Investment Securities (Tables)

6 Months Ended

Jun. 30, 2017

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:



	June 30, 2017								December 31, 2016
	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	$	632	$	3	$	2	$	633	$	4,265	$	7	$	9	$	4,263
Mortgage-backed securities	11,445		61		92		11,414		13,340		76		159		13,257
Asset-backed securities:
Student loans⁽¹⁾	5,871		36		20		5,887		5,659		12		75		5,596
Credit cards	1,575		3		22		1,556		1,377		—		26		1,351
Sub-prime	249		2		8		243		289		1		18		272
Other⁽²⁾	1,154		6		—		1,160		895		10		—		905
Total asset-backed securities	8,849		47		50		8,846		8,220		23		119		8,124
Non-U.S. debt securities:
Mortgage-backed securities	6,925		40		3		6,962		6,506		35		6		6,535
Asset-backed securities	2,884		7		—		2,891		2,513		4		1		2,516
Government securities	6,614		6		20		6,600		5,834		8		6		5,836
Other⁽³⁾	6,247		34		5		6,276		5,587		31		5		5,613
Total non-U.S. debt securities	22,670		87		28		22,729		20,440		78		18		20,500
State and political subdivisions	9,747		328		37		10,038		10,233		201		112		10,322
Collateralized mortgage obligations	2,449		21		27		2,443		2,610		18		35		2,593
Other U.S. debt securities	2,804		17		22		2,799		2,481		18		30		2,469
U.S. equity securities	40		7		2		45		39		6		3		42
Non-U.S. equity securities	1		—		—		1		3		—		—		3
U.S. money-market mutual funds	77		—		—		77		409		—		—		409
Non-U.S. money-market mutual funds	—		—		—		—		16		—		—		16
Total	$	58,714	$	571	$	260	$	59,025	$	62,056	$	427	$	485	$	61,998
Held-to-maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	17,479	$	27	$	35	$	17,471	$	17,527	$	17	$	58	$	17,486
Mortgage-backed securities	11,937		35		200		11,772		10,334		20		221		10,133
Asset-backed securities:
Student loans⁽¹⁾	2,738		17		15		2,740		2,883		5		30		2,858
Credit cards	858		3		—		861		897		2		—		899
Other	5		—		—		5		35		—		—		35
Total asset-backed securities	3,601		20		15		3,606		3,815		7		30		3,792
Non-U.S. debt securities:
Mortgage-backed securities	1,084		80		10		1,154		1,150		70		15		1,205
Asset-backed securities	365		1		—		366		531		—		—		531
Government securities	357		2		—		359		286		3		—		289
Other	122		—		—		122		113		1		—		114
Total non-U.S. debt securities	1,928		83		10		2,001		2,080		74		15		2,139
Collateralized mortgage obligations	1,285		41		7		1,319		1,413		42		11		1,444
Total	$	36,230	$	206	$	267	$	36,169	$	35,169	$	160	$	335	$	34,994

⁽¹⁾ Primarily composed of securities guaranteed by the federal government with respect to at least 97% of defaulted principal and accrued interest on the underlying loans.

⁽²⁾As of June 30, 2017 and December 31, 2016, the fair value of other ABS was primarily composed of $1,160 million and $905 million, respectively, of collateralized loan obligations.

⁽³⁾As of June 30, 2017 and December 31, 2016, the fair value of other non-U.S. debt securities was primarily composed of $3,968 million and $3,769 million, respectively, of covered bonds and $1,264 million and $988 million, as of June 30, 2017 and December 31, 2016, respectively, of corporate bonds.

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
June 30, 2017	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	$	154	$	1	$	164	$	1	$	318	$	2
Mortgage-backed securities	5,877		83		536		9		6,413		92
Asset-backed securities:
Student loans	233		1		2,449		19		2,682		20
Credit cards	—		—		498		22		498		22
Sub-prime	—		—		216		8		216		8
Total asset-backed securities	233		1		3,163		49		3,396		50
Non-U.S. debt securities:
Mortgage-backed securities	342		1		648		2		990		3
Government securities	4,471		20		—		—		4,471		20
Other	728		5		—		—		728		5
Total non-U.S. debt securities	5,541		26		648		2		6,189		28
State and political subdivisions	1,636		33		224		4		1,860		37
Collateralized mortgage obligations	906		23		171		4		1,077		27
Other U.S. debt securities	1,147		18		159		4		1,306		22
U.S. equity securities	—		—		6		2		6		2
Total	$	15,494	$	185	$	5,071	$	75	$	20,565	$	260
Held-to-maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	9,025	$	34	$	79	$	1	$	9,104	$	35
Mortgage-backed securities	6,901		200		—		—		6,901		200
Asset-backed securities:
Student loans	619		8		728		7		1,347		15
Total asset-backed securities	619		8		728		7		1,347		15
Non-U.S. debt securities:
Mortgage-backed securities	—		—		290		10		290		10
Total non-U.S. debt securities	—		—		290		10		290		10
Collateralized mortgage obligations	437		2		182		5		619		7
Total	$	16,982	$	244	$	1,279	$	23	$	18,261	$	267



