Derivative Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Outstanding Hedges: (Notional Amount)

The following table presents the aggregate contractual, or notional, amounts of derivative financial instruments entered into in connection with our trading and asset-and-liability management activities as of the dates indicated:

(In millions)	March 31, 2015		December 31, 2014
Derivatives not designated as hedging instruments:
Interest-rate contracts:
Swap agreements and forwards	$	474	$	645
Options and caps purchased	4		7
Options and caps written	4		7
Futures	2,969		3,939
Foreign exchange contracts:
Forward, swap and spot	1,414,506		1,231,344
Options purchased	3,008		2,767
Options written	2,905		2,404
Futures	21		—
Credit derivative contracts:
Credit swap agreements	226		191
Commodity and equity contracts:
Commodity(1)	61		26
Equity(1)	92		2
Other:
Stable value contracts	23,425		23,409
Deferred value awards(2)	417		210
Derivatives designated as hedging instruments:
Interest-rate contracts:
Swap agreements	6,065		6,077
Foreign exchange contracts:
Forward and swap	2,605		2,705

⁽¹⁾ Primarily composed of positions held by a consolidated sponsored investment fund, more fully described in note 9.

⁽²⁾ Represents grants of deferred value awards to employees; refer to discussion in this note under "Derivatives Not Designated as Hedging Instruments."

Notional Amount of Interest Rate Swap Agreements Designated as Fair Value and Cash Flow Hedges

The following table presents the aggregate notional amounts of these interest-rate contracts and the related assets or liabilities being hedged as of the dates indicated:

	March 31, 2015(1)
(In millions)	Fair Value Hedges
Investment securities available for sale	$	2,565
Long-term debt(2)	3,500
Total	$	6,065

	December 31, 2014
(In millions)	Fair Value Hedges
Investment securities available for sale	$	2,577
Long-term debt(2)	3,500
Total	$	6,077

⁽¹⁾ As of March 31, 2015 there were no interest-rate contracts designated as cash flow hedges.

⁽²⁾ As of March 31, 2015, these fair value hedges increased the carrying value of long-term debt presented in our consolidated statement of condition by $135 million. As of December 31, 2014, these fair value hedges decreased the carrying value of long-term debt presented in our consolidated statement of condition by $76 million.

Contractual and Weighted-Average Interest Rates, Which Include the Effects of Hedges Related to Financial Instruments

The following tables present the contractual and weighted-average interest rates for long-term debt, which include the effects of the fair value hedges presented in the table above, for the periods indicated:

	Three Months Ended March 31,
	2015				2014
	Contractual Rates		Rate  Including Impact of Hedges		Contractual Rates		Rate  Including Impact of Hedges
Long-term debt	3.53	%	2.54	%	3.39	%	2.60	%

Schedule of the Fair Values of Derivative Financial Instruments

The following tables present the fair value of derivative financial instruments, excluding the impact of master netting agreements, recorded in our consolidated statement of condition as of the dates indicated. The impact of master netting agreements is disclosed in note 2.

Derivative Assets(1)
	Fair Value
(In millions)	March 31, 2015		December 31, 2014
Derivatives not designated as hedging instruments:
Foreign exchange contracts	$	15,610	$	14,626
Interest-rate contracts	12		15
Other derivative contracts	3		2
Total	$	15,625	$	14,643
Derivatives designated as hedging instruments:
Foreign exchange contracts	$	506	$	509
Interest-rate contracts	129		62
Total	$	635	$	571

⁽¹⁾ Derivative assets are included within other assets in our consolidated statement of condition.

Derivative Liabilities(1)
	Fair Value
(In millions)	March 31, 2015		December 31, 2014
Derivatives not designated as hedging instruments:
Foreign exchange contracts	$	17,053	$	14,922
Other derivative contracts	112		70
Interest-rate contracts	12		16
Total	$	17,177	$	15,008
Derivatives designated as hedging instruments:
Interest-rate contracts	$	220	$	223
Foreign exchange contracts	—		3
Total	$	220	$	226

⁽¹⁾ Derivative liabilities are included within other liabilities in our consolidated statement of condition.

Impact of Derivatives on Consolidated Statement of Income

The following tables present the impact of our use of derivative financial instruments on our consolidated statement of income for the periods indicated:

	Location of Gain (Loss) on Derivative in Consolidated Statement of Income	Amount of Gain (Loss) on Derivative Recognized in Consolidated Statement of Income
		Three Months Ended March 31,
(In millions)		2015		2014
Derivatives not designated as hedging instruments:
Foreign exchange contracts	Trading services revenue	$	204	$	134
Interest-rate contracts	Processing fees and other revenue	1		—
Other derivative contracts	Trading services revenue	2		(1		)
Total		$	207	$	133

	Location of (Gain) Loss on Derivative in Consolidated Statement of Income	Amount of (Gain) Loss on Derivative Recognized in Consolidated Statement of Income
		Three Months Ended March 31,
(In millions)		2015		2014
Derivatives not designated as hedging instruments:
Other derivative contracts	Compensation and employee benefits	$	59	$	49
Total		$	59	$	49

Schedule of Differences Between the Gains (Losses) on the Derivative and the Gains (Losses) on the Hedged Item

	Location of Gain (Loss) on Derivative in Consolidated Statement of Income	Amount of Gain (Loss) on Derivative Recognized in Consolidated Statement of Income						Hedged Item in Fair Value Hedging Relationship	Location of Gain (Loss) on Hedged Item in Consolidated Statement of Income	Amount of Gain (Loss) on Hedged Item Recognized in Consolidated Statement of Income
		Three Months Ended March 31,								Three Months Ended March 31,
(In millions)		2015			2014					2015			2014
Derivatives designated as fair value hedges:
Foreign exchange contracts	Processing fees and other revenue	$	(67	)	42			Investment securities	Processing fees and other revenue	$	67		$	(42	)
Interest-rate contracts	Processing fees and other revenue	(25		)	(12		)	Available-for-sale securities	Processing fees and other revenue(1)	25			12
Interest-rate contracts	Processing fees and other revenue	68			49			Long-term debt	Processing fees and other revenue	(65		)	(45		)
Total		$	(24	)	$	79				$	27		$	(75	)

⁽¹⁾ Represents amounts reclassified out of or into other comprehensive income, or OCI. For the three months endedMarch 31, 2015, $15 million of unrealized losses on available-for-sale securities designated in fair value hedges were recognized in OCI. For the three months endedMarch 31, 2014, $10 million of unrealized gains on available-for-sale securities designated in fair value hedges were recognized in OCI.

Differences between the gains (losses) on the derivative and the gains (losses) on the hedged item, excluding any amounts recorded in net interest revenue, represent hedge ineffectiveness.

	Amount of Gain (Loss) on Derivative Recognized in Other Comprehensive Income					Location of Gain (Loss) Reclassified from OCI to Consolidated Statement of Income	Amount of Gain (Loss) Reclassified from OCI to Consolidated Statement of Income						Location of Gain (Loss) on Derivative Recognized in Consolidated Statement of Income	Amount of Gain (Loss) on Derivative Recognized in Consolidated Statement of Income
	Three Months Ended March 31,						Three Months Ended March 31,							Three Months Ended March 31,
	2015		2014				2015			2014				2015		2014
(In millions)
Derivatives designated as cash flow hedges:
Interest-rate contracts	$	—	$	(1	)	Net interest revenue	$	(1	)	$	(1	)	Net interest revenue	$	—	$	1
Foreign exchange contracts	20		(12		)	Net interest revenue	—			—			Net interest revenue	2		1
Total	$	20	$	(13	)		$	(1	)	$	(1	)		$	2	$	2