XML 47 R52.htm IDEA: XBRL DOCUMENT v2.4.0.6
Benefit Plans (Tables)
 12 Months Ended
Dec. 31, 2012
Benefit Plans  
Components of the plans' funded status reflected in the Consolidated Statements of Financial Position

 

 

($ in millions)
 
   Pension
benefits		   Postretirement
benefits		  
 
   2012   2011   2012   2011  

Fair value of plan assets

   $ 5,398   $ 4,675   $ —   $ —  

Less: Benefit obligation

     6,727     5,831     803     716  
                   

Funded status

   $ (1,329 ) $ (1,156 ) $ (803 ) $ (716 )
                   

Items not yet recognized as a component of net periodic cost:

                          

Net actuarial loss (gain)

   $ 2,892   $ 2,546   $ (115 ) $ (211 )

Prior service credit

     (1 )   (3 )   (129 )   (152 )
                   

Unrecognized pension and other postretirement benefit cost, pre-tax

    
2,891		    
2,543		    
(244
)		  
(363
)

Deferred income tax

     (1,012 )   (890 )   94     137  
                   

Unrecognized pension and other postretirement benefit cost

   $ 1,879   $ 1,653   $ (150 ) $ (226 )
                   
Change during the period in items not yet recognized as a component of net periodic cost

 

 

($ in millions)
 
   Pension
benefits		   Postretirement
benefits		  

Items not yet recognized as a component of net periodic cost —
December 31, 2011

   $ 2,543   $ (363 )

Net actuarial loss arising during the period

     555     76  

Net actuarial (loss) gain amortized to net periodic benefit cost

     (211 )   20  

Prior service cost arising during the period

     —     —  

Prior service credit amortized to net periodic benefit cost

     2     23  

Translation adjustment and other

     2     —  
           

Items not yet recognized as a component of net periodic cost —
December 31, 2012

   $ 2,891   $ (244 )
           
Estimates of the net actuarial loss (gain) and prior service credit expected to be recognized as a component of net periodic benefit cost in next fiscal year

 

 

($ in millions)
 
   Pension
benefits		   Postretirement
benefits		  

Net actuarial loss (gain)

   $ 261   $ (12 )

Prior service credit

     (2 )   (23 )
Changes in benefit obligations for all plans

 

 

($ in millions)
 
   Pension benefits   Postretirement
benefits		  
 
   2012   2011   2012   2011  

Benefit obligation, beginning of year

   $ 5,831   $ 5,545   $ 716   $ 628  

Service cost

     152     151     13     11  

Interest cost

     298     322     36     37  

Participant contributions

     1     1     20     20  

Actuarial loss

     756     337     76     82  

Benefits paid (1)

     (312 )   (511 )   (59 )   (61 )

Translation adjustment and other

     1     (14 )   1     (1 )
                   

Benefit obligation, end of year

   $ 6,727   $ 5,831   $ 803   $ 716  
                   
(1)
Benefits paid include lump sum distributions, a portion of which may trigger settlement accounting treatment.
Components of net periodic cost

 

 

 
   Pension benefits   Postretirement benefits  
($ in millions)
   2012   2011   2010   2012   2011   2010  

Service cost

   $ 152   $ 151   $ 150   $ 13   $ 11   $ 12  

Interest cost

     298     322     320     36     37     40  

Expected return on plan assets

     (393 )   (367 )   (331 )   —     —     —  

Amortization of:

                                      

Prior service credit

     (2 )   (2 )   (2 )   (23 )   (23 )   (22 )

Net actuarial loss (gain)

     178     154     160     (20 )   (30 )   (22 )

Settlement loss

     33     46     48     —     1     —  
                           

Net periodic cost (credit)

   $ 266   $ 304   $ 345   $ 6   $ (4 ) $ 8  
                           
Weighted average assumptions used to determine for pension plans and postretirement benefits plans the net benefit cost and benefit obligation

Weighted average assumptions used to determine net pension cost and net postretirement benefit cost for the years ended December 31 are:

 
   Pension benefits   Postretirement benefits  
($ in millions)
   2012   2011   2010   2012   2011   2010  

Discount rate

     5.25 %   6.00 %   6.25 %   5.25 %   6.00 %   6.25 %

Rate of increase in compensation levels

     4.5     4.0-4.5     4.0-4.5     n/a     n/a     n/a  

Expected long-term rate of return on plan assets

     8.5     8.5     8.5     n/a     n/a     n/a  

       Weighted average assumptions used to determine benefit obligations as of December 31 are listed in the following table.

