XML 73 R54.htm IDEA: XBRL DOCUMENT v3.10.0.1
Employee Benefit Plans (Tables)
 12 Months Ended
Dec. 31, 2018
Employee Benefit Plans [Abstract]  
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity [Table Text Block] The following table presents a summary of stock options, restricted stock, and RSU activity for the year ended December 31, 2018:
 
Stock Options
 
Restricted Stock
 
RSUs
(Dollars in millions, except per share data)
Shares
 
Price
Range
 
Weighted
Average
Exercise
Price
 
Shares
 
Deferred
Compensation
 
Weighted
Average
Grant
Price
 
Shares
 
Weighted
Average
Grant
Price
Balance, January 1, 2018
1,659,305

 
$9.06 - 64.58

 

$35.33

 
8,744

 

$1

 

$57.19

 
4,153,719

 

$44.68

Granted
—

 
—

 
—

 
7,404

 
1

 
67.53

 
2,709,623

 
67.95

Exercised/distributed
(774,704
)
 
9.06 - 64.58

 
46.72

 
(8,744
)
 
—

 
57.19

 
(1,808,091
)
 
42.84

Cancelled/expired/forfeited
—

 
—

 
—

 
—

 
—

 
—

 
(241,722
)
 
59.62

Amortization of restricted stock compensation
—

 
—

 
—

 
—

 
(1
)
 
—

 
—

 
—

Balance, December 31, 2018
884,601

 
$21.67 - 32.27

 

$25.36

 
7,404

 

$1

 

$67.53

 
4,813,529

 

$56.63

Exercisable, December 31, 2018
884,601

 
 
 

$25.36

 
 
 
 
 
 
 
 
 
 
Schedule of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range [Table Text Block] The following table presents stock option information at December 31, 2018:
 
Options Outstanding
 
Options Exercisable
(Dollars in millions, except per share data)
Number
Outstanding at
December 31, 2018
 
Weighted
Average
Exercise
Price
 
Weighted
Average
Remaining
Contractual
Life (Years)
 
Total
Aggregate
Intrinsic
Value
 
Number
Exercisable at
December 31, 2018
 
Weighted
Average
Exercise
Price
 
Weighted
Average
Remaining
Contractual
Life (Years)
 
Total
Aggregate
Intrinsic
Value
Range of Exercise Prices:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$21.67 to 32.27
884,601

 

$25.36

 
3
 

$22

 
884,601

 

$25.36

 
3
 

$22
Share-based Compensation Arrangements by Share-based Payment Award, Restricted Stock Units, Vested and Expected to Vest [Table Text Block] Additional option and stock-based compensation information at December 31 is presented in the following table:
(Dollars in millions)
2018
 
2017
 
2016
Intrinsic value of options exercised 1

$17

 

$28

 

$43

Fair value of vested restricted shares 1
1

 
—

 
41

Fair value of vested RSUs 1
77

 
62

 
74

1 Measured as of the grant date.
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block] Stock-based compensation expense recognized in Employee compensation in the Consolidated Statements of Income consisted of the following:
 
Years Ended December 31
(Dollars in millions)
2018
 
2017
 
2016
RSUs

$104

 

$83

 

$56

Phantom stock units 1
35

 
77

 
67

Restricted stock
1

 
—

 
2

Total stock-based compensation expense

$140

 

$160

 

$125

 
 
 
 
 
 
Stock-based compensation tax benefit 2

$34

 

$61

 

$48

1 Phantom stock units are settled in cash. The Company paid $76 million, $80 million, and $28 million during the years ended December 31, 2018, 2017, and 2016, respectively, related to these share-based liabilities.
2 Does not include excess tax benefits or deficiencies recognized in the Provision for income taxes in the Consolidated Statements of Income.
Schedule of Accumulated and Projected Benefit Obligations [Table Text Block] The following table presents the change in benefit obligations, change in fair value of plan assets, funded status, accumulated benefit obligation, and the weighted average discount rate related to the Company's pension and other postretirement benefits plans for the years ended December 31:
 
Pension Benefits 1
 
Other Postretirement Benefits
(Dollars in millions)
2018
 
2017
 
2018
 
2017
Benefit obligation, beginning of year

$2,910

 

$2,747

 

$58

 

$58

Service cost
6

 
5

 
—

 
—

Interest cost
91

 
95

 
1

 
1

Plan participants’ contributions
—

 
—

 
5

 
4

Actuarial (gain)/loss
(228
)
 
225

 
(2
)
 
(1
)
Benefits paid
(178
)
 
