Note 20.  Business Segments The Companys reportable segments are primarily based on its individual operating subsidiaries.
Each of the principal operating subsidiaries are headed by a chief executive officer who is responsible for the operation of its business and has the duties and authority commensurate with that position.
Investment gains (losses) and the related income taxes, excluding those of CNA, are included in the Corporate and other segment.
CNAs results are reported in four business segments: Specialty, Commercial, International and Other Non-Core.
Specialty provides a broad array of professional, financial and specialty property and casualty products and services, through a network of independent agents, brokers and managing general underwriters.
Commercial includes property and casualty coverages sold to small businesses and middle market entities and organizations primarily through an independent agency distribution system.
Commercial also includes commercial insurance and risk management products sold to large corporations primarily through insurance brokers.
International provides management and professional liability coverages as well as a broad range of other property and casualty insurance


The total amount of unrecognized tax benefits, if recognized would have affected the effective tax rate by $57.5 million as of December 31, 2016, $59.2 million as of December 31, 2015 and $64.0 million as of December 31, 2014.
The Company recognizes interest and penalties related to unrecognized tax benefits in its provision for income taxes.
During 2016 and 2015 the Company released $2.9 million and $1.4 million related to interest and penalties, respectively and during 2014 it accrued $6.6 million related to interest and penalties.
The Company had $10.2 million and $13.1 million of accrued interest, including minor amounts for penalties, at December 31, 2016 and 2015, respectively.13.


| Equity Price Exposure to Pretax Income | Equity Price Decline 10% | (in millions) | Asset-based management and distribution fees-1 | DAC and DSIC amortization-2(3) | Variable annuity riders: | GMDB and GMIB-3 | GMWB | GMAB | DAC and DSIC amortization-4 | Total variable annuity riders | Equity indexed annuities | Stock market certificates | Total |


Net interest income at RJ Bank increased $106.8 million, or 50%, representing more than all of the $55 million increase in our total net interest earnings.
This increase in net interest income at RJ Bank resulted from the significant decline in market rates that occurred early in the fiscal year, leading to lower interest rates being paid on RJ Banks retail deposit accounts throughout the year.
RJ Bank benefited as the rates on interest earning assets declined at a much slower pace than rates paid on deposits.
The decline in interest rates had a dramatic impact on net interest in the Private Client Group (PCG) segment, which declined $42 million, or 45%.
Interest earned on assets segregated declined $112 million, or 88%, as rates dropped as low as 0.20% for a portion of the year.
Average customer margin balances declined $374 million, or 24%, during 2009, contributing to the decline in interest revenue in the PCG segment.
Net interest earnings in the PCG segment will be negatively affected by our recently introduced multi-bank sweep program.
Begun in mid-September 2009, this program spreads clients cash deposits incrementally across a network of unaffiliated banks in amounts less than the single-bank FDIC insurance limits, thereby extending full insurance coverage on client balances of up to $2.5 million, or $5 million if jointly held.
While the program continues to generate competitive interest earnings for clients, it generates fee income for the PCG segment instead of interest earnings.


| For the Year Ended December 31, | 2015 | (In millions) | Depreciation, depletion and amortization: | Oil and gas property and equipment | Recurring | Additional | Other assets | Asset retirement obligation accretion | Lease operating costs | Gathering and transportation costs | Taxes other than income | Impairments | General and administrative expense | Transaction, reorganization, and separation costs | Financing costs, net | Total |


| Customer-related intangible assets $143,400 | Liabilities | Total identifiable net assets | Goodwill | Total purchase consideration |


available for issuance, subject to adjustment upon a merger, reorganization, stock split or other similar corporate change.
The Company filed a registration statement on Form?S-8 with the SEC with respect to the ESPP.
The common stock is offered for purchase through a series of successive offering periods.
Each offering period will be three months in duration and will begin on the first day of each calendar quarter, with the first?offering period having commenced on January?1, 2008.
The ESPP provides for eligible employees to purchase the common stock at a purchase price equal to 85% of the lesser of (1)?the market value of the common stock on the first day of the offering period or (2)?the market value of the common stock on the last day of the offering period.
The ESPP was approved by our stockholders at our 2008 annual meeting of stockholders.
As of December?31, 2017, 104,597?shares of our common stock had been issued under the ESPP.15.


| SPP Total Portfolio-1 | 2018 | Real estate revenues-2 | Operating expenses | NOI | Adjustments to NOI | Adjusted NOI | Non-SPP adjusted NOI | SPP adjusted NOI | SPP Adjusted NOI % change | Property count-3 | Average capacity (units)(4) | Average annual rent per unit |


Discount Rates  For the domestic pension and postretirement benefit plans, we determine our discount rate based on the estimated rate at which annuity contracts could be purchased to effectively settle the respective benefit obligations.
To assist in this we utilize a yield curve based on Aa-rated corporate non-callable bonds.
Each plans projected cash flow is matched to this yield curve and a present value is developed, which is then used to develop a single equivalent discount rate.
The average duration of our domestic pension obligations was 10 years as of December 31, 2009.
The average duration of our postretirement healthcare obligation was 8 years as of December 31, 2009.
For the foreign pension plans, we either determine our discount rate using the same methodology as described for our domestic pension plan or we determine a discount rate by referencing market yields on high quality corporate bonds in the local markets with the appropriate term as of December 31, 2009.
Expected Return on Assets  For the domestic pension plans, our expected rate of return considers the historical trends of asset class index returns over various market cycles and economic conditions, current market conditions, risk premiums associated with asset classes and long-term inflation rates.
We determine both a short-term and long-term view and then attempt to select a long-term rate of return assumption that matches the duration of our liabilities.
For the foreign pension plans, primarily the U. K.  Pension Plan, we determine the expected rate of return by utilizing a weighted average approach based on the current long-term expected rates of return for each asset category.
The long-term expected rate of return for the equity category is based on the current long-term rates of return available on government bonds and applying suitable risk premiums that consider historical market returns and current market expectations.
Fair Value of Pension Plan Assets The following table presents the fair value of our domestic and foreign pension plan assets as of December 31, 2009 and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value.
See Note 12 for a description of the fair value hierarch


| Year Ended December 31, | 2016 | Balance as of January 1 | Current year increases | Write-offs, recoveries and other -1 | Balance as of December 31, |


| (in millions) Dec. 31,  2004 Dec. 31, 2003 (a) Goodwill resulting from the Merger, July 1, 2004 | Investment Bank | Retail Financial Services | Card Services | Commercial Banking | Treasury & Securities Services | Asset & Wealth Management | Corporate (Private Equity) | Total goodwill |


| 2013 2012 Better (Worse) | On-time performance (a) | Completion factor (b) | Mishandled baggage (c) | Customer complaints (d) |


| $ in millions 2011 2010 | Accruals and other liabilities | Compensation and benefits | Accrued bonus and deferred compensation | Accounts payable | Other current liabilities |


| Intangible assets $220 | Goodwill | Net liabilities | Total net assets acquired |


| December 31, 2016 | AmortizedCost | (in millions) | Fixed maturities, available-for-sale | U.S. Treasury securities and obligations of U.S. government authorities and agencies | Obligations of U.S. states and their political subdivisions | Foreign government bonds | U.S. corporate public securities | U.S. corporate private securities-1 | Foreign corporate public securities | Foreign corporate private securities | Asset-backed securities-2 | Commercial mortgage-backed securities | Residential mortgage-backed securities-3 | Total fixed maturities, available-for-sale-1 | Equity securities, available-for-sale | December 31, 2016 | AmortizedCost | (in millions) | Fixed maturities, held-to-maturity | Foreign government bonds | Foreign corporate public securities | Foreign corporate private securities-5 | Commercial mortgage-backed securities | Residential mortgage-backed securities-3 | Total fixed maturities, held-to-maturity-5 |


Each segregated account is permitted to assume net risk exposures equal to its amount of preferred shares and posted collateral, which in the aggregate was $932,243 thousand and $798,548 thousand at December 31, 2016 and 2015, respectively.
Of this amount, Group had invested $55,536 thousand and $50,000 thousand at December 31, 2016 and 2015, respectively, in the preferred shares.
On April 24, 2014, the Company entered into two collateralized reinsurance agreements with Kilimanjaro Re Limited (“Kilimanjaro”), a Bermuda based special purpose reinsurer, to provide the Company with catastrophe reinsurance coverage.
These agreements are multi-year reinsurance contracts which cover specified named storm and earthquake events.
The first agreement provides up to $250,000 thousand of reinsurance coverage from named storms in specified states of the Southeastern United States.
The second agreement provides up to $200,000 thousand of reinsurance coverage from named storms in specified states of the Southeast, Mid-Atlantic and Northeast regions of the United States and Puerto Rico as well as reinsurance coverage from earthquakes in specified states of the Southeast, Mid-Atlantic, Northeast and West regions of the United States, Puerto Rico and British Columbia.
On November 18, 2014, the Company entered into a collateralized reinsurance agreement with Kilimanjaro Re to provide the Company with catastrophe reinsurance coverage.
This agreement is a multi-year reinsurance contract which covers specified earthquake events.
The agreement provides up to $500,000 thousand of reinsurance coverage from earthquakes in the United States, Puerto Rico and Canada.
On December 1, 2015 the Company entered into two collateralized reinsurance agreements with Kilimanjaro Re to provide the Company with catastrophe reinsurance coverage.
These agreements are multi-year reinsurance contracts which cover named storm and earthquake events.
The first agreement provides up to $300,000 thousand of reinsurance coverage from named storms and earthquakes in the United States, Puerto Rico and Canada.
The second agreement provides up to $325,000 thousand of reinsurance coverage from named storms and earthquakes in the United States, Puerto Rico and Canada.
Kilimanjaro has financed the various property catastrophe reinsurance coverage by issuing catastrophe bonds to unrelated, external investors.
On April 24, 2014, Kilimanjaro issued $450,000 thousand of notes (“Series 2014-1 Notes”).
On November 18, 2014, Kilimanjaro issued $500,000 thousand of notes (“Series 2014-2 Notes”).
On December 1, 2015, Kilimanjaro issued $625,000 thousand of notes (“Series 2015-1 Notes).
The proceeds from the issuance of the Series 2014-1 Notes, the Series 2014-2 Notes and the Series 2015-1 Notes are held in reinsurance trust throughout the duration of the applicable reinsurance agreements and invested solely in US government money market funds with a rating of at least “AAAm” by Standard & Poor’s.
RISKS RELATING TO OUR BUSINESS Fluctuations in the financial markets could result in investment losses.
Prolonged and severe disruptions in the overall public debt and equity markets, such as occurred during 2008, could result in significant realized and unrealized losses in our investment portfolio.
Although financial markets have significantly improved since 2008, they could deteriorate in the future.
There could also be disruption in individual market sectors, such as occurred in the energy sector in recent years.
Such declines in the financial markets could result in significant realized and unrealized losses on investments and could have a material adverse impact on our results of operations, equity, business and insurer financial strength and debt ratings.
Our results could be adversely affected by catastrophic events.
We are exposed to unpredictable catastrophic events, including weather-related and other natural catastrophes, as well as acts of terrorism.
Any material reduction in our operating results caused by the occurrence of one or more catastrophes could inhibit our ability to pay dividends or to meet our interest and principal payment obligations.
By way of illustration, during the past five calendar years, pre-tax catastrophe losses, net of contract specific reinsurance but before cessions under corporate reinsurance programs, were as follows:


