Investment Securities (Tables)

9 Months Ended

Sep. 30, 2013

Investments, Debt and Equity Securities [Abstract]

The following table presents the amortized cost and fair value, and associated unrealized gains and losses, of investment securities as of the dates indicated:



	September 30, 2013								December 31, 2012
	Amortized Cost		Gross Unrealized				Fair Value		Amortized Cost		Gross Unrealized				Fair Value
(In millions)			Gains		Losses						Gains		Losses
Available for sale:
U.S. Treasury and federal agencies:
Direct obligations	$	729	$	11	$	2	$	738	$	823	$	19	$	1	$	841
Mortgage-backed securities	24,562		275		262		24,575		31,640		598		26		32,212
Asset-backed securities:
Student loans⁽¹⁾	15,079		94		302		14,871		16,829		100		508		16,421
Credit cards	8,649		23		46		8,626		9,928		61		3		9,986
Sub-prime	1,371		5		110		1,266		1,557		4		162		1,399
Other	4,772		148		19		4,901		4,583		155		61		4,677
Total asset-backed securities	29,871		270		477		29,664		32,897		320		734		32,483
Non-U.S. debt securities:
Mortgage-backed securities	10,773		241		13		11,001		11,119		313		27		11,405
Asset-backed securities	5,445		25		3		5,467		6,180		42		4		6,218
Government securities	3,537		4		—		3,541		3,197		2		—		3,199
Other	4,556		58		14		4,600		4,221		86		1		4,306
Total non-U.S. debt securities	24,311		328		30		24,609		24,717		443		32		25,128
State and political subdivisions	9,307		171		180		9,298		7,384		234		67		7,551
Collateralized mortgage obligations	5,152		79		73		5,158		4,818		151		15		4,954
Other U.S. debt securities	4,925		153		33		5,045		5,072		233		7		5,298
U.S. equity securities	34		5		—		39		28		3		—		31
Non-U.S. equity securities	2		—		—		2		1		—		—		1
U.S. money-market mutual funds	680		—		—		680		1,062		—		—		1,062
Non-U.S. money-market mutual funds	174		—		—		174		121		—		—		121
Total	$	99,747	$	1,292	$	1,057	$	99,982	$	108,563	$	2,001	$	882	$	109,682
Held to maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	5,003	$	—	$	390	$	4,613	$	5,000	$	—	$	8	$	4,992
Mortgage-backed securities	100		7		—		107		153		11		—		164
Asset-backed securities:
Student loans⁽¹⁾	1,502		—		11		1,491		—		—		—		—
Credit cards	531		—		—		531		—		—		—		—
Other	818		—		3		815		16		—		—		16
Total asset-backed securities	2,851		—		14		2,837		16		—		—		16
Non-U.S. debt securities:
Mortgage-backed securities	4,109		130		67		4,172		3,122		85		68		3,139
Asset-backed securities	1,486		18		2		1,502		434		16		1		449
Government securities	16		—		—		16		3		—		—		3
Other	190		—		—		190		167		—		2		165
Total non-U.S. debt securities	5,801		148		69		5,880		3,726		101		71		3,756
State and political subdivisions	61		1		—		62		74		2		—		76
Collateralized mortgage obligations	2,882		193		31		3,044		2,410		259		12		2,657
Total	$	16,698	$	349	$	504	$	16,543	$	11,379	$	373	$	91	$	11,661

⁽¹⁾Substantially composed of securities guaranteed by the federal government with respect to at least 97% of defaulted principal and

accrued interest on the underlying loans.

Schedule of Gross Pre-tax Unrealized Losses on Investment Securities

The following tables present the aggregate fair values of investment securities that have been in a continuous unrealized loss position for less than 12 months, and those that have been in a continuous unrealized loss position for 12 months or longer, as of the dates indicated:



