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Investment Securities
 3 Months Ended
Mar. 31, 2018
Investment Securities Disclosure [Abstract]  
Investment Securities
NOTE 5 INVESTMENT SECURITIES
Table 46: Investment Securities Summary
In millions
 
Amortized
Cost

 
Unrealized
 
Fair
Value

 
Gains

 
Losses

 
 
March 31, 2018
 
 
 
 
 
 
 
 
 
Securities Available for Sale
 
 
 
 
 
 
 
 
 
Debt securities
 
 
 
 
 
 
 
 
 
U.S. Treasury and government agencies
 
$
13,645

 
$
123

 
$
(179
)
 
$
13,589

 
Residential mortgage-backed
 
 
 
 
 
 
 
 
 
Agency
 
26,512

 
74

 
(584
)
 
26,002

 
Non-agency
 
2,320

 
333

 
(17
)
 
2,636

 
Commercial mortgage-backed
 
 
 
 
 
 
 
 
 
Agency
 
1,884

 
1

 
(78
)
 
1,807

 
Non-agency
 
2,585

 
9

 
(24
)
 
2,570

 
Asset-backed
 
5,129

 
71

 
(17
)
 
5,183

 
Other debt
 
4,166

 
103

 
(38
)
 
4,231

 
Total securities available for sale
 
$
56,241

 
$
714

 
$
(937
)
 
$
56,018

 
Securities Held to Maturity
 
 
 
 
 
 
 
 
 
Debt securities
 
 
 
 
 
 
 
 
 
U.S. Treasury and government agencies
 
$
745

 
$
28

 
$
(27
)
 
$
746

 
Residential mortgage-backed
 
 
 
 
 
 
 
 
 
Agency
 
14,663

 
18

 
(382
)
 
14,299

 
Non-agency
 
163

 
3

 
 
 
166

 
Commercial mortgage-backed
 
 
 
 
 
 
 
 
 
Agency
 
338

 
2

 
(1
)
 
339

 
Non-agency
 
524

 
4

 
 
 
528

 
Asset-backed
 
196

 
1

 
 
 
197

 
Other debt
 
1,915

 
59

 
(26
)
 
1,948

 
Total securities held to maturity
 
$
18,544

 
$
115

 
$
(436
)
 
$
18,223

 
December 31, 2017
 
 
 
 
 
 
 
 
 
Securities Available for Sale
 
 
 
 
 
 
 
 
 
Debt securities
 
 
 
 
 
 
 
 
 
U.S. Treasury and government agencies
 
$
14,432

 
$
173

 
$
(84
)
 
$
14,521

 
Residential mortgage-backed
 
 
 
 
 
 
 
 
 
Agency
 
25,534

 
121

 
(249
)
 
25,406

 
Non-agency
 
2,443

 
336

 
(21
)
 
2,758

 
Commercial mortgage-backed
 
 
 
 
 
 
 
 
 
Agency
 
1,960

 
2

 
(58
)
 
1,904

 
Non-agency
 
2,603

 
19

 
(9
)
 
2,613

 
Asset-backed
 
5,331

 
74

 
(8
)
 
5,397

 
Other debt
 
4,322

 
129

 
(17
)
 
4,434

 
Total debt securities
 
56,625

 
854

 
(446
)
 
57,033

 
Other (a)
 
587

 
 
 
(2
)
 
585

 
Total securities available for sale
 
$
57,212

 
$
854

 
$
(448
)
 
$
57,618

 
Securities Held to Maturity
 
 
 
 
 
 
 
 
 
Debt securities
 
 
 
 
 
 
 
 
 
U.S. Treasury and government agencies
 
$
741

 
$
37

 
$
(13
)
 
$
765

 
Residential mortgage-backed
 
 
 
 
 
 
 
 
 
Agency
 
14,503

 
77

 
(139
)
 
14,441

 
Non-agency
 
167

 
7

 
 
 
174

 
Commercial mortgage-backed
 
 
 
 
 
 
 
 
 
Agency
 
407

 
4

 
 
 
411

 
Non-agency
 
538

 
10

 
 
 
548

 
Asset-backed
 
200

 
1

 


 
201

 
Other debt
 
1,957

 
88

 
(20
)
 
2,025

 
Total securities held to maturity
 
$
18,513

 
$
224

 
$
(172
)
 
$
18,565

 

(a)
On January 1, 2018, $.6 billion of available for sale securities, primarily money market funds, were reclassified to equity investments in accordance with the adoption of ASU 2016-01. See the Recently Adopted Accounting Standards portion of Note 1 for additional detail on this adoption.
The fair value of investment securities is impacted by interest rates, credit spreads, market volatility and liquidity conditions. Net unrealized gains and losses in the securities available for sale portfolio are included in Shareholders’ equity as AOCI, unless credit-related. Securities held to maturity are carried at amortized cost. At March 31, 2018, AOCI included pretax gains of $50 million from derivatives that hedged the purchase of investment securities classified as held to maturity. The gains will be accreted into interest income as an adjustment of yield on the securities.

