x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Massachusetts
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04-2456637
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(State or other jurisdiction
of incorporation or organization)
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(I.R.S. Employer Identification No.)
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One Lincoln Street
Boston, Massachusetts
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02111
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(Address of principal executive office)
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(Zip Code)
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Large accelerated filer
x
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Accelerated filer
¨
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Non-accelerated filer
¨
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Smaller reporting company
¨
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(Do not check if a smaller reporting company)
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PART I. FINANCIAL INFORMATION
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PART II. OTHER INFORMATION
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•
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the financial strength and continuing viability of the counterparties with which we or our clients do business and to which we have investment, credit or financial exposure, including, for example, the direct and indirect effects on counterparties to the current sovereign debt risks in Europe and other regions;
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•
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financial market disruptions or economic recession, whether in the U.S., Europe or other regions internationally;
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•
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increases in the volatility of, or declines in the level of, our net interest revenue, changes in the composition of the assets recorded in our consolidated statement of condition and the possibility that we may be required to change the manner in which we fund those assets;
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•
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the liquidity of the U.S. and international securities markets, particularly the markets for fixed-income securities and inter-bank credits, and the liquidity requirements of our clients;
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•
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the level and volatility of interest rates and the performance and volatility of securities, credit, currency and other markets in the U.S. and internationally;
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•
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the credit quality, credit agency ratings, and fair values of the securities in our investment securities portfolio, a deterioration or downgrade of which could lead to other-than-temporary impairment of the respective securities and the recognition of an impairment loss in our consolidated statement of income;
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•
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our ability to attract deposits and other low-cost, short-term funding, and our ability to deploy deposits in a profitable manner consistent with our liquidity requirements and risk profile;
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•
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the manner in which the Federal Reserve and other regulators implement the Dodd-Frank Act, Basel III, European legislation with respect to banking and financial activities and other regulatory initiatives in the U.S. and internationally, including regulatory developments that result in changes to our structure or operating model, increased costs or other changes to the provision of our services;
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•
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adverse changes in required regulatory capital ratios, whether arising under the Dodd-Frank Act, Basel II or Basel III, or due to changes in regulatory positions or regulations in jurisdictions in which we engage in banking activities;
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•
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increasing requirements to obtain necessary approvals of the Federal Reserve and our other regulators for the use, allocation or distribution of our capital or for other specific capital actions or programs, including acquisitions, dividends and equity repurchases, without which our growth plans, distributions to shareholders, equity purchase programs or other capital initiatives may be restricted;
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•
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changes in law or regulation that may adversely affect our, our clients' or our counterparties' business activities and the products or services that we sell, including additional or increased taxes or assessments thereon, capital adequacy requirements and changes that expose us to risks related to compliance;
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•
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the maintenance of credit agency ratings for our debt and depository obligations as well as the level of credibility of credit agency ratings;
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•
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delays or difficulties in the execution of our previously announced Business Operations and Information Technology Transformation program, which could lead to changes in our estimates of the charges, expenses or savings associated with the planned program, resulting in increased volatility of our earnings;
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•
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the results of, and costs associated with, government investigations, litigation, and similar claims, disputes, or proceedings;
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•
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the possibility that our clients will incur substantial losses in investment pools for which we act as agent, and the possibility of significant reductions in the valuation of assets;
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•
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adverse publicity or other reputational harm;
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•
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dependencies on information technology, complexities and costs of protecting the security of our systems and difficulties with protecting our intellectual property rights;
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•
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our ability to grow revenue, attract and/or retain and compensate highly skilled people, control expenses and attract the capital necessary to achieve our business goals and comply with regulatory requirements;
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•
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potential changes to the competitive environment, including changes due to regulatory and technological changes, the effects of consolidation, and perceptions of State Street as a suitable service provider or counterparty;
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•
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potential changes in how clients compensate us for our services, and the mix of services that clients choose from us;
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•
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the risks that acquired businesses and joint ventures will not achieve their anticipated financial and operational benefits or will not be integrated successfully, or that the integration will take longer than anticipated, that expected synergies will not be achieved or unexpected disynergies will be experienced, that client and deposit retention goals will not be met, that other regulatory or operational challenges will be experienced and that disruptions from the transaction will harm relationships with clients, employees or regulators;
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•
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the ability to complete acquisitions, divestitures and joint ventures, including the ability to obtain regulatory approvals, the ability to arrange financing as required and the ability to satisfy closing conditions;
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•
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our ability to recognize emerging needs of clients and to develop products that are responsive to such trends and profitable to the company; the performance of and demand for the products and services we offer, including the level and timing of redemptions and withdrawals from our collateral pools and other collective investment products; and the potential for new products and services to impose additional costs on us and expose us to increased operational risk;
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•
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our ability to measure the fair value of the investment securities recorded in our consolidated statement of condition;
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•
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our ability to control operating risks, data security breach risks, information technology systems risks and outsourcing risks, and our ability to protect our intellectual property rights, the possibility of errors in the quantitative models we use to manage our business and the possibility that our controls will prove insufficient, fail or be circumvented;
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•
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changes in accounting standards and practices; and
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•
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changes in tax legislation and in the interpretation of existing tax laws by U.S. and non-U.S. tax authorities that affect the amount of taxes due.
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Quarters Ended September 30,
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Nine Months Ended September 30,
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||||||||||||||||||
(Dollars in millions, except per share amounts)
|
2012
|
|
2011
|
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% Change
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|
2012
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|
2011
|
|
% Change
|
||||||||||
Total fee revenue
|
$
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1,719
|
|
|
$
|
1,844
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|
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(7
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)%
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$
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5,282
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|
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$
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5,527
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(4
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)%
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Net interest revenue
|
619
|
|
|
578
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|
7
|
|
|
1,916
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|
1,727
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11
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|
||||
Gains related to investment securities, net
|
18
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|
5
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|
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2
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25
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|
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||||||
Total revenue
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2,356
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|
|
2,427
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(3
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)
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|
7,200
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7,279
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(1
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)
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||||
Provision for loan losses
|
—
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—
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(1
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)
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|
1
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|
|
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||||||
Expenses:
|
|
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||||||||||
Expenses from operations
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1,664
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1,713
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(3
|
)
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5,191
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|
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5,153
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|
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1
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|
||||
Claims resolution
(1)
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(362
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)
|
|
—
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(362
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)
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—
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|
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||||||
Provisions for litigation exposure and other costs
(2)
|
85
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|
|
—
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|
|
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|
107
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|
|
—
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|
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||||||
Acquisition costs
|
13
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|
|
19
|
|
|
|
|
41
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|
|
46
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|
|
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||||||
Restructuring charges
|
15
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|
|
66
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|
|
|
|
45
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|
|
75
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|
|
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||||||
Total expenses
|
1,415
|
|
|
1,798
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|
(21
|
)
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|
5,022
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5,274
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|
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(5
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)
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||||
Income before income tax expense
|
941
|
|
|
629
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|
|
50
|
|
|
2,179
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|
|
2,004
|
|
|
9
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|
||||
Income tax expense
|
267
|
|
|
74
|
|
|
|
|
588
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|
|
465
|
|
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||||||
Net income
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$
|
674
|
|
|
$
|
555
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|
|
21
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|
|
$
|
1,591
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|
|
$
|
1,539
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|
3
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|
Adjustments to net income:
|
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|
|
|
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|
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||||||||||
Dividends on preferred stock
(3)
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$
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(15
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)
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$
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(6
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)
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|
|
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$
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(29
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)
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|
$
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(13
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)
|
|
|
||
Earnings allocated to participating securities
(4)
|
(5
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)
|
|
(6
|
)
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|
|
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(11
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)
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|
(15
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)
|
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|
||||||
Net income available to common shareholders
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$
|
654
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|
|
$
|
543
|
|
|
|
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$
|
1,551
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|
|
$
|
1,511
|
|
|
|
||
Earnings per common share:
|
|
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||||||||||
Basic
|
$
|
1.39
|
|
|
$
|
1.11
|
|
|
|
|
$
|
3.23
|
|
|
$
|
3.05
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|
|
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||
Diluted
|
1.36
|
|
|
1.10
|
|
|
24
|
|
|
3.19
|
|
|
3.03
|
|
|
5
|
|
||||
Average common shares outstanding (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
472,355
|
|
|
490,840
|
|
|
|
|
479,536
|
|
|
495,015
|
|
|
|
||||||
Diluted
|
480,010
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|
|
494,780
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|
|
|
|
485,813
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|
|
498,417
|
|
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|
||||||
Cash dividends declared per common share
|
$
|
.24
|
|
|
$
|
.18
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|
|
|
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$
|
.72
|
|
|
$
|
.54
|
|
|
|
||
Return on average common equity
|
13.3
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%
|
|
11.2
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%
|
|
|
|
10.7
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%
|
|
10.8
|
%
|
|
|
|
|
|
|
|
Quarters Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||
(Dollars in millions)
|
2012
|
|
2011
|
|
% Change
|
|
2012
|
|
2011
|
|
% Change
|
||||||||||
Fee revenue:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Servicing fees
|
$
|
1,100
|
|
|
$
|
1,106
|
|
|
(1
|
)%
|
|
$
|
3,264
|
|
|
$
|
3,325
|
|
|
(2
|
)%
|
Management fees
|
251
|
|
|
229
|
|
|
10
|
|
|
733
|
|
|
715
|
|
|
3
|
|
||||
Trading services
|
232
|
|
|
334
|
|
|
(31
|
)
|
|
767
|
|
|
947
|
|
|
(19
|
)
|
||||
Securities finance
|
91
|
|
|
85
|
|
|
7
|
|
|
331
|
|
|
288
|
|
|
15
|
|
||||
Processing fees and other
|
45
|
|
|
90
|
|
|
(50
|
)
|
|
187
|
|
|
252
|
|
|
(26
|
)
|
||||
Total fee revenue
|
1,719
|
|
|
1,844
|
|
|
(7
|
)
|
|
5,282
|
|
|
5,527
|
|
|
(4
|
)
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net interest revenue:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest revenue
|
730
|
|
|
728
|
|
|
—
|
|
|
2,281
|
|
|
2,181
|
|
|
5
|
|
||||
Interest expense
|
111
|
|
|
150
|
|
|
(26
|
)
|
|
365
|
|
|
454
|
|
|
(20
|
)
|
||||
Net interest revenue
|
619
|
|
|
578
|
|
|
7
|
|
|
1,916
|
|
|
1,727
|
|
|
11
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Gains related to investment securities, net
|
18
|
|
|
5
|
|
|
|
|
2
|
|
|
25
|
|
|
|
||||||
Total revenue
|
$
|
2,356
|
|
|
$
|
2,427
|
|
|
(3
|
)
|
|
$
|
7,200
|
|
|
$
|
7,279
|
|
|
(1
|
)
|
|
Daily Averages of Indices
|
|
Averages of Month-End Indices
|
|
Quarter-End Indices
|
|||||||||||||||||||||
|
Quarters Ended September 30,
|
|
Quarters Ended September 30,
|
|
As of September 30,
|
|||||||||||||||||||||
|
2012
|
|
2011
|
|
% Change
|
|
2012
|
|
2011
|
|
% Change
|
|
2012
|
|
2011
|
|
% Change
|
|||||||||
S&P 500
®
|
1,401
|
|
|
1,225
|
|
|
14
|
%
|
|
1,409
|
|
|
1,214
|
|
|
16
|
%
|
|
1,441
|
|
|
1,131
|
|
|
27
|
%
|
NASDAQ
®
|
3,027
|
|
|
2,607
|
|
|
16
|
|
|
3,041
|
|
|
2,584
|
|
|
18
|
|
|
3,116
|
|
|
2,415
|
|
|
29
|
|
MSCI EAFE
®
|
1,468
|
|
|
1,531
|
|
|
(4
|
)
|
|
1,474
|
|
|
1,526
|
|
|
(3
|
)
|
|
1,511
|
|
|
1,373
|
|
|
10
|
|
|
Daily Averages of Indices
|
|
Averages of Month-End Indices
|
|
|
|
|
|
|
|||||||||||||||||
|
Nine Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
|
|
|
|
|
|||||||||||||||||
|
2012
|
|
2011
|
|
% Change
|
|
2012
|
|
2011
|
|
% Change
|
|
|
|
|
|
|
|||||||||
S&P 500
®
|
1,367
|
|
|
1,282
|
|
|
7
|
%
|
|
1,376
|
|
|
1,290
|
|
|
7
|
%
|
|
|
|
|
|
|
|||
NASDAQ
®
|
2,954
|
|
|
2,703
|
|
|
9
|
|
|
2,978
|
|
|
2,722
|
|
|
9
|
|
|
|
|
|
|
|
|||
MSCI EAFE
®
|
1,470
|
|
|
1,646
|
|
|
(11
|
)
|
|
1,478
|
|
|
1,663
|
|
|
(11
|
)
|
|
|
|
|
|
|
(In billions)
|
September 30,
2012 |
|
December 31,
2011 |
|
September 30,
2011 |
||||||
Mutual funds
|
$
|
5,828
|
|
|
$
|
5,265
|
|
|
$
|
5,117
|
|
Collective funds
|
4,912
|
|
|
4,437
|
|
|
4,317
|
|
|||
Pension products
|
5,258
|
|
|
4,837
|
|
|
4,940
|
|
|||
Insurance and other products
|
7,443
|
|
|
7,268
|
|
|
7,136
|
|
|||
Total
|
$
|
23,441
|
|
|
$
|
21,807
|
|
|
$
|
21,510
|
|
(In billions)
|
September 30,
2012 |
|
December 31,
2011 |
|
September 30,
2011 |
||||||
Equities
|
$
|
12,021
|
|
|
$
|
10,849
|
|
|
$
|
10,420
|
|
Fixed-income
|
8,518
|
|
|
8,317
|
|
|
8,345
|
|
|||
Short-term and other investments
|
2,902
|
|
|
2,641
|
|
|
2,745
|
|
|||
Total
|
$
|
23,441
|
|
|
$
|
21,807
|
|
|
$
|
21,510
|
|
(In billions)
|
September 30,
2012 |
|
December 31,
2011 |
|
September 30,
2011 |
||||||
United States
|
$
|
17,066
|
|
|
$
|
15,745
|
|
|
$
|
15,262
|
|
Other Americas
|
703
|
|
|
622
|
|
|
651
|
|
|||
Europe/Middle East/Africa
|
4,636
|
|
|
4,400
|
|
|
4,547
|
|
|||
Asia/Pacific
|
1,036
|
|
|
1,040
|
|
|
1,050
|
|
|||
Total
|
$
|
23,441
|
|
|
$
|
21,807
|
|
|
$
|
21,510
|
|
|
|
|
|
(In billions)
|
September 30,
2012 |
|
December 31,
2011 |
|
September 30,
2011 |
||||||
Passive:
|
|
|
|
|
|
||||||
Equities
|
$
|
727
|
|
|
$
|
638
|
|
|
$
|
596
|
|
Fixed-income
|
295
|
|
|
246
|
|
|
287
|
|
|||
Exchange-traded funds
(1)
|
336
|
|
|
274
|
|
|
247
|
|
|||
Other
|
199
|
|
|
195
|
|
|
188
|
|
|||
Total Passive
|
1,557
|
|
|
1,353
|
|
|
1,318
|
|
|||
Active:
|
|
|
|
|
|
||||||
Equities
|
51
|
|
|
50
|
|
|
47
|
|
|||
Fixed-income
|
18
|
|
|
19
|
|
|
19
|
|
|||
Other
|
56
|
|
|
45
|
|
|
43
|
|
|||
Total Active
|
125
|
|
|
114
|
|
|
109
|
|
|||
Cash
|
383
|
|
|
378
|
|
|
428
|
|
|||
Total
|
$
|
2,065
|
|
|
$
|
1,845
|
|
|
$
|
1,855
|
|
|
|
|
|
(In billions)
|
September 30,
2012 |
|
December 31,
2011 |
|
September 30,
2011 |
||||||
United States
|
$
|
1,385
|
|
|
$
|
1,285
|
|
|
$
|
1,296
|
|
Other Americas
|
34
|
|
|
30
|
|
|
30
|
|
|||
Europe/Middle East/Africa
|
341
|
|
|
320
|
|
|
331
|
|
|||
Asia/Pacific
|
305
|
|
|
210
|
|
|
198
|
|
|||
Total
|
$
|
2,065
|
|
|
$
|
1,845
|
|
|
$
|
1,855
|
|
|
|
|
|
(In billions)
|
|
||
September 30, 2011
|
$
|
1,855
|
|
Net lost business
(1)
|
(89
|
)
|
|
Market appreciation
|
79
|
|
|
December 31, 2011
|
$
|
1,845
|
|
Net new business
(1)
|
82
|
|
|
Market appreciation
|
138
|
|
|
September 30, 2012
|
$
|
2,065
|
|
|
|
|
|
|
Quarters Ended September 30,
|
||||||||||||||||||||
|
2012
|
|
2011
|
||||||||||||||||||
(Dollars in millions; fully taxable-equivalent basis)
|
Average
Balance
|
|
Interest
Revenue/
Expense
|
|
Rate
|
|
Average
Balance
|
|
Interest
Revenue/
Expense
|
|
Rate
|
||||||||||
Interest-bearing deposits with banks
|
$
|
26,553
|
|
|
$
|
31
|
|
|
.47
|
%
|
|
$
|
24,271
|
|
|
$
|
39
|
|
|
.64
|
%
|
Securities purchased under resale agreements
|
7,773
|
|
|
15
|
|
|
.72
|
|
|
5,728
|
|
|
6
|
|
|
.42
|
|
||||
Trading account assets
|
610
|
|
|
—
|
|
|
.13
|
|
|
2,084
|
|
|
—
|
|
|
—
|
|
||||
Investment securities
|
113,899
|
|
|
658
|
|
|
2.31
|
|
|
104,387
|
|
|
647
|
|
|
2.46
|
|
||||
Loans and leases
|
11,626
|
|
|
58
|
|
|
1.99
|
|
|
12,353
|
|
|
68
|
|
|
2.18
|
|
||||
Other interest-earning assets
|
8,136
|
|
|
—
|
|
|
.02
|
|
|
6,355
|
|
|
—
|
|
|
.03
|
|
||||
Total average interest-earning assets
|
$
|
168,597
|
|
|
$
|
762
|
|
|
1.80
|
|
|
$
|
155,178
|
|
|
$
|
760
|
|
|
1.95
|
|
Interest-bearing deposits:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S.
|
$
|
11,624
|
|
|
$
|
5
|
|
|
.14
|
%
|
|
$
|
3,201
|
|
|
$
|
2
|
|
|
.16
|
%
|
Non-U.S.
|
89,658
|
|
|
32
|
|
|
.14
|
|
|
84,083
|
|
|
50
|
|
|
.23
|
|
||||
Securities sold under repurchase agreements
|
7,757
|
|
|
—
|
|
|
.01
|
|
|
9,335
|
|
|
3
|
|
|
.13
|
|
||||
Federal funds purchased
|
722
|
|
|
—
|
|
|
.13
|
|
|
556
|
|
|
—
|
|
|
.01
|
|
||||
Other short-term borrowings
|
4,759
|
|
|
18
|
|
|
1.55
|
|
|
4,945
|
|
|
20
|
|
|
1.65
|
|
||||
Long-term debt
|
6,408
|
|
|
52
|
|
|
3.20
|
|
|
9,305
|
|
|
73
|
|
|
3.17
|
|
||||
Other interest-bearing liabilities
|
6,359
|
|
|
4
|
|
|
.25
|
|
|
3,803
|
|
|
2
|
|
|
.26
|
|
||||
Total average interest-bearing liabilities
|
$
|
127,287
|
|
|
$
|
111
|
|
|
.35
|
|
|
$
|
115,228
|
|
|
$
|
150
|
|
|
.52
|
|
Interest-rate spread
|
|
|
|
|
1.45
|
%
|
|
|
|
|
|
1.43
|
%
|
||||||||
Net interest revenue—fully taxable-equivalent basis
|
|
|
$
|
651
|
|
|
|
|
|
|
$
|
610
|
|
|
|
||||||
Net interest margin—fully taxable-equivalent basis
|
|
|
|
|
1.53
|
%
|
|
|
|
|
|
1.56
|
%
|
||||||||
Tax-equivalent adjustment
|
|
|
(32
|
)
|
|
|
|
|
|
(32
|
)
|
|
|
||||||||
Net interest revenue—GAAP basis
|
|
|
$
|
619
|
|
|
|
|
|
|
$
|
578
|
|
|
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||
|
2012
|
|
2011
|
||||||||||||||||||
(Dollars in millions; fully taxable-equivalent basis)
|
Average
Balance
|
|
Interest
Revenue/
Expense
|
|
Rate
|
|
Average
Balance
|
|
Interest
Revenue/
Expense
|
|
Rate
|
||||||||||
Interest-bearing deposits with banks
|
$
|
25,776
|
|
|
$
|
108
|
|
|
.56
|
%
|
|
$
|
16,255
|
|
|
$
|
94
|
|
|
.77
|
%
|
Securities purchased under resale agreements
|
7,735
|
|
|
37
|
|
|
.63
|
|
|
4,391
|
|
|
22
|
|
|
.67
|
|
||||
Trading account assets
|
659
|
|
|
—
|
|
|
.06
|
|
|
2,213
|
|
|
—
|
|
|
—
|
|
||||
Investment securities
|
112,109
|
|
|
2,044
|
|
|
2.43
|
|
|
101,585
|
|
|
1,944
|
|
|
2.56
|
|
||||
Loans and leases
|
11,232
|
|
|
184
|
|
|
2.19
|
|
|
12,602
|
|
|
216
|
|
|
2.29
|
|
||||
Other interest-earning assets
|
7,253
|
|
|
2
|
|
|
.03
|
|
|
5,182
|
|
|
1
|
|
|
.03
|
|
||||
Total average interest-earning assets
|
$
|
164,764
|
|
|
$
|
2,375
|
|
|
1.93
|
|
|
$
|
142,228
|
|
|
$
|
2,277
|
|
|
2.15
|
|
Interest-bearing deposits:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S.
|
$
|
7,192
|
|
|
$
|
12
|
|
|
.22
|
%
|
|
$
|
3,312
|
|
|
$
|
8
|
|
|
.30
|
%
|
Non-U.S.
