Accumulated Other Comprehensive Loss

9 Months Ended

Sep. 30, 2022

The following tables present changes, net of tax, in each component of accumulated other comprehensive loss.


	Three months ended September 30,
($ in millions)	Unrealized gains (losses) on investment securities (a)		Translation adjustments and net investment hedges (b)		Cash flow hedges (b)		Defined benefit pension plans		Accumulated other comprehensive income (loss)






Balance at July 1, 2021	$	259	$	20	$	48	$	(111)	$	216
Net change	(157)		—		(9)		1		(165)
Balance at September 30, 2021	$	102	$	20	$	39	$	(110)	$	51
Balance at July 1, 2022	$	(2,940)	$	19	$	27	$	(115)	$	(3,009)
Net change	(1,343)		(1)		(3)		16		(1,331)
Balance at September 30, 2022	$	(4,283)	$	18	$	24	$	(99)	$	(4,340)

(a)Represents the after-tax difference between the fair value and amortized cost of our available-for-sale securities portfolio.

(b)For additional information on derivative instruments and hedging activities, refer to Note 19.


	Nine months ended September 30,
($ in millions)	Unrealized gains (losses) on investment securities (a)		Translation adjustments and net investment hedges (b)		Cash flow hedges (b)		Defined benefit pension plans		Accumulated other comprehensive income (loss)






Balance at January 1, 2021	$	640	$	19	$	82	$	(110)	$	631
Net change	(538)		1		(43)		—		(580)
Balance at September 30, 2021	$	102	$	20	$	39	$	(110)	$	51
Balance at January 1, 2022	$	(95)	$	19	$	35	$	(117)	$	(158)
Net change	(4,188)		(1)		(11)		18		(4,182)
Balance at September 30, 2022	$	(4,283)	$	18	$	24	$	(99)	$	(4,340)

(a)Represents the after-tax difference between the fair value and amortized cost of our available-for-sale securities portfolio.

(b)For additional information on derivative instruments and hedging activities, refer to Note 19.

Our qualified defined benefit pension plan was frozen in 2006. As of December 31, 2021, we disclosed our intention to settle the qualified defined benefit pension plan in the future. During 2022, we executed our plan to settle the liability in two phases: (1) a single, lump-sum payment window program during the third quarter of 2022; and (2) the purchase of an annuity contract from an independent insurance company for the remainder of the liability during the fourth quarter of 2022. During the three months ended September 30, 2022, we settled $44 million of our pension liability through cash payments to the participants and beneficiaries of the plan. This resulted in a $16 million loss in our Condensed Consolidated Statement of Comprehensive Income upon reclassification from accumulated other comprehensive loss, which included a realized loss of $21 million in compensation and benefits expense and a tax benefit of $5 million. During the fourth quarter of 2022, we settled the remainder of the qualified defined benefit pension plan. Refer to Note 25 for additional information.

The following tables present the before- and after-tax changes in each component of accumulated other comprehensive loss.


Three months ended September 30, 2022 ($ in millions)	Before tax			Tax effect			After tax
Investment securities
Net unrealized losses arising during the period	$	(1,757)		$	416		$	(1,341)
Less: Net realized gains reclassified to income from continuing operations	2		(a)	—		(b)	2

Net change	(1,759)			416			(1,343)
Translation adjustments
Net unrealized losses arising during the period	(11)			2			(9)



Net investment hedges (c)
Net unrealized gains arising during the period	10			(2)			8



Cash flow hedges (c)

Less: Net realized gains reclassified to income from continuing operations	4		(d)	(1)		(b)	3


Defined benefit pension plans

Less: Net realized losses reclassified to income from continuing operations	(21)		(e)	5		(b)	(16)


Other comprehensive loss	$	(1,743)		$	412		$	(1,331)

(a)Includes gains reclassified to other gain on investments, net in our Condensed Consolidated Statement of Comprehensive Income.

(b)Includes amounts reclassified to income tax expense from continuing operations in our Condensed Consolidated Statement of Comprehensive Income.

(c)For additional information on derivative instruments and hedging activities, refer to Note 19.

(d)Includes gains reclassified to interest and fees on finance receivables and loans in our Condensed Consolidated Statement of Comprehensive Income.

