INVESTMENT SECURITIES

Investment securities classified as current and long-term were as follows at March 31, 2018 and December 31, 2017, respectively:



	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(in millions)
March 31, 2018
U.S. Treasury and other U.S. government corporations and agencies:
U.S. Treasury and agency obligations	$	505	$	1	$	(5	)	$	501
Mortgage-backed securities	2,308		—		(56		)	2,252
Tax-exempt municipal securities	3,549		6		(61		)	3,494
Mortgage-backed securities:
Residential	24		—		(1		)	23
Commercial	580		—		(11		)	569
Asset-backed securities	554		1		(1		)	554
Corporate debt securities	4,693		131		(114		)	4,710
Total debt securities	$	12,213	$	139	$	(249	)	$	12,103

December 31, 2017
U.S. Treasury and other U.S. government corporations and agencies:
U.S. Treasury and agency obligations	$	532	$	1	$	(2	)	$	531
Mortgage-backed securities	1,625		4		(19		)	1,610
Tax-exempt municipal securities	3,884		33		(28		)	3,889
Mortgage-backed securities:
Residential	26		—		—			26
Commercial	455		3		(2		)	456
Asset-backed securities	407		1		—			408
Corporate debt securities	5,175		244		(37		)	5,382
Total debt securities	$	12,104	$	286	$	(88	)	$	12,302

Gross unrealized losses and fair values aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position were as follows at March 31, 2018 and December 31, 2017, respectively:



	Less than 12 months					12 months or more					Total
	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
	(in millions)
March 31, 2018
U.S. Treasury and other U.S. government corporations and agencies:
U.S. Treasury and agency obligations	$	362	$	(2	)	$	129	$	(3	)	$	491	$	(5	)
Mortgage-backed securities	1,489		(28		)	638		(28		)	2,127		(56		)
Tax-exempt municipal securities	2,409		(41		)	621		(20		)	3,030		(61		)
Mortgage-backed securities:
Residential	18		—			3		(1		)	21		(1		)
Commercial	451		(10		)	28		(1		)	479		(11		)
Asset-backed securities	162		(1		)	7		—			169		(1		)
Corporate debt securities	2,431		(60		)	761		(54		)	3,192		(114		)
Total debt securities	$	7,322	$	(142	)	$	2,187	$	(107	)	$	9,509	$	(249	)

December 31, 2017
U.S. Treasury and other U.S. government corporations and agencies:
U.S. Treasury and agency obligations	$	273	$	(1	)	$	130	$	(1	)	$	403	$	(2	)
Mortgage-backed securities	581		(2		)	672		(17		)	1,253		(19		)
Tax-exempt municipal securities	1,590		(16		)	661		(12		)	2,251		(28		)
Mortgage-backed securities:
Residential	20		—			3		—			23		—
Commercial	131		(1		)	28		(1		)	159		(2		)
Asset-backed securities	107		—			10		—			117		—
Corporate debt securities	1,297		(10		)	804		(27		)	2,101		(37		)
Total debt securities	$	3,999	$	(30	)	$	2,308	$	(58	)	$	6,307	$	(88	)

Approximately 99% of our debt securities were investment-grade quality, with a weighted average credit rating of AA by Standard & Poor's Rating Service, or S&P, at March 31, 2018. Most of the debt securities that were below investment-grade were rated BB, the higher end of the below investment-grade rating scale. Tax-exempt municipal securities were diversified among general obligation bonds of states and local municipalities in the United States as well as special revenue bonds issued by municipalities to finance specific public works projects such as utilities, water and sewer, transportation, or education. Our general obligation bonds are diversified across the United States with no individual state exceeding 9%. In addition, 2% of our tax-exempt securities were insured by bond insurers and had an equivalent weighted average S&P credit rating of AA exclusive of the bond insurers’ guarantee. Our investment policy limits investments in a single issuer and requires diversification among various asset types.

Our unrealized losses from all securities were generated from approximately 1,410 positions out of a total of approximately 2,230 positions at March 31, 2018. All issuers of securities we own that were trading at an unrealized loss at March 31, 2018 remain current on all contractual payments. After taking into account these and other factors previously described, we believe these unrealized losses primarily were caused by an increase in market interest rates in the current markets since the time the securities were purchased. At March 31, 2018, we did not intend to sell the securities with an unrealized loss position in accumulated other comprehensive income, and it is not likely that we will be required to sell these securities before recovery of their amortized cost basis. As a result, we believe that the securities with an unrealized loss were not other-than-temporarily impaired at March 31, 2018.

The detail of realized gains (losses) related to investment securities and included within investment income was as follows for the three months ended March 31, 2018 and 2017:



	Three months ended March 31,
	2018			2017
	(in millions)
Gross realized gains	$	32		$	27
Gross realized losses	(3		)	(1		)
Net realized capital gains	$	29		$	26

There were no material other-than-temporary impairments for the three months ended March 31, 2018 or 2017.

The contractual maturities of debt securities available for sale at March 31, 2018, regardless of their balance sheet classification, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.



	Amortized Cost		Fair Value
	(in millions)
Due within one year	$	856	$	854
Due after one year through five years	2,846		2,803
Due after five years through ten years	2,317		2,247
Due after ten years	2,728		2,801
Mortgage and asset-backed securities	3,466		3,398
Total debt securities	$	12,213	$	12,103