Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2014

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 3		adjustment		(b)	Net balance
June 30, 2014
Assets
Investment securities
Debt
U.S. corporate	$	0		$	20,093		$	3,126	$	0		$	23,219
State and municipal		0			4,985			560		0			5,545
Residential mortgage-backed		0			1,812			66		0			1,878
Commercial mortgage-backed		0			3,086			12		0			3,098
Asset-backed(c)		0			405			7,277		0			7,682
Corporate ̶ non-U.S.		51			702			1,042		0			1,795
Government ̶ non-U.S.		1,323			802			1		0			2,126
U.S. government and federal agency		0			498			249		0			747
Retained interests		0			0			73		0			73
Equity
Available-for-sale		260			15			9		0			284
Trading		51			2			0		0			53
Derivatives(d)		0			6,909			151		(5,938)			1,122
Other(e)		0			0			140		0			140
Total	$	1,685		$	39,309		$	12,706	$	(5,938)		$	47,762
Liabilities
Derivatives	$	0		$	3,352		$	18	$	(3,108)		$	262
Other		0			22			0		0			22
Total	$	0		$	3,374		$	18	$	(3,108)		$	284
December 31, 2013
Assets
Investment securities
Debt
U.S. corporate	$	0		$	18,788		$	2,918	$	0		$	21,706
State and municipal		0			4,193			96		0			4,289
Residential mortgage-backed		0			1,824			86		0			1,910
Commercial mortgage-backed		0			3,025			10		0			3,035
Asset-backed(c)		0			489			6,898		0			7,387
Corporate ̶ non-U.S.		61			645			1,052		0			1,758
Government ̶ non-U.S.		1,590			789			31		0			2,410
U.S. government and federal agency		0			545			225		0			770
Retained interests		0			0			72		0			72
Equity
Available-for-sale		225			15			11		0			251
Trading		72			2			0		0			74
Derivatives(d)		0			7,493			170		(6,546)			1,117
Other(e)		0			0			293		0			293
Total	$	1,948		$	37,808		$	11,862	$	(6,546)		$	45,072
Liabilities
Derivatives	$	0		$	4,893		$	16	$	(4,162)		$	747
Other		0			24			0		0			24
Total	$	0		$	4,917		$	16	$	(4,162)		$	771

• There were no securities transferred between Level 1 and Level 2in the six months ended June 30, 2014.
• 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.
• Includes investments in our CLL business in asset-backed securities collateralized by senior secured loans of high-quality, middle-market companies in a variety of industries.
• The fair value of derivatives includes an adjustment for non-performance risk. The cumulative adjustment was a gain (loss) of $18 million and $(7) million at June 30, 2014 and December 31, 2013, respectively. See Note 11 for additional information on the composition of our derivative portfolio.
• Includes private equity investments and loans designated under the fair value option.

Changes in level 3 instruments

Changes in Level 3 Instruments for the Three Months Ended
																					Net
																					change in
				Net			Net														unrealized
				realized/			realized/														gains
			unrealized			unrealized															(losses)
				gains			gains														relating to
				(losses)		(losses)									Transfers		Transfers				instruments
		Balance at		included		included									into		out of		Balance at		still held at
(In millions)		April 1	in earnings		(a)	in AOCI		Purchases			Sales		Settlements		Level 3(b)		Level 3(b)		June 30		June 30		(c)
2014
Investment securities
Debt
U.S. corporate	$	3,071	$	13		$	57		$	190	$	(157)	$	(27)	$	42	$	(63)	$	3,126	$	0
State and municipal		560		0			4			4		(7)		(1)		0		0		560		0
RMBS		81		1			1			0		(16)		(1)		0		0		66		0
CMBS		11		0			0			0		0		1		0		0		12		0
ABS		6,908		1			1			591		0		(214)		0		(10)		7,277		0
Corporate – non-U.S.		1,060		24			33			216		(64)		(222)		1		(6)		1,042		0
Government – non-U.S.		1		0			0			0		0		0		0		0		1		0
U.S. government and
federal agency		232		0			17			0		0		0		0		0		249		0
Retained interests		75		1			2			0		0		(5)		0		0		73		0
Equity
Available-for-sale		11		0			0			2		(2)		(2)		0		0		9		0
Derivatives(d)(e)		149		(4)			0			(1)		0		0		0		0		144		(4)
Other		99		1			0			154		0		(112)		0		(2)		140		0
Total	$	12,258	$	37		$	115		$	1,156	$	(246)	$	(583)	$	43	$	(81)	$	12,699	$	(4)

