NOTE 3 - FEDERAL FUNDS SOLD AND SECURITIES FINANCING ACTIVITIES

Fed funds sold and securities borrowed or purchased under agreements to resell were as follows:



(Dollars in millions)	December 31, 2014		December 31, 2013
Fed funds sold		$38		$75
Securities borrowed or purchased	290		184
Resell agreements	832		724
Total fed funds sold and securities borrowed or purchased under agreements to resell		$1,160		$983

Securities purchased under agreements to resell are primarily collateralized by U.S. government or agency securities and are carried at the amounts at which securities will be subsequently resold. Securities borrowed are primarily collateralized by corporate securities. The Company takes possession of all securities purchased under agreements to resell and securities borrowed and performs a margin evaluation on the acquisition date based on market volatility, as necessary. It is the Company's policy to obtain possession of collateral with a fair value between 95% to 110% of the principal amount loaned under resell and securities borrowing agreements. At December 31, 2014 and 2013, the total market value of collateral held was $1.1 billion and $913 million, of which $222 million and $234 million was repledged, respectively.

Securities sold under agreements to repurchase are accounted for as secured borrowings. The following table presents the Company’s related activity, by collateral type and remaining contractual maturity, at December 31, 2014.



	Remaining Contractual Maturity of the Agreements
(Dollars in millions)	Overnight and Continuous		Up to 30 days		Total
U.S. Treasury securities		$376		$—		$376
Federal agency securities	231		—		231
MBS - agency	1,059		45		1,104
CP	238		—		238
Corporate and other debt securities	327		—		327
Total securities sold under agreements to repurchase		$2,231		$45		$2,276

For these securities sold under agreements to repurchase, the Company would be obligated to provide additional collateral in the event of a significant decline in fair value of the collateral pledged. This risk is managed by monitoring the liquidity and credit quality of the collateral, as well as the maturity profile of the transactions.

Netting of Securities - Repurchase and Resell Agreements

The Company has various financial assets and financial liabilities that are subject to enforceable master netting agreements or similar agreements. The Company's derivatives that are subject to enforceable master netting agreements or similar agreements are discussed in Note 17, "Derivative Financial Instruments." Securities borrowed or purchased under agreements to resell and securities sold under agreements to repurchase are governed by a MRA. Under the terms of the MRA, all transactions between the Company and the counterparty constitute a single business relationship such that in the event of default, the nondefaulting party is entitled to set off claims and apply property held by that party in respect of any transaction against obligations owed. Any payments, deliveries, or other transfers may be applied against each other and netted. These amounts are limited to the contract asset/liability balance, and accordingly, do not include excess collateral received/pledged.

The following table presents the Company's eligible securities borrowed or purchased under agreements to resell and securities sold under agreements to repurchase at December 31, 2014 and 2013:



(Dollars in millions)	Gross Amount		Amount Offset		Net Amount Presented in Consolidated Balance Sheets			Held/Pledged Financial Instruments		Net Amount
December 31, 2014
Financial assets:
Securities borrowed or purchased under agreements to resell		$1,122		$—		$1,122	^1,2		$1,112		$10
Financial liabilities:
Securities sold under agreements to repurchase	2,276		—		2,276		¹	2,276		—

December 31, 2013
Financial assets:
Securities borrowed or purchased under agreements to resell		$908		$—		$908	^1,2		$899		$9
Financial liabilities:
Securities sold under agreements to repurchase	1,759		—		1,759		¹	1,759		—

¹ None of the Company's repurchase or resell transactions met the right of setoff criteria for net balance sheet presentation at December 31, 2014 and 2013.

²Excludes $38 million and $75 million of Fed funds sold which are not subject to a master netting agreement at December 31, 2014 and 2013, respectively.