Notes to Consolidated Financial Statements (continued) Management performs detailed reviews of its receivables on a monthly and/or quarterly basis to assess the adequacy of the allowances based on historical and current trends and other factors affecting credit losses and to determine if any impairment has occurred.
A receivable is impaired when it is probable that all amounts related to the receivable will not be collected according to the contractual terms of the agreement.
In circumstances where the company is aware of a specific customers inability to meet its financial obligations, a specific reserve is recorded against amounts due to reduce the net recognized receivable to the amount reasonably expected to be collected.
Additions to the allowances for doubtful accounts are maintained through adjustments to the provision for credit losses, which are charged to current period earnings; amounts determined to be uncollectable are charged directly against the allowances, while amounts recovered on previously charged-off accounts increase the allowances.
Net charge-offs include the principal amount of losses charged off as well as charged-off interest and fees.
Recovered interest and fees previously charged-off are recorded through the allowances for doubtful accounts and increase the allowances.
Finance receivables are assessed for chargeoff when an account becomes 120 days past due and are charged-off typically within 60 days of asset repossession.
Contract receivables related to equipment leases are generally charged-off when an account becomes 150 days past due, while contract receivables related to franchise finance and van leases are generally charged off up to 180 days past the asset return.
For finance and contract receivables, customer bankruptcies are generally charged-off upon notification that the associated debt is not being reaffirmed or, in any event, no later than 180 days past due.
Snap-on does not believe that its trade accounts, finance or contract receivables represent significant concentrations of credit risk because of the diversified portfolio of individual customers and geographical areas.
See Note 3 for further information on receivables and allowances for doubtful accounts.
Other accrued liabilities: Supplemental balance sheet information for Other accrued liabilities as of 2012 and 2011 year end is as follows:


exchanged installment notes totaling approximately $4.8 billion and approximately $400 million of International Paper promissory notes for interests in entities formed to monetize the notes.
International Paper determined that it was not the primary beneficiary of these entities, and therefore should not consolidate its investments in these entities.
During 2006, these entities acquired an additional $4.8 billion of International Paper debt securities for cash, resulting in a total of approximately $5.2 billion of International Paper debt obligations held by these entities at December 31, 2006.
Since International Paper has, and intends to affect, a legal right to offset its obligations under these debt instruments with its investments in the entities, International Paper has offset $5.0 billion of interest in the entities against $5.0 billion of International Paper debt obligations held by the entities as of December 31, 2007.  International Paper also holds variable interests in two financing entities that were used to monetize long-term notes received from sales of forestlands in 2002 and 2001.
See Note 8 of the Notes to Consolidated Financial Statements in Item 8.
Financial Statements and Supplementary Data for a further discussion of these transactions.
Capital Resources Outlook for 2008 International Paper expects to be able to meet projected capital expenditures, service existing debt and meet working capital and dividend requirements during 2008 through current cash balances and cash from operations, supplemented as required by its various existing credit facilities.
International Paper has approximately $2.5 billion of committed bank credit agreements, which management believes is adequate to cover expected operating cash flow variability during our industrys economic cycles.
The agreements generally provide for interest rates at a floating rate index plus a pre-determined margin dependent upon International Papers credit rating.
The agreements include a $1.5 billion fully committed revolving bank credit agreement that expires in March 2011 and has a facility fee of 0.10% payable quarterly.
These agreements also include up to $1.0 billion of available commercial paper-based financings under a receivables securitization program that expires in October 2009 with a facility fee of 0.10%.
At December 31, 2007, there were no borrowings under either the bank credit agreements or receivables securitization program.
The Company will continue to rely upon debt and capital markets for the majority of any necessary long-term funding not provided by operating cash flows.
Funding decisions will be guided by our capital structure planning objectives.
The primary goals of the Companys capital structure planning are to maximize financial flexibility and preserve liquidity while reducing interest expense.
The majority of International Papers debt is accessed through global public capital markets where we have a wide base of investors.
The Company was in compliance with all its debt covenants at December 31, 2007.
Principal financial covenants include maintenance of a minimum net worth, defined as the sum of common stock, paid-in capital and retained earnings, less treasury stock, plus any goodwill impairment charges, of $9 billion; and a maximum total debt to capital ratio, defined as total debt divided by total debt plus net worth, of 60%.
Maintaining an investment grade credit rating is an important element of International Papers financing strategy.
At December 31, 2007, the Company held long-term credit ratings of BBB (stable outlook) and Baa3 (stable outlook) by Standard & Poors (S&P) and Moodys Investor Services (Moodys), respectively.
The Company currently has short-term credit ratings by S&P and Moodys of A-2 and P-3, respectively.
Contractual obligations for future payments under existing debt and lease commitments and purchase obligations at December 31, 2007, were as follows:


| Real Estate | Commercial, Financial, Leasing, etc. | (In thousands) | December 31, 2015 | Pass | Criticized accrual | Criticized nonaccrual | Total | December 31, 2014 | Pass | Criticized accrual | Criticized nonaccrual | Total |


Financing activities for 2014 also included an acquisition-related contingent consideration payment of $86 million made to Champion’s former shareholders.
Liquidity and Capital Resources We currently expect to fund all of our cash requirements which are reasonably foreseeable for 2017, including scheduled debt repayments, new investments in the business, share repurchases, dividend payments, possible business acquisitions and pension contributions, with cash from operating activities, and as needed, additional short-term and/or long-term borrowings.
We continue to expect our operating cash flow to remain strong.
As of December 31, 2016, we had $327 million of cash and cash equivalents on hand, of which $184 million was held outside of the U. S.  As of December 31, 2015, we had $26 million of deferred tax liabilities for pre-acquisition foreign earnings associated with the legacy Nalco entities and legacy Champion entities that we intended to repatriate.
These liabilities were recorded as part of the respective purchase price accounting of each transaction.
The remaining foreign earnings were repatriated in 2016, reducing the deferred tax liabilities to zero at December 31, 2016.
We consider the remaining portion of our foreign earnings to be indefinitely reinvested in foreign jurisdictions and we have no intention to repatriate such funds.
We continue to be focused on building our global business and these funds are available for use by our international operations.
To the extent the remaining portion of the foreign earnings would be repatriated, such amounts would be subject to income tax or foreign withholding tax liabilities that may be fully or partially offset by foreign tax credits, both in the U. S.  and in various applicable foreign jurisdictions.
As of December 31, 2016 we had a $2.0 billion multi-year credit facility, which expires in December 2019.
The credit facility has been established with a diverse syndicate of banks.
There were no borrowings under our credit facility as of December 31, 2016 or 2015.
The credit facility supports our $2.0 billion U. S.  commercial paper program and $2.0 billion European commercial paper program.
We increased the European commercial paper program from $200 million during the third quarter of 2016.
Combined borrowing under these two commercial paper programs may not exceed $2.0 billion.
As of December 31, 2016, we had no amount outstanding under either our U. S.  or European commercial paper programs.
Additionally, we have other committed and uncommitted credit lines of $746 million with major international banks and financial institutions to support our general global funding needs, including with respect to bank supported letters of credit, performance bonds and guarantees.
Approximately $554 million of these credit lines were available for use as of year-end 2016.
As of December 31, 2016, our short-term borrowing program was rated A-2 by Standard & Poor’s and P-2 by Moody’s.
As of December 31, 2016, Standard & Poor’s and Moody’s rated our long-term credit at A- (stable outlook) and Baa1 (stable outlook), respectively.
A reduction in our credit ratings could limit or preclude our ability to issue commercial paper under our current programs, or could also adversely affect our ability to renew existing, or negotiate new, credit facilities in the future and could increase the cost of these facilities.
Should this occur, we could seek additional sources of funding, including issuing additional term notes or bonds.
In addition, we have the ability, at our option, to draw upon our $2.0 billion of committed credit facility prior to termination.
We are in compliance with our debt covenants and other requirements of our credit agreements and indentures.


