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Fair Value Measurements (Tables)
 6 Months Ended
Jun. 30, 2015
Fair Value Disclosures [Abstract]  
Assets and liabilities at fair value
ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON A RECURRING BASIS
Netting
(In millions)Level 1(a)Level 2(a)Level 3adjustment(b)Net balance
June 30, 2015
Assets
Investment securities
   Debt
      U.S. corporate$-$19,817$3,024$-$22,841
      State and municipal-4,222101-4,323
      Residential mortgage-backed-1,1562-1,158
      Commercial mortgage-backed-2,4592-2,461
      Asset-backed-2276-98
      Corporate – non-U.S.12619283-914
      Government – non-U.S.281,8082-1,838
      U.S. government and federal agency-5,291293-5,584
   Retained interests
   Equity
      Available-for-sale177196-202
      Trading19---19
Derivatives(c)-7,15672(5,761)1,467
Other (d)--222-222
Total $236$42,569$4,083$(5,761)$41,127
Liabilities
Derivatives$-$5,419$11$(4,807)$623
Other(e)-1,145--1,145
Total $-$6,564$11$(4,807)$1,768
December 31, 2014
Assets
Investment securities
   Debt
      U.S. corporate$-$20,659$3,056$-$23,715
      State and municipal-4,560115-4,675
      Residential mortgage-backed-1,67616-1,692
      Commercial mortgage-backed-3,0549-3,063
      Asset-backed-172123-295
      Corporate – non-U.S.-680337-1,017
      Government – non-U.S.-1,7082-1,710
      U.S. government and federal agency-1,747266-2,013
   Equity-
      Available-for-sale171199-199
      Trading21---21
Derivatives(c)-9,95740(7,584)2,413
Other (d)--277-277
Total $192$44,232$4,250$(7,584)$41,090
Liabilities
Derivatives$-$4,890$13$(4,363)$540
Other(e)-1,178--1,178
Total $-$6,068$13$(4,363)$1,718

(a) There were no securities transferred between Level 1 and Level 2 in the six months ended June 30, 2015. There were $487 million of Government – non-U.S. and $13 million of Corporate – non-U.S. available-for-sale debt securities transferred from Level 1 to Level 2 in the twelve months ended December 31, 2014 primarily attributable to changes in market observable data.

(b) The netting of derivative receivables and payables (including the effects of any collateral posted or received) is permitted when a legally enforceable master netting agreement exists.

(c) The fair value of derivatives includes an adjustment for non-performance risk. The cumulative adjustment was a gain (loss) of $14 million and $16 million at June 30, 2015 and December 31, 2014, respectively. See Note 15 for additional information on the composition of our derivative portfolio.

(d) Includes private equity investments.

(e) Primarily represented the liability associated with certain of our deferred incentive compensation plans
Changes in level 3 instruments
CHANGES IN LEVEL 3 INSTRUMENTS FOR THE THREE MONTHS ENDED
Net
change in
NetNetunrealized
realized/ realized/gains
unrealizedunrealized(losses)
gainsgainsrelating to
(losses)(losses)TransfersTransfersinstruments
Balance atincludedincludedintoout ofBalance atstill held at
(In millions)April 1in earnings(a)in AOCIPurchasesSalesSettlementsLevel 3(b)Level 3(b)June 30June 30(c)
2015
Investment securities   
  Debt
    U.S. corporate$3,163$(10)$(145)$87$(38)$(20)$-$(13)$3,024$-
    State and municipal114-(5)--(8)--101-
    RMBS2-------2-
    CMBS2-------2-
    ABS111(14)(8)----(13)76-
    Corporate – non-U.S.290-(7)-----283-
    Government – non-U.S.2-------2-
    U.S. government and
       federal agency291-2-----293-
  Equity
    Available-for-sale5--6(5)---6-
Derivatives(d)(e)40(4)---(6)42-72(7)
Other 2254--(7)---2221
Total $4,245$(24)$(163)$93$(50)$(34)$42$(26)$4,083$(6)
2014
Investment securities   
  Debt
    U.S. corporate$3,011$12$56$187$(157)$(27)$41$(63)$3,060$-
    State and municipal105-41----110-
RMBS8111-(16)(1)--66-
CMBS12-------12-
ABS14212--(5)-(10)130-
Corporate – non-U.S.5221236-(54)-1(6)511-
Government – non-U.S.1-------1-
    U.S. government and
       federal agency232-17-----249-
  Retained interests1-------1-
  Equity
    Available-for-sale11--2(2)(2)--9-
Derivatives(d)(e)264-(3)-3-(1)293
Other 18910-20(2)---21714
Total $4,333$40$116$207$(231)$(32)$42$(80)$4,395$17

  • Earnings effects are primarily included in the “GECC revenues from services” and “Interest and other financial charges” captions in the Statement of Earnings (Loss).
  • Transfers in and out of Level 3 are considered to occur at the beginning of the period. Transfers out of Level 3 were primarily a result of increased use of quotes from independent pricing vendors based on recent trading activity.
  • Represents the amount of unrealized gains or losses for the period included in earnings.
  • Represents derivative assets net of derivative liabilities and included cash accruals of $11 million and $8 million not reflected in the fair value hierarchy table for the three months ended June 30, 2015 and 2014, respectively.
  • Gains (losses) included in net realized/unrealized gains (losses) included in earnings were offset by the earnings effects from the underlying items that were economically hedged. See Note 15.

