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Share-Based Compensation Plans
 3 Months Ended
Mar. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Share-Based Compensation Plans
Share-Based Compensation Plans
The Company has share-based compensation plans under which the Company grants restricted stock units (RSUs) and performance share units (PSUs) to certain management level employees. In addition, employees and non-employee directors may be granted options to purchase shares of Company common stock at the fair market value at the time of grant.
The following table provides the amounts of share-based compensation cost recorded in the Condensed Consolidated Statement of Income:
 
Three Months Ended 
 March 31,
($ in millions)
2017
 
2016
Pretax share-based compensation expense
$
74

 
$
68

Income tax benefit
(22
)
 
(20
)
Total share-based compensation expense, net of taxes
$
52

 
$
48


During the first three months of 2017 and 2016, the Company granted 86 thousand RSUs with a weighted-average grant date fair value of $64.20 per RSU and 133 thousand RSUs with a weighted-average grant date fair value of $48.83 per RSU, respectively. During the first three months of 2017 and 2016, the Company granted 190 thousand stock options with a weighted-average exercise price of $64.20 per option and 74 thousand stock options with a weighted-average exercise price of $48.83 per option, respectively. The weighted-average fair value of options granted for the first three months of 2017 and 2016 was $7.89 and $5.76 per option, respectively, and was determined using the following assumptions:
  
Three Months Ended March 31,
 
2017
 
2016
Expected dividend yield
3.7
%
 
3.8
%
Risk-free interest rate
2.0
%
 
1.3
%
Expected volatility
19.7
%
 
21.0
%
Expected life (years)
6.2

 
6.2


At March 31, 2017, there was $681 million of total pretax unrecognized compensation expense related to nonvested stock options, RSU and PSU awards which will be recognized over a weighted-average period of 2.4 years. The Company typically communicates the value of annual share-based compensation awards to employees during the first quarter, but the related share amounts are not established and communicated until early May. Therefore, while the number of RSU and stock option grants disclosed above do not reflect any amounts relating to the annual grants, share-based compensation costs for the first quarter of 2017 and 2016 and unrecognized compensation expense at March 31, 2017 reflect an impact relating to the awards communicated to employees. For segment reporting, share-based compensation costs are unallocated expenses.