Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Schedule of effective tax rate

The following table is an analysis of the effective tax rate:

	Years Ended December 31,
(Dollars in millions)	2018		2017		2016
Federal income tax rate	21	%	35	%	35	%
Net tax effects of:
State income taxes, net of federal income tax benefit	7		5		6
Tax-exempt interest income	(1	)	(1	)	(1	)
Losses from LIHC investments	(2	)	(3	)	(3	)
Amortization of LIHC investments	12		14		10
Tax credits	(25	)	(21	)	(18	)
Effects of US tax law change	(2	)	(8	)	—
State Tax Refunds	(5	)	—		—
Other	—		1		2
Effective tax rate	5	%	22	%	31	%

Components of Income Tax Expense

The components of income tax expense were as follows:

	Years Ended December 31,
(Dollars in millions)	2018			2017			2016
Current income tax expense:
Federal	$	195		$	257		$	228
State	89			21			105
Foreign	10			(4		)	7
Total current expense	294			274			340
Deferred income tax expense (benefit):
Federal	(173		)	(49		)	58
State	(64		)	52			24
Foreign	(5		)	22			(3		)
Total deferred expense	(242		)	25			79
Total income tax expense	$	52		$	299		$	419

Schedule of components of the Company's net deferred tax balances

The components of the Company's net deferred tax balances as of December 31, 2018 and 2017 were as follows:

	December 31,
(Dollars in millions)	2018		2017
Deferred tax assets:
Tax credits and net operating loss carryforwards	$	448	$	310
Allowance for credit losses	251		254
Accrued expense, net	159		178
Unrealized losses on pension and postretirement benefits	260		214
Unrealized net losses on securities available for sale	132		82
Fair value adjustments for valuation of FDIC covered assets	53		61
Unrealized gains/losses on cash flow hedges	78		62
Other	—		—
Total deferred tax assets	1,381		1,161
Deferred tax liabilities:
Leasing and renewable energy	619		769
Intangible assets	59		55
Pension liabilities	365		358
Other	10		7
Total deferred tax liabilities	1,053		1,189
Net deferred tax asset (liability)	$	328	$	(28	)

Schedule of changes in unrecognized tax positions

The following table reflects the changes in gross unrecognized tax benefits:

	Years Ended December 31,
(Dollars in millions)	2018			2017			2016
Balance, beginning of year	$	56		$	11		$	8
Gross increases as a result of tax positions taken during prior periods	72			45			—
Gross decreases as a result of tax positions taken during prior periods	—			—			—
Gross increases as a result of tax positions taken during current period	—			2			3
Gross decrease as a result of closed audit years or settlements	(1		)	(2		)	—
Balance, end of year	$	127		$	56		$	11