6. Securities

Securities available for sale. These are securities that we intend to hold for an indefinite period of time but that may be sold in response to changes in interest rates, prepayment risk, liquidity needs or other factors. Securities available for sale are reported at fair value. Unrealized gains and losses (net of income taxes) deemed temporary are recorded in equity as a component of AOCI on the balance sheet. Unrealized losses on equity securities deemed to be “other-than-temporary,” and realized gains and losses resulting from sales of securities using the specific identification method, are included in “other income” on the income statement. Unrealized losses on debt securities deemed to be “other-than-temporary” are included in “other income” on the income statement or in AOCI in accordance with the applicable accounting guidance related to the recognition of OTTI of debt securities.

“Other securities” held in the available-for-sale portfolio consist of marketable equity securities that are traded on a public exchange such as the NYSE or NASDAQ and convertible preferred stock of a privately held company.

Held-to-maturity securities. These are debt securities that we have the intent and ability to hold until maturity. Debt securities are carried at cost and adjusted for amortization of premiums and accretion of discounts using the interest method. This method produces a constant rate of return on the adjusted carrying amount.

“Other securities” held in the held-to-maturity portfolio consist of foreign bonds and capital securities.

Unrealized losses on equity securities deemed to be “other-than-temporary,” and realized gains and losses resulting from sales of securities using the specific identification method, are included in “other income” on the income statement. Unrealized losses on debt securities deemed to be “other-than-temporary” are included in “other income” on the income statement or in AOCI in accordance with the applicable accounting guidance related to the recognition of OTTI of debt securities.

The amortized cost, unrealized gains and losses, and approximate fair value of our securities available for sale and held-to-maturity securities are presented in the following tables. Gross unrealized gains and losses represent the difference between the amortized cost and the fair value of securities on the balance sheet as of the dates indicated. Accordingly, the amount of these gains and losses may change in the future as market conditions change.


	March 31, 2015
in millions	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
SECURITIES AVAILABLE FOR SALE
States and political subdivisions	$	21	$	1		—	$	22
Collateralized mortgage obligations		11,116		124	$	77		11,163
Other mortgage-backed securities		1,870		32		—		1,902
Other securities		30		3		—		33

Total securities available for sale	$	13,037	$	160	$	77	$	13,120

HELD-TO-MATURITY SECURITIES
Collateralized mortgage obligations	$	4,749	$	26	$	30	$	4,745
Other mortgage-backed securities		234		2		—		236
Other securities		22		—		—		22

Total held-to-maturity securities	$	5,005	$	28	$	30	$	5,003


	December 31, 2014
in millions	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
SECURITIES AVAILABLE FOR SALE
States and political subdivisions	$	22	$	1		—	$	23
Collateralized mortgage obligations		11,310		96	$	136		11,270
Other mortgage-backed securities		2,004		32		1		2,035
Other securities		29		3		—		32

Total securities available for sale	$	13,365	$	132	$	137	$	13,360

HELD-TO-MATURITY SECURITIES
Collateralized mortgage obligations	$	4,755	$	15	$	57	$	4,713
Other mortgage-backed securities		240		1		—		241
Other securities		20		—		—		20

Total held-to-maturity securities	$	5,015	$	16	$	57	$	4,974


	March 31, 2014
in millions	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
SECURITIES AVAILABLE FOR SALE
States and political subdivisions	$	37		—		—	$	37
Collateralized mortgage obligations		10,541	$	136	$	208		10,469
Other mortgage-backed securities		1,817		25		10		1,832
Other securities		17		4		—		21

Total securities available for sale	$	12,412	$	165	$	218	$	12,359

HELD-TO-MATURITY SECURITIES
Collateralized mortgage obligations	$	4,806	$	9	$	102	$	4,713
Other securities		20		—		—		20

Total held-to-maturity securities	$	4,826	$	9	$	102	$	4,733

The following table summarizes our securities that were in an unrealized loss position as of March 31, 2015, December 31, 2014, and March 31, 2014.