|
88,250
|
|
|
115
|
|
|
.17
|
|
|
82,069
|
|
|
146
|
|
|
.24
|
|
||||
Securities sold under repurchase agreements
|
7,828
|
|
|
1
|
|
|
.01
|
|
|
9,190
|
|
|
8
|
|
|
.12
|
|
||||
Federal funds purchased
|
835
|
|
|
—
|
|
|
.09
|
|
|
943
|
|
|
—
|
|
|
.05
|
|
||||
Other short-term borrowings
|
4,723
|
|
|
54
|
|
|
1.53
|
|
|
5,201
|
|
|
66
|
|
|
1.70
|
|
||||
Long-term debt
|
7,160
|
|
|
172
|
|
|
3.20
|
|
|
9,254
|
|
|
220
|
|
|
3.17
|
|
||||
Other interest-bearing liabilities
|
6,023
|
|
|
11
|
|
|
.25
|
|
|
3,127
|
|
|
6
|
|
|
.26
|
|
||||
Total average interest-bearing liabilities
|
$
|
122,011
|
|
|
$
|
365
|
|
|
.40
|
|
|
$
|
113,096
|
|
|
$
|
454
|
|
|
.55
|
|
Interest-rate spread
|
|
|
|
|
1.53
|
%
|
|
|
|
|
|
1.60
|
%
|
||||||||
Net interest revenue—fully taxable-equivalent basis
|
|
|
$
|
2,010
|
|
|
|
|
|
|
$
|
1,823
|
|
|
|
||||||
Net interest margin—fully taxable-equivalent basis
|
|
|
|
|
1.63
|
%
|
|
|
|
|
|
1.71
|
%
|
||||||||
Tax-equivalent adjustment
|
|
|
(94
|
)
|
|
|
|
|
|
(96
|
)
|
|
|
||||||||
Net interest revenue—GAAP basis
|
|
|
$
|
1,916
|
|
|
|
|
|
|
$
|
1,727
|
|
|
|
|
Quarters Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(In millions)
|
2012
|
|
2011
|
|
2,012
|
|
2011
|
||||||||
Average U.S. short-duration advances
|
$
|
1,813
|
|
|
$
|
2,284
|
|
|
$
|
1,815
|
|
|
$
|
2,038
|
|
Average non-U.S. short-duration advances
|
1,319
|
|
|
1,448
|
|
|
1,362
|
|
|
1,634
|
|
||||
Total average short-duration advances
|
$
|
3,132
|
|
|
$
|
3,732
|
|
|
$
|
3,177
|
|
|
$
|
3,672
|
|
|
Quarters Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(In millions)
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Net realized gains from sales of available-for-sale securities
|
$
|
24
|
|
|
$
|
15
|
|
|
$
|
29
|
|
|
$
|
81
|
|
|
|
|
|
|
|
|
|
||||||||
Losses from other-than-temporary impairment
|
(4
|
)
|
|
(25
|
)
|
|
(50
|
)
|
|
(104
|
)
|
||||
Losses not related to credit
(1)
|
(2
|
)
|
|
15
|
|
|
23
|
|
|
48
|
|
||||
Net impairment losses
|
(6
|
)
|
|
(10
|
)
|
|
(27
|
)
|
|
(56
|
)
|
||||
Gains (losses) related to investment securities, net
|
$
|
18
|
|
|
$
|
5
|
|
|
$
|
2
|
|
|
$
|
25
|
|
|
|
|
|
|
|
|
|
||||||||
Impairment associated with expected credit losses
|
$
|
(1
|
)
|
|
$
|
(7
|
)
|
|
$
|
(14
|
)
|
|
$
|
(36
|
)
|
Impairment associated with management’s intent to sell the impaired securities prior to their recovery in value
|
—
|
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
||||
Impairment associated with adverse changes in timing of expected future cash flows
|
(5
|
)
|
|
(3
|
)
|
|
(13
|
)
|
|
(12
|
)
|
||||
Net impairment losses
|
$
|
(6
|
)
|
|
$
|
(10
|
)
|
|
$
|
(27
|
)
|
|
$
|
(56
|
)
|
|
|
|
|
|
Quarters Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||
(Dollars in millions)
|
2012
|
|
2011
|
|
% Change
|
|
2012
|
|
2011
|
|
% Change
|
||||||||||
Compensation and employee benefits
|
$
|
916
|
|
|
$
|
965
|
|
|
(5
|
)%
|
|
$
|
2,922
|
|
|
$
|
2,948
|
|
|
(1
|
)%
|
Information systems and communications
|
211
|
|
|
191
|
|
|
10
|
|
|
610
|
|
|
581
|
|
|
5
|
|
||||
Transaction processing services
|
170
|
|
|
180
|
|
|
(6
|
)
|
|
523
|
|
|
553
|
|
|
(5
|
)
|
||||
Occupancy
|
115
|
|
|
119
|
|
|
(3
|
)
|
|
349
|
|
|
339
|
|
|
3
|
|
||||
Claims resolution
|
(362
|
)
|
|
—
|
|
|
|
|
(362
|
)
|
|
—
|
|
|
|
||||||
Provisions for litigation exposure
|
60
|
|
|
—
|
|
|
|
|
82
|
|
|
—
|
|
|
|
||||||
Acquisition costs
|
13
|
|
|
19
|
|
|
|
|
|
41
|
|
|
46
|
|
|
|
|
||||
Restructuring charges, net
|
15
|
|
|
66
|
|
|
|
|
|
45
|
|
|
75
|
|
|
|
|
||||
Other:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Professional services
|
89
|
|
|
83
|
|
|
7
|
|
|
266
|
|
|
249
|
|
|
7
|
|
||||
Amortization of other intangible assets
|
46
|
|
|
50
|
|
|
(8
|
)
|
|
145
|
|
|
149
|
|
|
(3
|
)
|
||||
Securities processing costs (recoveries)
|
2
|
|
|
2
|
|
|
|
|
|
26
|
|
|
(15
|
)
|
|
|
|
||||
Regulator fees and assessments
|
12
|
|
|
11
|
|
|
9
|
|
|
37
|
|
|
32
|
|
|
16
|
|
||||
Other
|
128
|
|
|
112
|
|
|
14
|
|
|
338
|
|
|
317
|
|
|
7
|
|
||||
Total other
|
277
|
|
|
258
|
|
|
7
|
|
|
812
|
|
|
732
|
|
|
11
|
|
||||
Total expenses
|
$
|
1,415
|
|
|
$
|
1,798
|
|
|
(21
|
)
|
|
$
|
5,022
|
|
|
$
|
5,274
|
|
|
(5
|
)
|
Number of employees at quarter-end
|
29,650
|
|
|
29,685
|
|
|
|
|
|
|
|
|
|
(In millions)
|
Employee-Related
Costs
|
|
Real Estate
Consolidation
|
|
Information
Technology Costs
|
|
Total
|
||||||||
2010
|
$
|
105
|
|
|
$
|
51
|
|
|
|
|
$
|
156
|
|
||
2011
|
85
|
|
|
7
|
|
|
$
|
41
|
|
|
133
|
|
|||
First nine months of 2012
|
21
|
|
|
7
|
|
|
20
|
|
|
48
|
|
||||
Total
|
$
|
211
|
|
|
$
|
65
|
|
|
$
|
61
|
|
|
$
|
337
|
|
(In millions)
|
Employee-Related
Costs
|
|
Fixed-Income Trading Portfolio
|
|
Asset and Other Write-Offs
|
|
Total
|
||||||||
2011
|
$
|
62
|
|
|
$
|
38
|
|
|
$
|
20
|
|
|
$
|
120
|
|
First quarter of 2012
|
3
|
|
|
(10
|
)
|
|
—
|
|
|
(7
|
)
|
||||
Second quarter of 2012
|
(2
|
)
|
|
1
|
|
|
5
|
|
|
4
|
|
||||
Total
|
$
|
63
|
|
|
$
|
29
|
|
|
$
|
25
|
|
|
$
|
117
|
|
(In millions)
|
Employee-
Related
Costs
|
|
Real Estate
Consolidation
|
|
Information Technology
Costs
|
|
Fixed-Income Trading Portfolio
|
|
Asset and Other Write-Offs
|
|
Total
|
||||||||||||
Initial restructuring-related accrual
|
$
|
105
|
|
|
$
|
51
|
|
|
|
|
|
|
|
|
$
|
156
|
|
||||||
Payments
|
(15
|
)
|
|
(4
|
)
|
|
|
|
|
|
|
|
(19
|
)
|
|||||||||
Balance at December 31, 2010
|
90
|
|
|
47
|
|
|
|
|
|
|
|
|
137
|
|
|||||||||
Accruals for Business Operations and Information Technology Transformation program
|
85
|
|
|
7
|
|
|
$
|
41
|
|
|
|
|
|
|
133
|
|
|||||||
Accruals for expense control measures
|
62
|
|
|
—
|
|
|
—
|
|
|
$
|
38
|
|
|
$
|
20
|
|
|
120
|
|
||||
Payments and adjustments
|
(75
|
)
|
|
(15
|
)
|
|
(8
|
)
|
|
—
|
|
|
(5
|
)
|
|
(103
|
)
|
||||||
Balance at December 31, 2011
|
162
|
|
|
39
|
|
|
33
|
|
|
38
|
|
|
15
|
|
|
287
|
|
||||||
Accruals for Business Operations and Information Technology Transformation program
|
21
|
|
|
7
|
|
|
20
|
|
|
—
|
|
|
—
|
|
|
48
|
|
||||||
Net accruals for expense control measures
|
1
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
|
5
|
|
|
(3
|
)
|
||||||
Payments and adjustments
|
(101
|
)
|
|
(6
|
)
|
|
(36
|
)
|
|
(29
|
)
|
|
(6
|
)
|
|
(178
|
)
|
||||||
Balance at September 30, 2012
|
$
|
83
|
|
|
$
|
40
|
|
|
$
|
17
|
|
|
$
|
—
|
|
|
$
|
14
|
|
|
$
|
154
|
|
|
Quarters Ended September 30,
|
||||||||||||||||||||||||||||||
|
Investment
Servicing
|
|
Investment
Management
|
|
Other
|
|
Total
|
||||||||||||||||||||||||
(Dollars in millions,
except where otherwise noted)
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||||||||||
Fee revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Servicing fees
|
$
|
1,100
|
|
|
$
|
1,106
|
|
|
|
|
|
|
|
|
|
|
$
|
1,100
|
|
|
$
|
1,106
|
|
||||||||
Management fees
|
—
|
|
|
—
|
|
|
$
|
251
|
|
|
$
|
229
|
|
|
|
|
|
|
251
|
|
|
229
|
|
||||||||
Trading services
|
232
|
|
|
334
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
232
|
|
|
334
|
|
||||||||||
Securities finance
|
81
|
|
|
77
|
|
|
10
|
|
|
8
|
|
|
|
|
|
|
91
|
|
|
85
|
|
||||||||||
Processing fees and other
|
15
|
|
|
57
|
|
|
30
|
|
|
33
|
|
|
|
|
|
|
45
|
|
|
90
|
|
||||||||||
Total fee revenue
|
1,428
|
|
|
1,574
|
|
|
291
|
|
|
270
|
|
|
|
|
|
|
1,719
|
|
|
1,844
|
|
||||||||||
Net interest revenue
|
600
|
|
|
553
|
|
|
19
|
|
|
25
|
|
|
|
|
|
|
619
|
|
|
578
|
|
||||||||||
Gains related to investment
securities, net
|
18
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
18
|
|
|
5
|
|
||||||||||
Total revenue
|
2,046
|
|
|
2,132
|
|
|
310
|
|
|
295
|
|
|
|
|
|
|
|
2,356
|
|
|
2,427
|
|
|||||||||
Expenses from operations
|
1,456
|
|
|
1,475
|
|
|
208
|
|
|
238
|
|
|
|
|
|
|
1,664
|
|
|
1,713
|
|
||||||||||
Claims resolution
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
(362
|
)
|
|
|
|
(362
|
)
|
|
—
|
|
||||||||
Provisions for litigation exposure and other costs
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
85
|
|
|
|
|
85
|
|
|
—
|
|
|||||||||
Acquisition and restructuring costs
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
28
|
|
|
$
|
85
|
|
|
28
|
|
|
85
|
|
|||||||
Total expenses
|
1,456
|
|
|
1,475
|
|
|
208
|
|
|
238
|
|
|
(249
|
)
|
|
85
|
|
|
1,415
|
|
|
1,798
|
|
||||||||
Income (loss) before income tax expense
|
$
|
590
|
|
|
$
|
657
|
|
|
$
|
102
|
|
|
$
|
57
|
|
|
$
|
249
|
|
|
$
|
(85
|
)
|
|
$
|
941
|
|
|
$
|
629
|
|
Pre-tax margin
|
29
|
%
|
|
31
|
%
|
|
33
|
%
|
|
19
|
%
|
|
|
|
|
|
|
|
|
||||||||||||
Average assets (in billions)
|
$
|
191.6
|
|
|
$
|
177.0
|
|
|
$
|
4.2
|
|
|
$
|
4.0
|
|
|
|
|
|
|
$
|
195.8
|
|
|
$
|
181.0
|
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||||||||
|
Investment
Servicing
|
|
Investment
Management
|
|
Other
|
|
Total
|
||||||||||||||||||||||||
(Dollars in millions,
except where otherwise noted)
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||||||||||
Fee revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Servicing fees
|
$
|
3,264
|
|
|
$
|
3,325
|
|
|
|
|
|
|
|
|
|
|
$
|
3,264
|
|
|
$
|
3,325
|
|
||||||||
Management fees
|
—
|
|
|
—
|
|
|
$
|
733
|
|
|
$
|
715
|
|
|
|
|
|
|
733
|
|
|
715
|
|
||||||||
Trading services
|
767
|
|
|
947
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
767
|
|
|
947
|
|
||||||||||
Securities finance
|
296
|
|
|
252
|
|
|
35
|
|
|
36
|
|
|
|
|
|
|
331
|
|
|
288
|
|
||||||||||
Processing fees and other
|
112
|
|
|
179
|
|
|
75
|
|
|
73
|
|
|
|
|
|
|
187
|
|
|
252
|
|
||||||||||
Total fee revenue
|
4,439
|
|
|
4,703
|
|
|
843
|
|
|
824
|
|
|
|
|
|
|
5,282
|
|
|
5,527
|
|
||||||||||
Net interest revenue
|
1,854
|
|
|
1,647
|
|
|
62
|
|
|
80
|
|
|
|
|
|
|
1,916
|
|
|
1,727
|
|
||||||||||
Gains (losses) related to investment securities, net
|
48
|
|
|
25
|
|
|
—
|
|
|
—
|
|
|
$
|
(46
|
)
|
|
|
|
2
|
|
|
25
|
|
||||||||
Total revenue
|
6,341
|
|
|
6,375
|
|
|
905
|
|
|
904
|
|
|
(46
|
)
|
|
|
|
7,200
|
|
|
7,279
|
|
|||||||||
Provision for loan losses
|
(1
|
)
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
(1
|
)
|
|
1
|
|
|||||||||
Expenses from operations
|
4,530
|
|
|
4,452
|
|
|
661
|
|
|
701
|
|
|
—
|
|
|
|
|
5,191
|
|
|
5,153
|
|
|||||||||
Claims resolution
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(362
|
)
|
|
|
|
(362
|
)
|
|
—
|
|
|||||||||
Provisions for litigation exposure and other costs
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
107
|
|
|
|
|
107
|
|
|
—
|
|
|||||||||
Acquisition and restructuring costs, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
86
|
|
|
$
|
121
|
|
|
86
|
|
|
121
|
|
|||||||
Total expenses
|
4,530
|
|
|
4,452
|
|
|
661
|
|
|
701
|
|
|
(169
|
)
|
|
121
|
|
|
5,022
|
|
|
5,274
|
|
||||||||
Income (loss) before income tax expense
|
$
|
1,812
|
|
|
$
|
1,922
|
|
|
$
|
244
|
|
|
$
|
203
|
|
|
$
|
123
|
|
|
$
|
(121
|
)
|
|
$
|
2,179
|
|
|
$
|
2,004
|
|
Pre-tax margin
|
29
|
%
|
|
30
|
%
|
|
27
|
%
|
|
22
|
%
|
|
|
|
|
|
|
|
|
||||||||||||
Average assets (in billions)
|
$
|
187.0
|
|
|
$
|
163.4
|
|
|
$
|
4.0
|
|
|
$
|
4.6
|
|
|
|
|
|
|
$
|
191.0
|
|
|
$
|
168.0
|
|
(In millions)
|
Average Balance Nine Months Ended September 30, 2012
|
|
Average Balance Nine Months Ended September 30, 2011
|
||||
Assets:
|
|
|
|
||||
Interest-bearing deposits with banks
|
$
|
25,776
|
|
|
$
|
16,255
|
|
Securities purchased under resale agreements
|
7,735
|
|
|
4,391
|
|
||
Trading account assets
|
659
|
|
|
2,213
|
|
||
Investment securities
|
112,109
|
|
|
101,585
|
|
||
Loans and leases
|
11,232
|
|
|
12,602
|
|
||
Other interest-earning assets
|
7,253
|
|
|
5,182
|
|
||
Total interest-earning assets
|
164,764
|
|
|
142,228
|
|
||
Cash and due from banks
|
3,798
|
|
|
2,809
|
|
||
Other noninterest-earning assets
|
22,482
|
|
|
22,997
|
|
||
Total assets
|
$
|
191,044
|
|
|
$
|
168,034
|
|
Liabilities and shareholders’ equity:
|
|
|
|
||||
Interest-bearing deposits:
|
|
|
|
||||
U.S.
|
$
|
7,192
|
|
|
$
|
3,312
|
|
Non-U.S.
|
88,250
|
|
|
82,069
|
|
||
Total interest-bearing deposits
|
95,442
|
|
|
85,381
|
|
||
Securities sold under repurchase agreements
|
7,828
|
|
|
9,190
|
|
||
Federal funds purchased
|
835
|
|
|
943
|
|
||
Other short-term borrowings
|
4,723
|
|
|
5,201
|
|
||
Long-term debt
|
7,160
|
|
|
9,254
|
|
||
Other interest-bearing liabilities
|
6,023
|
|
|
3,127
|
|
||
Total interest-bearing liabilities
|
122,011
|
|
|
113,096
|
|
||
Non-interest-bearing deposits
|
36,401
|
|
|
22,440
|
|
||
Other noninterest-bearing liabilities
|
12,632
|
|
|
13,207
|
|
||
Preferred shareholders’ equity
|
524
|
|
|
366
|
|
||
Common shareholders’ equity
|
19,476
|
|
|
18,925
|
|
||
Total liabilities and shareholders’ equity
|
$
|
191,044
|
|
|
$
|
168,034
|
|
(In millions)
|
September 30,
2012 |
|
December 31,
2011 |
||||
Available for sale:
|
|
|
|
||||
U.S. Treasury and federal agencies:
|
|
|
|
||||
Direct obligations
|
$
|
870
|
|
|
$
|
2,836
|
|
Mortgage-backed securities
|
32,003
|
|
|
30,021
|
|
||
Asset-backed securities:
|
|
|
|
||||
Student loans
(1)
|
16,537
|
|
|
16,545
|
|
||
Credit cards
|
9,966
|
|
|
10,487
|
|
||
Sub-prime
|
1,379
|
|
|
1,404
|
|
||
Other
|
4,126
|
|
|
3,465
|
|
||
Total asset-backed securities
|
32,008
|
|
|
31,901
|
|
||
Non-U.S. debt securities:
|
|
|
|
||||
Mortgage-backed securities
|
11,044
|
|
|
10,875
|
|
||
Asset-backed securities
|
5,920
|
|
|
4,303
|
|
||
Government securities
|
2,986
|
|
|
1,671
|
|
||
Other
|
4,034
|
|
|
2,825
|
|
||
Total non-U.S. debt securities
|
23,984
|
|
|
19,674
|
|
||
State and political subdivisions
|
7,304
|
|
|
7,047
|
|
||
Collateralized mortgage obligations
|
4,845
|
|
|
3,980
|
|
||
Other U.S. debt securities
|
5,104
|
|
|
3,615
|
|
||
U.S. equity securities
|
881
|
|
|
640
|
|
||
Non-U.S. equity securities
|
130
|
|
|
118
|
|
||
Total
|
$
|
107,129
|
|
|
$
|
99,832
|
|
Held to Maturity:
|
|
|
|
||||
U.S. Treasury and federal agencies:
|
|
|
|
||||
Direct obligations
|
$
|
1,500
|
|
|
|
||
Mortgage-backed securities
|
180
|
|
|
$
|
265
|
|
|
Asset-backed securities
|
8
|
|
|
31
|
|
||
Non-U.S. debt securities:
|
|
|
|
||||
Mortgage-backed securities
|
3,409
|
|
|
4,973
|
|
||
Asset-backed securities
|
441
|
|
|
436
|
|
||
Government securities
|
3
|
|
|
3
|
|
||
Other
|
165
|
|
|
172
|
|
||
Total non-U.S. debt securities
|
4,018
|
|
|
5,584
|
|
||
State and political subdivisions
|
80
|
|
|
107
|
|
||
Collateralized mortgage obligations
|
2,574
|
|
|
3,334
|
|
||
Total
|
$
|
8,360
|
|
|
$
|
9,321
|
|
|
|
|
|
(1)
|
Substantially composed of securities guaranteed by the federal government with respect to at least 97% of defaulted principal and accrued interest on the underlying loans.
|
|
September 30,
2012 |
|
December 31,
2011 |
||
AAA
(1)
|
68
|
%
|
|
75
|
%
|
AA
|
20
|
|
|
14
|
|
A
|
7
|
|
|
7
|
|
BBB
|
3
|
|
|
2
|
|
Below BBB
|
2
|
|
|
2
|
|
|
100
|
%
|
|
100
|
%
|
|
|
|
|
(1)
|
Includes U.S. Treasury securities that are split-rated, “AAA” by Moody’s Investors Service and “AA+” by Standard & Poor’s.
|
(In millions)
|
September 30,
2012 |
|
December 31,
2011 |
||||
Available for sale:
|
|
|
|
||||
United Kingdom
|
$
|
10,183
|
|
|
$
|
8,851
|
|
Australia
|
3,497
|
|
|
3,154
|
|
||
Netherlands
|
3,093
|
|
|
3,109
|
|
||
Canada
|
2,054
|
|
|
1,905
|
|
||
Germany
|
1,926
|
|
|
1,510
|
|
||
Japan
|
1,299
|
|
|
—
|
|
||
France
|
1,038
|
|
|
329
|
|
||
Finland
|
252
|
|
|
—
|
|
||
Norway
|
123
|
|
|
89
|
|
||
Italy
|
118
|
|
|
231
|
|
||
Spain
|
92
|
|
|
228
|
|
||
Other
|
309
|
|
|
268
|
|
||
Total
|
$
|
23,984
|
|
|
$
|
19,674
|
|
Held to maturity:
|
|
|
|
||||
Australia
|
$
|
2,299
|
|
|
$
|
2,572
|
|
United Kingdom
|
1,113
|
|
|
2,259
|
|
||
Italy
|
275
|
|
|
297
|
|
||
Spain
|
200
|
|
|
220
|
|
||
Other
|
131
|
|
|
236
|
|
||
Total
|
$
|
4,018
|
|
|
$
|
5,584
|
|
September 30, 2012
(Dollars in millions)
|
Total Municipal
Securities
|
|
Credit and
Liquidity Facilities
|
|
Total
|
|
% of Total Municipal
Exposure
|
|||||||
State of Issuer:
|
|
|
|
|
|
|
|
|||||||
Texas
|
$
|
999
|
|
|
$
|
2,065
|
|
|
$
|
3,064
|
|
|
19
|
%
|
California
|
189
|
|
|
1,294
|
|
|
1,483
|
|
|
9
|
|
|||
New York
|
488
|
|
|
973
|
|
|
1,461
|
|
|
9
|
|
|||
Massachusetts
|
873
|
|
|
402
|
|
|
1,275
|
|
|
8
|
|
|||
New Jersey
|
830
|
|
|
—
|
|
|
830
|
|
|
5
|
|
|||
Florida
|
144
|
|
|
685
|
|
|
829
|
|
|
5
|
|
|||
Wisconsin
|
441
|
|
|
335
|
|
|
776
|
|
|
5
|
|
|||
Total
|
$
|
3,964
|
|
|
$
|
5,754
|
|
|
$
|
9,718
|
|
|
|
December 31, 2011 (Dollars in millions)
|
Total Municipal
Securities
|
|
Credit and
Liquidity Facilities
|
|
Total
|
|
% of Total Municipal Exposure
|
|||||||
State of Issuer:
|
|
|
|
|
|
|
|
|||||||
Texas
|
$
|
1,002
|
|
|
$
|
1,669
|
|
|
$
|
2,671
|
|
|
17
|
%
|
California
|
192
|
|
|
1,496
|
|
|
1,688
|
|
|
11
|
|
|||
Massachusetts
|
841
|
|
|
478
|
|
|
1,319
|
|
|
9
|
|
|||
New York
|
309
|
|
|
596
|
|
|
905
|
|
|
6
|
|
|||
Wisconsin
|
491
|
|
|
407
|
|
|
898
|
|
|
6
|
|
|||
Florida
|
165
|
|
|
686
|
|
|
851
|
|
|
6
|
|
|||
Total
|
$
|
3,000
|
|
|
$
|
5,332
|
|
|
$
|
8,332
|
|
|
|
(In millions)
|
September 30,
2012 |
|
December 31,
2011 |
||||
Fair value
|
$
|
107,129
|
|
|
$
|
99,832
|
|
Amortized cost
|
106,141
|
|
|
100,013
|
|
||
Net unrealized gain (loss), pre-tax
|
$
|
988
|
|
|
$
|
(181
|
)
|
Net unrealized gain (loss), after-tax
|
$
|
621
|
|
|
$
|
(113
|
)
|
(In millions)
|
September 30,
2012 |
|
December 31,
2011 |
||||
Institutional:
|
|
|
|
||||
U.S.
