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 on the balance sheet 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 on the balance sheet 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.


	September 30, 2015
in millions	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
SECURITIES AVAILABLE FOR SALE
States and political subdivisions	$	14	$	1		—	$	15
Collateralized mortgage obligations		11,938		127	$	62		12,003
Other mortgage-backed securities		2,309		22		1		2,330
Other securities		27		1		—		28

Total securities available for sale	$	14,288	$	151	$	63	$	14,376

HELD-TO-MATURITY SECURITIES
Collateralized mortgage obligations	$	4,299	$	24		23	$	4,300
Other mortgage-backed securities		617		3		—		620
Other securities		20		—		—		20

Total held-to-maturity securities	$	4,936	$	27	$	23	$	4,940


	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


	September 30, 2014
in millions	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
SECURITIES AVAILABLE FOR SALE
States and political subdivisions	$	26	$	1		—	$	27
Collateralized mortgage obligations		10,096		109	$	196		10,009
Other mortgage-backed securities		2,156		24		3		2,177
Other securities		28		4		—		32

Total securities available for sale	$	12,306	$	138	$	199	$	12,245

HELD-TO-MATURITY SECURITIES
Collateralized mortgage obligations	$	4,977	$	10	$	96	$	4,891
Other securities		20		—		—		20

Total held-to-maturity securities	$	4,997	$	10	$	96	$	4,911

The following table summarizes our securities that were in an unrealized loss position as of September 30, 2015, December 31, 2014, and September 30, 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
September 30, 2015
Securities available for sale:
Collateralized mortgage obligations	$	770	$	3	$	3,348	$	59	$	4,118	$	62
Other mortgage-backed securities		420		1		—		—		420		1
Other securities ^(a)		2		—		3		—		5		—
Held-to-maturity:
Collateralized mortgage obligations		214		1		1,355		22		1,569		23
Other mortgage-backed securities		110		—		—		—		110		—
Other securities ^(b)		4		—		—		—		4		—

Total temporarily impaired securities	$	1,520	$	5	$	4,706	$	81	$	6,226	$	86

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 ^(a)		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

September 30, 2014
Securities available for sale:
Collateralized mortgage obligations	$	605	$	7	$	4,379	$	189	$	4,984	$	196
Other mortgage-backed securities		811		1		81		2		892		3
Other securities ^(a)		1		—		2		—		3		—
Held-to-maturity:
Collateralized mortgage obligations		1,288		13		2,342		83		3,630		96

Total temporarily impaired securities	$	2,705	$	21	$	6,804	$	274	$	9,509	$	295

(a)	Gross unrealized losses totaled less than $1 million for other securities available for sale as of September 30, 2015, December 31, 2014, and September 30, 2014.

(b)	Gross unrealized losses totaled less than $1 million for other securities held-to-maturity as of September 30, 2015.

At September 30, 2015, we had $62 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 4.2 years at September 30, 2015. We also had $1 million of gross unrealized losses related to 17 other mortgage-backed securities positions, which had a weighted-average maturity of 5.2 years at September 30, 2015. Because 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 as other-than-temporarily impaired 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 did not have any impairment losses recognized in earnings for the three months ended September 30, 2015.


Three months ended September 30, 2015
in millions
Balance at June 30, 2015	$	4
Impairment recognized in earnings		—

Balance at September 30, 2015	$	4

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


Nine months ended September 30, 2015
in millions
Realized gains		—
Realized losses	$	1

Net securities gains (losses)	$	(1	)

At September 30, 2015, securities available for sale and held-to-maturity securities totaling $6.5 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
Available for Sale

Held-to-Maturity
Securities

September 30, 2015

in millions

Amortized
Cost

Fair
Value

Amortized
Cost

Fair
Value

Due in one year or less

297

302

Due after one through five years

12,659

12,735

4,310

4,311

Due after five through ten years

1,329

1,336

617

620

Due after ten years

—

Total

14,288

14,376

4,936

4,940