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Business Segments (Tables)
12 Months Ended
Dec. 31, 2017
Segment Reporting [Abstract]  
Summary of Impact of Changes to Internal Management Reporting
The following table summarizes the impact on reported segment profit before tax, total assets and total deposits as of and for the years ended December 31, 2016 and 2015:
 
2016
 
2015
 
(in millions)
Increase (decrease) in segment profit before tax during the year ended December 31:
 
 
 
RBWM
$
7

 
$
(4
)
CMB
13

 
8

GB&M
(192
)
 
(144
)
PB
5

 
4

CC (as compared with previously reported Other)
167

 
136

 
 
 
 
Increase (decrease) in segment total assets at December 31:
 
 
 
RBWM
$
(585
)
 
$
(696
)
CMB

 

GB&M
(107,780
)
 
(78,783
)
PB

 

CC (as compared with previously reported Other)
108,365

 
79,479

 
 
 
 
Increase (decrease) in segment total deposits at December 31:
 
 
 
RBWM
$

 
$

CMB

 

GB&M
(6,989
)
 
(5,011
)
PB

 

CC (as compared with previously reported Other)
6,989

 
5,011

Summary on Reconciliation of Results under Group Reporting Basis to US GAAP
The following table summarizes the results for each segment on a Group Reporting Basis, as well as provides a reconciliation of total results under the Group Reporting Basis to U.S. GAAP consolidated totals:
 
Group Reporting Basis Consolidated Amounts
 
 
 
 
 
 
 
RBWM
 
CMB
 
GB&M
 
PB
 
CC
 
Adjustments/
Reconciling
Items
 
Total
 
Group Reporting Basis
Adjustments(4)
 
Group Reporting Basis
Reclassi-
fications(5)
 
U.S. GAAP
Consolidated
Totals
 
(in millions)
Year Ended December 31, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net interest income(1)
$
886

 
$
739

 
$
585

 
$
217

 
$
(40
)
 
$

 
$
2,387

 
$
(48
)
 
$
(66
)
 
$
2,273

Other operating income(2)
526

 
216

 
617

 
94

 
274

 

 
1,727

 
200

 
75

 
2,002

Total operating income
1,412

 
955

 
1,202

 
311

 
234

 

 
4,114

 
152

 
9

 
4,275

Loan impairment charges
25

 
(52
)
 
(94
)
 
2

 

 

 
(119
)
 
(72
)
 
26

 
(165
)
 
1,387

 
1,007

 
1,296

 
309

 
234

 

 
4,233

 
224

 
(17
)
 
4,440

Operating expenses(2)
1,185

 
558

 
881

 
244

 
465

 

 
3,333

 
75

 
(17
)
 
3,391

Profit (loss) before income tax expense
$
202

 
$
449

 
$
415

 
$
65

 
$
(231
)
 
$

 
$
900

 
$
149

 
$

 
$
1,049

Balances at end of period:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets
$
18,707

 
$
23,644

 
$
72,734

 
$
8,190

 
$
97,038

 
$

 
$
220,313

 
$
(33,078
)
 
$

 
$
187,235

Total loans, net
16,685

 
22,444

 
19,125

 
6,405

 
3,556

 

 
68,215

 
(1,397
)
 
5,064

 
71,882

Goodwill
581

 
358

 

 
321

 

 

 
1,260

 
347

 

 
1,607

Total deposits
34,186

 
24,239

 
25,476

 
8,470

 
4,923

 

 
97,294

 
(3,261
)
 
24,669

 
118,702

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Year Ended December 31, 2016
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net interest income(1)
$
818

 
$
749

 
$
567

 
$
207

 
$
132

 
$
(2
)
 
$
2,471

 
$
(76
)
 
$
89

 
$
2,484

Other operating income(2)
363

 
229

 
785

 
89

 
127

 
2

 
1,595

 
(104
)
 
(87
)
 