Table 47 presents gross unrealized losses and fair value of debt securities at March 31, 2018 and December 31, 2017. The securities are segregated between investments that have been in a continuous unrealized loss position for less than twelve months and twelve months or more based on the point in time that the fair value declined below the amortized cost basis. The table includes debt securities where a portion of other than temporary impairment (OTTI) has been recognized in AOCI.
Table 47: Gross Unrealized Loss and Fair Value of Debt Securities
 
 
Unrealized loss position less
than 12 months
 
Unrealized loss position 12
months or more
 
Total
 
In millions
 
Unrealized
Loss

 
Fair
Value

 
Unrealized
Loss

 
Fair
Value

 
Unrealized
Loss

 
Fair
Value

 
March 31, 2018
 
 
 
 
 
 
 
 
 
 
 
 
 
Securities Available for Sale
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury and government agencies
 
$
(120
)
 
$
6,937

 
$
(59
)
 
$
1,142

 
$
(179
)
 
$
8,079

 
Residential mortgage-backed
 
 
 
 
 
 
 
 
 
 
 
 
 
Agency
 
(229
)
 
11,684

 
(355
)
 
8,965

 
(584
)
 
20,649

 
Non-agency
 
(1
)
 
94

 
(16
)
 
352

 
(17
)
 
446

 
Commercial mortgage-backed
 
 
 
 
 
 
 
 
 
 
 
 
 
Agency
 
(16
)
 
499

 
(62
)
 
1,243

 
(78
)
 
1,742

 
Non-agency
 
(15
)
 
1,284

 
(9
)
 
325

 
(24
)
 
1,609

 
Asset-backed
 
(14
)
 
2,366

 
(3
)
 
383

 
(17
)
 
2,749

 
Other debt
 
(16
)
 
1,675

 
(22
)
 
787

 
(38
)
 
2,462

 
Total debt securities available for sale
 
$
(411
)
 
$
24,539

 
$
(526
)
 
$
13,197

 
$
(937
)
 
$
37,736

 
Securities Held to Maturity
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury and government agencies
 
$
(7
)
 
$
191

 
$
(20
)
 
$
246

 
$
(27
)
 
$
437

 
Residential mortgage-backed - Agency
 
(133
)
 
7,080

 
(249
)
 
5,830

 
(382
)
 
12,910

 
Commercial mortgage-backed - Agency
 
(1
)
 
170

 
 
 
 
 
(1
)
 
170

 
Other debt
 
(7
)
 
105

 
(19
)
 
85

 
(26
)
 
190

 
Total debt securities held to maturity
 
$
(148
)
 
$
7,546

 
$
(288
)
 
$
6,161

 
$
(436
)
 
$
13,707

 
December 31, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
Securities Available for Sale
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury and government agencies
 
$
(42
)
 
$
6,099

 
$
(42
)
 
$
1,465

 
$
(84
)
 
$
7,564

 
Residential mortgage-backed
 
 
 
 
 
 
 
 
 
 
 
 
 
Agency
 
(47
)
 
8,151

 
(202
)
 
9,954

 
(249
)
 
18,105

 
Non-agency
 

 

 
(21
)
 
383

 
(21
)
 
383

 
Commercial mortgage-backed
 
 
 
 
 
 
 
 
 
 
 
 
 
Agency
 
(11
)
 
524

 
(47
)
 
1,302

 
(58
)
 
1,826

 
Non-agency
 
(3
)
 
400

 
(6
)
 
333

 
(9
)
 
733

 
Asset-backed
 
(4
)
 
1,697

 
(4
)
 
462

 
(8
)
 
2,159

 
Other debt
 
(3
)
 
966

 
(14
)
 
798

 
(17
)
 
1,764

 
Total debt securities available for sale
 
$
(110
)
 
$
17,837

 
$
(336
)
 
$
14,697

 
$
(446
)
 
$
32,534

 
Securities Held to Maturity
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt securities
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury and government agencies
 
$
(3
)
 
$
195

 
$
(10
)
 
$
255

 
$
(13
)
 
$
450

 
Residential mortgage-backed - Agency
 
(10
)
 
3,167

 
(129
)
 
6,168

 
(139
)
 
9,335

 
Other debt
 
(12
)
 
83

 
(8
)
 
67

 
(20
)
 
150

 
Total debt securities held to maturity
 
$
(25
)
 
$
3,445

 
$
(147
)
 
$
6,490

 
$
(172
)
 
$
9,935

 


Evaluating Investment Securities for OTTI

For the securities in Table 47, as of March 31, 2018 we do not intend to sell and believe we will not be required to sell the securities prior to recovery of the amortized cost basis.
On at least a quarterly basis, we review all debt securities that are in an unrealized loss position for OTTI, as discussed in Note 1 Accounting Policies of our 2017 Form 10-K. For those securities on our Consolidated Balance Sheet at March 31, 2018, where during our quarterly security-level impairment assessments we determined losses represented OTTI, we have recorded cumulative credit losses of $1.1 billion in earnings and accordingly have reduced the amortized cost of our securities.

