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MORTGAGE BANKING (Tables)
 12 Months Ended
Dec. 31, 2017
Mortgage Banking [Abstract]  
Schedule of mortgage banking activities
Information related to residential mortgage loan sales and the Company's mortgage banking activity is presented below:
 
Year Ended December 31,
(in millions)
2017

 
2016

 
2015

Residential mortgage loan sale proceeds(1)

$3,161

 

$2,652

 

$2,667

Gain on sales
35

 
69

 
51

Mortgage servicing fees
53

 
51

 
55

Repurchased residential mortgages
3

 
6

 
10

Valuation recoveries
(2
)
 
(4
)
 
(9
)
(1) Represents the unpaid principal balance at the time of the sale.
Schedule of valuation allowance for impairment of recognized servicing assets
Changes related to MSRs are presented below:
 
As of and for the Year Ended December 31,
(in millions)
2017

 
2016

MSRs:
 
 
 
Balance as of beginning of period

$167

 

$173

Amount capitalized
37

 
29

Purchases
28

 
—

Amortization
(31
)
 
(35
)
Carrying amount before valuation allowance
201

 
167

Valuation allowance for servicing assets:
 
 
 
Balance as of beginning of period
5

 
9

Valuation recoveries
(2
)
 
(4
)
Balance at end of period
3

 
5

Net carrying value of MSRs

$198

 

$162
Servicing asset at amortized cost
Changes related to MSRs are presented below:
 
As of and for the Year Ended December 31,
(in millions)
2017

 
2016

MSRs:
 
 
 
Balance as of beginning of period

$167

 

$173

Amount capitalized
37

 
29

Purchases
28

 
—

Amortization
(31
)
 
(35
)
Carrying amount before valuation allowance
201

 
167

Valuation allowance for servicing assets:
 
 
 
Balance as of beginning of period
5

 
9

Valuation recoveries
(2
)
 
(4
)
Balance at end of period
3

 
5

Net carrying value of MSRs

$198

 

$162
Schedule of fair value assumptions used to estimate the value of Mortgage Servicing Rights
The key economic assumptions used to estimate the value of MSRs are presented in the following table:
 
December 31,
 
2017
 
2016
(dollars in millions)
Weighted-Average
   Range
 
Weighted-Average
   Range
Fair value
$218
Min
Max
 
$182
Min
Max
Weighted-average life (in years)
5.9
2.3
8.4
 
5.7
2.6
7.3
Weighted-average constant prepayment rate
10.0%
6.6%
20.1%
 
10.8%
8.8%
22.3%
Weighted-average discount rate
9.9%
9.1%
12.1%
 
9.7%
9.1%
12.1%
Schedule of fair value assumptions used to estimate the value of Mortgage Servicing Rights capitalized in current period
The key economic assumptions used in estimating the fair value of MSRs capitalized during the period are presented below:
 
Year Ended December 31,
 
2017
 
2016
 
2015
Weighted-average life (in years)
7.3
 
6.1
 
5.9
Weighted-average constant prepayment rate
 8.7%
 
 11.0%
 
 10.7%
Weighted-average discount rate
 9.8%
 
 9.7%
 
 9.7%
Schedule of the impact to fair value of an adverse change in key economic assumptions
The sensitivity analysis below presents the impact to current fair value of an immediate 50 basis point and 100 basis point adverse change in the key economic assumptions and presents the decline in fair value that would occur if the adverse change were realized. These sensitivities are hypothetical, with the effect of a variation in a particular assumption on the fair value of the mortgage servicing rights calculated independently without changing any other assumption. In reality, changes in one factor may result in changes in another (e.g., changes in interest rates, which drive changes in prepayment rates, could result in changes in the discount rates), which may amplify or counteract the sensitivities. The primary risk inherent in the Company’s MSRs is an increase in prepayments of the underlying mortgage loans serviced, which is dependent upon market movements of interest rates.
 
December 31,
(in millions)
2017
 
2016
Prepayment rate:
 
 
 
Decline in fair value from a 50 basis point decrease in interest rates

$22

 

$9

Decline in fair value from a 100 basis point decrease in interest rates
46

 
25

Weighted-average discount rate:
 
 
 
Decline in fair value from a 50 basis point increase in weighted-average discount rate
4

 
3

Decline in fair value from a 100 basis point increase in weighted-average discount rate
8

 
6