Derivatives and Hedging Activities (Tables)

12 Months Ended

Dec. 31, 2015

Table Text Block [Abstract]

Schedule of derivative instruments in statement of financial position, fair value

The following table summarizes the total fair value, excluding interest accruals, of derivative assets and liabilities as of December 31:

		Other Assets				Other Liabilities
		Fair Value				Fair Value
(Millions)		2015		2014		2015		2014
Derivatives designated as hedging instruments:
Interest rate contracts
	Fair value hedges	$	236	$	314	$	9	$	4
Foreign exchange contracts
	Net investment hedges		191		492		57		46
Total derivatives designated as hedging instruments			427		806		66		50
Derivatives not designated as hedging instruments:
	Foreign exchange contracts, including certain embedded derivatives(a)		117		185		135		114
Total derivatives, gross			544		991		201		164
Less: Cash collateral netting(b)			(155)		(158)		―		(4)
	Derivative asset and derivative liability netting(c)		(107)		(122)		(107)		(122)
Total derivatives, net(d)		$	282	$	711	$	94	$	38

• Includes foreign currency derivatives embedded in certain operating agreements.
• Represents the offsetting of derivative instruments and the right to reclaim cash collateral (a receivable) or the obligation to return cash collateral (a payable) arising from derivative instrument(s) executed with the same counterparty under an enforceable master netting arrangement.From time to time, the Company also receives non-cash collateral from counterparties in the form of security interests in U.S. Treasury securities, which reduces the Company’s risk exposure, but does not reduce the net exposure on the Company’s Consolidated Balance Sheets.The Company had such non-cash collateral, with a fair value of $91 million as of December 31, 2014,none of which was sold or repledged.The Company did not have any such non-cash collateral as of December 31, 2015. Additionally, the Company posted $149 million and $114 million as of December 31, 2015 and 2014, respectively, as initial margin on its centrally cleared interest rate swaps; such amounts are recorded within Other receivables on the Company’s Consolidated Balance Sheets and are not netted against the derivative balances.
• Represents the amount of netting of derivative assets and derivative liabilities executed with the same counterparty under an enforceable master netting arrangement.
• The Company has no individually significant derivative counterparties and therefore, no significant risk exposure to any single derivative counterparty. The total net derivative assets and derivative liabilities are presented within Other assets and Other liabilities on the Company’s Consolidated Balance Sheets.

Effect of fair value hedges on results of operations

The following table summarizes the impact on the Consolidated Statements of Income associated with the Company’s fair value hedges ofits fixed-rate long-term debt and its investment in ICBC for the years ended December 31:

	Gains (losses) recognized in income
(Millions)	Derivative contract							Hedged item							Net hedge
	Income Statement	Amount						Income Statement	Amount						ineffectiveness
Derivative relationship	Line Item	2015		2014		2013		Line Item	2015		2014			2013	2015		2014		2013
Interest rate contracts	Other expenses	$	(83)	$	(143)	$	(370)	Other expenses	$	93	$	148	$	351	$	10	$	5	$	(19)
Total return contract	Other non-interest							Other non-interest
	revenues	$	―	$	11	$	15	revenues	$	―	$	(11)	$	(15)	$	―	$	―	$	―

Impact of cash flow hedges and investment hedges on results of operations

	Gains (losses) recognized in income
	Amount reclassified from AOCI into income							Net hedge ineffectiveness
Description (Millions)	Income Statement Line Item	2015		2014		2013		Income Statement Line Item	2015		2014			2013
Net investment hedges:
Foreign exchange contracts	Other expenses	$	―	$	10	$	―	Other expenses	$	1	$	―	$	―

Derivative instruments gain loss recognized in income

The following table summarizes the impact on the Consolidated Statements of Income associated with the Company’s derivatives not designated as hedges for the years ended December 31:

	Pretax gains (losses)
		Amount
Description (Millions)	Income Statement Line Item	2015		2014		2013
Interest rate contracts	Other expenses	$	―	$	―	$	1
Foreign exchange contracts(a)	Other expenses		(39)		194		72
	Cost of Card Member services		5		4		―
Total		$	(34)	$	198	$	73

Foreign exchange contracts include forwards and embedded foreign currency derivatives.