1,404

Total operating income
1,181

 
978

 
1,352

 
296

 
259

 

 
4,066

 
(180
)
 
2

 
3,888

Loan impairment charges
70

 
50

 
383

 

 
(9
)
 

 
494

 
(78
)
 
(44
)
 
372

 
1,111

 
928

 
969

 
296

 
268

 

 
3,572

 
(102
)
 
46

 
3,516

Operating expenses(2)(3)
1,131

 
591

 
986

 
232

 
338

 

 
3,278

 
(26
)
 
46

 
3,298

Profit (loss) before income tax expense
$
(20
)
 
$
337

 
$
(17
)
 
$
64

 
$
(70
)
 
$

 
$
294

 
$
(76
)
 
$

 
$
218

Balances at end of period:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets
$
19,618

 
$
25,082

 
$
85,215

 
$
7,714

 
$
108,877

 
$

 
$
246,506

 
$
(45,234
)
 
$
29

 
$
201,301

Total loans, net
16,889

 
24,125

 
21,914

 
6,024

 
3,512

 

 
72,464

 
(405
)
 
799

 
72,858

Goodwill
581

 
358

 

 
325

 

 

 
1,264

 
348

 

 
1,612

Total deposits
32,472

 
22,005

 
22,260

 
11,618

 
6,989

 

 
95,344

 
(4,379
)
 
38,283

 
129,248

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Year Ended December 31, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net interest income(1)
$
787

 
$
747

 
$
409

 
$
205

 
$
181

 
$
(12
)
 
$
2,317

 
$
(78
)
 
$
231

 
$
2,470

Other operating income(2)
308

 
243

 
1,047

 
99

 
301

 
12

 
2,010

 
(39
)
 
(236
)
 
1,735

Total operating income
1,095

 
990

 
1,456

 
304

 
482

 

 
4,327

 
(117
)
 
(5
)
 
4,205

Loan impairment charges
68

 
140

 
65

 
(5
)
 
(4
)
 

 
264

 
130

 
(33
)
 
361

 
1,027

 
850

 
1,391

 
309

 
486

 

 
4,063

 
(247
)
 
28

 
3,844

Operating expenses(2)(3)
1,152

 
609

 
1,017

 
245

 
285

 

 
3,308

 
(52
)
 
28

 
3,284

Profit (loss) before income tax expense
$
(125
)
 
$
241

 
$
374

 
$
64

 
$
201

 
$

 
$
755

 
$
(195
)
 
$

 
$
560

Balances at end of period:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets
$
19,700

 
$
26,763

 
$
99,360

 
$
8,428

 
$
80,279

 
$

 
$
234,530

 
$
(46,569
)
 
$
317

 
$
188,278

Total loans, net
16,696

 
23,538

 
29,589

 
6,715

 
1,676

 

 
78,214

 
317

 
3,474

 
82,005

Goodwill
581

 
358

 

 
325

 

 

 
1,264

 
348

 

 
1,612

Total deposits
31,814

 
20,599

 
22,910

 
13,811

 
5,011

 

 
94,145

 
(4,097
)
 
28,531

 
118,579

 
(1)
Net interest income of each segment represents the difference between actual interest earned on assets and interest paid on liabilities of the segment adjusted for a funding charge or credit. Segments are charged a cost to fund assets (e.g. customer loans) and receive a funding credit for funds provided (e.g. customer deposits) based on equivalent market rates. The objective of these charges/credits is to transfer interest rate risk from the segments to one centralized unit in Balance Sheet Management and more appropriately reflect the profitability of the segments.
(2)
Expenses for the segments include fully apportioned corporate overhead expenses.
(3)
In 2017, we changed our presentation for certain cost reimbursements that were previously netted as an offset to affiliate expense. We now present these reimbursements gross in affiliate income. As a result, we have reclassified prior year amounts in order to conform to the current year presentation, which increased both RBWM other operating income and RBWM operating expenses $11 million during the year ended December 31, 2016 and also increased both GB&M other operating income and GB&M operating expenses $61 million and $63 million during the years ended December 31, 2016 and 2015, respectively. See Note 21, "Related Party Transactions," in the accompanying consolidated financial statements for additional information.
(4)
Represents adjustments associated with differences between U.S. GAAP and the Group Reporting Basis. These adjustments, which are more fully described above, consist of the following:
 
