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INVESTMENTS (Tables)
 6 Months Ended
Jun. 30, 2013
Available-for-sale Securities
  
December 31, 2012
(In millions)
Cost or
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
  Fair
  Value
Securities available for sale, carried at fair value:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fixed maturities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Yen-denominated:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Japan government and agencies
 
$
12,612

 
 
 
$
349

 
 
 
$
81

 
 
 
$
12,880

 
Mortgage- and asset-backed securities
 
746

 
 
 
40

 
 
 
1

 
 
 
785

 
Public utilities
 
3,608

 
 
 
116

 
 
 
72

 
 
 
3,652

 
Sovereign and supranational
 
1,404

 
 
 
71

 
 
 
0

 
 
 
1,475

 
Banks/financial institutions
 
3,455

 
 
 
233

 
 
 
180

 
 
 
3,508

 
Other corporate
 
5,656

 
 
 
241

 
 
 
153

 
 
 
5,744

 
Total yen-denominated
 
27,481

 
 
 
1,050

 
 
 
487

 
 
 
28,044

 
  Dollar-denominated:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government and agencies
 
93

 
 
 
24

 
 
 
0

 
 
 
117

 
Municipalities
 
1,045

 
 
 
156

 
 
 
6

 
 
 
1,195

 
Mortgage- and asset-backed securities
 
188

 
 
 
58

 
 
 
0

 
 
 
246

 
Public utilities
 
4,204

 
 
 
658

 
 
 
17

 
 
 
4,845

 
Sovereign and supranational
 
476

 
 
 
123

 
 
 
2

 
 
 
597

 
Banks/financial institutions
 
3,626

 
 
 
506

 
 
 
6

 
 
 
4,126

 
Other corporate
 
16,300

 
 
 
1,878

 
 
 
95

 
 
 
18,083

 
Total dollar-denominated
 
25,932

 
 
 
3,403

 
 
 
126

 
 
 
29,209

 
Total fixed maturities
 
53,413

 
 
 
4,453

 
 
 
613

 
 
 
57,253

 
Perpetual securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Yen-denominated:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Banks/financial institutions
 
3,635

 
 
 
193

 
 
 
161

 
 
 
3,667

 
Other corporate
 
309

 
 
 
43

 
 
 
0

 
 
 
352

 
  Dollar-denominated:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Banks/financial institutions
 
269

 
 
 
23

 
 
 
9

 
 
 
283

 
Total perpetual securities
 
4,213

 
 
 
259

 
 
 
170

 
 
 
4,302

 
Equity securities
 
20

 
 
 
4

 
 
 
1

 
 
 
23

 
Total securities available for sale
 
$
57,646

 
 
 
$
4,716

 
 
 
$
784

 
 
 
$
61,578

 
The amortized cost for our investments in debt and perpetual securities, the cost for equity securities and the fair values of these investments are shown in the following tables.
 
  
June 30, 2013
(In millions)
Cost or
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
  Fair
  Value
Securities available for sale, carried at fair value:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fixed maturities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Yen-denominated:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Japan government and agencies
 
$
12,100

 
 
 
$
277

 
 
 
$
79

 
 
 
$
12,298

 
Mortgage- and asset-backed securities
 
624

 
 
 
30

 
 
 
1

 
 
 
653

 
Public utilities
 
2,793

 
 
 
74

 
 
 
112

 
 
 
2,755

 
Sovereign and supranational
 
1,047

 
 
 
70

 
 
 
1

 
 
 
1,116

 
Banks/financial institutions
 
3,064

 
 
 
126

 
 
 
370

 
 
 
2,820

 
Other corporate
 
4,193

 
 
 
110

 
 
 
303

 
 
 
4,000

 
Total yen-denominated
 
23,821

 
 
 
687

 
 
 
866

 
 
 
23,642

 
  Dollar-denominated:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government and agencies
 
95

 
 
 
11

 
 
 
2

 
 
 
104

 
Municipalities
 
1,017

 
 
 
82

 
 
 
8

 
 
 
1,091

 
Mortgage- and asset-backed securities
 
189

 
 