(156
)
 
(11
)
 
(8
)
Administrative expenses paid from pension trust
(6
)
 
(6
)
 
—

 
—

Plan amendments
—

 
—

 
—

 
(5
)
Special termination benefits
—

 
—

 
—

 
9

Settlement loss
(127
)
 
—

 
—

 
—

Benefit obligation, end of year 2

$2,468

 

$2,910

 

$51

 

$58

 
 
 
 
 
 
 
 
Change in plan assets:
 
 
 
 
 
 
 
Fair value of plan assets, beginning of year

$3,288

 

$3,016

 

$164

 

$157

Actual return on plan assets
(100
)
 
425

 
(3
)
 
11

Employer contributions 3
8

 
9

 
—

 
—

Plan participants’ contributions
—

 
—

 
5

 
4

Benefits paid
(178
)
 
(156
)
 
(11
)
 
(8
)
Administrative expenses paid from pension trust
(6
)
 
(6
)
 
—

 
—

Settlement loss
(127
)
 
—

 
—

 
—

Fair value of plan assets, end of year

$2,885

 

$3,288

 

$155

 

$164

 
 
 
 
 
 
 
 
Funded status at end of year 4, 5

$417

 

$378

 

$104

 

$106

Funded status at end of year (%)
117
%
 
113
%
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated benefit obligation

$2,468

 

$2,910

 
 
 
 
 
 
 
 
 
 
 
 
Discount rate
4.27
%
 
3.62
%
 
3.96
%
 
3.29
%
1 Employer contributions represent the benefits that were paid to nonqualified plan participants. Unfunded nonqualified supplemental pension plans are not funded through plan assets.
2 Includes $68 million and $78 million of benefit obligations for the unfunded nonqualified supplemental pension plans at December 31, 2018 and 2017, respectively.
3 The Company contributed less than $1 million to the other postretirement benefits plans during both 2018 and 2017.
4 Pension benefits included assets of $485 million and $456 million, and liabilities of $68 million and $78 million, at December 31, 2018 and 2017, respectively, recorded in Other assets in the Consolidated Balance Sheets.
5 Other postretirement benefits included assets of $104 million and $106 million at December 31, 2018 and 2017, respectively, recorded in Other assets in the Consolidated Balance Sheets.
Schedule of Net Benefit Costs [Table Text Block] Components of net periodic benefit related to the Company's pension and other postretirement benefits plans for the years ended December 31 are presented in the following table and are recognized in Employee benefits in the Consolidated Statements of Income:
 
Pension Benefits 1
 
Other Postretirement Benefits
 
(Dollars in millions)
2018
 
2017
 
2016
 
2018
 
2017
 
2016
 
Service cost

$6

 

$5

 

$5

 

$—

 

$—

 

$—

 
Interest cost
91

 
95

 
97

 
1

 
1

 
2

 
Expected return on plan assets
(187
)
 
(195
)
 
(186
)
 
(5
)
 
(5
)
 
(5
)
 
Amortization of prior service credit
—

 
—

 
—

 
(6
)
 
(6
)
 
(6
)
 
Amortization of actuarial loss
22

 
25

 
25

 
—

 
—

 
—

 
Deferred losses related to NCF Retirement Plan settlement
60

 
—

 
—

 
—

 
—

 
—

 
Other
—

 
—

 
—

 
—

 
9

 
—

 
Net periodic benefit

($8
)
 

($70
)
 

($59
)
 

($10
)
 

($1
)
 

($9
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average assumptions used to determine net periodic benefit:
 
 
 
 
 
 
 
 
 
 
 
Discount rate
3.62
%
 
4.18
%
 
4.44
%
 
3.29
%
 
3.70
%
 
3.95
%
 
Expected return on plan assets
5.90

 
6.66

 
6.68

 
3.10

 
3.12

 
3.13

 
Interest crediting rate
3.00

 
3.11

 
3.00

 
N/A

2 
N/A

2 
N/A

2 
1 Administrative fees are recognized in service cost for each of the periods presented.
2 Other postretirement benefits plans do not include any plans with promised interest crediting rates; thus the weighted-average interest crediting rate assumption is not applicable ("N/A") for other postretirement benefit plans for all periods presented.
Schedule of Defined Benefit Plan Amounts Recognized in Other Comprehensive Income (Loss) [Table Text Block] Components of the benefit obligations AOCI balance at December 31 were as follows:
 
Pension Benefits
 
Other Postretirement Benefits
(Dollars in millions)
2018
 
2017
 
2018
 
2017
Prior service credit

$—

 