(e)Includes losses reclassified to compensation and benefits expense in our Condensed Consolidated Statement of Comprehensive Income as a result of actions taken toward the settlement of our qualified defined benefit pension plan.


Three months ended September 30, 2021 ($ in millions)	Before tax			Tax effect			After tax
Investment securities
Net unrealized losses arising during the period	$	(161)		$	38		$	(123)
Less: Net realized gains reclassified to income from continuing operations	44		(a)	(10)		(b)	34
Net change	(205)			48			(157)
Translation adjustments
Net unrealized losses arising during the period	(4)			1			(3)
Net investment hedges (c)
Net unrealized gains arising during the period	4			(1)			3
Cash flow hedges (c)

Less: Net realized gains reclassified to income from continuing operations	12		(d)	(3)		(b)	9

Defined benefit pension plans

Less: Net realized losses reclassified to income from continuing operations	(1)			—		(b)	(1)

Other comprehensive loss	$	(216)		$	51		$	(165)

(a)Includes gains reclassified to other gain on investments, net in our Condensed Consolidated Statement of Comprehensive Income.

(b)Includes amounts reclassified to income tax expense from continuing operations in our Condensed Consolidated Statement of Comprehensive Income.

(c)For additional information on derivative instruments and hedging activities, refer to Note 19.

(d)Includes gains reclassified to interest and fees on finance receivables and loans in our Condensed Consolidated Statement of Comprehensive Income.


Nine months ended September 30, 2022 ($ in millions)	Before tax			Tax effect			After tax
Investment securities
Net unrealized losses arising during the period	$	(5,465)		$	1,295		$	(4,170)
Less: Net realized gains reclassified to income from continuing operations	23		(a)	(5)		(b)	18

Net change	(5,488)			1,300			(4,188)
Translation adjustments
Net unrealized losses arising during the period	(13)			3			(10)



Net investment hedges (c)
Net unrealized gains arising during the period	11			(2)			9



Cash flow hedges (c)

Less: Net realized gains reclassified to income from continuing operations	15		(d)	(4)		(b)	11


Defined benefit pension plans
Net unrealized gains arising during the period	2			—			2
Less: Net realized losses reclassified to income from continuing operations	(21)		(e)	5		(b)	(16)

Net change	23			(5)			18
Other comprehensive loss	$	(5,482)		$	1,300		$	(4,182)

(a)Includes gains reclassified to other gain on investments, net in our Condensed Consolidated Statement of Comprehensive Income.

(b)Includes amounts reclassified to income tax expense from continuing operations in our Condensed Consolidated Statement of Comprehensive Income.

(c)For additional information on derivative instruments and hedging activities, refer to Note 19.

(d)Includes gains reclassified to interest and fees on finance receivables and loans in our Condensed Consolidated Statement of Comprehensive Income.


Nine months ended September 30, 2021 ($ in millions)	Before tax			Tax effect			After tax
Investment securities
Net unrealized losses arising during the period	$	(621)		$	147		$	(474)
Less: Net realized gains reclassified to income from continuing operations	82		(a)	(18)		(b)	64
Net change	(703)			165			(538)
Translation adjustments
Net unrealized gains arising during the period	1			—			1
Net investment hedges (c)
Net unrealized losses arising during the period	(1)			1			—
Cash flow hedges (c)

Less: Net realized gains reclassified to income from continuing operations	55		(d)	(12)		(b)	43

Defined benefit pension plans
Net unrealized losses arising during the period	(2)			1			(1)
Less: Net realized losses reclassified to income from continuing operations	(1)			—		(b)	(1)
Net change	(1)			1			—
Other comprehensive loss	$	(759)		$	179		$	(580)

(a)Includes gains reclassified to other gain on investments, net in our Condensed Consolidated Statement of Comprehensive Income.

(b)Includes amounts reclassified to income tax expense from continuing operations in our Condensed Consolidated Statement of Comprehensive Income.

(c)For additional information on derivative instruments and hedging activities, refer to Note 19.

(d)Includes gains reclassified to interest and fees on finance receivables and loans in our Condensed Consolidated Statement of Comprehensive Income.