Net
Interest
Income
 
Other
Revenues
 
Provision
for Credit
Losses
 
Operating
Expenses
 
Profit (Loss)
before Income
Tax Expense
 
Total
Assets
 
(in millions)
December 31, 2017
 
 
 
 
 
 
 
 
 
 
 
Derivatives
$

 
$

 
$

 
$

 
$

 
$
(32,900
)
Goodwill

 
(1
)
 

 

 
(1
)
 
347

Litigation

 

 

 
8

 
(8
)
 

Loan impairment
(43
)
 

 
(72
)
 

 
29

 
(332
)
Loan origination
(19
)
 

 

 
(14
)
 
(5
)
 
42

Loans held for sale
9

 
141

 

 

 
150

 
21

Low income housing tax credit investments

 
(7
)
 

 

 
(7
)
 

Pension and other postretirement benefit costs

 

 

 
94

 
(94
)
 
(263
)
Property

 

 

 
(11
)
 
11

 
8

Structured notes and deposits

 
85

 

 

 
85

 

Other
5

 
(18
)
 

 
(2
)
 
(11
)
 
(1
)
Total adjustments
$
(48
)
 
$
200

 
$
(72
)
 
$
75

 
$
149

 
$
(33,078
)
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2016
 
 
 
 
 
 
 
 
 
 
 
Derivatives
$

 
$

 
$

 
$

 
$

 
$
(44,911
)
Goodwill

 

 

 

 

 
348

Litigation

 

 

 
(8
)
 
8

 
(3
)
Loan impairment
(57
)
 
7

 
(58
)
 
1

 
7

 
(326
)
Loan origination
(21
)
 

 

 
(19
)
 
(2
)
 
35

Loans held for sale

 
(80
)
 
(20
)
 

 
(60
)
 
(31
)
Low income housing tax credit investments

 
(9
)
 

 

 
(9
)
 

Pension and other postretirement benefit costs

 

 

 
19

 
(19
)
 
(191
)
Property

 

 

 
(19
)
 
19

 
16

Unquoted equity securities

 

 

 

 

 
(163
)
Other
2

 
(22
)
 

 

 
(20
)
 
(8
)
Total adjustments
$
(76
)
 
$
(104
)
 
$
(78
)
 
$
(26
)
 
$
(76
)
 
$
(45,234
)
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2015
 
 
 
 
 
 
 
 
 
 
 
Derivatives
$

 
$
(3
)
 
$

 
$

 
$
(3
)
 
$
(46,245
)
Goodwill

 

 

 

 

 
348

Litigation

 

 

 
(2
)
 
2

 

Loan impairment
(61
)
 
3

 
132

 
1

 
(191
)
 
(329
)
Loan origination
(22
)
 
(3
)
 

 
(47
)
 
22

 
49

Loans held for sale

 
(16
)
 
(2
)
 

 
(14
)
 
(4
)
Low income housing tax credit investments

 
(12
)
 

 

 
(12
)
 

Pension and other postretirement benefit costs

 

 

 
15

 
(15
)
 
(177
)
Property

 

 

 
(19
)
 
19

 
21

Unquoted equity securities

 

 

 

 

 
(228
)
Other
5

 
(8
)
 

 

 
(3
)
 
(4
)
Total adjustments
$
(78
)
 
$
(39
)
 
$
130

 
$
(52
)
 
$
(195
)
 
$
(46,569
)

(5) 
Represents differences in financial statement presentation between U.S. GAAP and the Group Reporting Basis.