NOTE 10—DEPOSITS AND BORROWINGS

Deposits

Our deposits, which are our largest source of funding for our asset growth and operations, consist of non-interest bearing and interest-bearing deposits, which include checking accounts, money market deposit accounts, negotiable order of withdrawals, savings deposits and time deposits.

We had $191.9 billion and $180.5 billion in interest-bearing deposits as of December 31, 2015 and 2014, respectively. Time deposits issued by domestic offices totaled $12.2 billion and $8.3 billion as of December 31, 2015 and 2014, respectively. Of these deposits, the amount of domestic time deposits with a denomination of $100,000 or more was $1.9 billion and $2.3 billion as of December 31, 2015 and 2014, respectively. Time deposits issued by foreign offices totaled $843 million and $977 million as of December 31, 2015 and 2014, respectively. Substantially all of our foreign time deposits were greater than $100,000 as of December 31, 2015 and 2014.

Securitized and Unsecured Debt Obligations

We use a variety of funding sources other than deposits, including short-term borrowings, the issuance of senior and subordinated notes and other borrowings, and securitization transactions. In addition, we utilize FHLB advances, which are secured by certain portions of our loan and investment securities portfolios, for our funding needs. The securitized debt obligations are separately presented on our consolidated balance sheets, while federal funds purchased and securities loaned or sold under agreements to repurchase, senior and subordinated notes and other borrowings, including FHLB advances, are included in other debt on our consolidated balance sheets.

Securitized Debt Obligations

Our outstanding borrowings due to securitization investors were $16.2 billion and $11.6 billion as of December 31, 2015 and December 31, 2014, respectively. During 2015, approximately $5.1 billion of new debt was issued to third-party investors from our credit card loan securitization trust, offset by $500 million of debt maturities.

Senior and Subordinated Notes

As of December 31, 2015, we had $21.8 billion of senior and subordinated notes outstanding, inclusive of fair value hedging losses of $134 million. As of December 31, 2014, we had $18.7 billion of senior and subordinated notes outstanding, inclusive of fair value hedging losses of $179 million. During 2015, we issued $6.0 billion of long-term senior unsecured debt comprised of $700 million of floating-rate notes and $5.3 billion of fixed-rate notes. During 2015, $2.8 billion of outstanding unsecured notes matured. See “Note 11—Derivative Instruments and Hedging Activities” for information about our fair value hedging activities.

FHLB Advances and Other

In addition to the issuance capacity under the registration statement, we also have access to funding through the FHLB system and the Federal Reserve Discount Window. Our FHLB and Federal Reserve memberships require us to hold FHLB and Federal Reserve stock which totaled $2.1 billion and $2.0 billion as of December 31, 2015 and 2014, respectively, and are included in other assets on our consolidated balance sheets.

Our FHLB advances and lines of credit are secured by our investment securities, residential home loans, multifamily real estate loans, commercial real estate loans and HELOCs. The outstanding FHLB advances totaled $20.1 billion as of December 31, 2015, substantially all of which represented long-term advances generally callable on a quarterly basis, and $17.3 billion as of December 31, 2014, which was substantially comprised of short-term advances.

We have access to short-term borrowings through the Federal Reserve. Our membership with the Federal Reserve is secured by our investment in Federal Reserve stock, totaling $1.2 billion as of both December 31, 2015 and 2014. On an annual basis, we process immaterial overnight test trades to ensure continued system functionality and borrowing capabilities. We did not access the Federal Reserve Discount Window for funding during 2015 or 2014.

Composition of Deposits, Short-Term Borrowings and Long-Term Debt

The table below summarizes the components of our deposits, short-term borrowings and long-term debt as of December 31, 2015 and 2014. Our total short-term borrowings consist of federal funds purchased and securities loaned or sold under agreements to repurchase and other short-term borrowings with an original contractual maturity of one year or less. Our long-term debt consists of borrowings with an original contractual maturity of greater than one year. The amounts presented for outstanding borrowings include unamortized debt premiums and discounts, net of fair value hedge accounting adjustments.

Table 10.1: Components of Deposits, Short-Term Borrowings and Long-Term Debt



(Dollars in millions)	December 31, 2015		December 31, 2014
Deposits:
Non-interest bearing deposits	$	25,847	$	25,081
Interest-bearing deposits	191,874		180,467
Total deposits	$	217,721	$	205,548
Short-term borrowings:
Federal funds purchased and securities loaned or sold under agreements to repurchase	$	981	$	880
FHLB advances	0		16,200
Total short-term borrowings	$	981	$	17,080



	December 31, 2015
(Dollars in millions)	Maturity Dates	Interest Rates	Weighted- Average Interest Rate	Outstanding Amount		December 31, 2014
Long-term debt:
Securitized debt obligations⁽¹⁾	2016 - 2025	0.37 - 5.75%	1.46%	$	16,166	$	11,624
Senior and subordinated notes:⁽¹⁾
Fixed unsecured senior debt	2016 - 2025	1.15 - 6.75%	2.72	16,559		15,174
Floating unsecured senior debt	2016 - 2018	0.86 - 1.51%	1.11	1,198		880
Total unsecured senior debt			2.61	17,757		16,054
Fixed unsecured subordinated debt	2016 - 2025	3.38 - 8.80%	4.70	4,080		2,630
Total senior and subordinated notes				21,837		18,684
Other long-term borrowings:
FHLB advances	2016 - 2025	0.28 - 6.41%	0.40	20,098		1,069
Capital lease obligations	2016 - 2035	3.09 - 12.86%	4.17	33		0
Total other long-term borrowings				20,131		1,069
Total long-term debt				$	58,134	$	31,377
Total short-term borrowings and long-term debt				$	59,115	$	48,457

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⁽¹⁾	Outstanding amount includes the impact from hedge accounting.

Interest-bearing deposits, securitized debt obligations and other debt as of December 31, 2015 mature as follows:

Table 10.2: Maturity Profile of Borrowings and Debt



(Dollars in millions)	2016		2017		2018		2019		2020		Thereafter		Total
Interest-bearing time deposits⁽¹⁾	$	4,864	$	2,080	$	1,992	$	1,544	$	2,479	$	121	$	13,080
Securitized debt obligations	3,519		7,234		2,361		1,136		1,564		352		16,166
Federal funds purchased and securities loaned or sold under agreements to repurchase	981		0		0		0		0		0		981
Senior and subordinated notes	2,430		3,082		4,674		3,834		0		7,817		21,837
Other borrowings	19		19		11		2		1,001		19,079		20,131
Total	$	11,813	$	12,415	$	9,038	$	6,516	$	5,044	$	27,369	$	72,195

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⁽¹⁾	Includes only those interest-bearing deposits which have a contractual maturity date.

Components of Interest Expense

The following table displays interest expense attributable to short-term borrowings and long-term debt for the years ended December 31, 2015, 2014 and 2013:

Table 10.3: Components of Interest Expense on Short-Term Borrowings and Long-Term Debt



	Year Ended December 31,
(Dollars in millions)	2015		2014		2013
Short-term borrowings:
Federal funds purchased and securities loaned or sold under agreements to repurchase	$	1	$	2	$	1
FHLB advances	9		19		28
Total short-term borrowings	10		21		29
Long-term debt:
Securitized debt obligations⁽¹⁾	151		145		183
Senior and subordinated notes⁽¹⁾	330		299		315
Other long-term borrowings	43		26		24
Total long-term debt	524		470		522
Total interest expense on short-term borrowings and long-term debt	$	534	$	491	$	551

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⁽¹⁾	Interest expense includes the impact from hedge accounting.