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Investment Securities
 9 Months Ended
Sep. 30, 2019
Investments, Debt and Equity Securities [Abstract]  
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure Investment Securities
Our investment portfolio includes various debt and equity securities. Our debt securities, which are classified as available-for-sale or held-to-maturity, include government securities, corporate bonds, asset-backed securities, and mortgage-backed securities. The cost, fair value, and gross unrealized gains and losses on available-for-sale and held-to-maturity debt securities were as follows.
 
 
September 30, 2019
 
December 31, 2018


Amortized cost

Gross unrealized

Fair value

Amortized cost

Gross unrealized

Fair value
($ in millions)

gains

losses

gains

losses

Available-for-sale securities
















Debt securities
















U.S. Treasury and federal agencies

$
2,389


$
8


$
(15
)

$
2,382


$
1,911


$
—


$
(60
)

$
1,851

U.S. States and political subdivisions

612


19


(1
)

630


816


3


(17
)

802

Foreign government

152


3


—


155


145


1


(1
)

145

Agency mortgage-backed residential

19,887


244


(23
)

20,108


17,486


47


(395
)

17,138

Mortgage-backed residential
 
2,799

 
22

 
(9
)
 
2,812

 
2,796

 
1

 
(111
)
 
2,686

Agency mortgage-backed commercial
 
1,341

 
72

 
—

 
1,413

 
3

 
—

 
—

 
3

Mortgage-backed commercial

112


1


—


113


715


1


(2
)

714

Asset-backed

413


4


—


417


723


2


(2
)

723

Corporate debt

1,321


35


(2
)

1,354


1,286


1


(46
)

1,241

Total available-for-sale securities (a) (b) (c)

$
29,026


$
408


$
(50
)

$
29,384


$
25,881


$
56


$
(634
)

$
25,303

Held-to-maturity securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Agency mortgage-backed residential (d)
 
$
2,593

 
$
70

 
$
(1
)
 
$
2,662

 
$
2,319

 
$
6

 
$
(61
)
 
$
2,264

Asset-backed retained notes
 
25

 
—

 
—

 
25

 
43

 
—

 
—

 
43

Total held-to-maturity securities

$
2,618


$
70


$
(1
)

$
2,687


$
2,362

 
$
6

 
$
(61
)
 
$
2,307

(a)
Certain entities related to our Insurance operations are required to deposit securities with state regulatory authorities. These deposited securities totaled $12 million at both September 30, 2019, and December 31, 2018, respectively.
(b)
Certain available-for-sale securities are included in fair value hedging relationships. Refer to Note 17 for additional information.
(c)
Available-for-sale securities with a fair value of $2.5 billion and $9.2 billion at September 30, 2019, and December 31, 2018, respectively, were pledged to secure advances from the Federal Home Loan Bank (FHLB), short-term borrowings or repurchase agreements, or for other purposes as required by contractual obligation or law. Under these agreements, we have granted the counterparty the right to sell or pledge $594 million and $821 million of the underlying investment securities at September 30, 2019, and December 31, 2018, respectively.
(d)
Held-to-maturity securities with a fair value of $972 million and $1.2 billion at September 30, 2019, and December 31, 2018, respectively, were pledged to secure advances from the FHLB.
The maturity distribution of debt securities outstanding is summarized in the following tables. Call or prepayment options may cause actual maturities to differ from contractual maturities.


Total

Due in one year or less

Due after one year through five years

Due after five years through ten years

Due after ten years
($ in millions)

Amount

Yield

Amount

Yield

Amount

Yield

Amount

Yield

Amount

Yield
September 30, 2019




















Fair value of available-for-sale securities (a)




