	Less than 12 months				12 months or longer				Total
September 30, 2013	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
(In millions)	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
Available for sale:
U.S. Treasury and federal agencies:
Direct obligations	$	158	$	1	$	117	$	1	$	275	$	2
Mortgage-backed securities	9,721		232		1,933		30		11,654		262
Asset-backed securities:
Student loans	2,123		19		7,463		283		9,586		302
Credit cards	3,734		46		—		—		3,734		46
Sub-prime	16		1		1,193		109		1,209		110
Other	896		5		469		14		1,365		19
Total asset-backed securities	6,769		71		9,125		406		15,894		477
Non-U.S. debt securities:
Mortgage-backed securities	1,240		3		242		10		1,482		13
Asset-backed securities	708		1		21		2		729		3
Other	1,434		14		—		—		1,434		14
Total non-U.S. debt securities	3,382		18		263		12		3,645		30
State and political subdivisions	2,436		118		1,080		62		3,516		180
Collateralized mortgage obligations	1,665		65		304		8		1,969		73
Other U.S. debt securities	1,047		27		33		6		1,080		33
Total	$	25,178	$	532	$	12,855	$	525	$	38,033	$	1,057
Held to maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	4,611	$	390	$	—	$	—	$	4,611	$	390
Asset-backed securities:
Student loans	1,234		11		—		—		1,234		11
Other	580		3		—		—		580		3
Total asset-backed securities	1,814		14		—		—		1,814		14
Non-U.S. debt securities:
Mortgage-backed securities	1,155		5		893		62		2,048		67
Asset-backed securities	717		2		—		—		717		2
Total non-U.S. debt securities	1,872		7		893		62		2,765		69
Collateralized mortgage obligations	905		27		96		4		1,001		31
Total	$	9,202	$	438	$	989	$	66	$	10,191	$	504



	Less than 12 months				12 months or longer				Total
December 31, 2012	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
(In millions)	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
Available for sale:
U.S. Treasury and federal agencies:
Direct obligations	$	—	$	—	$	132	$	1	$	132	$	1
Mortgage-backed securities	3,486		18		865		8		4,351		26
Asset-backed securities:
Student loans	625		6		10,241		502		10,866		508
Credit cards	888		3		—		—		888		3
Sub-prime	—		—		1,346		162		1,346		162
Other	639		13		989		48		1,628		61
Total asset-backed securities	2,152		22		12,576		712		14,728		734
Non-U.S. debt securities:
Mortgage-backed securities	670		3		453		24		1,123		27
Asset-backed securities	973		1		53		3		1,026		4
Other	509		1		—		—		509		1
Total non-U.S. debt securities	2,152		5		506		27		2,658		32
State and political subdivisions	685		9		1,152		58		1,837		67
Collateralized mortgage obligations	347		1		621		14		968		15
Other U.S. debt securities	302		1		33		6		335		7
Total	$	9,124	$	56	$	15,885	$	826	$	25,009	$	882
Held to maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	3,792	$	8	$	—	$	—	$	3,792	$	8
Non-U.S. debt securities:
Mortgage-backed securities	56		1		956		67		1,012		68
Asset-backed securities	—		—		73		1		73		1
Other	—		—		156		2		156		2
Total non-U.S. debt securities	56		1		1,185		70		1,241		71
Collateralized mortgage obligations	120		1		153		11		273		12
Total	$	3,968	$	10	$	1,338	$	81	$	5,306	$	91

Investments Classified by Contractual Maturity Date

The following table presents contractual maturities of debt investment securities as of September 30, 2013:



(In millions)	Under 1 Year		1 to 5 Years		6 to 10 Years		Over 10 Years
Available for sale:
U.S. Treasury and federal agencies:
Direct obligations	$	—	$	42	$	46	$	650
Mortgage-backed securities	103		1,847		6,188		16,437
Asset-backed securities:
Student loans	1,019		6,513		4,646		2,693
Credit cards	2,919		3,506		2,201		—
Sub-prime	26		28		2		1,210
Other	341		1,758		1,432		1,370
Total asset-backed securities	4,305		11,805		8,281		5,273
Non-U.S. debt securities:
Mortgage-backed securities	148		6,191		159		4,503
Asset-backed securities	253		4,685		378		151
Government securities	2,541		1,000		—		—
Other	1,143		2,912		545		—
Total non-U.S. debt securities	4,085		14,788		1,082		4,654
State and political subdivisions	668		3,059		3,565		2,006
Collateralized mortgage obligations	271		1,923		1,157		1,807
Other U.S. debt securities	215		4,094		703		33
Total	$	9,647	$	37,558	$	21,022	$	30,860
Held to maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	—	$	—	$	5,000	$	3
Mortgage-backed securities	—		25		19		56
Asset-backed securities
Student loans	19		153		219		1,111
Credit cards	—		229		302		—
Other	—		510		302		6
Total asset-backed securities	19		892		823		1,117
Non-U.S. debt securities:
Mortgage-backed securities	—		939		164		3,006
Asset-backed securities	80		1,235		171		—
Government securities	16		—		—		—
Other	162		24		—		4
Total non-U.S. debt securities	258		2,198		335		3,010
State and political subdivisions	48		13		—		—
Collateralized mortgage obligations	102		1,174		502		1,104
Total	$	427	$	4,302	$	6,679	$	5,290