|
$
|
10,931
|
|
|
$
|
7,115
|
|
Non-U.S.
|
2,697
|
|
|
2,478
|
|
||
Commercial real estate:
|
|
|
|
||||
U.S.
|
418
|
|
|
460
|
|
||
Total loans and leases
|
$
|
14,046
|
|
|
$
|
10,053
|
|
Allowance for loan losses
|
(22
|
)
|
|
(22
|
)
|
||
Loans and leases, net of allowance for loan losses
|
$
|
14,024
|
|
|
$
|
10,031
|
|
|
Nine Months Ended September 30,
|
||||||
(In millions)
|
2012
|
|
2011
|
||||
Allowance for loan losses:
|
|
|
|
||||
Beginning balance
|
$
|
22
|
|
|
$
|
100
|
|
Charge-offs
|
—
|
|
|
(79
|
)
|
||
Provisions
|
(1
|
)
|
|
1
|
|
||
Recoveries
|
1
|
|
|
—
|
|
||
Ending balance
|
$
|
22
|
|
|
$
|
22
|
|
|
|||||||||||
(In millions)
|
Investment
Securities and
Other Assets
|
|
Derivatives and Securities on Loan
|
|
Total Cross-Border
Outstandings
|
||||||
September 30, 2012
|
|
|
|
|
|
||||||
United Kingdom
|
$
|
17,481
|
|
|
$
|
1,181
|
|
|
$
|
18,662
|
|
Germany
|
7,927
|
|
|
173
|
|
|
8,100
|
|
|||
Australia
|
6,951
|
|
|
317
|
|
|
7,268
|
|
|||
Switzerland
|
4,068
|
|
|
312
|
|
|
4,380
|
|
|||
Japan
|
3,956
|
|
|
138
|
|
|
4,094
|
|
|||
Netherlands
|
3,212
|
|
|
239
|
|
|
3,451
|
|
|||
Canada
|
2,590
|
|
|
470
|
|
|
3,060
|
|
|||
|
|
|
|
|
|
||||||
December 31, 2011
|
|
|
|
|
|
|
|
|
|||
United Kingdom
|
$
|
13,336
|
|
|
$
|
1,510
|
|
|
$
|
14,846
|
|
Australia
|
6,786
|
|
|
263
|
|
|
7,049
|
|
|||
Germany
|
6,321
|
|
|
578
|
|
|
6,899
|
|
|||
Netherlands
|
3,626
|
|
|
197
|
|
|
3,823
|
|
|||
Canada
|
2,235
|
|
|
496
|
|
|
2,731
|
|
(In millions)
|
Investment
Securities and
Other Assets
|
|
Derivatives and Securities on Loan
|
|
Total Cross-border
Outstandings
|
||||||
September 30, 2012
|
|
|
|
|
|
||||||
Italy
|
$
|
1,339
|
|
|
$
|
3
|
|
|
$
|
1,342
|
|
Ireland
|
336
|
|
|
148
|
|
|
484
|
|
|||
Spain
|
293
|
|
|
30
|
|
|
323
|
|
|||
Portugal
|
96
|
|
|
—
|
|
|
96
|
|
|||
|
|
|
|
|
|
|
|||||
December 31, 2011
|
|
|
|
|
|
|
|
|
|||
Italy
|
$
|
1,049
|
|
|
$
|
11
|
|
|
$
|
1,060
|
|
Ireland
|
299
|
|
|
267
|
|
|
566
|
|
|||
Spain
|
434
|
|
|
53
|
|
|
487
|
|
|||
Portugal
|
176
|
|
|
—
|
|
|
176
|
|
|||
Greece
|
99
|
|
|
—
|
|
|
99
|
|
|
Regulatory
Guidelines
(1)
|
|
State Street
|
|
State Street Bank
|
||||||||||||||||
(Dollars in millions)
|
Minimum
|
|
Well
Capitalized
|
|
September 30,
2012 |
|
December 31,
2011 |
|
September 30,
2012 |
|
December 31,
2011 |
||||||||||
Tier 1 risk-based capital ratio
|
4
|
%
|
|
6
|
%
|
|
19.8
|
%
|
|
18.8
|
%
|
|
18.0
|
%
|
|
17.6
|
%
|
||||
Total risk-based capital ratio
|
8
|
|
|
10
|
|
|
21.3
|
|
|
20.5
|
|
|
19.9
|
|
|
19.6
|
|
||||
Tier 1 leverage ratio
|
4
|
|
|
5
|
|
|
7.6
|
|
|
7.3
|
|
|
6.8
|
|
|
6.7
|
|
||||
Tier 1 risk-based capital
|
|
|
|
|
$
|
14,253
|
|
|
$
|
13,644
|
|
|
$
|
12,585
|
|
|
$
|
12,224
|
|
||
Total risk-based capital
|
|
|
|
|
15,364
|
|
|
14,842
|
|
|
13,887
|
|
|
13,607
|
|
||||||
Adjusted risk-weighted assets and market-risk equivalents:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
On-balance sheet risk-weighted assets
|
|
|
|
|
$
|
59,568
|
|
|
$
|
52,642
|
|
|
$
|
57,355
|
|
|
$
|
49,659
|
|
||
Off-balance sheet equivalent risk-weighted assets
|
|
|
|
|
11,997
|
|
|
19,115
|
|
|
11,981
|
|
|
19,109
|
|
||||||
Market risk equivalent assets
|
|
|
|
|
502
|
|
|
661
|
|
|
431
|
|
|
611
|
|
||||||
Total risk-weighted assets
|
|
|
|
|
$
|
72,067
|
|
|
$
|
72,418
|
|
|
$
|
69,767
|
|
|
$
|
69,379
|
|
||
Adjusted quarterly average assets
|
|
|
|
|
$
|
187,612
|
|
|
$
|
186,336
|
|
|
$
|
184,544
|
|
|
$
|
183,086
|
|
|
|
|
|
(1)
|
State Street Bank must comply with regulatory guidelines for “well capitalized” in order for the parent company to maintain its status as a financial holding company, including maintaining a minimum tier 1 risk-based capital ratio of 6%, a minimum total risk-based capital ratio of 10%, and a tier 1 leverage ratio of 5%. In addition, State Street must comply with Federal Reserve guidelines for “well capitalized” for a bank holding company to be eligible for a streamlined review process for acquisition proposals. These guidelines require us to maintain a minimum tier 1 risk-based capital ratio of 6% and a minimum total risk-based capital ratio of 10%.
|
•
|
Market risk: the risk of adverse financial impact due to fluctuations in market prices, primarily as they relate to our trading activities;
|
•
|
Interest-rate risk: the risk of loss in non-trading asset and liability management positions, primarily the impact of adverse movements in interest rates on the repricing mismatches that exist between the assets and liabilities carried in our consolidated statement of condition;
|
•
|
Credit risk: the risk of loss that may result from the default or downgrade of a borrower or counterparty;
|
•
|
Operational risk: the risk of loss from inadequate or failed internal processes, people and systems, or from external events, which is consistent with the Basel II definition; and
|
•
|
Business risk: the risk of negative earnings resulting from adverse changes in business factors, including changes in the competitive environment, changes in the operational economics of our business activities, and the effect of strategic and reputation risks.
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||
|
2012
|
|
2011
|
||||||||||||||||||||
(In millions)
|
Average
|
|
Maximum
|
|
Minimum
|
|
Average
|
|
Maximum
|
|
Minimum
|
||||||||||||
Foreign exchange rates
|
$
|
2.0
|
|
|
$
|
5.0
|
|
|
$
|
0.5
|
|
|
$
|
2.4
|
|
|
$
|
6.0
|
|
|
$
|
0.4
|
|
Interest rates
|
1.2
|
|
|
2.1
|
|
|
0.5
|
|
|
5.5
|
|
|
11.1
|
|
|
1.9
|
|
||||||
Total VaR for trading assets
|
2.4
|
|
|
4.7
|
|
|
1.0
|
|
|
6.0
|
|
|
11.1
|
|
|
2.4
|
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||
|
2012
|
|
2011
|
||||||||||||||||||||
(In millions)
|
Average
|
|
Maximum
|
|
Minimum
|
|
Average
|
|
Maximum
|
|
Minimum
|
||||||||||||
VaR for trading assets
|
$
|
2.4
|
|
|
$
|
4.7
|
|
|
$
|
1.0
|
|
|
$
|
6.0
|
|
|
$
|
11.1
|
|
|
$
|
2.4
|
|
VaR for non-trading assets
|
1.6
|
|
|
2.0
|
|
|
1.3
|
|
|
1.6
|
|
|
1.9
|
|
|
1.4
|
|
||||||
Total regulatory VaR
|
3.9
|
|
|
6.1
|
|
|
2.6
|
|
|
7.7
|
|
|
12.9
|
|
|
4.1
|
|
|
Estimated Sensitivity of
Economic Value of Equity
|
||||||
(In millions)
|
September 30,
2012 |
|
December 31,
2011 |
||||
Rate change:
|
|
|
|
||||
+200 bps shock
|
$
|
(1,952
|
)
|
|
$
|
(1,936
|
)
|
–200 bps shock
|
(48
|
)
|
|
490
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(Dollars in millions, except per share amounts)
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Fee revenue:
|
|
|
|
|
|
|
|
||||||||
Servicing fees
|
$
|
1,100
|
|
|
$
|
1,106
|
|
|
$
|
3,264
|
|
|
$
|
3,325
|
|
Management fees
|
251
|
|
|
229
|
|
|
733
|
|
|
715
|
|
||||
Trading services
|
232
|
|
|
334
|
|
|
767
|
|
|
947
|
|
||||
Securities finance
|
91
|
|
|
85
|
|
|
331
|
|
|
288
|
|
||||
Processing fees and other
|
45
|
|
|
90
|
|
|
187
|
|
|
252
|
|
||||
Total fee revenue
|
1,719
|
|
|
1,844
|
|
|
5,282
|
|
|
5,527
|
|
||||
Net interest revenue:
|
|
|
|
|
|
|
|
||||||||
Interest revenue
|
730
|
|
|
728
|
|
|
2,281
|
|
|
2,181
|
|
||||
Interest expense
|
111
|
|
|
150
|
|
|
365
|
|
|
454
|
|
||||
Net interest revenue
|
619
|
|
|
578
|
|
|
1,916
|
|
|
1,727
|
|
||||
Gains (losses) related to investment securities, net:
|
|
|
|
|
|
|
|
||||||||
Net gains from sales of investment securities
|
24
|
|
|
15
|
|
|
29
|
|
|
81
|
|
||||
Losses from other-than-temporary impairment
|
(4
|
)
|
|
(25
|
)
|
|
(50
|
)
|
|
(104
|
)
|
||||
Losses not related to credit
|
(2
|
)
|
|
15
|
|
|
23
|
|
|
48
|
|
||||
Gains (losses) related to investment securities, net
|
18
|
|
|
5
|
|
|
2
|
|
|
25
|
|
||||
Total revenue
|
2,356
|
|
|
2,427
|
|
|
7,200
|
|
|
7,279
|
|
||||
Provision for loan losses
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
1
|
|
||||
Expenses:
|
|
|
|
|
|
|
|
||||||||
Compensation and employee benefits
|
916
|
|
|
965
|
|
|
2,922
|
|
|
2,948
|
|
||||
Information systems and communications
|
211
|
|
|
191
|
|
|
610
|
|
|
581
|
|
||||
Transaction processing services
|
170
|
|
|
180
|
|
|
523
|
|
|
553
|
|
||||
Occupancy
|
115
|
|
|
119
|
|
|
349
|
|
|
339
|
|
||||
Claims resolution
|
(362
|
)
|
|
—
|
|
|
(362
|
)
|
|
—
|
|
||||
Provisions for litigation exposure
|
60
|
|
|
—
|
|
|
82
|
|
|
—
|
|
||||
Acquisition and restructuring costs
|
28
|
|
|
85
|
|
|
86
|
|
|
121
|
|
||||
Professional services
|
89
|
|
|
83
|
|
|
266
|
|
|
249
|
|
||||
Amortization of other intangible assets
|
46
|
|
|
50
|
|
|
145
|
|
|
149
|
|
||||
Other
|
142
|
|
|
125
|
|
|
401
|
|
|
334
|
|
||||
Total expenses
|
1,415
|
|
|
1,798
|
|
|
5,022
|
|
|
5,274
|
|
||||
Income before income tax expense
|
941
|
|
|
629
|
|
|
2,179
|
|
|
2,004
|
|
||||
Income tax expense
|
267
|
|
|
74
|
|
|
588
|
|
|
465
|
|
||||
Net income
|
$
|
674
|
|
|
$
|
555
|
|
|
$
|
1,591
|
|
|
$
|
1,539
|
|
Net income available to common shareholders
|
$
|
654
|
|
|
$
|
543
|
|
|
$
|
1,551
|
|
|
$
|
1,511
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per common share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.39
|
|
|
$
|
1.11
|
|
|
$
|
3.23
|
|
|
$
|
3.05
|
|
Diluted
|
1.36
|
|
|
1.10
|
|
|
3.19
|
|
|
3.03
|
|
||||
Average common shares outstanding (in thousands):
|
|
|
|
|
|
|
|
||||||||
Basic
|
472,355
|
|
|
490,840
|
|
|
479,536
|
|
|
495,015
|
|
||||
Diluted
|
480,010
|
|
|
494,780
|
|
|
485,813
|
|
|
498,417
|
|
||||
Cash dividends declared per common share
|
$
|
.24
|
|
|
$
|
.18
|
|
|
$
|
.72
|
|
|
$
|
.54
|
|
|
Three Months Ended September 30,
|
||||||
(In millions)
|
2012
|
|
2011
|
||||
Net income
|
$
|
674
|
|
|
$
|
555
|
|
Other comprehensive income (loss), net of related taxes:
|
|
|
|
||||
Foreign currency translation, net of related taxes of $26 and $31, respectively
|
172
|
|
|
(462
|
)
|
||
Change in net unrealized losses on available-for-sale securities, net of reclassification adjustment and net of related taxes of $326 and $75, respectively
|
543
|
|
|
91
|
|
||
Change in net unrealized losses on available-for-sale securities designated in fair value hedges, net of related taxes of $(1) and $(69), respectively
|
(1
|
)
|
|
(104
|
)
|
||
Other-than-temporary impairment on held-to-maturity securities related to factors other than credit, net of related taxes of $4 for 2012
|
7
|
|
|
—
|
|
||
Change in net unrealized losses on cash flow hedges, net of related taxes of $3 and $1, respectively
|
(5
|
)
|
|
3
|
|
||
Change in minimum pension liability, net of related taxes of $(7) and $0, respectively
|
7
|
|
|
(3
|
)
|
||
Other comprehensive income (loss)
|
723
|
|
|
(475
|
)
|
||
Total comprehensive income
|
$
|
1,397
|
|
|
$
|
80
|
|
|
|
|
|
||||
|
|
|
|
||||
|
Nine Months Ended September 30,
|
||||||
(In millions)
|
2012
|
|
2011
|
||||
Net income
|
$
|
1,591
|
|
|
$
|
1,539
|
|
Other comprehensive income, net of related taxes:
|
|
|
|
||||
Foreign currency translation, net of related taxes of $60 and $(7), respectively
|
19
|
|
|
10
|
|
||
Change in net unrealized losses on available-for-sale securities, net of reclassification adjustment and net of related taxes of $471 and $318, respectively
|
794
|
|
|
449
|
|
||
Change in net unrealized losses on available-for-sale securities designated in fair value hedges, net of related taxes of $9 and $(63), respectively
|
14
|
|
|
(96
|
)
|
||
Other-than-temporary impairment on held-to-maturity securities related to factors other than credit, net of related taxes of $6 and $8, respectively
|
10
|
|
|
13
|
|
||
Change in net unrealized losses on cash flow hedges, net of related taxes of $4 and $2, respectively
|
(1
|
)
|
|
6
|
|
||
Change in minimum pension liability, net of related taxes of $(6) and $23, respectively
|
9
|
|
|
(8
|
)
|
||
Other comprehensive income
|
845
|
|
|
374
|
|
||
Total comprehensive income
|
$
|
2,436
|
|
|
$
|
1,913
|
|
|
September 30,
2012 |
|
December 31,
2011 |
||||
(Dollars in millions, except per share amounts)
|
(Unaudited)
|
|
|
||||
Assets:
|
|
|
|
||||
Cash and due from banks
|
$
|
6,432
|
|
|
$
|
2,193
|
|
Interest-bearing deposits with banks
|
31,583
|
|
|
58,886
|
|
||
Securities purchased under resale agreements
|
8,264
|
|
|
7,045
|
|
||
Trading account assets
|
611
|
|
|
707
|
|
||
Investment securities available for sale
|
107,129
|
|
|
99,832
|
|
||
Investment securities held to maturity (fair value of $8,622 and $9,362)
|
8,360
|
|
|
9,321
|
|
||
Loans and leases (less allowance for losses of $22 and $22)
|
14,024
|
|
|
10,031
|
|
||
Premises and equipment (net of accumulated depreciation of $3,955 and $3,673)
|
1,720
|
|
|
1,747
|
|
||
Accrued income receivable
|
1,933
|
|
|
1,822
|
|
||
Goodwill
|
5,650
|
|
|
5,645
|
|
||
Other intangible assets
|
2,311
|
|
|
2,459
|
|
||
Other assets
|
16,505
|
|
|
17,139
|
|
||
Total assets
|
$
|
204,522
|
|
|
$
|
216,827
|
|
|
|
|
|
||||
Liabilities:
|
|
|
|
||||
Deposits:
|
|
|
|
||||
Noninterest-bearing
|
$
|
40,963
|
|
|
$
|
59,229
|
|
Interest-bearing—U.S.
|
11,107
|
|
|
7,148
|
|
||
Interest-bearing—Non-U.S.