	Duration of Unrealized Loss Position
	Less than 12 Months				12 Months or Longer				Total
in millions	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
March 31, 2015
Securities available for sale:
Collateralized mortgage obligations	$	1,722	$	25	$	2,722	$	52	$	4,444	$	77
Other mortgage-backed securities^(a)		39		—		—		—		39		—
Other securities^(b)		3		—		2		—		5		—
Held-to-maturity:
Collateralized mortgage obligations		637		8		1,348		22		1,985		30
Other securities^(c)		4		—		—		—		4		—

Total temporarily impaired securities	$	2,405	$	33	$	4,072	$	74	$	6,477	$	107

December 31, 2014
Securities available for sale:
Collateralized mortgage obligations	$	3,019	$	52	$	2,932	$	84	$	5,951	$	136
Other mortgage-backed securities		—		—		78		1		78		1
Other securities^(b)		4		—		2		—		6		—
Held-to-maturity:
Collateralized mortgage obligations		1,005		11		1,994		46		2,999		57

Total temporarily impaired securities	$	4,028	$	63	$	5,006	$	131	$	9,034	$	194

March 31, 2014
Securities available for sale:
Collateralized mortgage obligations	$	4,401	$	173	$	678	$	35	$	5,079	$	208
Other mortgage-backed securities		1,153		10		—		—		1,153		10
Other securities^(b)		—		—		2		—		2		—
Held-to-maturity:
Collateralized mortgage obligations		3,139		92		200		10		3,339		102
Other securities^(c)		—		—		—		—		—		—

Total temporarily impaired securities	$	8,693	$	275	$	880	$	45	$	9,573	$	320

(a)	Gross unrealized losses totaled less than $1 million for other mortgage-backed securities available sale for the three-month period ended March 31, 2015.

(b)	Gross unrealized losses totaled less than $1 million for other securities available sale for the three-month period ended March 31, 2015, the year ended December 31, 2014, and the three-month period ended March 31, 2014.

(c)	Gross unrealized losses totaled less than $1 million for other securities held-to-maturity for the three-month periods ended March 31, 2015, and March 31, 2014.

At March 31, 2015, we had $77 million of gross unrealized losses related to 56 fixed-rate CMOs that we invested in as part of our overall A/LM strategy. These securities had a weighted-average maturity of 3.9 years at March 31, 2015. Since these securities have a fixed interest rate, their fair value is sensitive to movements in market interest rates. These unrealized losses are considered temporary since we expect to collect all contractually due amounts from these securities. Accordingly, these investments were reduced to their fair value through OCI, not earnings.

We regularly assess our securities portfolio for OTTI. The assessments are based on the nature of the securities, the underlying collateral, the financial condition of the issuer, the extent and duration of the loss, our intent related to the individual securities, and the likelihood that we will have to sell securities prior to expected recovery.

The debt securities identified to have OTTI are written down to their current fair value. For those debt securities that we intend to sell, or more-likely-than-not will be required to sell, prior to the expected recovery of the amortized cost, the entire impairment (i.e., the difference between amortized cost and the fair value) is recognized in earnings. For those debt securities that we do not intend to sell, or more-likely-than-not will not be required to sell, prior to expected recovery, the credit portion of OTTI is recognized in earnings, while the remaining OTTI is recognized in equity as a component of AOCI on the balance sheet. As shown in the following table, we had less than $1 million of impairment losses recognized in earnings for the three months ended March 31, 2015.


Three months ended March 31, 2015
in millions
Balance at December 31, 2014	$	4
Impairment recognized in earnings		—

Balance at March 31, 2015	$	4

Realized gains and losses related to securities available for sale were as follows:


Three months ended March 31, 2015
in millions
Realized gains			—
Realized losses			—

Net securities gains (losses)			—

At March 31, 2015, securities available for sale and held-to-maturity securities totaling $8 billion were pledged to secure securities sold under repurchase agreements, to secure public and trust deposits, to facilitate access to secured funding, and for other purposes required or permitted by law.

The following table shows securities by remaining maturity. CMOs and other mortgage-backed securities (both of which are included in the securities available-for-sale portfolio) as well as the CMOs in the held-to-maturity portfolio are presented based on their expected average lives. The remaining securities, in both the available-for-sale and held-to-maturity portfolios, are presented based on their remaining contractual maturity. Actual maturities may differ from expected or contractual maturities since borrowers have the right to prepay obligations with or without prepayment penalties.


	Securities				Held-to-Maturity
	Available for Sale				Securities
March 31, 2015	Amortized		Fair		Amortized		Fair
in millions	Cost		Value		Cost		Value
Due in one year or less	$	288	$	292	$	9	$	9
Due after one through five years		12,599		12,676		4,504		4,498
Due after five through ten years		147		149		492		496
Due after ten years		3		3		—		—

Total	$	13,037	$	13,120	$	5,005	$	5,003