,634	)		39,743			(4,175	)		(70,700	)			27,691			(43,009	)
Balance — December 31, 2016	$	46,725			(73,785	)		(449,917	)		(8,268	)	$	(485,245	)			190,609		$	(294,636	)

(a) Beginning January 1, 2018, equity securities with readily determinable market values are required to be measured at fair value with changes in fair value recognized in the income statement. Separate presentation of investment securities with an other-than-temporary impairment change is no longer required.

(b) Other-than-temporary impairment.

(d) Included in gain (loss) on bank investment securities.

(e) Included in interest expense.

(f) Included in other costs of operations.

Accumulated other comprehensive income (loss), net consisted of the following:

				Defined
	Investment Securities			Benefit Plans			Other			Total
	(In thousands)

Balance at January 1, 2016	$	48,087		$	(296,979	)	$	(2,735	)	$	(251,627	)
Net gain (loss) during 2016		(64,406	)		24,105			(2,708	)		(43,009	)
Balance at December 31, 2016		(16,319	)		(272,874	)		(5,443	)		(294,636	)
Net gain (loss) during 2017		(19,766	)		22,288			(7,671	)		(5,149	)
Reclassification of income tax effects to retained earnings		(8,065	)		(53,960	)		(2,004	)		(64,029	)
Balance at December 31, 2017		(44,150	)		(304,546	)		(15,118	)		(363,814	)
Cumulative effect of change in accounting principle — equity securities		(16,853	)		—			—			(16,853	)
Net gain (loss) during 2018		(86,523	)		43,243			3,866			(39,414	)
Balance at December 31, 2018	$	(147,526	)	$	(261,303	)	$	(11,252	)	$	(420,081	)