|
94,219
|
|
|
90,910
|
|
||
Total deposits
|
146,289
|
|
|
157,287
|
|
||
Securities sold under repurchase agreements
|
7,933
|
|
|
8,572
|
|
||
Federal funds purchased
|
169
|
|
|
656
|
|
||
Other short-term borrowings
|
5,181
|
|
|
4,766
|
|
||
Accrued expenses and other liabilities
|
17,783
|
|
|
18,017
|
|
||
Long-term debt
|
6,418
|
|
|
8,131
|
|
||
Total liabilities
|
183,773
|
|
|
197,429
|
|
||
Commitments and contingencies (note 6)
|
|
|
|
||||
Shareholders’ equity:
|
|
|
|
||||
Preferred stock, no par, 3,500,000 shares authorized:
|
|
|
|
||||
Series C, 5,000 shares issued and outstanding
|
488
|
|
|
—
|
|
||
Series A, 5,001 shares issued and outstanding
|
—
|
|
|
500
|
|
||
Common stock, $1 par, 750,000,000 shares authorized:
|
|
|
|
||||
503,917,643 and 503,965,849 shares issued
|
504
|
|
|
504
|
|
||
Surplus
|
9,634
|
|
|
9,557
|
|
||
Retained earnings
|
11,392
|
|
|
10,176
|
|
||
Accumulated other comprehensive gain (loss)
|
186
|
|
|
(659
|
)
|
||
Treasury stock, at cost, 35,090,753 and 16,541,985 shares held
|
(1,455
|
)
|
|
(680
|
)
|
||
Total shareholders’ equity
|
20,749
|
|
|
19,398
|
|
||
Total liabilities and shareholders’ equity
|
$
|
204,522
|
|
|
$
|
216,827
|
|
(Dollars in millions, except per share amounts,
shares in thousands)
|
Preferred
Stock
|
|
COMMON STOCK
|
|
Surplus
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Gain (Loss)
|
|
TREASURY STOCK
|
|
Total
|
||||||||||||||||||||
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
||||||||||||||||||||||||||
Balance at December 31, 2010
|
|
|
502,064
|
|
|
$
|
502
|
|
|
$
|
9,356
|
|
|
$
|
8,634
|
|
|
$
|
(689
|
)
|
|
420
|
|
|
$
|
(16
|
)
|
|
$
|
17,787
|
|
||
Net income
|
|
|
|
|
|
|
|
|
1,539
|
|
|
|
|
|
|
|
|
1,539
|
|
||||||||||||||
Other comprehensive income
|
|
|
|
|
|
|
|
|
|
|
374
|
|
|
|
|
|
|
374
|
|
||||||||||||||
Preferred stock issued
|
$
|
500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
500
|
|
|||||||||||||
Cash dividends declared:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Common stock—$.54 per share
|
|
|
|
|
|
|
|
|
(271
|
)
|
|
|
|
|
|
|
|
(271
|
)
|
||||||||||||||
Preferred stock
|
|
|
|
|
|
|
|
|
(13
|
)
|
|
|
|
|
|
|
|
(13
|
)
|
||||||||||||||
Common stock acquired
|
|
|
|
|
|
|
|
|
|
|
|
|
10,700
|
|
|
(450
|
)
|
|
(450
|
)
|
|||||||||||||
Common stock awards and options exercised, including related taxes of $(13)
|
|
|
1,937
|
|
|
2
|
|
|
183
|
|
|
|
|
|
|
(197
|
)
|
|
10
|
|
|
195
|
|
||||||||||
Other
|
|
|
|
|
|
|
(11
|
)
|
|
|
|
|
|
(4
|
)
|
|
1
|
|
|
(10
|
)
|
||||||||||||
Balance at September 30, 2011
|
$
|
500
|
|
|
504,001
|
|
|
$
|
504
|
|
|
$
|
9,528
|
|
|
$
|
9,889
|
|
|
$
|
(315
|
)
|
|
10,919
|
|
|
$
|
(455
|
)
|
|
$
|
19,651
|
|
Balance at December 31, 2011
|
$
|
500
|
|
|
503,966
|
|
|
$
|
504
|
|
|
$
|
9,557
|
|
|
$
|
10,176
|
|
|
$
|
(659
|
)
|
|
16,542
|
|
|
$
|
(680
|
)
|
|
$
|
19,398
|
|
Net income
|
|
|
|
|
|
|
|
|
1,591
|
|
|
|
|
|
|
|
|
1,591
|
|
||||||||||||||
Other comprehensive income
|
|
|
|
|
|
|
|
|
|
|
845
|
|
|
|
|
|
|
845
|
|
||||||||||||||
Commitment to redeem preferred stock
|
(500
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(500
|
)
|
||||||||||||||
Preferred stock issued
|
488
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
488
|
|
||||||||||||||
Cash dividends declared:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Common stock—$.72 per share
|
|
|
|
|
|
|
|
|
(346
|
)
|
|
|
|
|
|
|
|
(346
|
)
|
||||||||||||||
Preferred stock
|
|
|
|
|
|
|
|
|
(29
|
)
|
|
|
|
|
|
|
|
(29
|
)
|
||||||||||||||
Common stock acquired
|
|
|
|
|
|
|
|
|
|
|
|
|
22,496
|
|
|
(960
|
)
|
|
(960
|
)
|
|||||||||||||
Common stock awards and options exercised, including related taxes of $(8)
|
|
|
(48
|
)
|
|
—
|
|
|
75
|
|
|
|
|
|
|
(3,938
|
)
|
|
185
|
|
|
260
|
|
||||||||||
Other
|
|
|
|
|
|
|
2
|
|
|
|
|
|
|
(9
|
)
|
|
—
|
|
|
2
|
|
||||||||||||
Balance at September 30, 2012
|
$
|
488
|
|
|
503,918
|
|
|
$
|
504
|
|
|
$
|
9,634
|
|
|
$
|
11,392
|
|
|
$
|
186
|
|
|
35,091
|
|
|
$
|
(1,455
|
)
|
|
$
|
20,749
|
|
|
Nine Months Ended September 30,
|
||||||
(In millions)
|
2012
|
|
2011
|
||||
Operating Activities:
|
|
|
|
||||
Net income
|
$
|
1,591
|
|
|
$
|
1,539
|
|
Adjustments to reconcile net income to net cash used in operating activities:
|
|
|
|
||||
Claims resolution
|
(362
|
)
|
|
—
|
|
||
Deferred income tax benefit
|
(44
|
)
|
|
(96
|
)
|
||
Amortization of other intangible assets
|
145
|
|
|
149
|
|
||
Other non-cash adjustments for depreciation, amortization and accretion
|
279
|
|
|
116
|
|
||
Gains related to investment securities, net
|
(2
|
)
|
|
(25
|
)
|
||
Change in trading account assets, net
|
96
|
|
|
(1,297
|
)
|
||
Change in accrued income receivable
|
(111
|
)
|
|
(199
|
)
|
||
Change in collateral deposits, net
|
(1,216
|
)
|
|
(1,919
|
)
|
||
Change in unrealized (gains) losses on foreign exchange derivatives, net
|
483
|
|
|
(169
|
)
|
||
Change in other assets, net
|
26
|
|
|
(1,170
|
)
|
||
Change in trading liabilities, net
|
—
|
|
|
785
|
|
||
Change in accrued expenses and other liabilities, net
|
(1,341
|
)
|
|
2,183
|
|
||
Other, net
|
52
|
|
|
328
|
|
||
Net cash (used in) provided by operating activities
|
(404
|
)
|
|
225
|
|
||
Investing Activities:
|
|
|
|
||||
Net (increase) decrease in interest-bearing deposits with banks
|
27,303
|
|
|
(14,250
|
)
|
||
Net increase in securities purchased under resale agreements
|
(1,219
|
)
|
|
(3,130
|
)
|
||
Proceeds from sales of available-for-sale securities
|
4,209
|
|
|
11,056
|
|
||
Proceeds from maturities of available-for-sale securities
|
33,047
|
|
|
33,705
|
|
||
Purchases of available-for-sale securities
|
(42,152
|
)
|
|
(58,901
|
)
|
||
Proceeds from maturities of held-to-maturity securities
|
2,561
|
|
|
2,779
|
|
||
Purchases of held-to-maturity securities
|
(7
|
)
|
|
(455
|
)
|
||
Net increase in loans
|
(4,042
|
)
|
|
(52
|
)
|
||
Business acquisitions, net of cash acquired
|
—
|
|
|
(77
|
)
|
||
Purchases of equity investments and other long-term assets
|
(69
|
)
|
|
(69
|
)
|
||
Purchases of premises and equipment
|
(254
|
)
|
|
(209
|
)
|
||
Other, net
|
105
|
|
|
280
|
|
||
Net cash (used in) provided by investing activities
|
19,482
|
|
|
(29,323
|
)
|
||
Financing Activities:
|
|
|
|
||||
Net increase in time deposits
|
2,143
|
|
|
566
|
|
||
Net increase (decrease) in all other deposits
|
(13,141
|
)
|
|
36,087
|
|
||
Net decrease in short-term borrowings
|
(1,211
|
)
|
|
(722
|
)
|
||
Proceeds from issuance of long-term debt, net of issuance costs
|
—
|
|
|
1,986
|
|
||
Payments for long-term debt and obligations under capital leases
|
(1,768
|
)
|
|
(2,474
|
)
|
||
Proceeds from issuance of preferred stock
|
488
|
|
|
500
|
|
||
Proceeds from exercises of common stock options
|
39
|
|
|
40
|
|
||
Purchases of common stock
|
(960
|
)
|
|
(450
|
)
|
||
Repurchases of common stock for employee tax withholding
|
(88
|
)
|
|
(60
|
)
|
||
Payments for cash dividends
|
(341
|
)
|
|
(199
|
)
|
||
Net cash (used in) provided by financing activities
|
(14,839
|
)
|
|
35,274
|
|
||
Net increase
|
4,239
|
|
|
6,176
|
|
||
Cash and due from banks at beginning of period
|
2,193
|
|
|
3,311
|
|
||
Cash and due from banks at end of period
|
$
|
6,432
|
|
|
$
|
9,487
|
|
|
September 30, 2012
|
|
December 31, 2011
|
||||||||||||||||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
|
|
Fair
Value
|
|
Amortized
Cost
|
|
Gross
Unrealized
|
|
Fair
Value
|
||||||||||||||||||||
(In millions)
|
Gains
|
|
Losses
|
|
Gains
|
|
Losses
|
|
|||||||||||||||||||||||
Available for sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
U.S. Treasury and federal agencies:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Direct obligations
|
$
|
852
|
|
|
$
|
19
|
|
|
$
|
1
|
|
|
$
|
870
|
|
|
$
|
2,798
|
|
|
$
|
39
|
|
|
$
|
1
|
|
|
$
|
2,836
|
|
Mortgage-backed securities
|
31,355
|
|
|
672
|
|
|
24
|
|
|
32,003
|
|
|
29,511
|
|
|
538
|
|
|
28
|
|
|
30,021
|
|
||||||||
Asset-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Student loans
(1)
|
17,039
|
|
|
89
|
|
|
591
|
|
|
16,537
|
|
|
17,187
|
|
|
69
|
|
|
711
|
|
|
16,545
|
|
||||||||
Credit cards
|
9,906
|
|
|
64
|
|
|
4
|
|
|
9,966
|
|
|
10,448
|
|
|
53
|
|
|
14
|
|
|
10,487
|
|
||||||||
Sub-prime
|
1,618
|
|
|
3
|
|
|
242
|
|
|
1,379
|
|
|
1,849
|
|
|
2
|
|
|
447
|
|
|
1,404
|
|
||||||||
Other
|
4,067
|
|
|
145
|
|
|
86
|
|
|
4,126
|
|
|
3,421
|
|
|
169
|
|
|
125
|
|
|
3,465
|
|
||||||||
Total asset-backed securities
|
32,630
|
|
|
301
|
|
|
923
|
|
|
32,008
|
|
|
32,905
|
|
|
293
|
|
|
1,297
|
|
|
31,901
|
|
||||||||
Non-U.S. debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Mortgage-backed securities
|
10,770
|
|
|
304
|
|
|
30
|
|
|
11,044
|
|
|
10,890
|
|
|
92
|
|
|
107
|
|
|
10,875
|
|
||||||||
Asset-backed securities
|
5,896
|
|
|
28
|
|
|
4
|
|
|
5,920
|
|
|
4,318
|
|
|
2
|
|
|
17
|
|
|
4,303
|
|
||||||||
Government securities
|
2,985
|
|
|
1
|
|
|
—
|
|
|
2,986
|
|
|
1,671
|
|
|
—
|
|
|
—
|
|
|
1,671
|
|
||||||||
Other
|
3,955
|
|
|
80
|
|
|
1
|
|
|
4,034
|
|
|
2,797
|
|
|
41
|
|
|
13
|
|
|
2,825
|
|
||||||||
Total non-U.S. debt securities
|
23,606
|
|
|
413
|
|
|
35
|
|
|
23,984
|
|
|
19,676
|
|
|
135
|
|
|
137
|
|
|
19,674
|
|
||||||||
State and political subdivisions
|
7,127
|
|
|
258
|
|
|
81
|
|
|
7,304
|
|
|
6,924
|
|
|
244
|
|
|
121
|
|
|
7,047
|
|
||||||||
Collateralized mortgage obligations
|
4,703
|
|
|
160
|
|
|
18
|
|
|
4,845
|
|
|
3,971
|
|
|
62
|
|
|
53
|
|
|
3,980
|
|
||||||||
Other U.S. debt securities
|
4,861
|
|
|
251
|
|
|
8
|
|
|
5,104
|
|
|
3,471
|
|
|
159
|
|
|
15
|
|
|
3,615
|
|
||||||||
U.S. equity securities
|
877
|
|
|
4
|
|
|
—
|
|
|
881
|
|
|
639
|
|
|
1
|
|
|
—
|
|
|
640
|
|
||||||||
Non-U.S. equity securities
|
130
|
|
|
—
|
|
|
—
|
|
|
130
|
|
|
118
|
|
|
—
|
|
|
—
|
|
|
118
|
|
||||||||
Total
|
$
|
106,141
|
|
|
$
|
2,078
|
|
|
$
|
1,090
|
|
|
$
|
107,129
|
|
|
$
|
100,013
|
|
|
$
|
1,471
|
|
|
$
|
1,652
|
|
|
$
|
99,832
|
|
Held to maturity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
U.S. Treasury and federal agencies:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Direct obligations
|
$
|
1,500
|
|
|
|
|
|
|
$
|
1,500
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mortgage-backed securities
|
180
|
|
|
$
|
13
|
|
|
|
|
193
|
|
|
$
|
265
|
|
|
$
|
18
|
|
|
|
|
$
|
283
|
|
||||||
Asset-backed securities
|
8
|
|
|
—
|
|
|
|
|
|
8
|
|
|
31
|
|
|
—
|
|
|
$
|
2
|
|
|
29
|
|
|||||||
Non-U.S. debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Mortgage-backed securities
|
3,409
|
|
|
71
|
|
|
$
|
93
|
|
|
3,387
|
|
|
4,973
|
|
|
87
|
|
|
224
|
|
|
4,836
|
|
|||||||
Asset-backed securities
|
441
|
|
|
14
|
|
|
2
|
|
|
453
|
|
|
436
|
|
|
16
|
|
|
3
|
|
|
449
|
|
||||||||
Government securities
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
||||||||
Other
|
165
|
|
|
—
|
|
|
3
|
|
|
162
|
|
|
172
|
|
|
—
|
|
|
17
|
|
|
155
|
|
||||||||
Total non-U.S. debt securities
|
4,018
|
|
|
85
|
|
|
98
|
|
|
4,005
|
|
|
5,584
|
|
|
103
|
|
|
244
|
|
|
5,443
|
|
||||||||
State and political subdivisions
|
80
|
|
|
2
|
|
|
—
|
|
|
82
|
|
|
107
|
|
|
3
|
|
|
—
|
|
|
110
|
|
||||||||
Collateralized mortgage obligations
|
2,574
|
|
|
272
|
|
|
12
|
|
|
2,834
|
|
|
3,334
|
|
|
220
|
|
|
57
|
|
|
3,497
|
|
||||||||
Total
|
$
|
8,360
|
|
|
$
|
372
|
|
|
$
|
110
|
|
|
$
|
8,622
|
|
|
$
|
9,321
|
|
|
$
|
344
|
|
|
$
|
303
|
|
|
$
|
9,362
|
|
|
|
|
|
(1)
|
Substantially composed of securities guaranteed by the federal government with respect to at least
97%
of defaulted
|
|
Less than 12 months
|
|
12 months or longer
|
|
Total
|
||||||||||||||||||
September 30, 2012
|
Fair
Value
|
|
Gross
Unrealized
Losses
|
|
Fair
Value
|
|
Gross
Unrealized
Losses
|
|
Fair
Value
|
|
Gross
Unrealized
Losses
|
||||||||||||
(In millions)
|
|
|
|
|
|
||||||||||||||||||
Available for sale:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. Treasury and federal agencies:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Direct obligations
|
|
|
|
|
|
$
|
140
|
|
|
$
|
1
|
|
|
$
|
140
|
|
|
$
|
1
|
|
|||
Mortgage-backed securities
|
$
|
3,440
|
|
|
$
|
21
|
|
|
570
|
|
|
3
|
|
|
4,010
|
|
|
24
|
|
||||
Asset-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Student loans
|
619
|
|
|
4
|
|
|
11,012
|
|
|
587
|
|
|
11,631
|
|
|
591
|
|
||||||
Credit cards
|
660
|
|
|
4
|
|
|
109
|
|
|
—
|
|
|
769
|
|
|
4
|
|
||||||
Sub-prime
|
—
|
|
|
—
|
|
|
1,341
|
|
|
242
|
|
|
1,341
|
|
|
242
|
|
||||||
Other
|
769
|
|
|
21
|
|
|
1,072
|
|
|
65
|
|
|
1,841
|
|
|
86
|
|
||||||
Total asset-backed securities
|
2,048
|
|
|
29
|
|
|
13,534
|
|
|
894
|
|
|
15,582
|
|
|
923
|
|
||||||
Non-U.S. debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mortgage-backed securities
|
146
|
|
|
1
|
|
|
714
|
|
|
29
|
|
|
860
|
|
|
30
|
|
||||||
Asset-backed securities
|
467
|
|
|
1
|
|
|
65
|
|
|
3
|
|
|
532
|
|
|
4
|
|
||||||
Other
|
209
|
|
|
1
|
|
|
25
|
|
|
—
|
|
|
234
|
|
|
1
|
|
||||||
Total non-U.S. debt securities
|
822
|
|
|
3
|
|
|
804
|
|
|
32
|
|
|
1,626
|
|
|
35
|
|
||||||
State and political subdivisions
|
163
|
|
|
1
|
|
|
1,371
|
|
|
80
|
|
|
1,534
|
|
|
81
|
|
||||||
Collateralized mortgage obligations
|
245
|
|
|
2
|
|
|
633
|
|
|
16
|
|
|
878
|
|
|
18
|
|
||||||
Other U.S. debt securities
|
—
|
|
|
—
|
|
|
32
|
|
|
8
|
|
|
32
|
|
|
8
|
|
||||||
Total
|
$
|
6,718
|
|
|
$
|
56
|
|
|
$
|
17,084
|
|
|
$
|
1,034
|
|
|
$
|
23,802
|
|
|
$
|
1,090
|
|
Held to maturity:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Non-U.S. debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mortgage-backed securities
|
$
|
178
|
|
|
$
|
2
|
|
|
$
|
973
|
|
|
$
|
91
|
|
|
$
|
1,151
|
|
|
$
|
93
|
|
Asset-backed securities
|
—
|
|
|
—
|
|
|
81
|
|
|
2
|
|
|
81
|
|
|
2
|
|
||||||
Other
|
—
|
|
|
—
|
|
|
151
|
|
|
3
|
|
|
151
|
|
|
3
|
|
||||||
Total non-U.S. debt securities
|
178
|
|
|
2
|
|
|
1,205
|
|
|
96
|
|
|
1,383
|
|
|
98
|
|
||||||
Collateralized mortgage obligations
|
—
|
|
|
—
|
|
|
155
|
|
|
12
|
|
|
155
|
|
|
12
|
|
||||||
Total
|
$
|
178
|
|
|
$
|
2
|
|
|
$
|
1,360
|
|
|
$
|
108
|
|
|
$
|
1,538
|
|
|
$
|
110
|
|
|
Less than 12 months
|
|
12 months or longer
|
|
Total
|
||||||||||||||||||
December 31, 2011
|
Fair
Value
|
|
Gross
Unrealized
Losses
|
|
Fair
Value
|
|
Gross
Unrealized
Losses
|
|
Fair
Value
|
|
Gross
Unrealized
Losses
|
||||||||||||
(In millions)
|
|
|
|
|
|
||||||||||||||||||
Available for sale:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. Treasury and federal agencies:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Direct obligations
|
$
|
1,373
|
|
|
$
|
1
|
|
|
|
|
|
|
$
|
1,373
|
|
|
$
|
1
|
|
||||
Mortgage-backed securities
|
4,714
|
|
|
26
|
|
|
$
|
370
|
|
|
$
|
2
|
|
|
5,084
|
|
|
28
|
|
||||
Asset-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Student loans
|
2,642
|
|
|
23
|
|
|
10,706
|
|
|
688
|
|
|
13,348
|
|
|
711
|
|
||||||
Credit cards
|
2,581
|
|
|
6
|
|
|
1,461
|
|
|
8
|
|
|
4,042
|
|
|
14
|
|
||||||
Sub-prime
|
16
|
|
|
1
|
|
|
1,360
|
|
|
446
|
|
|
1,376
|
|
|
447
|
|
||||||
Other
|
1,482
|
|
|
19
|
|
|
1,122
|
|
|
106
|
|
|
2,604
|
|
|
125
|
|
||||||
Total asset-backed securities
|
6,721
|
|
|
49
|
|
|
14,649
|
|
|
1,248
|
|
|
21,370
|
|
|
1,297
|
|
||||||
Non-U.S. debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mortgage-backed securities
|
6,069
|
|
|
55
|
|
|
1,151
|
|
|
52
|
|
|
7,220
|
|
|
107
|
|
||||||
Asset-backed securities
|
2,205
|
|
|
14
|
|
|
108
|
|
|
3
|
|
|
2,313
|
|
|
17
|
|
||||||
Other
|
1,543
|
|
|
13
|
|
|
—
|
|
|
—
|
|
|
1,543
|
|
|
13
|
|
||||||
Total non-U.S. debt securities
|
9,817
|
|
|
82
|
|
|
1,259
|
|
|
55
|
|
|
11,076
|
|
|
137
|
|
||||||
State and political subdivisions
|
171
|
|
|
3
|
|
|
1,446
|
|
|
118
|
|
|
1,617
|
|
|
121
|
|
||||||
Collateralized mortgage obligations
|
2,024
|
|
|
43
|
|
|
68
|
|
|
10
|
|
|
2,092
|
|
|
53
|
|
||||||
Other U.S. debt securities
|
220
|
|
|
2
|
|
|
57
|
|
|
13
|
|
|
277
|
|
|
15
|
|
||||||
Total
|
$
|
25,040
|
|
|
$
|
206
|
|
|
$
|
17,849
|
|
|
$
|
1,446
|
|
|
$
|
42,889
|
|
|
$
|
1,652
|
|
Held to maturity:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Asset-backed securities
|
|
|
|
|
$
|
29
|
|
|
$
|
2
|
|
|
$
|
29
|
|
|
$
|
2
|
|
||||
Non-U.S. debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mortgage-backed securities
|
$
|
341
|
|
|
$
|
6
|
|
|
1,382
|
|
|
218
|
|
|
1,723
|
|
|
224
|
|
||||
Asset-backed securities
|
9
|
|
|
1
|
|
|
70
|
|
|
2
|
|
|
79
|
|
|
3
|
|
||||||
Other
|
—
|
|
|
—
|
|
|
138
|
|
|
17
|
|
|
138
|
|
|
17
|
|
||||||
Total non-U.S. debt securities
|
350
|
|
|
7
|
|
|
1,590
|
|
|
237
|
|
|
1,940
|
|
|
244
|
|
||||||
Collateralized mortgage obligations
|
649
|
|
|
32
|
|
|
231
|
|
|
25
|
|
|
880
|
|
|
57
|
|
||||||
Total
|
$
|
999
|
|
|
$
|
39
|
|
|
$
|
1,850
|
|
|
$
|
264
|
|
|
$
|
2,849
|
|
|
$
|
303
|
|
(In millions)
|
Under 1
Year
|
|
1 to 5
Years
|
|
6 to 10
Years
|
|
Over 10
Years
|
||||||||
Available for sale:
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury and federal agencies:
|
|
|
|
|
|
|
|
||||||||
Direct obligations
|
|
|
$
|
52
|
|
|
$
|
60
|
|
|
$
|
758
|
|
||
Mortgage-backed securities
|
$
|
13
|
|
|
1,447
|
|
|
8,858
|
|
|
21,685
|
|
|||
Asset-backed securities:
|
|
|
|
|
|
|
|
||||||||
Student loans
|
316
|
|
|
6,573
|
|
|
6,261
|
|
|
3,387
|
|
||||
Credit cards
|
986
|
|
|
6,432
|
|
|
2,548
|
|
|
—
|
|
||||
Sub-prime
|
109
|
|
|
52
|
|
|
4
|
|
|
1,214
|
|
||||
Other
|
76
|
|
|
2,268
|
|
|
1,479
|
|
|
303
|
|
||||
Total asset-backed securities
|
1,487
|
|
|
15,325
|
|
|
10,292
|
|
|
4,904
|
|
||||
Non-U.S. debt securities:
|
|
|
|
|
|
|
|
||||||||
Mortgage-backed securities
|
159
|
|
|
4,602
|
|
|
523
|
|
|
5,760
|
|
||||
Asset-backed securities
|
313
|
|
|
4,198
|
|
|
1,131
|
|
|
278
|
|
||||
Government securities
|
1,726
|
|
|
1,260
|
|
|
—
|
|
|
—
|
|
||||
Other
|
1,475
|
|
|
2,178
|
|
|
381
|
|
|
—
|
|
||||
Total non-U.S. debt securities
|
3,673
|
|
|
12,238
|
|
|
2,035
|
|
|
6,038
|
|
||||
State and political subdivisions
|
640
|
|
|
3,086
|
|
|
2,835
|
|
|
743
|
|
||||
Collateralized mortgage obligations
|
151
|
|
|
2,412
|
|
|
1,064
|
|
|
1,218
|
|
||||
Other U.S. debt securities
|
315
|
|
|
3,556
|
|
|
1,202
|
|
|
31
|
|
||||
Total
|
$
|
6,279
|
|
|
$
|
38,116
|
|
|
$
|
26,346
|
|
|
$
|
35,377
|
|
Held to maturity:
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury and federal agencies:
|
|
|
|
|
|
|
|
||||||||
Direct obligations
|
|
|
|
|
|
|
$
|
1,500
|
|
||||||
Mortgage-backed securities
|
|
|
$
|
43
|
|
|
$
|
36
|
|
|
101
|
|
|||
Asset-backed securities
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|||||
Non-U.S. debt securities:
|
|
|
|
|
|
|
|
||||||||
Mortgage-backed securities
|
$
|
256
|
|
|
—
|
|
|
—
|
|
|
3,153
|
|
|||
Asset-backed securities
|
75
|
|
|
320
|
|
|
46
|
|
|
—
|
|
||||
Government securities
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Other
|
—
|
|
|
154
|
|
|
—
|
|
|
11
|
|
||||
Total non-U.S. debt securities
|
334
|
|
|
474
|
|
|
46
|
|
|
3,164
|
|
||||
State and political subdivisions
|
50
|
|
|
30
|
|
|
—
|
|
|
—
|
|
||||
Collateralized mortgage obligations
|
382
|
|
|
1,274
|
|
|
119
|
|
|
799
|
|
||||
Total
|
$
|
766
|
|
|
$
|
1,821
|
|
|
$
|
201
|
|
|
$
|
5,572
|
|
|
Three Months Ended September 30
|
|
Nine Months Ended September 30,
|
||||||||||||
(In millions)
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Gross realized gains from sales of available-for-sale securities
|
$
|
24
|
|
|
$
|
24
|
|
|
$
|
75
|
|
|
$
|
93
|
|
Gross realized losses from sales of available-for-sale securities
(1)
|
—
|
|
|
(9
|
)
|
|
(46
|
)
|
|
(12
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Gross losses from other-than-temporary impairment
|
(4
|
)
|
|
(25
|
)
|
|
(50
|
)
|
|
(104
|
)
|
||||
Losses not related to credit
(2)
|
(2
|
)
|
|
15
|
|
|
23
|
|
|
48
|
|
||||
Net impairment losses
|
(6
|
)
|
|
(10
|
)
|
|
(27
|
)
|
|
(56
|
)
|
||||
Gains (losses) related to investment securities, net
|
$
|
18
|
|
|
$
|
5
|
|
|
$
|
2
|
|
|
$
|
25
|
|
|
|
|
|
|
|
|
|
||||||||
Impairment associated with expected credit losses
|
$
|
(1
|
)
|
|
$
|
(7
|
)
|
|
$
|
(14
|
)
|
|
$
|
(36
|
)
|
Impairment associated with management's intent to sell the impaired securities prior to their recovery in value
|
—
|
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
||||
Impairment associated with adverse changes in timing of expected future cash flows
|
(5
|
)
|
|
(3
|
)
|
|
(13
|
)
|
|
(12
|
)
|
||||
Net impairment losses
|
$
|
(6
|
)
|
|
$
|
(10
|
)
|
|
$
|
(27
|
)
|
|
$
|
(56
|
)
|
|
|
|
|
|
|
Nine Months Ended September 30,
|
||||||
(In millions)
|
2012
|
|
2011
|
||||
Beginning balance
|
$
|
113
|
|
|
$
|
63
|
|
Plus losses for which other-than-temporary impairment was not previously recognized
|
2
|
|
|
9
|
|
||
Plus losses for which other-than-temporary impairment was previously recognized
|
25
|
|
|
39
|
|
||
Less previously recognized losses related to securities sold
|
(21
|
)
|
|
(13
|
)
|
||
Less losses related to securities intended or required to be sold
|
—
|
|
|
(2
|
)
|
||
Ending balance
|
$
|
119
|
|
|
$
|
96
|
|
•
|
the identification and evaluation of securities that have indications of potential other-than-temporary impairment, such as issuer-specific concerns, including deteriorating financial condition or bankruptcy;
|
•
|
the analysis of expected future cash flows of securities, based on quantitative and qualitative factors;
|
•
|
the analysis of the collectibility of those future cash flows, including information about past events, current conditions and reasonable and supportable forecasts;
|
•
|
the analysis of the underlying collateral for mortgage- and asset-backed securities;
|
•
|
the analysis of individual impaired securities, including consideration of the length of time the security has been in an unrealized loss position, the anticipated recovery period, and the magnitude of the overall price decline;
|
•
|
discussion and evaluation of factors or triggers that could cause individual securities to be deemed other-than- temporarily impaired and those that would not support other-than-temporary impairment; and
|
•
|
documentation of the results of these analyses.
