XML 38 R29.htm IDEA: XBRL DOCUMENT v3.10.0.1
Derivative Financial Instruments and Hedging Activities (Tables)
 6 Months Ended
Jun. 30, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule of Derivative Instruments
The table below presents the gross amounts of fair value of our derivative instruments and the associated notional amounts:
 
 
June 30, 2018
 
December 31, 2017
 
 
Notional
 
Fair Value of Assets(a)
 
Fair Value of Liabilities(a)
 
Notional
 
Fair Value of Assets(a)
 
Fair Value of Liabilities(a)
Derivatives designated as hedges
 
 
 
 
 
 
 
 
 
 
 
 
Fair value hedges
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate contracts
 
$
11,154

 
$
2

 
$
460

 
$
11,110

 
$
2

 
$
290

Cash flow hedges
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate contracts
 
1,108

 
14

 
—

 
2,177

 
15

 
—

Foreign currency swaps
 
2,122

 
95

 
36

 
1,574

 
103

 
—

Derivatives not designated as hedges
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate contracts
 
89,753

 
534

 
563

 
81,938

 
329

 
207

Foreign currency swaps
 
1,884

 
61

 
46

 
1,201

 
104

 
—

Total(b)
 
$
106,021

 
$
706

 
$
1,105

 
$
98,000

 
$
553

 
$
497

 _________________
(a)
The gross amounts of the fair value of our assets and liabilities are included in other assets and other liabilities, respectively. Amounts accrued for interest payments in a net receivable position are included in other assets. All our derivatives are categorized within Level 2 of the fair value hierarchy. The fair value for Level 2 instruments was derived using the market approach based on observable market inputs including quoted prices of similar instruments and foreign exchange and interest rate forward curves.
(b)
We primarily enter into derivatives contracts through AmeriCredit Financial Services, Inc. (AFSI); however our SPEs may also be parties to derivative transactions. Agreements between AFSI and its derivative counterparties include rights of setoff for positions with offsetting values or for collateral held or posted. At June 30, 2018 and December 31, 2017, the fair value of assets and liabilities available for offset was $463 million and $284 million. At June 30, 2018 and December 31, 2017, we held $57 million and $25 million and posted $593 million and $299 million of collateral available for netting.
Schedule of Fair Value Hedging Instruments, Statements of Financial Performance and Financial Position, Location
As of June 30, 2018, the following amounts were recorded in the condensed consolidated balance sheet related to items designated and qualifying as hedged items in fair value hedging relationships:
 
June 30, 2018
 
Carrying Amount of Hedged Items
 
Cumulative Amount of Fair Value Hedging Adjustments(a)
Unsecured debt
$
15,452

 
$
685

 _________________
(a)
Includes $167 million of hedging adjustment remaining on hedged items for which hedge accounting has been discontinued.
Effect of Derivative Instruments on the Condensed Consolidated Statements of Income
The table below presents the effect of our derivative financial instruments in the condensed consolidated statement of income for the three and six months ended June 30, 2018:
 
Income (Losses) Recognized In Income
 
Three Months Ended June 30, 2018
 
Six Months Ended June 30, 2018
 
Interest Expense(a)
 
Other Operating Expenses(b)
 
Interest Expense(a)
 
Other Operating Expenses(b)
Fair value hedges
 
 
 
 
 
 
 
Hedged items
$
69

 
$
—

 
$
277

 
$
—

Interest rate contracts
(76
)
 
—

 
(286
)
 
—

Cash flow hedges
 
 
 
 
 
 
 
Interest rate contracts
3

 
—

 
7

 
—

Foreign currency contracts
(13
)
 
(92
)
 
(22
)
 
(68
)
Derivatives not designated as hedges
 
 
 
 
 
 
 
Interest rate contracts
(1
)
 
—

 
5

 
—

Foreign currency contracts
(13
)
 
(109
)
 
(20
)
 
(87
)
Total
$
(31
)
 
$
(201
)
 
$
(39
)
 
$
(155
)
_________________
(a)
Total interest expense was $803 million and $1,535 million for the three and six months ended June 30, 2018.
(b)
Activity is offset by translation activity also recorded in other operating expenses related to foreign currency-denominated loans. Total other operating expense was $159 million and $303 million for the three and six months ended June 30, 2018.

The table below presents the effect of our derivative financial instruments in the condensed consolidated statement of income for the three and six months ended June 30, 2017:
 
Income (Losses) Recognized In Income
 
Three Months Ended June 30, 2017
 
Six Months Ended June 30, 2017
Fair value hedges
 
 
 
Interest rate contracts(a)(b)
$
18

 
$
29

Cash flow hedges
 
 
 
Interest rate contracts(a)
1

 
(1
)
Foreign currency contracts(c)
49

 
55

Derivatives not designated as hedges
 
 
 
Interest rate contracts(a)
(4
)
 
(9
)
Foreign currency contracts(c)(d)
42

 
35

Total
$
106

 
$
109

_________________
(a)
Recognized in earnings as interest expense.
(b)
Includes hedge ineffectiveness which reflects the net change in the fair value of interest rate contracts offset by the change in fair value of hedged debt attributable to the hedged risk.
(c)
Recognized in earnings as other operating expenses and interest expense.
(d)
Activity is partially offset by translation activity (included in other operating expenses) related to foreign currency-denominated loans.
 
Gains (Losses) Recognized In
Accumulated Other Comprehensive Loss
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2018
 
2017
 
2018
 
2017
Cash flow hedges
 
 
 
 
 
 
 
Interest rate contracts
$
1

 
$
(1
)
 
$
5

 
$
1

Foreign currency contracts
(58
)
 
24

 
(40
)
 
21

Total
$
(57
)
 
$
23

 
$
(35
)
 
$
22

 
Gains (Losses) Reclassified From
Accumulated Other Comprehensive Loss Into Income
 
Location of Amounts Reclassified from Accumulated OCI
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2018
 
2017
 
2018
 
2017
 
Cash flow hedges
 
 
 
 
 
 
 
 
 
Interest rate contracts
$
—

 
$
—

 
$
(3
)
 
$
1

 
Interest expense
Foreign currency contracts
74

 
(30
)
 
56

 
(34
)
 
Interest expense
Total
$
74

 
$
(30
)
 
$
53

 
$
(33
)