Derivative Financial Instruments and Hedging Activities (Tables)

3 Months Ended

Mar. 31, 2015

The gains/(losses), by hedge designation, recorded in income for the periods ended March 31 were as follows (in millions):



	First Quarter
	2015			2014
Fair value hedges
Interest rate contracts
Net interest settlements and accruals excluded from the assessment of hedge effectiveness	$	88		$	69
Ineffectiveness (a)	6			5
Derivatives not designated as hedging instruments
Interest rate contracts	(43		)	(18		)
Foreign currency exchange contracts	65			(5		)
Cross-currency interest rate swap contracts	89			(5		)
Total	$	205		$	46

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(a)	For the first quarter of 2015 and 2014, hedge ineffectiveness reflects the net change in fair value on derivatives of $221 million gain and $105 million gain, respectively, and change in value on hedged debt attributable to the change in benchmark interest rates of $215 million loss and $100 million loss, respectively.

The notional amount and estimated fair value of our derivative financial instruments were as follows (in millions):



	March 31, 2015								December 31, 2014
	Notional		Fair Value of Assets			Fair Value of Liabilities			Notional		Fair Value of Assets			Fair Value of Liabilities
Fair value hedges
Interest rate contracts	$	22,859	$	736		$	26		$	23,203	$	602		$	38
Derivatives not designated as hedging instruments
Interest rate contracts	59,942		233			150			56,558		168			89
Foreign currency exchange contracts (a)	1,177		52			1			1,527		18			1
Cross-currency interest rate swap contracts	2,336		183			120			2,425		71			39
Total derivative financial instruments, gross	$	86,314	1,204			297			$	83,713	859			167
Counterparty netting and collateral (b)			(189		)	(189		)			(136		)	(136		)
Total derivative financial instruments, net			$	1,015		$	108				$	723		$	31

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(a)	Includes forward contracts between Ford Credit and an affiliated company.


(b)	At March 31, 2015 and December 31, 2014, we did not receive or pledge any cash collateral.