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Derivative Instruments and Hedging Activities (Tables)
 12 Months Ended
Dec. 31, 2022
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule of Derivative Instruments in Statement of Financial Position
The following table summarizes the amounts of derivative instruments reported on our Consolidated Balance Sheet. The amounts are presented on a gross basis, are segregated by derivatives that are designated and qualifying as hedging instruments or those that are not, and are further segregated by type of contract within those two categories.
Derivative contracts in a receivable and payable position exclude open trade equity on derivatives cleared through central clearing counterparties. Any associated margin exchanged with our central clearing counterparties are treated as settlements of the derivative exposure, rather than collateral. Such payments are recognized as settlements of the derivatives contracts in a receivable and payable position on our Consolidated Balance Sheet.
Notional amounts are reference amounts from which contractual obligations are derived and are not recorded on the balance sheet. In our view, derivative notional is not an accurate measure of our derivative exposure when viewed in isolation from other factors, such as market rate fluctuations and counterparty credit risk.
20222021
Derivative contracts in a
Notional amount
Derivative contracts in a
Notional amount
December 31, ($ in millions)
receivable position
payable position
receivable position
payable position
Derivatives designated as accounting hedges
Interest rate contracts
Swaps
$— $— $30,619 $— $— $17,039 
Purchased options
22 — 2,800 — — — 
Foreign exchange contracts
Forwards
— 1 151 — 2 171 
Total derivatives designated as accounting hedges
22 1 33,570 — 2 17,210 
Derivatives not designated as accounting hedges
Interest rate contracts
Futures and forwards
— — 37 1 — 223 
Written options
— — 79 5 2 580 
Total interest rate risk
— — 116 6 2 803 
Foreign exchange contracts
Futures and forwards— 1 147 — 1 154 
Total foreign exchange risk— 1 147 — 1 154 
Credit contracts (a)
Other credit derivatives— 39 n/a— 56 n/a
Total credit risk— 39 n/a— 56 n/a
Equity contracts
Written options
— 1 — — 1 2 
Purchased options
1 — — 1 — — 
Total equity risk
1 1 — 1 1 2 
Total derivatives not designated as accounting hedges
1 41 263 7 60 959 
Total derivatives
$23 $42 $33,833 $7 $62 $18,169 
n/a = not applicable
(a)The maximum potential amount of undiscounted future payments that could be required under these credit derivatives was $82 million and $119 million as of December 31, 2022, and December 31, 2021, respectively.
Schedule of Fair Value Hedging Instruments, Statements of Financial Performance and Financial Position, Location
The following table presents amounts recorded on our Consolidated Balance Sheet related to cumulative basis adjustments for fair value hedges.
December 31, ($ in millions)
Carrying amount of the hedged itemsCumulative amount of fair value hedging adjustment included in the carrying amount of the hedged items
TotalDiscontinued (a)
202220212022202120222021
Assets
Available-for-sale securities (b)$11,265 $5,119 $(180)$(14)$(181)$(30)
Finance receivables and loans, net (c)46,390 44,098 (617)(37)(57)46 
Liabilities
Long-term debt$7,697 $7,213 $112 $110 $120 $110 
(a)Represents the fair value hedging adjustment on qualifying hedges for which the hedging relationship was discontinued. This represents a subset of the amounts reported in the total hedging adjustment.
(b)These amounts include the amortized cost basis and unallocated basis adjustments of closed portfolios of available-for-sale securities used to designate hedging relationships in which the hedged item is the stated amount of assets in the closed portfolios anticipated to be outstanding for the designated hedge period. At December 31, 2022, and December 31, 2021, the amortized cost basis and unallocated basis adjustments of the closed portfolios used in these hedging relationships was $10.0 billion and $3.9 billion, respectively, of which $9.7 billion and $1.6 billion, respectively, represents the amortized cost basis and unallocated basis adjustments of closed portfolios designated in an active hedge relationship. At December 31, 2022, and December 31, 2021, the total cumulative basis adjustments associated with these hedging relationships was a $135 million liability and a $6 million liability, respectively, of which the portion related to discontinued hedging relationships was a $138 million liability and a $20 million liability, respectively. At December 31, 2022, and December 31, 2021, the notional amounts of the designated hedged items were $4.0 billion and $1.2 billion, respectively, with cumulative basis adjustments of a $3 million asset and a $14 million asset, respectively, which would be allocated across the entire remaining closed pool upon termination or maturity of the hedge relationship. Refer to Note 8 for a reconciliation of the amortized cost and fair value of available-for-sale securities.
(c)These amounts include the carrying value of closed portfolios of loan receivables used to designate hedging relationships in which the hedged item is the stated amount of assets in the closed portfolios anticipated to be outstanding for the designated hedge period. At December 31, 2022, and December 31, 2021, the carrying value of the closed portfolios used in these hedging relationships was $46.4 billion and $44.1 billion, respectively, of which $46.1 billion and $43.5 billion, respectively, represents the carrying value of closed portfolios designated in an active hedge relationship. At December 31, 2022, and December 31, 2021, the total cumulative basis adjustments associated with these hedging relationships was a $617 million liability and a $37 million liability, respectively, of which the portion related to discontinued hedging relationships was a $57 million liability and a $46 million asset, respectively. At December 31, 2022, and December 31, 2021, the notional amounts of the designated hedged items were $22.8 billion and $15.6 billion, respectively, with cumulative basis adjustments of a $560 million liability and an $82 million liability, respectively, which would be allocated across the entire remaining closed pool upon termination or maturity of the hedge relationship.
