DERIVATIVE INSTRUMENTS (Tables)

3 Months Ended

Jan. 28, 2018

Fair Value Hedge Interest Rate Contracts and Underlying Borrowings

The gains (losses) on these contracts and the underlying borrowings recorded in interest expense follow in millions of dollars:


	Three Months Ended
	January 28		January 29
	2018		2017
Interest rate contracts *	$	(148)	$	(234)
Borrowings **		147		236

* Includes changes in fair values of interest rate contracts excluding net accrued interest income of $12 million and $26 million during the first quarter of 2018 and 2017, respectively.

** Includes adjustments for fair values of hedged borrowings excluding accrued interest expense of $63 million and $65 million during the first quarter of 2018 and 2017, respectively.

Fair Value of Derivative Instruments in Consolidated Balance Sheet

Fair values of derivative instruments in the condensed consolidated balance sheet in millions of dollars follow:


	January 28		October 29		January 29
Other Assets	2018		2017		2017
Designated as hedging instruments:
Interest rate contracts	$	39	$	74	$	116
Cross-currency interest rate contracts		4		5		10
Total designated		43		79		126

Not designated as hedging instruments:
Interest rate contracts		55		42		28
Foreign exchange contracts		31		108		21
Cross-currency interest rate contracts		4		6		14
Total not designated		90		156		63

Total derivative assets	$	133	$	235	$	189

Accounts Payable and Accrued Expenses
Designated as hedging instruments:
Interest rate contracts	$	223	$	112	$	85
Total designated		223		112		85

Not designated as hedging instruments:
Interest rate contracts		25		19		17
Foreign exchange contracts		124		26		68
Cross-currency interest rate contracts		2		1
Total not designated		151		46		85

Total derivative liabilities	$	374	$	158	$	170

Gains (Losses) Related to Derivative Instruments on Statement of Consolidated Income

The classification and gains (losses) including accrued interest expense related to derivative instruments on the statement of consolidated income consisted of the following in millions of dollars:


	Expense or	Three Months Ended
	OCI	January 28		January 29
	Classification	2018		2017
Fair Value Hedges:
Interest rate contracts	Interest	$	(136)	$	(208)

Cash Flow Hedges:
Recognized in OCI
(Effective Portion):
Interest rate contracts	OCI (pretax) *		8		3
Foreign exchange contracts	OCI (pretax) *				1

Reclassified from OCI
(Effective Portion):
Interest rate contracts	Interest *		**		**
Foreign exchange contracts	Other operating *				1

Recognized Directly in Income
(Ineffective Portion)			**		**

Not Designated as Hedges:
Interest rate contracts	Interest *	$	5	$	4
Foreign exchange contracts	Cost of sales		(48)		(40)
Foreign exchange contracts	Other operating *		(216)		(28)
Total not designated		$	(259)	$	(64)

* Includes interest and foreign exchange gains (losses) from cross-currency interest rate contracts.

** The amounts are not significant.

Impact on Derivative Assets and Liabilities Related to Netting Arrangements and Collateral

Derivatives are recorded without offsetting for netting arrangements or collateral. The impact on the derivative assets and liabilities related to netting arrangements and any collateral received or paid in millions of dollars follows:


	Gross Amounts		Netting		Collateral
January 28, 2018	Recognized		Arrangements		Received	Net Amount
Assets	$	133	$	(70)		$	63
Liabilities		374		(70)			304


	Gross Amounts		Netting		Collateral
October 29, 2017	Recognized		Arrangements		Received	Net Amount
Assets	$	235	$	(65)		$	170
Liabilities		158		(65)			93


	Gross Amounts		Netting		Collateral
January 29, 2017	Recognized		Arrangements		Received	Net Amount
Assets	$	189	$	(46)		$	143
Liabilities		170		(46)			124