 
53

 
 
 
0

 
 
 
242

 
Public utilities
 
4,887

 
 
 
392

 
 
 
168

 
 
 
5,111

 
Sovereign and supranational
 
468

 
 
 
81

 
 
 
4

 
 
 
545

 
Banks/financial institutions
 
3,592

 
 
 
328

 
 
 
46

 
 
 
3,874

 
Other corporate
 
21,309

 
 
 
999

 
 
 
1,107

 
 
 
21,201

 
Total dollar-denominated
 
31,557

 
 
 
1,946

 
 
 
1,335

 
 
 
32,168

 
Total fixed maturities
 
55,378

 
 
 
2,633

 
 
 
2,201

 
 
 
55,810

 
Perpetual securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Yen-denominated:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Banks/financial institutions
 
2,786

 
 
 
91

 
 
 
461

 
 
 
2,416

 
Other corporate
 
272

 
 
 
0

 
 
 
69

 
 
 
203

 
  Dollar-denominated:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Banks/financial institutions
 
208

 
 
 
22

 
 
 
15

 
 
 
215

 
Total perpetual securities
 
3,266

 
 
 
113

 
 
 
545

 
 
 
2,834

 
Equity securities
 
17

 
 
 
5

 
 
 
0

 
 
 
22

 
Total securities available for sale
 
$
58,661

 
 
 
$
2,751

 
 
 
$
2,746

 
 
 
$
58,666

 
Held-to-maturity Securities
  
June 30, 2013
(In millions)
Cost or
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair  
Value  
Securities held to maturity, carried at amortized cost:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fixed maturities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Yen-denominated:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Japan government and agencies
 
$
23,946

 
 
 
$
741

 
 
 
$
5

 
 
 
$
24,682

 
Municipalities
 
429

 
 
 
38

 
 
 
0

 
 
 
467

 
Mortgage- and asset-backed securities
 
67

 
 
 
3

 
 
 
0

 
 
 
70

 
Public utilities
 
4,323

 
 
 
127

 
 
 
258

 
 
 
4,192

 
Sovereign and supranational
 
2,817

 
 
 
127

 
 
 
100

 
 
 
2,844

 
Banks/financial institutions
 
7,222

 
 
 
101

 
 
 
691

 
 
 
6,632

 
Other corporate
 
3,914

 
 
 
185

 
 
 
225

 
 
 
3,874

 
Total yen-denominated
 
42,718

 
 
 
1,322

 
 
 
1,279

 
 
 
42,761

 
Total securities held to maturity
 
$
42,718

 
 
 
$
1,322

 
 
 
$
1,279

 
 
 
$
42,761

 
  
December 31, 2012
(In millions)
Cost or
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
Securities held to maturity, carried at amortized cost:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fixed maturities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Yen-denominated:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Japan government and agencies
 
$
32,043

 
 
 
$
356

 
 
 
$
67

 
 
 
$
32,332

 
Municipalities
 
492

 
 
 
30

 
 
 
2

 
 
 
520

 
Mortgage- and asset-backed securities
 
90

 
 
 
4

 
 
 
0

 
 
 
94

 
Public utilities
 
4,924

 
 
 
233

 
 
 
106

 
 
 
5,051

 
Sovereign and supranational
 
3,209

 
 
 
192

 
 
 
84

 
 
 
3,317

 
Banks/financial institutions
 
9,211

 
 
 
211

 
 
 
431

 
 
 
8,991

 
Other corporate
 
4,457

 
 
 
187

 
 
 
108

 
 
 
4,536

 
Total yen-denominated
 
54,426

 
 
 
1,213

 
 
 
798

 
 
 
54,841

 
Total securities held to maturity
 
$
54,426

 
 
 
$
1,213

 
 
 
$
798

 
 
 
$
54,841

 
Investments Classified by Contractual Maturity Date
The contractual maturities of our investments in fixed maturities at June 30, 2013, were as follows:
  
Aflac Japan
 
Aflac U.S.
(In millions)
Amortized
Cost
 
Fair
Value
 
Amortized
Cost
 
Fair  
Value  
Available for sale:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Due in one year or less
 