U.S. Treasury and federal agencies

$
2,382


1.5
%

$
65


2.1
%

$
1,742


1.5
%

$
575


1.6
%

$
—


—
%
U.S. States and political subdivisions

630


3.1


21


2.2


61


2.2


169


2.8


379


3.4

Foreign government

155


2.3


4


1.4


65


2.3


86


2.3


—


—

Agency mortgage-backed residential
 
20,108

 
3.3

 
—

 
—

 
—

 
—

 
49

 
2.0

 
20,059

 
3.3

Mortgage-backed residential
 
2,812

 
3.3

 
—

 
—

 
—

 
—

 
—

 
—

 
2,812

 
3.3

Agency mortgage-backed commercial
 
1,413

 
2.9

 
—

 
—

 
3

 
3.2

 
1,089

 
3.0

 
321

 
2.6

Mortgage-backed commercial

113


3.5


—


—


—


—


—


—


113


3.5

Asset-backed

417


3.5


—


—


310


3.5


53


3.9


54


3.0

Corporate debt

1,354


3.2


125


2.8


571


3.0


643


3.4


15


5.5

Total available-for-sale securities

$
29,384


3.1


$
215


2.5


$
2,752


2.0


$
2,664


2.8


$
23,753


3.3

Amortized cost of available-for-sale securities

$
29,026




$
215




$
2,745




$
2,568




$
23,498



Amortized cost of held-to-maturity securities
 


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Agency mortgage-backed residential
 
$
2,593

 
3.2
%
 
$
—

 
—
%
 
$
—

 
—
%
 
$
—

 
—
%
 
$
2,593

 
3.2
%
Asset-backed retained notes
 
25

 
2.2

 
—

 
—

 
25

 
2.2

 
—

 
—

 
—

 
—

Total held-to-maturity securities
 
$
2,618

 
3.2

 
$
—

 
—

 
$
25

 
2.2

 
$
—

 
—

 
$
2,593

 
3.2

December 31, 2018




















Fair value of available-for-sale securities (a)




















U.S. Treasury and federal agencies

$
1,851


1.9
%

$
12


1.0
%

$
1,277


1.8
%

$
562


2.0
%

$
—


—
%
U.S. States and political subdivisions

802


3.0


49


1.9


43


2.3


252


2.6


458


3.4

Foreign government

145


2.4


18


3.1


60


2.3


67


2.4


—


—

Agency mortgage-backed residential
 
17,138

 
3.3

 
—

 
—

 
—

 
—

 
54

 
1.9

 
17,084

 
3.3

Mortgage-backed residential

2,686

 
3.3

 
—

 
—

 
—

 
—

 
—

 
—

 
2,686

 
3.3

Agency mortgage-backed commercial
 
3

 
3.1

 
—

 
—

 
3

 
3.1

 
—

 
—

 
—

 
—

Mortgage-backed commercial

714


3.8


—


—


—


—


46


3.9


668


3.8

Asset-backed

723


3.5


—


—


478


3.4


121


4.0


124


3.3

Corporate debt

1,241


3.1


144


2.8


496


2.9


581


3.3


20


5.5

Total available-for-sale securities

$
25,303


3.2


$
223


2.6


$
2,357


2.4


$
1,683


2.8


$
21,040


3.3

Amortized cost of available-for-sale securities

$
25,881





$
224





$
2,405





$
1,743





$
21,509




Amortized cost of held-to-maturity securities

 






















Agency mortgage-backed residential
 
$
2,319

 
3.2
%
 
$
—

 
—
%
 
$
—

 
—
%
 
$
—

 
—
%
 
$
2,319

 
3.2
%
Asset-backed retained notes
 
43

 
2.0

 
—

 
—

 
42

 
2.0

 
1

 
3.3

 
—

 
—

Total held-to-maturity securities
 
$
2,362

 
3.2

 
$
—

 
—

 
$
42

 
2.0

 
$
1

 
3.3

 
$
2,319

 
3.2

(a)
Yield is calculated using the effective yield of each security at the end of the period, weighted based on the market value. The effective yield considers the contractual coupon and amortized cost, and excludes expected capital gains and losses.
The balances of cash equivalents were $124 million and $35 million at September 30, 2019, and December 31, 2018, respectively, and were composed primarily of money-market accounts and short-term securities, including U.S. Treasury bills.
The following table presents interest and dividends on investment securities.
 
