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Related Party Transactions (Tables)
9 Months Ended
Sep. 30, 2019
Related Party Transactions [Abstract]  
Summary of Related Party Transactions
The following tables present related party balances and the income (expense) generated by related party transactions:

September 30, 2019

December 31, 2018
 
(in millions)
Assets:
 
 
 
Cash and due from banks
$
486

 
$
245

Interest bearing deposits with banks
1,484

 
1,000

Securities purchased under agreements to resell(1)
1,341

 

Trading assets
98

 
102

Loans
2,828

 
2,274

Other(2)
239

 
169

Total assets
$
6,476

 
$
3,790

Liabilities:
 
 
 
Deposits
$
11,543

 
$
12,000

Trading liabilities
1,087

 
349

Short-term borrowings
4,964

 
638

Long-term debt
7,847

 
7,845

Other(2)
284

 
333

Total liabilities
$
25,725

 
$
21,165

 

(1) 
Reflects purchases of securities under which other HSBC affiliates have agreed to repurchase.
(2) 
Other assets and other liabilities primarily consist of derivative balances associated with hedging activities and other miscellaneous account receivables and payables.
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2019
 
2018
 
2019
 
2018
 
(in millions)
Income (Expense):
 
 
 
 
 
 
 
Interest income
$
44

 
$
26

 
$
134

 
$
72

Interest expense
(151
)
 
(96
)
 
(427
)
 
(264
)
Net interest expense
(107
)
 
(70
)
 
(293
)
 
(192
)
Trading revenue (expense)
551

 
(504
)
 
(972
)
 
27

Servicing and other fees from HSBC affiliates:
 
 
 
 
 
 
 
HSBC Bank plc
40

 
48

 
121

 
132

HSBC Markets (USA) Inc. ("HMUS")
27

 
31

 
84

 
92

Other HSBC affiliates
21

 
24

 
52

 
65

Total servicing and other fees from HSBC affiliates
88

 
103

 
257

 
289

Gain (loss) on instruments designated at fair value and related derivatives
98

 
241

 
1,518

 
(62
)
Support services from HSBC affiliates:
 
 
 
 
 
 
 
HSBC Technology & Services (USA) ("HTSU")
(274
)
 
(301
)
 
(849
)
 
(909
)
HMUS
(24
)
 
(22
)
 
(74
)
 
(78
)
Other HSBC affiliates
(96
)
 
(76
)
 
(262
)
 
(228
)
Total support services from HSBC affiliates
(394
)
 
(399
)
 
(1,185
)
 
(1,215
)
Rental income from HSBC affiliates, net(1)
16

 
10

 
40

 
36

Stock based compensation expense(2)
(6
)
 
(6
)
 
(20
)
 
(21
)

 

(1) 
We receive rental income from our affiliates, and in some cases pay rental expense to our affiliates, for rent on certain office space. Net rental income from our affiliates is recorded as a component of occupancy expense, net in our consolidated statement of income (loss).
(2) 
Employees may participate in one or more stock compensation plans sponsored by HSBC. These expenses are included in salaries and employee benefits in our consolidated statement of income (loss). Certain employees are also eligible to participate in a defined benefit pension plan and other postretirement plans sponsored by HSBC North America which are discussed in Note 12, "Pension and Other Postretirement Benefits."
Schedule of Assets by Related Party
At September 30, 2019 and December 31, 2018, we had the following loan balances outstanding with HSBC affiliates:
 
September 30, 2019
 
December 31, 2018
 
(in millions)
HMUS and subsidiaries
$
2,453

 
$
2,235

Other short-term affiliate lending
375

 
39

Total loans
$
2,828

 
$
2,274