Goodwill and Mortgage Servicing Rights (Tables)

6 Months Ended

Jun. 30, 2018

Table 59: Mortgage Servicing Rights



	Commercial MSRs						Residential MSRs
In millions	2018			2017			2018			2017
January 1	$	668		$	576		$	1,164		$	1,182
Additions:
From loans sold with servicing retained	23			46			23			28
Purchases	44			34			47			154
Changes in fair value due to:
Time and payoffs (a)	(68		)	(52		)	(84		)	(85		)
Other (b)	81			14			147			(30		)
June 30	$	748		$	618		$	1,297		$	1,249
Related unpaid principal balance at June 30	$	174,589		$	147,531		$	124,325		$	131,060
Servicing advances at June 30	$	212		$	239		$	158		$	218


(a)	Represents decrease in MSR value due to passage of time, including the impact from both regularly scheduled loan principal payments and loans that were paid down or paid off during the period.


(b)	Represents MSR value changes resulting primarily from market-driven changes in interest rates.

Table 60: Commercial Mortgage Loan Servicing Rights – Key Valuation Assumptions



Dollars in millions	June 30 2018			December 31 2017
Fair value	$	748		$	668
Weighted-average life (years)	4.1			4.4
Weighted-average constant prepayment rate	7.46		%	8.51		%
Decline in fair value from 10% adverse change	$	10		$	12
Decline in fair value from 20% adverse change	$	21		$	23
Effective discount rate	8.48		%	7.81		%
Decline in fair value from 10% adverse change	$	21		$	18
Decline in fair value from 20% adverse change	$	41		$	36

Table 61: Residential Mortgage Loan Servicing Rights – Key Valuation Assumptions



Dollars in millions	June 30 2018				December 31 2017
Fair value	$	1,297			$	1,164
Weighted-average life (years)	7.1				6.4
Weighted-average constant prepayment rate	8.43		%		10.04		%
Decline in fair value from 10% adverse change	$	39			$	44
Decline in fair value from 20% adverse change	$	75			$	85
Weighted-average option adjusted spread	828			bps	830			bps
Decline in fair value from 10% adverse change	$	39			$	35
Decline in fair value from 20% adverse change	$	75			$	67