Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

The table below presents goodwill balances by business segment at December 31, 2014 and 2013. Effective January 1, 2015, the Corporation changed its basis of presentation related to its business segments. For more information on this realignment, see Note 1 – Summary of Significant Accounting Principles. As part of the realignment, the Corporation moved a portion of the Business Banking business, including $1.6 billion of goodwill, from the former Consumer & Business Banking segment to Global Banking. This business constitutes a new reporting unit, Business Banking Regions, within the Global Banking segment. The remaining portion of the Business Banking business will be evaluated with Deposits as a single reporting unit within Consumer Banking. Prior periods have been reclassified to conform to current period presentation.

The reporting units utilized for goodwill impairment testing are the operating segments or one level below.




Goodwill

	December 31
(Dollars in millions)	2014		2013
Consumer Banking	$	30,125	$	30,123
Global Wealth & Investment Management	9,698		9,698
Global Banking	23,923		23,923
Global Markets	5,197		5,197
All Other	834		903
Total goodwill	$	69,777	$	69,844

For purposes of goodwill impairment testing, the Corporation utilizes allocated equity as a proxy for the carrying value of its reporting units. Allocated equity in the reporting units is comprised of allocated capital plus capital for the portion of goodwill and intangibles specifically assigned to the reporting unit. The goodwill impairment test involves comparing the fair value of each reporting unit with its carrying value, including goodwill, as measured by allocated equity. During 2014, the Corporation made refinements to the amount of capital allocated to each of its businesses based on multiple considerations that included, but were not limited to, risk-weighted assets measured under the Basel 3 Standardized and Advanced approaches, business segment exposures and risk profile, and strategic plans. As a result of this process, in 2014, the Corporation adjusted the amount of capital being allocated to its business segments. This change resulted in a reduction of the unallocated capital, which is reflected in All Other, and an aggregate increase to the amount of capital being allocated to the business segments. An increase in allocated capital in the business segments generally results in a reduction of the excess of the fair value over the carrying value and a reduction to the estimated fair value as a percentage of allocated carrying value for an individual reporting unit.

Also, certain changes were made to allocated capital to reflect the segment realignment described above. Prior periods have been reclassified to conform to the current period presentation.

There was no goodwill in LAS at December 31, 2014 and 2013.

Impairment Tests

During the three months ended September 30, 2014 and 2013, the Corporation completed its annual goodwill impairment test as of June 30 for all applicable reporting units. Based on the results of the annual goodwill impairment test, the Corporation determined there was no impairment.

The realignment triggered a test for goodwill impairment, which was performed both immediately before and after the realignment. In performing the goodwill impairment test, the Corporation compared the fair value of the affected reporting units with their carrying value as measured by allocated equity. The fair value of the affected reporting units exceeded their carrying value and, accordingly, no goodwill impairment resulted from the realignment.

Intangible Assets

The table below presents the gross carrying value and accumulated amortization for intangible assets at December 31, 2014 and 2013.




Intangible Assets ^{(1, 2)}

	December 31
	2014						2013
(Dollars in millions)	Gross Carrying Value		Accumulated Amortization		Net Carrying Value		Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Purchased credit card relationships	$	5,504	$	4,527	$	977	$	6,160	$	4,849	$	1,311
Core deposit intangibles	1,779		1,382		397		3,592		3,055		537
Customer relationships	4,025		2,648		1,377		4,025		2,281		1,744
Affinity relationships	1,565		1,283		282		1,575		1,197		378
Other intangibles	2,045		466		1,579		2,045		441		1,604
Total intangible assets	$	14,918	$	10,306	$	4,612	$	17,397	$	11,823	$	5,574


⁽¹⁾	Excludes fully amortized intangible assets.


⁽²⁾	At December 31, 2014 and 2013, none of the intangible assets were impaired.

The table below presents intangible asset amortization expense for 2014, 2013 and 2012.




Amortization Expense

(Dollars in millions)	2014		2013		2012
Purchased credit card and Affinity relationships	$	415	$	475	$	556
Core deposit intangibles	140		197		254
Customer relationships	355		371		391
Other intangibles	26		43		63
Total amortization expense	$	936	$	1,086	$	1,264

The table below presents estimated future intangible asset amortization expense at December 31, 2014.




Estimated Future Amortization Expense

(Dollars in millions)	2015		2016		2017		2018		2019
Purchased credit card and Affinity relationships	$	358	$	299	$	239	$	180	$	121
Core deposit intangibles	122		105		91		80		7
Customer relationships	340		325		310		302		286
Other intangibles	16		9		6		3		1
Total estimated future amortization expense	$	836	$	738	$	646	$	565	$	415

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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