$
723

 
 
 
$
730

 
 
 
$
107

 
 
 
$
108

 
Due after one year through five years
 
1,987

 
 
 
2,075

 
 
 
393

 
 
 
448

 
Due after five years through 10 years
 
9,677

 
 
 
9,450

 
 
 
1,413

 
 
 
1,530

 
Due after 10 years
 
31,715

 
 
 
31,312

 
 
 
8,368

 
 
 
9,067

 
Mortgage- and asset-backed securities
 
765

 
 
 
839

 
 
 
39

 
 
 
48

 
Total fixed maturities available for sale
 
$
44,867

 
 
 
$
44,406

 
 
 
$
10,320

 
 
 
$
11,201

 
Held to maturity:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Due in one year or less
 
$
77

 
 
 
$
78

 
 
 
$
0

 
 
 
$
0

 
Due after one year through five years
 
1,224

 
 
 
1,289

 
 
 
0

 
 
 
0

 
Due after five years through 10 years
 
2,256

 
 
 
2,308

 
 
 
0

 
 
 
0

 
Due after 10 years
 
39,094

 
 
 
39,016

 
 
 
0

 
 
 
0

 
Mortgage- and asset-backed securities
 
67

 
 
 
70

 
 
 
0

 
 
 
0

 
Total fixed maturities held to maturity
 
$
42,718

 
 
 
$
42,761

 
 
 
$
0

 
 
 
$
0

 
Economic Maturities of Investments in Perpetual Securities
The economic maturities of our investments in perpetual securities, which were all reported as available for sale at June 30, 2013, were as follows:
  
Aflac Japan
 
Aflac U.S.
(In millions)
Amortized
Cost
 
Fair
Value
 
Amortized
Cost
 
Fair  
Value  
Due in one year or less
 
$
0

 
 
 
$
0

 
 
 
$
0

 
 
 
$
0

 
Due after one year through five years
 
1,098

 
 
 
948

 
 
 
5

 
 
 
5

 
Due after five years through 10 years
 
272

 
 
 
203

 
 
 
0

 
 
 
0

 
Due after 10 years
 
1,792

 
 
 
1,580

 
 
 
99

 
 
 
98

 
Total perpetual securities available for sale
 
$
3,162

 
 
 
$
2,731

 
 
 
$
104

 
 
 
$
103

 
Bank and Financial Institution Investments
Our total investments in the bank and financial institution sector, including those classified as perpetual securities, were as follows:
  
June 30, 2013
 
December 31, 2012
  
Total Investments in
Banks and Financial
Institutions Sector
(in millions)
 
Percentage of
Total Investment
Portfolio
 
Total Investments in
Banks and Financial
Institutions Sector
(in millions)
 
Percentage of
Total Investment    
Portfolio
Fixed maturities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Amortized cost
 
$
13,878

 
 
 
14
%
 
 
 
$
16,292

 
 
 
14
%
 
Fair value
 
13,326

 
 
 
13

 
 
 
16,625

 
 
 
14

 
Perpetual securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Upper Tier II:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Amortized cost
 
$
2,084

 
 
 
2
%
 
 
 
$
2,825

 
 
 
3
%
 
Fair value
 
1,877

 
 
 
2

 
 
 
2,919

 
 
 
3

 
Tier I:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Amortized cost
 
910

 
 
 
1

 
 
 
1,079

 
 
 
1

 
Fair value
 
754

 
 
 
1

 
 
 
1,031

 
 
 
1

 
Total:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Amortized cost
 
$
16,872

 
 
 
17
%
 
 
 
$
20,196

 
 
 
18
%
 
Fair value
 
15,957

 
 
 
16

 
 
 
20,575

 
 
 
18

 
Gain (Loss) on Investments
Information regarding pretax realized gains and losses from investments is as follows:


  
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
(In millions)
2013
 
2012
 
2013
 
2012
 
Realized investment gains (losses) on securities:
 
 
 
 
 
 
 
 
Fixed maturities:
 
 
 
 
 
 
 
