Variable Interest Entities

In the normal course of business, the Company has certain financial interests in entities which have been determined to be VIEs. Generally, a VIE is a corporation, partnership, trust or other legal structure where the equity investors do not have substantive voting rights, an obligation to absorb the entity’s losses or the right to receive the entity’s returns, or the ability to direct the significant activities of the entity. The following discusses the Company’s consolidated and unconsolidated VIEs.

Consolidated VIEs

The following tables present the assets and liabilities of consolidated VIEs recorded on the Company’s consolidated balance sheets at March 31, 2017 and December 31, 2016:



	March 31, 2017
	Consolidated Assets						Consolidated Liabilities
(Dollars in millions)	Loans Held for Investment, net		Other Assets		Total Assets		Other Liabilities		Total Liabilities
LIHC investments	$	—	$	106	$	106	$	—	$	—
Leasing investments	622		173		795		54		54
Total consolidated VIEs	$	622	$	279	$	901	$	54	$	54



	December 31, 2016
	Consolidated Assets						Consolidated Liabilities
(Dollars in millions)	Loans Held for Investment, net		Other Assets		Total Assets		Other Liabilities		Total Liabilities
LIHC investments	$	—	$	112	$	112	$	—	$	—
Leasing investments	641		174		815		54		54
Total consolidated VIEs	$	641	$	286	$	927	$	54	$	54

LIHC Investments

The Company sponsors, manages and syndicates two LIHC investment fund structures. These investments are designed to generate a return primarily through the realization of U.S. federal tax credits and deductions. The Company is considered the primary beneficiary and has consolidated these investments because the Company has the power to direct activities that most significantly impact the funds’ economic performances and also has the obligation to absorb losses of the funds that could potentially be significant to the funds. Neither creditors nor equity investors in the LIHC investments have any recourse to the general credit of the Company, and the Company’s creditors do not have any recourse to the assets of the consolidated LIHC investments.

Leasing Investments

The Company has leasing investments primarily in the wind energy, rail and coal industries. The Company is considered the primary beneficiary and has consolidated these investments because the Company has the power to direct the activities of these entities that significantly impact the entities’ economic performances. The Company also has the right to receive potentially significant benefits or the obligation to absorb potentially significant losses of these investments.

Unconsolidated VIEs

The following tables present the Company’s carrying amounts related to the unconsolidated VIEs at March 31, 2017 and December 31, 2016. The tables also present the Company’s maximum exposure to loss resulting from its involvement with these VIEs. The maximum exposure to loss represents the carrying amount of the Company’s involvement plus any legally binding unfunded commitments in the unlikely event that all of the assets in the VIEs become worthless. During the three months ended March 31, 2017 and March 31, 2016, the Company had noncash increases in unfunded commitments on LIHC investments of $19 million and $37 million, respectively, included within other liabilities.



	March 31, 2017
	Unconsolidated Assets										Unconsolidated Liabilities
(Dollars in millions)	Interest Bearing Deposits in Banks		Securities Available for Sale		Loans Held for Investment		Other Assets		Total Assets		Other Liabilities		Total Liabilities		Maximum Exposure to Loss
LIHC investments	$	—	$	25	$	199	$	1,148	$	1,372	$	388	$	388	$	1,372
Leasing investments	1		12		28		1,662		1,703		66		66		1,723
Other investments	—		—		24		25		49		—		—		76
Total unconsolidated VIEs	$	1	$	37	$	251	$	2,835	$	3,124	$	454	$	454	$	3,171



			December 31, 2016
			Unconsolidated Assets								Unconsolidated Liabilities
(Dollars in millions)	Interest Bearing Deposits in Banks		Securities Available for Sale		Loans Held for Investment		Other Assets		Total Assets		Other Liabilities		Total Liabilities		Maximum Exposure to Loss
LIHC investments	$	—	$	25	$	168	$	1,164	$	1,357	$	381	$	381	$	1,357
Leasing investments	1		12		47		1,751		1,811		66		66		1,833
Other investments	—		—		24		26		50		—		—		81
Total unconsolidated VIEs	$	1	$	37	$	239	$	2,941	$	3,218	$	447	$	447	$	3,271

LIHC Investments

The Company makes investments in partnerships and funds formed by third parties. The primary purpose of the partnerships and funds is to invest in low-income housing units and distribute tax credits and tax benefits associated with the underlying properties to investors. The Company is a limited partner investor and is allocated tax credits and deductions, but has no voting or other rights to direct the activities of the funds or partnerships, and therefore is not considered the primary beneficiary and does not consolidate these investments.

The following table presents the impact of the unconsolidated LIHC investments on our consolidated statements of income for the three months ended March 31, 2017 and 2016:



	For the Three Months Ended
	March 31, 2017		March 31, 2016
(Dollars in millions)	March 31, 2017		March 31, 2016
Losses from LIHC investments included in other noninterest expense	$	2	$	2
Amortization of LIHC investments included in income tax expense	33		30
Tax credits and other tax benefits from LIHC investments included in income tax expense	45		45

Leasing Investments

The unconsolidated VIEs related to leasing investments are primarily renewable energy investments. Through its subsidiaries, the Company makes equity investments in LLCs established by third party sponsors. The LLCs are created to operate and manage wind, solar, hydroelectric and cogeneration power plant projects. Power generated by the projects is sold to third parties through long-term purchase power agreements. As a limited investor member, the Company is allocated production tax credits and taxable income or losses associated with the projects. The Company has no voting or other rights to direct the significant activities of the LLCs, and therefore is not considered the primary beneficiary and does not consolidate these investments.

Other Investments

The Company has other investments in structures formed by third parties. The Company has no voting or other rights to direct the activities of the investments that would most significantly impact the entities’ performance, and therefore is not considered the primary beneficiary and does not consolidate these investments.