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Fair Value Option (Tables)
 9 Months Ended
Sep. 30, 2019
Fair Value Disclosures [Abstract]  
Schedule of Fair Value Option Elections The following tables provide information about the fair
value carrying amount and the contractual principal outstanding of assets and liabilities accounted for under the fair value option at September 30, 2019 and December 31, 2018, and information about where changes in the fair value of assets and liabilities accounted for under the fair value option are included in the Consolidated Statement of Income for the three and nine months ended September 30, 2019 and 2018.
 
 
 
 
 
 
 
 
 
 
 
 
Fair Value Option Elections
 
 
 
 
 
 
 
 
 
 
 
 
 
September 30, 2019
 
December 31, 2018
(Dollars in millions)
Fair Value Carrying Amount
 
Contractual Principal Outstanding
 
Fair Value Carrying Amount Less Unpaid Principal
 
Fair Value
Carrying
Amount
 
Contractual Principal Outstanding
 
Fair Value Carrying
Amount Less Unpaid Principal
Federal funds sold and securities borrowed or purchased under agreements to resell
$
50,298

 
$
50,238

 
$
60

 
$
56,399

 
$
56,376

 
$
23

Loans reported as trading account assets (1)
5,362

 
12,390

 
(7,028
)
 
6,195

 
13,088

 
(6,893
)
Trading inventory – other
17,989

 
n/a

 
n/a

 
13,778

 
n/a

 
n/a

Consumer and commercial loans
7,674

 
7,738

 
(64
)
 
4,349

 
4,399

 
(50
)
Loans held-for-sale (1)
5,011

 
6,119

 
(1,108
)
 
2,942

 
4,749

 
(1,807
)
Other assets
1

 
n/a

 
n/a

 
3

 
n/a

 
n/a

Long-term deposits
626

 
599

 
27

 
492

 
454

 
38

Federal funds purchased and securities loaned or sold under agreements to repurchase
21,963

 
21,966

 
(3
)
 
28,875

 
28,881

 
(6
)
Short-term borrowings
3,458

 
3,458

 
—

 
1,648

 
1,648

 
—

Unfunded loan commitments
116

 
n/a

 
n/a

 
169

 
n/a

 
n/a

Long-term debt (2)
36,773

 
36,626

 
147

 
27,689

 
29,198

 
(1,509
)

(1) 
A significant portion of the loans reported as trading account assets and LHFS are distressed loans that were purchased at a deep discount to par, and the remainder are loans with a fair value near contractual principal outstanding.
(2) 
Includes structured liabilities with a fair value of $36.4 billion and $27.3 billion, and contractual principal outstanding of $36.2 billion and $28.8 billion at September 30, 2019 and December 31, 2018.
n/a = not applicable
 
 
 
 
 
 
 
 
 
 
 
 
Gains (Losses) Relating to Assets and Liabilities Accounted for Under the Fair Value Option
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended September 30
 
2019
 
2018
(Dollars in millions)
Trading Account Income
 
Other
Income
 
Total
 
Trading Account Income
 
Other
Income
 
Total
Loans reported as trading account assets (1)
$
4

 
$
—

 
$
4

 
$
74

 
$
—

 
$
74

Trading inventory – other (2)
(156
)
 
—

 
(156
)
 
1,693

 
—

 
1,693

Consumer and commercial loans (1)
81

 
(6
)
 
75

 
176

 
8

 
184

Loans held-for-sale (1)
—

 
28

 
28

 
—

 
8

 
8

Long-term debt (3, 4)
(127
)
 
(20
)
 
(147
)
 
143

 
(19
)
 
124

Other (5)
(1
)
 
(1
)
 
(2
)
 
2

 
52

 
54

Total
$
(199
)

$
1


$
(198
)

$
2,088


$
49


$
2,137

 
 
 
 
 
 
 
 
 
 
 
 
 
Nine Months Ended September 30
 
2019
 
2018
Loans reported as trading account assets (1)
$
167

 
$
—

 
$
167

 
$
145

 
$
—

 
$
145

Trading inventory – other (2)
4,211

 
—

 
4,211

 
3,649

 
—

 
3,649

Consumer and commercial loans (1)
98

 
11

 
109

 
301

 
(24
)
 
277

Loans held-for-sale (1)
—

 
110

 
110

 
1

 
12

 
13

Long-term debt (3, 4)
(1,412
)
 
(65
)
 
(1,477
)
 
1,497

 
(75
)
 
1,422

Other (5)
8

 
20

 
28

 
15

 
75

 
90

Total
$
3,072


$
76


$
3,148


$
5,608


$
(12
)

$
5,596


(1) 
Gains (losses) related to borrower-specific credit risk were not significant.
(2) 
The gains (losses) in trading account income are primarily offset by (losses) gains on trading liabilities that hedge these assets.
(3) 
The net gains (losses) in trading account income relate to the embedded derivatives in structured liabilities and are typically offset by (losses) gains on derivatives and securities that hedge these liabilities.
(4) 
For the cumulative impact of changes in the Corporation’s own credit spreads and the amount recognized in accumulated OCI, see Note 14 – Accumulated Other Comprehensive Income (Loss). For more information on how the Corporation’s own credit spread is determined, see Note 20 – Fair Value Measurements to the Consolidated Financial Statements of the Corporation’s 2018 Annual Report on Form 10-K.
(5) 
Includes gains (losses) on federal funds sold and securities borrowed or purchased under agreements to resell, long-term deposits, federal funds purchased and securities loaned or sold under agreements to repurchase, short-term borrowings and unfunded loan commitments.