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GE 2013 ANNUAL REPORT 123
    
The following tables present the changes in Level 3 instruments measured on a recurring basis for the years ended December 31,
2013 and 2012, respectively. The majority of our Level 3 balances consists of investment securities classifi ed as available-for-sale with
changes in fair value recorded in shareowners’ equity.
CHANGES IN LEVEL 3 INSTRUMENTS FOR THE YEAR ENDED DECEMBER 31, 2013
(In millions)
Balance at
January 1,
2013
Net realized/
unrealized
gains (losses)
included in
earnings (a)
Net realized/
unrealized
gains (losses)
included in
accumulated
other
comprehen-
sive income Purchases Sales Settlements
Transfers
into
Level 3 (b)
Transfers
out of
Level 3 (b)
Balance at
December 31,
2013
Net change
in unrealized
gains (losses)
relating to
instruments
still held at
December 31,
2013 (c)
Investment securities
Debt
U.S. corporate $ 3,591 $ (497) $ 135 $ 380 $ (424) $ (231) $ 108 $ (109) $ 2,953 $ —
State and municipal 77 — (7) 21 — (5) 10 — 96 —
Residential
mortgage-backed 100 — (5) — (2) (7) — — 86 —
Commercial
mortgage-backed 6 — — — — (6) 10 — 10 —
Asset-backed 5,023 5 32 2,632 (4) (795) 12 (7) 6,898 —
Corporate—non-U.S. 1,218 (103) 49 5,814 (3) (5,874) 21 (58) 1,064 —
Government—non-U.S. 42 1 (12) — — — — — 31 —
U.S. government and
federal agency 277 — (52) — — — — — 225 —
Retained interests 83 3 1 6 — (21) — — 72 —
Equity
Available-for-sale 13 — — — — — — (2) 11 —
Trading — — — — — — — — — —
Derivatives (d) (e) 416 (66) 2 (2) — (226) 37 3 164 (30)
Other 799 (68) 12 538 (779) — 4 (12) 494 (102)
Total $ 11,645 $ (725) $ 155 $ 9,389 $ (1,212) $ (7,165) $ 202 $ (185) $ 12,104 $ (132 )
(a) Earnings effects are primarily included in the “GECC revenues from services” and “Interest and other financial charges” captions in the Statement of Earnings.
(b) Transfers in and out of Level 3 are considered to occur at the beginning of the period. Transfers out of Level 3 were a result of increased use of quotes from independent
pricing vendors based on recent trading activity.
(c) Represented the amount of unrealized gains or losses for the period included in earnings.
(d) Represented derivative assets net of derivative liabilities and included cash accruals of $9 million not reflected in the fair value hierarchy table.
(e) Gains (losses) included in net realized/unrealized gains (losses) included in earnings were offset by the earnings effects from the underlying items that were economically
hedged. See Note 22.