$—

 

($52
)
 

($58
)
Net actuarial loss/(gain)
978

 
1,001

 
(17
)
 
(22
)
Total AOCI, pre-tax

$978

 

$1,001

 

($69
)
 

($80
)

Other changes in plan assets and benefit obligations recognized in AOCI during 2018 were as follows:
(Dollars in millions)
Pension Benefits
 
Other Postretirement Benefits
Current year actuarial loss

$59

 

$5

Amortization of prior service credit
—

 
6

Amortization of actuarial loss
(22
)
 
—

Deferred losses related to NCF Retirement Plan settlement
(60
)
 
—

Total recognized in AOCI, pre-tax

($23
)
 

$11

Total recognized in net periodic (benefit)/loss and AOCI, pre-tax

($31
)
 

$1
Schedule of Allocation of Plan Assets [Table Text Block] The following tables present combined pension and other postretirement benefit plan assets measured at fair value. See Note 20, "Fair Value Election and Measurement," for level definitions within the fair value hierarchy.
 
 
 
Fair Value Measurements at December 31, 2018 1
(Dollars in millions)
Total
 
Level 1
 
Level 2
 
Level 3
Money market funds 2

$112

 

$112

 

$—

 

$—

Equity securities
382

 
382

 
—

 
—

Mutual funds 3:
 
 
 
 
 
 
 
Equity index fund
46

 
46

 
—

 
—

Tax exempt municipal bond funds
86

 
86

 
—

 
—

Taxable fixed income index funds
12

 
12

 
—

 
—

Derivatives, net of collateral
2

 
—

 
2

 
—

Fixed income securities
2,377

 
333

 
2,044

 
—

Total plan assets

$3,017

 

$971

 

$2,046

 

$—

1 Fair value measurements do not include pension benefits accrued income amounting to less than 0.9% of total plan assets.
2 Includes $11 million for other postretirement benefit plans.
3 Relates exclusively to other postretirement benefit plans.

 
 
 
Fair Value Measurements at December 31, 2017 1
(Dollars in millions)
Total
Level 1
 
Level 2
 
Level 3
Money market funds 2

$138

 

$138

 

$—

 

$—

Equity securities
936

 
936

 
—

 
—

Mutual funds 3:
 
 
 
 
 
 
 
Equity index fund
56

 
56

 
—

 
—

Tax exempt municipal bond funds
85

 
85

 
—

 
—

Taxable fixed income index funds
12

 
12

 
—

 
—

Derivatives, net of collateral
(5
)
 
(5
)
 
—

 
—

Fixed income securities
2,201

 
512

 
1,689

 
—

Other assets
9

 
9

 
—

 
—

Total plan assets

$3,432

 

$1,743

 

$1,689

 

$—

1 Fair value measurements do not include pension benefits accrued income amounting to less than 0.7% of total plan assets.
2 Includes $11 million for other postretirement benefit plans.
3 Relates exclusively to other postretirement benefit plans.
Target allocations for pension and other postretirement benefits at December 31, by asset category, are presented below:
 
Pension Benefits
 
Other Postretirement Benefits
 
2018 Target Allocation
 
% of plan assets
 
2018 Target Allocation
 
% of plan assets
 
 
2018
 
2017
 
 
2018
 
2017
Cash equivalents
0-10
%
 
4
%
 
4
%
 
5-15
%
 
7
%
 
7
%
Equity securities
0-25
 
 
13

 
29

 
20-40
 
 
30

 
34

Debt securities
75-100
 
 
83

 
67

 
50-70
 
 
63

 
59

Total
 
 
 
100
%
 
100
%
 
 
 
 
100
%
 
100
%
Schedule of Expected Benefit Payments [Table Text Block] Expected cash flows for the pension and other postretirement benefit plans are presented in the following table:
(Dollars in millions)
Pension Benefits 1
 
Other Postretirement Benefits (excluding Medicare Subsidy) 2
Employer Contributions:
 
 
 
2019 (expected) to plan trusts

$—

 

$—

2019 (expected) to plan participants 3
7

 
—

 
 
 
 
Expected Benefit Payments:
 
 
 
2019
175

 
6

2020
161

 
6

2021
161

 
6

2022
159

 
5

2023
159

 
4

2024 - 2028
773

 
16

1 Based on the funding status and ERISA limitations, the Company anticipates contributions to the Retirement Plan will not be required during 2019.
2 Expected payments under other postretirement benefit plans are shown net of participant contributions.
3 The expected benefit payments for the SERP will be paid directly from the Company's corporate assets.