Bank of America 2015 Annual Report Download - page 193

Bank of America 2015 191
Offsetting of Securities Financing Agreements
Substantially all of the Corporation’s securities financing activities
are transacted under legally enforceable master repurchase
agreements or legally enforceable master securities lending
agreements that give the Corporation, in the event of default by
the counterparty, the right to liquidate securities held and to offset
receivables and payables with the same counterparty. The
Corporation offsets securities financing transactions with the
same counterparty on the Consolidated Balance Sheet where it
has such a legally enforceable master netting agreement and the
transactions have the same maturity date.
The Securities Financing Agreements table presents securities
financing agreements included on the Consolidated Balance Sheet
in federal funds sold and securities borrowed or purchased under
agreements to resell, and in federal funds purchased and
securities loaned or sold under agreements to repurchase at
December 31, 2015 and 2014. Balances are presented on a gross
basis, prior to the application of counterparty netting. Gross assets
and liabilities are adjusted on an aggregate basis to take into
consideration the effects of legally enforceable master netting
agreements. For more information on the offsetting of derivatives,
see Note 2 – Derivatives.
The “Other” amount in the table, which is included on the
Consolidated Balance Sheet in accrued expenses and other
liabilities, relates to transactions where the Corporation acts as
the lender in a securities lending agreement and receives
securities that can be pledged as collateral or sold. In these
transactions, the Corporation recognizes an asset at fair value,
representing the securities received, and a liability, representing
the obligation to return those securities.
Gross assets and liabilities in the table include activity where
uncertainty exists as to the enforceability of certain master netting
agreements under bankruptcy laws in some countries or industries
and, accordingly, these are reported on a gross basis.
The column titled “Financial Instruments” in the table includes
securities collateral received or pledged under repurchase or
securities lending agreements where there is a legally enforceable
master netting agreement. These amounts are not offset on the
Consolidated Balance Sheet, but are shown as a reduction to the
net balance sheet amount in this table to derive a net asset or
liability. Securities collateral received or pledged where the legal
enforceability of the master netting agreements is not certain is
not included.
Securities Financing Agreements
December 31, 2015
(Dollars in millions)
Gross Assets/
Liabilities
Amounts
Offset
Net Balance
Sheet Amount
Financial
Instruments
Net Assets/
Liabilities
Securities borrowed or purchased under agreements to resell (1) $ 347,281 $ (154,799) $ 192,482 $ (144,332) $ 48,150
Securities loaned or sold under agreements to repurchase $ 329,078 $ (154,799) $ 174,279 $ (135,737) $ 38,542
Other 13,235 — 13,235 (13,235) —
Total $ 342,313 $ (154,799) $ 187,514 $ (148,972) $ 38,542
December 31, 2014
Securities borrowed or purchased under agreements to resell (1) $ 316,567 $ (124,744) $ 191,823 $ (145,573) $ 46,250
Securities loaned or sold under agreements to repurchase $ 326,007 $ (124,744) $ 201,263 $ (164,306) $ 36,957
Other 11,641 — 11,641 (11,641) —
Total $ 337,648 $ (124,744) $ 212,904 $ (175,947) $ 36,957
(1) Excludes repurchase activity of $9.3 billion and $5.6 billion reported in loans and leases on the Consolidated Balance Sheet at December 31, 2015 and 2014.