The majority of these cumulative impairment charges related to non-agency residential mortgage-backed and asset-backed securities rated BB or lower. During the first quarters of 2018 and 2017, the OTTI credit losses recognized in noninterest income and the OTTI noncredit losses recognized in AOCI on securities were not significant.

Information relating to gross realized securities gains and losses from the sales of securities is set forth in the following table:
Table 48: Gains (Losses) on Sales of Securities Available for Sale
Three months ended March 31
In millions
Proceeds

Gross Gains

Gross Losses

Net Losses

Tax Benefit

2018
$
4,490

$
37

$
(38
)
$
(1
)
 
2017
$
3,222

$
14

$
(16
)
$
(2
)
$
(1
)
The following table presents, by remaining contractual maturity, the amortized cost, fair value and weighted-average yield of debt securities at March 31, 2018.
Table 49: Contractual Maturity of Debt Securities
March 31, 2018
Dollars in millions
 
1 Year or Less

 
After 1 Year
through 5 Years

 
After 5 Years
through 10 Years

 
After 10
Years

 
Total

 
Securities Available for Sale
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury and government agencies
 
$
85

 
$
7,752

 
$
5,335

 
$
473

 
$
13,645

 
Residential mortgage-backed
 
 
 
 
 
 
 
 
 
 
 
Agency
 
3

 
50

 
568

 
25,891

 
26,512

 
Non-agency
 
 
 
 
 
 
 
2,320

 
2,320

 
Commercial mortgage-backed
 
 
 
 
 
 
 
 
 
 
 
Agency
 
 
 
313

 
560

 
1,011

 
1,884

 
Non-agency
 
 
 
 
 
450

 
2,135

 
2,585

 
Asset-backed
 
19

 
1,877

 
1,940

 
1,293

 
5,129

 
Other debt
 
683

 
1,784

 
632

 
1,067

 
4,166

 
Total debt securities available for sale
 
$
790

 
$
11,776

 
$
9,485

 
$
34,190

 
$
56,241

 
Fair value
 
$
789

 
$
11,676

 
$
9,462

 
$
34,091

 
$
56,018

 
Weighted-average yield, GAAP basis
 
2.39
%
 
2.18
%
 
2.40
%
 
3.05
%
 
2.75
%
 
Securities Held to Maturity
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury and government agencies
 
 
 
 
 
$
478

 
$
267

 
$
745

 
Residential mortgage-backed
 
 
 
 
 
 
 
 
 
 
 
Agency
 
 
 
$
79

 
334

 
14,250

 
14,663

 
Non-agency
 
 
 
 
 
 
 
163

 
163

 
Commercial mortgage-backed
 
 
 
 
 
 
 
 
 
 
 
Agency
 
$
156

 
125

 
5

 
52

 
338

 
Non-agency
 
 
 
 
 
 
 
524

 
524

 
Asset-backed
 
 
 
 
 
113

 
83

 
196

 
Other debt
 
14

 
431

 
848

 
622

 
1,915

 
Total debt securities held to maturity
 
$
170

 
$
635

 
$
1,778

 
$
15,961

 
$
18,544

 
Fair value
 
$
170

—

$
646

—

$
1,821

 
$
15,586

 
$
18,223

 
Weighted-average yield, GAAP basis
 
3.53
%
 
3.84
%
 
3.52
%
 
3.21
%
 
3.26
%
 


Weighted-average yields are based on amortized cost with effective yields weighted for the contractual maturity of each security. At March 31, 2018, there were no securities of a single issuer, other than the Federal National Mortgage Association (FNMA), that exceeded 10% of Total shareholders’ equity. The FNMA investments had a total amortized cost of $32.7 billion and fair value of $31.9 billion.
The following table presents the fair value of securities that have been either pledged to or accepted from others to collateralize outstanding borrowings.
Table 50: Fair Value of Securities Pledged and Accepted as Collateral
In millions
March 31
2018

December 31
2017

Pledged to others
$
8,264

$
8,175

Accepted from others:
 
 
Permitted by contract or custom to sell or repledge
$
1,134

$
1,152

Permitted amount repledged to others
$
1,098

$
1,097



The securities pledged to others include positions held in our portfolio of investment securities, trading securities and securities accepted as collateral from others that we are permitted by contract or custom to sell or repledge, and were used to secure public and trust deposits, repurchase agreements and for other purposes.