 
Available for sale:
 
 
 
 
 
 
 
 
Gross gains from sales
$
73

 
$
19

 
$
192

 
$
33

 
Gross losses from sales
0

 
(35
)
 
(6
)
 
(36
)
 
Net gains (losses) from redemptions
15

 
2

 
21

 
2

 
Other-than-temporary impairment losses
0

 
(267
)
 
(54
)
 
(330
)
 
Held to maturity:
 
 
 
 
 
 
 
 
Net gains (losses) from redemptions
0

 
3

 
0

 
3

 
Total fixed maturities
88

 
(278
)
 
153

 
(328
)
 
Perpetual securities:
 
 
 
 
 
 
 
 
Available for sale:
 
 
 
 
 
 
 
 
Gross gains from sales
0

 
0

 
0

 
70

 
Gross losses from sales
(2
)
 
3

 
(2
)
 
(62
)
 
Net gains (losses) from redemptions
0

 
0

 
0

 
60

 
Other-than-temporary impairment losses
0

 
(76
)
 
0

 
(216
)
 
Total perpetual securities
(2
)
 
(73
)
 
(2
)
 
(148
)
 
Equity securities:
 
 
 
 
 
 
 
 
Other-than-temporary impairment losses
0

 
0

 
(1
)
 
0

 
Total equity securities
0

 
0

 
(1
)
 
0

 
Derivatives and other:
 
 
 
 
 
 
 
 
Derivative gains (losses)
111

 
(67
)
 
198

 
13

 
Other
4

 
0

 
9

 
0

 
Total derivatives and other
115

 
(67
)
 
207

 
13

 
Total realized investment gains (losses)
$
201

 
$
(418
)
 
$
357

 
$
(463
)
 
Other Than Temporary Impairment Losses on Investment Securities
The following table details our pretax other-than-temporary impairment losses by investment category that resulted from our impairment evaluation process.
  
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
(In millions)
2013
 
2012
 
2013
 
2012
 
Perpetual securities
$
0

 
$
76

 
$
0

 
$
216

 
Corporate bonds
0

 
120

 
38

 
183

 
Mortgage- and asset-backed securities
0

 
3

 
0

 
3

 
Sovereign and supranational
0

 
144

 
16

 
144

 
Equity securities
0

 
0

 
1

 
0

 
Total other-than-temporary impairment losses realized
$
0

(1) 
$
343

(1) 
$
55

(1) 
$
546

(1) 
(1) Includes $0 and $267 for the three-month periods and $0 and $295 for the six-month periods ended June 30, 2013 and 2012, respectively, for credit-related impairments; $0 for the three-month period and $1 for the six-month period ended June 30, 2013 for impairments due to severity and duration of decline in fair value; and $0 and $76 for the three-month periods and $54 and $251 for the six-month periods ended June 30, 2013 and 2012, respectively, from change in intent to sell securities
Net Effect on Shareholders' Equity of Unrealized Gains and Losses from Investment Securities
The net effect on shareholders’ equity of unrealized gains and losses from investment securities was as follows:
(In millions)
June 30,
2013
 
December 31,
2012
Unrealized gains (losses) on securities available for sale
 
$
5

 
 
 
$
3,932

 
Unamortized unrealized gains on securities transferred to held to maturity
 
14

 
 
 
20

 
Deferred income taxes
 
(217
)
 
 
 
(1,382
)
 
Shareholders’ equity, unrealized gains (losses) on investment securities
 
$
(198
)
 
 
 
$
2,570

 
Investments Gross Unrealized Loss Aging
The following tables show the fair values and gross unrealized losses of our available-for-sale and held-to-maturity investments that were in an unrealized loss position, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position.

