Shareowners' Equity and Noncontrolling Interest

A summary of the changes in shareowners' equity and noncontrolling interest comprising total equity for the quarters and nine months ended September 30, 2015 and 2014 is provided below:



	Quarter Ended September 30,
	2015									2014
(Dollars in millions)	Share-owners' Equity			Non-controlling Interest			Total Equity			Share-owners' Equity			Non-controlling Interest			Total Equity
Equity, beginning of period	$	30,377		$	1,561		$	31,938		$	33,785		$	1,408		$	35,193
Comprehensive income for the period:
Net income	1,362			99			1,461			1,854			98			1,952
Total other comprehensive loss	(811		)	(23		)	(834		)	(766		)	(27		)	(793		)
Total comprehensive income for the period	551			76			627			1,088			71			1,159
Common Stock issued - equity unit remarketing	1,100			—			1,100			—			—			—
Common Stock issued under employee plans	65			—			65			154			—			154
Common Stock repurchased	(1,000		)	—			(1,000		)	(425		)	—			(425		)
Dividends on Common Stock	(547		)	—			(547		)	(512		)	—			(512		)
Dividends on ESOP Common Stock	(19		)	—			(19		)	(17		)	—			(17		)
Dividends attributable to noncontrolling interest	—			(113		)	(113		)	—			(145		)	(145		)
Sale (purchase) of subsidiary shares from noncontrolling interest	1			—			1			(24		)	6			(18		)
Redeemable noncontrolling interest	—			1			1			—			—			—
Other	(3		)	1			(2		)	—			—			—
Equity, end of period	$	30,525		$	1,526		$	32,051		$	34,049		$	1,340		$	35,389



	Nine Months Ended September 30,
	2015									2014
(Dollars in millions)	Share-owners' Equity			Non-controlling Interest			Total Equity			Share-owners' Equity			Non-controlling Interest			Total Equity
Equity, beginning of period	$	31,213		$	1,351		$	32,564		$	31,866		$	1,353		$	33,219
Comprehensive income for the period:
Net income	4,330			281			4,611			4,747			301			5,048
Total other comprehensive loss	(727		)	(63		)	(790		)	(289		)	(34		)	(323		)
Total comprehensive income for the period	3,603			218			3,821			4,458			267			4,725
Common Stock issued - equity unit remarketing	1,100			—			1,100			—			—			—
Common Stock issued under employee plans	302			—			302			444			—			444
Common Stock repurchased	(4,000		)	—			(4,000		)	(1,095		)	—			(1,095		)
Dividends on Common Stock	(1,643		)	—			(1,643		)	(1,538		)	—			(1,538		)
Dividends on ESOP Common Stock	(56		)	—			(56		)	(53		)	—			(53		)
Dividends attributable to noncontrolling interest	—			(229		)	(229		)	—			(245		)	(245		)
Sale (purchase) of subsidiary shares from noncontrolling interest	12			10			22			(33		)	—			(33		)
Acquisition of noncontrolling interest	—			173			173			—			—			—
Disposition of noncontrolling interest	—			(3		)	(3		)	—			3			3
Redeemable noncontrolling interest	(3		)	6			3			—			(38		)	(38		)
Other	(3		)	—			(3		)	—			—			—
Equity, end of period	$	30,525		$	1,526		$	32,051		$	34,049		$	1,340		$	35,389

On March 13, 2015, we entered into accelerated share repurchase (ASR) agreements with each of Goldman, Sachs & Co. and Morgan Stanley & Co. LLC to repurchase shares of our common stock for an aggregate purchase price of $2.65 billion. Each ASR agreement provided for the repurchase of our common stock based on the average of the daily volume-weighted average prices of our common stock during the term of such ASR agreement, less a discount and subject to adjustments pursuant to the terms and conditions of the ASR agreement.

On March 13, 2015, we paid the aggregate purchase price and received an initial delivery of 18.6 million shares of common stock at a price of $121.24 per share, representing approximately 85% of the shares expected to be repurchased. The aggregate purchase price was recorded as a reduction to Shareowners’ Equity, consisting of a $2.25 billion increase in Treasury Stock and a $398 million decrease in additional paid-in capital. On July 31, 2015, the shares associated with the remaining portion of the aggregate purchase were settled upon final delivery of approximately 4.2 million additional shares of common stock. Including the remaining shares settled on July 31, 2015, the final price under the ASR was $116.11 per share. The $398 million initially recorded in additional paid-in capital was reclassified to Treasury Stock.

As discussed in Note 5, on August 3, 2015, we received approximately $1.1 billion from the proceeds of the remarketing of our 1.550% junior subordinated notes, which were originally issued as part of our equity units on June 18, 2012, and issued approximately 11.3 million shares of common stock to settle the purchase obligation of the holders of the equity units under the purchase contract entered into at the time of the original issuance of the equity units.