CORPORATE AND SHAREHOLDER INFORMATION Home Office CarMax, Inc.  12800 Tuckahoe Creek Parkway Richmond, Virginia 23238 Telephone: (804) 747-0422 Website www.
carmax.
com Annual Shareholders Meeting Tuesday, June 24, 2008, at 8:30 a. m.  EDT The Richmond Marriott West Hotel 4240 Dominion Boulevard Glen Allen, Virginia 23060 Stock Information CarMax, Inc.  common stock is traded on the New York Stock Exchange under the ticker symbol KMX.
At February 29, 2008, there were approximately 7,000 CarMax shareholders of record.
Quarterly Stock Price Range The following table sets forth by fiscal quarter the high and low reported prices of our common stock for the last two fiscal years, adjusted for the March 2007 2-for-1 stock split.


| December 31, | (In thousands) | Net unfunded commitments to extend credit1 | Standby letters of credit: | Financial | Performance | Commercial letters of credit | Total unfunded lending commitments |


Volume includes cans and packs sold, as well as promotional units, but excludes international volume, which is not material to the smokeless products segment.
Other includes certain USSTC and PM USA smokeless products.
New types of smokeless products, as well as new packaging configurations


| (In millions) 2007 2006 2005 | Included in Operating profit | Equity in net earnings (losses) of equity investees | Gain on sale of Comsat International | Gain on sales of land | Earnings from reversal of legal reserves due to settlement | Gains on sales of various investment interests | Earnings from expiration of AES transaction indemnification | Gain on sale of Space Imaging’s assets | Other activities, net | $293 | Included in Non-operating income (expense), net | Interest income | Debt-related expenses and charges | $193 |


Revenues for the Marine Systems group were 20 percent of our consolidated revenues in 2009, 19 percent in 2008 and 18 percent in 2007.
Revenues by major products and services were as follows:


| December 31, | 2009 | Senior secured debt financing facility: | Term loans payable | Revolving credit facility | Notes payable to individuals through August 2019, interest at 2.0% to 10.0% | 603,045 | Less current maturities | $592,982 |


| Years ended June 30 | 2008 | Stock Options: | Weighted average grant date fair value | Weighted average risk-free interest rate | Dividend yield | Expected option life in years | Volatility | ESPP Purchase rights: | Weighted average risk-free interest rate | Dividend yield | Expected option life | Volatility |


Pursuant to the terms of certain share-based compensation plans, employees may remit shares to the firm or the firm may cancel RSUs or stock options to satisfy minimum statutory employee tax withholding requirements and the exercise price of stock options.
Under these plans, during 2017, 2016 and 2015, 12,165 shares, 49,374 shares and 35,217 shares were remitted with a total value of $3 million, $7 million and $6 million, and the firm cancelled 8.1 million, 6.1 million and 5.7 million of RSUs with a total value of $1.94 billion, $921 million and $1.03 billion, respectively.
Under these plans, the firm also cancelled 4.6 million, 5.5 million and 2.0 million of stock options with a total value of $1.09 billion, $1.11 billion and $406 million during 2017, 2016 and 2015, respectively.


The company did not purchase shares in the open market during the twelve months ended December 31, 2017 (year ended December 31, 2016: 18.1 million shares at a cost of $535.0 million).
Separately, an aggregate of 1.9 million shares were withheld on vesting events during the year ended December 31, 2017 to meet employees' withholding tax obligations (December 31, 2016: 1.5 million).
The fair value of these shares withheld at the respective withholding dates was $63.8 million (December 31, 2016: $42.0 million).
At December 31, 2017, approximately $1,643.0 million remained authorized under the company's share repurchase authorizations approved by the Board on October 11, 2013 and July 22, 2016 (December 31, 2016: $1,643.0 million).
Total treasury shares at December 31, 2017 were 92.4 million (December 31, 2016: 95.9 million), including 9.1 million unvested restricted stock awards (December 31, 2016: 9.3 million) for which dividend and voting rights apply.
The market price of common shares at the end of 2017 was $36.54.
The total market value of the company's 92.4 million treasury shares was $3.4 billion at December 31, 2017.
Movements in Treasury Shares comprise:


Risk Management and Financial Instruments American’s economic prospects are heavily dependent upon two variables it cannot control: the health of the economy and the price of fuel.
Due to the discretionary nature of business and leisure travel spending, airline industry revenues are heavily influenced by the condition of the U. S.  economy and economies in other regions of the world.
Unfavorable conditions in these broader economies have resulted, and may result in the future, in decreased passenger demand for air travel and changes in booking practices, both of which in turn have had, and may have in the future, a strong negative effect on American’s revenues.
In addition, during challenging economic times, actions by our competitors to increase their revenues can have an adverse impact on American’s revenues.
American’s operating results are materially impacted by changes in the availability, price volatility and cost of aircraft fuel, which represents one of the largest single cost items in American’s business.
Because of the amount of fuel needed to operate American’s business, even a relatively small increase in the price of fuel can have a material adverse aggregate effect on American’s operating results and liquidity.
Jet fuel market prices have fluctuated substantially over the past several years and prices continued to be volatile in 2014.
These factors could impact American’s results of operations, financial performance and liquidity.
(a) Fuel Price Risk Management During the second quarter of 2014, American sold its portfolio of fuel hedging contracts that were scheduled to settle on or after June 30, 2014.
American has not entered into any transactions to hedge its fuel consumption since December 9, 2013 and, accordingly, as of December 31, 2014, American did not have any fuel hedging contracts outstanding.
As such, and assuming American does not enter into any future transactions to hedge its fuel consumption, American will continue to be fully exposed to fluctuations in fuel prices.
American’s current policy is not to enter into transactions to hedge its fuel consumption, although American reviews that policy from time to time based on market conditions and other factors.


| (in 000s, except per share amounts) | April 30, | Revenues | Net income from continuing operations | Net income (loss) | Basic earnings (loss) per share: | Net income from continuing operations | Net income (loss) | Diluted earnings (loss) per share: | Net income from continuing operations | Net income (loss) | Total assets | Long-term debt-1 | Stockholders’ equity | Shares outstanding | Dividends per share-2 |


(o) Stock-Based Compensation The Company recognizes compensation expense for all share-based payments granted based on the grant-date fair value estimated in accordance with ASC 718-10, Stock Compensation.
Compensation expense is generally recognized on a straight-line basis over the awards estimated lives for fixed awards with ratable vesting provisions.


| Millions OperatingLeases CapitalLeases | 2013 | 2014 | 2015 | 2016 | 2017 | Later years | Total minimum leasepayments | Amount representing interest | Present value of minimum leasepayments |


| 2011 2010 2009 | CommonSharesIssued | Beginning Balance, January 1 | Equity Unit Transaction | Repurchases | Issuances: | Employee Stock-BasedCompensation Plans | Directors’ Plan | Ending Balance, December 31 |


| 2006 2005 | (in millions) | Available-for-sale investments | Amortized cost | Gross unrealized gains | Gross unrealized losses | Fair value | Equity method investments | Cost | Equity in losses | Carrying value | Cost method investments | Carrying value | $596 |


| $ in millions Amortized Cost Fair Value Weighted Average Yield | As of December 2018 | Less than 5 years | Greater than 5 years | Total U.S. government obligations | Totalavailable-for-salesecurities | As of December 2017 | Less than 5 years | Greater than 5 years | Total U.S. government obligations | Less than 5 years | Greater than 5 years | Total otheravailable-for-salesecurities | Totalavailable-for-salesecurities |


Entergy Corporation and Subsidiaries Notes to Financial Statements 68 Nuclear Refueling Outage Costs Nuclear refueling outage costs are deferred during the outage and amortized over the estimated period to the next outage because these refueling outage expenses are incurred to prepare the units to operate for the next operating cycle without having to be taken off line.
Allowance for Funds Used During Construction (AFUDC) AFUDC represents the approximate net composite interest cost of borrowed funds and a reasonable return on the equity funds used for construction by the Registrant Subsidiaries.
AFUDC increases both the plant balance and earnings and is realized in cash through depreciation provisions included in rates.
Income Taxes Entergy Corporation and the majority of its subsidiaries file a United States consolidated federal income tax return.
Each tax paying entity records income taxes as if it were a separate taxpayer and consolidating adjustments are allocated to the tax filing entities in accordance with Entergy's intercompany income tax allocation agreement.
Deferred income taxes are recorded for all temporary differences between the book and tax basis of assets and liabilities, and for certain credits available for carryforward.
Entergy Louisiana, formed December 31, 2005, was not a member of the consolidated group in 2006 and 2007 and filed a separate federal income tax return.
Beginning January 1, 2008, Entergy Louisiana joined the Entergy consolidated federal income tax return.
Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of the deferred tax assets will not be realized.
Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates in the period in which the tax or rate was enacted.
Investment tax credits are deferred and amortized based upon the average useful life of the related property, in accordance with ratemaking treatment.


(1) Effective January 1, 2008, upon adoption of SFAS 157, the valuation of the Companys guaranteed minimum benefit riders includes an adjustment for the Companys own credit.
Included in net investment gains (losses) for the year ended December 31, 2008 are gains of $2,994 million in connection with this adjustment.
Credit Risk The Company may be exposed to credit-related losses in the event of nonperformance by counterparties to derivative financial instruments.
Generally, the current credit exposure of the Companys derivative contracts is limited to the net positive estimated fair value of derivative contracts at the reporting date after taking into consideration the existence of netting agreements and any collateral received pursuant to credit support annexes.
The Company manages its credit risk related to over-the-counter derivatives by entering into transactions with creditworthy counterparties, maintaining collateral arrangements and through the use of master agreements that provide for a single net payment to be made by one counterparty to another at each due date and upon termination.
Because exchange traded futures are effected through regulated exchanges, and positions are marked to market on a daily basis, the Company has minimal exposure to credit-related losses in the event of nonperformance by counterparties to such derivative instruments.
See Note 24 for a description of the impact of credit risk on the valuation of derivative instruments.
The Company enters into various collateral arrangements, which require both the pledging and accepting of collateral in connection with its derivative instruments.
At December 31, 2008 and 2007, the Company was obligated to return cash collateral under its control of $7,758 million and $833 million, respectively.
This unrestricted cash collateral is included in cash and cash equivalents or in short-term investments and the obligation to return it is included in payables for collateral under securities loaned and other transactions in the consolidated balance sheets.
At December 31, 2008 and 2007, the Company had also accepted collateral consisting of various securities with a fair market value of $1,249 million and $678 million, respectively, which are held in separate custodial accounts.
The Company is permitted by contract to sell or repledge this collateral, but at December 31, 2008, none of the collateral had been sold or repledged.
At December 31, 2008 and 2007, the Company provided securities collateral for various arrangements in connection with derivative instruments of $776 million and $162 million, respectively, which is included in fixed maturity securities.
The counterparties are permitted by contract to sell or repledge this collateral.
In addition, the Company has exchange-traded futures, which require the pledging of collateral.
At December 31, 2008 and 2007, the Company pledged securities collateral for exchange-traded futures of $282 million and $167 million, respectively, which is included in fixed maturity securities.
The counterparties are permitted by contract to sell or repledge this collateral.
At December 31, 2008 and 2007, the Company provided cash collateral for exchange-traded futures of $686 million and $102 million, respectively, which is included in premiums and other receivables.
In connection with synthetically created investment transactions and credit default swaps held in relation to the trading portfolio, the Company writes credit default swaps for which it receives a premium to insure credit risk.
If a credit event, as defined by the contract, occurs generally the contract will require the Company to pay the counterparty the specified swap notional amount in exchange for the delivery of par quantities of the referenced credit obligation.
The Companys maximum amount at risk, assuming the value of all referenced credit obligations is zero, was $1,875 million at December 31, 2008.
The Company can terminate these contracts at any time through cash


| 2007 2006 2005 | Dollars in millions | Federal funds purchased | Year-end balance | Average during year | Maximum month-end balance during year | December 31, 2007In millions | Commercial | Real estate projects | Total | Loans with Predetermined rate | Floating or adjustable rate | Total | December 31, 2007 – in millions | Three months or less | Over three through six months | Over six through twelve months | Over twelve months | Total |


| For the   Years Ended December 31, | 2009 | (In millions) | Instrument-specific credit risk based on changes in credit spreads for non-agency loans and adjustments in individual loan quality | Other changes in estimated fair value | Total gains (losses) recognized in other revenues |


