Offsetting Assets and Liabilities

Certain financial instruments and derivative instruments are eligible for offset in the Consolidated Balance Sheets under GAAP. The Company’s derivative instruments, repurchase agreements and securities borrowing and lending agreements are subject to master netting arrangements and collateral arrangements and meet the GAAP guidance to qualify for offset. A master netting arrangement with a counterparty creates a right of offset for amounts due to and from that same counterparty that is enforceable in the event of a default or bankruptcy. Securities borrowed and loaned result from transactions between the Company’s broker dealer subsidiary and other financial institutions and are recorded at the amount of cash collateral advanced or received. The Company’s policy is to recognize amounts subject to master netting arrangements on a gross basis on the Consolidated Balance Sheets.

The following tables present the gross and net information about the Company’s assets subject to master netting arrangements:



	September 30, 2013
	Gross Amounts of Recognized Assets		Gross Amounts Offset in the Consolidated Balance Sheets		Amounts of Assets Presented in the Consolidated Balance Sheets		Gross Amounts Not Offset in the Consolidated Balance Sheets
	Gross Amounts of Recognized Assets		Gross Amounts Offset in the Consolidated Balance Sheets				Financial Instruments⁽¹⁾			Cash Collateral			Securities Collateral			Net Amount
	(in millions)
Derivatives:
OTC	$	3,030	$	—	$	3,030	$	(2,875	)	$	(97	)	$	(35	)	$	23
OTC cleared	17		—		17		(13		)	(4		)	—			—
Exchange-traded	116		—		116		—			—			—			116
Total derivatives	3,163		—		3,163		(2,888		)	(101		)	(35		)	139
Securities borrowed	95		—		95		(40		)	(55		)	—			—
Total	$	3,258	$	—	$	3,258	$	(2,928	)	$	(156	)	$	(35	)	$	139



	December 31, 2012
	Gross Amounts of Recognized Assets		Gross Amounts Offset in the Consolidated Balance Sheets		Amounts of Assets Presented in the Consolidated Balance Sheets		Gross Amounts Not Offset in the Consolidated Balance Sheets
`	Gross Amounts of Recognized Assets		Gross Amounts Offset in the Consolidated Balance Sheets				Financial Instruments⁽¹⁾			Cash Collateral			Securities Collateral			Net Amount
	(in millions)
Derivatives:
OTC	$	3,527	$	—	$	3,527	$	(2,706	)	$	(428	)	$	(355	)	$	38
Exchange-traded	96		—		96		—			—			—			96
Total derivatives	3,623		—		3,623		(2,706		)	(428		)	(355		)	134
Securities borrowed	135		—		135		(67		)	(68		)	—			—
Total	$	3,758	$	—	$	3,758	$	(2,773	)	$	(496	)	$	(355	)	$	134

⁽¹⁾ Represents the amount of assets that could be offset by liabilities with the same counterparty under master netting or similar arrangements that management elects not to offset on the Consolidated Balance Sheets.

The following tables present the gross and net information about the Company’s liabilities subject to master netting arrangements:



	September 30, 2013
	Gross Amounts of Recognized Liabilities		Gross Amounts Offset in the Consolidated Balance Sheets		Amounts of Liabilities Presented in the Consolidated Balance Sheets		Gross Amounts Not Offset in the Consolidated Balance Sheets
	Gross Amounts of Recognized Liabilities		Gross Amounts Offset in the Consolidated Balance Sheets				Financial Instruments⁽¹⁾			Cash Collateral			Securities Collateral			Net Amount
	(in millions)
OTC derivatives	$	3,962	$	—	$	3,962	$	(2,875	)	$	—		$	(1,070	)	$	17
OTC cleared derivatives	15		—		15		(13		)	(2		)	—			—
Total derivatives	3,977		—		3,977		(2,888		)	(2		)	(1,070		)	17
Securities loaned	92		—		92		(40		)	(52		)	—			—
Repurchase agreements	150		—		150		—			—			(150		)	—
Total	$	4,219	$	—	$	4,219	$	(2,928	)	$	(54	)	$	(1,220	)	$	17



	December 31, 2012
	Gross Amounts of Recognized Liabilities		Gross Amounts Offset in the Consolidated Balance Sheets		Amounts of Liabilities Presented in the Consolidated Balance Sheets		Gross Amounts Not Offset in the Consolidated Balance Sheets
	Gross Amounts of Recognized Liabilities		Gross Amounts Offset in the Consolidated Balance Sheets				Financial Instruments⁽¹⁾			Cash Collateral			Securities Collateral			Net Amount
	(in millions)
OTC derivatives	$	3,310	$	—	$	3,310	$	(2,706	)	$	(67	)	$	(531	)	$	6
Securities loaned	145		—		145		(67		)	(78		)	—			—
Repurchase agreements	501		—		501		—			—			(501		)	—
Total	$	3,956	$	—	$	3,956	$	(2,773	)	$	(145	)	$	(1,032	)	$	6

⁽¹⁾ Represents the amount of liabilities that could be offset by assets with the same counterparty under master netting or similar arrangements that management elects not to offset on the Consolidated Balance Sheets.

In the tables above, the amounts of assets or liabilities presented in the Consolidated Balance Sheets are offset first by financial instruments that have the right of offset under master netting or similar arrangements, then any remaining amount is reduced by the amount of cash and securities collateral. The actual amounts of collateral may be greater than amounts presented in the tables.

The Company’s freestanding derivative instruments are reflected in other assets and other liabilities. Repurchase agreements are reflected in short-term borrowings. Securities borrowing and lending agreements are reflected in receivables and other liabilities, respectively. See Note 12 for additional disclosures related to the Company’s derivative instruments, Note 9 for additional disclosures related to the Company’s repurchase agreements and Note 3 for information related to derivatives held by consolidated investment entities.