Investment Securities (Tables)

12 Months Ended

Dec. 31, 2018

Investments, Debt and Equity Securities [Abstract]

Schedule of Marketable Securities

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

	December 31, 2018								December 31, 2017
	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	$	1,035	$	4	$	—	$	1,039	$	222	$	2	$	1	$	223
Mortgage-backed securities	16,112		37		181		15,968		10,975		26		129		10,872
Total U.S. Treasury and federal agencies	17,147		41		181		17,007		11,197		28		130		11,095
Asset-backed securities:
Student loans(1)	538		4		1		541		3,325		37		4		3,358
Credit cards	609		—		26		583		1,565		2		25		1,542
Collateralized loan obligations	594		1		2		593		1,440		7		—		1,447
Total asset-backed securities	1,741		5		29		1,717		6,330		46		29		6,347
Non-U.S. debt securities:
Mortgage-backed securities	1,687		—		5		1,682		6,664		36		5		6,695
Asset-backed securities	1,580		—		6		1,574		2,942		5		—		2,947
Government securities	12,816		22		45		12,793		10,754		16		49		10,721
Other(2)	6,600		18		16		6,602		6,076		38		6		6,108
Total non-U.S. debt securities	22,683		40		72		22,651		26,436		95		60		26,471
State and political subdivisions(3)	1,905		20		7		1,918		8,929		245		23		9,151
Collateralized mortgage obligations	200		—		3		197		1,060		3		9		1,054
Other U.S. debt securities	1,683		1		26		1,658		2,563		12		15		2,560
U.S. equity securities(4)	—		—		—		—		40		8		2		46
U.S. money-market mutual funds(4)	—		—		—		—		397		—		—		397
Total	$	45,359	$	107	$	318	$	45,148	$	56,952	$	437	$	268	$	57,121
Held-to-maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	14,794	$	—	$	199	$	14,595	$	17,028	$	—	$	143	$	16,885
Mortgage-backed securities	21,647		24		518		21,153		16,651		22		225		16,448
Total U.S. Treasury and federal agencies	36,441		24		717		35,748		33,679		22		368		33,333
Asset-backed securities:
Student loans(1)	3,191		35		10		3,216		3,047		32		9		3,070
Credit cards	193		—		—		193		798		2		—		800
Other	1		—		—		1		1		—		—		1
Total asset-backed securities	3,385		35		10		3,410		3,846		34		9		3,871
Non-U.S. debt securities:
Mortgage-backed securities	638		77		9		706		939		82		6		1,015
Asset-backed securities	223		—		—		223		263		1		—		264
Government securities	358		1		—		359		474		2		—		476
Other	46		—		—		46		48		—		—		48
Total non-U.S. debt securities	1,265		78		9		1,334		1,724		85		6		1,803
Collateralized mortgage obligations	823		38		2		859		1,209		45		6		1,248
Total	$	41,914	$	175	$	738	$	41,351	$	40,458	$	186	$	389	$	40,255

⁽¹⁾ Primarily comprised 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, 2018 and December 31, 2017, the fair value of other non-U.S. debt securities included $1,295 million and $3,537 million, respectively, of covered bonds and $1,331 million and $1,885 million, respectively, of corporate bonds.

⁽³⁾ As of December 31, 2018 and December 31, 2017, the fair value of state and political subdivisions includes securities in trusts of $1,052 million and $1,247 million, respectively. Additional information about these trusts is provided in Note 14.

⁽⁴⁾ As described in Note 1 to the consolidated financial statements in this Form 10-K, upon adoption of ASU 2016-01 in 2018, we reclassified money-market funds and equity securities classified as AFS to held at fair value through profit and loss in other assets.