(1) "Owned and Leased Capability" is the dependable load carrying capability as demonstrated under actual operating conditions based on the primary fuel (assuming no curtailments) that each station was designed to utilize.
The Entergy System's load and capacity projections are reviewed periodically to assess the need and timing for additional generating capacity and interconnections.
These reviews consider existing and projected demand, the availability and price of power, the location of new load, and the economy.
Summer peak load in the Entergy System service territory has averaged 21,039 MW from 2002-2008.
Due to changing use patterns, peak load growth has nearly flattened while annual energy use continues to grow.
In the 2002 time period, the Entergy System's long-term capacity resources, allowing for an adequate reserve margin, were approximately 3,000 MW less than the total capacity required for peak period demands.
In this time period Entergy met its capacity shortages almost entirely through short-term power purchases in the wholesale spot market.
In the fall of 2002, the Entergy System began a program to add new resources to its existing generation portfolio and began a process of issuing


| 2003 2002 2001 | (In thousands, except per share data) | Net income: | As reported | Total stock-based employee compensation expense determined under fair value method for all awards, net of related taxeffects | Pro forma net income | Basic earnings per share | As reported | Pro forma | Diluted earnings per share: | As reported | Pro forma |


Commercial Banking net income increased $13.1 million in 2013 compared to 2012.
The $14.7 million increase in net interest income primarily reflects continued loan growth and lower FTP funding charges, partially offset by continued repricing pressure within the loan portfolio, including the pay-off of higher-yielding loans, new loan originations at lower yields and lower interest income on acquired loans.
The $11.3 million increase in non-interest income in 2013 reflects increases in commercial banking fees and operating lease income resulting from a higher level of equipment leased to PCLC customers.
Included in non-interest income in 2013 and 2012 are net gains on sales of acquired loans totaling $5.7 million and $1.0 million, respectively.
The $7.0 million increase in non-interest expense in 2013 reflects a higher level of direct expenses primarily due to increased operating lease expense, partially offset by a decrease in allocated expenses in 2013 compared to 2012.
Average total assets increased $1.7 billion and average total liabilities increased $367 million compared to 2012, reflecting loan and deposit growth.


Investing Activities.
Cash provided by investing activities totaled $99.3 million compared to $329.5 million in the prior year.
This decrease is principally due to the sale of our AFS securities in the prior year, partially offset by the sale of our portfolio of mortgage loans in the current year, a decrease of $34.0 million in payments for business acquisitions, and a decrease of $10.7 million in capital expenditures.


| Years Ended December 31, | (in millions) | Operating Revenues | Net Income Attributable to Duke Energy Corporation |


| As of December 31, 2017 | $ in millions | Cash and cash equivalents | Fund investments | Equity securities | Government debt securities | Other assets | Guaranteed investments contracts | Total |


| 2015 2014 2013 | Total common stockholders' equity | Long-term debt and redeemable preferred stock at redemption value | Short-term debt and current portion of long-term debt | Total |


| (in millions) Shares Outstanding at September 30, 2009 Conversion Rate Into Class A Common Stock As Converted | Class A common stock | Class B common stock | Class C common stock | 846 |


Backlog N&SS total backlog decreased by 12% in 2008 compared with 2007 primarily due to revenues recognized on multi-year orders received in prior years on FCS, GMD and C3 programs, partially offset by an increase in the International Space Station program.
Total backlog decreased by 7% in 2007 compared with 2006 due to revenues recognized on FCS and Proprietary programs, partially offset by an increase in Space Exploration programs.


Notes to the Consolidated Financial Statements at a price equal to 101% of their principal amount plus accrued and unpaid interest.
Cash proceeds from the sale of these notes was $983 million (net of discount and issuance costs).
The discount and issuance costs related to these notes, which totaled $17 million, will be amortized to interest expense over the respective terms of the notes.
In August 2010, PPG entered into a three-year credit agreement with several banks and financial institutions (the Credit Agreement).
The Credit Agreement provides for a $1.2 billion unsecured revolving credit facility.
In connection with entering into this Credit Agreement, the Notes to the Consolidated Financial Statements at a price equal to 101% of their principal amount plus accrued and unpaid interest.
Cash proceeds from the sale of these notes was $983 million (net of discount and issuance costs).
The discount and issuance costs related to these notes, which totaled $17 million, will be amortized to interest expense over the respective terms of the notes.
In August 2010, PPG entered into a three-year credit agreement with several banks and financial institutions (the Â¡Â°Credit AgreementÂ¡Â±).
The Credit Agreement provides for a $1.2 billion unsecured revolving credit facility.
In connection with entering into this Credit Agreement, the Company terminated its ¬650 million and its $1 billion revolving credit facilities that were each set to expire in 2011.
There were no outstanding amounts due under either revolving facility at the times of their termination.
The Company has the ability to increase the size of the Credit Agreement by up to an additional $300 million, subject to the receipt of lender commitments and other conditions.
The Credit Agreement will terminate and all amounts outstanding will be due and payable on August 5, 2013.
The Credit Agreement provides that loans will bear interest at rates based, at the CompanyÂ¡Â¯s option, on one of two specified base rates plus a margin based on certain formulas defined in the Credit Agreement.
Additionally, the Credit Agreement contains a commitment fee on the amount of unused commitment under the Credit Agreement ranging from 0.125% to 0.625% per annum.
The applicable interest rate and the fee will vary depending on the ratings established by Standard & PoorÂ¡Â¯s Financial Services LLC and MoodyÂ¡Â¯s Investor Service Inc.  for the CompanyÂ¡Â¯s non-credit enhanced, longterm, senior, unsecured debt.
There were no amounts outstanding under the credit agreement at December 31, 2011; however, the available borrowing rate on a one month, U. S.  dollar denominated borrowing would have been 1.05 percent.
The Credit Agreement contains usual and customary restrictive covenants for facilities of its type, which include, with specified exceptions, limitations on the CompanyÂ¡Â¯s ability to create liens or other encumbrances, to enter into sale and leaseback transactions and to enter into consolidations, mergers or transfers of all or substantially all of its assets.
The Credit Agreement also requires the Company to maintain a ratio of total indebtedness to total capitalization, as defined in the Credit Agreement, of 60 percent or less.
The Credit Agreement contains customary events of default that would permit the lenders to accelerate the repayment of any loans, including the failure to make timely payments when due under the Credit Agreement or other material indebtedness, the failure to satisfy covenants contained in the Credit Agreement, a change in control of the Company and specified events of bankruptcy and insolvency.
PPGÂ¡Â¯s non-U.
S.  operations have uncommitted lines of credit totaling $679 million of which $36 million was used as of December 31, 2011.
These uncommitted lines of credit are subject to cancellation at any time and are generally not subject to any commitment fees.
Short-term debt outstanding as of December 31, 2011 and 2010, was as follows:


| Table 55 Allowance for Credit Losses (continued) | (Dollars in millions) | Loan and allowance ratios: | Loans and leases outstanding at December 31-5 | Allowance for loan and lease losses as a percentage of total loans and leases and outstanding at December 31-5 | Consumer allowance for loan and lease losses as a percentage of total consumer loans outstanding at December 31-6 | Commercial allowance for loan and lease losses as a percentage of total commercial loans and leases outstanding at December 31-7 | Average loans and leases outstanding-5 | Net charge-offs as a percentage of average loans and leases outstanding-5 | Allowance for loan and lease losses as a percentage of total nonperforming loans and leases at December 31-5, 8 | Ratio of the allowance for loan and lease losses at December 31 to net charge-offs | Amounts included in allowance for loan and lease losses that are excluded from nonperforming loans and leases at December 31-9 | Allowance for loan and lease losses as a percentage of total nonperforming loans and leases excluding amounts included in the allowance for loan and lease losses that are excluded from nonperforming loans and leases at December 31-9 | Loan and allowance ratios excluding purchased credit-impaired loans: | Allowance for loan and lease losses as a percentage of total loans and leases outstanding at December 31-5 | Consumer allowance for loan and lease losses as a percentage of total consumer loans outstanding at December 31-6 | Commercial allowance for loan and lease losses as a percentage of total commercial loans and leases outstanding at December 31-7 | Net charge-offs as a percentage of average loans and leases outstanding-5 | Allowance for loan and lease losses as a percentage of total nonperforming loans and leases at December 31-5, 8 | Ratio of the allowance for loan and lease losses at December 31 to net charge-offs |


Operating Income Operating income for Fiscal 2011 was $664.6 million, representing 10.8% of net sales, as compared to $584.9 million, or 9.9% of net sales, for Fiscal 2010, an increase of 90 basis points.
This increase was due to a lower SG&A rate partially offset by a slightly lower gross profit rate.
AAP produced operating income of $653.1 million, or 11.1% of net sales, for Fiscal 2011 as compared to $580.4 million, or 10.2% of net sales, for Fiscal 2010.
AI generated operating income for Fiscal 2011 of $11.5 million as compared to $4.5 million for Fiscal 2010.
AI's operating income increased during Fiscal 2011 primarily due to the leverage of SG&A as a result of its improved comparable store sales and decelerated pace of new store openings in Fiscal 2011.


