Quarterly report pursuant to Section 13 or 15(d)

Fair Value Option (Tables)

v3.21.1
Fair Value Option (Tables)
 3 Months Ended
Mar. 31, 2021
Fair Value Disclosures [Abstract]  
Schedule of Fair Value Option Elections The following tables provide information about the fair value carrying amount and the contractual principal outstanding of assets and liabilities accounted for under the fair value option at March 31, 2021 and December 31, 2020, and information about where changes in the fair value of assets and liabilities accounted for under the fair value option are included in the Consolidated Statement of Income for the three months ended March 31, 2021 and 2020.
Fair Value Option Elections
March 31, 2021 December 31, 2020
(Dollars in millions)
 Fair Value
 Carrying
 Amount		 Contractual Principal Outstanding Fair Value Carrying Amount Less Unpaid Principal Fair Value
Carrying
Amount		 Contractual Principal Outstanding Fair Value Carrying Amount
Less Unpaid Principal
Federal funds sold and securities borrowed or purchased under agreements to resell
 $ 153,387  $ 153,358  $ 29  $ 108,856  $ 108,811  $ 45 
Loans reported as trading account assets (1)
8,213  16,630  (8,417) 7,967  17,372  (9,405)
Trading inventory – other 21,710  n/a n/a 22,790  n/a n/a
Consumer and commercial loans 7,003  7,059  (56) 6,681  6,778  (97)
Loans held-for-sale (1)
1,680  2,571  (891) 1,585  2,521  (936)
Other assets 172  n/a n/a 200  n/a n/a
Long-term deposits 504  488  16  481  448  33 
Federal funds purchased and securities loaned or sold under agreements to repurchase
 154,865  154,873  (8) 135,391  135,390  1 
Short-term borrowings 4,503  4,286  217  5,874  5,178  696 
Unfunded loan commitments 91  n/a n/a 99  n/a n/a
Long-term debt 30,514  31,683  (1,169) 32,200  33,470  (1,270)
(1)A significant portion of the loans reported as trading account assets and LHFS are distressed loans that were purchased at a deep discount to par, and the remainder are loans with a fair value near contractual principal outstanding.
n/a = not applicable
Gains (Losses) Relating to Assets and Liabilities Accounted for Under the Fair Value Option
Three Months Ended March 31
2021 2020
(Dollars in millions) Market making and similar activities Other
Income		 Total Market making and similar activities Other
Income		 Total
Loans reported as trading account assets $ 112  $ —  $ 112  $ (387) $ —  $ (387)
Trading inventory – other (1)
(730) —  (730) (2,793) —  (2,793)
Consumer and commercial loans 71  19  90  (83) (358) (441)
Short-term borrowings 413  —  413  517  —  517 
Unfunded loan commitments —  5  5  —  (116) (116)
Long-term debt (2)
386  (16) 370  916  (16) 900 
Other (3)
12  10  22  13  (51) (38)
Total $ 264  $ 18  $ 282  $ (1,817) $ (541) $ (2,358)
(1)    The gains (losses) in market making and similar activities are primarily offset by (losses) gains on trading liabilities that hedge these assets.
(2)    The net gains in market making and similar activities relate to the embedded derivatives in structured liabilities and are typically offset by losses on derivatives and securities that hedge these liabilities. For the cumulative impact of changes in the Corporation’s own credit spreads and the amount recognized in accumulated OCI, see Note 12 – Accumulated Other Comprehensive Income (Loss). For more information on how the Corporation’s own credit spread is determined, see Note 20 – Fair Value Measurements to the Consolidated Financial Statements of the Corporation’s 2020 Annual Report on Form 10-K.
(3)    Includes gains (losses) on federal funds sold and securities borrowed or purchased under agreements to resell, LHFS, long-term deposits and federal funds purchased and securities loaned or sold under agreements to repurchase.
Gains (Losses) Related to Borrower-specific Credit Risk for Assets and Liabilities Accounted for Under the Fair Value Option
Three Months Ended March 31
(Dollars in millions) 2021 2020
Loans reported as trading account assets $ 66  $ (389)
Consumer and commercial loans 13  (349)
Loans held-for-sale (6) (74)
Unfunded loan commitments 5  (116)