 
   Pension benefits   Postretirement benefits  
 
   2012   2011   2012   2011  

Discount rate

     4.00 %   5.25 %   4.25 %   5.25 %

Rate of increase in compensation levels

     3.5     4.0-4.5     n/a     n/a  
Change in pension plan assets

 

 

($ in millions)
   2012   2011  

Fair value of plan assets, beginning of year

   $ 4,675   $ 4,669  

Actual return on plan assets

     594     267  

Employer contribution

     439     264  

Benefits paid

     (312 )   (511 )

Translation adjustment and other

     2     (14 )
           

Fair value of plan assets, end of year

   $ 5,398   $ 4,675  
           
Pension plans' target percentage of plan assets and the actual percentage of plan assets

 

 

 
   Target asset
allocation		   Actual percentage
of plan assets		  
Asset category
   2012   2012   2011  

Equity securities

     42 - 55 %   50 %   48 %

Fixed income securities

     35 - 48     38     38  

Limited partnership interests

     12 - 23     9     10  

Short-term investments and other

     1 - 3     3     4  
                 

Total (1)

           100 %   100 %
                 
(1)
Securities lending collateral reinvestment is excluded from target and actual percentage of plan assets.
Fair values of pension plan assets

 The following table presents the fair values of pension plan assets as of December 31, 2012.

($ in millions)





 
   Quoted prices
in active
markets for
identical
assets
(Level 1)		   Significant
other
observable
inputs
(Level 2)		   Significant
unobservable
inputs
(Level 3)		   Balance
as of
December 31,
2012		  

Assets

                          

Equity securities:

                          

U.S. 

   $ 13   $ 2,042   $ 68   $ 2,123  

International

     136     198     246     580  

Fixed income securities:

                          

U.S. government and agencies

     799     78     —     877  

Foreign government

     —     32     —     32  

Municipal

     —     —     129     129  

Corporate

     —     994     10     1,004  

RMBS

     —     95     —     95  

Short-term investments

     56     424     —     480  

Limited partnership interests:

                          

Real estate funds (1)

     —     —     214     214  

Private equity funds (2)

     —     —     199     199  

Hedge funds (3)

     —     —     80     80  

Cash and cash equivalents

     17     —     —     17  

Free-standing derivatives:

                          

Assets

     —     —     —     —  

Liabilities

     —     —     —     —  
                   

Total plan assets at fair value

   $ 1,021   $ 3,863   $ 946     5,830  
                     

% of total plan assets at fair value

     17.5 %   66.3 %   16.2 %   100.0 %

Securities lending obligation (4)

                      
(463
)

Other net plan assets (5)

                       31  
                         

Total reported plan assets

                     $ 5,398  
                         
(1)
Real estate funds held by the pension plans are primarily invested in U.S. commercial real estate.
(2)
Private equity funds held by the pension plans are primarily comprised of North American buyout funds.
(3)
Hedge funds held by the pension plans primarily comprise fund of funds investments in diversified pools of capital across funds with underlying strategies such as convertible arbitrage, equity market neutral, fixed income arbitrage, global macro, commodity trading advisors, long short equity, short biased equity, and event driven.
(4)
The securities lending obligation represents the plan's obligation to return securities lending collateral received under a securities lending program. The terms of the program allow both the plan and the counterparty the right and ability to redeem/return the securities loaned on short notice. Due to its relatively short-term nature, the outstanding balance of the obligation approximates fair value.
(5)
Other net plan assets represent interest and dividends receivable and net receivables related to settlements of investment transactions, such as purchases and sales.

       The following table presents the fair values of pension plan assets as of December 31, 2011.

($ in millions)





 
   Quoted prices
in active
markets for
identical
assets
(Level 1)		   Significant
other
observable
inputs
(Level 2)		   Significant
unobservable
inputs
(Level 3)		   Balance
as of
December 31,
2011		  

Assets

                          

Equity securities:

                          

U.S. 

   $ 11   $ 817   $ 64   $ 892  

International

     116     986     245     1,347  

Fixed income securities:

                          

U.S. government and agencies

     634     120     —     754  

Foreign government

     —     26     —     26  

Municipal

     —     —     163     163  

Corporate

     —     869     9     878  

RMBS

     —     119     —     119  

Short-term investments

     33     494     —     527  

Limited partnership interests:

                          

Real estate funds

     —     —     192     192  

Private equity funds

     —     —     186     186  

Hedge funds

     —     —     79     79  

Cash and cash equivalents

     18     —     —     18  

Free-standing derivatives:

                          

Assets

     1     2     —     3  

Liabilities

     (2 )   (4 )   —     (6 )
                   

Total plan assets at fair value

   $ 811   $ 3,429   $ 938     5,178  
                     

% of total plan assets at fair value

     15.7 %   66.2 %   18.1 %   100.0 %

Securities lending obligation

                      
(554
)

Other net plan assets

                       51  
                         

Total reported plan assets

                     $ 4,675  
                         
Rollforward of Level 3 plan assets

  The following table presents the rollforward of Level 3 plan assets for the year ended December 31, 2012.

