Derivatives and Hedging Activities (Tables)

The following table summarizes the fair value (including accrued interest) and outstanding notional amounts of derivative instruments and related collateral balances (dollars in millions):


	December 31,
	2023							2022
	Notional Amount		Number of Outstanding Derivative Contracts	Derivative Assets		Derivative Liabilities		Notional Amount		Derivative Assets		Derivative Liabilities
Derivatives designated as hedges
Interest rate swaps — cash flow hedge	$	10,650	17	$	2	$	—	$	5,000	$	1	$	3
Interest rate swaps — fair value hedge	$	8,650	10	2		—		$	4,425	—		2
Derivatives not designated as hedges
Foreign exchange forward contracts(1)	$	29	7	—		—		$	25	—		—
Total gross derivative assets/liabilities(2)				4		—				1		5

Less: collateral held/posted(3)				—		—				—		(5)
Total net derivative assets/liabilities				$	4	$	—			$	1	$	—

(1)The foreign exchange forward contracts have notional amounts of EUR 6 million, GBP 6 million, SGD 1 million, INR 1.1 billion and AUD 2 million as of December 31, 2023, and notional amounts of EUR 6 million, GBP 6 million, SGD 1 million, INR 788 million and AUD 2 million as of December 31, 2022.

(2)In addition to the derivatives disclosed in the table, the Company enters into forward contracts to purchase when-issued mortgage-backed securities and tax exempt single family mortgage revenue bonds as part of its community reinvestment initiatives. At December 31, 2023, the Company had one outstanding contract with a total notional amount of $35 million and an immaterial fair value. At December 31, 2022, the Company had one outstanding contract with a total notional amount of $48 million and an immaterial fair value.

(3)Collateral amounts, which consist of cash and investment securities, are limited to the related derivative asset/liability balance and do not include excess collateral received/pledged.

The following amounts were recorded on the statements of financial condition related to cumulative basis adjustments for fair value hedges (dollars in millions):


	December 31,
	2023				2022
	Carrying Amount of Hedged Liabilities		Cumulative Amount of Fair Value Hedging Adjustment (Decreasing) the Carrying Amount of Hedged Liabilities(1)		Carrying Amount of Hedged Liabilities		Cumulative Amount of Fair Value Hedging Adjustment (Decreasing) the Carrying Amount of Hedged Liabilities(1)
Long-term borrowings	$	8,620	$	—	$	4,386	$	(3)

(1)The balance includes $12 million and $28 million of cumulative hedging adjustments related to discontinued hedging relationships as of December 31, 2023 and 2022, respectively.

The following table summarizes the impact of the derivative instruments on income and indicates where within the consolidated financial statements such impact is reported (dollars in millions):


	Location and Amount of (Losses) Gains Recognized on the Consolidated Statements of Income
		Interest Expense				Other Income
		Long-Term Borrowings		Interest Income (Credit Card)
For the Year Ended December 31, 2023
Total amounts of income and expense line items presented in the consolidated statements of income, where the effects of fair value or cash flow hedges are recorded		$	(855)	$	14,438	$	85

The effects of cash flow and fair value hedging
Gains (losses) on cash flow hedging relationships
Amounts reclassified from OCI into earnings		$	9	$	(91)	$	—

(Losses) gains on fair value hedging relationships
(Losses) gains on hedged items		$	(19)	$	—	$	—
(Losses) gains on interest rate swaps		(80)		—		—
Total (losses) gains on fair value hedging relationships		$	(99)	$	—	$	—




For the Year Ended December 31, 2022
Total amounts of income and expense line items presented in the consolidated statements of income, where the effects of fair value or cash flow hedges are recorded		$	(606)	$	10,632	$	75

The effects of cash flow and fair value hedging
(Losses) gains on cash flow hedging relationships
Amounts reclassified from OCI into earnings		$	(2)	$	(2)	$	—

Gains (losses) on fair value hedging relationships
Gains on hedged items		$	66	$	—	$	—
(Losses) gains on interest rate swaps		(70)		—		—
Total (losses) gains on fair value hedging relationships		$	(4)	$	—	$	—

The effects of derivatives not designated in hedging relationships
Gains on derivatives not designated as hedges		$	—	$	—	$	1




For the Year Ended December 31, 2021
Total amounts of income and expense line items presented in the consolidated statements of income, where the effects of fair value or cash flow hedges are recorded		$	(473)	$	8,717	$	66

The effects of cash flow and fair value hedging
(Losses) gains on cash flow hedging relationships
Amounts reclassified from OCI into earnings		$	(3)	$	—	$	—

Gains (losses) on fair value hedging relationships
Gains on hedged items		$	246	$	—	$	—
(Losses) gains on interest rate swaps		(93)		—		—
Total gains on fair value hedging relationships		$	153	$	—	$	—