Capital allocation Each business segment is allocated capital by taking into consideration stand- alone peer comparisons, economic risk measures and regulatory capital requirements.
The amount of capital assigned to each business is referred to as equity.
Effective January 1, 2006, the Firm refined its methodology for allo- cating capital to the business segments.
As prior periods have not been revised to reflect the new capital allocations, certain business metrics, such as ROE, are not comparable to the current presentations.
For a further discussion of this change, see Capital managementLine of business equity on page 57 of this Annual Report.


| Renegotiated TDRs Entered into During 2011 December 31, 2011 | (Dollars in millions) | U.S. credit card | Non-U.S. credit card | Direct/Indirect consumer | Total renegotiated TDR loans |


Investment Servicing The 14% increase in total revenue from 2005 was primarily driven by increases in servicing and trading services fees and securities finance revenue, as well as a 19% increase in net interest revenue, slightly offset by a decline in processing fees and other revenue.
Servicing fees were up from 2005 due to net new business from existing and new customers, higher equity valuations and higher customer transaction volumes.
The increase in trading services revenue reflected a higher dollar volume of foreign exchange trades for customers and a higher volume of fixed income transition management business.
Processing fees and other revenue declined from 2005, partly as a result of a decline in fees from Deutsche Bank AG as GSS customer deposits were converted to our systems.
Servicing and trading services fees and gains (losses) on sales of available-for-sale securities for our Investment Servicing business line are identical to the respective consolidated results.
Refer to the Servicing Fees, Trading Services and Gains (Losses) on Sales of Available-For-Sale Securities, Net captions in the Total Revenue section of this Managements Discussion and Analysis for a more in-depth discussion.
A discussion of processing fees and other revenue is provided under the caption Processing Fees and Other in the Total Revenue section.
Net interest revenue for 2006 increased 19% from 2005 due to an increase in average interest-earning assets, as well as higher yields on our investment securities portfolio.
The higher yields were the result of a repositioning program begun in late 2004 and substantially completed in the second half of 2006, which is further discussed under the caption Net Interest Revenue in the Total Revenue section of this
other short-term borrowings.
Additional information about deposits, federal funds purchased, securities sold under repurchase agreements and other short-term borrowings is in Notes 7 and 8 of the Notes to Consolidated Financial Statements, included in this Form 10-K under Item 8.
The table does not include obligations related to derivative contracts, because the amounts included in our consolidated statement of condition at December 31, 2006 related to derivative contracts do not represent the amounts that may ultimately be paid under the contracts.
Additional information about derivative contracts is in Note 15 of the Notes to Consolidated Financial Statements included in this Form 10-K under Item 8.
We have obligations under pension and other postretirement benefit plans, which are more fully described in Note 17 of the Notes to Consolidated Financial Statements, which are not included in the above table.
Additional information about contractual cash obligations related to long-term debt and operating and capital leases is in Notes 9 and 18 of the Notes to Consolidated Financial Statements.
 The consolidated statement of cash flows, included in this Form 10-K under Item 8, provides additional liquidity information.


| (in millions) December 31,2016 Net inflows (outflows) Marketchange FXimpact December 31,2017 | Asset allocation and balanced | Target date/risk | Fiduciary | FutureAdvisor-1 | Total |


| Years Ended December 31, | (Millions, except percentages) | Marketing and promotion | Card Member rewards | Card Member services and other | Total marketing, promotion, rewards and Card Member services and other | Salaries and employee benefits | Other, net(a) | Total expenses |


| ($ in millions) Level 1-1 Level 2-1 Level 3-1 Total | Asset Category | Equity securities: | U.S. | Large cap | Small cap | PPG common stock | Non-U.S. | Developed and emerging markets-2 | Debt securities: | Cash and cash equivalents | Corporate-3 | U.S.-4 | Developed and emerging markets-2 | Diversified-5 | Government | U.S.-4 | Developed markets | Other-6 | Real estate, hedge funds, and other | Total | ($ in millions) | Balance, January 1, 2015 | Realized gain | Unrealized gain/(loss) for positions still held | Transfers in/(out) | Foreign currency loss | Balance, December 31, 2015 | Realized gain | Unrealized loss for positions still held | Transfers (out)/in | Foreign currency loss | Balance, December 31, 2016 |


| 2016 2015 2014 | Pension expense | Special terminations, settlements, and curtailments (included above) | Weighted average discount rate(A) | Weighted average expected rate of return on plan assets | Weighted average expected rate of compensation increase |


| (in millions) | 2012 | 2013 | 2014 | 2015 | 2016 | Thereafter | Total |


Fair Value Option Elections Corporate Loans and Loan Commitments The Corporation elected to account for certain large corporate loans and loan commitments which exceeded the Corporations single name credit risk concentration guidelines at fair value in accordance with SFAS 159.
Lending commitments, both funded and unfunded, are actively managed and monitored, and, as appropriate, credit risk for these lending relationships may be mitigated through the use of credit derivatives, with the Corporations credit view and market perspectives determining the size and timing of the hedging activity.
These credit derivatives do not meet the requirements for hedge accounting under SFAS 133 and are therefore carried at fair value with changes in fair value recorded in other income.
Electing the fair value option allows the Corporation to account for these loans and loan commitments at fair value, which is more consistent with managements view of the underlying economics and the manner in which they are managed.
In addition, accounting for these loans and loan commitments at fair value reduces the accounting asymmetry that would otherwise result from carrying the loans at historical cost and the credit derivatives at fair value.
Fair values for the loans and loan commitments are based on market prices, where available, or discounted cash flows using market-based credit spreads of comparable debt instruments or credit derivatives of the specific borrower or comparable borrowers.
Results of discounted cash flow calculations may be adjusted, as appropriate, to reflect other market conditions or the perceived credit risk of the borrower.
At December 31, 2007, funded loans which the Corporation has elected to fair value had an aggregate fair value of $4.59 billion recorded in loans and leases and an aggregate outstanding principal balance of $4.82 billion.
At December 31, 2007, unfunded loan commitments that the Corporation has elected to fair value had an aggregate fair value of $660 million recorded in accrued expenses and other liabilities and an aggregate committed exposure of $20.9 billion.
Interest income on these loans is recorded in interest and fees on loans and leases.
At December 31, 2007, none of these loans were 90 days or more past due and still accruing interest or had been placed on nonaccrual status.
Net losses resulting from changes in fair value of these loans and loan commitments of $413 million were recorded in other income during 2007.
These losses were significantly attributable to changes in instrument-specific credit risk.
Following adoption of SFAS 159, approximately $5 million of direct loan origination fees and costs related to items for which the fair value option was elected were recognized in earnings during 2007.
Previously, these items would have been capitalized and amortized to earnings over the life of the loans.
seasoning and deterioration, and the level of commercial recoveries declined.
Noninterest expense increased $111 million, or five percent, primarily due to the LaSalle merger.


| InvestmentManagement | Years Ended December 31, | (Dollars in millions, except where otherwise noted) | Management fees | Trading services | Processing fees and other | Total fee revenue | Net interest revenue | Total revenue | Total expenses | Income before income tax expense | Pre-tax margin | Average assets (in billions) |


| Years Ended December 31, | 2016 | RiverSource Life | Statutory net gain from operations-1 | Statutory net income-1 | IDS Property Casualty | Statutory net income (loss) | 2016 | Third-party aluminum shipments (kmt) | Average realized price per metric ton of aluminum-2 | Third-party sales | Intersegment sales | Total sales | ATOI |


| 2008 2007 | Deferred loss on the settlement of the treasury rate lock, net of tax | Deferred gain on the settlement of interest rate swap agreements entered into in connection with the Securitization, net oftax | Unrealized losses related to interest rate swap agreements, net of tax |


| December 31, | 2017 | Pipelines (Natural gas, liquids, crude oil and CO2) | Equipment (Natural gas, liquids, crude oil, CO2, and terminals) | Other(a) | Accumulated depreciation, depletion and amortization | 35,704 | Land and land rights-of-way | Construction work in process | Property, plant and equipment, net | Asset (KMI ownership shown if not 100%) | EagleHawk -25% | KM Altamont | Red Cedar -49% | Rocky Mountain | Fort Union -37% | Bighorn -51% | KinderHawk | North Texas | Endeavor -40% | Camino Real | KM Treating | Hiland - Williston | (MBbl/d) | Liberty Pipeline -50% | South Texas NGL Pipelines | Camino Real - Condensate | Hiland - Williston - Oil | EagleHawk - Condensate -25% |


security.
In both cases, the Corporation or a subsidiary may be required to settle the obligation for cash or other securities prior to the contractual maturity date.
These borrowings are reflected in the table as maturing at their contractual maturity date.
During 2015, the Corporation had total long-term debt maturities and redemptions in the aggregate of $40.4 billion consisting of $25.3 billion for Bank of America Corporation, $6.6 billion for Bank of America, N. A.  and $8.5 billion of other debt.
During 2014, the Corporation had total long-term debt maturities and redemptions in the aggregate of $53.7 billion consisting of $33.9 billion for Bank of America Corporation, $8.9 billion for Bank of America, N. A.  and $10.9 billion of other debt.


| Qualified Pension Plans Non-U.S. Pension Plans | (Dollars in millions) | Components of net periodic benefit cost | Service cost | Interest cost | Expected return on plan assets | Amortization of prior service cost | Amortization of net actuarial loss (gain) | Recognized loss due to settlements and curtailments | Net periodic benefit cost (income) | Weighted-average assumptions used to determine net cost for years ended December 31 | Discount rate | Expected return on plan assets | Rate of compensation increase | Nonqualified andOther Pension Plans-1 | (Dollars in millions) | Components of net periodic benefit cost | Service cost | Interest cost | Expected return on plan assets | Amortization of transition obligation | Amortization of prior service cost (credits) | Amortization of net actuarial loss (gain) | Recognized loss due to settlements and curtailments | Net periodic benefit cost (income) | Weighted-average assumptions used to determine net cost for years ended December 31 | Discount rate | Expected return on plan assets | Rate of compensation increase |


| 2013 2012 2011 | Years ended December 31(dollars in millions) | Assets: | Short-term investments -1 | Securities -2 | Loans: | Commercial -3 | Commercial real estate -4 | Residential mortgage | Consumer | Total loans | Total earning assets | Other assets | Total assets | Liabilities and stockholders’ equity: | Deposits: | Non-interest-bearing | Savings, interest-bearing checking and money market | Time | Total deposits | Borrowings: | FHLB advances | Federal funds purchased | Retail repurchase agreements | Other borrowings | Total borrowings | Notes and debentures | Total funding liabilities | Other liabilities | Total liabilities | Stockholders’ equity | Total liabilities and stockholders’ equity | Net interest income/spread -5 | Net interest margin | Operating net interest margin -6 |


| Fiscal2012 Fiscal2011 Fiscal2010 % Change2012-2011 % Change2011-2010 | Americas | Percentage of total revenue | EMEA | Percentage of total revenue | APAC | Percentage of total revenue | Total revenue |


| (millions of dollars) 2012 2011 Variance 2012 vs. 2011 2010 Variance 2011 vs. 2010 | Operating activities | Investing activities | Financing activities | Net change | Balance at beginning of period | Balance at end of period |


| % of Total Revenue | 2014 | Domestic | United Kingdom | Continental Europe | Asia Pacific | Latin America | Other |


| Oil   (MMBbls) Gas   (Bcf) NGLs   (MMBbls) Total   (MMBoe) | U.S. Onshore | U.S. Offshore | Canada | International | Total | 2009 | Long-Term Debt-Principal -1 | Long-Term Debt- Interest-2 | Operating Leases | Ground Leases | Retail Store Leases |


| December 31, 2015 December 31, 2014 | Level 1 | (In thousands) | Interest rate swaps |


