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Investment Securities | 12 Months Ended
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Dec. 31, 2015
Disclosure Text Block Abstract |
Investment Securities | NOTE 5 Investment Securities Investment securities principally include debt securities that the Company classifies as available-for-sale and carries at fair value on the Consolidated Balance Sheets, with unrealized gains (losses) recorded in Accumulated Other Comprehensive Loss, net of income taxes. Realized gains and losses are recognized on a trade-date basis in results of operations upon disposition of the securities using the specific identification method. Refer to Note 15 and Note 19 for a description of the Company’s methodology for determining the fair value of investment securities and gross realized gains on the sale of investment securities, respectively. The following is a summary of investment securities as of December 31:
|  | 2015 |  | 2014
|  |  |  |  | Gross |  | Gross |  | Estimated |  |  |  |  | Gross |  | Gross |  | Estimated
|  |  |  | Unrealized | Unrealized |  | Fair |  |  | Unrealized | Unrealized |  | Fair
Description of Securities (Millions) |  |  | Cost | Gains | Losses |  | Value |  | Cost | Gains | Losses |  | Value
State and municipal obligations |  | $ | 2,813 |  | $ | 85 |  | $ | (5) |  | $ | 2,893 |  | $ | 3,366 |  | $ | 129 |  | $ | (2) |  | $ | 3,493
U.S. Government agency obligations |  |  | 2 |  |  | ― |  |  | ― |  |  | 2 |  |  | 3 |  |  | ― |  |  | ― |  |  | 3
U.S. Government treasury obligations |  |  | 406 |  |  | 4 |  |  | (1) |  |  | 409 |  |  | 346 |  |  | 4 |  |  | ― |  |  | 350
Corporate debt securities |  |  | 29 |  |  | 1 |  |  | ― |  |  | 30 |  |  | 37 |  |  | 3 |  |  | ― |  |  | 40
Mortgage-backed securities (a) |  |  | 117 |  |  | 4 |  |  | ― |  |  | 121 |  |  | 128 |  |  | 8 |  |  | ― |  |  | 136
Equity securities (b) |  |  | 1 |  |  | ― |  |  | ― |  |  | 1 |  |  | ― |  |  | 1 |  |  | ― |  |  | 1
Foreign government bonds and obligations |  |  | 250 |  |  | 6 |  |  | (1) |  |  | 255 |  |  | 350 |  |  | 9 |  |  | ― |  |  | 359
Other (c) |  |  | 50 |  |  | ― |  |  | (2) |  |  | 48 |  |  | 50 |  |  | ― |  |  | (1) |  |  | 49
Total |  | $ | 3,668 |  | $ | 100 |  | $ | (9) |  | $ | 3,759 |  | $ | 4,280 |  | $ | 154 |  | $ | (3) |  | $ | 4,431
Represents mortgage-backed securities guaranteed by Fannie Mae, Freddie Mac or Ginnie Mae. 2013 amount primarily represents the Company’s investment in the Industrial and Commercial Bank of China (ICBC), the remaining amount of which was sold in the third quarter of 2014. Other comprises investments in various mutual funds. The following table provides information about the Company’s investment securities with gross unrealized losses and the length of time that individual securities have been in a continuous unrealized loss position, as of December 31:
|  |  |  | 2015 |  | 2014
|  | Less than 12 months |  | 12 months or more |  | Less than 12 months |  | 12 months or more
|  |  |  |  |  |  | Gross |  |  |  |  |  | Gross |  |  |  |  | Gross |  |  |  |  | Gross
|  |  |  | Estimated | Unrealized | Estimated | Unrealized |  | Estimated | Unrealized | Estimated | Unrealized
Description of Securities (Millions) |  | Fair Value | Losses | Fair Value | Losses |  | Fair Value | Losses | Fair Value | Losses
State and municipal obligations |  | $ | 100 |  | $ | (3) |  | $ | 13 |  | $ | (2) |  | $ | ― |  | $ | ― |  | $ | 72 |  | $ | (2)
U.S. Government treasury obligations |  |  | 253 |  |  | (1) |  |  | ― |  |  | ― |  |  | ― |  |  | ― |  |  | ― |  |  | ―
Foreign government bonds and obligations |  |  | 99 |  |  | (1) |  |  | ― |  |  | ― |  |  | ― |  |  | ― |  |  | ― |  |  | ―
Other |  |  | ― |  |  | ― |  |  | 33 |  |  | (2) |  |  | ― |  |  | ― |  |  | 33 |  |  | (1)
