Investment Securities (Tables)

12 Months Ended

Dec. 31, 2017

Investments, Debt and Equity Securities [Abstract]

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



	December 31, 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	$	222	$	2	$	1	$	223	$	4,265	$	7	$	9	$	4,263
Mortgage-backed securities	10,975		26		129		10,872		13,340		76		159		13,257
Total U.S. Treasury and federal agencies	11,197		28		130		11,095		17,605		83		168		17,520
Asset-backed securities:
Student loans⁽¹⁾	3,325		37		4		3,358		5,659		12		75		5,596
Credit cards	1,565		2		25		1,542		1,377		—		26		1,351
Sub-prime	—		—		—		—		289		1		18		272
Other⁽²⁾	1,440		7		—		1,447		895		10		—		905
Total asset-backed securities	6,330		46		29		6,347		8,220		23		119		8,124
Non-U.S. debt securities:
Mortgage-backed securities	6,664		36		5		6,695		6,506		35		6		6,535
Asset-backed securities	2,942		5		—		2,947		2,513		4		1		2,516
Government securities	10,754		16		49		10,721		5,834		8		6		5,836
Other⁽³⁾	6,076		38		6		6,108		5,587		31		5		5,613
Total non-U.S. debt securities	26,436		95		60		26,471		20,440		78		18		20,500
State and political subdivisions	8,929		245		23		9,151		10,233		201		112		10,322
Collateralized mortgage obligations	1,060		3		9		1,054		2,610		18		35		2,593
Other U.S. debt securities	2,563		12		15		2,560		2,481		18		30		2,469
U.S. equity securities	40		8		2		46		39		6		3		42
Non-U.S. equity securities	—		—		—		—		3		—		—		3
U.S. money-market mutual funds	397		—		—		397		409		—		—		409
Non-U.S. money-market mutual funds	—		—		—		—		16		—		—		16
Total	$	56,952	$	437	$	268	$	57,121	$	62,056	$	427	$	485	$	61,998
Held-to-maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	17,028	$	—	$	143	$	16,885	$	17,527	$	17	$	58	$	17,486
Mortgage-backed securities	16,651		22		225		16,448		10,334		20		221		10,133
Total U.S. Treasury and federal agencies	33,679		22		368		33,333		27,861		37		279		27,619
Asset-backed securities:
Student loans⁽¹⁾	3,047		32		9		3,070		2,883		5		30		2,858
Credit cards	798		2		—		800		897		2		—		899
Other	1		—		—		1		35		—		—		35
Total asset-backed securities	3,846		34		9		3,871		3,815		7		30		3,792
Non-U.S. debt securities:
Mortgage-backed securities	939		82		6		1,015		1,150		70		15		1,205
Asset-backed securities	263		1		—		264		531		—		—		531
Government securities	474		2		—		476		286		3		—		289
Other	48		—		—		48		113		1		—		114
Total non-U.S. debt securities	1,724		85		6		1,803		2,080		74		15		2,139
Collateralized mortgage obligations	1,209		45		6		1,248		1,413		42		11		1,444
Total	$	40,458	$	186	$	389	$	40,255	$	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 December 31, 2017 and December 31, 2016, the fair value of other ABS was primarily composed of $1,447 million and $905 million, respectively, of CLOs.

⁽³⁾As of December 31, 2017 and December 31, 2016, the fair value of other non-U.S. debt securities was primarily composed of $3,537 million and $3,769 million, respectively, of covered bonds and $1,885 million and $988 million, as of December 31, 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
December 31, 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	$	—	$	—	$	67	$	1	$	67	$	1
Mortgage-backed securities	5,161		31		3,341		98		8,502		129
Total U.S. Treasury and federal agencies	5,161		31		3,408		99		8,569		130
Asset-backed securities:
Student loans	—		—		769		4		769		4
Credit cards	1,289		25		—		—		1,289		25
Total asset-backed securities	1,289		25		769		4		2,058		29
Non-U.S. debt securities:
Mortgage-backed securities	1,059		4		469		1		1,528		5
Government securities	7,629		48		68		1		7,697		49
Other	816		4		289		2		1,105		6
Total non-U.S. debt securities	9,504		56		826		4		10,330		60
State and political subdivisions	734		6		901		17		1,635		23
Collateralized mortgage obligations	399		5		136		4		535		9
Other U.S. debt securities	1,007		8		345		7		1,352		15
U.S. equity securities	—		—		6		2		6		2
Total	$	18,094	$	131	$	6,391	$	137	$	24,485	$	268
Held-to-maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	14,439	$	109	$	2,447	$	34	$	16,886	$	143
Mortgage-backed securities	6,785		38		5,988		187		12,773		225
Total U.S. Treasury and federal agencies	21,224		147		8,435		221		29,659		368
Asset-backed securities:
Student loans	440		3		423		6		863		9
Total asset-backed securities	440		3		423		6		863		9
Non-U.S. debt securities:
Mortgage-backed securities	—		—		239		6		239		6
Total non-U.S. debt securities	—		—		239		6		239		6
Collateralized mortgage obligations	—		—		276		6		276		6
Total	$	21,664	$	150	$	9,373	$	239	$	31,037	$	389