|
•
|
the length of time the security has been impaired;
|
•
|
the severity of the impairment;
|
•
|
the cause of the impairment and the financial condition and near-term prospects of the issuer;
|
•
|
activity in the market with respect to the issuer's securities, which may indicate adverse credit conditions; and
|
•
|
our intention not to sell, and the likelihood that we will not be required to sell, the security for a period of time sufficient to allow for recovery in value.
|
(In millions)
|
September 30,
2012 |
|
December 31,
2011 |
||||
Institutional:
|
|
|
|
||||
Investment funds:
|
|
|
|
||||
U.S.
|
$
|
9,583
|
|
|
$
|
5,592
|
|
Non-U.S.
|
1,129
|
|
|
796
|
|
||
Commercial and financial:
|
|
|
|
||||
U.S.
|
648
|
|
|
563
|
|
||
Non-U.S.
|
597
|
|
|
453
|
|
||
Purchased receivables:
|
|
|
|
||||
U.S.
|
319
|
|
|
563
|
|
||
Non-U.S.
|
173
|
|
|
372
|
|
||
Lease financing:
|
|
|
|
||||
U.S.
|
381
|
|
|
397
|
|
||
Non-U.S.
|
798
|
|
|
857
|
|
||
Total institutional
|
13,628
|
|
|
9,593
|
|
||
Commercial real estate:
|
|
|
|
||||
U.S.
|
418
|
|
|
460
|
|
||
Total loans and leases
|
14,046
|
|
|
10,053
|
|
||
Allowance for loan losses
|
(22
|
)
|
|
(22
|
)
|
||
Loans and leases, net of allowance for loan losses
|
$
|
14,024
|
|
|
$
|
10,031
|
|
|
Institutional
|
|
Commercial Real Estate
|
|
|
||||||||||||||||||||||||||
September 30, 2012
|
Investment
Funds
|
|
Commercial
and
Financial
|
|
Purchased
Receivables
|
|
Lease
Financing
|
|
Property
Development
|
|
Other
Acquired
Credit-
Impaired
|
|
Other
|
|
Total
Loans and
Leases
|
||||||||||||||||
(In millions)
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Investment grade
|
$
|
10,374
|
|
|
$
|
1,004
|
|
|
$
|
492
|
|
|
$
|
1,104
|
|
|
|
|
|
|
|
|
$
|
29
|
|
|
$
|
13,003
|
|
||
Speculative
|
338
|
|
|
241
|
|
|
—
|
|
|
75
|
|
|
$
|
379
|
|
|
$
|
—
|
|
|
5
|
|
|
1,038
|
|
||||||
Doubtful
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
||||||||
Total
|
$
|
10,712
|
|
|
$
|
1,245
|
|
|
$
|
492
|
|
|
$
|
1,179
|
|
|
$
|
379
|
|
|
$
|
5
|
|
|
$
|
34
|
|
|
$
|
14,046
|
|
|
Institutional
|
|
Commercial Real Estate
|
|
|
||||||||||||||||||||||||||
December 31, 2011
|
Investment
Funds
|
|
Commercial
and
Financial
|
|
Purchased
Receivables
|
|
Lease
Financing
|
|
Property
Development
|
|
Other
Acquired
Credit-
Impaired
|
|
Other
|
|
Total
Loans and
Leases
|
||||||||||||||||
(In millions)
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Investment grade
|
$
|
6,341
|
|
|
$
|
592
|
|
|
$
|
935
|
|
|
$
|
1,194
|
|
|
$
|
1
|
|
|
$
|
3
|
|
|
$
|
36
|
|
|
$
|
9,102
|
|
Speculative
|
47
|
|
|
424
|
|
|
—
|
|
|
60
|
|
|
379
|
|
|
31
|
|
|
5
|
|
|
946
|
|
||||||||
Doubtful
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
||||||||
Total
|
$
|
6,388
|
|
|
$
|
1,016
|
|
|
$
|
935
|
|
|
$
|
1,254
|
|
|
$
|
380
|
|
|
$
|
39
|
|
|
$
|
41
|
|
|
$
|
10,053
|
|
|
Institutional
|
|
Commercial Real Estate
|
|
Total Loans and Leases
|
||||||||||||||||||
(In millions)
|
September 30,
2012 |
|
December 31,
2011 |
|
September 30,
2012 |
|
December 31,
2011 |
|
September 30,
2012 |
|
December 31,
2011 |
||||||||||||
Loans and leases:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Individually evaluated for impairment
|
$
|
172
|
|
|
$
|
56
|
|
|
$
|
413
|
|
|
$
|
421
|
|
|
$
|
585
|
|
|
$
|
477
|
|
Collectively evaluated for impairment
|
13,456
|
|
|
9,537
|
|
|
—
|
|
|
—
|
|
|
13,456
|
|
|
9,537
|
|
||||||
Loans acquired with deteriorated credit quality
|
—
|
|
|
—
|
|
|
5
|
|
|
39
|
|
|
5
|
|
|
39
|
|
||||||
Total
|
$
|
13,628
|
|
|
$
|
9,593
|
|
|
$
|
418
|
|
|
$
|
460
|
|
|
$
|
14,046
|
|
|
$
|
10,053
|
|
|
September 30, 2012
|
|
December 31, 2011
|
||||||||||||||||||
(In millions)
|
Recorded
Investment
|
|
Unpaid
Principal
Balance
|
|
Related
Allowance
(1)
|
|
Recorded
Investment
|
|
Unpaid
Principal
Balance
|
|
Related
Allowance
(1)
|
||||||||||
With no related allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
CRE—property development
|
$
|
199
|
|
|
$
|
226
|
|
|
|
|
$
|
199
|
|
|
$
|
227
|
|
|
|
||
CRE—property development—acquired credit-impaired
|
—
|
|
|
34
|
|
|
|
|
—
|
|
|
34
|
|
|
|
||||||
CRE—other—acquired credit-impaired
|
5
|
|
|
66
|
|
|
|
|
8
|
|
|
69
|
|
|
|
||||||
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
CRE—other—acquired credit-impaired
|
—
|
|
|
—
|
|
|
|
|
31
|
|
|
37
|
|
|
|
||||||
Total CRE
|
$
|
204
|
|
|
$
|
326
|
|
|
—
|
|
|
$
|
238
|
|
|
$
|
367
|
|
|
—
|
|
|
|
|
|
(1)
|
As of both
September 30, 2012
and
December 31, 2011
, we maintained an allowance for loan losses of
$22 million
associated with loans and leases that were not impaired.
|
|
|
Average Recorded Investment
|
|
Interest Revenue Recognized
|
|
Average Recorded Investment
|
|
Interest Revenue Recognized
|
||||||||||||||||||||||||
|
|
Three Months Ended September 30,
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||
(In millions)
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||||||||||
With no related allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
CRE—property development
|
|
$
|
199
|
|
|
$
|
274
|
|
|
$
|
4
|
|
|
$
|
4
|
|
|
$
|
199
|
|
|
$
|
280
|
|
|
$
|
12
|
|
|
$
|
12
|
|
CRE—property development—acquired credit-impaired
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
||||||||
CRE—other—acquired credit-impaired
|
|
5
|
|
|
23
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
46
|
|
|
—
|
|
|
—
|
|
||||||||
CRE—other
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
1
|
|
||||||||
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
CRE—other—acquired credit-impaired
|
|
—
|
|
|
31
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
31
|
|
|
—
|
|
|
1
|
|
||||||||
CRE—other
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
||||||||
Total CRE
|
|
$
|
204
|
|
|
$
|
338
|
|
|
$
|
4
|
|
|
$
|
4
|
|
|
$
|
216
|
|
|
$
|
377
|
|
|
$
|
12
|
|
|
$
|
14
|
|
|
Three Months Ended September 30,
|
|||||||||||||||||||||
|
2012
|
|
2011
|
|||||||||||||||||||
(In millions)
|
Institutional
|
|
Commercial
Real Estate
|
|
Total Loans
and Leases
|
|
Institutional
|
|
Commercial
Real Estate
|
|
Total Loans
and Leases
|
|||||||||||
Allowance for loan losses:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Beginning balance
|
$
|
22
|
|
|
|
|
|
$
|
22
|
|
|
$
|
22
|
|
|
$
|
32
|
|
|
$
|
54
|
|
Charge-offs
|
—
|
|
|
|
|
|
—
|
|
|
—
|
|
|
(32
|
)
|
|
(32
|
)
|
|||||
Provisions
|
—
|
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Recoveries
|
—
|
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Ending balance
|
$
|
22
|
|
|
—
|
|
|
$
|
22
|
|
|
$
|
22
|
|
|
$
|
—
|
|
|
$
|
22
|
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||
|
2012
|
|
2011
|
||||||||||||||||||||
(In millions)
|
Institutional
|
|
Commercial
Real Estate |
|
Total Loans
and Leases |
|
Institutional
|
|
Commercial
Real Estate |
|
Total Loans
and Leases |
||||||||||||
Allowance for loan losses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Beginning balance
|
$
|
22
|
|
|
|
|
$
|
22
|
|
|
$
|
31
|
|
|
$
|
69
|
|
|
$
|
100
|
|
||
Charge-offs
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
(79
|
)
|
|
(79
|
)
|
|||||||
Provisions
|
—
|
|
|
$
|
(1
|
)
|
|
(1
|
)
|
|
(9
|
)
|
|
10
|
|
|
1
|
|
|||||
Recoveries
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Ending balance
|
$
|
22
|
|
|
$
|
—
|
|
|
$
|
22
|
|
|
$
|
22
|
|
|
$
|
—
|
|
|
$
|
22
|
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||
|
2012
|
|
2011
|
||||||||||||||||||||
(In millions)
|
Investment
Servicing
|
|
Investment
Management
|
|
Total
|
|
Investment
Servicing
|
|
Investment
Management
|
|
Total
|
||||||||||||
Beginning balance
|
$
|
5,610
|
|
|
$
|
35
|
|
|
$
|
5,645
|
|
|
$
|
5,591
|
|
|
$
|
6
|
|
|
$
|
5,597
|
|
Acquisitions
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
32
|
|
|
33
|
|
||||||
Foreign currency translation, net
|
5
|
|
|
—
|
|
|
5
|
|
|
11
|
|
|
(2
|
)
|
|
9
|
|
||||||
Ending balance
|
$
|
5,615
|
|
|
$
|
35
|
|
|
$
|
5,650
|
|
|
$
|
5,603
|
|
|
$
|
36
|
|
|
$
|
5,639
|
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||
|
2012
|
|
2011
|
||||||||||||||||||||
(In millions)
|
Investment
Servicing
|
|
Investment
Management
|
|
Total
|
|
Investment
Servicing
|
|
Investment
Management
|
|
Total
|
||||||||||||
Beginning balance
|
$
|
2,408
|
|
|
$
|
51
|
|
|
$
|
2,459
|
|
|
$
|
2,559
|
|
|
$
|
34
|
|
|
$
|
2,593
|
|
Acquisitions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
28
|
|
|
28
|
|
||||||
Amortization
|
(143
|
)
|
|
(2
|
)
|
|
(145
|
)
|
|
(142
|
)
|
|
(7
|
)
|
|
(149
|
)
|
||||||
Foreign currency translation, net
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|
14
|
|
|
(2
|
)
|
|
12
|
|
||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
||||||
Ending balance
|
$
|
2,262
|
|
|
$
|
49
|
|
|
$
|
2,311
|
|
|
$
|
2,431
|
|
|
$
|
55
|
|
|
$
|
2,486
|
|
|
September 30, 2012
|
|
December 31, 2011
|
||||||||||||||||||||
(In millions)
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
Client relationships
|
$
|
2,373
|
|
|
$
|
(710
|
)
|
|
$
|
1,663
|
|
|
$
|
2,369
|
|
|
$
|
(641
|
)
|
|
$
|
1,728
|
|
Core deposits
|
701
|
|
|
(178
|
)
|
|
523
|
|
|
702
|
|
|
(117
|
)
|
|
585
|
|
||||||
Other
|
226
|
|
|
(101
|
)
|
|
125
|
|
|
233
|
|
|
(87
|
)
|
|
146
|
|
||||||
Total
|
$
|
3,300
|
|
|
$
|
(989
|
)
|
|
$
|
2,311
|
|
|
$
|
3,304
|
|
|
$
|
(845
|
)
|
|
$
|
2,459
|
|
(In millions)
|
September 30,
2012 |
|
December 31,
2011 |
||||
Collateral deposits, net
|
$
|
8,020
|
|
|
$
|
6,688
|
|
Unrealized gains on derivative financial instruments, net
|
3,435
|
|
|
6,366
|
|
||
Accounts receivable
|
1,406
|
|
|
431
|
|
||
Investments in joint ventures and other unconsolidated entities
|
1,203
|
|
|
1,060
|
|
||
Receivable for securities settlement
|
525
|
|
|
20
|
|
||
Deferred tax assets, net of valuation allowance
|
379
|
|
|
395
|
|
||
Prepaid expenses
|
374
|
|
|
308
|
|
||
Deposits with clearing organizations
|
196
|
|
|
222
|
|
||
Receivable for securities sold
|
151
|
|
|
11
|
|
||
Non-cash collateral deposits
|
49
|
|
|
110
|
|
||
Income taxes receivable
|
28
|
|
|
989
|
|
||
Other
(1)
|
739
|
|
|
539
|
|
||
Total
|
$
|
16,505
|
|
|
$
|
17,139
|
|
|
|
|
|
(1)
|
Included other real estate owned of approximately
$76 million
and
$75 million
, respectively.
|
(In millions)
|
September 30,
2012 |
|
December 31,
2011 |
||||
Aggregate fair value of indemnified securities financing
|
$
|
305,721
|
|
|
$
|
302,342
|
|
Aggregate fair value of cash and securities held by us, as agent, as collateral for indemnified securities financing
|
317,151
|
|
|
312,598
|
|
||
Aggregate fair value of collateral for indemnified securities financing invested in indemnified repurchase agreements
|
83,973
|
|
|
88,656
|
|
||
Aggregate fair value of cash and securities held by us or our agents as collateral for indemnified repurchase agreements
|
88,897
|
|
|
93,039
|
|
(In millions)
|
September 30,
2012 |
|
December 31,
2011 |
||||
Foreign currency translation
|
$
|
19
|
|
|
|
|
|
Net unrealized losses on hedges of net investments in non-U.S. subsidiaries
|
(14
|
)
|
|
$
|
(14
|
)
|
|
|
|
|
|
||||
Net unrealized gains on available-for-sale securities portfolio
|
823
|
|
|
110
|
|
||
Net unrealized losses related to reclassified available-for-sale securities
|
(120
|
)
|
|
(189
|
)
|
||
Net unrealized gains (losses) on available-for-sale securities
|
703
|
|
|
(79
|
)
|
||
|
|
|
|
||||
Net unrealized losses on available-for-sale securities designated in fair value hedges
|
(196
|
)
|
|
(210
|
)
|
||
Other-than-temporary impairment on available-for-sale securities related to factors other than credit
|
(5
|
)
|
|
(17
|
)
|
||
Other-than-temporary impairment on held-to-maturity securities related to factors other than credit
|
(76
|
)
|
|
(86
|
)
|
||
Net unrealized losses on cash flow hedges
|
(6
|
)
|
|
(5
|
)
|
||
Minimum pension liability
|
(239
|
)
|
|
(248
|
)
|
||
Total
|
$
|
186
|
|
|
$
|
(659
|
)
|
•
|
Quoted prices for similar assets or liabilities in active markets;
|
•
|
Quoted prices for identical or similar assets or liabilities in non-active markets;
|
•
|
Pricing models whose inputs are observable for substantially the full term of the asset or liability; and
|
•
|
Pricing models whose inputs are derived principally from, or corroborated by, observable market information through correlation or other means for substantially the full term of the asset or liability.
|
•
|
Fair value for our investment securities categorized in level 3 is measured using information obtained from third-party sources, typically non-binding broker or dealer quotes, or through the use of internally developed pricing models. Management has evaluated its methodologies used to determine fair value, but has considered the level of observable market information to be insufficient to categorize the securities in level 2.
|
•
|
The fair value of foreign exchange contracts carried in other assets and accrued expenses and other liabilities, primarily composed of options, is measured using an option pricing model. Because of a limited number of observable transactions, certain model inputs are not observable, such as implied volatility surface, but are derived from observable market information.
|
•
|
The fair value of certain interest-rate caps with long-dated maturities, also carried in other assets and accrued expenses and other liabilities, is measured using a matrix pricing approach. Observable market prices are not available for these derivatives, so extrapolation is necessary to value these instruments, since they have a strike and/or maturity outside of the matrix.
|
|
Fair Value Measurements on a Recurring Basis
|
||||||||||||||||||
|
as of September 30, 2012
|
||||||||||||||||||
(In millions)
|
Quoted Market
Prices in Active
Markets
(Level 1)
|
|
Pricing Methods
with Significant
Observable
Market Inputs
(Level 2)
|
|
Pricing Methods
with Significant
Unobservable
Market Inputs
(Level 3)
|
|
Impact of Netting
(1)
|
|
Total Net
Carrying Value
in Consolidated
Statement of
Condition
|
||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Trading account assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. government securities
|
$
|
20
|
|
|
|
|
|
|
|
|
$
|
20
|
|
||||||
Non-U.S. government securities
|
366
|
|
|
|
|
|
|
|
|
366
|
|
||||||||
Other
|
72
|
|
|
$
|
153
|
|
|
|
|
|
|
225
|
|
||||||
Investment securities available for sale:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury and federal agencies:
|
|
|
|
|
|
|
|
|
|
||||||||||
Direct obligations
|
3
|
|
|
867
|
|
|
|
|
|
|
|
870
|
|
||||||
Mortgage-backed securities
|
—
|
|
|
31,097
|
|
|
$
|
906
|
|
|
|
|
32,003
|
|
|||||
Asset-backed securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Student loans
|
—
|
|
|
16,059
|
|
|
478
|
|
|
|
|
16,537
|
|
||||||
Credit cards
|
—
|
|
|
9,728
|
|
|
238
|
|
|
|
|
9,966
|
|
||||||
Sub-prime
|
—
|
|
|
1,379
|
|
|
—
|
|
|
|
|
1,379
|
|
||||||
Other
|
—
|
|
|
666
|
|
|
3,460
|
|
|
|
|
4,126
|
|
||||||
Total asset-backed securities
|
—
|
|
|
27,832
|
|
|
4,176
|
|
|
|
|
32,008
|
|
||||||
Non-U.S. debt securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Mortgage-backed securities
|
—
|
|
|
10,759
|
|
|
285
|
|
|
|
|
11,044
|
|
||||||
Asset-backed securities
|
—
|
|
|
5,243
|
|
|
677
|
|
|
|
|
5,920
|
|
||||||
Government securities
|
—
|
|
|
2,986
|
|
|
—
|
|
|
|
|
2,986
|
|
||||||
Other
|
—
|
|
|
3,840
|
|
|
194
|
|
|
|
|
4,034
|
|
||||||
Total non-U.S. debt securities
|
—
|
|
|
22,828
|
|
|
1,156
|
|
|
|
|
23,984
|
|
||||||
State and political subdivisions
|
—
|
|
|
7,256
|
|
|
48
|
|
|
|
|
7,304
|
|
||||||
Collateralized mortgage obligations
|
—
|
|
|
4,721
|
|
|
124
|
|
|
|
|
4,845
|
|
||||||
Other U.S. debt securities
|
—
|
|
|
5,095
|
|
|
9
|
|
|
|
|
5,104
|
|
||||||
U.S. equity securities
|
—
|
|
|
881
|
|
|
—
|
|
|
|
|
881
|
|
||||||
Non-U.S. equity securities
|
—
|
|
|
130
|
|
|
—
|
|
|
|
|
130
|
|
||||||
Total investment securities available for sale
|
3
|
|
|
100,707
|
|
|
6,419
|
|
|
|
|
107,129
|
|
||||||
Other assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivative instruments:
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign exchange contracts
|
—
|
|
|
6,646
|
|
|
99
|
|
|
|
|
|
|||||||
Interest-rate contracts
|
—
|
|
|
186
|
|
|
—
|
|
|
|
|
|
|||||||
Total derivative instruments
|
—
|
|
|
6,832
|
|
|
99
|
|
|
$
|
(3,496
|
)
|
|
3,435
|
|
||||
Other
|
49
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
51
|
|
|||||
Total assets carried at fair value
|
$
|
510
|
|
|
$
|
107,694
|
|
|
$
|
6,518
|
|
|
$
|
(3,496
|
)
|
|
$
|
111,226
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accrued expenses and other liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivative instruments:
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign exchange contracts
|
|
|
|
$
|
6,351
|
|
|
$
|
100
|
|
|
|
|
|
|||||
Interest-rate contracts
|
|
|
|
301
|
|
|
—
|
|
|
|
|
|
|||||||
Other
|
|
|
|
—
|
|
|
9
|
|
|
|
|
|
|||||||
Total derivative instruments
|
|
|
|
6,652
|
|
|
109
|
|
|
$
|
(2,947
|
)
|
|
$
|
3,814
|
|
|||
Other
|
$
|
49
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
49
|
|
||||
Total liabilities carried at fair value
|
$
|
49
|
|
|
$
|
6,652
|
|
|
$
|
109
|
|
|
$
|
(2,947
|
)
|
|
$
|
3,863
|
|
|
|
|
|
(1)
|
Represents counterparty netting against level 2 financial assets and liabilities, where a legally enforceable master netting agreement exists between State Street and the counterparty. Netting also reflects asset and liability reductions of
$854 million
and
$367 million
, respectively, for cash collateral received from and deposited with derivative counterparties. This netting cannot be disaggregated by type of derivative instrument.
