Derivative Financial Instruments and Hedging Activities (Tables)

12 Months Ended

Dec. 31, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments

The table below presents the gross amounts of fair value of our derivative instruments and the associated notional amounts:

	December 31, 2019						December 31, 2018
	Notional		Fair Value of Assets(a)		Fair Value of Liabilities(a)		Notional		Fair Value of Assets(a)		Fair Value of Liabilities(a)
Derivatives designated as hedges
Fair value hedges
Interest rate swaps	$	9,458	$	234	$	23	$	9,533	$	42	$	231
Foreign currency swaps	1,796		22		71		1,829		37		60
Cash flow hedges
Interest rate swaps	590		—		6		768		8		—
Foreign currency swaps	4,429		40		119		2,075		43		58
Derivatives not designated as hedges
Interest rate contracts	92,400		340		300		99,666		372		520
Total(b)	$	108,673	$	636	$	519	$	113,871	$	502	$	869

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(a) The gross amounts of the fair value of our assets and liabilities are included in other assets and other liabilities, respectively. Amounts accrued for interest payments in a net receivable position are included in other assets. Amounts accrued for interest payments in a net payable position are included in other liabilities. All our derivatives are categorized within Level 2 of the fair value hierarchy. The fair value for Level 2 instruments was derived using the market approach based on observable market inputs including quoted prices of similar instruments and foreign exchange and interest rate forward curves.

(b) We primarily enter into derivative instruments through AmeriCredit Financial Services, Inc. (AFSI); however, our SPEs may also be parties to derivative instruments. Agreements between AFSI and its derivative counterparties include rights of setoff for positions with offsetting values or for collateral held or posted. At December 31, 2019 and December 31, 2018, the fair value of assets and liabilities available for offset was $302 million and $320 million. At December 31, 2019 and December 31, 2018, we held $210 million and $30 million of collateral from counterparties that is available for netting against our asset positions. At December 31, 2019 and December 31, 2018, we posted $89 million and $451 million of collateral to counterparties that is available for netting against our liability positions.

Schedule of Fair Value Hedging Instruments, Statements of Financial Performance and Financial Position, Location

he following amounts were recorded in the consolidated balance sheet related to items designated and qualifying as hedged items in fair value hedging relationships:

	Carrying Amount of Hedged Items				Cumulative Amount of Fair Value Hedging Adjustments(a)
	December 31, 2019		December 31, 2018		December 31, 2019			December 31, 2018
Unsecured debt	$	20,397	$	17,923	$	(77	)	$	459

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(a) Includes $69 million and $247 million at December 31, 2019 and December 31, 2018 of amortization remaining on hedged items for which hedge accounting has been discontinued.

Effect of Derivative Instruments on the Condensed Consolidated Statements of Income

The tables below present the effect of our derivative financial instruments in the consolidated statements of income:

	Years Ended December 31,
	2019						2018
	Interest Expense(a)			Operating Expenses(b)			Interest Expense(a)			Operating Expenses(b)
Fair value hedges
Hedged items - interest rate swaps	$	(569	)	$	—		$	83		$	—
Interest rate swaps	355			—			(102		)	—
Hedged items - foreign currency swaps	—			33			—			(17		)
Foreign currency swaps	(59		)	(28		)	(5		)	18
Cash flow hedges
Interest rate swaps	5			—			14			—
Foreign currency swaps	(87		)	3			(49		)	(114		)
Derivatives not designated as hedges
Interest rate contracts	142			—			26			—
Foreign currency swaps	—			—			(44		)	(142		)
Total (losses) income recognized	$	(213	)	$	8		$	(77	)	$	(255	)

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(a) Total interest expense was $3.6 billion and $3.2 billion for 2019 and 2018.

(b) Activity is offset by translation activity also recorded in operating expenses related to foreign currency-denominated loans. Total operating expenses were $1.6 billion and $1.5 billion for 2019 and 2018.

	Year Ended December 31, 2017
Fair value hedges
Interest rate swaps(a)(b)	$	42
Cash flow hedges
Interest rate swaps(a)	3
Foreign currency swaps(c)	121
Derivatives not designated as hedges
Interest rate contracts(a)	40
Foreign currency swaps(c)(d)	86
Total income recognized	$	292

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(a) Recognized in earnings as interest expense.

(b) Includes hedge ineffectiveness which reflects the net change in the fair value of interest rate swaps offset by the change in fair value of hedged debt attributable to the hedged risk.

(c) Recognized in earnings as operating expenses and interest expense.

(d) Activity is partially offset by translation activity (included in operating expenses) related to foreign currency-denominated loans.

The tables below present the effect of our derivative financial instruments in the consolidated statements of comprehensive income:

	Gains (Losses) Recognized In Accumulated Other Comprehensive Loss
	Years Ended December 31,
	2019			2018			2017
Fair value hedges
Foreign currency swaps	$	(41	)	$	(3	)	$	—
Cash flow hedges
Interest rate swaps	(6		)	3			5
Foreign currency swaps	(113		)	(89		)	81
Total	$	(160	)	$	(89	)	$	86

	(Gains) Losses Reclassified From Accumulated Other Comprehensive Loss Into Income(a)(b)
	Years Ended December 31,
	2019			2018			2017
Fair value hedges
Foreign currency swaps	$	41		$	3		$	—
Cash flow hedges
Interest rate swaps	(3		)	(7		)	(1		)
Foreign currency swaps	64			86			(86		)
Total	$	102		$	82		$	(87	)

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(a) All amounts reclassified from accumulated other comprehensive loss were recorded to interest expense.

(b) During the next twelve months, we estimate $26 million in gains will be reclassified into pretax earnings from derivatives designated for hedge accounting.