2013
Investment securities
Debt
U.S. corporate	$	3,542	$	7	$	(4)	$	33	$	(341)	$	(45)	$	15	$	-	$	3,207	$	-
State and municipal		90		-		(4)		12		-		-		-		-		98		-
RMBS		96		-		1		-		(2)		(4)		-		-		91		-
CMBS		6		-		-		-		-		(1)		-		-		5		-
ABS		4,916		1		(66)		766		(1)		(263)		-		(7)		5,346		-
Corporate – non-U.S.		1,336		(91)		7		1,985		-		(2,009)		-		(44)		1,184		-
Government – non-U.S.		41		-		(3)		-		-		-		-		-		38		-
U.S. government and
federal agency		264		-		-		-		-		-		-		-		264		-
Retained interests		91		2		6		2		-		(8)		-		-		93		-
Equity
Available-for-sale		11		-		-		-		-		-		-		-		11		-
Derivatives(d)(e)		170		(25)		1		(1)		-		(1)		26		-		170		(27)
Other		409		(100)		4		126		(1)		-		-		-		438		(92)
Total	$	10,972	$	(206)	$	(58)	$	2,923	$	(345)	$	(2,331)	$	41	$	(51)	$	10,945	$	(119)

• Earnings effects are primarily included in the Revenues from services and Interest captions in the Condensed Statement of Earnings.
• 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.
• Represented the amount of unrealized gains or losses for the period included in earnings.
• Represented derivative assets net of derivative liabilities and included cash accruals of $11 million and $6 millionnot reflected in the fair value hierarchy table in the three months ended June 30, 2014 and 2013, 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 11.

Changes in Level 3 Instruments for the Six Months Ended
																				Net
																				change in
			Net				Net													unrealized
			realized/				realized/													gains
			unrealized			unrealized														(losses)
			gains				gains													relating to
			(losses)			(losses)								Transfers		Transfers				instruments
	Balance at		included			included								into		out of		Balance at		still held at
(In millions)	January 1		in earnings		(a)	in AOCI		Purchases		Sales		Settlements		Level 3(b)		Level 3(b)		June 30		June 30		(c)
2014
Investment securities
Debt
U.S. corporate	$	2,918	$	21		$	120	$	343	$	(159)	$	(139)	$	138	$	(116)	$	3,126	$	-
State and municipal		96		-			31		13		(7)		(8)		435		-		560		-
RMBS		86		1			-		-		(16)		(5)		-		-		66		-
CMBS		10		-			-		-		-		-		2		-		12		-
ABS		6,898		2			(26)		996		-		(583)		-		(10)		7,277		-
Corporate – non-U.S.		1,052		3			79		436		(66)		(457)		1		(6)		1,042		-
Government – non-U.S.		31		-			-		-		-		-		-		(30)		1		-
U.S. government and
federal agency		225		-			26		-		-		-		-		(2)		249		-
Retained interests		72		3			5		1		-		(8)		-		-		73		-
Equity
Available-for-sale		11		-			-		2		(2)		(2)		-		-		9		-
Derivatives(d)(e)		163		(15)			-		(2)		-		(1)		(1)		-		144		(8)
Other		293		3			-		237		-		(112)		-		(281)		140		-
Total	$	11,855	$	18		$	235	$	2,026	$	(250)	$	(1,315)	$	575	$	(445)	$	12,699	$	(8)

2013
Investment securities
Debt
U.S. corporate	$	3,552	$	(251)	$	214	$	94	$	(347)	$	(90)	$	108	$	(73)	$	3,207	$	-
State and municipal		77		-		(4)		16		-		(1)		10		-		98		-
RMBS		100		-		(2)		-		(2)		(5)		-		-		91		-
CMBS		6		-		-		-		-		(1)		-		-		5		-
ABS		5,023		2		(68)		910		(1)		(525)		12		(7)		5,346		-
Corporate – non-U.S.		1,212		(83)		20		2,809		(3)		(2,742)		15		(44)		1,184		-
Government – non-U.S.		42		-		(4)		-		-		-		-		-		38		-
U.S. government and
federal agency		277		-		(13)		-		-		-		-		-		264		-
Retained interests		83		5		16		2		-		(13)		-		-		93		-
Equity
Available-for-sale		13		-		-		-		-		-		-		(2)		11		-
Derivatives(d)(e)		262		(63)		1		(2)		-		(54)		26		-		170		(34)
Other		432		(102)		4		159		(55)		-		-		-		438		(93)
Total	$	11,079	$	(492)	$	164	$	3,988	$	(408)	$	(3,431)	$	171	$	(126)	$	10,945	$	(127)

• Earnings effects are primarily included in the Revenues from services and Interest captions in the Condensed Statement of Earnings.
• 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 $6million not reflected in the fair value hierarchy table for the six months ended June 30, 2014 and 2013, 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 11.