Schedule of Gross Pre-tax Unrealized Losses on Investment Securities

The following tables present the aggregate fair values of AFS and HTM 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, 2018	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:
Mortgage-backed securities	$	5,058	$	21	$	5,089	$	160	$	10,147	$	181
Total U.S. Treasury and federal agencies	5,058		21		5,089		160		10,147		181
Asset-backed securities:
Student loans	106		—		218		1		324		1
Credit cards	90		—		493		26		583		26
Collateralized loan obligations	548		2		—		—		548		2
Total asset-backed securities	744		2		711		27		1,455		29
Non-U.S. debt securities:
Mortgage-backed securities	1,407		4		118		1		1,525		5
Asset-backed securities	1,479		6		—		—		1,479		6
Government securities	5,478		45		—		—		5,478		45
Other	2,167		12		226		4		2,393		16
Total non-U.S. debt securities	10,531		67		344		5		10,875		72
State and political subdivisions	365		3		244		4		609		7
Collateralized mortgage obligations	181		3		14		—		195		3
Other U.S. debt securities	861		14		484		12		1,345		26
Total	$	17,740	$	110	$	6,886	$	208	$	24,626	$	318
Held-to-maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	2,192	$	45	$	12,403	$	154	$	14,595	$	199
Mortgage-backed securities	6,502		103		10,648		415		17,150		518
Total U.S. Treasury and federal agencies	8,694		148		23,051		569		31,745		717
Asset-backed securities:
Student loans	481		4		536		6		1,017		10
Total asset-backed securities	481		4		536		6		1,017		10
Non-U.S. debt securities:
Mortgage-backed securities	184		2		119		7		303		9
Total non-U.S. debt securities	184		2		119		7		303		9
Collateralized mortgage obligations	102		1		51		1		153		2
Total	$	9,461	$	155	$	23,757	$	583	$	33,218	$	738

	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)
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

Investments Classified by Contractual Maturity Date

The following table presents contractual maturities of debt investment securities by carrying amount as of December 31, 2018. 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, 2018	Under 1 Year		1 to 5 Years		6 to 10 Years		Over 10 Years		Total
(In millions)
Available-for-sale:
U.S. Treasury and federal agencies:
Direct obligations	$	224	$	815	$	—	$	—	$	1,039
Mortgage-backed securities	101		802		1,884		13,181		15,968
Total U.S. Treasury and federal agencies	325		1,617		1,884		13,181		17,007
Asset-backed securities:
Student loans	57		164		250		70		541
Credit cards	199		294		90		—		583
Collateralized loan obligations	—		402		171		20		593
Total asset-backed securities	256		860		511		90		1,717
Non-U.S. debt securities:
Mortgage-backed securities	139		769		176		598		1,682
Asset-backed securities	136		698		581		159		1,574
Government securities	3,439		6,409		2,945		—		12,793
Other	1,071		4,575		937		19		6,602
Total non-U.S. debt securities	4,785		12,451		4,639		776		22,651
State and political subdivisions	235		776		446		461		1,918
Collateralized mortgage obligations	2		—		—		195		197
Other U.S. debt securities	141		1,219		298		—		1,658
Total	$	5,744	$	16,923	$	7,778	$	14,703	$	45,148
Held-to-maturity:
U.S. Treasury and federal agencies:
Direct obligations	$	4,002	$	10,737	$	12	$	43	$	14,794
Mortgage-backed securities	33		127		1,697		19,790		21,647
Total U.S. Treasury and federal agencies	4,035		10,864		1,709		19,833		36,441
Asset-backed securities:
Student loans	7		291		267		2,626		3,191
Credit cards	58		135		—		—		193
Other	—		—		—		1		1
Total asset-backed securities	65		426		267		2,627		3,385
Non-U.S. debt securities:
Mortgage-backed securities	160		42		7		429		638
Asset-backed securities	96		127		—		—		223
Government securities	243		115		—		—		358
Other	46		—		—		—		46
Total non-U.S. debt securities	545		284		7		429		1,265
Collateralized mortgage obligations	1		318		15		489		823
Total	$	4,646	$	11,892	$	1,998	$	23,378	$	41,914

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)	2018			2017			2016
Gross realized gains from sales of AFS investment securities	$	205		$	74		$	15
Gross realized losses from sales of AFS investment securities	(196		)	(113		)	(5		)
Net impairment losses:
Gross losses from OTTI	(3		)	—			(2		)
Losses reclassified (from) to other comprehensive income	—			—			(1		)
Net impairment losses(1)	(3		)	—			(3		)
Gains (losses) related to investment securities, net	$	6		$	(39	)	$	7
(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	(3		)	—			(2		)
Net impairment losses	$	(3	)	$	—		$	(3	)

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)	2018			2017			2016
Balance, beginning of period	$	77		$	79		$	105
Additions(1):
OTTI recognized	3			—			2
Deductions(2):
Realized losses on securities sold or matured	(2		)	(2		)	(28		)
Balance, end of period	$	78		$	77		$	79

⁽¹⁾ Additions represent securities with a first time credit impairment realized or when a subsequent credit impairment has occurred.

⁽²⁾ Deductions represent impairments on securities that have been sold or matured, are required to be sold, or for which management intends to sell.