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Fair Value Measurements | 6 Months Ended
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Jun. 30, 2022
Fair Value Disclosures [Abstract] |
Fair Value Measurements | Note 12 – Fair Value Measurements Certain of the Company’s assets and liabilities are carried at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company categorizes its assets and liabilities carried at fair value using a three-level hierarchy for fair value measurements that distinguishes between market participant assumptions developed based on market data obtained from sources independent of the Company (observable inputs) and the Company’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The hierarchy for inputs used in determining fair value maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. The hierarchy level assigned to the assets and liabilities is based on management’s assessment of the transparency and reliability of the inputs used to estimate the fair values at the measurement date. The three hierarchy levels are defined as follows: Level 1—Valuations based on unadjusted quoted market prices in active markets for identical assets or liabilities. Level 2—Valuations based on observable inputs (other than Level 1 prices), such as quoted prices for similar assets or liabilities at the measurement date; quoted prices in markets that are not active; or other inputs that are observable, either directly or indirectly. Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement and involve management judgment. If the inputs used to measure fair value fall into different levels of the fair value hierarchy, the hierarchy level assigned is based upon the lowest level of input that is significant to the fair value measurement. The following tables present the fair values of the Company’s assets and liabilities, measured on a recurring basis, as of June 30, 2022 and December 31, 2021:
(in millions) |  | Total |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
June 30, 2022 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Debt securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury bonds |  | $ | 147 |  |  | $ | — |  |  | $ | 147 |  |  | $ | — |
Municipal bonds |  |  | 1,462 |  |  |  | — |  |  |  | 1,462 |  |  |  | — |
Foreign government bonds |  |  | 200 |  |  |  | — |  |  |  | 200 |  |  |  | — |
Governmental agency bonds |  |  | 129 |  |  |  | — |  |  |  | 129 |  |  |  | — |
Governmental agency mortgage-backed securities |  |  | 5,050 |  |  |  | — |  |  |  | 5,050 |  |  |  | — |
U.S. corporate debt securities |  |  | 1,003 |  |  |  | — |  |  |  | 1,003 |  |  |  | — |
Foreign corporate debt securities |  |  | 459 |  |  |  | — |  |  |  | 459 |  |  |  | — |
|  |  | 8,450 |  |  |  | — |  |  |  | 8,450 |  |  |  | — |
Equity securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Preferred stocks |  |  | 14 |  |  |  | 14 |  |  |  | — |  |  |  | — |
Common stocks |  |  | 378 |  |  |  | 378 |  |  |  | — |  |  |  | — |
|  |  | 392 |  |  |  | 392 |  |  |  | — |  |  |  | — |
Servicing related assets |  |  | 21 |  |  |  | — |  |  |  | 1 |  |  |  | 20 |
Total assets |  | $ | 8,863 |  |  | $ | 392 |  |  | $ | 8,451 |  |  | $ | 20 |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Servicing related liabilities |  | $ | 12 |  |  | $ | — |  |  | $ | — |  |  | $ | 12 |
(in millions) |  | Total |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
December 31, 2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Debt securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury bonds |  | $ | 123 |  |  | $ | — |  |  | $ | 123 |  |  | $ | — |
Municipal bonds |  |  | 1,649 |  |  |  | — |  |  |  | 1,649 |  |  |  | — |
Foreign government bonds |  |  | 227 |  |  |  | — |  |  |  | 227 |  |  |  | — |
Governmental agency bonds |  |  | 177 |  |  |  | — |  |  |  | 177 |  |  |  | — |
Governmental agency mortgage-backed securities |  |  | 5,607 |  |  |  | — |  |  |  | 5,607 |  |  |  | — |
U.S. corporate debt securities |  |  | 1,081 |  |  |  | — |  |  |  | 1,081 |  |  |  | — |
Foreign corporate debt securities |  |  | 498 |  |  |  | — |  |  |  | 498 |  |  |  | — |
|  |  | 9,362 |  |  |  | — |  |  |  | 9,362 |  |  |  | — |
Equity securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Preferred stocks |  |  | 17 |  |  |  | 17 |  |  |  | — |  |  |  | — |
Common stocks |  |  | 640 |  |  |  | 640 |  |  |  | — |  |  |  | — |
|  |  | 657 |  |  |  | 657 |  |  |  | — |  |  |  | — |
Servicing related assets |  |  | 27 |  |  |  | — |  |  |  | 11 |  |  |  | 16 |
Total assets |  | $ | 10,046 |  |  | $ | 657 |  |  | $ | 9,373 |  |  | $ | 16 |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Servicing related liabilities |  | $ | 9 |  |  | $ | — |  |  | $ | — |  |  | $ | 9 |
The following table presents the carrying amounts and estimated fair values of the Company’s financial instruments not measured at fair value as of June 30, 2022 and December 31, 2021:
|  | Carrying |  | Estimated fair value |
(in millions) |  | Amount |  | Total |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
June 30, 2022 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  | $ | 1,745 |  | $ | 1,745 |  |  | $ | 1,745 |  |  | $ | — |  |  | $ | — |
Deposits with banks |  | $ | 67 |  | $ | 67 |  |  | $ | 21 |  |  | $ | 46 |  |  | $ | — |
Notes receivable, net |  | $ | 11 |  | $ | 10 |  |  | $ | — |  |  | $ | — |  |  | $ | 10 |
Secured financings receivable |  | $ | 505 |  | $ | 505 |  |  | $ | — |  |  | $ | 505 |  |  | $ | — |
Loans eligible for repurchase |  | $ | 28 |  | $ | 28 |  |  | $ | — |  |  | $ | 28 |  |  | $ | — |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Secured financings payable (1) |  | $ | 417 |  | $ | 417 |  |  | $ | — |  |  | $ | 417 |  |  | $ | — |
Liability for loans eligible for repurchase |  | $ | 28 |  | $ | 28 |  |  | $ |  |  |  | $ | 28 |  |  | $ | — |
Notes and contracts payable |  | $ | 1,646 |  | $ | 1,464 |  |  | $ | — |  |  | $ | 1,461 |  |  | $ | 3 |
(1) | Excludes servicing related liabilities, which are measured at fair value on a recurring basis.
|  | Carrying |  | Estimated fair value |
(in millions) |  | Amount |  | Total |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
December 31, 2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  | $ | 1,228 |  | $ | 1,228 |  |  | $ | 1,228 |  |  | $ | — |  |  | $ | — |
Deposits with banks |  | $ | 58 |  | $ | 58 |  |  | $ | 13 |  |  | $ | 45 |  |  | $ | — |
Notes receivable, net |  | $ | 32 |  | $ | 32 |  |  | $ | — |  |  | $ | — |  |  | $ | 32 |
Secured financings receivable |  | $ | 565 |  | $ | 565 |  |  | $ | — |  |  | $ | 565 |  |  | $ | — |
Loans eligible for repurchase |  | $ | 47 |  | $ | 47 |  |  | $ | — |  |  | $ | 47 |  |  | $ | — |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Secured financings payable (1) |  | $ | 529 |  | $ | 529 |  |  | $ | — |  |  | $ | 529 |  |  | $ | — |
Liability for loans eligible for repurchase |  | $ | 47 |  | $ | 47 |  |  | $ |  |  |  | $ | 47 |  |  | $ | — |
Notes and contracts payable |  | $ | 1,648 |  | $ | 1,724 |  |  | $ | — |  |  | $ | 1,720 |  |  | $ | 4 |
(1) | Excludes servicing related liabilities, which are measured at fair value on a recurring basis.

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- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI https://asc.fasb.org/extlink&oid=126976982&loc=d3e19207-110258 + Details
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