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 ended				the year ended
	June 30, 2014				December 31, 2013
(In millions)	Level 2		Level 3		Level 2		Level 3
Financing receivables and loans held for sale	$	89	$	2,007	$	210	$	2,986
Cost and equity method investments		296		428		0		649
Long-lived assets, including real estate		361		225		2,050		1,085
Total	$	746	$	2,660	$	2,260	$	4,720

Significant Unobservable Inputs Used For Level Three Recurring And Nonrecurring Measurements [Table Text Block]

	Three months ended June 30				Six months ended June 30
(In millions)	2014		2013		2014		2013
Financing receivables and loans held for sale	$	(119)	$	(102)	$	(196)	$	(212)
Cost and equity method investments		(59)		(157)		(247)		(220)
Long-lived assets, including real estate		(134)		(253)		(178)		(593)
Total	$	(312)	$	(512)	$	(621)	$	(1,025)

Fair value adjustments to assets measured on a non-recurring basis

							Range
(Dollars in millions)	Fair value		Valuation technique		Unobservable inputs		(weighted average)
June 30, 2014
Recurring fair value measurements
Investment securities - Debt
U.S. corporate	$	968	Income approach		Discount rate(a)		1.4%-10.0% (6.4%)
State and municipal		466	Income approach		Discount rate(a)		1.8%-5.4% (3.3%)
Asset-backed		7,250	Income approach		Discount rate(a)		1.3%-9.5% (4.0%)
Corporate ̶ non-U.S.		605	Income approach		Discount rate(a)		0.8%-15.7% (8.5%)
Other financial assets		140	Income approach		Discount rate(a)		4.3%-4.8% (4.5%)
Non-recurring fair value measurements
Financing receivables and loans held for sale	$	909	Income approach, Business enterprise value		Capitalization rate(b)		2.7%-11.3% (7.0%)
					EBITDA multiple		4.3X-6.5X (6.0X)
Cost and equity method investments		154		Income approach,		Discount rate(a)		8.0%-10.0% (8.5%)
			Business enterprise value, Market comparables		EBITDA multiple		1.8X-9.4X (7.6X)
Long-lived assets, including real estate		69	Income approach		Capitalization rate(b)		5.0%-15.3% (7.3%)
					Discount rate(a)		4.0%-19.0% (8.9%)
December 31, 2013
Recurring fair value measurements
Investment securities - Debt
U.S. corporate	$	898	Income approach		Discount rate(a)		1.5%-13.3% (6.5%)
Asset-backed		6,854	Income approach		Discount rate(a)		1.2%-10.5% (3.7%)
Corporate ̶ non-U.S.		819	Income approach		Discount rate(a)		1.4%-46.0% (15.1%)
Other financial assets		288	Income approach, Market comparables		WACC(c)		9.3%-9.3% (9.3%)
					Discount rate(a)		5.2%-5.3% (5.3%)
					EBITDA multiple		8.3X-12.5X (10.6X)
Non-recurring fair value measurements
Financing receivables and loans held for sale	$	1,937	Income approach,		Capitalization rate(b)		5.5%-16.7% (8.0%)
			Business enterprise value		EBITDA multiple		4.3X-5.5X (4.8X)
					Discount rate(a)		6.6%-6.6% (6.6%)
Cost and equity method investments		100	Income approach, Market comparables		Discount rate(a)		5.7%-5.9% (5.8%)
					Capitalization rate(b)		8.5%-10.6% (10.0%)
					WACC(c)		9.3%-9.6% (9.4%)
					EBITDA multiple		7.1X-14.5X (11.3X)
					Revenue multiple		9.3X-12.6X (10.9X)
Long-lived assets, including real estate		691	Income approach		Capitalization rate(b)		5.4%-14.5% (7.8%)
					Discount rate(a)		4.0%-23.0% (8.8%)

• 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.
• Represents the rate of return on net operating income that is considered acceptable for an investor and is used to determine a property's capitalized value. An increase in the capitalization rate would result in a decrease in the fair value.
• Weighted average cost of capital (WACC).