Gains and Losses Related to Investment Securities

The following table presents gross realized gains and gross realized losses from sales of available-for-sale securities and the components of net impairment losses, included in net gains and losses related to investment securities, for the periods indicated:



	Three Months Ended September 30,						Nine Months Ended September 30,
(In millions)	2013			2012			2013			2012
Gross realized gains from sales of available-for-sale securities	$	11		$	24		$	98		$	75
Gross realized losses from sales of available-for-sale securities⁽¹⁾	(5		)	—			(87		)	(46		)

Gross losses from other-than-temporary impairment	(8		)	(4		)	(8		)	(50		)
Losses reclassified (from) to other comprehensive income	(2		)	(2		)	(12		)	23
Net impairment losses recognized in consolidated statement of income	(10		)	(6		)	(20		)	(27		)
Gains (losses) related to investment securities, net	$	(4	)	$	18		$	(9	)	$	2

Impairment associated with expected credit losses	$	(8	)	$	(1	)	$	(8	)	$	(14	)
Impairment associated with management's intent to sell impaired securities prior to recovery in value	—			—			(6		)	—
Impairment associated with adverse changes in timing of expected future cash flows	(2		)	(5		)	(6		)	(13		)
Net impairment losses recognized in consolidated statement of income	$	(10	)	$	(6	)	$	(20	)	$	(27	)

⁽¹⁾Amount for the nine months ended September 30, 2012 represented a pre-tax loss from the sale of all of our Greek investment securities, which had an aggregate carrying value of approximately $91 million.

Schedule of Credit-Related Loss Activity Recognized in Earnings

The following table presents activity with respect to net impairment losses for the periods indicated:



	Nine Months Ended September 30,
(In millions)	2013			2012
Beginning balance	$	124		$	113
Plus losses for which other-than-temporary impairment was not previously recognized	14			2
Plus losses for which other-than-temporary impairment was previously recognized	6			25
Less previously recognized losses related to securities sold or matured	(10		)	(21		)
Ending balance	$	134		$	119

- Definition

Tabular disclosure of available-for-sale securities which includes, but is not limited to, changes in the cost basis and fair value, fair value and gross unrealized gain (loss), fair values by type of security, contractual maturity and classification, amortized cost basis, contracts to acquire securities to be accounted for as available-for-sale, debt maturities, transfers to trading, change in net unrealized holding gain (loss) net of tax, continuous unrealized loss position fair value, aggregate losses qualitative disclosures, other than temporary impairment (OTTI) losses or other disclosures related to available for sale securities.

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- Definition

Tabular disclosure of the realized and unrealized gains and losses reported in the statement of income which have resulted from the sale and holding of marketable securities, respectively, as well as the sale or disposal of cost method investments. Such amounts would include realized gains and losses on the sale or disposal of trading, available-for-sale, and held-to-maturity securities, unrealized gains and losses on trading securities, unrealized gains and losses on available-for-sale and held-to-maturity securities transferred to the trading securities category, realized gains and losses on the sale or disposal of cost method investments, and losses recognized for other than temporary impairments (OTTI) of such investments.

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- Definition

Tabular disclosure of marketable securities. This may consist of investments in certain debt and equity securities, short-term investments and other assets.

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- Definition

Tabular disclosure of the amount of other than temporary impairment (OTTI) related to credit losses recognized in earnings including: (a) the beginning balance of the amount related to credit losses on debt securities held by the investor at the beginning of the period for which a portion of an OTTI was recognized in other comprehensive income; (b) additions for the amount related to the credit loss for which an OTTI was not previously recognized; (c) reductions for securities sold during the period (realized); (d) reductions for securities for which the amount previously recognized in other comprehensive income was recognized in earnings because the investor intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis; (e) additional increases to the amount related to the credit loss for which an OTTI was previously recognized when the investor does not intend to sell the security and it is not more likely than not that the investor will be required to sell the security before recovery of its amortized cost basis; (f) reductions for increases in cash flows expected to be collected that are recognized over the remaining life of the security; and (g) the ending balance of the amount related to credit losses on debt securities held by the entity at the end of the period for which a portion of an OTTI was recognized in other comprehensive income.

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