CHANGES IN LEVEL 3 INSTRUMENTS FOR THE SIX MONTHS ENDED
Net
change in
NetNetunrealized
realized/ realized/gains
unrealizedunrealized(losses)
gainsgainsrelating to
(losses)(losses)TransfersTransfersinstruments
Balance atincludedincludedintoout ofBalance atstill held at
(In millions)January 1in earnings(a)in AOCIPurchasesSalesSettlementsLevel 3(b)Level 3(b)June 30June 30(c)
2015
Investment securities   
  Debt
    U.S. corporate$3,056$(3)$(86)$181$(55)$(56)$-$(13)$3,024$-
    State and municipal115-(4)--(10)--101-
    RMBS165(4)-(15)---2-
    CMBS9---(7)---2-
    ABS123(14)(5)-(12)(3)-(13)76-
    Corporate – non-U.S.337-(4)-(50)---283-
    Government – non-U.S.2-------2-
    U.S. government and
       federal agency266-28--(1)--293-
  Equity
    Available-for-sale92(2)6(5)(4)--6-
Derivatives(d)(e)36(1)21-(8)42-72(3)
Other 277(34)--(21)---222(37)
Total $4,246$(45)$(75)$188$(165)$(82)$42$(26)$4,083$(40)
2014
Investment securities   
  Debt
    U.S. corporate$2,787$18$119$339$(156)$(68)$138$(117)$3,060$-
    State and municipal96-710-(3)--110-
RMBS861--(16)(5)--66-
CMBS10-----2-12-
ABS14524--(11)-(10)130-
Corporate – non-U.S.5151343-(54)(1)1(6)511-
Government – non-U.S.31------(30)1-
    U.S. government and
       federal agency225-26----(2)249-
  Retained interests1-------1-
  Equity
    Available-for-sale11--2(2)(2)--9-
Derivatives(d)(e)207-1-3(1)(1)2914
Other 20111-20(15)---2175
Total $4,128$52$199$372$(243)$(87)$140$(166)$4,395$19

  • Earnings effects are primarily included in the “GECC revenues from services” and “Interest and other financial charges” captions in the Statement of Earnings (Loss).
  • Transfers in and out of Level 3 are considered to occur at the beginning of the period. Transfers out of Level 3 were primarily a result of increased use of quotes from independent pricing vendors based on recent trading activity.
  • Represents the amount of unrealized gains or losses for the period included in earnings.
  • Represents derivative assets net of derivative liabilities and included cash accruals of $11 million and $8 million not reflected in the fair value hierarchy table for the six months ended June 30, 2015 and 2014, respectively.
  • Gains (losses) included in net realized/unrealized gains (losses) included in earnings were offset by the earnings effects from the underlying items that were economically hedged. See Note 15.
Non-recurring fair value amounts (as measured at the time of the adjustment) for those assets remeasured to fair value on a non-recurring basis
Remeasured during Remeasured during
the six months endedthe year ended
June 30, 2015December 31, 2014
(In millions)Level 2Level 3Level 2Level 3
Financing receivables and financing receivables held for sale$-$22,532$1$584
Cost and equity method investments-2,123-346
Long-lived assets, including real estate-159102718
Total$-$24,814$103$1,648

Three months ended June 30Six months ended June 30
(In millions)2015201420152014
Financing receivables and financing receivables held for sale $(27)$(89)$(2,447)$(117)
Cost and equity method investments(60)(42)(1,509)(203)
Long-lived assets, including real estate(25)(58)(81)(83)
Total$(112)$(189)$(4,037)$(403)
Significant Unobservable Inputs Used For Level Three Recurring And Nonrecurring Measurements [Table Text Block]
LEVEL 3 MEASUREMENTS - SIGNIFICANT UNOBSERVABLE INPUTS
Range
(Dollars in millions)Fair valueValuation techniqueUnobservable inputs(weighted average)
June 30, 2015
Recurring fair value measurements
Investment securities – Debt
U.S. corporate$855Income approachDiscount rate(a)1.8%-11.0% (7.0%)
State and municipal17Income approachDiscount rate(a)5.2%-5.2% (5.2%)
Asset-backed76Income approachDiscount rate(a)5.0%-5.5% (5.4%)
Corporate – non-U.S.227Income approachDiscount rate(a)6.5%-14.0% (7.4%)
Other financial assets197Income approach, EBITDA multiple6.2X-9.0X (7.3X)
Market comparablesCapitalization rate6.5%-7.8% (7.7%)
Non-recurring fair value measurements
Financing receivables and$22,483Income approachDiscount rate(a)0.1%-8.0% (6.7%)
financing receivables held for sale
Cost and equity method investments1,867Market comparablesPrice to book multiple0.4X-0.7X (0.6X)
Long-lived assets, including real estate17Income approachDiscount rate(a)2.0%-10.8% (6.8%)
December 31, 2014
Recurring fair value measurements
Investment securities – Debt
U.S. corporate$917Income approachDiscount rate(a)1.5%-14.8% (6.6%)
State and municipal17Income approachDiscount rate(a)4.9%-4.9% (4.9%)
Asset-backed102Income approachDiscount rate(a)4.3%-9.0% (5.6%)
Corporate – non-U.S.278Income approachDiscount rate(a)3.3%-14.0% (6.5%)
Other financial assets117Income approach, EBITDA multiple5.4X-9.1X (7.7X)
Market comparablesCapitalization rate6.5%-7.8% (7.7%)
Non-recurring fair value measurements
Cost and equity method investments309Income approach,Discount rate(a)8.0%-10.0% (9.4%)
Market comparablesEBITDA multiple1.8X-5.2X (4.8X)
Long-lived assets, including real estate664Income approachDiscount rate(a)2.0%-10.8% (6.7%)

Discount rates are determined based on inputs that market participants would use when pricing investments, including credit and liquidity risk. An increase in the discount rate would result in a decrease in the fair value.