	Less than 12 months				12 months or longer				Total
December 31, 2016	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
(In millions)
Available-for-sale:
U.S. Treasury and federal agencies:
Direct obligations	$	651	$	8	$	180	$	1	$	831	$	9
Mortgage-backed securities	7,072		131		1,114		28		8,186		159
Asset-backed securities:
Student loans	54		—		3,745		75		3,799		75
Credit cards	795		1		494		25		1,289		26
Sub-prime	1		—		252		18		253		18
Other	75		—		—		—		75		—
Total asset-backed securities	925		1		4,491		118		5,416		119
Non-U.S. debt securities:
Mortgage-backed securities	442		1		893		5		1,335		6
Asset-backed securities	253		—		276		1		529		1
Government securities	1,314		6		—		—		1,314		6
Other	670		4		218		1		888		5
Total non-U.S. debt securities	2,679		11		1,387		7		4,066		18
State and political subdivisions	3,390		102		304		10		3,694		112
Collateralized mortgage obligations	1,259		31		162		4		1,421		35
Other U.S. debt securities	944		24		157		6		1,101		30
U.S. equity securities	8		—		5		3		13		3
Total	$	16,928	$	308	$	7,800	$	177	$	24,728	$	485
Held-to-maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	8,891	$	57	$	86	$	1	$	8,977	$	58
Mortgage-backed securities	6,838		221		—		—		6,838		221
Asset-backed securities:
Student loans	705		9		1,235		21		1,940		30
Credit cards	33		—		—		—		33		—
Other	18		—		9		—		27		—
Total asset-backed securities	756		9		1,244		21		2,000		30
Non-U.S. debt securities:
Mortgage-backed securities	54		2		330		13		384		15
Asset-backed securities	28		—		35		—		63		—
Government securities	180		—		—		—		180		—
Total non-U.S. debt securities	262		2		365		13		627		15
Collateralized mortgage obligations	537		4		204		7		741		11
Total	$	17,284	$	293	$	1,899	$	42	$	19,183	$	335

Investments Classified by Contractual Maturity Date

The following table presents contractual maturities of debt investment securities by carrying amount as of June 30, 2017. The maturities of certain asset-backed securities, mortgage-backed securities, and collateralized mortgage obligations are based on expected principal payments. Actual maturities may differ from these expected maturities since certain borrowers have the right to prepay obligations with or without prepayment penalties.



	Under 1 Year		1 to 5 Years		6 to 10 Years		Over 10 Years		Total
(In millions)	Under 1 Year		1 to 5 Years		6 to 10 Years		Over 10 Years		Total
Available-for-sale:
U.S. Treasury and federal agencies:
Direct obligations	$	231	$	8	$	52	$	342	$	633
Mortgage-backed securities	254		1,463		3,241		6,456		11,414
Asset-backed securities:
Student loans	915		2,415		894		1,663		5,887
Credit cards	—		1,006		550		—		1,556
Sub-prime	—		2		2		239		243
Other	—		122		1,038		—		1,160
Total asset-backed securities	915		3,545		2,484		1,902		8,846
Non-U.S. debt securities:
Mortgage-backed securities	1,152		3,909		964		937		6,962
Asset-backed securities	370		2,261		260		—		2,891
Government securities	3,144		2,255		1,201		—		6,600
Other	2,030		3,535		711		—		6,276
Total non-U.S. debt securities	6,696		11,960		3,136		937		22,729
State and political subdivisions	398		2,493		5,181		1,966		10,038
Collateralized mortgage obligations	—		158		771		1,514		2,443
Other U.S. debt securities	507		924		1,368		—		2,799
Total	$	9,001	$	20,551	$	16,233	$	13,117	$	58,902
Held-to-maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	1,199	$	15,800	$	414	$	66	$	17,479
Mortgage-backed securities	—		182		1,386		10,369		11,937
Asset-backed securities:
Student loans	307		246		291		1,894		2,738
Credit cards	124		734		—		—		858
Other	—		4		—		1		5
Total asset-backed securities	431		984		291		1,895		3,601
Non-U.S. debt securities:
Mortgage-backed securities	223		242		51		568		1,084
Asset-backed securities	127		238		—		—		365
Government securities	242		115		—		—		357
Other	76		46		—		—		122
Total non-U.S. debt securities	668		641		51		568		1,928
Collateralized mortgage obligations	7		15		483		780		1,285
Total	$	2,305	$	17,622	$	2,625	$	13,678	$	36,230

Schedule of Credit-Related Loss Activity Recognized in Earnings

The following table presents a roll-forward with respect to net impairment losses that have been recognized in income for the periods indicated.



	Six Months Ended June 30,
(In millions)	2017			2016
Balance, beginning of period	$	66		$	92
Additions:
Losses for which OTTI was not previously recognized	—			1
Deductions:
Previously recognized losses related to securities sold or matured	(2		)	(2		)
Balance, end of period	$	64		$	91

- 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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