  
June 30, 2013
  
Total
 
Less than 12 months
 
12 months or longer
(In millions)
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
Fixed Maturities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Japan government and agencies:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Yen-denominated
 
$
4,723

 
 
 
$
84

 
 
 
$
4,723

 
 
 
$
84

 
 
 
$
0

 
 
 
$
0

 
  Municipalities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
121

 
 
 
8

 
 
 
86

 
 
 
4

 
 
 
35

 
 
 
4

 
  Mortgage- and asset- backed
securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
7

 
 
 
0

 
 
 
7

 
 
 
0

 
 
 
0

 
 
 
0

 
  Yen-denominated
 
120

 
 
 
1

 
 
 
0

 
 
 
0

 
 
 
120

 
 
 
1

 
  Public utilities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
2,182

 
 
 
168

 
 
 
2,182

 
 
 
168

 
 
 
0

 
 
 
0

 
  Yen-denominated
 
4,051

 
 
 
370

 
 
 
2,854

 
 
 
205

 
 
 
1,197

 
 
 
165

 
  Sovereign and supranational:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
61

 
 
 
4

 
 
 
29

 
 
 
1

 
 
 
32

 
 
 
3

 
  Yen-denominated
 
913

 
 
 
101

 
 
 
545

 
 
 
13

 
 
 
368

 
 
 
88

 
  Banks/financial institutions:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
786

 
 
 
46

 
 
 
759

 
 
 
43

 
 
 
27

 
 
 
3

 
  Yen-denominated
 
6,280

 
 
 
1,061

 
 
 
3,581

 
 
 
293

 
 
 
2,699

 
 
 
768

 
  Other corporate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
12,656

 
 
 
1,107

 
 
 
12,600

 
 
 
1,101

 
 
 
56

 
 
 
6

 
  Yen-denominated
 
4,381

 
 
 
528

 
 
 
3,362

 
 
 
320

 
 
 
1,019

 
 
 
208

 
  U.S. government and agencies:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
38

 
 
 
2

 
 
 
38

 
 
 
2

 
 
 
0

 
 
 
0

 
  Total fixed maturities
 
36,319

 
 
 
3,480

 
 
 
30,766

 
 
 
2,234

 
 
 
5,553

 
 
 
1,246

 
Perpetual securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
69

 
 
 
15

 
 
 
49

 
 
 
11

 
 
 
20

 
 
 
4

 
  Yen-denominated
 
1,834

 
 
 
530

 
 
 
1,308

 
 
 
289

 
 
 
526

 
 
 
241

 
  Total perpetual securities
 
1,903

 
 
 
545

 
 
 
1,357

 
 
 
300

 
 
 
546

 
 
 
245

 
Equity securities
 
1

 
 
 
0

 
 
 
1

 
 
 
0

 
 
 
0

 
 
 
0

 
  Total
 
$
38,223

 
 
 
$
4,025

 
 
 
$
32,124

 
 
 
$
2,534

 
 
 
$
6,099

 
 
 
$
1,491

 

  
December 31, 2012
  
Total
 
Less than 12 months
 
12 months or longer
(In millions)
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
Fixed Maturities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Japan government and agencies:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Yen-denominated
 
$
17,342

 
 
 
$
148

 
 
 
$
17,342

 
 
 
$
148

 
 
 
$
0

 
 
 
$
0

 
  Municipalities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
34

 
 
 
6

 
 
 
1

 
 
 
0

 
 
 
33

 
 
 
6

 
  Yen-denominated
 
56

 
 
 
2

 
 
 
56

 
 
 
2

 
 
 
0

 
 
 
0

 
  Mortgage- and asset- backed
securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
10

 
 
 
0

 
 
 
10

 
 
 
0

 
 
 
0

 
 
 
0

 
  Yen-denominated
 
136

 
 
 
1

 
 
 
0

 
 
 
0

 
 
 
136

 
 
 
1

 
  Public utilities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
736

 
 
 
17

 
 
 
736

 
 
 
17

 
 
 
0

 
 
 
0

 
  Yen-denominated
 
3,920

 
 
 
178

 
 
 
1,339

 
 
 
31

 
 
 
2,581

 
 
 
147

 
  Sovereign and supranational:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
31

 
 
 
2

 
 
 
0

 
 
 
0

 
 
 
31

 
 
 
2

 
  Yen-denominated
 
1,244

 
 
 
84

 
 
 
507

 
 
 
13

 
 
 
737

 
 