Schedule of Derivative Instruments Not Designated as Accounting Hedge
The following table summarizes the location and amounts of gains and losses on derivative instruments not designated as accounting hedges reported in our Consolidated Statement of Income.
Year ended December 31, ($ in millions)
202220212020
Gain (loss) recognized in earnings
Interest rate contracts
Gain (loss) on mortgage and automotive loans, net$14 $(12)$(10)
Other income, net of losses
8 8 (19)
Total interest rate contracts
22 (4)(29)
Foreign exchange contracts
Other operating expenses8 (1)(7)
Total foreign exchange contracts
8 (1)(7)
Credit contracts
Interest and fees on finance receivables and loans— — (4)
Other income, net of losses(2)(24)(1)
Total credit contracts(2)(24)(5)
Total gain (loss) recognized in earnings$28 $(29)$(41)
Schedule of Location and Amounts of Gains and Losses on Derivative Instruments
The following table summarizes the location and amounts of gains and losses on derivative instruments designated as qualifying fair value and cash flow hedges reported in our Consolidated Statement of Income.
Interest and fees on finance receivables and loansInterest and dividends on investment securities and other earning assetsInterest on depositsInterest on long-term debt
Year ended December 31, ($ in millions)
202220212020202220212020202220212020202220212020
Gain (loss) on fair value hedging relationships
Interest rate contracts
Hedged fixed-rate unsecured debt$— $— $— $— $— $— $— $— $— $1 $68 $(135)
Derivatives designated as hedging instruments on fixed-rate unsecured debt— — — — — — — — — (1)(68)135 
Hedged fixed-rate FHLB advances— — — — — — — — — (5)— — 
Derivatives designated as hedging instruments on fixed-rate FHLB advances— — — — — — — — — 5 — — 
Hedged available-for-sale securities— — — (185)(40)38 — — — — — — 
Derivatives designated as hedging instruments on available-for-sale securities— — — 185 40 (38)— — — — — — 
Hedged fixed-rate consumer automotive loans(599)(215)139 — — — — — — — — — 
Derivatives designated as hedging instruments on fixed-rate consumer automotive loans599 215 (139)— — — — — — — — — 
Total gain on fair value hedging relationships
— — — — — — — — — — — — 
Gain (loss) on cash flow hedging relationships
Interest rate contracts
Hedged deposit liabilities
Reclassified from accumulated other comprehensive income into income— — — — — — — (1)(8)— — — 
Hedged variable-rate commercial loans
Reclassified from accumulated other comprehensive income into income21 58 73 — — — — — — — — — 
Reclassified from accumulated other comprehensive income into income as a result of a forecasted transaction being probable not to occur— 4 — — — — — — — — — — 
Other hedged forecasted transactions
Reclassified from accumulated other comprehensive income into income— — — — — — — — — (1)— — 
Total gain (loss) on cash flow hedging relationships$21 $62 $73 $— $— $— $— $(1)$(8)$(1)$— $— 
Total amounts presented in the Consolidated Statement of Income$8,099 $6,468 $6,581 $841 $600 $736 $1,987 $1,045 $1,952 $763 $860 $1,249 
Schedule of Derivative Instruments
The following table summarizes the location and amounts of gains and losses related to interest and amortization on derivative instruments designated as qualifying fair value and cash flow hedges reported in our Consolidated Statement of Income.
Interest and fees on finance receivables and loansInterest and dividends on investment securities and other earning assetsInterest on long-term debt
Year ended December 31, ($ in millions)
202220212020202220212020202220212020
Gain (loss) on fair value hedging relationships
Interest rate contracts
Amortization of deferred unsecured debt basis adjustments$— $— $— $— $— $— $5 $4 $12 
Interest for qualifying accounting hedges of unsecured debt— — — — — — 1 5 — 
Amortization of deferred secured debt basis adjustments (FHLB advances)— — — — — — (3)(13)(22)
Amortization of deferred basis adjustments of available-for-sale securities— — — 17 (4)(7)— — — 
Interest for qualifying accounting hedges of available-for-sale securities— — — (1)(6)(6)— — — 
Amortization of deferred loan basis adjustments18 (46)(49)— — — — — — 
Interest for qualifying accounting hedges of consumer automotive loans held for investment129 (122)(121)— — — — — — 
Total gain (loss) on fair value hedging relationships$147 $(168)$(170)$16 $(10)$(13)$3 $(4)$(10)
Gain on cash flow hedging relationships
Interest rate contracts
Interest for qualifying accounting hedges of variable-rate commercial loans$— $— $1 $— $— $— $— $— $— 
Total gain on cash flow hedging relationships$— $— $1 $— $— $— $— $— $— 
Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss)
The following table summarizes the effect of cash flow hedges on accumulated other comprehensive loss.
Year ended December 31, ($ in millions)
202220212020
Interest rate contracts
(Loss) gain recognized in other comprehensive loss$(23)$(61)$105 
Schedule of Net Investment Hedges in Accumulated Other Comprehensive Income (Loss)
The following table summarizes the effect of net investment hedges on accumulated other comprehensive loss.
Year ended December 31, ($ in millions)
202220212020
Foreign exchange contracts (a) (b)
Gain (loss) recognized in other comprehensive loss$8 $— $(4)
(a)There were no amounts excluded from effectiveness testing for the years ended December 31, 2022, 2021, or 2020.
(b)Gains and losses reclassified from accumulated other comprehensive loss are reported as other income, net of losses, in the Consolidated Statement of Income. There were no amounts reclassified for the years ended December 31, 2022, 2021, or 2020.