Total |  | $ | 452 |  | $ | (5) |  | $ | 46 |  | $ | (4) |  | $ | ― |  | $ | ― |  | $ | 105 |  | $ | (3)
The following table summarizes the gross unrealized losses due to temporary impairments by ratio of fair value to amortized cost, as of December 31:
|  | Less than 12 months |  | 12 months or more |  | Total
|  |  |  |  |  | Gross |  |  |  |  |  |  | Gross |  |  |  |  |  |  | Gross
Ratio of Fair Value to |  | Number of | Estimated | Unrealized |  | Number of | Estimated | Unrealized |  | Number of | Estimated | Unrealized
Amortized Cost (Dollars in millions) |  | Securities | Fair Value | Losses |  | Securities | Fair Value | Losses |  | Securities | Fair Value | Losses
2015: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
90%–100% |  | 52 |  | $ | 450 |  | $ | (5) |  | 15 |  | $ | 37 |  | $ | (2) |  | 67 |  | $ | 487 |  | $ | (7)
Less than 90% |  | ― |  |  | ― |  |  | ― |  | 2 |  |  | 9 |  |  | (2) |  | 2 |  |  | 9 |  |  | (2)
Total as of December 31, 2015 |  | 52 |  | $ | 450 |  | $ | (5) |  | 17 |  | $ | 46 |  | $ | (4) |  | 69 |  | $ | 496 |  | $ | (9)
2014: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
90%–100% |  | ― |  | $ | ― |  | $ | ― |  | 15 |  | $ | 105 |  | $ | (3) |  | 15 |  | $ | 105 |  | $ | (3)
Total as of December 31, 2014 |  | ― |  | $ | ― |  | $ | ― |  | 15 |  | $ | 105 |  | $ | (3) |  | 15 |  | $ | 105 |  | $ | (3)
The gross unrealized losses are attributed to overall wider credit spreads for state and municipal securities, wider credit spreads for specific issuers, adverse changes in market benchmark interest rates, or a combination thereof, all compared to those prevailing when the investment securities were acquired. Overall, for the investment securities in gross unrealized loss positions, (i) the Company does not intend to sell the investment s ecurities, (ii) it is more likely than not that the Company w ill not be required to sell the investment securities before recovery of the unrealized losses, and (iii) the Company expects that the contractual principal and interest will be received on the investment securities. As a result, the Company recognized no o ther-than-temporary impairment during the periods presented. Weighted average yields and contractual maturities for investment securities with stated maturities as of December 31, 2015 were as follows:
|  |  |  |  |  | Due after 1 |  | Due after 5 |  |  |  |  |
|  |  | Due within | year but |  | years but |  | Due after |  |  |
(Millions) |  | 1 year |  | within 5 years |  | within 10 years |  | 10 years |  |  | Total
State and municipal obligations(a) |  | $ | 23 |  | $ | 61 |  | $ | 277 |  | $ | 2,532 |  | $ | 2,893
U.S. Government agency obligations |  |  | ― |  |  | ― |  |  | ― |  |  | 2 |  |  | 2
U.S. Government treasury obligations |  |  | 120 |  |  | 144 |  |  | 132 |  |  | 13 |  |  | 409
Corporate debt securities |  |  | 6 |  |  | 24 |  |  | ― |  |  | ― |  |  | 30
Mortgage-backed securities(a) |  |  | 1 |  |  | ― |  |  | ― |  |  | 120 |  |  | 121
Foreign government bonds and obligations |  |  | 190 |  |  | 23 |  |  | ― |  |  | 42 |  |  | 255
Total Estimated Fair Value |  | $ | 340 |  | $ | 252 |  | $ | 409 |  | $ | 2,709 |  | $ | 3,710
Total Cost |  | $ | 340 |  | $ | 247 |  | $ | 395 |  | $ | 2,635 |  | $ | 3,617
Weighted average yields(b) |  |  | 2.86 | % |  | 2.78 | % |  | 5.48 | % |  | 6.58 | % |  | 5.85%
The expected payments on state and municipal obligations and mortgage-backed securities may not coincide with their contractual maturities because the issuers have the right to call or prepay certain obligations. Average yields for investment securities have been calculated using the effective yield on the date of purchase. Yields on tax-exempt investment securities have been computed on a tax-equivalent basis using the U.S. federal statutory tax rate of 35 percent.

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