American Express 2009 Annual Report Download - page 107

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
AMERICAN EXPRESS COMPANY
(Millions), net of tax(a)
Net
Unrealized
Gains (Losses)
on Investment
Securities
Net
Unrealized
Gains (Losses)
on
Derivatives
Foreign
Currency
Translation
Adjustments
Net
Unrealized
Pension
and Other
Postretirement
Benefit Costs
Accumulated
Other
Comprehensive
(Loss) Income
Balances as of December 31, 2008 (699) (80) (368) (459) (1,606)
Net unrealized gains (losses) 1,351 (22) 1,329
Reclassification for realized (gains) losses into earnings (145) 74 (71)
Foreign currency translation adjustments(d) 523 523
Net losses related to hedges of investment in foreign
operations (877) (877)
Pension and other postretirement benefit costs (10) (10)
Net change in accumulated other comprehensive
(loss) income 1,206 52 (354) (10) 894
Balances as of December 31, 2009 $ 507 $(28) $(722) $(469) $ (712)
(a) The following table shows the tax impact for the three years ended December 31, for the changes in each component of accumulated other
comprehensive (loss) income:
(Millions) 2009 2008 2007
Investment securities $749 $(472) $(84)
Derivatives 29 (4) (56)
Foreign currency translation adjustments 33 (66) 17
Pension and other postretirement benefit costs (28) (159) 152
Discontinued operations(c) —16 29
Total tax impact $783 $(685) $ 58
(b) In connection with the Company’s adoption of hybrid financial instrument accounting requirements, as of January 1, 2007, the Company
recognized a gain of $80 million ($50 million after-tax) related to the fair value of the interest-only strip, which was recorded in other
comprehensive (loss) income in previous periods. Changes in the fair value of the interest-only strip subsequent to the adoption of this
standard are reflected in securitization income, net.
(c) Relates to the change in accumulated other comprehensive (loss) income prior to the dispositions of AEB and AEIDC.
(d) Includes a $190 million other comprehensive loss, recorded in the third quarter of 2009, representing the correction of an error related to the
accounting in prior periods for cumulative translation adjustments associated with a net investment in foreign subsidiaries. (Refer to Note 19
for further details).
105