|
|
Fair Value Measurements on a Recurring Basis
|
||||||||||||||||||
|
as of December 31, 2011
|
||||||||||||||||||
(In millions)
|
Quoted Market
Prices in Active
Markets
(Level 1)
|
|
Pricing Methods
with Significant
Observable
Market Inputs
(Level 2)
|
|
Pricing Methods
with Significant
Unobservable
Market Inputs
(Level 3)
|
|
Impact of Netting
(1)
|
|
Total Net
Carrying Value
in Consolidated
Statement of
Condition
|
||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Trading account assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. government securities
|
$
|
20
|
|
|
|
|
|
|
|
|
$
|
20
|
|
||||||
Non-U.S. government securities
|
498
|
|
|
|
|
|
|
|
|
498
|
|
||||||||
Other
|
51
|
|
|
$
|
138
|
|
|
|
|
|
|
189
|
|
||||||
Investment securities available for sale:
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Treasury and federal agencies:
|
|
|
|
|
|
|
|
|
|
||||||||||
Direct obligations
|
1,727
|
|
|
1,109
|
|
|
|
|
|
|
2,836
|
|
|||||||
Mortgage-backed securities
|
—
|
|
|
28,832
|
|
|
$
|
1,189
|
|
|
|
|
30,021
|
|
|||||
Asset-backed securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Student loans
|
—
|
|
|
15,685
|
|
|
860
|
|
|
|
|
16,545
|
|
||||||
Credit cards
|
—
|
|
|
10,396
|
|
|
91
|
|
|
|
|
10,487
|
|
||||||
Sub-prime
|
—
|
|
|
1,404
|
|
|
—
|
|
|
|
|
1,404
|
|
||||||
Other
|
—
|
|
|
667
|
|
|
2,798
|
|
|
|
|
3,465
|
|
||||||
Total asset-backed securities
|
—
|
|
|
28,152
|
|
|
3,749
|
|
|
|
|
31,901
|
|
||||||
Non-U.S. debt securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Mortgage-backed securities
|
—
|
|
|
9,418
|
|
|
1,457
|
|
|
|
|
10,875
|
|
||||||
Asset-backed securities
|
—
|
|
|
2,535
|
|
|
1,768
|
|
|
|
|
4,303
|
|
||||||
Government securities
|
—
|
|
|
1,671
|
|
|
—
|
|
|
|
|
1,671
|
|
||||||
Other
|
—
|
|
|
2,754
|
|
|
71
|
|
|
|
|
2,825
|
|
||||||
Total non-U.S. debt securities
|
—
|
|
|
16,378
|
|
|
3,296
|
|
|
|
|
19,674
|
|
||||||
State and political subdivisions
|
—
|
|
|
6,997
|
|
|
50
|
|
|
|
|
7,047
|
|
||||||
Collateralized mortgage obligations
|
—
|
|
|
3,753
|
|
|
227
|
|
|
|
|
3,980
|
|
||||||
Other U.S. debt securities
|
—
|
|
|
3,613
|
|
|
2
|
|
|
|
|
3,615
|
|
||||||
U.S. equity securities
|
—
|
|
|
640
|
|
|
—
|
|
|
|
|
640
|
|
||||||
Non-U.S. equity securities
|
1
|
|
|
117
|
|
|
—
|
|
|
|
|
118
|
|
||||||
Total investment securities available for sale
|
1,728
|
|
|
89,591
|
|
|
8,513
|
|
|
|
|
99,832
|
|
||||||
Other assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives instruments:
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign exchange contracts
|
—
|
|
|
12,045
|
|
|
168
|
|
|
|
|
|
|||||||
Interest-rate contracts
|
—
|
|
|
1,795
|
|
|
10
|
|
|
|
|
|
|||||||
Other
|
—
|
|
|
1
|
|
|
—
|
|
|
|
|
|
|||||||
Total derivative instruments
|
—
|
|
|
13,841
|
|
|
178
|
|
|
$
|
(7,653
|
)
|
|
6,366
|
|
||||
Other
|
110
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
110
|
|
|||||
Total assets carried at fair value
|
$
|
2,407
|
|
|
$
|
103,570
|
|
|
$
|
8,691
|
|
|
$
|
(7,653
|
)
|
|
$
|
107,015
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accrued expenses and other liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivative instruments:
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign exchange contracts
|
|
|
$
|
12,191
|
|
|
$
|
161
|
|
|
|
|
|
||||||
Interest-rate contracts
|
|
|
1,970
|
|
|
11
|
|
|
|
|
|
||||||||
Other
|
|
|
1
|
|
|
9
|
|
|
|
|
|
||||||||
Total derivative instruments
|
|
|
|
14,162
|
|
|
181
|
|
|
$
|
(7,653
|
)
|
|
$
|
6,690
|
|
|||
Other
|
$
|
110
|
|
|
—
|
|
|
20
|
|
|
—
|
|
|
130
|
|
||||
Total liabilities carried at fair value
|
$
|
110
|
|
|
$
|
14,162
|
|
|
$
|
201
|
|
|
$
|
(7,653
|
)
|
|
$
|
6,820
|
|
|
|
|
|
(1)
|
Represents counterparty netting against level 2 financial assets and liabilities, where a legally enforceable master netting agreement exists between State Street and the counterparty. This netting cannot be disaggregated by type of derivative instrument.
|
|
Fair Value Measurements Using Significant Unobservable Inputs
|
|||||||||||||||||||||||||||||||||||||||||
|
Three Months Ended September 30, 2012
|
|||||||||||||||||||||||||||||||||||||||||
|
Fair
Value at June 30, 2012 |
|
Transfers
into
Level 3
|
|
Transfers
out of
Level 3
|
|
Total Realized and
Unrealized Gains (Losses)
|
|
Purchases
|
|
Issuances
|
|
Sales
|
|
Settlements
|
|
Fair Value at September 30, 2012
|
|
Change in
Unrealized Gains (Losses) Related to Financial Instruments Held at September 30, 2012 |
|||||||||||||||||||||||
(In millions)
|
Recorded
in
Revenue
|
|
Recorded
in Other
Comprehensive
Income
|
|
||||||||||||||||||||||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Investment securities available for sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
U.S. Treasury and federal agencies, mortgage-backed securities
|
$
|
933
|
|
|
|
|
|
|
|
|
|
$
|
3
|
|
|
|
|
|
|
|
|
|
$
|
(30
|
)
|
|
$
|
906
|
|
|
|
|||||||||||
Asset-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Student loans
|
484
|
|
|
|
|
|
|
|
$
|
1
|
|
|
5
|
|
|
|
|
|
|
|
|
|
(12
|
)
|
|
478
|
|
|
|
|||||||||||||
Credit cards
|
274
|
|
|
|
|
$
|
(36
|
)
|
|
1
|
|
|
(1
|
)
|
|
|
|
|
|
|
|
|
—
|
|
|
238
|
|
|
|
|||||||||||||
Other
|
3,094
|
|
|
$
|
12
|
|
|
(11
|
)
|
|
10
|
|
|
14
|
|
|
$
|
608
|
|
|
|
|
|
|
|
(267
|
)
|
|
3,460
|
|
|
|
||||||||||
Total asset-backed securities
|
3,852
|
|
|
12
|
|
|
(47
|
)
|
|
12
|
|
|
18
|
|
|
608
|
|
|
|
|
|
|
|
(279
|
)
|
|
4,176
|
|
|
|
||||||||||||
Non-U.S. debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Mortgage-backed securities
|
273
|
|
|
—
|
|
|
(147
|
)
|
|
—
|
|
|
—
|
|
|
156
|
|
|
|
|
|
|
|
3
|
|
|
285
|
|
|
|
||||||||||||
Asset-backed securities
|
1,362
|
|
|
—
|
|
|
(676
|
)
|
|
1
|
|
|
4
|
|
|
—
|
|
|
|
|
|
|
|
(14
|
)
|
|
677
|
|
|
|
||||||||||||
Other
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
193
|
|
|
|
|
|
|
|
—
|
|
|
194
|
|
|
|
||||||||||||
Total non-U.S. debt securities
|
1,636
|
|
|
—
|
|
|
(823
|
)
|
|
1
|
|
|
4
|
|
|
349
|
|
|
|
|
|
|
|
(11
|
)
|
|
1,156
|
|
|
|
||||||||||||
State and political subdivisions
|
49
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
|
|
|
|
|
—
|
|
|
48
|
|
|
|
||||||||||||
Collateralized mortgage obligations
|
301
|
|
|
—
|
|
|
(123
|
)
|
|
168
|
|
|
1
|
|
|
—
|
|
|
|
|
$
|
(45
|
)
|
|
(178
|
)
|
|
124
|
|
|
|
|||||||||||
Other U.S. debt securities
|
—
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
|
||||||||||||
Total investment securities available for sale
|
6,771
|
|
|
21
|
|
|
(993
|
)
|
|
181
|
|
|
25
|
|
|
957
|
|
|
|
|
(45
|
)
|
|
(498
|
)
|
|
6,419
|
|
|
|
||||||||||||
Other assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Derivative instruments, foreign exchange contracts
|
160
|
|
|
—
|
|
|
—
|
|
|
(69
|
)
|
|
—
|
|
|
75
|
|
|
|
|
—
|
|
|
(67
|
)
|
|
99
|
|
|
$
|
(47
|
)
|
||||||||||
Total assets carried at fair value
|
$
|
6,931
|
|
|
$
|
21
|
|
|
$
|
(993
|
)
|
|
$
|
112
|
|
|
$
|
25
|
|
|
$
|
1,032
|
|
|
—
|
|
|
$
|
(45
|
)
|
|
$
|
(565
|
)
|
|
$
|
6,518
|
|
|
$
|
(47
|
)
|
|
Fair Value Measurements Using Significant Unobservable Inputs
|
|||||||||||||||||||||||||||||||||||||
|
Three Months Ended September 30, 2012
|
|||||||||||||||||||||||||||||||||||||
|
Fair
Value at June 30, 2012 |
|
Transfers
into
Level 3
|
|
Transfers
out of
Level 3
|
|
Total Realized and
Unrealized (Gains) Losses
|
|
Purchases
|
|
Issuances
|
|
Sales
|
|
Settlements
|
|
Fair Value at September 30, 2012
|
|
Change in
Unrealized (Gains) Losses Related to Financial Instruments Held at September 30, 2012 |
|||||||||||||||||||
(In millions)
|
Recorded
in
Revenue
|
|
Recorded
in Other
Comprehensive
Income
|
|
||||||||||||||||||||||||||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Accrued expenses and other liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Derivative instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Foreign exchange contracts
|
$
|
157
|
|
|
|
|
|
|
$
|
(58
|
)
|
|
|
|
|
|
$
|
76
|
|
|
|
|
$
|
(75
|
)
|
|
$
|
100
|
|
|
$
|
(43
|
)
|
|||||
Other
|
9
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|||||||||
Total derivative instruments
|
166
|
|
|
|
|
|
|
(58
|
)
|
|
|
|
|
|
|
76
|
|
|
|
|
|
(75
|
)
|
|
109
|
|
|
(43
|
)
|
|||||||||
Total liabilities carried at fair value
|
$
|
166
|
|
|
—
|
|
|
—
|
|
|
$
|
(58
|
)
|
|
—
|
|
|
—
|
|
|
$
|
76
|
|
|
—
|
|
|
$
|
(75
|
)
|
|
$
|
109
|
|
|
$
|
(43
|
)
|
|
Fair Value Measurements Using Significant Unobservable Inputs
|
|||||||||||||||||||||||||||||||||||||||||
|
Nine Months Ended September 30, 2012
|
|||||||||||||||||||||||||||||||||||||||||
|
Fair
Value at December 31, 2011 |
|
Transfers
into
Level 3
|
|
Transfers
out of
Level 3
|
|
Total Realized and
Unrealized Gains (Losses)
|
|
Purchases
|
|
Issuances
|
|
Sales
|
|
Settlements
|
|
Fair Value at September 30, 2012
|
|
Change in
Unrealized Gains (Losses) Related to Financial Instruments Held at September 30, 2012 |
|||||||||||||||||||||||
(in millions)
|
Recorded
in
Revenue
|
|
Recorded
in Other
Comprehensive
Income
|
|
||||||||||||||||||||||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Investment securities available for sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
U.S. Treasury and federal agencies, mortgage-backed securities
|
$
|
1,189
|
|
|
$
|
50
|
|
|
$
|
(251
|
)
|
|
|
|
$
|
3
|
|
|
|
|
|
|
|
|
|
$
|
(85
|
)
|
|
$
|
906
|
|
|
|
||||||||
Asset-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Student loans
|
860
|
|
|
—
|
|
|
(341
|
)
|
|
$
|
2
|
|
|
(5
|
)
|
|
|
|
|
|
|
|
|
(38
|
)
|
|
478
|
|
|
|
||||||||||||
Credit cards
|
91
|
|
|
21
|
|
|
(36
|
)
|
|
4
|
|
|
(5
|
)
|
|
$
|
224
|
|
|
|
|
$
|
(61
|
)
|
|
—
|
|
|
238
|
|
|
|
||||||||||
Other
|
2,798
|
|
|
12
|
|
|
(11
|
)
|
|
31
|
|
|
39
|
|
|
1,177
|
|
|
|
|
(12
|
)
|
|
(574
|
)
|
|
3,460
|
|
|
|
||||||||||||
Total asset-backed securities
|
3,749
|
|
|
33
|
|
|
(388
|
)
|
|
37
|
|
|
29
|
|
|
1,401
|
|
|
|
|
(73
|
)
|
|
(612
|
)
|
|
4,176
|
|
|
|
||||||||||||
Non-U.S. debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Mortgage-backed securities
|
1,457
|
|
|
—
|
|
|
(1,642
|
)
|
|
—
|
|
|
3
|
|
|
463
|
|
|
|
|
—
|
|
|
4
|
|
|
285
|
|
|
|
||||||||||||
Asset-backed securities
|
1,768
|
|
|
—
|
|
|
(2,243
|
)
|
|
1
|
|
|
4
|
|
|
1,206
|
|
|
|
|
—
|
|
|
(59
|
)
|
|
677
|
|
|
|
||||||||||||
Other
|
71
|
|
|
—
|
|
|
(372
|
)
|
|
—
|
|
|
(3
|
)
|
|
500
|
|
|
|
|
—
|
|
|
(2
|
)
|
|
194
|
|
|
|
||||||||||||
Total Non-U.S. debt securities
|
3,296
|
|
|
—
|
|
|
(4,257
|
)
|
|
1
|
|
|
4
|
|
|
2,169
|
|
|
|
|
—
|
|
|
(57
|
)
|
|
1,156
|
|
|
|
||||||||||||
State and political subdivisions
|
50
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
(2
|
)
|
|
48
|
|
|
|
||||||||||||
Collateralized mortgage obligations
|
227
|
|
|
44
|
|
|
(314
|
)
|
|
369
|
|
|
1
|
|
|
283
|
|
|
|
|
(45
|
)
|
|
(441
|
)
|
|
124
|
|
|
|
||||||||||||
Other U.S. debt securities
|
2
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
(2
|
)
|
|
9
|
|
|
|
||||||||||||
Total investment securities available for sale
|
8,513
|
|
|
136
|
|
|
(5,210
|
)
|
|
407
|
|
|
37
|
|
|
3,853
|
|
|
|
|
(118
|
)
|
|
(1,199
|
)
|
|
6,419
|
|
|
|
||||||||||||
Other assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Derivative instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Foreign exchange contracts
|
168
|
|
|
—
|
|
|
—
|
|
|
(127
|
)
|
|
—
|
|
|
162
|
|
|
|
|
—
|
|
|
(104
|
)
|
|
99
|
|
|
$
|
(71
|
)
|
||||||||||
Interest-rate contracts
|
10
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
Total derivative instruments
|
178
|
|
|
—
|
|
|
—
|
|
|
(137
|
)
|
|
—
|
|
|
162
|
|
|
|
|
|
—
|
|
|
(104
|
)
|
|
99
|
|
|
(71
|
)
|
||||||||||
Total assets carried at fair value
|
$
|
8,691
|
|
|
$
|
136
|
|
|
$
|
(5,210
|
)
|
|
$
|
270
|
|
|
$
|
37
|
|
|
$
|
4,015
|
|
|
—
|
|
|
$
|
(118
|
)
|
|
$
|
(1,303
|
)
|
|
$
|
6,518
|
|
|
$
|
(71
|
)
|
|
Fair Value Measurements Using Significant Unobservable Inputs
|
|||||||||||||||||||||||||||||||||||||
|
Nine Months Ended September 30, 2012
|
|||||||||||||||||||||||||||||||||||||
|
Fair Value at December 31, 2011
|
|
Transfers
into
Level 3
|
|
Transfers
out of
Level 3
|
|
Total Realized and
Unrealized (Gains) Losses
|
|
Purchases
|
|
Issuances
|
|
Sales
|
|
Settlements
|
|
Fair Value at September 30, 2012
|
|
Change in
Unrealized (Gains) Losses Related to Financial Instruments Held at September 30, 2012 |
|||||||||||||||||||
(In millions)
|
Recorded
in
Revenue
|
|
Recorded
in Other
Comprehensive
Income
|
|
||||||||||||||||||||||||||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Accrued expenses and other liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Derivative instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Foreign exchange contracts
|
$
|
161
|
|
|
|
|
|
|
$
|
(131
|
)
|
|
|
|
|
|
$
|
162
|
|
|
|
|
$
|
(92
|
)
|
|
$
|
100
|
|
|
$
|
(70
|
)
|
|||||
Interest-rate contracts
|
11
|
|
|
|
|
|
|
(11
|
)
|
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Other
|
9
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|||||||||||
Total derivative instruments
|
181
|
|
|
|
|
|
|
(142
|
)
|
|
|
|
|
|
|
162
|
|
|
|
|
|
(92
|
)
|
|
109
|
|
|
(70
|
)
|
|||||||||
Other
|
20
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
(20
|
)
|
|
—
|
|
|
—
|
|
|||||||||
Total liabilities carried at fair value
|
$
|
201
|
|
|
—
|
|
|
—
|
|
|
$
|
(142
|
)
|
|
—
|
|
|
—
|
|
|
$
|
162
|
|
|
—
|
|
|
$
|
(112
|
)
|
|
$
|
109
|
|
|
$
|
(70
|
)
|
|
Fair Value Measurements Using Significant Unobservable Inputs
|
||||||||||||||||||||||||||||||||||||||||
|
Three Months Ended September 30, 2011
|
||||||||||||||||||||||||||||||||||||||||
|
Fair
Value at June 30, 2011 |
|
Transfers
into
Level 3
|
|
Transfers
out of
Level 3
|
|
Total Realized and
Unrealized Gains (Losses)
|
|
Purchases
|
|
Issuances
|
|
Sales
|
|
Settlements
|
|
Fair
Value at September 30, 2011 |
|
Change in
Unrealized Gains (Losses) Related to Financial Instruments Held at September 30, 2011 |
||||||||||||||||||||||
(In millions)
|
Recorded
in
Revenue
|
|
Recorded
in Other
Comprehensive
Income
|
|
|||||||||||||||||||||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Investment securities available for sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
U.S. Treasury and federal agencies:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Direct obligations
|
$
|
17
|
|
|
|
|
$
|
(17
|
)
|
|
|
|
|
|
$
|
22
|
|
|
|
|
|
|
|
|
$
|
22
|
|
|
|
||||||||||||
Mortgage-backed securities
|
932
|
|
|
|
|
|
|
|
|
$
|
2
|
|
|
590
|
|
|
|
|
|
|
$
|
(25
|
)
|
|
1,499
|
|
|
|
|||||||||||||
Asset-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Student loans
|
1,289
|
|
|
|
|
$
|
(379
|
)
|
|
$
|
(1
|
)
|
|
(6
|
)
|
|
—
|
|
|
|
|
|
|
46
|
|
|
949
|
|
|
|
|||||||||||
Credit cards
|
79
|
|
|
|
|
(20
|
)
|
|
2
|
|
|
—
|
|
|
250
|
|
|
|
|
|
|
—
|
|
|
311
|
|
|
|
|||||||||||||
Other
|
2,530
|
|
|
|
|
|
—
|
|
|
5
|
|
|
(34
|
)
|
|
267
|
|
|
|
|
$
|
(37
|
)
|
|
2
|
|
|
2,733
|
|
|
|
||||||||||
Total asset-backed securities
|
3,898
|
|
|
|
|
|
(399
|
)
|
|
6
|
|
|
(40
|
)
|
|
517
|
|
|
|
|
|
(37
|
)
|
|
48
|
|
|
3,993
|
|
|
|
||||||||||
Non-U.S. debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Mortgage-backed securities
|
361
|
|
|
|
|
|
(36
|
)
|
|
—
|
|
|
(1
|
)
|
|
608
|
|
|
|
|
—
|
|
|
(2
|
)
|
|
930
|
|
|
|
|||||||||||
Asset-backed securities
|
1,749
|
|
|
|
|
(573
|
)
|
|
—
|
|
|
(3
|
)
|
|
286
|
|
|
|
|
(3
|
)
|
|
(50
|
)
|
|
1,406
|
|
|
|
||||||||||||
Other
|
6
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
|
||||||||||||
Total non-U.S. debt securities
|
2,116
|
|
|
|
|
|
(609
|
)
|
|
—
|
|
|
(4
|
)
|
|
894
|
|
|
|
|
|
(3
|
)
|
|
(52
|
)
|
|
2,342
|
|
|
|
||||||||||
State and political subdivisions
|
54
|
|
|
|
|
(2
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
51
|
|
|
|
||||||||||||
Collateralized mortgage obligations
|
173
|
|
|
|
|
|
(31
|
)
|
|
31
|
|
|
(1
|
)
|
|
216
|
|
|
|
|
—
|
|
|
(38
|
)
|
|
350
|
|
|
|
|||||||||||
Other U.S. debt securities
|
2
|
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
|
|||||||||||
Total investment securities available for sale
|
7,192
|
|
|
|
|
|
(1,058
|
)
|
|
37
|
|
|
(44
|
)
|
|
2,239
|
|
|
|
|
|
(40
|
)
|
|
(67
|
)
|
|
8,259
|
|
|
|
||||||||||
Other assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Derivative instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Foreign exchange contracts
|
201
|
|
|
|
|
—
|
|
|
54
|
|
|
—
|
|
|
173
|
|
|
|
|
|
|
(117
|
)
|
|
311
|
|
|
$
|
59
|
|
|||||||||||
Interest-rate contracts
|
8
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
|
|
(1
|
)
|
|
—
|
|
|
11
|
|
|
2
|
|
|||||||||||
Total derivative instruments
|
209
|
|
|
|
|
|
—
|
|
|
54
|
|
|
—
|
|
|
177
|
|
|
|
|
|
(1
|
)
|
|
(117
|
)
|
|
322
|
|
|
61
|
|
|||||||||
Total assets carried at fair value
|
$
|
7,401
|
|
|
—
|
|
|
$
|
(1,058