($ in millions)
    
   Actual return on plan assets:    
    
    
  
 
   Balance as of
December 31,
2011		   Relating to
assets sold
during the
period		   Relating to
assets still
held at the
reporting
date		   Purchases,
sales and
settlements,
net		   Net transfers
in and/or
(out) of
Level 3		   Balance as of
December 31,
2012		  

Assets

                                      

Equity securities:

                                      

U. S. 

   $ 64   $ —   $ 7   $ (3 ) $ —   $ 68  

International

     245     —     1     —     —     246  

Fixed income securities:

                                      

Municipal

     163     5     (2 )   (37 )   —     129  

Corporate

     9     1     —     —     —     10  

Limited partnership interests:

                                      

Real estate funds

     192     16     2     4     —     214  

Private equity funds

     186     8     (6 )   11     —     199  

Hedge funds

     79     —     1     —     —     80  
                           

Total Level 3 plan assets

   $ 938   $ 30   $ 3   $ (25 ) $ —   $ 946  
                           

       The following table presents the rollforward of Level 3 plan assets for the year ended December 31, 2011.

($ in millions)
    
   Actual return on plan assets:    
    
    
  
 
   Balance as of
December 31,
2010		   Relating to
assets sold
during the
period		   Relating to
assets still
held at the
reporting
date		   Purchases,
sales and
settlements,
net		   Net transfers
in and/or
(out) of
Level 3		   Balance as of
December 31,
2011		  

Assets

                                      

Equity securities:

                                      

U. S. 

   $ 6   $ —   $ (2 ) $ 60   $ —   $ 64  

International

     253     —     (5 )   (3 )   —     245  

Fixed income securities:

                                      

Municipal

     222     —     1     (60 )   —     163  

Corporate

     10     1     —     (2 )   —     9  

RMBS

     48     (8 )   8     (30 )   (18 )   —  

Limited partnership interests:

                                      

Real estate funds

     167     (1 )   29     (3 )   —     192  

Private equity funds

     166     1     22     (3 )   —     186  

Hedge funds

     120     43     (43 )   (41 )   —     79  
                           

Total Level 3 plan assets

   $ 992   $ 36   $ 10   $ (82 ) $ (18 ) $ 938  
                           

       The following table presents the rollforward of Level 3 plan assets for the year ended December 31, 2010.

($ in millions)
    
   Actual return on plan assets:    
    
    
  
 
   Balance as of
December 31,
2009		   Relating to
assets sold
during the
period		   Relating to
assets still
held at the
reporting
date		   Purchases,
sales and
settlements,
net		   Net transfers
in and/or
(out) of
Level 3		   Balance as of
December 31,
2010		  

Assets

                                      

Equity securities:

                                      

U. S. 

   $ 4   $ —   $ 2   $ —   $ —   $ 6  

International

     233     1     7     12     —     253  

Fixed income securities:

                                      

Municipal

     344     —     (2 )   (114 )   (6 )   222  

Corporate

     10     —     —     —     —     10  

ABS

     32     (1 )   —     (31 )   —     —  

RMBS

     61     (10 )   23     (26 )   —     48  

Limited partnership interests:

                                      

Real estate funds

     135     (4 )   3     33     —     167  

Private equity funds

     149     —     19     (2 )   —     166  

Hedge funds

     135     (59 )   66     (22 )   —     120  
                           

Total Level 3 plan assets

   $ 1,103   $ (73 ) $ 118   $ (150 ) $ (6 ) $ 992  
                           
Estimated future benefit payments expected to be paid

 

 

($ in millions)
   Postretirement benefits  
 
   Pension
benefits		   Gross
benefit
payments		  

2013

   $ 318   $ 44  

2014

     345     45  

2015

     357     47  

2016

     383     48  

2017

     417     50  

2018-2022

     2,483     275  
           

Total benefit payments

   $ 4,303   $ 509  
           
Schedule of ESOP benefit

 

 

($ in millions)
   2012   2011   2010  

Interest expense recognized by ESOP

   $ 2   $ 2   $ 2  

Less: dividends accrued on ESOP shares

     (2 )   (2 )   (2 )

Cost of shares allocated

     2     2     2  
               

Compensation expense

     2     2     2  

Reduction of defined contribution due to ESOP

     10     9     11  
               

ESOP benefit

   $ (8 ) $ (7 ) $ (9 )