	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
Total U.S. Treasury and federal agencies	7,723		139		1,294		29		9,017		168
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
Total U.S. Treasury and federal agencies	15,729		278		86		1		15,815		279
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 December 31, 2017. The maturities of certain ABS, MBS, and CMOs 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.



December 31, 2017	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	$	—	$	12	$	6	$	205	$	223
Mortgage-backed securities	96		762		3,123		6,891		10,872
Total U.S. Treasury and federal agencies	96		774		3,129		7,096		11,095
Asset-backed securities:
Student loans	289		1,044		685		1,340		3,358
Credit cards	—		1,290		252		—		1,542
Other	—		350		956		141		1,447
Total asset-backed securities	289		2,684		1,893		1,481		6,347
Non-U.S. debt securities:
Mortgage-backed securities	551		4,502		602		1,040		6,695
Asset-backed securities	205		2,185		557		—		2,947
Government securities	2,195		3,201		4,448		877		10,721
Other	1,078		4,235		758		37		6,108
Total non-U.S. debt securities	4,029		14,123		6,365		1,954		26,471
State and political subdivisions	474		2,415		4,724		1,538		9,151
Collateralized mortgage obligations	3		145		170		736		1,054
Other U.S. debt securities	296		1,097		1,107		60		2,560
Total	$	5,187	$	21,238	$	17,388	$	12,865	$	56,678
Held-to-maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	1,988	$	14,968	$	14	$	58	$	17,028
Mortgage-backed securities	—		162		1,605		14,884		16,651
Total U.S. Treasury and federal agencies	1,988		15,130		1,619		14,942		33,679
Asset-backed securities:
Student loans	35		245		265		2,502		3,047
Credit cards	178		620		—		—		798
Other	—		—		—		1		1
Total asset-backed securities	213		865		265		2,503		3,846
Non-U.S. debt securities:
Mortgage-backed securities	132		217		45		545		939
Asset-backed securities	26		237		—		—		263
Government securities	353		121		—		—		474
Other	—		48		—		—		48
Total non-U.S. debt securities	511		623		45		545		1,724
Collateralized mortgage obligations	8		144		343		714		1,209
Total	$	2,720	$	16,762	$	2,272	$	18,704	$	40,458

Schedule of Credit-Related Loss Activity Recognized in Earnings

The following tables present gross realized gains and losses from sales of AFS investment securities, and the components of net impairment losses included in net gains and losses related to investment securities for the periods indicated.



	Years Ended December 31,
(In millions)	2017			2016			2015
Gross realized gains from sales of AFS investment securities	$	74		$	15		$	57
Gross realized losses from sales of AFS investment securities	(113		)	(5		)	(62		)
Net impairment losses:
Gross losses from OTTI	—			(2		)	(1		)
Losses reclassified (from) to other comprehensive income	—			(1		)	—
Net impairment losses⁽¹⁾	—			(3		)	(1		)
Gains (losses) related to investment securities, net	$	(39	)	$	7		$	(6	)
⁽¹⁾ Net impairment losses, recognized in our consolidated statement of income, were composed of the following:
Impairment associated with expected credit losses	$	—		$	(1	)	$	—
Impairment associated with adverse changes in timing of expected future cash flows	—			(2		)	(1		)
Net impairment losses	$	—		$	(3	)	$	(1	)

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



	Years Ended December 31,
(In millions)	2017			2016			2015
Balance, beginning of period	$	66		$	92		$	115
Additions:
Losses for which OTTI was previously recognized	—			2			1
Deductions:
Previously recognized losses related to securities sold or matured	(2		)	(28		)	(24		)
Balance, end of period	$	64		$	66		$	92

- 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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