|
)
|
|
$
|
91
|
|
|
$
|
(44
|
)
|
|
$
|
2,416
|
|
|
—
|
|
|
$
|
(41
|
)
|
|
$
|
(184
|
)
|
|
$
|
8,581
|
|
|
$
|
61
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs
|
|||||||||||||||||||||||||||||||||||||||
|
Three Months Ended September 30, 2011
|
|||||||||||||||||||||||||||||||||||||||
|
Fair
Value at June 30, 2011 |
|
Transfers
into
Level 3
|
|
Transfers
out of
Level 3
|
|
Total Realized and
Unrealized (Gains) Losses
|
|
Purchases
|
|
Issuances
|
|
Sales
|
|
Settlements
|
|
Fair
Value at September 30, 2011 |
|
Change in
Unrealized (Gains) Losses Related to Financial Instruments Held at September 30, 2011 |
|||||||||||||||||||||
(In millions)
|
Recorded
in
Revenue
|
|
Recorded
in Other
Comprehensive
Income
|
|
||||||||||||||||||||||||||||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Accrued expenses and other liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Derivative instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Foreign exchange contracts
|
$
|
203
|
|
|
|
|
|
|
|
$
|
42
|
|
|
|
|
|
|
|
$
|
170
|
|
|
|
|
|
$
|
(117
|
)
|
|
$
|
298
|
|
|
$
|
51
|
|
||||
Interest-rate contracts
|
16
|
|
|
|
|
|
|
—
|
|
|
|
|
$
|
(1
|
)
|
|
15
|
|
|
$
|
(16
|
)
|
|
—
|
|
|
14
|
|
|
10
|
|
|||||||||
Other
|
9
|
|
|
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
—
|
|
||||||||||
Total derivative instruments
|
228
|
|
|
|
|
|
|
|
|
42
|
|
|
|
|
|
(1
|
)
|
|
185
|
|
|
(16
|
)
|
|
(117
|
)
|
|
321
|
|
|
61
|
|
||||||||
Other
|
11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11
|
|
|
|
|||||||||||||||||
Total liabilities carried at fair value
|
$
|
239
|
|
|
—
|
|
|
—
|
|
|
$
|
42
|
|
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
185
|
|
|
$
|
(16
|
)
|
|
$
|
(117
|
)
|
|
$
|
332
|
|
|
$
|
61
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs
|
|||||||||||||||||||||||||||||||||||||||||
|
Nine Months Ended September 30, 2011
|
|||||||||||||||||||||||||||||||||||||||||
|
Fair
Value at
December 31,
2010
|
|
Transfers
into
Level 3
|
|
Transfers
out of
Level 3
|
|
Total Realized and
Unrealized Gains (Losses)
|
|
Purchases
|
|
Issuances
|
|
Sales
|
|
Settlements
|
|
Fair
Value at September 30, 2011 |
|
Change in
Unrealized Gains (Losses) Related to Financial Instruments Held at September 30, 2011 |
|||||||||||||||||||||||
(In millions)
|
Recorded
in
Revenue
|
|
Recorded
in Other
Comprehensive
Income
|
|||||||||||||||||||||||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Investment securities available for sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
U.S. Treasury and federal agencies:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Direct obligations
|
|
|
|
|
$
|
(17
|
)
|
|
|
|
|
|
$
|
39
|
|
|
|
|
|
|
|
|
$
|
22
|
|
|
|
|||||||||||||||
Mortgage-backed securities
|
$
|
673
|
|
|
|
|
|
(404
|
)
|
|
|
|
|
$
|
3
|
|
|
1,289
|
|
|
|
|
|
|
$
|
(62
|
)
|
|
1,499
|
|
|
|
||||||||||
Asset-backed securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Student loans
|
1,234
|
|
|
|
|
|
(720
|
)
|
|
$
|
2
|
|
|
(6
|
)
|
|
421
|
|
|
|
|
|
|
18
|
|
|
949
|
|
|
|
||||||||||||
Credit cards
|
43
|
|
|
|
|
|
(35
|
)
|
|
3
|
|
|
(2
|
)
|
|
301
|
|
|
|
|
|
|
1
|
|
|
311
|
|
|
|
|||||||||||||
Other
|
2,000
|
|
|
$
|
114
|
|
|
(135
|
)
|
|
22
|
|
|
14
|
|
|
837
|
|
|
|
|
$
|
(37
|
)
|
|
(82
|
)
|
|
2,733
|
|
|
|
||||||||||
Total asset-backed securities
|
3,277
|
|
|
114
|
|
|
(890
|
)
|
|
27
|
|
|
6
|
|
|
1,559
|
|
|
|
|
(37
|
)
|
|
(63
|
)
|
|
3,993
|
|
|
|
||||||||||||
Non-U.S. debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Mortgage-backed securities
|
396
|
|
|
—
|
|
|
(739
|
)
|
|
—
|
|
|
—
|
|
|
1,261
|
|
|
|
|
—
|
|
|
12
|
|
|
930
|
|
|
|
||||||||||||
Asset-backed securities
|
740
|
|
|
—
|
|
|
(693
|
)
|
|
1
|
|
|
8
|
|
|
1,538
|
|
|
|
|
(3
|
)
|
|
(185
|
)
|
|
1,406
|
|
|
|
||||||||||||
Government securities
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
|
||||||||||||
Other
|
8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
(2
|
)
|
|
6
|
|
|
|
||||||||||||
Total non-U.S. debt securities
|
1,145
|
|
|
—
|
|
|
(1,432
|
)
|
|
1
|
|
|
8
|
|
|
2,799
|
|
|
|
|
(3
|
)
|
|
(176
|
)
|
|
2,342
|
|
|
|
||||||||||||
State and political subdivisions
|
50
|
|
|
1
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
3
|
|
|
|
|
|
|
—
|
|
|
51
|
|
|
|
|||||||||||||
Collateralized mortgage obligations
|
359
|
|
|
—
|
|
|
(359
|
)
|
|
363
|
|
|
(2
|
)
|
|
381
|
|
|
|
|
|
|
(392
|
)
|
|
350
|
|
|
|
|||||||||||||
Other U.S. debt securities
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
(1
|
)
|
|
2
|
|
|
|
|||||||||||||
Total investment securities available for sale
|
5,507
|
|
|
115
|
|
|
(3,105
|
)
|
|
391
|
|
|
15
|
|
|
6,070
|
|
|
|
|
(40
|
)
|
|
(694
|
)
|
|
8,259
|
|
|
|
||||||||||||
Other assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Derivative instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Foreign exchange contracts
|
254
|
|
|
—
|
|
|
—
|
|
|
(15
|
)
|
|
—
|
|
|
256
|
|
|
|
|
|
—
|
|
|
(184
|
)
|
|
311
|
|
|
$
|
40
|
|
|||||||||
Interest-rate contracts
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
10
|
|
|
|
|
(4
|
)
|
|
—
|
|
|
11
|
|
|
9
|
|
|||||||||||
Total derivative instruments
|
254
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
—
|
|
|
266
|
|
|
|
|
(4
|
)
|
|
(184
|
)
|
|
322
|
|
|
49
|
|
|||||||||||
Total assets carried at fair value
|
$
|
5,761
|
|
|
$
|
115
|
|
|
$
|
(3,105
|
)
|
|
$
|
381
|
|
|
$
|
15
|
|
|
$
|
6,336
|
|
|
—
|
|
|
$
|
(44
|
)
|
|
$
|
(878
|
)
|
|
$
|
8,581
|
|
|
$
|
49
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs
|
|||||||||||||||||||||||||||||||||||||||
|
Nine Months Ended September 30, 2011
|
|||||||||||||||||||||||||||||||||||||||
|
Fair
Value at
December 31,
2010
|
|
Transfers
into
Level 3
|
|
Transfers
out of
Level 3
|
|
Total Realized and
Unrealized (Gains) Losses
|
|
Purchases
|
|
Issuances
|
|
Sales
|
|
Settlements
|
|
Fair
Value at September 30, 2011 |
|
Change in
Unrealized (Gains) Losses Related to Financial Instruments Held at September 30, 2011 |
|||||||||||||||||||||
(In millions)
|
Recorded
in
Revenue
|
|
Recorded
in Other
Comprehensive
Income
|
|||||||||||||||||||||||||||||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Accrued expenses and other liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Derivative instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Foreign exchange contracts
|
$
|
260
|
|
|
|
|
|
|
|
$
|
(21
|
)
|
|
|
|
|
|
|
$
|
247
|
|
|
|
|
|
$
|
(188
|
)
|
|
$
|
298
|
|
|
$
|
32
|
|
||||
Interest-rate contracts
|
—
|
|
|
|
|
|
|
|
10
|
|
|
|
|
$
|
(5
|
)
|
|
29
|
|
|
$
|
(20
|
)
|
|
—
|
|
|
14
|
|
|
10
|
|
||||||||
Other
|
9
|
|
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|||||||||||
Total derivative instruments
|
269
|
|
|
|
|
|
|
|
(11
|
)
|
|
|
|
(5
|
)
|
|
276
|
|
|
(20
|
)
|
|
(188
|
)
|
|
321
|
|
|
42
|
|
||||||||||
Other
|
—
|
|
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
11
|
|
|
—
|
|
|
—
|
|
|
11
|
|
|
|
||||||||||||
Total liabilities carried at fair value
|
$
|
269
|
|
|
—
|
|
|
—
|
|
|
$
|
(11
|
)
|
|
—
|
|
|
$
|
(5
|
)
|
|
$
|
287
|
|
|
$
|
(20
|
)
|
|
$
|
(188
|
)
|
|
$
|
332
|
|
|
$
|
42
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||||
(In millions)
|
Total Realized and
Unrealized Gains
(Losses) Recorded
in Revenue
|
|
Change in
Unrealized Gains
(Losses) Related to
Financial
Instruments Held at
September 30,
|
|
Total Realized and
Unrealized Gains
(Losses) Recorded
in Revenue
|
|
Change in
Unrealized Gains
(Losses) Related to
Financial
Instruments Held at
September 30,
|
||||||||||||||||||||||
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||||||||
Fee revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Trading services
|
$
|
(11
|
)
|
|
$
|
12
|
|
|
(4
|
)
|
|
|
|
$
|
5
|
|
|
$
|
1
|
|
|
$
|
(1
|
)
|
|
$
|
7
|
|
|
Total fee revenue
|
(11
|
)
|
|
12
|
|
|
(4
|
)
|
|
|
|
5
|
|
|
1
|
|
|
(1
|
)
|
|
7
|
|
|||||||
Net interest revenue
|
181
|
|
|
37
|
|
|
|
|
|
|
407
|
|
|
391
|
|
|
—
|
|
|
—
|
|
||||||||
Total revenue
|
$
|
170
|
|
|
$
|
49
|
|
|
(4
|
)
|
|
—
|
|
|
$
|
412
|
|
|
$
|
392
|
|
|
$
|
(1
|
)
|
|
$
|
7
|
|
|
|
|
Quantitative Information about Level-3 Fair Value Measurements
|
||||||||
(Dollars in millions)
|
|
Fair Value at September 30, 2012
|
|
Valuation Technique
|
|
Significant
Unobservable Input |
|
Weighted-Average
|
||
Significant unobservable inputs readily available to State Street:
|
|
|
|
|
|
|
|
|
||
Assets:
|
|
|
|
|
|
|
|
|
||
Asset-backed securities, student loans
|
|
$
|
12
|
|
|
Discounted cash flows
|
|
Credit spread
|
|
6.7%
|
Asset-backed securities, credit cards
|
|
138
|
|
|
Discounted cash flows
|
|
Credit spread
|
|
3.0%
|
|
Asset-backed securities, other
|
|
101
|
|
|
Discounted cash flows
|
|
Credit spread
|
|
2.0%
|
|
State and political subdivisions
|
|
48
|
|
|
Discounted cash flows
|
|
Credit spread
|
|
1.9%
|
|
Derivative instruments, foreign exchange contracts
|
|
99
|
|
|
Option model
|
|
Volatility
|
|
9.3%
|
|
Total
|
|
$
|
398
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Liabilities:
|
|
|
|
|
|
|
|
|
||
Derivative instruments, foreign exchange contracts
|
|
$
|
100
|
|
|
Option model
|
|
Volatility
|
|
9.3%
|
Derivative instruments, other
|
|
9
|
|
|
Discounted cash flows
|
|
Participant redemptions
|
|
5.9%
|
|
Total
|
|
$
|
109
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value at September 30, 2012
|
||||||||||
(In millions)
|
|
Significant Unobservable Inputs Readily Available to State Street
(1)
|
|
Significant Unobservable Inputs Not Developed by State Street and Not Readily Available
(2)
|
|
Total Assets and Liabilities with Significant Unobservable Inputs
|
||||||
Assets:
|
|
|
|
|
|
|
||||||
Mortgage-backed securities
|
|
|
|
$
|
906
|
|
|
$
|
906
|
|
||
Asset-backed securities, student loans
|
|
$
|
12
|
|
|
466
|
|
|
478
|
|
||
Asset-backed securities, credit cards
|
|
138
|
|
|
100
|
|
|
238
|
|
|||
Asset-backed securities, other
|
|
101
|
|
|
3,359
|
|
|
3,460
|
|
|||
Non-U.S. debt securities, mortgage-backed securities
|
|
—
|
|
|
285
|
|
|
285
|
|
|||
Non-U.S. debt securities, asset-backed securities
|
|
—
|
|
|
677
|
|
|
677
|
|
|||
Non-U.S. debt securities, other
|
|
—
|
|
|
194
|
|
|
194
|
|
|||
State and political subdivisions
|
|
48
|
|
|
—
|
|
|
48
|
|
|||
Collateralized mortgage obligations
|
|
—
|
|
|
124
|
|
|
124
|
|
|||
Other U.S.debt securities
|
|
—
|
|
|
9
|
|
|
9
|
|
|||
Derivative instruments, foreign exchange contracts
|
|
99
|
|
|
—
|
|
|
99
|
|
|||
Total
|
|
$
|
398
|
|
|
$
|
6,120
|
|
|
$
|
6,518
|
|
|
|
|
|
|
|
|
||||||
Liabilities:
|
|
|
|
|
|
|
||||||
Derivative instruments, foreign exchange contracts
|
|
$
|
100
|
|
|
|
|
$
|
100
|
|
||
Derivative instruments, other
|
|
9
|
|
|
|
|
9
|
|
||||
Total
|
|
$
|
109
|
|
|
—
|
|
|
$
|
109
|
|
|
|
|
|
|
•
|
The significant unobservable input used in the measurement of the fair value of our asset-backed securities and investment securities issued by state and political subdivisions is the credit spread. Significant increases (decreases) in the credit spread would result in measurements of significantly lower (higher) fair value.
|
•
|
The significant unobservable inputs used in the measurement of the fair value of our other non-U.S. debt securities, specifically securities collateralized by sovereign trade credit obligations, are discount rates, expected recovery and expected maturity. Significant increases (decreases) in the discount rate and the expected maturity in isolation would result in measurements of significantly lower (higher) fair value. A significant increase (decrease) in the expected recovery would result in measurements of significantly higher (lower) fair value. However, a change in the discount rate plays a much more significant role in the measurement of fair value.
|
•
|
The significant unobservable input used in the measurement of the fair value of our foreign exchange option contracts is the implied volatility surface. A significant increase (decrease) in the implied volatility surface would result in measurements of significantly higher (lower) fair value.
|
•
|
The significant unobservable input used in the measurement of the fair value of our other derivative instruments, specifically stable value wrap contracts, is participant redemptions. Increased volatility of redemptions may result in changes to the measurement of fair value. Generally, significant increases (decreases) in participant redemptions may result in measurements of significantly higher (lower) fair value of this liability.
|
•
|
For financial instruments that have quoted market prices, those quoted prices are used to estimate fair value.
|
•
|
For financial instruments that have no defined maturity, have a remaining maturity of 180 days or less, or reprice frequently to a market rate, we assume that the fair value of these instruments approximates their reported value, after taking into consideration any applicable credit risk.
|
•
|
For financial instruments for which no quoted market prices are available, fair value is estimated using information obtained from independent third parties, or by discounting the expected cash flows using an estimated current market interest rate for the financial instrument.
|
|
|
|
|
|
|
Fair Value Hierarchy
|
||||||||||||||
(In millions)
|
|
Reported Amount
|
|
Fair Value
|
|
Quoted Market Prices in Active Markets (Level 1)
|
|
Pricing Methods with Significant Observable Market Inputs (Level 2)
|
|
Pricing Methods with Significant Unobservable Market Inputs (Level 3)
|
||||||||||
Financial Assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and due from banks
|
|
$
|
6,432
|
|
|
$
|
6,432
|
|
|
$
|
6,432
|
|
|
|
|
|
||||
Interest-bearing deposits with banks
|
|
31,583
|
|
|
31,583
|
|
|
|
|
$
|
31,583
|
|
|
|
||||||
Securities purchased under resale agreements
|
|
8,264
|
|
|
8,264
|
|
|
—
|
|
|
8,264
|
|
|
|
||||||
Investment securities held to maturity
|
|
8,360
|
|
|
8,622
|
|
|
—
|
|
|
8,622
|
|
|
|
||||||
Loans (excluding leases)
|
|
12,845
|
|
|
12,858
|
|
|
—
|
|
|
11,878
|
|
|
$
|
980
|
|
||||
Financial Liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deposits:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Noninterest-bearing
|
|
40,963
|
|
|
40,963
|
|
|
—
|
|
|
40,963
|
|
|
—
|
|
|||||
Interest-bearing-U.S.
|
|
11,107
|
|
|
11,107
|
|
|
—
|
|
|
11,107
|
|
|
—
|
|
|||||
Interest-bearing-non-U.S.
|
|
94,219
|
|
|
94,219
|
|
|
—
|
|
|
94,219
|
|
|
—
|
|
|||||
Securities sold under repurchase agreements
|
|
7,933
|
|
|
7,933
|
|
|
—
|
|
|
7,933
|
|
|
—
|
|
|||||
Federal funds purchased
|
|
169
|
|
|
169
|
|
|
—
|
|
|
169
|
|
|
—
|
|
|||||
Other short-term borrowings
|
|
5,181
|
|
|
5,181
|
|
|
—
|
|
|
5,181
|
|
|
—
|
|
|||||
Long-term debt
|
|
6,418
|
|
|
6,700
|
|
|
—
|
|
|
5,808
|
|
|
892
|
|
(In millions)
|
Reported
Amount
|
|
Fair
Value
|
||||
Financial Assets:
|
|
|
|
||||
Investment securities held to maturity
|
$
|
9,321
|
|
|
$
|
9,362
|
|
Net loans (excluding leases)
|
8,777
|
|
|
8,752
|
|
||
|
|
|
|
||||
Financial Liabilities:
|
|
|
|
||||
Long-term debt
|
8,131
|
|
|
8,206
|
|
(In millions)
|
September 30,
2012 |
|
December 31,
2011 |
||||
Derivatives not designated as hedging instruments:
|
|
|
|
||||
Interest-rate contracts:
|
|
|
|
||||
Swap agreements and forwards
|
$
|
1,668
|
|
|
$
|
238,008
|
|
Options and caps purchased
|
80
|
|
|
1,431
|
|
||
Options and caps written
|
80
|
|
|
1,324
|
|
||
Futures
|
5,890
|
|
|
66,620
|
|
||
Foreign exchange contracts:
|
|
|
|
||||
Forward, swap and spot
|
949,752
|
|
|
1,033,045
|
|
||
Options purchased
|
11,827
|
|
|
11,215
|
|
||
Options written
|
11,235
|
|
|
12,342
|
|
||
Credit derivative contracts:
|
|
|
|
||||
Credit default swap agreements
|
28
|
|
|
105
|
|
||
Other:
|
|
|
|
||||
Stable value contracts
|
35,825
|
|
|
40,963
|
|
||
Derivatives designated as hedging instruments:
|
|
|
|
||||
Interest-rate contracts:
|
|
|
|
||||
Swap agreements
|
3,784
|
|
|
3,872
|
|
||
Foreign exchange contracts:
|
|
|
|
||||
Forward and swap
|
3,463
|
|
|
2,613
|
|
|
September 30, 2012
|
|
December 31, 2011
|
||||||||||||||||||||
(In millions)
|
Fair
Value
Hedges
|
|
Cash
Flow
Hedges
|
|
Total
|
|
Fair
Value
Hedges
|
|
Cash
Flow
Hedges
|
|
Total
|
||||||||||||
Investment securities available for sale
|
$
|
1,205
|
|
|
$
|
129
|
|
|
$
|
1,334
|
|
|
$
|
1,298
|
|
|
$
|
124
|
|
|
$
|
1,422
|
|
Long-term debt
(1)
|
2,450
|
|
|
—
|
|
|
2,450
|
|
|
2,450
|
|
|
—
|
|
|
2,450
|
|
||||||
Total
|
$
|
3,655
|
|
|
$
|
129
|
|
|
$
|
3,784
|
|
|
$
|
3,748
|
|
|
$
|
124
|
|
|
$
|
3,872
|
|
|
|
|
|
(1)
|
As of
September 30, 2012
and
December 31, 2011
, fair value hedges of long-term debt increased the carrying value of long-term debt presented in our consolidated statement of condition by
$190 million
and
$140 million
, respectively.