Effective January 1, 2003, FASB Interpretation No.45, “Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others” (“FIN 45”), requires the fair-value


| Net Income | Years ended December 31 (in millions) | Commercial Banking | Consumer Financial Services | Treasury | Total reportable segments | Other | Total Consolidated |


The Company incurred significant non-recurring separation costs in 2007 as a result of the Separation.
These costs were primarily associated with establishing the Ameriprise Financial brand, separating and reestablishing the Company’s technology platforms and advisor and employee retention programs.5.
Acquisitions and Pending Transactions On September 30, 2009, the Company announced a definitive agreement to acquire the long-term asset management business of Columbia Management Group (‘‘Columbia’’).
The total consideration to be paid will be between $900 million and $1.2 billion based on net asset flows at Columbia before closing.
The acquisition is expected to be funded through the use of cash on hand and is expected to close in the spring of 2010, subject to satisfaction of closing conditions that are generally present in similar acquisitions.
In the fourth quarter of 2008, the Company completed its all-cash acquisitions of H&R Block Financial Advisors, Inc. , subsequently renamed Ameriprise Advisor Services, Inc.  (‘‘AASI’’), J.
& W.  Seligman & Co. , Incorporated (‘‘Seligman’’) and Brecek & Young Advisors, Inc.  for $329 million, $432 million and $26 million, respectively.
The cost of the acquisitions included the purchase price and transaction costs.
These acquisitions further expanded the Company’s retail distribution and asset management businesses.
The Company recorded the assets and liabilities acquired at fair value and allocated the remaining costs to goodwill and intangible assets.
See Note 2 and Note 9 for additional information on goodwill and intangible assets.6.
Variable Interest Entities The Company consolidates a VIE for which it is considered the primary beneficiary.
As of December 31, 2009 and 2008, the Company had investments of $10 million and non-recourse debt of $6 million, respectively, on the Consolidated Balance Sheet related to this entity.
The Company has variable interests for which it is not the primary beneficiary and, therefore, does not consolidate.
The Company’s maximum exposure to loss as a result of its investment in these entities is limited to its carrying value.
The Company has no obligation to provide further financial or other support to the VIEs nor has the Company provided any additional support to the VIEs other than services it is separately compensated for through management agreements.
The Company had no liabilities recorded as of December 31, 2009 and 2008 related to these entities.
The Company is a limited partner in affordable housing partnerships which qualify for government sponsored low income housing tax credit programs.
Certain of these partnerships are considered to be variable interest entities; however, the Company does not consolidate these partnerships because it is not the primary beneficiary.
The carrying values of the affordable housing partnerships are reflected in investments and were $28 million and $54 million as of December 31, 2009 and 2008, respectively.
For the collateralized debt obligations (‘‘CDOs’’) managed by the Company, the Company has evaluated its variability in losses and returns considering its investment levels, which are less than 50% of the residual tranches, and the fees received from managing the structures and has determined that consolidation is not required.
The carrying values of the CDOs are reflected in investments and were $58 million and $50 million as of December 31, 2009 and 2008, respectively.
The Company manages $6.4 billion of underlying collateral consisting primarily of below investment grade syndicated bank loans within the CDOs.7.


SUBSIDIARY GUARANTORS Performance of the Company’s obligations under the senior notes, including any repurchase obligations resulting from a change of control, is unconditionally guaranteed, jointly and severally, on an unsecured basis, by each of HII’s existing and future domestic restricted subsidiaries that guarantees debt under the Credit Facility (the “Subsidiary Guarantors”).
The guarantees rank equally with all other unsecured and unsubordinated indebtedness of the Subsidiary Guarantors.
The Subsidiary Guarantors are each directly or indirectly 100% owned by HII.
Prior to the spin-off of HII from Northrop Grumman, Northrop Grumman conducted an internal reorganization, effective on March 30, 2011, that resulted in the Company’s current organizational structure, which consists of HII as direct or indirect parent of all of the Subsidiary Guarantors.
Prior to this internal reorganization, HII had no independent assets or operations and no subsidiaries.
Accordingly, for all periods ended prior to March 30, 2011, the consolidated financial information of the Company is attributable entirely to the Subsidiary Guarantors.


| Year ended December 31, | $ in millions, except per share data | Management fees earned from CIP, eliminated upon consolidation | Performance fees earned from CIP, eliminated upon consolidation | Other revenues recorded by CIP | CIP related adjustments in arriving at net revenues | $ in millions | Long-term debt | Fixed rate | Floating rate | Total | Weighted average interest rate percentage | Weighted average period for which rate is fixed in years |


| Operating Subsidiary: A.M. Best Standard & Poor's Moody's | Everest Re | Bermuda Re | Ireland Re | Everest National | Everest Indemnity | Everest Security | Everest International Assurance, Ltd. | Everest International | Everest Canada | Mt. Logan Re Ltd. |


General and Administrative Expenses General and Administrative expenses for the year ended December 31, 2015 were approximately $25.7 million, an increase of $4.8 million from the year ended December 31, 2014.
The majority of the increase was related to increases in legal fees of $2.7 million and stock option expenses of $1.6 million.


| Year Ended December 31, | 2014 | (dollars in millions) | Assets | Interest-bearing cash and due from banks and deposits in banks | Taxable investment securities | Non-taxable investment securities | Total investment securities | Commercial | Commercial real estate | Leases | Total commercial | Residential mortgages | Home equity loans | Home equity lines of credit | Home equity loans serviced by others-1 | Home equity lines of credit serviced by others-1 | Automobile | Student | Credit cards | Other retail | Total retail | Total loans and leases-2 | Loans held for sale | Other loans held for sale | Interest-earning assets | Allowance for loan and lease losses | Goodwill | Other noninterest-earning assets | Total noninterest-earning assets | Total assets | Liabilities and Stockholders' Equity | Checking with interest | Money market and savings | Term deposits | Total interest-bearing deposits | Interest-bearing deposits held for sale |


| Pension Benefits Postretirement Benefits | 2004 | (In thousands) | Change in benefit obligation: | Benefit obligation at beginning of year | Service cost | Interest cost | Plan participants’ contributions | Actuarial loss | Business combinations | Benefits paid | Benefit obligation at end of year | Change in plan assets: | Fair value of plan assets at beginning of year | Actual return on plan assets | Plan participants’ contributions | Business combinations | Benefits and other payments | Fair value of plan assets at end of year | Funded status | Unrecognized net actuarial loss | Unrecognized prior service cost | Prepaid (accrued) benefit cost | Amounts recognized in the consolidated balance sheet were: | Prepaid benefit cost (asset) | Accrued benefit cost (liability) | Intangible asset | Pre-tax charge to accumulated other comprehensive income | $-89,911 |


Note 21 PENSION, POSTRETIREMENT AND POSTEMPLOYMENT LIABILITIES The Company and certain of its subsidiaries sponsor defined benefit pension plans, defined contribution plans and termination indemnity plans for regular full-time employees.
The principal defined benefit pension plan is the Bristol-Myers Squibb Retirement Income Plan, which covers most U. S.  employees and which represents approximately 70% of the consolidated pension plan assets and obligations.
The funding policy is to contribute amounts to fund past service liability .
Plan benefits are based primarily on the participant’s years of credited service and final average compensation.
Plan assets consist principally of equity and fixed-income securities.
Comprehensive medical and group life benefits are provided for substantially all U. S.  retirees who elect to participate in comprehensive medical and group life plans.
The medical plan is contributory.
Contributions are adjusted periodically and vary by date of retirement.
The life insurance plan is noncontributory.
Plan assets consist principally of equity and fixed-income securities.
Similar plans exist for employees in certain countries outside of the U. S.  The net periodic benefit cost of defined benefit pension and postretirement benefit plans includes:


The table below sets forth the components of Citi’s LCR calculation and HQLA in excess of net outflows for the periods indicated: Note: Amounts set forth in the table above are presented on an average basis.
As set forth in the table above, Citi’s LCR increased both year-over-year and sequentially.
The increase year-over-year was driven by both an increase in HQLA and a reduction in net outflows.
Sequentially, the increase was driven by a slight reduction in net outflows, as HQLA remained largely unchanged.