 
71

 
  Banks/financial institutions:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
276

 
 
 
6

 
 
 
180

 
 
 
3

 
 
 
96

 
 
 
3

 
  Yen-denominated
 
6,918

 
 
 
611

 
 
 
1,935

 
 
 
28

 
 
 
4,983

 
 
 
583

 
  Other corporate:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
4,534

 
 
 
95

 
 
 
4,404

 
 
 
86

 
 
 
130

 
 
 
9

 
  Yen-denominated
 
4,013

 
 
 
261

 
 
 
1,635

 
 
 
40

 
 
 
2,378

 
 
 
221

 
  Total fixed maturities
 
39,250

 
 
 
1,411

 
 
 
28,145

 
 
 
368

 
 
 
11,105

 
 
 
1,043

 
Perpetual securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Dollar-denominated
 
136

 
 
 
9

 
 
 
120

 
 
 
0

 
 
 
16

 
 
 
9

 
  Yen-denominated
 
1,315

 
 
 
161

 
 
 
0

 
 
 
0

 
 
 
1,315

 
 
 
161

 
  Total perpetual securities
 
1,451

 
 
 
170

 
 
 
120

 
 
 
0

 
 
 
1,331

 
 
 
170

 
Equity securities
 
6

 
 
 
1

 
 
 
3

 
 
 
0

 
 
 
3

 
 
 
1

 
  Total
 
$
40,707

 
 
 
$
1,582

 
 
 
$
28,268

 
 
 
$
368

 
 
 
$
12,439

 
 
 
$
1,214

 
Investments in Unrealized Loss Position
The following table provides more information on our unrealized loss positions.

 
 
June 30, 2013
 
 
 
December 31, 2012
 
(In millions)
Percentage of
Total Investments in
an Unrealized Loss
Position
 
Percentage of
Gross
Unrealized
Losses
 
Percentage of
Gross
Unrealized
Losses for Investment Grade Securities
 
Percentage of
Total Investments in
an Unrealized Loss
Position
 
Percentage of
Gross
Unrealized
Losses
 
Percentage of
Gross
Unrealized
Losses for Investment Grade Securities
Fixed Maturities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Japan government
and agencies
 
12
%
 
 
 
2
%
 
 
 
100
%
 
 
 
43
%
 
 
 
9
%
 
 
 
100
%
 
  Public utilities
 
16

 
 
 
13

 
 
 
87

 
 
 
11

 
 
 
12

 
 
 
69

 
  Sovereign and
supranational
 
3

 
 
 
3

 
 
 
97

 
 
 
3

 
 
 
6

 
 
 
96

 
  Banks/financial
institutions
 
19

 
 
 
27

 
 
 
72

 
 
 
18

 
 
 
39

 
 
 
76

 
  Other corporate
 
45

 
 
 
41

 
 
 
94

 
 
 
21

 
 
 
23

 
 
 
72

 
  Total fixed
maturities
 
95
%
 
 
 
86
%
 
 
 
 
 
 
 
96
%
 
 
 
89
%
 
 
 
 
 
Perpetual securities
 
5

 
 
 
14

 
 
 
87

 
 
 
4

 
 
 
11

 
 
 
100

 
  Total
 
100
%
 
 
 
100
%
 
 
 
 
 
 
 
100
%
 
 
 
100
%
 
 
 
 
 
Securities Lending
The following table presents our security loans outstanding and the corresponding collateral held: 
(In millions)
June 30, 2013
 
December 31, 2012
Security loans outstanding, fair value
 
$
1,470

 
 
 
$
6,122

 
Cash collateral on loaned securities
 
1,506

 
 
 
6,277

 

The balance of our security loans outstanding was significantly lower at June 30, 2013, compared with that at December 31, 2012, due to the conclusion of a six-month securities lending program that began in the third quarter of 2012. For this particular securities lending program, we invested the cash collateral in JGBs with maturities that corresponded with the conclusion of the program.
Perpetual Securities
  
Schedule of Available-for-sale Securities Reconciliation
Details of our holdings of perpetual securities were as follows:
Perpetual Securities
  
