Investment Securities (Tables)

3 Months Ended

Mar. 31, 2014

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:



	March 31, 2014								December 31, 2013
	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	$	1,959	$	10	$	6	$	1,963	$	702	$	9	$	2	$	709
Mortgage-backed securities	23,176		206		290		23,092		23,744		211		392		23,563
Asset-backed securities:
Student loans⁽¹⁾	14,355		128		203		14,280		14,718		92		268		14,542
Credit cards	7,253		21		37		7,237		8,230		21		41		8,210
Sub-prime	1,234		3		82		1,155		1,291		3		91		1,203
Other	4,767		133		20		4,880		4,949		138		23		5,064
Total asset-backed securities	27,609		285		342		27,552		29,188		254		423		29,019
Non-U.S. debt securities:
Mortgage-backed securities	10,978		225		7		11,196		10,808		230		9		11,029
Asset-backed securities	4,973		23		2		4,994		5,369		23		2		5,390
Government securities	3,689		3		—		3,692		3,759		2		—		3,761
Other	4,931		62		9		4,984		4,679		59		11		4,727
Total non-U.S. debt securities	24,571		313		18		24,866		24,615		314		22		24,907
State and political subdivisions	10,345		216		117		10,444		10,301		160		198		10,263
Collateralized mortgage obligations	5,253		67		58		5,262		5,275		70		76		5,269
Other U.S. debt securities	4,827		139		20		4,946		4,876		138		34		4,980
U.S. equity securities	29		7		—		36		28		6		—		34
Non-U.S. equity securities	1		—		—		1		1		—		—		1
U.S. money-market mutual funds	993		—		—		993		422		—		—		422
Non-U.S. money-market mutual funds	7		—		—		7		7		—		—		7
Total	$	98,770	$	1,243	$	851	$	99,162	$	99,159	$	1,162	$	1,147	$	99,174
Held to maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	5,096	$	—	$	328	$	4,768	$	5,041	$	—	$	448	$	4,593
Mortgage-backed securities	81		6		—		87		91		6		—		97
Asset-backed securities:
Student loans⁽¹⁾	1,889		5		2		1,892		1,627		—		10		1,617
Credit cards	897		3		—		900		762		1		—		763
Other	738		1		1		738		782		1		2		781
Total asset-backed securities	3,524		9		3		3,530		3,171		2		12		3,161
Non-U.S. debt securities:
Mortgage-backed securities	4,323		172		29		4,466		4,211		150		48		4,313
Asset-backed securities	2,399		19		—		2,418		2,202		19		—		2,221
Government securities	2		—		—		2		2		—		—		2
Other	192		—		—		192		192		—		—		192
Total non-U.S. debt securities	6,916		191		29		7,078		6,607		169		48		6,728
State and political subdivisions	16		—		—		16		24		1		—		25
Collateralized mortgage obligations	2,709		163		25		2,847		2,806		176		26		2,956
Total	$	18,342	$	369	$	385	$	18,326	$	17,740	$	354	$	534	$	17,560

⁽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
March 31, 2014	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	$	1,433	$	5	$	130	$	1	$	1,563	$	6
Mortgage-backed securities	9,475		197		3,161		93		12,636		290
Asset-backed securities:
Student loans	606		5		7,271		198		7,877		203
Credit cards	3,311		26		214		11		3,525		37
Sub-prime	—		—		1,106		82		1,106		82
Other	1,997		10		418		10		2,415		20
Total asset-backed securities	5,914		41		9,009		301		14,923		342
Non-U.S. debt securities:
Mortgage-backed securities	819		2		326		5		1,145		7
Asset-backed securities	280		1		71		1		351		2
Other	1,652		6		149		3		1,801		9
Total non-U.S. debt securities	2,751		9		546		9		3,297		18
State and political subdivisions	1,850		49		1,311		68		3,161		117
Collateralized mortgage obligations	1,444		34		551		24		1,995		58
Other U.S. debt securities	783		13		60		7		843		20
Total	$	23,650	$	348	$	14,768	$	503	$	38,418	$	851
Held to maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	4,751	$	328	$	—	$	—	$	4,751	$	328
Asset-backed securities:
Student loans	297		1		176		1		473		2
Other	129		1		—		—		129		1
Total asset-backed securities	426		2		176		1		602		3
Non-U.S. mortgage-backed securities	906		2		825		27		1,731		29
Collateralized mortgage obligations	595		11		407		14		1,002		25
Total	$	6,678	$	343	$	1,408	$	42	$	8,086	$	385