increase of $8.5 million in interest income, compared to the prior year, partially offset by foreign currency losses of $7.5 million, compared to the prior year.
Provision for Income Taxes.
We recorded a 21.0% provision for income taxes for fiscal year 2019, compared to 24.9% in fiscal year 2018 and 26.9% in fiscal year 2017.
The decrease in the effective tax rate from fiscal year 2018 to 2019 is primarily due to a further reduction in the U. S.  federal income tax rate to 21%, the non-recurring tax expense recorded in fiscal year 2018 for deemed repatriation of undistributed foreign earnings and remeasurement of net deferred tax assets, partially offset by a decrease in tax deductible stock compensation.
The decrease in the effective tax rate from fiscal year 2017 to 2018 was primarily due to the impacts of the Tax Cuts and Jobs Act enacted on December 22, 2017, partially offset with foreign tax credits from a one-time distribution in fiscal year 2017.
We record a valuation allowance to reduce our deferred tax assets to the amount we believe is more-likely-than-not to be realized.
In making these determinations we consider historical and projected taxable income, and ongoing prudent and feasible tax planning strategies in assessing the appropriateness of a valuation allowance.
The net increase in the valuation allowance of $0.7 million for fiscal year 2019 and $4.6 million for fiscal year 2018 was primarily related to tax net operating losses incurred in certain foreign jurisdictions and state tax credit carryforwards.
Our net deferred tax assets as of September 30, 2019, 2018 and 2017 were $27.4 million, $33.4 million and $53.2 million, respectively.
Our worldwide effective tax rate may fluctuate based on a number of factors, including variations in projected taxable income in the various geographic locations in which we operate, changes in the valuation of our net deferred tax assets, resolution of potential exposures, tax positions taken on tax returns filed in the various geographic locations in which we operate, and the introduction of new accounting standards or changes in tax laws or interpretations thereof in the various geographic locations in which we operate.
We have recorded liabilities to address potential tax exposures related to business and income tax positions we have taken that could be challenged by taxing authorities.
The ultimate resolution of these potential exposures may be greater or less than the liabilities recorded which could result in an adjustment to our future tax expense.


| (In millions) United States Europe Africa Other Int’l Total | 2007 | Sales(a) | Transfers | Other income(b) | Total revenues | Expenses: | Production costs | Transportation costs(c) | Exploration expenses | Depreciation, depletion and amortization | Administrative expenses | Total expenses | Other production-related income(d) | Results before income taxes | Income tax provision (benefit) | Results of continuing operations | Results of discontinued operations | 2006 | Sales(a) | Transfers | Other income(b) | Total revenues | Expenses: | Production costs | Transportation costs(c) | Exploration expenses | Depreciation, depletion and amortization | Administrative expenses | Total expenses | Other production-related income(d) | Results before income taxes | Income tax provision (benefit) | Results of continuing operations | Results of discontinued operations | 2005 | Sales(a) | Transfers | Other income(b) | Total revenues | Expenses: | Production costs | Transportation costs(c) | Exploration expenses | Depreciation, depletion and amortization | Administrative expenses | Total expenses | Other production-related income(d) | Results before income taxes | Income tax provision (benefit) | Results of continuing operations | Results of discontinued operations |


Table 30 presents commercial utilized reservable criticized exposure by product type.
Criticized exposure corresponds to the Special Mention, Substandard and Doubtful asset categories defined by regulatory authorities.
In addition to reservable loans and leases, excluding those accounted for under the fair value option, exposure includes SBLCs, financial guarantees, bankers acceptances and commercial letters of credit for which we are legally bound to advance funds under prescribed conditions, during a specified period.
Although funds have not been advanced, these exposure types are considered utilized for credit risk management purposes.
Total commercial utilized reservable criticized exposure rose by $21.7 billion primarily due to increases in commercial real estate and commercial  domestic.
Commercial real estate increased $10.0 billion primarily due to the non-homebuilder portfolio which has been impacted by the weak economy partially offset by a decrease in the homebuilder portfolio.
The $9.3 billion increase in commercial  domestic reflects deterioration across various lines of business and industries, primarily in Global Banking.
At December 31, 2009, approximately 85 percent of the loans within criticized reservable utilized exposure are secured.


| 2015 2014 2013 | $ in billions | January 1 | Long-term inflows | Long-term outflows | Long-term net flows | Net flows in Invesco Powershares QQQ fund | Net flows in institutional money market funds | Total net flows | Market gains and losses/reinvestment | Acquisitions/dispositions, net-4 | Foreign currency translation | December 31 | Average AUM | Average long-term AUM | Average AUM | Revenue yield | Gross revenue yield on AUM-2 | Gross revenue yield on AUM before performance fees-2 | Net revenue yield on AUM-3 | Net revenue yield on AUM before performance fees-3 | 2007 (all amounts in millions) | Revenues from rental property -1 | Rental property expenses: -2 | Rent | Real estate taxes | Operating and maintenance | $183.7 | Depreciation and amortization -3 |


| December 31, 2014 December 31, 2013 | Dollars in millions | Total assets | Total assets at fair value as a percentage of consolidated assets | Level 3 assets as a percentage of total assets at fair value | Level 3 assets as a percentage of consolidated assets | Total liabilities | Total liabilities at fair value as a percentage of consolidated liabilities | Level 3 liabilities as a percentage of total liabilities at fair value | Level 3 liabilities as a percentage of consolidated liabilities |


| As of and for the Year Ended December 31, | (dollars in millions) | Net interest income | Noninterest income | Total revenue | Noninterest expense | Profit before provision for credit losses | Provision for credit losses | Income before income tax expense | Income tax expense | Net income | Loans and leases and loans held for sale (year-end) | Average Balances: | Total assets | Loans and leases and loans held for sale-1 | Deposits and deposits held for sale-2 | Interest-earning assets | Key Performance Metrics: | Net interest margin | Efficiency ratio | Average loans to average deposits ratio-3 | Return on average total tangible assets | Return on average tangible common equity-4 |


| 2015 2014 2013 | Net sales | Operating profit | Operating margins | Backlog at year-end |


| December 31, | (in millions) | Commercial | Commercial real estate | Leases | Total commercial loans and leases | Residential mortgages | Home equity loans | Home equity lines of credit | Home equity loans serviced by others | Home equity lines of credit serviced by others | Automobile | Education | Credit cards | Other retail | Total retail loans | Total loans and leases-1(2) |


| Year Ended December 31, | 2015 | Beginning Balance | Additions based on positions related to the current year | Additions based on positions related to prior years | Reductions for tax positions of prior years | Settlements with taxing authorities | Statute of limitation expirations | Ending Balance |


| December 31, 2007 Cost Gross Unrealized Losses Estimated Fair Market Value | Auction rate securities: | Debt instruments with contractual maturity dates in 2021, 2033, and 2036 | Contingent capital securities with no maturity dates | Total |


| Company Payments Volume  (billions) Total Volume  (billions) Total Transactions  (billions) Cards  (millions) | Visa Inc.-1 | MasterCard | American Express | Discover | JCB | Diners Club |


amount of unrecognized tax benefit related to permanent differences because a portion of those unrecognized benefits relate to state tax matters.
It is reasonably possible that the liability for uncertain tax positions could increase or decrease in the next twelve months due to completion of tax authorities exams or the expiration of statutes of limitations.
Management estimates that the liability for uncertain tax positions could decrease by $5 million within the next twelve months.
The consolidated federal income tax returns of The PNC Financial Services Group, Inc.  and subsidiaries through 2003 have been audited by the Internal Revenue Service and we have resolved all disputed matters through the IRS appeals division.
The Internal Revenue Service is currently examining the 2004 through 2006 consolidated federal income tax returns of The PNC Financial Services Group, Inc.  and subsidiaries.
The consolidated federal income tax returns of National City Corporation and subsidiaries through 2004 have been audited by the Internal Revenue Service and we have reached agreement in principle on resolution of all disputed matters through the IRS appeals division.
However, because the agreement is still subject to execution of a closing agreement we have not treated it as effectively settled.
The Internal Revenue Service is currently examining the 2005 through 2007 consolidated federal income tax returns of National City Corporation and subsidiaries, and we expect the 2008 federal income tax return to begin being audited as soon as it is filed.
New York, New Jersey, Maryland and New York City are principally where we were subject to state and local income tax prior to our acquisition of National City.
The state of New York is currently in the process of closing the 2002 to 2004 audit and will begin auditing the years 2005 and 2006.
New York City is currently auditing 2004 and 2005.
However, years 2002 and 2003 remain subject to examination by New York City pending completion of the New York state audit.
Through 2006, BlackRock is included in our New York and New York City combined tax filings and constituted most of the tax liability.
Years subsequent to 2004 remain subject to examination by New Jersey and years subsequent to 2005 remain subject to examination by Maryland.
National City was principally subject to state and local income tax in California, Florida, Illinois, Indiana, and Missouri.
Audits currently in process for these states include: California (2003-2004), Illinois (2004-2006) and Missouri (2003-2005).
We will now also be principally subject to tax in those states.
In the ordinary course of business we are routinely subject to audit by the taxing authorities of these states and at any given time a number of audits will be in process.
Our policy is to classify interest and penalties associated with income taxes as income taxes.
At January 1, 2008, we had accrued $91 million of interest related to tax positions, most of which related to our cross-border leasing transactions.
The total accrued interest and penalties at December 31, 2008 was $164 million.
While the leasing related interest decreased with a payment to the IRS, the $73 million net increase primarily resulted from our acquisition of National City.


Table of Contents Revenues 2003 Compared to 2002 The Companys revenues increased approximately $1.4 billion, or 8.8 percent, to $17.4 billion, largely as a result of its capacity purchase agreements with American Eagle Airlines, Inc.  and Executive Airlines, Inc.  (collectively, AMR Eagle), as discussed below and in Note 13 to the consolidated financial statements.
Passenger revenues were relatively flat year-over-year.
During the first four months of the year, yields (passenger revenue per available seat mile) and load factors were down year-over-year, due to the impact of the war in Iraq and SARS.
In the latter part of the year, both yields and load factors improved year- over-year, as the impact of the war in Iraq and SARS faded, and the U. S.  economy began recovering.
However, even with the recent improvements, the Companys unit revenues and yield are still depressed relative to historical measures.
For the full year, Americans passenger revenues decreased by 0.7 percent, or $107 million, to $14.3 billion, on a capacity decrease of 4.1 percent to 165 billion available seat miles (ASMs).
Americans passenger load factor increased 2.1 points to 72.8 percent and passenger revenue yield per passenger mile increased by 0.4 percent, or 0.05 cents, to 11.91 cents, driving Americans passenger revenue per available seat mile (RASM) up by 3.3 percent, or 0.28 cents, to 8.67 cents.
In 2003, American derived approximately 70 percent of its passenger revenues from domestic operations and approximately 30 percent from international operations.
Following is additional information regarding Americans domestic and international RASM and capacity:


| December 31, 2008 | Amortized cost | (in millions) | Finance — Banking | Finance — Brokerage | Finance — Finance Companies | Finance — Financial Other | Finance — Insurance | Finance — REITS | Industrial — Basic Industry | Industrial — Capital Goods | Industrial — Communications | Industrial — Consumer Cyclical | Industrial — Consumer Non-Cyclical | Industrial — Energy | Industrial — Other | Industrial — Technology | Industrial — Transportation | Utility — Electric | Utility — Natural Gas | Utility — Other | Government guaranteed | Total corporate securities | Residential pass-through securities | Commercial mortgage-backed securities | Residential collateralized mortgage obligations -1 | Asset-backed securities — Home equity -2 | Asset-backed securities — All other | Collateralized debt obligations — Credit | Collateralized debt obligations — CMBS | Collateralized debt obligations — Loans | Collateralized debt obligations — ABS -3 | Total mortgage-backed and other asset-backed securities | U.S. Government and agencies | States and political subdivisions | Non-U.S. governments | Total fixed maturity securities, available-for-sale |


