Quarterly report pursuant to Section 13 or 15(d)

Federal Funds Sold or Purchased, Securities Financing Agreements and Short-term Borrowings

v2.4.0.8
Federal Funds Sold or Purchased, Securities Financing Agreements and Short-term Borrowings
 9 Months Ended
Sep. 30, 2013
Debt Disclosure [Abstract]  
Federal Funds Sold or Purchased, Securities Financing Agreements and Short-term Borrowings
NOTE 10 – Federal Funds Sold or Purchased, Securities Financing Agreements and Short-term Borrowings

The table below presents federal funds sold or purchased, securities financing agreements which include securities borrowed or purchased under agreements to resell and securities loaned or sold under agreements to repurchase, and short-term borrowings.

 
Three Months Ended September 30
 
Nine Months Ended September 30
 
Amount
 
Rate
 
Amount
 
Rate
(Dollars in millions)
2013
 
2012
 
2013
 
2012
 
2013
 
2012
 
2013
 
2012
Average during period
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Federal funds sold
$
10

 
$
519

 
0.74
%
 
0.36
%
 
$
8

 
$
281

 
0.68
%
 
0.44
%
Securities borrowed or purchased under agreements to resell
223,424

 
234,436

 
0.52

 
0.60

 
231,371

 
233,777

 
0.53

 
0.67

Total
$
223,434

 
$
234,955

 
0.52

 
0.60

 
$
231,379

 
$
234,058

 
0.53

 
0.67

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Federal funds purchased
$
183

 
$
211

 
0.03
%
 
0.05
%
 
$
188

 
$
229

 
0.06
%
 
0.05
%
Securities loaned or sold under agreements to repurchase
235,022

 
286,931

 
0.82

 
0.95

 
268,549

 
274,166

 
0.80

 
1.04

Short-term borrowings
44,220

 
37,881

 
1.76

 
2.16

 
42,749

 
37,981

 
2.01

 
2.07

Total
$
279,425

 
$
325,023

 
0.97

 
1.09

 
$
311,486

 
$
312,376

 
0.96

 
1.16

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Maximum month-end balance during period
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Federal funds sold
$
35

 
$
550

 
 
 
 
 
$
550

 
$
550

 
 
 
 
Securities borrowed or purchased under agreements to resell
220,985

 
237,630

 
 
 
 
 
249,791

 
252,303

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Federal funds purchased
$
166

 
$
207

 
 
 
 
 
$
1,271

 
$
331

 
 
 
 
Securities loaned or sold under agreements to repurchase
239,556

 
291,093

 
 
 
 
 
319,608

 
291,093

 
 
 
 
Short-term borrowings
44,291

 
40,129

 
 
 
 
 
46,470

 
40,129

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
September 30, 2013
 
 
 
 
 
December 31, 2012
 
 
 
 
 
Amount
 
Rate
 
 
 
 
 
Amount
 
Rate
 
 
 
 
Period-end balance
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Federal funds sold
$
—

 
—
%
 
 
 
 
 
$
600

 
0.54
%
 
 
 
 
Securities borrowed or purchased under agreements to resell
212,007

 
0.50

 
 
 
 
 
219,324

 
0.92

 
 
 
 
Total
$
212,007

 
0.50

 
 
 
 
 
$
219,924

 
0.92

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Federal funds purchased
$
151

 
0.10
%
 
 
 
 
 
$
1,151

 
0.17
%
 
 
 
 
Securities loaned or sold under agreements to repurchase
226,123

 
0.85

 
 
 
 
 
292,108

 
1.11

 
 
 
 
Short-term borrowings
40,769

 
1.86

 
 
 
 
 
30,731

 
3.08

 
 
 
 
Total
$
267,043

 
1.00

 
 
 
 
 
$
323,990

 
1.29

 
 
 
 


Offsetting of Securities Financing Agreements

Substantially all of repurchase and resale activities are transacted under legally enforceable master repurchase agreements that give the Corporation, in the event of default by the counterparty, the right to liquidate securities held and to offset receivables and payables with the same counterparty. The Corporation offsets repurchase and resale transactions with the same counterparty on the Consolidated Balance Sheet where it has such a legally enforceable master netting agreement and the transactions have the same maturity date.

Substantially all securities borrowing and lending activities are transacted under legally enforceable master securities lending agreements that give the Corporation, in the event of default by the counterparty, the right to liquidate securities held and to offset receivables and payables with the same counterparty. The Corporation offsets securities borrowing and lending transactions with the same counterparty on the Consolidated Balance Sheet where it has such a legally enforceable master netting agreement and the transactions have the same maturity date.

The table below presents securities financing agreements included on the Consolidated Balance Sheet in federal funds sold and securities borrowed or purchased under agreements to resell, and in federal funds purchased and securities loaned or sold under agreements to repurchase at September 30, 2013 and December 31, 2012. Balances are presented on a gross basis, prior to the application of counterparty netting. Gross assets and liabilities are adjusted on an aggregate basis to take into consideration the effects of legally enforceable master netting agreements. For more information on the offsetting of derivatives, see Note 3 – Derivatives.

The "other" amount in the table below relates to transactions where the Corporation acts as the lender in a securities lending agreement and receives securities that can be pledged or sold as collateral. In these transactions, the Corporation recognizes an asset at fair value, representing the securities received, and a liability for the same amount, representing the obligation to return those securities. The "other" amount is included on the Consolidated Balance Sheet in other assets and in accrued expenses and other liabilities.

The column titled "Financial Instruments" in the table below includes securities collateral received or pledged under repurchase or securities lending agreements where there is a legally enforceable master netting agreement. These amounts are not offset on the Consolidated Balance Sheet, but are shown as a reduction to the net balance sheet amount in the table to derive a net asset or liability. Securities collateral received or pledged where the legal enforceability of the master netting agreements is not certain is not included.

Gross assets and liabilities include activity where uncertainty exists as to the enforceability of certain master netting agreements under bankruptcy laws in some countries or industries, and accordingly, these are reported on a gross basis.

Securities Financing Agreements
 
September 30, 2013
(Dollars in millions)
Gross Assets/Liabilities
 
Amounts Offset
 
Net Balance Sheet Amount
 
Financial Instruments
 
Net Assets/Liabilities
Securities borrowed or purchased under agreements to resell
$
315,751

 
$
(103,744
)
 
$
212,007

 
$
(171,277
)
 
$
40,730

 
 
 
 
 
 
 
 
 
 
Securities loaned or sold under agreements to repurchase
$
329,867

 
$
(103,744
)
 
$
226,123

 
$
(180,918
)
 
$
45,205

Other
9,180

 
—

 
9,180

 
(9,180
)
 
—

Total
$
339,047

 
$
(103,744
)
 
$
235,303

 
$
(190,098
)
 
$
45,205

 
 
 
 
 
 
 
 
 
 
 
December 31, 2012
Securities borrowed or purchased under agreements to resell
$
366,238

 
$
(146,914
)
 
$
219,324

 
$
(173,593
)
 
$
45,731

 
 
 
 
 
 
 
 
 
 
Securities loaned or sold under agreements to repurchase
$
439,022

 
$
(146,914
)
 
$
292,108

 
$
(217,817
)
 
$
74,291

Other
12,306

 
—

 
12,306

 
(12,302
)
 
4

Total
$
451,328

 
$
(146,914
)
 
$
304,414

 
$
(230,119
)
 
$
74,295