A summary of the changes in each component of accumulated other comprehensive income (loss), net of tax for the quarters and nine months ended September 30, 2015 and 2014 is provided below:



(Dollars in millions)	Foreign Currency Translation			Defined Benefit Pension and Post- retirement Plans			Unrealized Gains (Losses) on Available-for-Sale Securities			Unrealized Hedging (Losses) Gains			Accumulated Other Comprehensive (Loss) Income
Quarter Ended September 30, 2015
Balance at June 30, 2015	$	(1,278	)	$	(5,405	)	$	330		$	(224	)	$	(6,577	)
Other comprehensive income (loss) before reclassifications, net	(913		)	73			(48		)	(111		)	(999		)
Amounts reclassified, pretax	—			216			(2		)	64			278
Tax (benefit) expense reclassified	—			(81		)	7			(16		)	(90		)
Balance at September 30, 2015	$	(2,191	)	$	(5,197	)	$	287		$	(287	)	$	(7,388	)

Nine Months Ended September 30, 2015
Balance at December 31, 2014	$	(1,051	)	$	(5,709	)	$	308		$	(209	)	$	(6,661	)
Other comprehensive (loss) income before reclassifications, net	(1,139		)	104			10			(194		)	(1,219		)
Amounts reclassified, pretax	(1		)	651			(56		)	164			758
Tax (benefit) expense reclassified	—			(243		)	25			(48		)	(266		)
Balance at September 30, 2015	$	(2,191	)	$	(5,197	)	$	287		$	(287	)	$	(7,388	)



(Dollars in millions)	Foreign Currency Translation			Defined Benefit Pension and Post- retirement Plans			Unrealized Gains (Losses) on Available-for-Sale Securities			Unrealized Hedging (Losses) Gains			Accumulated Other Comprehensive (Loss) Income
Quarter Ended September 30, 2014
Balance at June 30, 2014	$	495		$	(3,127	)	$	272		$	(43	)	$	(2,403	)
Other comprehensive income (loss) before reclassifications, net	(717		)	9			(37		)	(113		)	(858		)
Amounts reclassified, pretax	1			104			—			24			129
Tax benefit reclassified	—			(37		)	—			—			(37		)
Balance at September 30, 2014	$	(221	)	$	(3,051	)	$	235		$	(132	)	$	(3,169	)

Nine Months Ended September 30, 2014
Balance at December 31, 2013	$	170		$	(3,267	)	$	296		$	(79	)	$	(2,880	)
Other comprehensive income (loss) before reclassifications, net	(395		)	10			(43		)	(98		)	(526		)
Amounts reclassified, pretax	4			312			(30		)	55			341
Tax (benefit) expense reclassified	—			(106		)	12			(10		)	(104		)
Balance at September 30, 2014	$	(221	)	$	(3,051	)	$	235		$	(132	)	$	(3,169	)

Amounts reclassified related to our defined benefit pension and postretirement plans include amortization of prior service costs and transition obligations, and actuarial net losses recognized during each period presented. These costs are recorded as components of net periodic pension cost for each period presented (see Note 7 for additional details).

All noncontrolling interests with redemption features, such as put options, that are not solely within our control (redeemable noncontrolling interests) are reported in the mezzanine section of the Condensed Consolidated Balance Sheet, between liabilities and equity, at the greater of redemption value or initial carrying value. A summary of the changes in redeemable noncontrolling interest recorded in the mezzanine section of the Condensed Consolidated Balance Sheet for the quarters and nine months ended September 30, 2015 and 2014 is provided below:



	Quarter Ended September 30,						Nine Months Ended September 30,
(Dollars in millions)	2015			2014			2015			2014
Redeemable noncontrolling interest, beginning of period	$	134		$	146		$	140		$	111
Net income	3			—			7			7
Foreign currency translation	(4		)	(5		)	(13		)	(5		)
Dividends attributable to noncontrolling interest	—			—			(3		)	(3		)
Purchase of subsidiary shares from noncontrolling interest	(1		)	—			(2		)	—
Redeemable noncontrolling interest fair value adjustment	—			—			3			—
Redeemable noncontrolling interest reclassification to noncontrolling interest	—			—			—			31
Redeemable noncontrolling interest, end of period	$	132		$	141		$	132		$	141

Changes in noncontrolling interests that do not result in a change of control and where there is a difference between fair value and carrying value are accounted for as equity transactions. A summary of these changes in ownership interests in subsidiaries and the pro-forma effect on Net income attributable to common shareowners had they been recorded through net income for the quarters and nine months ended September 30, 2015 and 2014 is provided below:



	Quarter Ended September 30,					Nine Months Ended September 30,
(Dollars in millions)	2015		2014			2015			2014
Net income attributable to common shareowners	$	1,362	$	1,854		$	4,330		$	4,747
Transfers to noncontrolling interests:
Increase in common stock for sale of subsidiary shares	1		—			24			4
Decrease in common stock for purchase of subsidiary shares	—		(24		)	(12		)	(37		)
Net income attributable to common shareowners after transfers to noncontrolling interests	$	1,363	$	1,830		$	4,342		$	4,714