	Less than 12 months				12 months or longer				Total
December 31, 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	$	182	$	1	$	113	$	1	$	295	$	2
Mortgage-backed securities	10,562		316		2,389		76		12,951		392
Asset-backed securities:
Student loans	1,930		16		7,252		252		9,182		268
Credit cards	3,714		30		161		11		3,875		41
Sub-prime	—		—		1,150		91		1,150		91
Other	1,896		12		439		11		2,335		23
Total asset-backed securities	7,540		58		9,002		365		16,542		423
Non-U.S. debt securities:
Mortgage-backed securities	868		2		258		7		1,126		9
Asset-backed securities	551		1		16		1		567		2
Other	1,655		9		150		2		1,805		11
Total non-U.S. debt securities	3,074		12		424		10		3,498		22
State and political subdivisions	3,242		113		1,268		85		4,510		198
Collateralized mortgage obligations	1,581		55		510		21		2,091		76
Other U.S. debt securities	1,039		25		58		9		1,097		34
Total	$	27,220	$	580	$	13,764	$	567	$	40,984	$	1,147
Held to maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	4,571	$	448	$	—	$	—	$	4,571	$	448
Asset-backed securities:
Student Loans	1,352		10		—		—		1,352		10
Other	297		1		29		1		326		2
Total asset-backed securities	1,649		11		29		1		1,678		12
Non-U.S. mortgage-backed securities	834		3		878		45		1,712		48
Collateralized mortgage obligations	759		18		161		8		920		26
Total	$	7,813	$	480	$	1,068	$	54	$	8,881	$	534

Investments Classified by Contractual Maturity Date

The following table presents contractual maturities of debt investment securities as of March 31, 2014:



(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	$	2	$	526	$	835	$	600
Mortgage-backed securities	183		2,387		5,276		15,246
Asset-backed securities:
Student loans	647		6,608		4,216		2,809
Credit cards	2,187		3,057		1,993		—
Sub-prime	7		20		1		1,127
Other	469		1,314		1,381		1,716
Total asset-backed securities	3,310		10,999		7,591		5,652
Non-U.S. debt securities:
Mortgage-backed securities	1,698		5,562		247		3,689
Asset-backed securities	355		3,906		599		134
Government securities	2,537		1,155		—		—
Other	1,658		2,625		701		—
Total non-U.S. debt securities	6,248		13,248		1,547		3,823
State and political subdivisions	672		3,122		4,049		2,601
Collateralized mortgage obligations	453		1,458		1,059		2,292
Other U.S. debt securities	437		3,761		715		33
Total	$	11,305	$	35,501	$	21,072	$	30,247
Held to maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	—	$	—	$	5,000	$	96
Mortgage-backed securities	—		19		16		46
Asset-backed securities
Student loans	19		192		383		1,295
Credit cards	—		335		562		—
Other	23		447		263		5
Total asset-backed securities	42		974		1,208		1,300
Non-U.S. debt securities:
Mortgage-backed securities	23		1,191		194		2,915
Asset-backed securities	70		2,085		244		—
Government securities	2		—		—		—
Other	166		25		—		1
Total non-U.S. debt securities	261		3,301		438		2,916
State and political subdivisions	13		3		—		—
Collateralized mortgage obligations	238		960		496		1,015
Total	$	554	$	5,257	$	7,158	$	5,373

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 March 31,
(In millions)	2014			2013
Gross realized gains from sales of available-for-sale securities	$	15		$	57
Gross realized losses from sales of available-for-sale securities	—			(52		)
Net impairment losses:
Gross losses from other-than-temporary impairment	(1		)	—
Losses reclassified (from) to other comprehensive income	(8		)	(3		)
Net impairment losses⁽¹⁾	(9		)	(3		)
Gains related to investment securities, net	$	6		$	2
⁽¹⁾ Net impairment losses, recognized in our consolidated statement of income, were composed of the following:
Impairment associated with expected credit losses	$	(9	)	$	—
Impairment associated with adverse changes in timing of expected future cash flows	—			(3		)
Net impairment losses	$	(9	)	$	(3	)

Schedule of Credit-Related Loss Activity Recognized in Earnings

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



	Three Months Ended March 31,
(In millions)	2014			2013
Beginning balance	$	122		$	124
Plus losses for which other-than-temporary impairment was previously recognized	9			3
Less previously recognized losses related to securities sold or matured	(1		)	—
Less losses related to securities intended or required to be sold	(6		)	—
Ending balance	$	124		$	127

- 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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