Drilling Revenue of $14.25 billion was 73% higher than the same period last year reflecting the acquisitions of Smith, in August 2010, and Geoservices, in April 2010, partially offset by a decrease in IPM activities in Mexico.
The ramp-up of IPM projects in Iraq also contributed to the revenue increase.
Year-on-year, pretax operating margin decreased 24 bps to 16.0% largely due to the addition of the Smith and Geoservices activities as well as the effects of the geopolitical events.


| 2011 2010 2009 2008 | $120,424 |


| December 31, 2014 December 31, 2013 | (in millions) | Risk exposure | Interest rate | Credit | Foreign exchange | Equity | Commodity | Total structured notes |


| December 31, 2015 December 31, 2014 | Series | Floating Rate Non-Cumulative Preferred Stock, Series A | 6.50% Non-Cumulative Preferred Stock, Series B -1 | 5.25% Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series C | Series A Junior Participating Preferred Stock | Not designated -1 | Total |


| Amount (In Millions) | 2015 net revenue | Retail electric price | Volume/weather | Louisiana Act 55 financing savings obligation | Other | 2016 net revenue | December 31 | 2007 | Other current assets | Sundry | Other current liabilities | Deferred income taxes | $20.4 | Period | October 1-31, 2007 | November 1-30, 2007 | December 1-31, 2007 | Total | (Unaudited) | (Dollar amounts in millions, except per share data) | Summary of Operations | Net Sales from Continuing Operations | Net Earnings from Continuing Operations | Net Earnings (Loss) from Discontinued Operations | Net Earnings (Loss) | Earnings per share from Continuing Operations | Basic | Diluted | Earnings (Loss) per share from Discontinued Operations | Basic | Diluted | Net Earnings (Loss) per share | Basic | Diluted | Cash Dividends declared per share | Summary of Financial Position | Total Assets | Long-term Debt |


| 2011 2010 2009 | Net income | Shares used to compute basic net income per share | Dilutive potential common shares: | Unvested restricted stock and performance share awards | Stock options | Shares used to compute diluted net income per share | Basic net income per share | Diluted net income per share |


| Amount (In Millions) | 2006 net revenue | Net wholesale revenue | Transmission revenue | Deferred fuel costs revisions | Other | 2007 net revenue |


| Years Ended December 31, | 2010 | CIEs | (in millions) | Revenues | Net investment income (loss) | Other revenues | Total revenues | Banking and deposit interest expense | Total net revenues | Expenses | Distribution expenses | Interest and debt expense | General and administrative expense | Total expenses | Pretax loss | Less: Net income attributable to noncontrolling interests | Pretax loss attributable to Ameriprise Financial |


| (Unaudited)Year Ended December 31, | 2016-1 | Total Revenues | Income (Loss) from Continuing Operations | Per Share Income (Loss) from Continuing Operations - Basic | Per Share Income (Loss) from Continuing Operations - Diluted |


| Con Edison Con Edison of New York | Shares | Outstanding at 12/31/05 | Granted | Exercised | Forfeited | Outstanding at 12/31/06 | Exercised | Forfeited | Outstanding at 12/31/07 | Exercised | Forfeited | Outstanding at 12/31/08 |


| Preferred Shares | December 31Shares in thousands | Authorized | $1 par value | Issued and outstanding | Series B | Series K | Series L | Series O | Series P | Series Q | Total issued and outstanding |


| (in basis points) Industry Average | for the fiscal years ended September 30, | Equity | Global/international | United States | Hybrid | Fixed Income | Tax-free | Taxable | Global/international2 | United States | Cash Management |


| Year ended December 31,(inmillions, except headcount) 2007 2006 2005 | Revenue by region | Americas | Europe/Middle East/Africa | Asia/Pacific | Total net revenue | Selected average balances | Total assets | Trading assets–debt and equity instruments(a) | Trading assets–derivative receivables | Loans: | Loans retained(b) | Loans held-for-sale and loans at fair value(a) | Total loans | Adjusted assets(c) | Equity | Headcount |


| Changes in Unrealized Gains | Total Gains (Losses) | Realized/Unrealized | Included in | Balance- | January 1, | 2008 | (In thousands) | Investment securities available for sale: | U.S. Treasury and federal agencies | Obligations of states and political subdivisions | Government issued or guaranteed mortgage-backed securities | Privately issued residential and commercial mortgage-backed securities | Collateralized debt obligations | Equity securities | 1,313,821 | Other assets and other liabilities |


| September 30, September 24,  2005  As Restated -1 September 25,  2004  As Restated -1 | 2006 | Net sales | Cost of sales | Gross margin | Gross margin percentage |


RECOURSE AND REPURCHASE OBLIGATIONS As discussed in Note 3 Loan Sale and Servicing Activities and Variable Interest Entities, PNC has sold commercial mortgage, residential mortgage and home equity loans directly or indirectly through securitization and loan sale transactions in which we have continuing involvement.
One form of continuing involvement includes certain recourse and loan repurchase obligations associated with the transferred assets.
COMMERCIAL MORTGAGE LOAN RECOURSE OBLIGATIONS We originate, close and service certain multi-family commercial mortgage loans which are sold to FNMA under FNMAs Delegated Underwriting and Servicing (DUS) program.
We participated in a similar program with the FHLMC.
Under these programs, we generally assume up to a one-third pari passu risk of loss on unpaid principal balances through a loss share arrangement.
At December 31, 2013 and December 31, 2012, the unpaid principal balance outstanding of loans sold as a participant in these programs was $11.7 billion and $12.8 billion, respectively.
The potential maximum exposure under the loss share arrangements was $3.6 billion at December 31, 2013 and $3.9 billion at December 31, 2012.
We maintain a reserve for estimated losses based upon our exposure.
The reserve for losses under these programs totaled $33 million and $43 million as of December 31, 2013 and December 31, 2012, respectively, and is included in Other liabilities on our Consolidated Balance Sheet.
If payment is required under these programs, we would not have a contractual interest in the collateral underlying the mortgage loans on which losses occurred, although the value of the collateral is taken into account in determining our share of such losses.
Our exposure and activity associated with these recourse obligations are reported in the Corporate & Institutional Banking segment.
Table 152: Analysis of Commercial Mortgage Recourse Obligations


Each clearing firm is required to deposit and maintain balances in the form of cash, U. S.  government securities, certain foreign government securities, bank letters of credit or other approved investments to satisfy performance bond and guaranty fund requirements.
All non-cash deposits are marked-to-market and haircut on a daily basis.
Securities deposited by the clearing firms are not reflected in the consolidated financial statements and the clearing house does not earn any interest on these deposits.
These balances may fluctuate significantly over time due to investment choices available to clearing firms and changes in the amount of contributions required.
In addition, the rules and regulations of CBOT require that collateral be provided for delivery of physical commodities, maintenance of capital requirements and deposits on pending arbitration matters.
To satisfy these requirements, clearing firms that have accounts that trade certain CBOT products have deposited cash, U. S.  Treasury securities or letters of credit.
The clearing house marks-to-market open positions at least once a day (twice a day for futures and options contracts), and require payment from clearing firms whose positions have lost value and make payments to clearing firms whose positions had gained value.
The clearing house has the capability to mark-to-market more frequently as market conditions warrant.
Under the extremely unlikely scenario of simultaneous default by every clearing firm who has open positions with unrealized losses, the maximum exposure related to positions other than credit default and interest rate swap contracts would be one half day of changes in fair value of all open positions, before considering the clearing houses’ ability to access defaulting clearing firms’ collateral deposits.
For cleared credit default swap and interest rate swap contracts, the maximum exposure related to CME’s guarantee would be one full day of changes in fair value of all open positions, before considering CME’s ability to access defaulting clearing firms’ collateral.
During 2017, the clearing house transferred an average of approximately $2.4 billion a day through the clearing system for settlement from clearing firms whose positions had lost value to clearing firms whose positions had gained value.
The clearing house reduces the guarantee exposure through initial and maintenance performance bond requirements and mandatory guaranty fund contributions.
The company believes that the guarantee liability is immaterial and therefore has not recorded any liability at December 31, 2017.
At December 31, 2016, performance bond and guaranty fund contribution assets on the consolidated balance sheets included cash as well as U. S.  Treasury and U. S.  government agency securities with maturity dates of 90 days or less.
The U. S.  Treasury and U. S.  government agency securities were purchased by CME, at its discretion, using cash collateral.
The benefits, including interest earned, and risks of ownership accrue to CME.
Interest earned is included in investment income on the consolidated statements of income.
There were no U. S.  Treasury and U. S.  government agency securities held at December 31, 2017.
The amortized cost and fair value of these securities at December 31, 2016 were as follows:


PART III ITEM 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE For the information required by this Item 10, other than information with respect to our Executive Officers contained at the end of Part I, Item 1 of this report, see “Election Of Directors,” “Nominees for Election to the Board of Directors,” “Corporate Governance” and “Section 16(a) Beneficial Ownership Reporting Compliance,” in the Proxy Statement for our 2016 Annual Meeting, which information is incorporated herein by reference.
The Proxy Statement for our 2016 Annual Meeting will be filed within 120 days of the close of our year.
For the information required by this Item 10 with respect to our Executive Officers, see Part I, Item 1.  of this report.


| Year Ended December 31, | Dollars in Millions | Cash flow provided by/(used in): | Operating activities | Investing activities | Financing activities |


| Plan category Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights-1(a)(b) Weighted-Average Exercise Price of Outstanding Options,Warrants and Rights-2 Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding SecuritiesReflected in Column (a)) (c) | Equity compensation plans approved by security holders | Equity compensation plans not approved by security holders-3 | Total |