|
|
Three Months Ended September 30,
|
||||||||||
|
2012
|
|
2011
|
||||||||
|
Contractual
Rates
|
|
Rate Including
Impact of Hedges
|
|
Contractual
Rates
|
|
Rate Including
Impact of Hedges
|
||||
Long-term debt
|
4.13
|
%
|
|
3.20
|
%
|
|
3.58
|
%
|
|
3.17
|
%
|
|
Nine Months Ended September 30,
|
||||||||||
|
2012
|
|
2011
|
||||||||
|
Contractual
Rates
|
|
Rate Including
Impact of Hedges
|
|
Contractual
Rates
|
|
Rate Including
Impact of Hedges
|
||||
Long-term debt
|
4.01
|
%
|
|
3.20
|
%
|
|
3.56
|
%
|
|
3.17
|
%
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||
|
September 30, 2012
|
|
September 30, 2012
|
||||||||
(In millions)
|
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Foreign exchange contracts
|
Other assets
|
|
$
|
6,738
|
|
|
Other liabilities
|
|
$
|
6,444
|
|
Interest-rate contracts
|
Other assets
|
|
5
|
|
|
Other liabilities
|
|
1
|
|
||
Other derivative contracts
|
Other assets
|
|
—
|
|
|
Other liabilities
|
|
9
|
|
||
Total
|
|
|
$
|
6,743
|
|
|
|
|
$
|
6,454
|
|
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Interest-rate contracts
|
Other assets
|
|
$
|
181
|
|
|
Other liabilities
|
|
$
|
300
|
|
Foreign exchange contracts
|
Other assets
|
|
7
|
|
|
Other liabilities
|
|
7
|
|
||
Total
|
|
|
$
|
188
|
|
|
|
|
$
|
307
|
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||
|
December 31, 2011
|
|
December 31, 2011
|
||||||||
(In millions)
|
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Foreign exchange contracts
|
Other assets
|
|
$
|
12,210
|
|
|
Other liabilities
|
|
$
|
12,315
|
|
Interest-rate contracts
|
Other assets
|
|
1,682
|
|
|
Other liabilities
|
|
1,688
|
|
||
Other derivative contracts
|
Other assets
|
|
1
|
|
|
Other liabilities
|
|
10
|
|
||
Total
|
|
|
$
|
13,893
|
|
|
|
|
$
|
14,013
|
|
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Interest-rate contracts
|
Other assets
|
|
$
|
123
|
|
|
Other liabilities
|
|
$
|
293
|
|
Foreign exchange contracts
|
Other assets
|
|
3
|
|
|
Other liabilities
|
|
37
|
|
||
Total
|
|
|
$
|
126
|
|
|
|
|
$
|
330
|
|
|
Location of Gain (Loss) on
Derivative in Consolidated
Statement of Income
|
|
Amount of Gain (Loss) on Derivative Recognized in
Consolidated Statement
of Income
|
||||||||||||||
|
|
|
Three Months Ended September 30
|
|
Nine Months Ended September 30,
|
||||||||||||
(In millions)
|
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
Trading services revenue
|
|
$
|
113
|
|
|
$
|
170
|
|
|
$
|
459
|
|
|
$
|
526
|
|
Foreign exchange contracts
|
Processing fees and other revenue
|
|
1
|
|
|
5
|
|
|
(2
|
)
|
|
6
|
|
||||
Interest-rate contracts
|
Trading services revenue
|
|
1
|
|
|
43
|
|
|
(87
|
)
|
|
(4
|
)
|
||||
Interest-rate contracts
|
Processing fees and other revenue
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
||||
Total
|
|
|
$
|
115
|
|
|
$
|
218
|
|
|
$
|
372
|
|
|
$
|
528
|
|
|
Location of Gain (Loss) on Derivative in Consolidated Statement of Income
|
|
Amount of Gain
(Loss) on Derivative
Recognized in
Consolidated
Statement of Income
|
|
Hedged Item in Fair Value Hedging Relationship
|
|
Location of Gain (Loss) on Hedged Item in Consolidated Statement of Income
|
|
Amount of Gain
(Loss) on Hedged
Item Recognized in
Consolidated
Statement of Income
|
||||||||||||
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
(In millions)
|
|
|
September 30,
2012 |
|
September 30,
2012 |
|
|
|
|
|
September 30,
2012 |
|
September 30,
2012 |
||||||||
Derivatives designated as fair value hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
Processing fees and
other revenue
|
|
$
|
26
|
|
|
$
|
30
|
|
|
Investment securities
|
|
Processing fees and
other revenue
|
|
$
|
(26
|
)
|
|
$
|
(30
|
)
|
Interest-rate contracts
|
Processing fees and
other revenue
|
|
22
|
|
|
62
|
|
|
Long-term debt
|
|
Processing fees and
other revenue
|
|
(21
|
)
|
|
(58
|
)
|
||||
Interest-rate contracts
|
Processing fees and
other revenue
|
|
(1
|
)
|
|
(7
|
)
|
|
Available-for-sale securities
|
|
Processing fees and
other revenue
|
|
1
|
|
|
3
|
|
||||
Total
|
|
|
$
|
47
|
|
|
$
|
85
|
|
|
|
|
|
|
$
|
(46
|
)
|
|
$
|
(85
|
)
|
|
Location of Gain (Loss) on Derivative in Consolidated Statement of Income
|
|
Amount of Gain
(Loss) on Derivative
Recognized in
Consolidated
Statement of Income
|
|
Hedged Item in Fair Value Hedging Relationship
|
|
Location of Gain (Loss) on Hedged Item in Consolidated Statement of Income
|
|
Amount of Gain
(Loss) on Hedged
Item Recognized in
Consolidated
Statement of Income
|
||||||||||||
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
(In millions)
|
|
|
September 30,
2011 |
|
September 30,
2011 |
|
|
|
|
|
September 30,
2011 |
|
September 30,
2011 |
||||||||
Derivatives designated as fair value hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
Processing fees and
other revenue
|
|
$
|
(306
|
)
|
|
$
|
(306
|
)
|
|
Investment securities
|
|
Processing fees and
other revenue
|
|
$
|
306
|
|
|
$
|
306
|
|
Interest-rate contracts
|
Processing fees and
other revenue
|
|
(171
|
)
|
|
(161
|
)
|
|
Available-
for-sale securities
|
|
Processing fees and
other revenue
|
|
172
|
|
|
158
|
|
||||
Interest-rate contacts
|
Processing fees and
other revenue
|
|
44
|
|
|
60
|
|
|
Long-term debt
|
|
Processing fees
and other revenue
|
|
(42
|
)
|
|
(56
|
)
|
||||
Total
|
|
|
$
|
(433
|
)
|
|
$
|
(407
|
)
|
|
|
|
|
|
$
|
436
|
|
|
$
|
408
|
|
|
Amount of Gain
(Loss) on Derivative
Recognized in Other
Comprehensive
Income
|
|
Location of Gain (Loss) Reclassified from OCI to Consolidated Statement of Income
|
|
Amount of Gain
(Loss) Reclassified
from OCI to
Consolidated
Statement of Income
|
|
Location of Gain (Loss) on Derivative Recognized in Consolidated Statement of Income
|
|
Amount of Gain
(Loss) on Derivative
Recognized in
Consolidated
Statement of Income
|
||||||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
(In millions)
|
September 30,
2012 |
|
September 30,
2012 |
|
|
|
September 30,
2012 |
|
September 30,
2012 |
|
|
|
September 30,
2012 |
|
September 30,
2012 |
||||||||||||
Derivatives designated as cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest-rate contracts
|
|
|
|
$
|
3
|
|
|
Net interest revenue
|
|
$
|
(1
|
)
|
|
$
|
(4
|
)
|
|
Net interest revenue
|
|
$
|
1
|
|
|
$
|
2
|
|
|
Foreign exchange contracts
|
$
|
(2
|
)
|
|
(1
|
)
|
|
Net interest revenue
|
|
—
|
|
|
—
|
|
|
Net interest revenue
|
|
2
|
|
|
2
|
|
|||||
Total
|
$
|
(2
|
)
|
|
$
|
2
|
|
|
|
|
$
|
(1
|
)
|
|
$
|
(4
|
)
|
|
|
|
$
|
3
|
|
|
$
|
4
|
|
|
Amount of Gain
(Loss) on Derivative
Recognized in Other
Comprehensive
Income
|
|
Location of Gain (Loss) Reclassified from OCI to Consolidated Statement of Income
|
|
Amount of Gain
(Loss) Reclassified
from OCI to
Consolidated
Statement of Income
|
|
Location of Gain (Loss) on Derivative Recognized in Consolidated Statement of Income
|
|
Amount of Gain
(Loss) on Derivative
Recognized in
Consolidated
Statement of Income
|
|||||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|||||||||||
(In millions)
|
September 30,
2011 |
|
September 30,
2011 |
|
|
|
September 30,
2011 |
|
September 30,
2011 |
|
|
|
September 30,
2011 |
|
September 30,
2011 |
|||||||||||
Derivatives designated as cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Interest-rate contracts
|
$
|
4
|
|
|
$
|
8
|
|
|
Net interest revenue
|
|
$
|
(1
|
)
|
|
$
|
(5
|
)
|
|
Net interest revenue
|
|
|
|
|
$
|
2
|
|
Total
|
$
|
4
|
|
|
$
|
8
|
|
|
|
|
$
|
(1
|
)
|
|
$
|
(5
|
)
|
|
|
|
—
|
|
|
$
|
2
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(In millions)
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Interest revenue:
|
|
|
|
|
|
|
|
||||||||
Deposits with banks
|
$
|
31
|
|
|
$
|
39
|
|
|
$
|
108
|
|
|
$
|
94
|
|
Investment securities:
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury and federal agencies
|
200
|
|
|
186
|
|
|
605
|
|
|
590
|
|
||||
State and political subdivisions
|
53
|
|
|
55
|
|
|
161
|
|
|
166
|
|
||||
Other investments
|
374
|
|
|
374
|
|
|
1,185
|
|
|
1,093
|
|
||||
Securities purchased under resale agreements
|
15
|
|
|
6
|
|
|
37
|
|
|
22
|
|
||||
Loans and leases
|
57
|
|
|
68
|
|
|
183
|
|
|
215
|
|
||||
Other interest-earning assets
|
—
|
|
|
—
|
|
|
2
|
|
|
1
|
|
||||
Total interest revenue
|
730
|
|
|
728
|
|
|
2,281
|
|
|
2,181
|
|
||||
Interest expense:
|
|
|
|
|
|
|
|
||||||||
Deposits
|
37
|
|
|
52
|
|
|
127
|
|
|
154
|
|
||||
Short-term borrowings
|
18
|
|
|
23
|
|
|
55
|
|
|
74
|
|
||||
Long-term debt
|
52
|
|
|
73
|
|
|
172
|
|
|
220
|
|
||||
Other interest-bearing liabilities
|
4
|
|
|
2
|
|
|
11
|
|
|
6
|
|
||||
Total interest expense
|
111
|
|
|
150
|
|
|
365
|
|
|
454
|
|
||||
Net interest revenue
|
$
|
619
|
|
|
$
|
578
|
|
|
$
|
1,916
|
|
|
$
|
1,727
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(In millions)
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Acquisition costs
|
$
|
13
|
|
|
$
|
19
|
|
|
$
|
41
|
|
|
$
|
46
|
|
Restructuring charges, net
|
15
|
|
|
66
|
|
|
45
|
|
|
75
|
|
||||
Total acquisition and restructuring costs
|
$
|
28
|
|
|
$
|
85
|
|
|
$
|
86
|
|
|
$
|
121
|
|
|
|
|
|
|
|
|
|
(In millions)
|
Employee-
Related
Costs
|
|
Real Estate
Consolidation
|
|
Information Technology
Costs
|
|
Fixed-Income Trading Portfolio
|
|
Asset and Other Write-Offs
|
|
Total
|
||||||||||||
Balance at December 31, 2011
|
$
|
162
|
|
|
$
|
39
|
|
|
$
|
33
|
|
|
$
|
38
|
|
|
$
|
15
|
|
|
$
|
287
|
|
Accruals for Business Operations and Information Technology Transformation program
|
21
|
|
|
7
|
|
|
20
|
|
|
—
|
|
|
—
|
|
|
48
|
|
||||||
Net accruals for expense control measures
|
1
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
|
5
|
|
|
(3
|
)
|
||||||
Payments and adjustments
|
(101
|
)
|
|
(6
|
)
|
|
(36
|
)
|
|
(29
|
)
|
|
(6
|
)
|
|
(178
|
)
|
||||||
Balance at September 30, 2012
|
$
|
83
|
|
|
$
|
40
|
|
|
$
|
17
|
|
|
$
|
—
|
|
|
$
|
14
|
|
|
$
|
154
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(Dollars in millions, except per share amounts)
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Net income
|
$
|
674
|
|
|
$
|
555
|
|
|
$
|
1,591
|
|
|
$
|
1,539
|
|
Less:
|
|
|
|
|
|
|
|
||||||||
Preferred stock dividends
(1)
|
(15
|
)
|
|
(6
|
)
|
|
(29
|
)
|
|
(13
|
)
|
||||
Dividends and undistributed earnings allocated to participating securities
(2)
|
(5
|
)
|
|
(6
|
)
|
|
(11
|
)
|
|
(15
|
)
|
||||
Net income available to common shareholders
|
$
|
654
|
|
|
$
|
543
|
|
|
$
|
1,551
|
|
|
$
|
1,511
|
|
|
|
|
|
|
|
|
|
||||||||
Average common shares outstanding (in thousands):
|
|
|
|
|
|
|
|
||||||||
Basic average common shares
|
472,355
|
|
|
490,840
|
|
|
479,536
|
|
|
495,015
|
|
||||
Effect of dilutive securities: common stock options and common stock awards
|
7,655
|
|
|
3,940
|
|
|
6,277
|
|
|
3,402
|
|
||||
Diluted average common shares
|
480,010
|
|
|
494,780
|
|
|
485,813
|
|
|
498,417
|
|
||||
Anti-dilutive securities
(3)
|
5,443
|
|
|
3,636
|
|
|
5,613
|
|
|
2,589
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Earnings per Common Share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.39
|
|
|
$
|
1.11
|
|
|
$
|
3.23
|
|
|
$
|
3.05
|
|
Diluted
(4)
|
1.36
|
|
|
1.10
|
|
|
3.19
|
|
|
3.03
|
|
|
|
|
|
(1)
|
Three and nine months ended September 30, 2012 included
$8 million
related to Series C preferred stock issued in August 2012. Remaining amounts for 2012 periods, and amounts for three and nine months ended September 30, 2011, related to Series A preferred stock, which was redeemed on October 4, 2012.
|
(2)
|
Represented the portion of net income available to common equity allocated to participating securities; participating securities, composed of unvested restricted stock and director stock, have non-forfeitable rights to dividends during the vesting period on a basis equivalent to dividends paid to common shareholders.
|
(3)
|
Represented common stock options and other equity-based awards outstanding, but not included in the computation of diluted average shares because their effect was anti-dilutive.
|
(4)
|
Calculations reflect allocation of earnings to participating securities using the two-class method, as this computation is more dilutive than the calculation using the treasury stock method.
|
|
Three Months Ended September 30,
|
||||||||||||||||||||||||||||||
(Dollars in millions,
except where otherwise noted)
|
Investment
Servicing
|
|
Investment
Management
|
|
Other
|
|
Total
|
||||||||||||||||||||||||
2012
|
|
2011
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|||||||||||||||||
Fee revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Servicing fees
|
$
|
1,100
|
|
|
$
|
1,106
|
|
|
|
|
|
|
|
|
|
|
$
|
1,100
|
|
|
$
|
1,106
|
|
||||||||
Management fees
|
—
|
|
|
—
|
|
|
$
|
251
|
|
|
$
|
229
|
|
|
|
|
|
|
251
|
|
|
229
|
|
||||||||
Trading services
|
232
|
|
|
334
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
232
|
|
|
334
|
|
||||||||||
Securities finance
|
81
|
|
|
77
|
|
|
10
|
|
|
8
|
|
|
|
|
|
|
91
|
|
|
85
|
|
||||||||||
Processing fees and other
|
15
|
|
|
57
|
|
|
30
|
|
|
33
|
|
|
|
|
|
|
45
|
|
|
90
|
|
||||||||||
Total fee revenue
|
1,428
|
|
|
1,574
|
|
|
291
|
|
|
270
|
|
|
|
|
|
|
1,719
|
|
|
1,844
|
|
||||||||||
Net interest revenue
|
600
|
|
|
553
|
|
|
19
|
|
|
25
|
|
|
|
|
|
|
619
|
|
|
578
|
|
||||||||||
Gains related to investment securities, net
|
18
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
18
|
|
|
5
|
|
||||||||||
Total revenue
|
2,046
|
|
|
2,132
|
|
|
310
|
|
|
295
|
|
|
|
|
|
|
|
2,356
|
|
|
2,427
|
|
|||||||||
Expenses from operations
|
1,456
|
|
|
1,475
|
|
|
208
|
|
|
238
|
|
|
|
|
|
|
1,664
|
|
|
1,713
|
|
||||||||||
Claims resolution
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
(362
|
)
|
|
|
|
(362
|
)
|
|
—
|
|
||||||||
Provisions for litigation exposure and other costs
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
85
|
|
|
|
|
85
|
|
|
—
|
|
|||||||||
Acquisition and restructuring costs
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
28
|
|
|
$
|
85
|
|
|
28
|
|
|
85
|
|
|||||||
Total expenses
|
1,456
|
|
|
1,475
|
|
|
208
|
|
|
238
|
|
|
(249
|
)
|
|
85
|
|
|
1,415
|
|
|
1,798
|
|
||||||||
Income (loss) before income tax expense
|
$
|
590
|
|
|
$
|
657
|
|
|
$
|
102
|
|
|
$
|
57
|
|
|
$
|
249
|
|
|
$
|
(85
|
)
|
|
$
|
941
|
|
|
$
|
629
|
|
Pre-tax margin
|
29
|
%
|
|
31
|
%
|
|
33
|
%
|
|
19
|
%
|
|
|
|
|
|
|
|
|
||||||||||||
Average assets (in billions)
|
$
|
191.6
|
|
|
$
|
177.0
|
|
|
$
|
4.2
|
|
|
$
|
4.0
|
|
|
|
|
|
|
$
|
195.8
|
|
|
$
|
181.0
|
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||||||||
(Dollars in millions,
except where otherwise noted)
|
Investment
Servicing
|
|
Investment
Management
|
|
Other
|
|
Total
|
||||||||||||||||||||||||
2012
|
|
2011
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|||||||||||||||||
Fee revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Servicing fees
|
$
|
3,264
|
|
|
$
|
3,325
|
|
|
|
|
|
|
|
|
|
|
$
|
3,264
|
|
|
$
|
3,325
|
|
||||||||
Management fees
|
—
|
|
|
—
|
|
|
$
|
733
|
|
|
$
|
715
|
|
|
|
|
|
|
733
|
|
|
715
|
|
||||||||
Trading services
|
767
|
|
|
947
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
767
|
|
|
947
|
|
||||||||||
Securities finance
|
296
|
|
|
252
|
|
|
35
|
|
|
36
|
|
|
|
|
|
|
331
|
|
|
288
|
|
||||||||||
Processing fees and other
|
112
|
|
|
179
|
|
|
75
|
|
|
73
|
|
|
|
|
|
|
187
|
|
|
252
|
|
||||||||||
Total fee revenue
|
4,439
|
|
|
4,703
|
|
|
843
|
|
|
824
|
|
|
|
|
|
|
5,282
|
|
|
5,527
|
|
||||||||||
Net interest revenue
|
1,854
|
|
|
1,647
|
|
|
62
|
|
|
80
|
|
|
|
|
|
|
1,916
|
|
|
1,727
|
|
||||||||||
Gains (losses) related to investment securities, net
|
48
|
|
|
25
|
|
|
—
|
|
|
—
|
|
|
$
|
(46
|
)
|
|
|
|
2
|
|
|
25
|
|
||||||||
Total revenue
|
6,341
|
|
|
6,375
|
|
|
905
|
|
|
904
|
|
|
(46
|
)
|
|
|
|
7,200
|
|
|
7,279
|
|
|||||||||
Provision for loan losses
|
(1
|
)
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
(1
|
)
|
|
1
|
|
|||||||||
Expenses from operations
|
4,530
|
|
|
4,452
|
|
|
661
|
|
|
701
|
|
|
—
|
|
|
|
|
5,191
|
|
|
5,153
|
|
|||||||||
Claims resolution
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(362
|
)
|
|
|
|
(362
|
)
|
|
—
|
|
|||||||||
Provisions for litigation exposure and other costs
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
107
|
|
|
|
|
107
|
|
|
—
|
|
|||||||||
Acquisition and restructuring costs, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
86
|
|
|
$
|
121
|
|
|
86
|
|
|
121
|
|
|||||||
Total expenses
|
4,530
|
|
|
4,452
|
|
|
661
|
|
|
701
|
|
|
(169
|
)
|
|
121
|
|
|
5,022
|
|
|
5,274
|
|
||||||||
Income (loss) before income tax expense
|
$
|
1,812
|
|
|
$
|
1,922
|
|
|
$
|
244
|
|
|
$
|
203
|
|
|
$
|
123
|
|
|
$
|
(121
|
)
|
|
$
|
2,179
|
|
|
$
|
2,004
|
|
Pre-tax margin
|
29
|
%
|
|
30
|
%
|
|
27
|
%
|
|
22
|
%
|
|
|
|
|
|
|
|
|
||||||||||||
Average assets (in billions)
|
$
|
187.0
|
|
|
$
|
163.4
|
|
|
$
|
4.0
|
|
|
$
|
4.6
|
|
|
|
|
|
|
$
|
191.0
|
|
|
$
|
168.0
|
|
|
|
Three Months Ended September 30
|
|
Nine Months Ended September 30,
|
||||||||||||
(In millions)
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Total fee revenue
|
$
|
700
|
|
|
$
|
757
|
|
|
$
|
2,169
|
|
|
$
|
2,293
|
|
Net interest revenue
|
235
|
|
|
258
|
|
|
709
|
|
|
722
|
|
||||
Losses related to investment securities, net
|
(4
|
)
|
|
(6
|
)
|
|
(36
|
)
|
|
(15
|
)
|
||||
Total revenue
|
931
|
|
|
1,009
|
|
|
2,842
|
|
|
3,000
|
|
||||
Expenses
|
729
|
|
|
791
|
|
|
2,286
|
|
|
2,421
|
|
||||
Income before income taxes
|
202
|
|
|
218
|
|
|
556
|
|
|
579
|
|
||||
Income tax expense
|
51
|
|
|
54
|
|
|
139
|
|
|
146
|
|
||||
Net income
|
$
|
151
|
|
|
$
|
164
|
|
|
$
|
417
|
|
|
$
|
433
|
|
(In millions)
|
September 30,
2012 |
|
December 31,
2011 |
||||
Interest-bearing deposits with banks
|
$
|
18,750
|
|
|
$
|
10,772
|
|
Investment securities
|
28,132
|
|
|
25,376
|
|
||
Other assets
|
11,361
|
|
|
10,246
|
|
||
Total non-U.S. assets
|
$
|
58,243
|
|
|
$
|
46,394
|
|
(Dollars in millions, except per share amounts, shares in thousands)
|
|
Total Number of Shares Purchased Under Publicly Announced Program
|
|
Average Price Paid Per Share
|
|
Approximate Dollar Value of Shares Purchased Under Publicly Announced Program
|
|
Approximate Dollar Value of Shares Yet to be Purchased Under Publicly Announced Program
|
|||||||
Period:
|
|
|
|
|
|
|
|
|
|||||||
July 1 - July 31, 2012
|
|
179
|
|
|
$
|
40.32
|
|
|
$
|
7
|
|
|
$
|
1,313
|
|
August 1 - August 31, 2012
|
|
6,651
|
|
|
41.27
|
|
|
275
|
|
|
1,038
|
|
|||
September 1 - September 30, 2012
|
|
4,568
|
|
|
43.40
|
|
|
198
|
|
|
840
|
|
|||
Total
|
|
11,398
|
|
|
$
|
42.11
|
|
|
$
|
480
|
|
|
$
|
840
|
|
|
|
|
|
|
|
|
|
|
ITEM 6.
|
EXHIBITS
|
|
|
|
|
|
S
TATE
S
TREET
C
ORPORATION
|
|
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
Date:
|
November 2, 2012
|
|
By:
|
|
/s/ E
DWARD
J. R
ESCH
|
|
|
|
|
|
Edward J. Resch,
|
|
|
|
|
|
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
|
|
|
|
|
|
|
Date:
|
November 2, 2012
|
|
By:
|
|
/s/ J
AMES
J. M
ALERBA
|
|
|
|
|
|
James J. Malerba,
|
|
|
|
|
|
Executive Vice President, Corporate Controller and
Chief Accounting Officer
(Principal Accounting Officer)
|
|
|
|
|
*
|
Submitted electronically herewith
|