  
 
June 30, 2013
 
December 31, 2012
(In millions)
Credit
Rating
 
Amortized
Cost
 
Fair
Value
 
Unrealized
Gain (Loss)
 
Amortized
Cost
 
Fair
Value
 
Unrealized
Gain (Loss)
Upper Tier II:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
A
 
 
$
160

 
 
 
$
180

 
 
 
$
20

 
 
 
$
460

 
 
 
$
488

 
 
 
$
28

 
 
BBB
 
 
1,671

 
 
 
1,503

 
 
 
(168
)
 
 
 
2,077

 
 
 
2,129

 
 
 
52

 
 
BB or lower
 
 
253

 
 
 
194

 
 
 
(59
)
 
 
 
288

 
 
 
302

 
 
 
14

 
Total Upper Tier II
 
 
 
2,084

 
 
 
1,877

 
 
 
(207
)
 
 
 
2,825

 
 
 
2,919

 
 
 
94

 
Tier I:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
BBB
 
 
798

 
 
 
640

 
 
 
(158
)
 
 
 
966

 
 
 
904

 
 
 
(62
)
 
 
BB or lower
 
 
112

 
 
 
114

 
 
 
2

 
 
 
113

 
 
 
127

 
 
 
14

 
Total Tier I
 
 
 
910

 
 
 
754

 
 
 
(156
)
 
 
 
1,079

 
 
 
1,031

 
 
 
(48
)
 
Other subordinated
- non-banks
BBB
 
 
272

 
 
 
203

 
 
 
(69
)
 
 
 
309

 
 
 
352

 
 
 
43

 
Total
 
 
 
$
3,266

 
 
 
$
2,834

 
 
 
$
(432
)
 
 
 
$
4,213

 
 
 
$
4,302

 
 
 
$
89

 
Variable Interest Entity, Consolidated
  
Investments in Variable Interest Entities
The following table presents the amortized cost, fair value and balance sheet caption in which the assets and liabilities of consolidated VIEs are reported.
Investments in Consolidated Variable Interest Entities
 
June 30, 2013
 
December 31, 2012
(In millions)
Amortized
Cost
 
Fair
Value
 
Amortized
Cost
 
Fair
Value
Assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fixed maturities, available for sale
 
$
4,636

 
 
 
$
5,022

 
 
 
$
5,058

 
 
 
$
5,787

 
Perpetual securities, available for sale
 
500

 
 
 
450

 
 
 
559

 
 
 
574

 
Fixed maturities, held to maturity
 
254

 
 
 
240

 
 
 
289

 
 
 
287

 
Other assets
 
135

 
 
 
135

 
 
 
191

 
 
 
191

 
Total assets of consolidated VIEs
 
$
5,525

 
 
 
$
5,847

 
 
 
$
6,097

 
 
 
$
6,839

 
Liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other liabilities
 
$
284

 
 
 
$
284

 
 
 
$
399

 
 
 
$
399

 
Total liabilities of consolidated VIEs
 
$
284

 
 
 
$
284

 
 
 
$
399

 
 
 
$
399

 
Variable Interest Entity, Not Consolidated
  
Investments in Variable Interest Entities
VIEs-Not Consolidated
The table below reflects the amortized cost, fair value and balance sheet caption in which our investment in VIEs not consolidated are reported.
Investments in Variable Interest Entities Not Consolidated
  
June 30, 2013
 
December 31, 2012
(In millions)
Amortized
Cost
 
Fair
Value
 
Amortized
Cost
 
Fair
Value
Assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fixed maturities, available for sale
 
$
6,854

 
 
 
$
6,815

 
 
 
$
7,738

 
 
 
$
8,350

 
Perpetual securities, available for sale
 
395

 
 
 
375

 
 
 
736

 
 
 
751

 
Fixed maturities, held to maturity
 
3,356

 
 
 
3,305

 
 
 
3,829

 
 
 
3,922

 
Total investments in VIEs not consolidated
 
$
10,605

 
 
 
$
10,495

 
 
 
$
12,303

 
 
 
$
13,023