NOTE 4 - TRADING ASSETS AND LIABILITIES AND DERIVATIVE INSTRUMENTS

The fair values of the components of trading assets and liabilities and derivative instruments are presented in the following table:



(Dollars in millions)	March 31, 2017		December 31, 2016
Trading Assets and Derivative Instruments:
U.S. Treasury securities		$450		$539
Federal agency securities	361		480
U.S. states and political subdivisions	55		134
MBS - agency	560		567
CLO securities	—		1
Corporate and other debt securities	590		656
CP	491		140
Equity securities	41		49
Derivative instruments ¹	863		984
Trading loans ²	2,596		2,517
Total trading assets and derivative instruments		$6,007		$6,067

Trading Liabilities and Derivative Instruments:
U.S. Treasury securities		$528		$697
MBS - agency	5		1
Corporate and other debt securities	326		255
Equity securities	5		—
Derivative instruments ¹	361		398
Total trading liabilities and derivative instruments		$1,225		$1,351

¹Amounts include the impact of offsetting cash collateral received from and paid to the same derivative counterparties, and the impact of netting derivative assets and derivative liabilities when a legally enforceable master netting agreement or similar agreement exists.

² Includes loans related to TRS.

Various trading and derivative instruments are used as part of the Company’s overall balance sheet management strategies and to support client requirements executed through the Bank and/or STRH, a broker/dealer subsidiary of the Company. The Company manages the potential market volatility associated with trading instruments with appropriate risk management strategies. The size, volume, and nature of the trading products and derivative instruments can vary based on economic conditions as well as client-specific and Company-specific asset or liability positions. Product offerings to clients include debt securities, loans traded in the secondary market, equity securities, derivative contracts, and other similar financial instruments. Other trading-related activities include acting as a market maker for certain debt and equity security transactions, derivative instrument transactions, and foreign exchange transactions. The Company also uses derivatives to manage its interest rate and market risk from non-trading activities. The Company has policies and procedures to manage market risk associated with client trading and non-trading activities, and assumes a limited degree of market risk by managing the size and nature of its exposure. For valuation assumptions and additional information related to the Company's trading products and derivative instruments, see Note 14, “Derivative Financial Instruments,” and the “Trading Assets and Derivative Instruments and Securities Available for Sale” section of Note 15, “Fair Value Election and Measurement.”

Pledged trading assets are presented in the following table:



(Dollars in millions)	March 31, 2017		December 31, 2016
Pledged trading assets to secure repurchase agreements ¹		$958		$968
Pledged trading assets to secure certain derivative agreements	273		471
Pledged trading assets to secure other arrangements	40		40

¹ Repurchase agreements secured by collateral totaled $918 million and $928 million at March 31, 2017 and December 31, 2016, respectively.