Bank of America 2014 Annual Report Download - page 254

252 Bank of America 2014
Nonrecurring Fair Value
The Corporation holds certain assets that are measured at fair value, but only in certain situations (e.g., impairment) and these
measurements are referred to herein as nonrecurring. These assets primarily include LHFS, certain loans and leases, and foreclosed
properties. The amounts below represent only balances measured at fair value during 2014, 2013 and 2012, and still held as of the
reporting date.
Assets Measured at Fair Value on a Nonrecurring Basis
December 31
2014 2013
(Dollars in millions) Level 2 Level 3 Level 2 Level 3
Assets
Loans held-for-sale $156 $30 $ 2,138 $ 115
Loans and leases 5 4,636 18 5,240
Foreclosed properties (1) — 1,197 12 1,258
Other assets 13 —88 —
Gains (Losses)
2014 2013 2012
Assets
Loans held-for-sale $(19) $ (71) $ (24)
Loans and leases (1,132)(1,104) (3,116)
Foreclosed properties (1) (40) (39) (47)
Other assets (6)(20) (16)
(1) Amounts are included in other assets on the Consolidated Balance Sheet and represent fair value of, and related losses on, foreclosed properties that were written down subsequent to their initial
classification as foreclosed properties.
The table below presents information about significant unobservable inputs related to the Corporation’s nonrecurring Level 3 financial
assets and liabilities at December 31, 2014 and 2013.
Quantitative Information about Nonrecurring Level 3 Fair Value Measurements
December 31, 2014
(Dollars in millions) Inputs
Financial Instrument
Fair
Value
Valuation
Technique
Significant Unobservable
Inputs
Ranges of
Inputs
Weighted
Average
Instruments backed by residential real estate assets $ 4,636 Market comparables OREO discount 0% to 28% 8%
Loans and leases 4,636 Cost to sell 7% to 14% 8%
December 31, 2013
Instruments backed by residential real estate assets $ 5,240 Market comparables OREO discount 0% to 19% 8%
Loans and leases 5,240 Cost to sell 8% n/a
n/a = not applicable
Instruments backed by residential real estate assets represent
residential mortgages where the loan has been written down to
the fair value of the underlying collateral. In addition to the
instruments disclosed in the table above, the Corporation holds
foreclosed residential properties where the fair value is based on
unadjusted third-party appraisals or broker price opinions.
Appraisals are generally conducted every 90 days. Factors
considered in determining the fair value include geographic sales
trends, the value of comparable surrounding properties as well as
the condition of the property.