Derivatives and Hedging Activities (Tables)

9 Months Ended

Sep. 30, 2013

Schedule of gross fair value of derivative instruments, including embedded derivatives

The following table presents the balance sheet location and the gross fair value of derivative instruments, including embedded derivatives:



		Assets					Liabilities
	Balance Sheet Location	September 30, 2013		December 31, 2012		Balance Sheet Location	September 30, 2013				December 31, 2012
		(in millions)					(in millions)
Derivatives designated as hedging instruments
Fair value hedges
Fixed rate debt	Other assets	$	117	$	167	Other liabilities	$	—			$	—
Total qualifying hedges		117		167			—				—
Derivatives not designated as hedging instruments
GMWB and GMAB
Interest rate contracts	Other assets	1,525		2,191		Other liabilities	1,554				1,486
Equity contracts	Other assets	1,443		1,215		Other liabilities	2,360				1,792
Credit contracts	Other assets	—		—		Other liabilities	6				—
Foreign currency contracts	Other assets	2		6		Other liabilities	—				—
Embedded derivatives ⁽¹⁾	N/A	—		—		Policyholder account balances, future policy benefits and claims	(256		)	⁽²⁾	833
Total GMWB and GMAB		2,970		3,412			3,664				4,111
Other derivatives:
Equity
EIA embedded derivatives	N/A	—		—		Policyholder account balances, future policy benefits and claims	4				2
IUL	Other assets	19		6		Other liabilities	7				1
IUL embedded derivatives	N/A	—		—		Policyholder account balances, future policy benefits and claims	96				45
Stock market certificates	Other assets	56		37		Other liabilities	49				30
Stock market certificates embedded derivatives	N/A	—		—		Customer deposits	7				8
Foreign exchange
Foreign currency	Other assets	1		—		Other liabilities	1				1
Commodity
Seed money	Other assets	—		1		Other liabilities	—				—
Total other		76		44			164				87
Total non-designated hedges		3,046		3,456			3,828				4,198
Total derivatives		$	3,163	$	3,623		$	3,828			$	4,198

N/A Not applicable.

⁽¹⁾The fair values of GMWB and GMAB embedded derivatives fluctuate based on changes in equity, interest rate and credit markets.

⁽²⁾The fair value of the GMWB and GMAB embedded derivatives was a net asset at September 30, 2013 and the amount is reported as a contra liability.

Schedule of payments to make and receive for options

The deferred premium associated with certain of the above options is paid or received semi-annually over the life of the option contract or at maturity. The following is a summary of the payments the Company is scheduled to make and receive for these options:



	Premiums Payable		Premiums Receivable
	(in millions)
2013⁽¹⁾	$	104	$	20
2014	347		58
2015	320		65
2016	289		49
2017	238		44
2018-2027	783		107

⁽¹⁾2013 amounts represent the amounts payable and receivable for the period from October 1, 2013 to December 31, 2013.

Not Designated as Hedges

Derivative instruments

Schedule of gain (loss) on derivative instruments

The following table presents a summary of the impact of derivatives not designated as hedging instruments on the Consolidated Statements of Operations:



		Amount of Gain (Loss) on Derivatives Recognized in Income
Derivatives not designated as hedging instruments	Location of Gain (Loss) on Derivatives Recognized in Income	Three Months Ended September 30,						Nine Months Ended September 30,
Derivatives not designated as hedging instruments	Location of Gain (Loss) on Derivatives Recognized in Income	2013			2012			2013			2012
		(in millions)
GMWB and GMAB
Interest rate contracts	Benefits, claims, losses and settlement expenses	$	(63	)	$	(12	)	$	(575	)	$	91
Equity contracts	Benefits, claims, losses and settlement expenses	(319		)	(402		)	(799		)	(909		)
Credit contracts	Benefits, claims, losses and settlement expenses	(3		)	—			5			(2		)
Foreign currency contracts	Benefits, claims, losses and settlement expenses	8			(6		)	15			(5		)
Embedded derivatives ⁽¹⁾	Benefits, claims, losses and settlement expenses	267			264			1,089			443
Total GMWB and GMAB		(110		)	(156		)	(265		)	(382		)
Other derivatives:
Interest
Bank assets	Net investment income	—			(7		)	—			(7		)
Seed money	Net investment income	—			—			2			—
Equity
IUL	Interest credited to fixed accounts	2			1			8			1
IUL embedded derivatives	Interest credited to fixed accounts	3			1			8			1
EIA	Interest credited to fixed accounts	1			—			2			1
EIA embedded derivatives	Interest credited to fixed accounts	—			—			(1		)	—
Stock market certificates	Banking and deposit interest expense	1			2			5			6
Stock market certificates embedded derivatives	Banking and deposit interest expense	—			2			(4		)	5
Seed money	Net investment income	(4		)	(2		)	(12		)	(5		)
Ameriprise Financial Franchise Advisor Deferred Compensation Plan	Distribution expenses	—			2			—			3
Deferred compensation	Distribution expenses	1			—			3			—
Deferred compensation	General and administrative expense	2			—			2			—
Foreign exchange
Foreign currency	Net investment income	—			1			(3		)	1
Commodity
Seed money	Net investment income	—			(1		)	1			(1		)
Total other		6			(1		)	11			5
Total derivatives		$	(104	)	$	(157	)	$	(254	)	$	(377	)

⁽¹⁾The fair values of GMWB and GMAB embedded derivatives fluctuate based on changes in equity, interest rate and credit markets.

Cash flow hedges

Derivative instruments

Schedule of gain (loss) on derivative instruments

The following tables present the impact of the effective portion of the Company’s cash flow hedges on the Consolidated Statements of Operations and the Consolidated Statements of Equity:



	Amount of Gain Recognized in Other Comprehensive Income (Loss) on Derivatives
	Three Months Ended September 30,				Nine Months Ended September 30,
Derivatives designated as hedging instruments	2013		2012		2013		2012
	(in millions)
Interest on debt	$	—	$	—	$	—	$	14



	Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	(in millions)
Other revenues	$	—		$	—		$	—		$	3
Interest and debt expense	2			1			3			3
Net investment income	(3		)	(2		)	(4		)	(5		)
Total	$	(1	)	$	(1	)	$	(1	)	$	1

Fair value hedges

Derivative instruments

Schedule of gain (loss) on derivative instruments

The following table presents the amounts recognized in income related to fair value hedges:



		Amount of Gain Recognized in Income on Derivatives
Derivatives designated as hedging instruments	Location of Gain Recorded into Income	Three Months Ended September 30,				Nine Months Ended September 30,
Derivatives designated as hedging instruments	Location of Gain Recorded into Income	2013		2012		2013		2012
		(in millions)
Fixed rate debt	Interest and debt expense	$	20	$	9	$	30	$	28

- Definition

Tabular disclosure of the location and amount of gains and losses reported in the statement of financial performance, or when applicable, the statement of financial position. For example, (a) gains and losses recognized in the income statement on derivative instruments designated and qualifying as hedging instruments in fair value hedges and related hedged items designated and qualifying in fair value hedges and (b) gains and losses initially recognized in other comprehensive income on derivative instruments designated and qualifying as cash flow hedges.

+ References+ Details

- Definition

Tabular disclosure of the location and fair value amounts of derivative instruments (and nonderivative instruments that are designated and qualify as hedging instruments) reported in the statement of financial position.

+ References+ Details