Three months ended September 30,
 
Nine months ended September 30,
($ in millions)
2019
 
2018
 
2019
 
2018
Taxable interest
$
214


$
172

 
$
648

 
$
490

Taxable dividends
4


4

 
10

 
10

Interest and dividends exempt from U.S. federal income tax
3


6

 
12

 
18

Interest and dividends on investment securities
$
221


$
182

 
$
670

 
$
518


The following table presents gross gains and losses realized upon the sales of available-for-sale securities, and net gains or losses on equity securities held during the period. There were no other-than-temporary impairments of available-for-sale securities for the periods presented.
 
Three months ended September 30,
 
Nine months ended September 30,
($ in millions)
2019
 
2018
 
2019
 
2018
Available-for-sale securities
 
 
 
 
 
 
 
Gross realized gains
$
30

 
$
1

 
$
64

 
$
8

Gross realized losses (a)
(3
)
 
—

 
(4
)
 
—

Net realized gains on available-for-sale securities
27

 
1

 
60

 
8

Net realized gain on equity securities
12

 
15

 
51

 
55

Net unrealized (loss) gain on equity securities
(12
)
 
6

 
63

 
(26
)
Other gain on investments, net
$
27

 
$
22

 
$
174

 
$
37


(a)
Certain available-for-sale securities were sold at a loss during the three months and nine months ended September 30, 2019, and September 30, 2018, as a result of identifiable market or credit events, or a loss was realized based on corporate actions outside of our control (such as a call by the issuer). Any such sales were made in accordance with our risk-management policies and practices.
The table below summarizes available-for-sale and held-to-maturity securities in an unrealized loss position, which we evaluated for other than temporary impairment. For additional information on our methodology, refer to Note 1 to the Consolidated Financial Statements in our 2018 Annual Report on Form 10-K. As of September 30, 2019, we did not have the intent to sell the available-for-sale or held-to-maturity securities with an unrealized loss position and we do not believe it is more likely than not that we will be required to sell these securities before recovery of their amortized cost basis. As a result of this evaluation, we believe that the securities with an unrealized loss position are not considered to be other-than-temporarily impaired at September 30, 2019.
 
 
September 30, 2019
 
December 31, 2018


Less than 12 months

12 months or longer

Less than 12 months

12 months or longer
($ in millions)

Fair value

Unrealized loss

Fair value

Unrealized loss

Fair value

Unrealized loss

Fair value

Unrealized loss
Available-for-sale securities
















Debt securities
















U.S. Treasury and federal agencies

$
1,131


$
(8
)

$
279


$
(7
)

$
31


$
—


$
1,758


$
(60
)
U.S. States and political subdivisions

63


(1
)

9


—


259


(3
)

317


(14
)
Foreign government

11


—


4


—


6


—


74


(1
)
Agency mortgage-backed residential
 
2,722

 
(8
)
 
1,317

 
(15
)
 
5,537

 
(94
)
 
7,808

 
(301
)
Mortgage-backed residential
 
647

 
(2
)
 
221

 
(7
)
 
1,024

 
(20
)
 
1,360

 
(91
)
Mortgage-backed commercial
 
43

 
—

 
—

 
—

 
347

 
(1
)
 
36

 
(1
)
Asset-backed

17


—


13


—


294


(1
)

124


(1
)
Corporate debt

104


—


57


(2
)

576


(19
)

569


(27
)
Total temporarily impaired available-for-sale securities

$
4,738


$
(19
)

$
1,900


$
(31
)

$
8,074


$
(138
)

$
12,046


$
(496
)
Held-to-maturity securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Agency mortgage-backed residential
 
$
142

 
$
(1
)
 
$
87

 
$
—

 
$
457

 
$
(6
)
 
$
1,376

 
$
(55
)
Asset-backed retained notes
 
—

 
—

 
9

 
—

 
16

 
—

 
19

 
—

Total held-to-maturity debt securities
 
$
142

 
$
(1
)
 
$
96

 
$
—

 
$
473

 
$
(6
)
 
$
1,395

 
$
(55
)